Story of Change

Bener Meriah Smartens up to Receive Regional Incentive Fund

Author: Andhiani Manik Kumalasari / Paulus Enggal Sulaksono
Published: 12/05/2022
Regional Incentive Fund helps Bener Meriah to develop its region.

As a new district and New Autonomy Region resulting from the proliferation of Central Aceh District in 2003, Bener Meriah requires a lot of funds to finance its development. It can no longer relies solely on the Fiscal Balance Transfer[1] sourced from the State Budget’s income that is allocated to finance regional needs for the purpose of decentralisation.

Even the Local Own-Source Revenue (PAD)[2] is still insufficient to finance the development of this new district. Therefore, Bener Meriah urgently requires another valid source of income, including the non-fiscal balance transfers, such as the Regional Incentive Fund (DID).[3] Ever since its introduction in 2011, Bener Meriah District Government had not utilised DID as a revenue target in the Regional Transfers and Village Fund (TKDD).[4] This had caused instability of DID allocation in Bener Meriah.

In 2017, Bener Meriah District managed to receive Rp54,413,625,000 of DID. However, in 2018 and 2019 the amount was reduced to Rp35,750,000,000 and Rp11,171,741,000 respectively.

Due to its inability to secure a sufficient fund from DID in the Financial Year (FY) of 2020, Bener Meriah District had to cancel several development programs and activities in the pipeline. Thankfully, the district managed to receive an additional DID of Rp9,474,092,000 later in the year. This has encouraged Bener Meriah District Government to improve their performance indicators required to receive a higher amount of DID, in accordance with the Circular Letter of Aceh Governor No. 470/21210 on the Improvement of Regional Performance Indicators to Support the Increase of Regional Incentive Fund Revenue for the Financial Year of 2021.

DID Performance Planning Coordination

As an effort to secure higher DID in FY 2021, Bener Meriah District Government in collaboration with Kolaborasi Masyarakat dan Pelayanan untuk Kesejahteraan (KOMPAK) established a Regional Incentive Fund Planning Coordination Team or popularly known as “DID Team”. The key to the successful establishment of DID Team in Bener Meriah is the role of the district head, who has initiated and been actively involved in chairing the coordination meetings to evaluate DID performance in Bener Meriah since the beginning.

One of the strategies implemented to improve DID performance is the regular coordination with relevant Regional Apparatus Organisations (OPD)[5] in the source of performance assessment. The District Government also coordinated with Statistics Indonesia (BPS)[6] of Bener Meriah to align the regional development data and to identify opportunities available to secure DID in 2021.

Out of the steps taken, the team managed to map out the resources and supporting data required to meet the priority indicators in DID performance planning for 2021. Several indicators used in regional rating and DID allocation are education, health, infrastructure, community welfare, government public service, export increase, investment, waste management, inflation management, and corruption prevention.

These indicators became the reference for the DID Team to build intersectoral coordination, drive performance improvement efforts, and provide supporting data for DID assessment.

"It is not the result of lobbying, but the result of performance that met the indicators. KOMPAK unceasingly helped us to understand those indicators," said the Head of Bener Meriah Regional Development Planning Agency (Bappeda),[7] Drs. Khairun Aksa, S.E., M.M.

Other efforts carried out by the local government and KOMPAK to address the challenges was to organise Focus Group Discussions (FGD) and workshops to discuss performance improvement efforts for the purpose of receiving DID, disseminate information on the policy direction for the subsequent year’s DID indicators performance assessment, and prepare technical recommendations to estimate the amount of DID based on existing data, both from BPS and the ministries/institutions. The results of the FGDs and workshops were followed up by preparing a mechanism that is in line with the regional rating and DID allocation for distributing incentives to villages based on the indicators. KOMPAK also encouraged the local government to provide basic public services and local economy development.

