BPK Reminds Government Debt to Exceed IMF Recommendation Limit

Jakarta, the Indonesia Supreme Audit Agency (BPK) found that the results of a review of fiscal sustainability in 2020 showed a trend of increasing government debt and interest costs that exceeded the growth of gross domestic product (GDP) and state revenues.

This was stated in the Summary of Semester Examination Results (IHPS) I of 2021 which was submitted by the Chairman of the BPK, Agung Firman Sampurna, to the leadership of the House of Representatives in Jakarta, Monday (7/12/2021).

Evergrande Shares Drop to Lowest Level in 11 Years
The results of the review are said to show that the COVID-19 pandemic has increased the deficit, debt, and SiLPA which has an impact on increasing the risk of fiscal management.

“In addition, the debt vulnerability indicator in 2020 has exceeded the limits recommended by the IMF and/or International Debt Relief (IDR),” citing the BPK explanation.

And the fiscal sustainability indicator (IKF) 2020 of 4.27 percent has exceeded the limit recommended by The International Standards of Supreme Audit Institutions (ISSAI) 5411 – Debt Indicators, which is below 0 percent.

The results of the review found that with regard to the implementation of fiscal transparency in 2020, the government has met most of the criteria for the pillars of fiscal transparency with the achievement of an Advanced level of 19 criteria or 40.42 percent.

Then the Good level is 17 criteria or 36.17 percent, the Basic level is 10 criteria or 21.28 percent, and the Not Met level is 1 criteria or 2.13 percent. “In addition, there is one criterion that cannot be assessed (Not Applicable),” quoted the BPK explanation.

The BPK explained that the results of a review of the fiscal independence of local governments in 2020 through a quantitative approach showed, among other things, that there was a high fiscal independence gap between local governments.

Of the total 503 local governments evaluated, 10 are in the independent category, 50 are in the category towards independence and 443 are in the not yet independent category.

In addition to the quantitative approach, the review of fiscal independence was carried out using a qualitative approach which showed that the quality of fiscal decentralization in the 4 local governments tested was in the Very Good category.

Reviewer overview

BPK Reminds Government Debt to Exceed IMF Recommendation Limit - /10

Summary

Jakarta, the Indonesia Supreme Audit Agency (BPK) found that the results of a review of fiscal sustainability in 2020 showed a trend of increasing government debt and interest costs that exceeded the growth of gross domestic product (GDP) and state revenues.

0 Bad!