Jakarta \u2014 Finance Minister Purbaya Yudhi Sadewa expressed puzzlement\nat local governments\u2019 continued slow spending despite the government\u2019s\ndecision to increase the regional transfer allocation (TKD) in the 2026\nbudget.<\/p>\n
The TKD allocation in the 2026 state budget was initially planned at\nRp 650 trillion but increased to Rp 693 trillion following the passage\nof the 2026 budget law.<\/p>\n
\u201cThe funding has increased significantly, so it shouldn\u2019t be slow.\nWe\u2019re even transferring twice as much to the regions compared to last\nyear,\u201d Purbaya said at his Jakarta office on Friday, 13 March 2026.<\/p>\n
Consequently, he plans to conduct direct inspections of local\ngovernment spending performance. Purbaya suspects that local governments\nmay be deliberately slowing their spending to find additional funding\nelsewhere.<\/p>\n
\u201cI will check again. But they have the money. So they must be looking\nfor other sources,\u201d Purbaya stated firmly.<\/p>\n
The sluggish local government spending was revealed in the budget\nperformance realisation figures for February 2026 presented by the\nDirector General of Financial Balance, Askolani.<\/p>\n
The decline in local government spending was driven by slowdowns in\ngoods spending, capital expenditure, and other spending categories. In\ncontrast, employee spending actually increased 0.6 per cent compared to\nthe same period last year.<\/p>\n
\u201cThe preliminary figures show that realisation reached Rp 68\ntrillion, which is down 18 per cent compared to the same month in 2025,\u201d\nAskolani said.<\/p>\n
Meanwhile, on the revenue side, local government financial\nperformance data reported by 514 regional governments out of Indonesia\u2019s\ntotal of 546 actually showed improvement.<\/p>\n
\u201cFrom the 541 local governments that reported, regional budget\nrevenue realisation reached Rp 178 trillion, which is up 1.5 per cent\nfrom 2025,\u201d he stated.<\/p>\n
Askolani noted that the improved regional revenue performance was\ndriven by higher realisation of TKD disbursements from the central\ngovernment compared to last year, whilst locally generated revenue (PAD)\nremained minimal.<\/p>\n
\u201cThe revenue increase was primarily driven by higher TKD realisation,\nwith February 2026 TKD realisation 8 per cent higher than 2025.\nMeanwhile, PAD growth remained relatively small,\u201d Askolani said.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/finance-minister-puzzled-by-slow-local-government-spending-despite-increased-regional-transfer-budget-1773391954", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }