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PEBS FEB UI Examined Government’s Proposal to Increase the Hajj Cost in 2023

Universitas Indonesia > News > Faculty of Economics and Business News > PEBS FEB UI Examined Government’s Proposal to Increase the Hajj Cost in 2023

Recently, the Ministry of Religious Affairs of the Republic of Indonesia (Kemenag RI) proposed an increase in the hajj cost in 2023 for each pilgrim to Rp 69 million. This proposal has caught a lot of public attention because the proposed cost is almost double that of last year. In response to the proposed increase in the 2023 Hajj Travel Expenses (BIPIH), the Center for Islamic Economics and Business (PEBS), Faculty of Economics and Business, Universitas Indonesia (UI) in collaboration with Haji Umrah News.com held PEBS Webinar Series to examine whether the proposal is reasonable and fair.

In his opening remarks, Dean of FEB UI Teguh Dartanto, Ph.D. said that PEBS is a unit at FEB UI that focuses on training, research, and consultation related to Islamic economics and business issues. “This is part of our responsibility as an educational institution to continuously contribute to society,” said Teguh, on Friday (27/1).

As one of the speakers in this webinar, Director General of Hajj and Umrah Organization (Dirjen PHU) Prof. Hilman Latief, Ph.D. said that the Directorate General of Hajj and Umrah Management (Dirjen PHU) of the Ministry of Religious Affairs had contributed to several matters related to the issue of increasing hajj costs. First, the hajj cost is very dynamic because it adapts to unstable macroeconomic conditions. Second, this issue is related to a 30-percent reduction in service fees for domestic pilgrims by Saudi Arabia. He emphasized that this decrease did not come from the overall service, but only from the four-day service in Arafah, Mina, and Muzdalifah.

Furthermore, Prof. Hilman said, the government still strives to devise a design for hajj financial management that is reasonable, healthy, and sustainable as well as resilient to conditions of global uncertainty. In addition, all policymakers need to seek a proportionate allocation of hajj expenses for pilgrims and the government by taking into account the existing conditions.

Meanwhile, according to Diah Pitaloka, M.Sc. as the Deputy Commission VII of the House of Representatives of the Republic of Indonesia, this proposed increase needs clear rationalization and a reasonable amount. Apart from that, the government also needs to think about the fate of pilgrims that have been waiting since 2020 and find the optimal point so that pilgrims are not burdened with the proposed increase in costs. “I hope the government is able to optimize investment so that it can bring benefits to the hajj ecosystem and take advantage of this momentum of increasing hajj cost to improve services,” said Diah.

In an effort to optimize investment, hajj funds will be more optimal if invested in various instruments. Thus, limits and guidelines are needed for investment allocation. This was conveyed by a PEBS researcher and FEB UI lecturer, M Budi Prasetyo, M.S.M. According to him, there are three important issues in managing hajj funds, which are investment, risk, and sustainability of hajj funds. In addition, Budi conveyed that there are several alternative policies that can optimize the management of hajj funds, such as a mixed policy between hajj quotas and a percentage of hajj financial assistance, a switching mechanism to reduce hajj waiting time, revised regulations to support the investment performance of Hajj Fund Management Agency (BKPH), efficiency of the hajj cost structure to make it more affordable for the community, and strengthening effort for BPKH governance in managing hajj funds.

The PEBS Webinar Series also presented other speakers, which are Head of the Implementing Body for BPKH Fadlul Imansyah, S.E., M.M., CIFP., AAK., and Director of Gaido Group M. Hasan Gaido, and was moderated by a PEBS Senior Researcher who is also a FEB UI Lecturer, Dr. Banu Muhammad. With this discussion, Head of PEBS FEB UI Rahmatina Awaliah Kasri, Ph.D. hopes that this PEBS Webinar Series can provide understanding and medium for stakeholders in discussing the proposal of the increase in BIPIH.

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