Jokowi Issues Presidential Regulation On Funding For Infrastructure Provision, Here Are The Details

President Jokowi (Photo: Antara)

JAKARTA - President Joko Widodo (Jokowi) issued Presidential Regulation (Perpres) Number 79 of 2024 concerning Funding for Infrastructure Provision through Management of Regional Value Improvement.

In this regulation, Jokowi formed an alternative funding in the form of Regional Value Improvement Management or (P3NK).

"The Management of Regional Value Improvement, which is then abbreviated as P3NK, is an alternative funding for the provision of regional-based infrastructure and/or within the zoning radius/corridor that allows the provision of infrastructure to be funded by the proportion of value increase due to the impact of the value creation initiative carried out by the central government, local governments and/or business entities obtained from beneficiaries as well as the results of regional development," the regulation said, quoted on Tuesday, August 20.

The formation of P3NK aims to create a cycle of value for benefits in connection with the provision of infrastructure consisting of value creation, value capture and value funding.

The target of the formation of P3NK is the first to realize sustainable development by based on a spatial planning document that is able to grow new economic nodes along the zone that intersects with the provision of infrastructure.

Second, P3NK is expected to increase the quantity, quality and efficiency of infrastructure services so that it has an impact on creating an increase in value. Third, the creation of new funding sources to fund a sustainable infrastructure provision.

Fourth, encourage the creation of an attractive, conducive investment climate and guarantee legal certainty by taking into account the level of fairness in returning investments. Fifth, encourage public participation in funding infrastructure provision through various predetermined principles.

Finally, the push for awareness and initiative from local governments with the potential for infrastructure provision through P3NK to provide infrastructure independently.

Later, the implementation of P3NK will be carried out by district or city governments for each P3NK within the relevant district/city administration area and will be carried out by the DKI Jakarta Provincial Government in connection with P3NK which is located in the Jakarta administration area.

Thus, regional heads will later be given a number of powers in the implementation of P3NK. Some of them are allowed to approve the P3NK feasibility study, determine the P3NK manager, determine the source of P3NK funds and delineate the catch area.

Then, determine operational funds and operational funding sources for P3NK managers, regulate P3NK institutions and governance and approve the distribution of funding support for infrastructure provision whose funds are sourced from P3NK funds.

In addition, regional heads will also be given the authority to approve the provision of incentives and disincentives in relation to the implementation of P3NK, receive regular reports, facilitate every public consultation, facilitate coordination with a number of stakeholders and finally facilitate the resolution of strategic problems related to the implementation of P3NK.