by: Agung Ariwibowo (public relations, information services, and protocol division)
After the political and economic crisis that hit Indonesia in 1998, fundamental changes occurred in various aspects of national life, including governance. These changes then gave birth to a new era in the bureaucratic system in Indonesia in strengthening the implementation of regional autonomy and decentralization, including in the implementation of fiscal in the regions. Decentralization has implications for the pattern of relations between the central and regional governments by taking into account the uniqueness and diversity in each region.
The regulations on Central-Regional Financial Relations have been regulated and implemented fairly and in harmony based on Law Number 33 of 2004 on the Financial Balance between the Central Government and Regional Governments.
The fiscal decentralization policy that has been going on for almost two decades has also influenced the policy of allocating Transfer to Regions (TKD) in the State Revenue and Expenditure Budget (APBN). One of the influences can be seen from the trend of allocations that continue to increase every year. This policy is indeed quite impactful, as evidenced by relatively high economic growth in some regions. However, unfortunately, this has not been followed by significant improvement and improvement in the welfare of the community as mandated by law.
Therefore, the government considers it necessary to improve the laws that regulate the Central-Regional Financial Relations. Against this background, the government through the Ministry of Finance together with the DPR RI changed and replaced Law Number 33 of 2004 on the Financial Balance between the Central Government and Regional Governments and Law Number 28 of 2009 on Local Taxes and Levies with the Law on Central-Regional Financial Relations (HKPD) which was newly enacted on December 7, 2021.
The purpose of the HKPD is to realize the efficient and effective allocation of national resources through HKPD that is transparent, accountable, and equitable for the equitable welfare of the community throughout Indonesia. At a press conference after the Plenary Session of the HKPD RUU Ratification, the Minister of Finance explained that the HKPD is based on 4 main pillars that will strengthen the implementation of fiscal decentralization. The first pillar is to develop Central-Regional Financial Relations in reducing vertical inequality (between the central government and local governments, both provinces and regencies/cities) and horizontal inequality (between local governments at the same level). The second pillar is to develop a local tax system that supports the efficient allocation of national resources. The third pillar is to encourage the improvement of the quality of local spending, and the fourth pillar is to harmonize fiscal policies between the Central Government and Local Governments for the optimal provision of public services and to maintain fiscal sustainability.
Written by: Agung Ariwibowo (public relations, information services, and protocol division)
The pandemic has been going on for almost two years, but its effects are still felt in various regions, including South Sumatra. The central and regional governments continue to launch various programs to overcome the impact. Social protection is one of the concentration of PEN fund allocation, among others through the distribution of Direct Cash Assistance (BLT) from Village Fund. BLT as part of social protection is expected to reduce the impact of the pandemic felt by the community. To be utilized well, continuous steps are taken to optimize the distribution of Village Fund and BLT Village with high accountability.
The low understanding of Village Fund management has led to vulnerabilities in the management of APBDes, especially the budget sourced from Village Fund. The potential for deviations that occur is still relatively high. Even the stigma that Village Fund is the Head of Village Fund has occurred, so it has an impact on the lack of accountability in Village Fund management. Various legal cases related to Village Fund management have been revealed by law enforcement or reported by the public.
There are several conditions that are indicated uncompliance, such as village funds that have been distributed but there is no physical construction or the condition of the community has not received / has only received a portion of the Village BLT. In addition to the potential for corruption in disaster management budgets, the general problem that is often faced is the lack of public information catalysis so that in emergency disaster situations, government policies actually face serious challenges.
Some facts have also been found related to the problems experienced by people in remote villages in South Sumatra such as the poor quality of infrastructure, especially village roads, the lack of quantity and quality of education and health facilities, the high level of unemployment and poverty in villages, the quality of clean water and sanitation that is not yet adequate, as well as limited access to village communities and micro-business actors in villages to business capital assistance. This is ironic because the distribution of Village Fund has been going on since 2016.
The identification of the causes of the above problems include the lack of literature related to good and accountable village financial management owned by village officials, including in it is the wrong perception about the allocation of Village Fund. The main purpose of the Village Fund is for the interests of the Village, not for the interests of the village officials. This contributes to the low commitment of village officials. The weakness of Village Fund governance can be seen from the suboptimal planning and the non-understanding of the process of implementing work funded by the Village Fund, so it has an impact on village officials who cannot account for the use of Village Fund. Another thing that is also no less important is the lack of knowledge of village officials in using the Village Financial System (Siskeudes) application.
The Village Fund ceiling in South Sumatra increases every year. Starting in 2016, the number of Village Fund ceilings received was Rp1.78 trillion to Rp2.69 trillion, or increased by Rp911 billion since 2016. From the large amount of village fund nominal, it apparently has not been able to provide a real impact on the welfare of the people of South Sumatra which is marked by being included in the 10 provinces with the highest number of poor people in 2020 according to BPS.
