Minister Of Finance Highlights Regional Funds Depositing, Bojonegoro Is An Example

JAKARTA - Minister of Finance Purbaya Yudhi Sadive also highlighted that there are still many local governments that have closed the budget year with large funds that have not been absorbed.

He assessed that this phenomenon shows the low effectiveness of regional financial management, because funds deposited in the regional treasury do not make a real contribution to the economy.

In the Regional Inflation Control Coordination Meeting, Monday, October 20, Purbaya specifically mentioned Bojonegoro Regency, East Java, as an example of an area with a very large remaining budget.

Before I talk, I'll ask you first, sir (Minister of Home Affairs Tito Karnavian) yes. That's if the regional budget can be a deficit or a surplus or not? Or must it be a balance every year?" he said.

Responding to this, Minister of Home Affairs Tito Karnavian explained that local governments are generally directed to have a surplus budget so that financial reserves are available and avoid deficit conditions.

"Generally, sir (Purbaya), they have to surplus, sir, so there is a reserve. And then if they have a deficit, then if they don't have to take it from SILPA, sir, or they owe it, sir," he replied.

Tito added that a number of regions also borrowed funds from the Ministry of Finance through PT Sarana Multi Infrastruktur (SMI), for infrastructure.

"We expect all of the targets to be in surplus so that the income is more than spending," he added.

Purbaya then asked further, does the central government have the authority to withdraw the surplus funds. "(Director General of Financial Balance of the Ministry of Finance) Mr. Askolani, can we take the surplus of money? " he said.

The Director General of Fiscal Balance at the Ministry of Finance Askolani said that the funds were legally stored as regional deposits within certain limits.

However, he added that the central government continues to encourage the funds to be immediately used to finance productive activities, especially at the beginning of the fiscal year.

In addition, Purbaya again highlighted the Bojonegoro case, which is said to have left more than Rp. 3 trillion unused funds at the end of the fiscal year. "If you are rich in Bojonegoro, there are trillions that are not used, more than Rp. 3 trillion will not be used at the end of the year, what do you want to do?" he asked.

Meanwhile, Askolani replied that the government would continue to encourage the budget to be spent immediately in the following year. "We encourage it to be used next year, sir, at the beginning of the years, for shopping," he replied.

However, Purbaya reiterated that if the funds continue to settle, the economic benefits will be minimal, especially considering that Bojonegoro is an area with great potential from the oil and gas sector managed by ExxonMobil.

"The local government's goal is not to save, but to increase economic growth," he said.