USD43 million of peat agency budget unspent

(foresthints.news) - During 2017, the Indonesian Peat Restoration Agency (BRG) failed to spend the state budget allocated to it to the tune of almost half a trillion rupiah - the equivalent of around USD43 million. However, this shortcoming was not transparently conveyed by the peat agency when delivering its 2017 performance report at the end of December last year.

In fact, by mid-2017, the level of the peat agency’s budget absorption of state funds stood at a mere 1.2%. This poor performance resulted in the agency’s budget being cut by more than 50% - from IDR856.45 billion (around USD64.85 million) to IDR428.15 billion (around USD32.08 million), as previously reported by foresthints.news (Jul 6).

Data obtained by foresthints.news shows that even with its reduced budget, the peat agency’s budget absorption level only amounted to almost 68%, or not quite IDR289 billion (around USD21.6 million). In other words, over 30% of the state funds which had previously been cut by more than 50% were also left unabsorbed.

The mid-year budget cut of course helped the peat agency to ‘improve’ its budget absorption level. Without this budget cut, the peat agency would have failed to absorb almost 70% of its allotted 2017 state funds.

The failure of the peat agency to spend around USD43 million during 2017 serves as an important lesson in terms of its progress as well as for peat restoration efforts in Indonesia in general.

The revegetation target, for example, set in the peat agency’s strategic plan for 2017 was 20,000 hectares. This target was clearly not met. Compounding matters, the peat agency did not adequately report its performance in this respect to the public.

The photos below, taken by foresthints.news in mid-November last year, depict a revegetation pilot project spanning 4 hectares in Central Kalimantan’s Pulang Pisau regency.

Message to the international community

When it comes to funding commitments, the, international community should recognize that the Indonesian government itself has shown a strong commitment to peat restoration efforts by allocating an ample portion of the state budget for this purpose.

Nonetheless, the Indonesian peat agency has revealed itself to be unable use up this allocated state funds, with an unspent budget of roughly USD43 million representing a sizeable amount of money.

In submitting its 2017 performance details, the peat agency failed to disclose the target it was supposed to achieve last year, thereby concealing the difference between this target and the agency’s realization of it. The peat agency should instead have been transparent in explaining the extent of the gap between its 2017 target and realization. Unfortunately, it wasn’t.

The reluctance of the peat agency to present a transparent report is perhaps best explained by the fact that the realization of the 2017 target it set was low, in fact extremely low. This makes sense bearing in mind that the peat agency failed to spend almost 70% of the total state budget allocated to it in 2017 (prior to the more than 50% slash). 

Furthermore, the international funds absorbed for Indonesian peat restoration efforts during 2017 were also very low, far below expectations.

The figures mentioned above prove that in terms of the provision of state funds for peat restoration, the level of commitment on the part of the Indonesian government cannot be faulted. 

In contrast, the peat agency - due to its exceedingly poor absorption of state funds over the course of 2017 - is deserving of criticism for failing to properly execute its approved overall 2017 plan and budget.

It goes without saying that the peat agency itself should have divulged the actual facts and figures discussed in this news report, as well as issued a public apology for its failure to utilize around USD43 million of the state funds allocated to it for accelerating peat restoration efforts in Indonesia over 2017.