Indonesia, a nation of over 280 million people, has been rocked by a political and economic storm that culminated in a dramatic Cabinet shake-up on September 8, 2025. President Prabowo Subianto, facing a tide of public anger and deadly protests, announced the removal of five key ministers, including the highly respected Finance Minister Sri Mulyani Indrawati and the Coordinating Minister for Politics and Security, Budi Gunawan. The move came after days of unrest sparked by revelations about lawmakers’ generous perks, which many Indonesians saw as a slap in the face during tough economic times.
The protests, which swept across the archipelago for five days, were triggered by reports that all 580 members of Indonesia’s House of Representatives receive a monthly housing allowance of 50 million rupiah—about $3,075. To put that in perspective, it’s nearly ten times the minimum wage in Jakarta. According to the Associated Press, this allowance was introduced in 2024, but the news only recently stoked outrage, with critics calling it both excessive and deeply insensitive as ordinary people struggle with soaring costs of living, rising taxes, and growing unemployment.
The demonstrations quickly turned violent. The National Commission on Human Rights (Komnas HAM), an independent watchdog, reported that ten people died during the five days of unrest, attributing most fatalities to what it described as the inhumane approach taken by security forces. Police, however, put the death toll at seven. Among the victims was 21-year-old ride-hailing driver Affan Kurniawan, who, according to AP, was completing a food delivery order when an armored police vehicle sped through a crowd, causing him to fall. His death became a rallying cry for protesters, fueling further anger on the streets.
The unrest wasn’t limited to the public squares. On August 31, just days before the Cabinet reshuffle, looters targeted the home of Sri Mulyani Indrawati in South Tangerang, on the outskirts of Jakarta, as well as the residences of several lawmakers. These acts of vandalism underscored the depth of public frustration and the sense that Indonesia’s elites were out of touch with the struggles of ordinary citizens.
President Subianto, under mounting pressure, moved to quell the unrest by revoking lawmakers’ perks—including the controversial housing allowance—and suspending all overseas trips for members of parliament. According to AP, these steps helped restore a measure of calm, but the president went further, announcing the dismissal of five Cabinet members. Alongside Indrawati and Gunawan, the ministers for cooperatives, youth and sport, and migrant workers protection were also removed. The latter, Abdul Kadir Karding, had recently drawn criticism after being photographed playing dominoes with a former illegal logging suspect—a move that didn’t sit well with a public already on edge.
The most closely watched departure was that of Finance Minister Sri Mulyani Indrawati, a technocrat with an international pedigree. Indrawati, who previously served as executive director of the International Monetary Fund and managing director of the World Bank, was widely credited with maintaining Indonesia’s fiscal discipline and boosting the country’s reputation among global investors. As reported by both AP and ABC News, her credibility was seen as a key asset, helping to attract investment and keep the economy stable even during turbulent times.
Yet, as Fadhil Hasan, a senior economist at the Institute for Development of Economics and Finance, explained to the Associated Press, Indrawati’s position had become increasingly complicated. "In recent years, Indrawati had accommodated many presidents’ ambitious programs, which resulted in increasing the government debt and diminishing the credibility of her own fiscal policy," Hasan observed. The balancing act between supporting government initiatives and maintaining fiscal prudence had become ever more precarious, and ultimately, it may have contributed to her ouster.
To fill Indrawati’s shoes, President Subianto tapped Purbaya Yudhi Sadewa, chairman of the Deposit Insurance Corporation. While Sadewa is recognized as a capable economist, his appointment raised eyebrows among observers. "So, I don’t think he’s the best choice," Hasan commented, pointing out that Sadewa lacks a proven track record in managing the nation’s fiscal and state finances. This sentiment echoed through financial markets, as Indonesian stocks took a hit following the announcement. The Jakarta Composite Index closed down 1.28% at 7,766.85, shedding over 100 points, while the rupiah actually strengthened 0.75% against the U.S. dollar to 16,309—a sign that investors were both jittery and reassessing the country’s economic direction.
The protests themselves were about much more than just lawmakers’ perks. Analysts cited by AP see them as the culmination of deeper, long-simmering frustrations over economic mismanagement, widespread layoffs, and declining purchasing power. For many Indonesians, the housing allowance scandal was the final straw—a symbol of a government and parliament perceived as indifferent to the daily struggles of ordinary people.
Amid the chaos, the government’s heavy-handed response drew sharp criticism from human rights groups. Komnas HAM’s report highlighted the "inhumane approach by security forces in handling the demonstrations," and the death of Affan Kurniawan became emblematic of the risks faced by ordinary citizens caught up in political turmoil. The fact that violence erupted in the streets of one of Southeast Asia’s most important economies sent a sobering message to both domestic leaders and international observers.
President Subianto’s decision to revoke perks and privileges, suspend overseas trips, and reshuffle his Cabinet was clearly aimed at restoring public confidence and stabilizing the situation. Whether these moves will be enough to address the underlying economic and political grievances remains to be seen. The appointment of new ministers, particularly in the finance and security portfolios, signals an attempt to chart a new course, but as the reaction from financial markets and experts suggests, the road ahead may be bumpy.
For now, calm has returned to Indonesia’s streets, but the events of early September 2025 have left a mark on the country’s political landscape. The protests, the violence, and the subsequent government shake-up have exposed the fragility of public trust and the challenges facing Southeast Asia’s largest democracy as it navigates a period of uncertainty and change.