Public Works Minister: Construction industry prompts economy to grow more than 5%
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily: Menteri PUPR: Industri Konstruksi Sokong Pertumbuhan Ekonomi di Atas 5%
9 August2018
By Eko Adityo Nugroho
Jakarta — Public Works and People’s Housing (PUPR) Minister Basuki Hadimuljono claimed construction industry has become one of the industries that support national economic growth, besides the consumption sector.
His statement is in line with data from the Statistics Indonesia (BPS), which shows that in the second quarter of 2018, Indonesia’s economy grew by up to 5.27%.
“As one of the ministries with the largest budget, the absorption of the PUPR ministry budget as government spending plays a role. Therefore, the absorption is expected to be realized evenly, not piling up at the end of the year, so economic growth above 5% can be maintain,” said Basuki in his official statement in Jakarta, Wednesday (8/8).
The 2018 budget absorption target is 94.16% or Rp107.07 trillion of the total budget of Rp113.71 trillion. For the realization of budget absorption until 6 August 2018, the financial progress had reached 38.1% or Rp43.32 trillion and the physical project 41.78%.
“The percentage of these progresses is slightly lower compared to the physical and financial progresses in 2017, which are 45.65% and 38.26% respectively,” added PUPR Ministry Secretary General Anita Firmanti.
Basuki continued that besides accelerating the realization of infrastructure spending, all of PUPR Ministry’s regional offices and task forces are demanded to pay attention to the quality of infrastructure by stepping up supervision and well managing infrastructure assets which have been built.
“PUPR Ministry’s regional offices play a role not only as construction manager who only focuses on construction, but also as infrastructure manager. Heads of the offices and the staff are required to know what assets they have, the condition, location, and utilization of infrastructure assets under their responsibility. In addition, each office is required to supervise every infrastructure work in their area, including work handled by regional government if there are things that aren’t in accordance with public works’ technical rules,” he explained.
2019
Meanwhile, in 2019 the PUPR Ministry will have additional tasks to build and rehabilitate several infrastructures, such as schools, markets, universities, and pondok pesantren (Islamic boarding school). It is in accordance with the government’s focus on infrastructure and human capital development.
“This is a task entrusted to us and we must carry it out. To that end, we will set up a special unit to manage programs/tasks under PUPR Ministry’s Directorate General of Human Settlements. With greater responsibility, we need to sharpen our programs to increase our expenditure capacity and build more assets whose merits can be directly felt by the society,” said Basuki.
With the PUPR Ministry taking over the physical construction of schools and universities, headmasters and teachers can focus more on the teaching and learning activities. Similarly, the PUPR Ministry will also handle the physical construction of pondok pesantren, because based on the fact in the field, plenty of pondok pesantren are no longer suitable for students to study. Moreover, the PUPR Ministry has also coordinated with related ministries, such as with the Trade Ministry for market construction.
Basuki revealed that to carry out the additional tasks, the PUPR Ministry is granted an additional budget of Rp6.5 trillion for the fiscal year 2019. Hence, the budget ceiling for the PUPR Ministry in 2019 totals Rp110.73 trillion.
In 2019, the PUPR Ministry’s infrastructure program policy will aim to create equitable development to close the gaps among regions by among others, intensifying cash for work program.
On the other hand, Basuki urged every River Basin Area Centre to coordinate with the Meteorology, Climatology, and Geophysics Agency (BMKG) to predict drought and flood.
