Indonesia's Finance Ministry Implements Budget Efficiency Measures

New Budget Review Policy

The Indonesian Finance Ministry has introduced a new policy called Rincian Output (RO) through Finance Minister Regulation (PMK) Number 56/2025. This regulation outlines the procedures for implementing spending efficiency within the 2025 State Budget (APBN). The policy aims to enhance budget allocation effectiveness by separating funds for priority programs.

Budget Reallocation Process

Director General of Budget Luky Alfirman explained that the budget review will specifically target ministries and government agencies (K/L). The process involves identifying expenditures that can be optimized and reallocating them to priority programs through a special RO in their respective budget allocation documents (DIPA). Importantly, while funds will be earmarked for specific priorities, the overall budget allocations will remain with their respective ministries.

Distinction from Previous Efficiency Measures

The new RO policy differs from previous presidential instructions (Inpres) regarding state expenditure efficiency. Luky emphasized that this approach allows for more targeted optimization within ministry budgets while maintaining their overall financial authority. The Finance Ministry believes this method will lead to more effective budget management and better alignment with national priorities.