Decentralized budget fails to even regions: expert

The amount of state money transferred to regions, though increasing every year, has apparently failed to even both population and economic growth distributions in regions, an expert said in Jakarta on Thursday.

Gadjah Mada University economist Anggito Abimanyu said the amount of state funds transferred to regions increased from Rp 30 trillion (US$3.52 billion) in 1999, to Rp 150 trillion in 2005, Rp 309 trillion in 2009 and Rp 344.5 trillion in 2010.

"But there is practically no difference whatsoever in the distribution of population according to the population surveys in 2000 and in 2010. People are still concentrated in [already developed regions]," Anggito said during a hearing with House of Representatives Commission XI overseeing financial affairs.

"So there is no flow of people following the flow of money, when that's what should've happened. Money transferred to regions, although continually increasing, is still only benefiting certain people," added the former head of the Finance Ministry's Fiscal Policy Agency.

He said the same conditions could be seen in the distribution of gross regional domestic products (GRDPs), with the GRDP portions of several major islands in 2010 barely changing from 2000 when compared to the GDP.

Java Island still holds the largest portion of the GDP in 2010, barely dropping from its 2000 portion, while other islands record minuscule increases or no changes at all.

"So there is definitely something that needs reviewing in our regional autonomy and budget decentralization policies, which have been in place for about 10 years now," Anggito said.