Govt should keep aid for Aceh, not for state budget: Analyst
Govt should keep aid for Aceh, not for state budget: Analyst
Urip Hudiono, The Jakarta Post, Jakarta
The government must prioritize the use of grants and debt relief
from donor countries for the rebuilding of tsunami-stricken Aceh
and North Sumatra provinces, instead of using them to help
bolster the state budget.
To ensure this, economist Faisal Basri reiterated a recent
call from non-governmental organizations that the government
immediately set up an independent body to monitor the management
of aid funds.
"The government should not take advantage of the disaster in
Aceh for the benefit of the state budget," he told The Jakarta
Post on Sunday.
Faisal also warned the government not to be lax in maintaining
the 2005 state budget at a balance -- such as by slackening its
tax revenue target through tax amnesties -- just because it would
receive fiscal incentives from the aid pouring into Aceh.
Calling it "inappropriate", he said such a scenario was
possible as the government could gain more from the monetary aid
for Aceh than for its expenditure.
"The debt relief offers themselves can be greater than the
cost of rebuilding Aceh," he said.
At last week's international tsunami summit, donor countries
pledged a total of US$4 billion for relief and reconstruction for
the affected countries. The detailed scheme on the debt relief
will be discussed further at the Paris Club meeting on Jan. 12.
The debt relief would help reduce the allocation of some US$3
billion in the country's state budget for foreign debt payments.
Vice President Jusuf Kalla recently said the government would
seek debt relief of up to Rp 30 trillion (about US$3.33 billion)
from creditor countries.
Meanwhile, the finance ministry's Director General for State
Treasury Mulia Nasution said the estimated cost to rebuild Aceh
stood at Rp 20 trillion.
Mulia also said that the 2005 state budget spending for Aceh
and North Sumatra would be less than Rp 100 billion from the
government's original allocation of Rp 300 billion. The reduced
amount was due to the monetary donations from the public and from
foreign countries.
"It should not be like that," Faisal said. "Any financial
reserves, which have been designated for Aceh, should still be
used for the rehabilitation of the province."
Faisal, who is also the national coordinator of the
Humanitarian Emergency Commission for Aceh, cited the urgency of
establishing an independent body tasked to transparently maintain
a record of donations for Aceh and their disbursement, as well as
to ensure that the funds reach the targeted recipients.
"Such a body is needed because the public still doubts the
government's credibility, as it is still plagued with corruption"
he said. "Therefore, the independent body should be led by
someone who is publicly accepted as clean."
Faisal explained that the body should comprise of
representatives from selected institutions and have the full
authority to assess the flow of the funds.
He pointed to the urgency of the body following statements
from finance ministry officials saying that none of the pledged
aid from donor countries for Aceh had actually gone to state
coffers.
"But how can the public verify that, if there is no
transparent access to the funds?" he said.