Public Works Ministry ensures no stalled projects
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 - Kementerian PU pastikan tidak ada proyek yang mangkrak
10 February 2025
Public Works Minister Dody Hanggodo emphasised that budget efficiency does not affect the performance of the Public Works Ministry in building the country. The Ministry’s infrastructure development programmes for the fiscal year 2025 have been organised, ensuring that the budget reduction will not hinder or stop ongoing infrastructure projects.
“The Public Works Ministry is accustomed to construction. Therefore, our goal is to complete what we start. There cannot be any abandoned projects, as that is not our motto,” Minister Dody said in Jakarta on Friday (7/2/2025).
According to Minister Dody, the Public Works Ministry will optimise its budget, which has been approved by the Finance Ministry and the House of Representatives (DPR), effectively and transparently. This ensures that infrastructure development can provide maximum benefits to the people.
“We will increase productivity and lower the ICOR, ensuring that each investment provides optimum benefits for a better life,” Minister Dody stated.
Minister Dody added that, with budget efficiency, the Public Works Ministry will optimise constructed infrastructure to provide better benefits to the people. One solution is to optimise completed dams by developing and rehabilitating irrigation networks to supply water to rice fields, thereby increasing the planting index.
“The Public Works Ministry is ready to work. We are continuously optimising existing infrastructure to be more efficient and have a wider reach,” he explained.
The budget of the Public Works Ministry has been reduced by Rp81.38 trillion, from Rp110.95 trillion to Rp29.57 trillion. This amount consists of Rp16.31 trillion in non-pure rupiah and Rp13.26 trillion in pure rupiah. This budget adjustment follows Presidential Instruction Number 1 of 2025 on Budget Efficiency in the Implementation of the State Budget and Regional Budget for Fiscal Year 2025.
Impacting infrastructure projects
Previously, Public Works Minister Dody Hanggodo acknowledged that the expenditure efficiency policy has reduced the Ministry’s budget from Rp110.95 trillion to Rp29.57 trillion. This significant reduction of Rp81.38 trillion will inevitably impact previously planned projects.
At a work meeting with DPR Commission V on Thursday (6/2), Dody explained that the first impact will be felt in the water resources sector, with its budget allocation reduced by Rp27.72 trillion. As a result, several water resources infrastructure projects have been postponed, including the construction of 14 dams.
“The construction of 14 dams, a diversion structure, and lake revitalisations,” Dody stated.
The budget efficiency will also impact the construction of 9,550 hectares of new irrigation networks and the rehabilitation of 29,000 hectares of existing ones. Additionally, it will affect the construction of raw water infrastructure with a capacity of 1.25 cubic metres per second, 19 kilometres of flood control systems, 4.5 kilometres of coastal protection, and lava and sediment control structures.
“Infrastructure maintenance and the Acceleration of the Irrigation Water Use Improvement Programme (P3-TGAI) at 12,000 locations, land procurement, management support, and other related activities,” Dody revealed.
Dody mentioned that the efficiency measures will also impact the highways sector, with Rp24.83 trillion of its budget cut. The projects that need to be made more efficient include the construction of 57 kilometres of new roads and the capacity increase and preservation of 1,102 kilometres of existing roads.
Other impacts will include the construction and duplication of bridges spanning 5,841 metres, the construction and preservation of suspension bridges covering 126,000 metres, and the construction of flyovers, underpasses, and tunnels spanning 94 metres. Additionally, there will be the construction of toll roads extending 7.36 kilometres, routine preservation of roads and bridges covering 47,603 km and 563,402 metres respectively, the cash-for-work programme for 24,600 workers, and technical and management support.
"In the human settlement sector, the budget has been reduced by Rp7.75 trillion for the following activities: the construction of drinking water supply systems (SPAMs) with a capacity of 40 litres per second, the expansion of SPAMs for 863 household connections, and community-based infrastructure at 600 locations," Dody stated.
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