October 30, 2018 / 10:08 AM / in 16 days

UPDATE 1-Indonesia parliament body approves $161.7 bln budget for 2019

* 2019 budget is $161.7 billion with 1.84 pct of GDP deficit

* Opposition party accuses political interest in social programmes (Adds details, quotes)

JAKARTA, Oct 30 (Reuters) - The Indonesian parliament’s budgetary committee on Tuesday approved President Joko Widodo’s 2019 budget without many changes from his August proposal, but an opposition party criticised an expansion of the president’s social programmes.

The committee approved a slightly larger budget of 2,461.1 trillion rupiah ($161.65 billion) than Widodo had proposed, but the fiscal deficit target was kept at 1.84 percent of GDP, the chairman of the committee Aziz Syamsuddin said.

The deficit target is the lowest in years and Finance Minister Sri Mulyani Indrawati said it will provide room for the government to deal with global uncertainty next year.

The 2019 budget is Widodo’s last in his first term. He is running for reelection next year and is facing former military general Prabowo Subianto in the contest.

Prabowo’s camp has criticised a 3 trillion rupiah budget for the country’s first ever “District Fund” in 2019, an extension of Widodo’s flagship “Village Fund” where the central government transfers money directly for projects at village levels, managed by community leaders.

The total allocation for the Village Fund in 2019 was approved at 70 trillion rupiah, up 16.7 percent from 2018.

“If it’s disbursed in a political year, 2019, the public can judge for themselves whether there is a motive behind this,” Prabowo’s vice presidential candidate, Sandiaga Uno, said in a televised remark ealier this month.

On Tuesday, Willgo Zainar, a parliament member from opposition Gerindra party doubled down on the criticism.

“The social protection programmes in a political year are very biased and are considered to have political interest,” he said, reading his party’s statement on the budget.

Widodo has defended his policy, saying the fund is for the good of the people.

Indrawati on Tuesday said programmes to reduce the poverty rate should not be politicised.

Analysts had described the budget, which assumes economic growth of 5.3 percent in 2019, inflation at 3.5 percent and the rupiah averaging 15,000 a dollar, as conservative and realistic when it was first laid out.

A smaller deficit also means lower issuance of bonds, which could help support sovereign bond prices if global market turbulance triggers another round of capital outflows.

The parliament, which usually approves the committee’s endorsement, will vote on the budget on Wednesday.

$1 = 15,225.0000 rupiah Reporting by Maikel Jefriando and Gayatri Suroyo; Editing by Kim Coghill

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