Govt Will Not Cut This Year's IKN Development Budget, OIKN Head Says

February 4, 2025 | 09:19 am

TEMPO.CO, Jakarta - Head of the Nusantara Capital City Authority (OIKN) Basuki Hadimuljono said that the government will not cut the budget for the development of the Nusantara Capital City (IKN) this year. According to him, the IKN budget is still the same as the results of the limited meeting (ratas) with President Prabowo Subianto on Tuesday, January 21, 2025.

Basuki explained that Presidential Instruction (Inpres) Number 1 of 2025 concerning Spending Efficiency in the Implementation of the 2025 State Budget and Regional Budget was made before the limited meeting regarding the IKN was held, so adjustments were indeed needed. "Regarding the budget, we conveyed it to him (President Prabowo), coincidentally there was the Minister of State Secretary, and he answered that it should be adjusted immediately, because Presidential Instruction Number 1 of 2025 was made before the ratas yesterday," said Basuki through an official statement, Monday, February 3, 2025.

Basuki said that he had spoken with Prabowo so that the initial budget for the development of the IKN this year was in accordance with the ceiling and additional budget that had been approved. He said, the IKN budget in the initial budget implementation list or DIPA for this year was Rp6.3 trillion. Prabowo then approved an additional budget of Rp8.1 trillion. The additional budget is planned to be used to start the development of the judicial, legislative, and various other supporting ecosystems in the IKN this year.

According to Basuki, Prabowo had approved a budget of Rp6.3 trillion and an additional Rp8.1 trillion in a limited meeting on January 21, 2025, while the Presidential Instruction on spending efficiency was issued on January 22, 2025. Even so, Basuki said he would write to the Ministry of Finance to adjust the certainty of the IKN development budget. "We were asked to send a letter to the Minister of Finance to adjust the budget according to that approved by the President, which is Rp6.3 trillion plus Rp8.1 trillion," he said.

Prabowo has ordered ministries/institutions and regional heads to carry out budget efficiency. The frugal order was stated in Presidential Instruction Number 1 of 2025 which was signed on January 22, 2025. In the instruction, Prabowo asked his staff to carry out efficiency on the 2025 state budget of Rp306.6 trillion consisting of efficiency of the ministry/institution budget of Rp256.1 trillion, and efficiency of the transfer budget to regions of Rp50.5 trillion.

Following up on Prabowo's instructions, Minister of Finance Sri Mulyani then issued letter S-37/MK.02/2025 which regulates the efficiency of K/L spending for the 2025 budget year. In attachment II of the letter, 16 spending items are listed whose budgets need to be cut by varying percentages, ranging from 10 percent to 90 percent. The details are, efficiency of the office stationery (ATK) budget by 90 percent; ceremonial activities 56.9 percent; meetings, seminars, and the like 45 percent; studies and analysis 51.5 percent; training and technical guidance 29 percent; and honorarium output activities and professional services 40 percent.

Then, printing and souvenirs 75.9 percent; building, vehicle, equipment rental 73.3 percent; application license 21.6 percent; consultant services 45.7 percent; government assistance 16.7 percent; maintenance and care 10.2 percent; business travel 53.9 percent; equipment and machinery 28 percent; infrastructure 34.3 percent; and other expenses 59.1 percent.

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