By: Wahyu Gunawan)*
The Indonesian government has once again demonstrated its strong commitment to ensuring the effectiveness of national expenditure. Under the direct leadership of President Prabowo Subianto, a key fiscal policy was enacted in early 2025: the unblocking of Rp86.6 trillion in previously frozen budget allocations. This move is not merely administrative in nature—it is a vital component of a broader fiscal reform strategy designed to accelerate the implementation of national priority programs and deliver tangible benefits to the public.
Budget blocking has traditionally been used as a fiscal control mechanism to withhold portions of ministries’ and agencies’ allocations for reasons of efficiency and selectivity. However, the decision to unblock significant budget portions in 2025 signals a new phase in Indonesia’s fiscal policy, in which the government acknowledges that most ministries and agencies have met technical and administrative requirements and aligned their programs with the national development vision.
Deputy Minister of Finance, Suahasil Nazara, emphasized that the unblocking of funds was in direct response to Presidential Instruction No. 1 of 2025 on Spending Efficiency in the implementation of the National and Regional Budgets (APBN and APBD). This step reflects the government’s confidence in the readiness of ministries and agencies to manage their budgets in a more targeted and accountable manner.
Of the Rp86.6 trillion unblocked, Rp33.1 trillion was allocated to 23 newly formed ministries and agencies resulting from the Merah Putih Cabinet restructuring, while the remaining Rp53.49 trillion was allocated to 76 existing ministries/agencies. This shows that the post-inauguration restructuring of the cabinet was accompanied by strategic fiscal support to ensure that new institutions could immediately function at optimal levels.
This unblocking policy follows significant expenditure efficiency measures, which involved Rp256.1 trillion in budget savings across 99 ministries/agencies, as well as Rp50.6 trillion in regional transfer efficiencies. Before funds were released, a comprehensive evaluation was conducted to sharpen budget allocations based on their alignment with national priorities and overall program effectiveness.
The policy’s real impact is visible in the acceleration of state spending in recent months. According to Suahasil, government expenditure in January 2025 was Rp24.4 trillion, surging to Rp196.1 trillion by March. This represents 16.9% of the total 2025 national budget, a reflection of enhanced synchronization between revenue, spending, and efficient fiscal policy.
A breakdown of spending data further illustrates this acceleration. Expenditure by the 23 newly restructured ministries/agencies rose from Rp5.2 trillion in February to Rp24.7 trillion in March. Meanwhile, spending by the remaining 76 ministries/agencies jumped from Rp22.8 trillion to Rp171.3 trillion over the same period. These increases confirm that the unblocking policy has acted as a catalyst for the swift execution of government programs.
Finance Minister Sri Mulyani Indrawati emphasized that the unblocking policy was also accompanied by President Prabowo’s directive to reallocate funds toward more productive sectors. This affirms that national spending is not just a budget absorption exercise, but a strategic tool to drive economic growth, generate employment, and enhance national competitiveness through industrialization and downstream processing.
Moreover, this policy highlights the government’s dual commitment: being responsive to bureaucratic readiness while proactively responding to economic and social dynamics. By unblocking funds that have passed stringent efficiency screenings, the government sends a strong signal that fiscal stability can be maintained without compromising developmental momentum.
This step is also critical for sustaining public trust. Citizens will grow more confident in the government’s promises when priority programs are not only launched but also deliver visible outcomes. In this context, the unblocking of budget funds is a vital tool for strengthening the government’s credibility.
In essence, this is more than a technocratic budget maneuver—it is a comprehensive macroeconomic strategy. It signifies a government determined to spend with precision, impact, and measurable outcomes. It is no exaggeration to describe this as a “spark” policy, igniting momentum across ministries and agencies to work faster and more focused toward improving public welfare.
Looking ahead, consistency in overseeing efficient and effective spending will be key. The government must continue to conduct thorough evaluations of all programs to ensure that allocated funds are not just absorbed, but translated into real, proportional outcomes. The unblocking of funds is only the beginning. The real challenge lies in ensuring that every rupiah becomes a solution to citizens’ needs and a driver of national progress.
*) The author is an economist and researcher at the Indonesian Prosperous Economy Forum.
