IHPS II 2025 Released, BPK Reveals Findings on Local Governments and Regional-Owned Enterprises

The Supreme Audit Agency (BPK) has disclosed the results of its examinations of local governments (pemda) concerning food security, human development (PM), regional banking, and the management of Local Taxes and Retributions (PDRD) to the Regional Representative Council (DPD). The audit results are contained in the Semester II 2025 Audit Summary (IHPS), presented by BPK Deputy Chairman Budi Prijono to DPD leaders in Jakarta on Thursday (23/4/2026). “IHPS II 2025 contains a summary of audit results from 685 Audit Reports (LHP), comprising 7 financial LHPs, 237 performance LHPs, and 441 LHPs with specific objectives (DTT). Specifically for pemda and BUMD (Regional-Owned Enterprises), there are 520 LHPs, consisting of 2 financial LHPs, 185 performance LHPs, and 333 DTT LHPs,” said BPK Deputy Chairman Budi Prijono in an official statement. In the national thematic examination on food security, BPK recommends that governors coordinate with the National Food Agency (Bapanas) to facilitate and assist in preparing the Regional Food Plan (RPD). Additionally, governors are advised to coordinate with the Coordinating Minister for Food Affairs to facilitate and support the preparation of the Regional Food and Nutrition Action Plan (RAD-PG). “BPK also recommends that governors coordinate with the Minister of Home Affairs (Mendagri) and the Head of Bapanas to integrate food information systems and prepare accurate and timely regional food balance projections,” stated Budi Prijono. For the national thematic examination on human development, it conveys recommendations for regional heads to prepare adequate planning to provide buildings, infrastructure, and medical equipment at Primary Healthcare Facilities (FKTP) in accordance with standards and needs to support health services. The next recommendation is for regional heads to update data on students, educators and education personnel (PTK), as well as facilities and infrastructure periodically according to actual conditions based on complete and valid data. Regarding the portrait of regional banking, BPK identified several significant findings in 25 Regional Development Banks (BPD) and 2 Rural Credit Banks (BPR). BPK recommends that BPD directorates diversify efficient funding sources to avoid dependence on certain customers, then apply prudent principles in approving credit grants or credit restructurings, and take recovery and/or credit resolution steps in accordance with applicable provisions. IHPS II 2025 also includes significant audit results conducted on 89 pemda regarding PDRD management. BPK recommends that relevant regional heads establish regulations that are appropriate and aligned with Law No. 1 of 2022 on Financial Relations between the Central Government and Regional Governments, as well as Government Regulation No. 35 of 2023 on PDRD, in a complete and up-to-date manner. It also recommends that regional heads prepare and propose PDRD revenue budget targets supported by PDRD potential calculations and considering regional macroeconomic policies in accordance with provisions. Since 2005 until the first semester of 2025, BPK has submitted 785,257 recommendations to all audited entities. For pemda and BUMD, the recommendations given amount to 637,016 or 81.1 percent of the total recommendations, with a follow-up percentage in accordance with the recommendations of 80.9 percent. Pemda with high resolution rates include the Pati Regency Government (Pemkab) and Sukoharjo Regency Government (Pemkab), each at 99.7 percent, as well as Madiun Regency Government at 99.4 percent. “For this reason, we express appreciation for the high commitment from regional heads in accelerating the follow-up of BPK recommendations and place hopes on the DPD as a regional representation to optimise its supervisory role. This synergy is crucial to realise increasingly accountable financial management and sustainable improvements across all regions,” he stated.