Dede Leni Mardianti, Jakarta – The head of Prawatan Village in Klaten, Central Java, Sabiq Muhammad, alongside the chair of the Lestari State Edukarya Cooperative, Muhammad Tauhid Aminullah, and the Sajogyo Institute, filed a judicial review challenging several legal provisions regarding the implementation of the Red and White Cooperative at the Constitutional Court (MK) on Tuesday, October 27, 2026.
The petition was registered under Case Number 399/PUU-XXV/2026. The three petitioners are backed by the Coalition to Sue Red and White Village Cooperatives, which comprises the Center of Economic and Law Studies (CELIOS), Themis Indonesia, Indonesia Corruption Watch (ICW), Transparency International Indonesia, Trend Asia, and Solidarity of Women New Cooperative Indonesia.
Legal counsel representative Muhammad Saleh stated that the lawsuit challenges the top-down establishment of cooperatives via government directives, the diversion of village funds to finance central government initiatives, and the financial exposure forced onto rural communities. According to him, these policies have eroded the petitioners' authority to set localized development priorities while undermining members' constitutional rights to manage the cooperatives.
On these grounds, the petitioners are asking the Constitutional Court to halt the implementation of the Red and White Village Cooperative under its current operational framework. "Essentially, we are asking the Constitutional Court to immediately stop the command-style management model for cooperatives currently practiced by the Prabowo-Gibran administration, which violates constitutional mandates and statutory rules," Saleh told reporters at the Constitutional Court building in Jakarta on Tuesday, October 27, 2026.
The petitioners are challenging several clauses across the Village Law, the Cooperative Law, and the Law on Financial Relations between the Central Government and Regional Governments (HKPD). The contested provisions pertain to central government assignments delegated to villages, village fund spending priorities, village decision-making assemblies, and cooperative principles and oversight.
Saleh cited Article 22 paragraph (2) of the Village Law, which mandates that any government assignment given to a village must be matched with dedicated funding. However, he argued that the Red and White Village Cooperative initiative operates in complete opposition to this principle. "Village funds, which have historically carried basic village administrative functions, are being commandeered by the central government in a top-down manner to finance cooperatives managed by the central government," Saleh said.
Saleh emphasized that redirecting village funds to finance this scheme hampers localized public services and rural infrastructure development. Many village administrations, he noted, can no longer cover the salaries of early childhood education (PAUD) teachers. Furthermore, Saleh pointed out that numerous village-owned enterprises (BUMDes) and local road repair projects have ground to a halt.
In their formal plea, the petitioners request the Constitutional Court to declare Article 22 paragraph (2) of the Village Law conditionally unconstitutional unless interpreted to mean that every central assignment to a village must come with adequate, dedicated funding from the assigning authority's budget. That financial backing, they argue, must be earmarked separately from the core revenues villages rely on to exercise their autonomous authority.
Additionally, the petitioners are asking the Constitutional Court to order the government to suspend the current operational model of the Red and White Village Cooperative until a revised framework fully compliant with the Cooperative Law is established.
Source: https://en.tempo.co/read/2122460/lawsuit-filed-against-red-and-white-cooperative