Minister of Finance (Menkeu) Sri Mulyani said that disaster management funds managed through the current pooling fund mechanism are already IDR 7.3 trillion.
According to him, this amount was collected in stages with details of IDR 3 trillion from the State Budget for Fiscal Year 2022 and IDR 4.3 trillion in the State Budget for Fiscal Year 2023.
"We will continue to collect this and if it is not used, the funds will be maintained. The pooling fund concept is exactly like education endowment funds (Education Fund Management Institutions/LPDP)," he said in an official statement quoted on Friday, March 3.
The Minister of Finance explained that the latest scheme implemented will further accelerate disaster management responses and open wider space for the ability to provide funds.
"The fund management is carried out by the Environmental Fund Management Agency (BPDLH)," he said.
The state treasurer revealed that in the first phase, pooling fund funds were used to insure buildings and state assets in the central and regional levels as a step of readiness in the event of a natural disaster.
The government has also prepared contingency funds in the form of loans that can be disbursed in the event of a disaster, namely those from the Asian Development Bank (ADB) amounting to 500 million dollars.
"ADB funds can be used to anticipate certain events, both in the context of handling COVID-19 and disaster management in the future," he said.
The Minister of Finance added that to minimize the risk, the government has implemented risk transfers through State Property Insurance (BMN) and agricultural insurance.
"When farmers start harvesting and flooding, they will get replacements if the farmer community has insured plants, goods, which are indeed part of their income," he said.
The Minister of Finance hopes that all of these mechanisms will be one of the factors that support the successful response immediately when disasters occur in various regions. He also specifically emphasized the importance of central and regional coordination.
"So that later this will become a strong ecosystem," closed the Minister of Finance Sri Mulyani.
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