Kanwil DJPb Provinsi Sumatera Selatan, in carrying out its role as Regional Chief Economist, needs to be supported by various new breakthrough efforts. Therefore, in 2021, Kanwil DJPb Provinsi Sumatera Selatan implemented an education pattern with knowledge sharing of village financial management and village rating survey for sub-district heads in each regency and Open Class themed "Guarding Village Fund Accountability in the Covid-19 Pandemic Era" for village officials. The goals expected from this activity are to increase understanding of village financial management, support the realization of good governance in village financial management, accelerate the distribution of Village Fund, and increase understanding of Village Fund Accountability in the Covid-19 Pandemic Era. Strengthening this literature will certainly accelerate development in the village while also building a positive public perspective or education about the importance of maintaining transparency and accountability so that the APBN can be utilized optimally.
Knowledge sharing is intended for sub-district heads, because sub-district heads are the ones who will carry out government and financial supervision for each village in their area. The sub-district head is an official who certainly understands the characteristics of the villages in their area and must also be the most understanding about village financial governance in order to be able to encourage villages in their binaan area to become villages that meet the characteristics of good governance.
Komitmen pemberantasan korupsi tidak boleh berhenti pada hal-hal yang bersifat seremonial ataupun administratif. Hal ini dinyatakan oleh Wakil Presiden Ma’ruf Amin dalam kegiatan Apresiasi dan Penganugerahan Zona Integritas Menuju Wilayah Bebas Korupsi (WBK) dan Wilayah Birokrasi Bersih Melayani (WBBM) Tahun 2021 yang diselenggarakan pada hari Senin (20/12).
Author: Agung Ariwibowo (division of protocol, information services, and public relations)
Since the Korean drama Start-Up won over hearts throughout the globe in 2020, young people all over the world—including Indonesia—have become interested in the way it portrays digital entrepreneurs. The drama struck a deep chord with viewers by emphasizing micro, small, and medium-sized enterprises (MSMEs) and encouraging them to think about starting their own businesses. This interest aligns with the practical necessity for innovation during the pandemic, particularly for companies that are finding it difficult to adjust.
Start-Up: A Reflection of Reality in Indonesia
Surprisingly, the movie provides a realistic portrayal of current Indonesian endeavors, such as the National Movement of 1000 Digital Start-Ups. Similar to what is shown in the drama, the Ministry of Communication and Information Technology launched this initiative in 2016 and offers possibilities for investor pitching, incubation, and training. But compared to its fictitious equivalent, this cleverly built program is not as well-known.
The Funding Dilemma and the Promise of Crowdfunding
Even with the proliferation of entrepreneurs and ideas, one of the biggest obstacles is still getting money. Lack of funding causes many promising projects to fail, and this problem affects all areas and kinds of businesses in Indonesia, not only those included in government programs. This issue affects MSMEs generally as well as digital start-ups, as the latter are vital to the GDP of the country and its ability to withstand financial downturns.
Although the government has offered financial assistance and credit in addition to other forms of support during the epidemic, not all MSMEs actors have benefited equally from these initiatives. Herein lies the potential of crowdfunding, an approach that was first introduced in the United States in 2003. Korea embraced this idea in 2016, making it possible for traditional MSMEs and digital start-ups to obtain capital from regular investors via specialized platforms.
Indonesia's Crowdfunding Adventure: From Laws to Implementation
Thankfully, crowdsourcing has gained traction in Indonesia. Regulations such as OJK Regulation No. 37/POJK.04/2018 have made equity crowdfunding platforms like bizhare.id and santara.co.id possible since 2018. With the introduction of securities crowdsourcing more recently, OJK Regulation No. 57/POJK.04/2020—amended by OJK Regulation No. 16/POJK/04/2021—addressed the shortcomings of the previous equity crowdfunding model. A greater variety of securities (bonds, shares, sukuk) and issuers (any corporate entity, even non-legal) are permitted under this extended version.
Presently, LandX, Bizhare, Crowddana, Danasaham, and Santara are the five fintech businesses that are licensed to conduct crowdsourcing investments in Indonesia. MSMEs nationwide will be empowered as the process of obtaining funding becomes more democratic and accessible as the number of suppliers increases.
Democratizing Investment and Strengthening MSMEs: The Path Ahead
A clear way forward is provided by the lessons learned from Start-Up and the promise of crowdfunding: enabling MSMEs by giving them more access to cash. Indonesia can foster an inclusive and resilient economy and unleash the entrepreneurial spirit of its people by introducing and promoting effective crowdfunding platforms. For many Indonesian MSMEs, the drama's vision of democratically driven corporate growth is achievable with the correct collaborations and structure.