Papua's Budget Allocation Increases by 12.6% in the 2022 State Budget

The Indonesian government has extended the special autonomy (otsus) for Papua and West Papua provinces from 2022 to 2041. This is stipulated in Law Number 2 of 2021, which amends Law Number 21 of 2001 concerning Special Autonomy for Papua Province, enacted on July 19, 2021.

With this extension, the government has allocated Rp 8.5 trillion (approximately USD 570 million) for otsus in Papua and West Papua in the 2022 State Budget Draft (RAPBN). This is 12.6% higher than the Rp 7.6 trillion (approximately USD 510 million) outlook in the 2021 APBN.

The otsus fund amounts to 2.25% of the General Allocation Fund (DAU) ceiling of Rp 378 trillion (approximately USD 25.4 billion). Previously, it was 2% of the DAU ceiling.

The increased allocation is due to the high cost of development in Papua and West Papua, given the significant geographical challenges. The funds will be used for two policy formulations.

First, 1% of the DAU is allocated for general purposes, such as the construction and maintenance of public service infrastructure, improving the welfare of indigenous Papuans (OAP), strengthening customary institutions, and regional priority activities. Second, 1.25% of the DAU is allocated to education (at least 30%), health (at least 20%), and community economic empowerment.

The realization of otsus funds in Papua and West Papua previously decreased due to the COVID-19 pandemic. Realization in 2020 was Rp 7.56 trillion (approximately USD 508 million), down 9.6% from Rp 8.36 trillion (approximately USD 560 million) the previous year. This year's realization is predicted to remain stagnant.