Prices Of Fuel Rising, Local Governments Must Budget Perlinsos Mandatory Expenditure Expenditure Budget Until December 2022: To Anticipate Inflation Improvement

Director General of Fiscal Balance at the Ministry of Finance Astera Primanto Bhakti. (Photo: Doc. Antara)

JAKARTA - The Ministry of Finance (Kemenkeu) stated that the mandatory expenditure of local governments (Pemda) through a budget of two percent of the General Transfer Fund (DTU) outside the Revenue Sharing Fund (DBH) during October to December 2022 is an effort to control the impact of inflation due to rising fuel prices.

"The local government has contributed to providing support in the form of budgeting for mandatory social protection spending for the period October to December 2022," said Director General of Fiscal Balance at the Ministry of Finance Astera Primanto Bhakti, quoted by Antara, Thursday, September 8.

The assignment of the regional government to spend must be carried out in line with the government's decision to increase fuel prices that have implications for the national economy, namely increasing inflation so that it has an impact on people's purchasing power.

The handling of the impact of inflation this time is supported by the regional government with the budgeting for social protection spending in the Regional Revenue and Expenditure Budget (APBD) for Fiscal Year 2022.

Primanto said that local governments were given the authority to make programs that were adjusted to the conditions of their respective regions so that the impact of inflation was not felt directly by the community.

This is in line with President Joko Widodo's (Jokowi) directive when announcing the subsidized increase in fuel that state money must be prioritized to protect the underprivileged.

The implementation of this policy is realized by the issuance of Minister of Finance Regulation Number 134/PMK.07/2022 so that local governments contribute to providing their support.

The mandatory expenditure is used for job creation, the provision of subsidies for the public transportation transportation sector in the regions, as well as the provision of social assistance, including to motorcycle taxis, MSMEs, and fishermen.

The amount of DTU calculated is the distribution of DAU in October-December 2022 and distribution of DBH in the fourth quarter of the 2022 Fiscal Year.

Mandatory social protection spending does not include mandatory 25 percent expenditure from the DTU which has been budgeted for the 2022 Fiscal Year APBD.

Budgeting of mandatory social protection spending is carried out by changing the Regional Head Regulation regarding the elaboration of the APBD for Fiscal Year 2022.

For further changes, it is stated in Regional Regulation regarding changes to the Regional Budget for Fiscal Year 2022 or Budget Realization Reports for regions that do not make changes or have made changes.