The Ministry of Home Affairs Says 39 Districts Have Difficulty Paying PPPK Salaries

JAKARTA - The Ministry of Home Affairs (Kemendagri) revealed that Central Sulawesi is one of the 39 regions in Indonesia that face difficulties in meeting the payment of salaries of Government Employees with Work Agreements (PPPK) due to the high cost of employee spending in the Regional Revenue and Expenditure Budget (APBD).

Minister of Home Affairs Tito Karnavian said that the condition needed to be immediately solved because the fiscal capacity of a number of regions was increasingly limited after the addition of apparatus through the recruitment of PPPK.

"If I'm not mistaken, there are 39 areas that we need to think about. Maybe they, if they rely on local original income, will also be difficult, so they need to be supported through transfers to the region (TKD)," said Tito, Tuesday, June 9.

According to Tito, the high proportion of employee spending is the main factor that puts pressure on the fiscal space of local governments. As a result, the allocation of the budget for development and public services is becoming increasingly limited.

In Central Sulawesi, a number of areas recorded a share of employee spending that was far above the ideal limit set by the government. The Central Sulawesi Provincial Government has a share of employee spending of 56.65 percent of the total APBD. Meanwhile, Donggala Regency reached 53.1 percent and Sigi Regency around 60 percent.

"Then Sigi is spending 60 percent of employees. Well, this is what needs to be done, find a solution," said Tito.

The government through the Law on Financial Relations between the Central Government and Regional Governments has actually set a maximum limit for employee spending of 30 percent of the APBD. However, until now, there are still many regions that have not been able to meet this provision.

Data from the Ministry of Home Affairs shows that as many as 367 regencies still have a spending share for employees above 30 percent. On the other hand, only 48 regencies have managed to reduce employee spending below the threshold.

To overcome this problem, the government will gradually adjust the structure of the APBD before the maximum spending limit for employees is fully implemented on January 5, 2027.

The Ministry of Home Affairs has also issued a circular asking local governments to evaluate budgets and prioritize spending that has a direct impact on the community.

In addition, the regions are asked to reduce spending that is considered not urgent, such as official travel, ceremonial activities, and other non-priority programs so that fiscal capacity can be strengthened.

Tito emphasized that the local government needed to first carry out efficiency and budget arrangements before applying for additional support from the central government.

According to him, this step is important to maintain the fiscal health of the region while ensuring that the obligation to pay the PPPK salary is still met without sacrificing development programs and public services.

With a healthier fiscal arrangement, the government hopes that the regions will have a larger budget space to finance development while meeting the needs of employee spending on an ongoing basis.