Without The Right Reallocation, Efficiency Will In Fact Hamper Economic Growth

Rupiah (Photo: Antara)

JAKARTA - The government is considered to have to ensure budget efficiency so that it is allocated to more productive programs.

Because, according to UPN Jakarta Public Policy Expert Achmad Nur Hidayat, without a proper reallocation, this efficiency actually hampers economic growth and reduces the quality of public services.

"For example, if efficiency is only used to finance populist programs such as Free Nutrition Food (MBG) or the construction of three million houses without careful calculations, this policy can be counter-productive," said Achmad quoting Antara.

According to him, the middle and lower class need more than direct assistance. The community needs price stability, job availability, and flexible access to capital.

Meanwhile, through a letter numbered S-37/MK.02/2025 quoted in Jakarta, Tuesday, Finance Minister Sri Mulyani stated that the letter was a follow-up to the Presidential Instruction of the Republic of Indonesia Number 1 of 2025. In the letter, the government determined budget efficiency of IDR 256.1 trillion.

In order to accommodate these directives, Sri Mulyani has set 16 shopping posts that need to be cut in budget with varying percentages, ranging from 10 percent to 90 percent.

Responding to this, Achmad revealed that the inefficiency of state spending occurred due to weak budget planning, complicated bureaucracy, and corruption and budget abuse.

Programs that are not based on study often lead to redundant spending. He also highlighted that large amounts of budget cuts pose a risk of reducing the quality of public services and hampering the performance of ministries/agencies (K/L).

If not accompanied by a clear strategy, he continued, shrinking state spending could actually slow economic growth.

Furthermore, Achmad recommended five main steps so that budget efficiency is not just a cut in numbers.

First, the need for an evaluation of shopping posts. K/L needs to conduct an internal audit to identify expenses that can really be reduced without hampering performance.

Second, performance-based budgeting. Every expenditure must be oriented towards concrete results, not just formality.

Third, digitization and bureaucratic reform. The use of technology can reduce administrative costs and increase transparency.

Fourth, strict supervision by the Supreme Audit Agency (BPK) and the Ministry of Finance. The government needs to ensure that budget efficiency does not harm public services.

Fifth, the realization of efficiency funds to productive programs. The funds saved must be allocated to create jobs, support labor-intensive industries, and reduce capital costs for MSMEs.

"The government must ensure that this efficiency is not only a means of saving, but also a step towards more transparent and effective budget reform. If the proceeds from efficiency are used for programs that are truly beneficial to the people, then this policy will receive broad support from the public," he said.