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Indonesia: Government Cancels Plans to Double Village Fund in 2018
Source: http://www.thejakartapost.com
Source Date: Wednesday, December 13, 2017
Focus: Institution and HR Management
Country: Indonesia
Created: Dec 15, 2017

Villagers travel along the newly repaired road in Minahasa Baji village, South Sulawesi. on Nov. 29. The road repairs were financed with the village fund.

The government has canceled next year's plan to double the budgetary allocation for the village fund program from Rp 60 trillion to Rp 120 trillion (US$8.4 billion), a Finance Ministry official has said on Tuesday in Bogor, West Java.

President Joko “Jokowi” Widodo had earlier promised to double the village fund allocation to improve welfare of people in remote areas.

The ministry's director general of fiscal balance, Boediarso Teguh Widodo, said the government had decided not to disburse additional funds to villages after evaluating this year's use of the village fund program.

Alleged corruption hampers use of village funds

Boediarso explained that the government had evaluated the program on four indicators of success: eradicating poverty, creating jobs, increasing the people's incomes and purchasing power, and reducing the economic disparity among villages.

Boediarso said this year's use of the village fund program had managed to achieve part of the objective, but the program's impact on poverty eradication had not met the target. “This means that its multiplier effect has not been optimal,” he said as reported by tempo.co.

Instead, the government wanted to improve the capacity of village officials in managing the fund toward improving the people's welfare, and to prevent the officials from becoming involved in corruption.

He said the government planned to double the village fund in 2019, with targeted disbursements of about Rp 1.4 billion for each village. 

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