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New education budget scheme raises fear of funding cut
The Finance Minister has proposed a new state budget mechanism for meeting the mandatory 20 percent allocation for education, which has raised fears among experts that schools, teachers and students will all be left shortchanged.
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Students attend to their assignments on Aug. 22, 2024 on the porch of MIS Al-Khaeriyah elementary school in Tangerang regency, Banten. The private Islamic school, which is heavily damaged, has resumed learning activities in outdoor spaces and residential homes for safety. (Antara/Sulthony Hasanuddin)
T
he Finance Ministry has proposed changing the mandatory education budget from 20 percent of state expenditure to 20 percent of state revenue, raising concerns among experts that the new mechanism would cut funding overall for solving the perennial problems plaguing national education system.
The 1945 Constitution mandates a minimum education allocation of 20 percent of the state budget, but it does not specify whether this refers to 20 percent of state expenditure or revenue. The education budget is currently calculated as 20 percent of state spending.
But in a meeting on Wednesday with the House of Representatives Budget Committee (Banggar), Finance Minister Sri Mulyani Indrawati unveiled a proposal to change the allocation to 20 percent of state revenue instead, arguing that the volatile nature of government spending meant the current mechanism was ineffective and burdened the state coffers.
For example, the 2022 education budget increased by default after the government increased the energy subsidy by Rp 200 trillion (US$12.9 billion) in the middle of the fiscal year due to rising oil prices, but educational institutions could not absorb the extra funds in the adjusted education budget because academic programs were already underway.
Banggar head Said Abdullah, who hails from the Indonesian Democratic Party of Struggle (PDI-P), agreed with the minister’s proposed mechanism, and told the meeting he would write a letter to the House Legislation Committee (Baleg) to revise the 2003 National Education Law.
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Funding cut fears
