Perppu 1/2020 Legally Becomes Law

Thursday, 14 May 2020

Perppu 1/2020 Legally Becomes Law

JAKARTA.The House of Representatives (DPR) of the Republic of Indonesia officially approved a Bill (RUU) on Government Regulation in Lieu of Law Number 1 of 2020 (Perppu 1/2020) to become a Law (UU). The ratification of the Act was conducted at the plenary session on 12 May 2020. This Perppu 1/2020 has been through a series of intensive discussions between the Government and the House. 

In the plenary session, Minister of Finance Sri Mulyani Indrawati who represented the government, emphasized that to prevent moral hazard, in Article 12 (1) of Perppu 1/2020 has been governed the implementation of state financial policies and the steps stipulated in Perppu 1/2020 that are carried out with due regard to good governance.

"The governance is manifested in the form of a transparent policy determination process and its implementation in implementing laws and regulations of Perppu 1/2020," she explained. 

The former Managing Director of the World Bank also revealed that Perppu 1/2020 can be a strong legal foundation for the Government and institutions related to handling of Covid-19. Furthermore, Sri Mulyani said, in the presence of the Perppu, a number of parties affected by Covid-19 can feel its benefits. Including through several efforts as follow: 

  1. Providing additional budget for prevention of COVID-19 in the health sector amounting to IDR 75 trillion, including for providing incentives for medical doctors, nurses, death benefits, purchasing medical devices including Personal Protective Equipment (APD), masks, hand sanitizers, ventilators, and hospital preparations and also various quarantine facilities;
  2. Expansion of the provision of additional social assistance of IDR 100 trillion for communities affected by COVID-19. More than 29 million families or even above 50% of the people of Indonesia enjoy government assistance in the form of cash, staple food packagea, exemptions and discounts on electricity, to pre-employment cards;
  3. Providing relaxation of taxation incentives, assistance of more than 60 million MSMES in the form of installment delays, interest subsidies and additional assistance of working capital;
  4. Preparation of steps and policies within the framework of the National Economic Recovery (Pemulihan Ekonomi Nasional/PEN) program for businesses in the real sector and financial sector which includes micro businesses, small businesses, medium businesses, large businesses, and cooperatives whose business activities are affected by COVID-19.

Related to the Perppu, there are at least 24 implementation rules that must be completed by the government. As of 9 May 2020, a total of 14 rules have been completed, 8 rules are in the discussion process, and 2 rules are in the next stage process. In the context of handling Covid-19 and its impacts, the Government in addition to issuing implementation rules of Perppu 1 of 2020 also published several other technical regulations. (Ken)



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