Inefficient Use of Indonesia's State Budget; Fake Villages & Local Public Officials’ High Travel Expenses
It is assumed by many that the Indonesian government does not make efficient use of the annual state budgets. This is also the reason why Indonesian President Joko Widodo stated recently that one of his key ambitions for the next five years is to make more efficient use of the state budget (“each rupiah of the state budget needs to be used productively”).
Over the years there have been many news stories in Indonesian media that strengthen the assumption that Indonesia does not make efficient use of the state budget. For example, there have often been stories about how funds from the central government’s Transfer to the Regions budget (in Indonesian: Transfer ke Daerah) and Village Funds budget (Dana Desa) remain unused, staying idle on deposit accounts, implying missed opportunities for economic and social development in the regions and villages.
Meanwhile, there have also been many news stories in local media about how corrupters – whether at the central or regional levels of governance – cause state funds to disappear, for example through fake/fictive invoices in public projects.
In November 2019 two new issues came to the fore that cause concern about how state budget funds (some 75 percent of which originate from tax revenue) are being used in Indonesia. These two issues are (1) the presence of fake/fictive villages, and (2) the expensive travel expenses of regional public officials.
Read the full article in the November 2019 edition of our monthly report. You can purchase the report by sending an email to info@indonesia-investments.com or a WhatsApp message to the following number: +62(0)8788.410.6944
