Dion Bisara – Legislators and businessmen on Monday criticized the government for the slow disbursement of stimulus funds, and argued that the delay could jeopardize national economic growth.

An Investor Daily report on Monday quoted National Development Planning Minister Paskah Suzetta as saying that by the end of May, only 2 percent of Rp 12.2 trillion ($1.2 billion) earmarked for stimulus-related infrastructure projects had been disbursed.

The infrastructure projects were part of a Rp 73.3 trillion stimulus package agreed on by the government and the House of Representatives budget commission in February.

Most of the funds were allocated to just a handful of ministries, including Rp 5.57 trillion for public works and approximately Rp 2.24 trillion for transportation.

"If the money is not disbursed quickly, growth could be lower than expected," said Melkias Mekeng, a member of House Commission XI, which oversees finance and banking.

The government last week cut the growth forecast for the year to 4.3 percent, from an earlier forecast of 4.5 percent, due to the global economic crisis.

Melkias blamed the disbursement delays on the tendering mechanism and a lack of general preparedness by public servants. Ministry officials are also said to be reluctant to spend public money because of fear of being accused of corruption.

"The stimulus is a big program," Melky said. "Ideally, all programs should start in January. But in reality, there are regions that will only start their infrastructure programs in October."

Sofyan Wanandi, chairman of the Indonesia Employers Association (Apindo), criticized the delay, arguing that 50 percent of the funds should have been distributed by this point.

"Two percent disbursed means the stimulus has failed," said Sofyan, a known supporter of presidential candidate Jusuf Kalla. "It has to be sped up. We're in the middle of the year now."

If the government fails to clear the "maze of bureaucracy" and pressure ministries to accelerate the program, it will be difficult for the government to prevent rising unemployment. The country needs at least 7 percent annual growth to keep pace with the demand for jobs.

Anny Ratnawati, director general of budgets at the Finance Ministry, defended the stimulus program, saying that the government disbursed most project funds after the completion of projects. "Fund disbursement is different from physical work," Anny said.