Furthermore, coordination aimed to complete the Medium-Term Development Plan (RPJM)[8] as well as to realise the vision and accomplish the mission of the district head was also carried out. To meet the DID requirements, Bener Meriah District Government also trained 12 Local Government Department (SKPD)[9] Heads and 18 functional officers to increase their knowledge of DID indicators and performance assessment.

Bener Meriah Secured the Highest DID

The collaboration between Bener Meriah District Government (through Bappeda) and KOMPAK has been successful. From zero DID the previous year, the district managed to secure Rp63.87 billion in 2021. This achievement has placed Bener Meriah as the largest DID recipient in Sumatra. “This was the result of a teamwork, not individual work,” said Khairun happily.

The achievement did not stop there. In the same year, Bener Meriah was given a Human Development Index of 90 with B rating in public welfare sector. This has helped the district to secure a large amount of DID. Another indicator met in the DID assessment was the declining number of unemployment.

Nevertheless, the most determining factor for Bener Meriah in securing the DID was the Unqualified Opinion rating from the Audit Agency (BPK)[10] for their Regional Government Financial Report in 2019.

It was because of this achievement that Bener Meriah policymakers became more aware of the indicators assessed by the Ministry of Finance of the Republic of Indonesia to determine DID recipients. These indicators include timely ratification of Regional Budget, the use of e-Budgeting and e-Procurement in governance, handling of stunting (which received a score of 80 and B rating), and childbirth delivery at medical facilities (which received a score of 90 and B rating).

Nevertheless, Khairun admitted that the DID received in 2022 was lower than 2021. He explained that this was understandable, considering the additional criteria set by the Ministry of Finance. “We are optimistic that in the next few years our DID will be on the up as we continue to update the data required for DID assessment,” said Khairun.

Khairun’s optimism was backed by the fact that more and more SKPDs were becoming aware of the criteria required for DID assessment and how to meet them so they could achieve the same success as in 2021. Moreover, Khairun explained that the institutions in Bener Meriah have managed to foster better communication and cooperation. They also received better support from policymakers in terms of regulations that will help secure the DID needed for regional development.

DEPIK encourages improvements in the quality of basic services and improvements in inclusive governance

DID Allocation and DEPIK Utilisation

Sadly, M. Junaidi AR, M.Si., AK.CA., Secretary of Financial and Asset Management Agency (BPKA)[11] in Bener Meriah District admitted that the large amount of DID received in 2021 has not been able to directly reach the lower-class residents. According to him, this was normal, considering that the benchmark for DID-sourced programs was not solely infrastructure development, but also development of education and health sectors, economic strengthening, and social protection.

“In the future, we aim for the program implementation and budget allocation to truly address our current problems,” said Junaidi. “The programs prepared by KOMPAK are positive and will benefit the wider public in the next five years,” he added.

Furthermore, to support a more transparent and on-target budget allocation at village level, in 2021 Bener Meriah District in collaboration with KOMPAK prepared a DID derivative model called the Village Development Incentive Fund (DEPIK).[12] The legal basis for DEPIK implementation is the District Head Regulation (Perbup)[13] No. 30 of 2020 on Procedures for the Assessment and Determination of Village Development Incentive Fund (DEPIK). This model helps the village government to synergise with the district government. DEPIK dissemination is also in line with the dissemination of DID budget allocation for the development of each village, so that residents can find out the source of budget for the development in their village.

***


[1] Dana Perimbangan

[2] Pendapatan Asli Daerah

[3] Dana Insentif Daerah

[4] Transfer ke Daerah dan Dana Desa

[5] Organisasi Perangkat Daerah

[6] Badan Pusat Statistik

[7] Badan Perencanaan Pembangunan Daerah

[8] Rencana Pembangunan Jangka Menengah

[9] Satuan Kerja Pemerintah Daerah

[10] Badan Pemeriksa Keuangan

[11] Badan Pengelolaan Keuangan dan Aset

[12] Dana Insentif Pembinaan Kampung

[13] Peraturan Bupati

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