Jakarta – Public Works and Public Housing Minister Basuki Hadimuljono said that the ministry would still achieve its year-end targets despite lower-than-expected spending that barely reached 50 percent with two months left.
As of Oct. 13, the ministry recorded spending of 45.29 percent, or Rp 53.7 trillion (US$3.97 billion), of the Rp 118.6 trillion ($8.72 billion) earmarked for the ministry in the revised 2015 state budget. That was lower than last year's spending of Rp 44.7 trillion (58.49 percent of the allocated budget) by the same period.
"I think with the present data, we will still miss 2 percent to 3 percent of the target, but we will try to achieve the spending target by the end of the year," Basuki said recently during an annual review of the ministry's work.
The ministry planned to spend as much as 56.16 percent of the budget by the end of October and to achieve 93 percent spending by the end of December.
He also reported that the ministry had already made progress on various infrastructure developments, such as toll roads, dams and low-cost housing, throughout the year, with physical infrastructure realization reaching 51.42 percent as of Oct. 12.
The government's slow spending has weakened the nation's efforts to stoke growth, which has slowed to its lowest level since 2009 in the last two quarters. Economists have also pinned hopes on infrastructure spending to increase growth a notch in Southeast Asia's largest economy.
The Public Works and Public Housing Ministry is also seen as crucial to President Joko "Jokowi" Widodo's infrastructure push, including in frontier areas and the eastern part of Indonesia.
Basuki said that development had been robust, as marked by the rising amount of building materials from quarter to quarter. The ministry used 2.48 million tons of cement in the first three quarters of the year and would use an estimated 2.89 million tons more in the last quarter.
The ongoing progress of the development this year included the trans-Java road project, the trans-Papua road project, frontier roads such as in East Nusa Tenggara, the signing of some toll road projects like the Manado-Bitung highway in North Sulawesi and the development of the Samarinda-Balikpapan highway in East Kalimantan.
The ministry will also speed up the development of its projects to reach the target, which also included projects from the previous administration.
Among others, it aimed to build 13 dams this year, including the Raknamo dam in East Nusa Tenggara, the Lolak dam in North Sulawesi and the Keureuto dam in Aceh, from the budget of Rp 30.56 trillion earmarked for the water resources directorate general.
However, to date, the ministry has only signed contracts for 10 of the dams, leaving three dams, the Rotiklod in East Nusa Tenggara, the Sindang Heula in Banten and the Bintang Bano in West Nusa Tenggara, to be signed during the balance of the year. It also has the obligation to finish the development of 16 dams started by the previous administration.
"We should be able to finish the development of at least seven dams this year," said Mudjiadi, the ministry's director general of water resources.
The ministry also reported having built more than 493,000 low-income housing units for the poor to date from the target of around 603,000 houses, as part of its 1 million houses program to solve the housing backlog in the country.
It hoped that the new deregulation in the economic package that would simplify housing development permits from the required 42 permits in 26 months to eight in 14 days would attract housing developers to take part in the program. (fsu)