The Center for Regional Studies and Information (PATTIRO) asked the Ministry of Home Affairs (Kemendagri) to pay attention to the allocation of grants submitted by local governments in the 2014 fiscal year. PATTIRO sees that currently, the allocation of grants in the regions tends to increase and it is feared that regional heads will take advantage of grant spending for their political interests, especially the incumbent who wants to run again in the Regional Head Election (Pilkada). Even though the Minister of Home Affairs (Mendagri) Gamawan Fauzi advised that the implementation of the 43 regional elections in 2014 be postponed a year, because of the legislative and presidential elections, the grant funds could have been used for the political interests of one of the parties currently in power in the area.
The results of the study by the PATTIRO budget research team on APBD in 8 (eight) provinces, namely the provinces of Banten, East Java (East Java), East Nusa Tenggara (NTT), Nusa Tenggara (NTB), Papua, South Sumatra (South Sumatra), DKI Jakarta, and West Java (West Java) for the 2011 to 2013 fiscal year, it was found that most of the provinces that held regional elections in that year increased grant spending quite significantly from the previous year. For example, in the Province of NTT, which held Pilkada in 2013, the budget allocation for grant spending reached IDR 973 billion or 41% of the total APBD. This number has increased by 4% from 2012 and this figure is quite fantastic because it absorbs almost half of the total APBD spending.
In addition to NTT, the Province of NTB, which also held regional elections in 2013, has budgeted grants of 30% of the total APBD expenditure or IDR 744 billion. This number increased very sharply, namely 539% from 2011 which only allocated 8% or Rp. 138 billion. Likewise, the provinces of West Java and East Java, both of which also held Pilkada in 2013, have budgeted grants of more than 30 percent of total APBD spending. (Graphs and tables of increasing grant spending in 8 provinces can be found in full in the attached file)
The large number of regions that allocate grants above 30% of the total APBD spending, especially during the Pilkada events, must receive serious attention from the Ministry of Home Affairs. It is feared that the increase in spending on grants will suck up the budget for public services, such as the budget for the health sector. In several provinces, the budget for health has decreased in percentage terms. The budget for the health sector in Banten Province decreased by 1% in 2012. In the province of East Java, the budget for health in the last three years has continued to decline from 15% in 2012 to 13% in 2013. The same is true for the provinces of NTT and South Sumatra. (Graphs and tables for reducing the health budget in 8 provinces in full can be found in the attached file)
Not only in the health sector, if this thing continues, then development priorities in other public service sectors, such as education or infrastructure, will definitely be sidelined. Apart from that, it should be suspected, the grant funds will only be a venue for distributing money in the name of financial assistance for development by the incumbent during the elections. Based on an investigation into the DKI Jakarta Grants and Social Assistance budget conducted by IBC (Indonesian Budget Center) during the 2012 DKI Jakarta Regional Election, many recipients of the Grants and Social Assistance funds were found with fictitious addresses.
Actually, the use of grant spending has been regulated in the Regulation of the Minister of Home Affairs (Permendagri) No. 32 of 2011 and its amendments, namely Permendagri No. 39 of 2012 concerning Guidelines for Giving Grants and Social Assistance Sourced from the Regional Budget. In this rule, the Regional Head is required to include a list of recipient names, recipient addresses and the amount of grants in the Elaboration of the APBD, so that the public knows where this Grant Expenditure will be given by the Regional Government. However, in practice, many regions do not comply with this regulation, so that the public does not know where this grant is being spent.
In addition, these two Permendagri have also strictly regulated the provision of grant spending. For example, one of the responsibilities of the local government for awarding this grant should include an integrity pact from the grantee stating that the grant received will be used in accordance with the Regional Grant Agreement Manuscript (NPHD).
Seeing these problems, PATTIRO recommends:
- When the Minister of Home Affairs evaluates the APBD for the Provincial APBD, and the Governor for the Regency/City APBD), the APBD evaluator team at the Ministries and Province levels must pay attention in detail to the use of grant spending proposed by each regional head in the RAPBD document. The evaluator team, not only looks at conformity with regulations, but also needs to see whether the RAPBD that has been approved together with the DPRD has carried out its 3 (three) main functions, namely allocation, distribution and stabilization functions.
- The Minister of Home Affairs needs to make stricter rules regarding the obligation of regional governments to announce or publish the allocation of grant spending, so that during implementation, the public can supervise the use of grant spending, so as to promote accountability for grant funds.
Jakarta November 27, 2013
Sad Dian Utomo | PATTIRO Executive Director
saddian@pattiro.org | 0812 800 3045
Contact Person: Fitria Muslih | Budget Specialist
fitria@pattiro.org
