Behind the Glitz of the 2010 Budget
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Even though they were confronted with such threats to their budget authority and declining amounts of money to spend as they wished, regional governments continued to give priority to
indirect routine expenditure. And most of that disappeared in meeting the needs of local bureaucracies. In the process direct development-related expenditure on the provision of public
services was sacrificed.
Regional governments’ critical shortage of fiscal discretion should not have been used, as it was by most, to explain away their failure to accelerate the pace of programs to meet fundamental
rights of poor people and on reducing poverty. On the contrary, they should have regarded such a situation as an opportunity to redouble their efforts to increase, over time, levels of own source
local revenue PAD. They could do that by increasing local taxes, fees and charges and by better managing local assets, without imposing undue new burdens on their communities. But, as of
2010, PAD accounted for only 8 on average across regions of local government revenue. That number shows that local governments are not reacting seriously or creatively to the fiscal
constraints they face.
d. Budget Mismanagement Costing the State Dearly
National Audit Board BPK reports released in the first semester of 2009 covering realized budgets for 2008 recorded that misappropriation of funds for the benefit of political elites in 104
regions resulted in losses to regional government budgets totaling more than Rp 112.5 billion Table 4. Recorded abuses included: inflated costs of official travel, housing allowances for local
legislative assembly DPRD members, payment of unearned honorariums to local government heads, inflated prices for fuel for official vehicles and multiple payments under several headings
in official travel votes.
As Table 4 shows, the abuses also cost the State purse a total of Rp 306.6 billion Table 4. That represented an unbelievable rise of 173 over the 2008 figure.
Graphic 3
Trends in Fiscal Space 2007-2010 Percentage
Nationial Provinces
KabupatensCities
Source: 2010 data from D-G of Fiscal Balance MoF
Percentage
Behind the Glitz of the 2010 Budget
-62- Table 4
Total Actual and Potential Fiscal Losses of ProvincesKabupatensCities by Province, 2009
No Province
Regional level losses Potential regional level losses
Number of
Cases Amount Involved
Rp Millions Number
of Cases Amount Involved
Rp Millions 1
Aceh 27
22 706.81 9
24 229.61 2
North Sumatera 90
20 013.73 7
11 028.25 3
West Sumatera 50
7 064.59 21
49 422.54 4
Riau 32
11 237.51 7
973 334.66 5
Jambi 33
10 455.37 13
16 333.93 6
South Sumatera 52
9 496.03 10
5 995.14 7
Bengkulu 40
8 920.45 1
782.34 8
Lampung 34
8 153.04 10
228 485.68 9
Bangka Belitung 26
2 365.40 9
1 479.18 10
Riau 37
17 547.66 7
33 937.41 11
Special District of Jakarta 31
7 632.35 1
- 12
West Java 27
2 542.80 1
- 13
Central Java 35
2 691.50 18
20 433.75 14
Special District of Yogyakarta 12
2 307.85 -
- 15
East Java 102
7 291.09 19
151 114.11 16
Banten 44
13 188.09 7
40 294.85 17
Bali 37
8 486.73 10
9 695.54 18
West Nusatenggara 23
1 280.40 5
3 549.33 18
East Nusatenggara 22
5 395.26 18
5 231.873 20
West Kalimantan 19
2 863.84 3
5 205.47 21
Central Kalimantan 94
18 581.26 15
7 049.41 22
South Kalimantan 32
5 426.16 13
22 963.56 23
East Kalimantan 19
9 117.01 4
460 500.38 24
Southeast Sulawesi 36
16 342.29 4
1 477.58 25
West Sulawesi 48
12 631.61 17
51 411.61 26
South Sulawesi 41
9 313.05 12
6 081.86
Behind the Glitz of the 2010 Budget
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27 Central Sulawesi
57 19 796.63
12 27 280.51
28 Gorontalo
36 5 695.31
5 30 338.84
29 North Sulawesi
43 8 817.80
6 23 885.38
30 Maluku
7 524.93
- -
31 Papua
39 12 982.21
11 8 971.13
32 West Papua
21 15 767.85
2 3562.90
TOTAL 1 246
306 637.34 277
2 254 145.97
Remarks: Data from the national Audit Board BPK, processed by Seknas FITRA
e. Yet More Wastage
