Differences In Village Funds And ADD: Here's An Explanation And Understanding

Differences in Village Funds and ADD (Mufid Majnun Image - Unsplash)

YOGYAKARTA - Have you heard the terms DD (Village Fund) and ADD (Village Fund Allocation) in financial management in the village? But in fact, until now there are still those who like to be confused with the terms DD and ADD. Want it in terms of terms, functions or terms of source origin of allocation. In fact, we often encounter people calling Village Funds (DD) as Village Fund Allocations (ADD) or vice versa, although both are for villages and are sources of village income. So what is the difference between village and ADD funds?

The comparison of Village Funds and Village Fund Allocations is in the source of the funds.

The Village Fund comes from the APBN, while the Village Fund Allocation comes from the APBD, which is a minimum of 10% from DAU plus DBH. (Reported from the Ministry of Finance's DJPK page).

The Village Fund Roadmap is a form of state recognition to villages. The Village Fund can be used and utilized to increase public services in villages, advance the village economy, tackle the development gap between villages and strengthen villagers as subjects of development. Meanwhile, this ADD comes from part of the central financial balance fund and the area received by the Regency or City after that is allocated to villages.

Definition of Village Funds (DD)

In the Village Law which is rewritten in Government Regulations (PP) and has experienced several changes as implementers of the mandate of the Village Law.

Mentioned in Government Regulation No. 43 of 2014, article 1 point 8 if the interpretation of Village Funds or abbreviated (DD) is:

Village Funds are funds sourced from the State Revenue and Expenditure Budget (APBN)

which is intended for villages that are transferred through the Regency/City Regional Revenue and Expenditure Budget (APBD) to finance government administration, implementation of development, community development, and empowerment of residents (PP 43 of 2014, chapter I article 1 number 8).

Priority for the use of Village Funds (DD) is regulated in the Regulation of the Minister of Villages, Development of Disadvantaged Regions and Transmigration which is issued every year before the next fiscal year runs.

Understanding Village Fund Allocations (ADD)

Understanding Village Fund Allocation (ADD) is regulated in Government Regulation No. 43 of 2014, article 1 point 9 which reads as follows:

The Village Fund Allocation is a balance fund received by Regencies/Cities in the Regional Revenue and Expenditure Budget (APBD) after deducting the Special Allocation Fund (DAK).

The amount of Village Fund Allocation (ADD) is regulated in Article 96 paragraph 1 and 2 PP 47 of 2015 to change to PP 43 of 2014 as the implementing regulation of the Village Law which reads as follows:

Differences in Village Funds (DD) and Village Fund Allocations (ADD)

From the above understanding, of course, we can distinguish Village Funds (DD) and Village Fund Allocations (ADD).

Village Funds are the obligations of the Central Government allocated in the APBN. Distribution of Village Funds directly to the Village via Village Cash Account (RKD) through the Universal Regional Cash Account (RKUD) as storage while Village Funds.

On the other hand, the Village Fund Allocation (ADD) is the obligation of the Regency/City Government to allocate it into the APBD through the balance fund after deducting the Special Allocation Fund (DAK) and then channel it to the Village Treasury Account (RKD).

The amount of receiving Village Fund Allocations (ADD) for each Village is regulated in calculations made by the Regency/City Government by observing the method procedures that have been regulated by Government Regulations (PP) which after that are outlined in the Regent/Mayor Regulation.

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