Disaster Reserve Funds Only Available IDR 10 Trillion Of Needs IDR 20 Trillion Per Year, Government Will Use Pooling Fund In Cianjur?

Illustration (Photo: Doc. Antara)

JAKARTA - The government through the Ministry of Finance (Kemenkeu) is recorded to only allocate around IDR 5 trillion to a maximum of IDR 10 trillion per year as disaster reserve funds in the APBN to fund emergency response, rehabilitation and reconstruction grants to local governments.

In fact, a study by the Ministry of Finance in 2020 revealed that the average value of direct damage caused by disasters in the last 15 years reached around IDR 20 trillion per year. This is VOI's records based on data released by the ministry led by Sri Mulyani some time ago.

In an effort to close the budget needs gap, the government then implemented a kind of value protection scheme on a number of strategic assets and facilities.

Head of the Fiscal Policy Agency (BKF) of the Ministry of Finance, Febrio Kacaribu, said that this innovative funding was in the form of joint funds or Disaster Fund Pooling (PFB), through the issuance of Presidential Regulation Number 75 of 2021 concerning Disaster Management Joint Funds on August 13, 2021.

According to him, PFB is the government's effort to realize a commitment to strengthening fiscal resilience in tackling the impact of natural and non-natural disasters.

PFB is here to close the funding gap and speed up the disaster management process. Currently, PFB will have initial managed funds of approximately IDR 7.3 trillion," he said.

Meanwhile, PFB is managed autonomously by a Public Service Agency (BLU) at the Ministry of Finance. Through the working principle of BLU, PFB not only mobilizes funds, but also invests and accumulates the funds raised.

"As part of the disaster risk funding and insurance strategy, PFB allows the government to regulate disaster risk funding strategies through the APBN/APBD, as well as move the risk to third parties through insurance of government and public assets," he explained.

"In the next 2-3 years, PFB will fund the purchase of insurance premiums for all buildings/building belonging to ministries and institutions and work together to co-financing with local governments to insurance regional assets. Thus, the value of damage caused by natural disasters borne by the government can be suppressed," said Febrio.

As is known, on Monday, November 21, an earthquake with a magnitude of 5.6 occurred in the southwest region of Cianjur Regency, West Java.

The disaster resulted in heavy damage to house materials as many as 60,570 units, lightly damaged 2,071 units, lightly damaged 12,641 units and a number of others that have not been collected.