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Regions Slammed for Wasteful Spending

Regional autonomy has once again come under scrutiny as many provincial, regency and municipal administrations have been accused of performing poor­ly, as reflected in budget disburse­ment for half-baked projects.

Regional autonomy has once again come under scrutiny as many provincial, regency and municipal administrations have been accused of performing poor­ly, as reflected in budget disburse­ment for half-baked projects.

Administrative and Bureau­cratic Reform Minister Asman Abnur has said administrations in at least 193 of the nation’s 548 provinces, regencies and munici­palities had failed to roll out pro­grams that supported their devel­opment goals.

The mismatch between plan­ning and outcomes has report­edly led to the wastage of Rp 400 trillion (US$30.1 billion), or about one-fifth of the state budget.

"[For example] constructing irrigation [systems] while there is a lack of paddy fields, or building a dam for irrigation but not includ­ing the construction of the ca­nals,” said Asman.

The National Mandate Party politician also noted that there were too many official trips, meet­ings at hotels and projects with vested interests behind them.

The minister said he would en­courage local governments with good performance, such as the provinces of West Java, East Java and Yogyakarta, to help push oth­er regents and mayors to revamp their performances.

An Evaluation of Performance Accountability of Government Agencies (LHE AKIP) report is­sued by the Administrative and Bureaucratic Reform Ministry in 2016 revealed that 24 provin­cial administrations and 456 re­gencies and cities still lacked ac­countability, scoring below 70, meaning a C grade.

The low bureaucratic capac­ity has reportedly been the main source of the poor budget plan­ning and implementation.

The Regional Autonomy Watch (KPPOD) revealed that from its monitoring, regions that were still unaccountable with its budget spending included, among others, Maluku, Papua, Aceh, and most provinces in Kalimantan ex­cept Central Kalimantan.

“In our view, there is a ten­dency for regions in remote ar­eas that are far away from cen­tral government supervision and not monitored by mass media to have less budget accountability,” KPPOD executive director Rob­ert Endi Jaweng told The Jakar­ta Post.

The discrepancy between bud­get spending and outcomes of programs is, in fact, an old issue that results from several factors, including sluggish bureaucratic reform and budgetary politics, Robert said.

“It’s not about budget absorp­tion, but the quality of spending. A significant part of the budget is spent without significant im­pact. The programs lack focus and therefore create only wasteful spending,” Robert said.

“The poor capabilities of bu­reaucrats is also worsened by cor­ruption.”

Robert further slammed the lack of central government mea­sures for evaluating accountabil­ity and effectiveness of budget disbursement at the local level, saying that it only focused on en­couraging more budget absorp­tion to boost local economies.

Under the current system, re­gional transfers that include gen­eral allocation funds (DAU), spe­cial allocation funds (DAK) and revenue sharing funds (DBH) are automatically sent by the central government to regional adminis­trations every three months.

The Home Ministry’s regional finance directorate-general sec­retary, Indra Baskoro, acknowl­edged the problem of inefficient spending, saying that many ad­ministrations still allocate a ma­jor part of the budget for person­nel spending.


“While the target on spending of special allocation funds [DAK] is already clear, the disbursement of general allocation funds [DAU] is still problematic since it is of­ten not in-line with targeted out­comes of programs,” Indra said.

Indra went on to say that such unnecessary disbursement of re­gional budget funds would be the main issue addressed in the up­coming 2018 guidelines for re­gional budget drafting, which is currently being drafted by the Home Ministry.

The guidelines, expected to be finalized in late May this year, will provide.clear guidance for region­al administrations to optimize their budgetary spending for pro­grams and projects that are in­line with national priorities.

 

(Jakarta Post, 17 April 2017)

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