BLT Temporary Unconditional Cash Transfer
The Bantuan Langsung Tunai (BLT) program had a clear and modest objective: supplement consumption for poor households facing unprecedented price increases. In 2005 subsidy cuts raised household fuel prices by an average of over 125 percent with 88,...
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Format: | Report |
Language: | English en_US |
Published: |
World Bank, Jakarta
2017
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Online Access: | http://documents.worldbank.org/curated/en/652291468039239723/Bantuan-Langsung-Tunai-BLT-temporary-unconditional-cash-transfer http://hdl.handle.net/10986/26698 |
Summary: | The Bantuan Langsung Tunai (BLT) program
had a clear and modest objective: supplement consumption for
poor households facing unprecedented price increases. In
2005 subsidy cuts raised household fuel prices by an average
of over 125 percent with 88, 186, and 105 percent increases
in gasoline, kerosene, and solar (diesel) fuels
respectively. BLT, a direct cash transfer in four
installments over one year, funded from the implied
budgetary savings from subsidy reductions, was in many
respects the most significant Government of Indonesia (GOI)
response to these programmed increases in fuel prices. It
was targeted to the poor households who were benefiting
least from the old subsidy regime and most at risk from the
negative impacts on consumption from price increases. A
mostly-similar BLT was introduced again in 2008 when
international crises in both financial markets and in food
prices combined with another domestic reduction to fuel
subsidies. BLT provided just-in-time cash assistance to
households affected by an economic shock. BLT added cash
amounts to a household's budget equal to approximately
15 percent of regular expenditures in 2005. These transfers
were more than enough to cover increased expenditure on
fuels. Benefits continued for one year as shocks from
government policy reverberated through the rest of the
macro-economy, allowing beneficiaries time to readjust
spending patterns to new relative prices. |
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