State Audit Reform Sector Development Program

It was a challenge to administer the block grant mechanism for 50 BAWASDAs and Dewan Perwakilan Rakyat Daerah or Regional Parliament (DPRD) secretariats. All the BAWASDAs had to prepare institutional development plans (IDPs) for ADB approval in order to be eligible for grant funds. Subsequently, the BAWASDAs and the DPRD secretariats were required to coordinate with the MOHA-IG to ensure their budgets were included in MOHA-IG DIPA (the budget and the activities were prepared in accordance with the approved IDP). This process resulted in delays. The budget of the BAWASDAs and the DPRD secretariats was often approved in MOHA-IG DIPA at the end of the year, which gave the BAWASDAs less than three months to implement their activities. In addition, the BAWASDAs and the DPRD secretariats lacked experience in processing payments funded by loans and grants. These issues led to certain activities not being implemented, and to low disbursement by participating BAWASDAs and DPRD secretariats. Thus, it is imperative to simplify implementation arrangements. In addition, PIU staff must be properly trained before project implementation, and DIPA issues clearly understood and resolved upfront. Advance procurement action would be preferable.