The westernmost and easternmost regions of Indonesia can breathe a sigh of relief. Minister of Finance Sri Mulyani Indrawati stated that the Special Autonomy Fund (Otsus) for Aceh Province and Papua Province will no longer be included as a government budget efficiency target in the 2026 State Budget Plan (RAPBN).
Previously, as a follow-up to Presidential Instruction Number 1 of 2025 concerning Spending Efficiency in the Implementation of the APBN and APBD for Fiscal Year 2025, the Ministry of Finance reduced the 2025 APBD. The budget efficiency is regulated through Decree of the Minister of Finance Number 29 of 2025 concerning Adjustments to the Details of the Allocation of Transfers to Regions by Provinces/Regencies/Municipalities for Fiscal Year 2025 in the context of Expenditure Efficiency in the Implementation of the 2025 APBN and APBD.
Based on the Decree of the Minister of Finance, the budget for transfers to regions (TKD) in 2025 was cut by IDR 50.59 trillion. Meanwhile, the Papua Special Autonomy fund remains Rp 9.69 trillion from the ceiling of Rp 10.04 trillion. Meanwhile, the Aceh Special Autonomy fund from Rp 4.46 trillion was cut to Rp 4.3 trillion.
Then, for the underpayment of revenue sharing funds, from a total ceiling of IDR 27.80 trillion, IDR 13.90 trillion was cut. Meanwhile, the DIY Privilege Fund, from Rp 1.2 million, was cut by Rp 200 billion. The Village Fund, from a ceiling of IDR 71 trillion, was cut by IDR 2 trillion.
Well, in contrast to the policy for this year, next year the allocation of the Special Autonomy Fund in the 2026 Draft State Budget is set at IDR 13.1 trillion. Although this allocation is down when compared to the 2025 allocation of Rp 17.52 trillion, the decision is considered quite positive, because it can accelerate regional development without any funding cuts. Thus, development is maximized.
Economic observer from the Institute for Development of Economics and Finance (Indef) Eko Listiyanto said that the Special Autonomy Fund can be utilized to accelerate development, because special autonomy recipient regions can catch up with other regions.
"The use of these funds is prioritized to improve the quality of life of the community through improved services in the education, health and economic sectors," he explained to SUAR, Wednesday, September 3, 2025.
Focus on basic education and health
Finance Minister Sri Mulyani emphasized that the Special Autonomy Fund is still prioritized for the education, health, and basic infrastructure sectors in special autonomous regions, especially Papua.
"For now there is no plan to make efficiency for the Special Autonomy fund. The most important thing is that Otsus can be delivered," said Sri Mulyani in a working meeting of Committee IV DPD with the Minister of PPN / Head of Bappenas and the Governor of Bank Indonesia on Tuesday, September 2, 2025.
He explained that the use of Papua Province's Special Autonomy funds will be directed at three main programs, namely Healthy Papua, Smart Papua, and Productive Papua. For the education sector, funds are focused on scholarships for Papuan Excellent Students (Basiswap), construction of new schools, and classroom repairs. In the health sector, allocations are used for the construction of hospitals, health centers, and other medical service facilities.
In addition to education and health, Otsus funds are also aimed at basic infrastructure development. Priority projects include housing, roads, bridges, ports and docks.
Funding support is also allocated for the procurement of internet and telecommunication facilities, electricity units, drinking water supply systems (SPAM), reservoirs, and waste management and environmental sanitation facilities.
Regarding the Special Autonomy Fund, according to Sri Mulyani, President Prabowo Subianto also asked her about the results of the budget to the regions. Understandably, every year the Special Autonomy Fund is always budgeted in the APBN, but there are no tangible results for the community - even though funds are always given.
Every year the Special Autonomy Fund is always budgeted in the APBN, but there are no tangible results for the community - even though funds are always given.
"After more than 10 years, is there no evaluation? On the one hand, the funds are available every year, but on the other hand, maybe people don't see it in real terms," said Sri Mulyani.
Therefore, next year the government will increase the absorption of Otsus funds so that they can be utilized more optimally by recipient regions.
Answering regional aspirations
Chairman of Committee III DPD RI, Filep Wamafma, welcomed the government's decision to ensure that Special Autonomy (Otsus) funds are not included in the list of budget efficiency in 2026.
According to Filep, this step is the right response to the aspirations of the Papuan people who have been relying on Special Autonomy funds for regional development.
"As the leader of Committee III DPD RI as well as the regional representative of West Papua, I appreciate the government's decision to ensure that the Special Autonomy fund is not affected by efficiency next year. This answers the aspirations that we conveyed in the Plenary Meeting of DPD RI last March, "said Filep.
Filep emphasized that the government needs to be careful in making policies related to the Special Autonomy fund. He said, most provinces in Tanah Papua are still very dependent on these funds as a source of strengthening the APBD.
