JAKARTA (Reuters) – A plan by Indonesia’s likely new president Prabowo Subianto to provide free school lunches and milk will cost up to 120 trillion rupiah ($7.68 billion) in its first year, his team said on Wednesday.
Prabowo has declared victory in last week’s presidential election in the world’s third biggest democracy, after quick ballot counts by independent pollsters in sample polling stations showed he had won nearly 60% of votes.
The election commission is due to announce the formal result by March 20 and a new government will take office in October.
Some analysts have warned the cost for Prabowo’s signature campaign pledge, free meals for 82.9 million children, is high and could undermine Indonesia’s track record of fiscal discipline.
His team has said the programme would cost 450 trillion rupiah ($28.79 billion) when it reached its final stage in 2029.
During Prabowo’s first year, however, the programme would require between 100 trillion to 120 trillion rupiah in expenditure to provide well-balanced and healthy meals, said Budiman Sudjatmiko, a senior member of Prabowo’s team of experts, without providing further detail.
Prabowo’s team has estimated that at the final stage, the programme per year would require 6.7 million tonnes of rice, 1.2 million tonnes of chicken, 500,000 tonnes of beef, 1 million tonnes of fish, 4 million kilolitres of milk as well as vegetables and fruits, Budiman said.
The current design of the programme includes collaboration with farmers cooperatives and small businesses, which Budiman said could cut the programme’s total cost further. Investors are paying close attention to the details of the programme.
Bank Indonesia Governor Perry Warjiyo was asked about risks from expansionary fiscal plans by the incoming government during Wednesday’s regular investor conference call, which the central bank hosted after deciding to keep interest rates unchanged in its policy meeting.
Warjiyo said laws banning Indonesia’s annual fiscal deficit from exceeding 3% of GDP would ensure prudent fiscal policy management. ($1 = 15,630.0000 rupiah)
(Reporting by Ananda Teresia and Stefanno Sulaiman; Writing by Gayatri Suroyo)
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