Change Approach to Central and Regional Financial Balance


JAKARTA, KOMPAS. The trend of decreasing the ratio of transfers to regions was caught by a number of mayors as a form of distrust of the central government to local governments. In fact, the problem of regions not being able to spend their budgets should be overcome by building a system so that the budget is used effectively and accelerates regional development.


For 2023, the government prepares a budget for transfers to regions and village funds (TKDD) ranging from Rp. 800.2 trillion to Rp. 832.4 trillion or 38-40.1 percent of the central government’s budget of Rp. 1,995.7 trillion-Rp. 2,161.1. trillion. The ratio is not much different from this year, which is Rp 770.4 trillion or 39.75 percent of total government spending. However, in the period 2017-2021, referring to data from the Institute for Development of Economics and Finance, the trend of the ratio of TKDD to central spending continues to decline. In 2017, the ratio reached 58.64 percent.


Specifically for 98 city governments in 2021, the TKDD allocation will reach Rp. 105.663 trillion out of a total TKDD of Rp. 770.3 trillion. The TKDD includes, among others, general allocation funds (DAU), special allocation funds (DAK), village funds, and profit-sharing funds.


In the discussion of the Kompas Collaboration Forum-City Leaders Community entitled “Strengthening Regional Transfer Budget Politics for City Development” which was held by Kompas daily in collaboration with the Association of Indonesian City Governments (Apeksi), Friday (10/6/2022), the Chairman of Apeksi who is also the Guardian In the city of Bogor, West Java, Bima Arya said that one example of TKDD that no longer exists is the village fund.