Indonesia President 'Declares War' on the Loss of State Funds

Jakarta Globe, Arientha Primanita & Rizky Amelia, October 10, 2011

President Susilo Bambang Yudhoyono, third right, and Ibu Ani, third left,
attending the wedding of the son of politician Amien Rais, far right, in Jakarta
 over the weekend. In the wake of a damning report from the Supreme
 Audit Agency that says the state is losing trillions of rupiah in unnecessary
 expenses, Yudhoyono has vowed to put a stop to excessive spending at ministries,
regional governments and state-owned enterprises. (Antara Photo)

  

Related articles

• Editorial: Start Putting Public Funds to Good Use 9:19am Oct 10, 2011
• Indonesia Pledges to Raise Defense Spending 10:31am Oct 6, 2011
• Indonesia President Vows to Protect Forests 11:48pm Sep 27, 2011
• News Release: SBY Vows to Protect Indonesia’s Rainforests 1:30pm Sep 27, 2011
• The Thinker: SBY at a Crossroads 9:21am Sep 27, 2011

In the wake of a damning report from the Supreme Audit Agency that says the state is losing trillions of rupiah in unnecessary expenses, President Susilo Bambang Yudhoyono has vowed to put a stop to excessive spending at ministries, regional governments and state-owned enterprises.

“The party is over,” presidential advisor Daniel Sparingga said. “SBY is declaring war on the loss of state funds.”

In a recent meeting, the president instructed his staff to formulate a plan for more effective and efficient spending, Daniel said.

“It won’t be easy, but the president has made his decision. It is a daunting challenge, but people’s expectations are far too great to ignore,” he said. “All institutions will be asked to make the changes immediately.”

Last week, the audit agency, also known as the BPK, told a hearing committee at the House of Representatives that it had discovered potential state losses of Rp 26.68 trillion ($3 billion) in audits for the first half of the year.

During its biannual audit program, the agency found 11,430 cases of irregularities, including 3,463 in which the BPK deemed regulations had been violated, which amounted to potential losses of Rp 7.71 trillion.

The remainder of the cases did not violate any regulation but were deemed to be examples of ineffective or inefficient spending. They amounted to Rp 18.96 trillion.

Analysts have also criticized the government for spending too much on the operational costs of public buildings and individual salaries, preventing the funds from being invested into improving infrastructure.

House Speaker Marzuki Alie called for a bigger role for the State Development Finance Comptroller (BPKP), which he said was acting as the government’s financial consultant.

“The role of the BPKP must be returned to its original function as the government’s internal financial supervisor,” said Marzuki, a member of the Democratic Party.

“The revitalization of the BPKP is vital for the prevention of corruption. If [corruption] prevention increases, then the need for enforcement will diminish.”

Corruption Eradication Commission (KPK) deputy chairman Bibit Samad Riyanto said inspectorate generals at various ministries must be given wider independence and more authority to conduct more effective supervision into state spending.

The president, however, supports increased external oversight from civil society groups, Sparingga said.

“We openly invite people to take an active role in influencing all government institutions and officials from the central to regional levels. It is time for change,” he said.

“The president will ensure that all public officials’ power and authority will only be used for the good of the people.”

The BPK examined the financial records of 208 agencies fromlast semester — 61 in the central government and 92 from regional administrations.

The BPK generated a total of 191,757 recommendations for agencies under scrutiny.

“There will be monitoring to see that the recommendations are carried out and the state losses compensated, as well as further scrutiny,” BPK chairman Hadi Purnomo said.

Since 2003, the BPK has found 305 cases of possible criminal violations, leading to state losses amounting to Rp 33.63 trillion.

Some 166 cases have since been taken over by the National Police, the Attorney General’s Office and the KPK.