Corruption-prone nonbudgetary funds still exist: BPK
Rendi A. Witular, The Jakarta Post, Jakarta
Chairman of the Supreme Audit Agency (BPK) Satrio B. Judono has expressed concern that the old, bad habit of government ministries and state agencies collecting nonbudgetary funds remains widespread.
He said there were indications that some of the institutions were reluctant to transfer funds to state coffers via the Ministry of Finance account, as required by existing regulations.
"The government has not taken any steps to uphold the existing regulations (on nonbudgetary funds).... We presume there are still many off-balance-sheet funds managed by the institutions," he told the media on Friday.
Judono, however, refused to give figures or mention the state institutions involved.
Nonbudgetary or off-balance-sheet funds are basically nontax revenues collected by state institutions but not included in the state budget. In the past, these huge funds were a source of corruption and were allegedly used to finance the 32-year authoritarian rule of former president Soeharto.
In a bid to curb corruption as well as to implement good governance and transparency in state institutions, the government decided to eliminate nonbudgetary funds and transfer them to a state revenue account subject to public audit.
Two presidential instructions (Nos. 9/1999 and 4/2000) and a Ministry of Finance decree were issued to prohibit state institutions from managing their own budget drawn from nontax revenues.
The government had set a deadline of July 2000 for the institutions to transfer the funds. However, of 58 ministries and state agencies, only 24 had reported their nonbudgetary accounts, 21 declared they did not maintain such accounts and 13 institutions had not yet reported by the deadline. Some analysts have even suspected that many institutions did not reveal the genuine level of funds, although BPKP (the internal audit agency) was called in to verify their reports.
At the time of the deadline, the government managed to net more than Rp 11 trillion (US$1.3 billion) in nonbudgetary funds, the bulk of which came from reforestation funds, which totaled Rp 7.5 trillion. This figure was much higher than the Rp 4.1 trillion initially reported by the Ministry of Forestry at the time, and there have been accusations that the actual amount of the funds was much higher.
Many institutions have refused to transfer their nonbudgetary funds (or some only transferred part of them) because there are no definite sanctions stipulated if they violate the ruling.
Judono said that in order to prevent any misuse of nonbudgetary funds and to uphold accountability, BPK was now giving consideration to auditing foundations or other legal entities linked with the institutions, including the newly established Vice President Center and several universities.
The Vice President Center is a non-governmental organization set up by Vice President Hamzah Haz aimed at providing an alternative forum for communication between the government, the public and the private sector in dealing with problems facing the nation. During its launch in August the center managed to collect Rp 325 million ($38,700).
State universities are also targeted in the audit because they often receive foreign funds for research projects or education infrastructure. Such funds are not subject to public audit.