President Joko “Jokowi” Widodo said that up to Rp 278 trillion in the regional budgets was still unused and kept in banks. The figure is higher than that of previous years.
By
NINA SUSILO
·5 minutes read
KOMPAS/DIONISIUS REYNALDO TRIWIBOWO
Indonesian Minister of Home Affairs Tito Karnavian (second left) with regional heads throughout Central Kalimantan after the Coordination Meeting for the Acceleration of the Realization of Regional Budgets (APBD) in Central Kalimantan Province, Thursday (27/5/2021).
JAKARTA, KOMPAS — The classic problem of the low disbursement of regional budgets has again occurred. With just one month left until the 2022 fiscal year ends, President Joko “Jokowi” Widodo said that up to Rp 278 trillion in the regional budgets was still unused and kept in banks.
Regional heads have been asked to spend the budget immediately. To ensure that the problem will not reoccur, however, the causes of the slow disbursement of the state budget, partly originating with the central bureaucracy, must be addressed first.
In his speech to open the 2022 National Investment Coordination Meeting in Jakarta on Wednesday (30/1/2022), the President revealed that a large amount of the regional budgets was still in banks.
“We have been looking for money from outside to increase the money in circulation. But our own money that was transferred by the Finance Minister to the regions remain unused," said the President.
Citing data from the Finance Ministry, the President said Rp 278 trillion of the state budget remained unused in banks. The figure is higher than that of previous years. Usually, in the same month in previous years, the amount of idle funds ranged between Rp 210 trillion and Rp 220 trillion.
“Rp 278 trillion is a huge amount. If this is realized quickly, it will have an impact on regional economic growth," the President added.
According to Kompas’ records, the President complains about the slow disbursement of regional budgets almost every year. At the end of November 2021, for example, the President revealed that Rp 226 trillion from regional budgets were still in the banks. In April 2016, the President said Rp 183 trillion from regional budgets remained unused in banks.
FAKHRI FADLURROHMAN
Officers from the Cleanliness Implementation Unit for the Water Agency cleaned the Ciliwung river, Central Jakarta, Monday (11/14/2022). The DKI Jakarta Regional People's Legislative Council approved the 2023 DKI Jakarta Regional Revenue and Expenditure Budget Draft (APBD) of IDR 82.5 trillion.
No intention
Bogor Mayor Bima Bima Arya, who is also the chairman of the Association of Indonesian Municipalities (Apeksi), said it was untrue that regional heads had deliberately withheld the state funds.
Slow disbursement of the state budget has often occurred due to the late disbursement of the special allocation funds (DAK) and the regional incentive funds (DID) by central government. This has then caused a delay in the issuance of implementing, technical, and finance minister regulations to be used as guidelines for disbursing the budget.
For example, Bima said, information on the transfer of the DID to the Bogor municipal administration had been received only on Wednesday. It was almost certain that the fund could not be used, as the implementation period was very short, with only one month left to the 2022 fiscal year.
Bima said another problem was the fear among those in charge of disbursing the funds that they might deal with law enforcement officers because the unclear guideline on the funds’ use. As a result, they chose not to spend the funds, even though this went against the intentions of their superiors, the regional heads.
Meanwhile, the head of Government and State Apparatus Empowerment at the Association of Regency Administrations (Apkasi), Nikson Nababan, agreed that the slow disbursement of the state budget was due to a delay in transferring the funds at the central government. Regional administrations were faced with at least two obstacles in realizing their budgets.
First, the National Public Procurement Agency (LKPP) usually released the latest e-catalog (on state procurements) only in May. "My suggestion for 2023 is for the LKPP to release the e-catalog in December 2022 or no later than January 2023, so that purchasing goods through the e-catalog can start at the beginning of next year," he said.
Tenders for the procurement of goods and services were also considered problematic because the process was time-consuming. Therefore, he proposed that the limit on the value of goods and services procurement through direct appointments could be increased, but that it must be accompanied by technical guidelines to ensure that the appointed company had the experience, capacity, and tools to carry out the work.
Breakthrough
Djohermansyah Djohan, a professor of regional public administration, and Herman Suparman, executive director of the Monitoring Committee for Regional Autonomy Implementation, when interviewed separately, also called on the central government to not just blame regional administrations. Instead, the central government needed to make a breakthrough and improvements.
Djohermansyah said, for example, that the guidelines for disbursing funds from the state budget should be issued earlier. They should also be made easier for the regional governments to follow. In addition, monitoring the disbursement of the regional budgets must be stricter.
This way, if regions were slow to disburse their budgets, an immediate solution could be found.
Herman added separately that there was a need for an approach based on incentives and disincentives. Regional officials such as regional heads and regional legislators who were late in disbursing the funds should be subject to sanctions. For example, they could be prohibited from being granted financial authority for a certain period.
This article was translated by Hendarsyah Tarmizi.
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