YOGYAKARTA Not long ago, the Mayor of Solo, Gibran Rakabuming Raka, left for the United Arab Emirates (UAE) to obtain grant funds from the local government. According to Gibran, grant funds from the UAE for the City Government are worth hundreds of billions of rupiah. So, how is the regulation of grants from abroad for local governments?
Regulation of grants from abroad for local governments (Pemda) is contained in Government Regulation (PP) Number 10 of 2022 concerning Procedures for Procurement of Loans and Grant Revenue.
In the PP, what is meant by foreign grants is any state revenue in the form of foreign exchange and/or foreign exchange which is converted, rupiah, or in the form of goods and/or services obtained from foreign grant providers that do not need to be paid back.
According to the PP, the acceptance of grants must meet the following principles:
- Transparency
- Accountable
- Efficient and effective
- prudence
- No political ties
- Does not have a charge that could disrupt the stability of state security.
In Article 7 of the PP, local governments can forward grant funds obtained from abroad to Regional Owned Enterprises (BUMD) in accordance with statutory regulations.
According to Article 42 of PP Number 10/2011, grants that can be received by the government are in the form of:
- Cash
- Money to finance activities
- Goods or services
- Securities
Grants received by the central or regional government in the form of cash must be deposited directly into the state's general treasury account or account that has been determined by the minister as part of the receipt of the APBN or APBD.
Furthermore, grants received by the central and regional governments in the form of money to finance activities must be included in the budget implementation document.
Meanwhile, the receipt of foreign grants by type consists of:
- Planned grants
- Direct grant
The planned grant is a grant that is implemented through a planning mechanism. Direct grants are grants that are implemented not through a planning mechanism.
In Article 50 of PP Number 10 of 2011, foreign grants can come from:
- Foreign countries
- Institutions under the United Nations (UN)
- Multilateral institutions
- Foreign financial institutions
- Foreign non-financial institutions
- National financial institutions that live and carry out business activities outside the territory of the Republic of Indonesia
- Individual
Grant funds obtained by the central government or local governments can be used for:
- Supports national development programs
- Supporting natural disaster management and humanitarian assistance.
Regarding the grants obtained by the Solo City Government from the UAE, the funds will be channeled to the Public Works and Spatial Planning Service (PUPR) for the purpose of building roads.
"At PUPR (PUPR Service of Public Works and Spatial Planning), most are for road construction, especially village roads. If possible, the village road will be completed (work)," said Solo Mayor Gibran Rakabuming Raka, visiting VOI, Thursday, December 29, 2022.
In addition, grant funds from the UAE will also be channeled through the Surakarta City Housing, Settlement and Land Office for the arrangement of uninhabitable houses, a total of thousands of units.
"In the health sector for medical equipment, medical devices to complete regional hospitals and health centers. In the education sector, information technology is procured for 27 junior high schools, around 100 elementary schools, and for learning infrastructure," he said.
In the business sector, grant funds are used for the development of traditional markets and MSME capital assistance.
"Dispora also completed the Manahan Sports Hall, because the facilities were expensive, such as the completeness of seats, IT, videotrons, which were expensive," he said.
This is information regarding foreign grant regulations for local governments. Grant funds can be used for national development programs and natural disaster management.
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