Jakarta –
The government is again implementing the Automatic Adjustment policy or spending reserves for Ministries/Institutions (K/L). blocked temporarily from the spending ceiling in 2023. This was done in order to deal with conditions of global economic uncertainty and geopolitical turmoil.
“Automatic Adjustment is not a budget cut. It is an anticipatory strategy against global economic uncertainties and current geopolitical conditions, through spending priorities,” said Minister of Finance Sri Mulyani Indrawati in a written statement, quoted on Sunday (19/2/2023).
The Automatic Adjustment policy asks all Ministries/Institutions to block a portion of the budget that has not been prioritized for implementation at the beginning of the year. With this policy, Ministries/Institutions are directed to prioritize spending that is really important so that all Ministries/Institutions have the resilience to anticipate if changes must be made in the face of the impact of global uncertainty.
In its implementation, K/L proposes activities/KRO/RO/accounts to be blocked in accordance with the amount of Automatic Adjustment of each K/L attached to the Letter of the Minister of Finance concerning Automatic Adjustment of K/L Expenditure for 2023 through a budget revision mechanism.
In total, the Automatic Adjustment value of K/L spending in 2023 is set at IDR 50,232,277,303,000 originating from K/L spending in Pure Rupiah (RM) taking into account the performance of budget realization over the last three years (2020-2022).
Prioritized activities for Automatic Adjustment include personnel spending that can be streamlined, spending on goods that can be streamlined (prioritizing expenses for honoraria, official travel, meeting packages, spending on other operational goods and spending on other non-operational goods), capital spending that can be streamlined, non-permanent social assistance, as well as activities that are not expected to fulfill the implementation supporting documents until the end of semester I-2023.
Budgets excluded from the Automatic Adjustment policy, namely spending related to permanent social assistance include: Recipients of Contribution Assistance (PBI) for Health Insurance, Family Hope Program (PKH) and Basic Food Cards; expenditures related to election stages, expenditures for payment of Multi-Year Contracts, and expenditures for Availability Payments.
“Looking at the things that are prioritized and excluded, Automatic Adjustment will not interfere with the achievement of national development targets and the targets of each K/L,” he added.
With regard to government priority spending, basically the portion of the budget will not be reduced. For example, Automatic Adjustment will not reduce the allocation of 20% of the education budget because it is blocked, not reduced/eliminated.
These activities can still be carried out if by the end of the first semester there is no significant budget requirement. K/L can submit proposals for gradual unblocking to fund K/L activities through a revision mechanism.
“The entire process for the Automatic Adjustment of K/L spending for the 2023 fiscal year is to be carried out in a transparent, accountable and responsible manner, and free from Corruption, Collusion and Nepotism (KKN),” said Sri Mulyani.
(aid/dna)
