Indonesia: Budget Credibility and the Sustainable Development Goals

The Indonesian government has made a firm commitment to meeting the targets of the Sustainable Development Goals (SDGs) by 2030, as evidenced by Presidential Regulation No. 59/2017. Development program action plans at the national and regional levels align with the SDGs and their associated targets. To have a significant impact on accelerating achievement of the SDGs, Indonesia should develop a mechanism to translate these action plans into development programs and activities.

Many countries face the challenge of budget credibility—the ability of a government to implement its budget as planned. This credibility is the goal of SDG indicator 16.6.1, which compares government budget planning with implementation. The Indonesian government’s budget performance in the four years spanning 2017-2020 showed overall implementation rates of 93% (2017), 100% (2018), 92% (2019), and 93% (2020). When disaggregated, however, the government’s budget reporting indicates a range of underspending and overspending in seven sectors that contribute to achievement of the SDGs.

This brief aims to assess the budget’s credibility in achieving the SDGs across these seven sectors in Indonesia: (1) Agriculture and Food, (2) Education, (3) Environment, (4) Gender Equality, (5) Social Protection, (6) Health, and (7) Clean Water and Sanitation. Furthermore, the purpose of this study is to assess the suitability of the central government’s plans and budget implementation for the 2017-2020 fiscal years. The study attempts to compare budget trends in Indonesia with progress toward achieving the SDGs, as presented in the sustainable development index report.

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