A toll-road project is ongoing (ANTARA)
Within regional governments, the terms Direct Spending and Indirect can be found. Direct Spending reflects their commitment to improving the welfare of the public, so it became quite a controversy when a local government only allocated 50 percent for Direct Spending.
The ideal figure is 70 percent and 30 percent for Direct Spending and Indirect Spending, respectively. The bigger Direct Spending, the better.
However, said description becomes peculiar when we look at the Regional State Budget report as there are a lot of irrelevant points that would make you giggle.
In drawing up the budget, the government executives embrace the pure accounting approach instead of the psychological or sociology of development approach.
Some of the irrelevant points include spending for seminars at hotels and procurements office utensils.
Ironically, grants from the provincial government to develop villages, such as village roads, irrigation, health facilities and disaster mitigation are categorized as Indirect Spending.
We should view development through the holistic conception of science instead of the point-of-view conception. Embracing the latter may be misused by government officials to use the government’s money for their personal interest while evading corruption allegations at the same time. They may even claim that the big spending as an achievement and improve their status in their office.
NOT JUST ABOUT INPUT-OUTPUT – Government spending is not only about input and output. It is also outcome and benefits for the public. Auditors have been missing this out as they claim that assessment on the outcome and benefits does not fall within the realm of administrative audit and instead falls within the realm political audit, which is executed by legislators.
When the Supreme Audit Agency (BPK) gives the Unqualified Opinion for a region (Wajar Tanpa Pengecualian/WTP) to a local government for their excellent presentation of their administration, the fact in the field show that budget spending for developments of roads, electricity networks, clean water facilities and irrigation have been sluggish.
This creates a serious problem as the money collected for construction projects, from the exploitation of natural resources, taxes and overseas loans, are not being used to produce considerable effects for the people’s welfare.
Hence, I suggest the terms Direct Spending and Indirect Spending to be replaced with Spending for the Government and Spending for the Public.
*) The writer is the Regent of Purwakarta