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Jakarta Post

Government pledges to cut red tape to accelerate healthcare spending

  • Adrian Wail Akhlas

    The Jakarta Post

Jakarta   /   Thu, July 9, 2020   /   02:11 pm
Government pledges to cut red tape to accelerate healthcare spending A nurse takes a swab sample from a man at the Tanah Abang district office in Central Jakarta in this undated photo. The government has pledged to accelerate healthcare spending, including disbursing incentives for medical workers, as bureaucratic red-tape hinders the process amid a surge in virus cases. (JP/P.J.Leo)

The government has pledged to accelerate healthcare spending, including disbursing incentives to medical workers, as bureaucratic red tape hinders the process amid a surge in virus cases.

The Finance Ministry’s special staff member for state expenditure Kunta Nugraha told reporters on Wednesday the government had only spent 5.12 percent of the Rp 87.55 trillion (US$6.06 billion) budget for health care due to complicated verification and lengthy approval processes.

“The main problem is we need to verify the incentives distributed to medical workers and the process is taking a bit too long, from claims by healthcare facilities to verification by regional administrations and the central government,” Kunta said, adding that the government was taking measures to cut red tape.

“We will now cut the process by allowing regions to verify and [directly] decide who will receive the incentives. We want to make a breakthrough but also maintain good governance,” he added. The government, he went on to say, aimed to provide flexibility in a bid to expedite spending.

Read also: Administrative issues hamper COVID-19 budget disbursement: Sri Mulyani

The government has allocated Rp 87.55 trillion from the state budget to strengthen the healthcare system, including Rp 65.8 trillion for COVID-19 management, nearly Rp 6 trillion in incentives for medical workers and tax incentives worth Rp 9 trillion, among other allocations.

The funds are part of the government’s Rp 695.2 trillion pandemic response budget to strengthen the nation’s healthcare system and support the economic recovery.

Ministry officials are working to speed up spending of the allocated budget as President Joko “Jokowi” Widodo called on ministers recently to go the extra mile to accelerate policy making on the pandemic and the disbursement of funds. He even threatened, in an uncharacteristic speech, to reshuffle the Cabinet should the ministers fail to expedite spending.

The government is borrowing huge sums of money, with the budget deficit rising to 6.34 percent of gross domestic product (GDP), more than double the previous legal ceiling of 3 percent,  as it seeks to strengthen the healthcare system amid a spike in cases and bolster the virus-battered economy.

As of Wednesday, the government had recorded more than 68,000 cases of coronavirus infection, with a daily infection rate of more than 1,000 in recent weeks, official data show.

Medical workers associations across the country have called on the government to provide the promised incentives for medical workers, with many workers still waiting despite being on the front lines in the fight the pandemic.

“The incentives are too slow to come through even though they are crucial for medical workers,” said East Java medical workers association chairman Sutrisno as reported by Kompas.com. “This [disbursement of funds] should be improved by public health authorities.”

Read also: Government guarantees $6.9b in working capital loans for MSMEs

Business associations are also anxious as they have yet to receive the incentives promised by the government to bolster the economy.

“After the debt restructuring process, we now need working capital loans for micro, small and medium businesses as well as [big] businesses,” said Indonesian Chamber of Commerce and Industry (Kadin) chairman Rosan Roeslani, urging banks to soon disburse the working capital loans.

The government has guaranteed the provision of Rp 100 trillion in working capital loans for micro, small and medium enterprises (MSMEs) following the launch of a loan guarantee program to help small businesses survive the pandemic.

Finance Minister Sri Mulyani Indrawati said on Tuesday that she expected banks would channel between Rp 65 trillion and Rp 80 trillion in loans over the next 18 months.