Transportation access is key to alleviating poverty
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily - Akses transportasi jadi kunci entaskan kemiskinan
19 February 2025
By Ichsan Amin
Transportation access is considered crucial for alleviating poverty and establishing a national food barn. Therefore, providing subsidies in the transportation sector is essential, particularly in underdeveloped areas.
A transportation observer from Unika Soegijapranata in Semarang, Djoko Setijowarno, stated that social, economic, and educational activities are sustained by transportation access.
"Most public activities are sustained by transportation access. Therefore, attempting to alleviate poverty without the primary support of transportation can lead to failure," he revealed to Investor Daily in Jakarta on Tuesday (18/2/2025).
Djoko mentioned that poverty will not be eradicated as long as transportation access is lacking. “To alleviate poverty, transportation access must be improved to facilitate the people,” he stated.
According to him, efforts to increase transportation accessibility in various regions have been implemented by almost all regional heads in Indonesia. However, only a few have been successful so far. This is because the root of the problem has never been addressed, giving the impression that poverty in Indonesia is being managed rather than alleviated, and used as a source of votes every five years.
He added that in several areas of Central Java, children are forced to drop out of school due to the unavailability of public transportation. This rising dropout rate is contributing to an increase in child marriages and cases of stunted growth among children.
He stated, "Poor areas typically suffer from inadequate transportation. In fact, 38% of local and regency roads are damaged."
According to data from the Integrated Road Management System (IRMS), an integrated software system, road conditions in Indonesia are as follows: 92.18% of national roads, 73.79% of provincial roads, and 62% of local/regency roads are in good condition.
On the other hand, other ministries responsible for maintaining transportation access, such as the Public Works Ministry, have faced budget cuts that affect regional connectivity via road access. He stated, "This issue exacerbates the disarray of our public services intended for the common people."
Budget reduction
On a separate occasion, Darmaningtyas, a transportation observer from the Institute for Transportation Studies, expressed concern over the state of public transportation. He explained that budget cuts have led to the termination of services such as Trans Metro Dewata, Trans Pakuan Bogor, and Teman Bus Yogyakarta.
Darmaningtyas stated, "Meanwhile, the pioneer transportation services operated by Damri are essential for people in East Nusa Tenggara (NTT), Maluku, North Maluku, and Papua."
He explained that if pioneer transportation services cannot operate, people will have to pay more. He stated, "The support of ministries, such as the Transportation Ministry, must be evident for public transportation in small regions. This must be carefully considered; the budget cannot be arbitrarily reduced."
He added that this situation indicates a lack of commitment to improving public transportation, which will ultimately impact its safety.
He added, "There is a domino effect from poor transportation management and the lack of transportation, leading to inflation and compromised transportation safety."
The budget for pioneer transportation and transportation subsidies in 2024 was allocated by the Transportation Ministry, covering the land, sea, railway, and air transportation sectors.
Optimise public services
Despite the budget cuts in 2025, Transportation Minister Dudy Purwagandhi emphasised the importance of maintaining subsidies, including the implementation of the Public Service Obligation (PSO).
The Transportation Minister stated, "With the current budget, the provision of subsidised public transportation will continue to be a priority and focus of the Transportation Ministry. Additionally, staff expenditures within the Transportation Ministry are also a priority." He made this statement at the meeting room of DPR Commission V in Senayan, Jakarta, on Thursday (13/2).
The Transportation Minister mentioned that in recent days, his ministry has been conducting a risk-based analysis of the 2025 State Budget (APBN) allocated to the Transportation Ministry. Based on this analysis, all programmes will be implemented using the existing budget.
He added, "The Transportation Ministry is committed to ensuring and optimising affordable transportation services throughout Indonesia. We aim to utilise the 2025 budget as effectively as possible."
According to Finance Minister Letter Number S-75/MK.02/2025 dated 13 February, the current effective budget ceiling for the Transportation Ministry is Rp17.725 trillion. This amount will be utilised by nine echelon I units within the Transportation Ministry.
The budget is planned to be allocated as follows: Rp464.09 billion for the Secretariat General, Rp85.48 billion for the Inspectorate General, Rp3.14 trillion for the Land Transportation Directorate General, Rp7.32 trillion for the Sea Transportation Directorate General, Rp3.39 trillion for the Air Transportation Directorate General, Rp1.31 trillion for the Railways Directorate General, Rp71.01 billion for the Transportation Policy Agency, Rp1.82 trillion for the Transportation Human Resources Development (BPSDMP), and Rp108.95 billion for the Greater Jakarta Transportation Body (BPTJ).
The budget has been reduced by 43.66%, or Rp13.72 trillion, from the original ceiling of Rp31.45 trillion, as stated in the Finance Minister's letter dated 23 September 2024. Despite this reduction, the Transportation Minister assures that transportation services will still be provided optimally.
The Transportation Minister's budget for 2024 allocated Rp1.49 trillion to the Land Transportation Directorate General. This included Rp212.28 billion for 357 road transportation routes, Rp63.9 billion for 35 intermodal transportation routes, and Rp22.2 billion for six cargo transportation routes. Additionally, Rp622.6 billion was allocated for 270 pioneer ferry routes, Rp18 billion for two long-distance roro ferry routes, Rp500 billion for urban transportation in ten cities, and Rp50 billion for supporting urban transportation in IKN.
Meanwhile, the budget for the Air Transportation Directorate General was Rp750 billion. This included Rp108.40 billion for 44 pioneer cargo transportation routes, Rp588.48 billion for 264 pioneer passenger transportation routes, and Rp13.93 billion for one subsidised cargo transportation route. Additionally, the budget covered 10,842 drums of subsidised jet fuel for passengers, amounting to Rp31.95 billion, and 1,583 drums of subsidised jet fuel for cargo transportation.
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