JAKARTA, INDONESIA - INDONESIA'S president has ordered government ministries and institutions to slash their spending this year by about 15 per cent, state secretary Hatta Rajasa said on Wednesday.

'Some offices may be able to save 14 per cent, some others more than 15 per cent. What is also worth noting is cutting on spending on fuel, electricity and travels,' Mr Hatta quoted President Susilo Bambang Yudhoyono as saying.

The cut was initially proposed by Finance Minister Sri Mulyani Indrawati to all government sectors to try to keep the state budget in line.

The government has also been considering other fiscal measures such as boosting both tax and non-tax revenues and improving cost efficiencies at oil company Pertamina and electricity company Perusahaan Listrik Negara (PLN).

The government is also planning to ask oil producing provinces in the country to use any windfall from the spike in oil prices to invest in treasury bonds issued for purposes of covering the budget deficit.

The 2008 state budget was approved by parliament in October last year.

Earlier this month the government proposed a revision following soaring oil prices, fallout from the subprime crisis in the United States and assumptions of a slowdown in global and domestic economic growth.

Under the proposal, the budget deficit is expected to widen to 86.83 trillion rupiah (S$13.4 billion) or two per cent of gross domestic product from its initial forecast of 73.31 trillion rupiah or 1.7 per cent of GDP. -- AFP