Sunday, 26 February 2012


          One of the brokerage practice issue which are frequently talked about recently is budget brokerage for regional development. Budget brokerage occurs as a result of the expectation of some regional governments to get additional budget allocation from the central government by not abiding to the budget allocation procedure. Those regional governments only expect to obtain budget instantly, and this opens a chance for budget brokers to launch their opens a chance for budget brokers to launch their actions.

            Budget brokerage is hard to be detected as it gives mutual benefit. The broker will receive fee for the services he or she performed. On the other hand, the Satuan Kerja Perangkat Daerah (SKPD) also receives large amount of budget for certain projects. Executive Director of the Regional Autonomy Implementation Monitoring Committee (KPPOD), Agung Pambudi, stated this matter in Jakarta on Monday (January 16, 2012). One of the methods to detect budget line whether it involves budget broker or not, according to Agung, can be seen from Budget Allocation List (DIPA). “If there is any program that receives higher amount of budget if compared to the average rest, it should be suspected”, Agung said.

            Agung admitted that the existence of budget brokers is difficult to be proven legally. Until now, there are many budget brokers who pay a specific amount to the House of Representatives to smoothen budget distribution from central to regional government. According to him, the cause of the budget brokerage practices is complicated process of budget allocation. He explained that in the financial equilibrium system, there are not only DAU, DAK, and DBH, but there are also Dana Dekonsentrasi and Tugas Pembantuan.

            To minimize budget brokerage practices, according to Agung, there should be an administrative order whether at executive or legislative level. Administrative order should cover all lines, starting from budgeting cycle which must be valid and punctual in order to prevent dispute between the executive and the legislative bodies. And, from the aspect of budget discipline, a tender is required. If the administration is in good order, it will minimize the chance of budget brokers to launch their actions”, Agung said.

            Agung emphasized on the process of arrangement of Revised Regional Budget (APBD-P) or State Budget (APBN-P). According to him, in APBD-P, the substance is changed. But what happens is the opposite. Based on surveys performed, there are many funds which are not written in APBD-P, but have been realized. Budget brokerage is a heavy work for KPK (Corruption Eradication Commission) and BPK (Supreme Audit Agency). These two institutions must stop brokerage practices that harm the society.

            Brokerage occurs as a result of unoptimal service provision and a chance that can benefited in various public and bureaucracy services. Agung added that the brokers promise to smoothen process of budget allocation to the regions or to increase amount of the budget allocated by paying them a certain amount of fee. These brokers do not consider which regions are eligible to receive funding. They only think about personal gain. 

Business News, January 18, 2012 

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