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Government calls for prudent, transparent spending of village funds

Jakarta Post - December 28, 2015

Ganug Nugroho Adi and Ruslan Sangadji, Boyolali, Central Java/Palu – With the government set to increase the allocation of dana desa (village fund) in the upcoming year, President Joko "Jokowi" Widodo has called on local officials to use the budget in a prudent and transparent manner so as to help them avoid any future legal hassles.

Speaking in front of 3,000 subdistrict leaders and officials during a gathering on Saturday in Boyolali, Central Java, President Jokowi said that local leaders must follow government-sanctioned procedures on how to spend the budget in order to avoid being prosecuted for embezzlement.

"If all of you work in accordance with existing procedure, there should be no criminalization. I personally guarantee that prosecutors and police will not touch you. I will grant an award to those who show excellent performance [in making use of the funds]," he said.

During his speech, President Jokowi announced that his government had allocated Rp 47 trillion (US$3.4 billion) for dana desa from the state budget, double what had been disbursed for the same post this year. In 2017, he continued, the government would increase the allocation to between Rp 60 trillion and Rp 80 trillion.

Jokowi also reminded local officials to spend dana desa to speed up local development by prioritizing the use of local resources.

"If you need to spend the money outside your village, don't make it more than 10 percent. The more money circulating within a village, the more productive the village will be," he said.

In December 2013, all political factions in the House of Representatives unanimously passed the Village Law, a new regulation that, the government claimed, would improve the welfare of people living in the country's 73,000 subdistricts. Former president Susilo Bambang Yudhoyono signed the law in January 2014.

Under the new law, all subdistricts across the country share funds equal to 10 percent of the state budget earmarked for regional administration, in the hope of reducing inequality and poverty. Every subdistrict is to receive a certain amount based on several factors, including population size and poverty level.

The law stipulates that the annual fund is to be disbursed in three stages: 40 percent in the first stage, 40 percent in the second and the remaining 20 percent in the third.

Despite its strategic objectives, the village fund disbursement has sparked criticism, including questions with regard to the ability of local officials to manage the funds as well as to properly plan and execute a development project.

Earlier this month, the Poso regional administration in Central Sulawesi, for example, reported that 62 out of 142 subdistricts in the region had yet to submit the financial accountability report required to withdraw the final stage distribution of this year's dana desa.

"Subdistrict officials have thus far found it difficult to make a financial accountability report for every fund disbursement stage, resulting in late fund disbursement for the next stage," acting Poso Regent Sin Songo said.

This year, the government has allocated Rp 37 billion in dana desa for Poso, with every subdistrict in the regency receiving around Rp 250 million.

Meanwhile in Rembang, Central Java, the regional administration has requested that all subdistrict administrations within its jurisdiction detail plans for dana desa use in its respective annual budget (APBDes).

Head of the regency's Cemoro subdistrict, Jidan, said that such a strategy is an effective way to prevent budget misappropriation.

"In Rembang, our regent has instructed us to make a monthly report on how we have used dana desa. Copies of these reports are to be placed on the information board at the subdistrict's office so that the villagers know where the money is going," he said.

Source: http://www.thejakartapost.com/news/2015/12/28/govt-calls-prudent-transparent-spending-village-funds.html