2017-07-06

Peat agency’s budget absorption level at 1.2% by mid-year 2017



JAKARTA
(foresthints.news) - Results of monitoring performed by the Indonesian Ministry of Finance show that the budget absorption level of the Peat Restoration Agency (BRG) by the middle of this year stood at 1.2%. As such, in performance terms, the ministry has classified the peat agency as extremely underperformed.

For the current fiscal year, the peat agency obtained state budget funds in excess of IDR865 billion, equivalent to more than USD64 million (at an exchange rate of USD1 to IDR13,300). These funds were channelled through the Ministry of the Environment and Forestry.

“There have been a number of administrative constraints. Our resources are also limited, such as staffing. We also do not yet have work units at the provincial level to execute our state funds,” Peat Agency Chief Nazir Foead explained to foresthints.news (Jul 5) during a discussion held in Jakarta about the peat agency’s performance.

Nazir described how this situation had caused the peat agency to submit a request to the Environment and Forestry Ministry to carry out a mid-year budget review in order to produce a set of inputs as a means of accelerating the budget absorption.

“We also presented this situation to the parliament last month when the peat agency’s budget absorption level was still at 0.97%,” he said, adding, “We are continuing to take various steps to expedite (the agency’s budget absorption).”

Full gear and full speed in 2017?

In mid-December last year, Peat Agency Chief Nazir Foead promised that peat restoration work would be conducted ‘in full gear with full speed’ in 2017, as set out in his opening speech at the 2016 International Peatland Symposium.

However, having reached the mid-point of the year and with a lamentably low budget absorption level of just 1%, the promise of ‘in full gear with full speed’ appears increasingly tough for the peat agency to live up to.

The two photos below demonstrate the distribution of 2015’s burned peat areas in Central Kalimantan’s Pulang Pisau regency, which is incorporated in the indicative targeted peat restoration map. The exceedingly poor budget absorption performance by the peat agency has unquestionably had a serious impact on its real performance on the ground level.



The peat agency’s tiny budget absorption level - which resulted in it being classified as extremely underperformed based on the Finance Ministry’s monitoring - is almost certain to lead to a significant budget cut for the agency in the 2018 fiscal year.

Immediate review

Meanwhile, the Inspectorate General of the Environment and Forestry Ministry acknowledged that it had received the peat agency’s request for a review of its budget utilization performance.

“We have received a letter from the peat agency requesting us to review its budget utilization performance,” said the Ministry’s Inspector General, Imam Hendargo, in response to a question from foresthints.news (Jul 3) at the ministry building.

The essence of such a review, he continued, would be to assess the constraints and obstacles encountered by the peat agency in spending its allocated budget.

“The spirit (of the review) would be about how the peat agency can improve its budget absorption performance so that it can deliver outputs which speed up peat restoration,” Imam explained.

The primary consideration in the establishment of the peat agency was in fact to accelerate peat restoration, especially in burned peat areas after 2015's massively destructive peat fires.

However, the acceleration of peat restoration has undoubtedly been affected by the peat agency’s extremely low budget absorption level, particularly this year. The adverse effects of this situation are likely to be felt further with serious reductions in the peat agency’s 2018 budget on the cards.