The Indonesian Ministry of Finance has requested experts from Universitas Gadjah Mada (UGM) to research the effectiveness and efficiency of budget utilization within local government environments across Indonesia.
This initiative aims to ensure that government budgets benefit development and improve the economies of lower-income communities.
This collaboration was highlighted during the visit of the Secretary-General of the Indonesian Ministry of Finance, Heru Pambudi, to UGM, where he was received by the UGM Vice-Rector for Education and Teaching, Professor Wening Udasmoro, on Monday (Apr. 22) at the leadership meeting room, UGM Central Building.
Vice-Rector Udasmoro stated that the collaboration between UGM and the Indonesian Ministry of Finance has been ongoing for a long time. However, during this working visit, they discussed the follow-up of the memorandum of understanding signed by both parties.
The collaboration has encompassed various educational aspects, such as scholarship programs, research activities, user satisfaction surveys, and community service through real-work lecture programs and SME empowerment.
“This collaboration is expected to bring benefits to both parties. We continue to innovate and produce knowledge related to our outputs to benefit society,” said the vice-rector.
She also expressed appreciation and gratitude to the Ministry of Finance for its contributions to human resource development in Indonesia through scholarships provided by LPDP for Indonesian students pursuing education at UGM.
“We sincerely hope that programs like this will continue to benefit human resource development,” she added.
During the meeting, Professor Udasmoro mentioned that UGM is open to receiving Ministry of Finance personnel to enhance their competencies in various fields of expertise, particularly in IT, programming, AI, data analytics, litigation law, and green economic development concepts.
Heru Pambudi stated that the Ministry of Finance is currently undergoing reforms, especially in optimizing the number of employees. He mentioned that the ministry currently has 77,812 employees. For efficiency purposes, the target is to reduce this number to 74,118 by 2029.
They encourage employees to pursue advanced studies and participate in various short-course training programs to enhance competencies.
“On average, only 50% of retiring employees are replaced by recruits,” he said.
Pambudi briefly touched on the research collaboration regarding the effectiveness and efficiency of budget utilization in local government environments. He hoped that UGM could develop a model to assess whether local governments’ budgets truly contribute to the community’s economy.
“The Ministry of Finance contributes to regional development. We want UGM to become a model of how budget management and utilization can be more effective and efficient, encouraging faster regional economic strengthening to provide a multiplier effect,” he stated.
He acknowledged that many government spending programs, including budget allocations, may only benefit lower-income communities with strict supervision. He emphasized that fund transfers to regions, micro-business loans (KUR), and tax incentives should be more targeted.
“It’s not just about money but also about KUR to tax incentives. I want this collaboration to produce outcomes in terms of outcomes,” he added.
UGM economist Dr. Elan Satriawan mentioned that government spending programs in various sectors aim to control inflation effectively and should directly benefit local communities. He stated that this collaboration between UGM and the Ministry of Finance ensures the extent of budget absorption across multiple sectors.
“We will use a multidisciplinary approach and provide excellent data related to this matter to provide feedback to the central government,” he concluded.
Author: Gusti Grehenson
Photographer: Donnie