Law Number 5 of 1979 concerning Village Government is no longer valid since the government passed Law Number 6 of 2014 concerning Villages. One thing that differentiates the Village Law and the Village Government Law is the clause regarding village funds. Village funds are funds provided by the central government originating from the State Revenue and Expenditure Budget. Previously, villages received funds from balance funds or transfers from the central government to regional governments, both provincial and district.
At the beginning of 2016, the public, especially the government and village communities, were confused by President Joko Widodo’s statement instructing village funds in 2016 to be used to develop sectors that could make villages more productive. President Jokowi even underlined that village funds should be used as maximally as possible to build self-managed village infrastructure. This presidential instruction was often conveyed by the Minister of Villages, Development of Disadvantaged Regions and Transmigration (Kemendesa PDTT) Marwan Jafar on various occasions, including during a friendly event between the Ministry of Villages PDTT and civil society in Jakarta in January 2016.
Many parties consider the statement by the president and Minister Marwan to be inconsistent and contrary to the PDTT Village Minister Regulation Number 21 of 2015 concerning Priority Use of Village Funds.
For further discussion, please read the Fact Sheet: Priority Use of Village Funds by downloading the .pdf file below.