Minister of Finance Sri Mulyani Indrawati said that her party plans to provide fiscal incentives for local governments (Pemda) that have succeeded in keeping Regional Drinking Water Companies (PDAM) healthy.
"I actually also ask, in this case the Fiscal Policy Agency (BKF), to introduce the PDAM health indicator as an indicator to provide incentives, namely fiscal incentives," Sri Mulyani said in the 10th World Water Forum 2024 panel session in Badung, Bali, quoted from Antara, Tuesday, May 21.
The fiscal incentive is intended as a motivation for local governments to be able to overcome access to clean water problems, by keeping PDAM healthy. The Minister of Finance assessed that access to clean water has a strong correlation with PDAM's health.
He explained that later, the rewards of fiscal incentives can be used to reduce poverty, increase investment and regional growth, and can even be used to manage inflation.
We provide local governments that perform well when their inflation is below the national level. When their economic growth is above the national level. Where the reduction in the poverty rate is faster than the national level," he said. To realize it, the Treasury requested the approval of the Minister of Public Works and Public Housing (PUPR) Basuki Hadimuljono to set a health indicator for PDAM.
In addition, the Ministry of Finance will continue to use fiscal tools to continue to encourage investment for clean water and sanitation financing.
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"We use our fiscal tool so that we can continue to provide the right signal to the Regional Government and the private sector to invest in clean water. We want to encourage all parties, stakeholders to work together," he concluded.
As for the United Nations (UN) report, currently, 4 million people live in water crisis areas. 1 in 4 cities faces water vulnerability.
Through a number of cooperation and policies, including large investment and financing. Water infrastructure alone is estimated to require funds of 6.7 trillion US dollars by 2030.
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