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Problem of dualism: Graft vs public finances
For almost one and a half decades, reforms of the state’s financial management have been gradually carried out.
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A handcuffed man offering bribe. (Shutterstock/File)
C
orruption is a major challenge for Indonesia in realizing its objective of creating a just and prosperous society. It undermines the capacity of the country to implement development programs, reduces public trust in the state and is the reason for ineffective implementation of government programs.
Corruption also affects the quality of policies issued by the government, which in turn affects government efforts to improve the welfare of the people. Therefore, it is of utmost importance to ensure measures to eradicate corruption.
Theoretically, corruption can be eliminated through a preventive approach by reforming public financial management. Good financial management with a credible and adequate control system is expected to be able to minimize the risk of corrupt practices in public institutions.
For almost one and a half decades, reforms of the state’s financial management have been gradually carried out, such as through the issuance of the State Finance Law in 2003, the State Treasury Law and State Financial Management and Accountability Audit Law in 2004.
