PU Ministry Faces Rp 19.35 Trillion Shortfall, New Infrastructure Projects on Hold
The Ministry of Public Works (PU) has confirmed it will be unable to start a number of new infrastructure projects in 2027. Due to limited indicative budget ceilings, the Directorate General of Human Settlements is prioritising the completion of multi-year contracts, community-based programmes, and post-disaster rehabilitation.
“The budget requirement for the Directorate General of Human Settlements is Rp 30.42 trillion. However, referring to the joint letter from the Minister of Finance and the Minister of National Development Planning, the indicative ceiling for the Directorate General of Human Settlements has been set at only Rp 11.07 trillion,” said Acting Director General of Human Settlements Chandra P. Situmorang during a meeting with Commission V of the House of Representatives on Monday (6/7/2026).
With the limited budget, the government is choosing to focus spending on completing ongoing work. The budget is also directed towards fulfilling commitments for community-based infrastructure programmes, paying multi-year contracts, and covering employee and operational expenses to ensure services continue to run.
“We report that in 2027, referring to the indicative ceiling, the Directorate General of Human Settlements cannot yet propose funding for new activities due to these limitations,” Chandra stated. From the total indicative ceiling of Rp 11.07 trillion, the majority has already been allocated for various priority needs. This situation means that a number of development proposals resulting from regional consultations and the National Development Planning Conference cannot be accommodated in the 2027 Draft State Budget.
“The Directorate General of Human Settlements understands that the 2027 work plan and budget must be prepared carefully by utilising the indicative ceiling optimally. For this reason, the indicative ceiling will be focused on priority and most urgent activities that have a direct impact on the community,” he said. Despite this, the unaccommodated budget needs remain substantial. Additional funding is required for the construction and improvement of drinking water supply systems, sanitation systems, strategic area development, construction of state buildings, and technical and operational support. “As we have conveyed, the total budget requirement for the Directorate General of Human Settlements programme in 2027 is Rp 30.42 trillion. With the existing indicative ceiling, there remains an unmet need of Rp 19.35 trillion,” Chandra stated.