Papua Special Autonomy Fund disbursement delays

The Indonesian Ministry of Home Affairs has called for the acceleration of the 2026 Special Autonomy Fund (Otsus) disbursement across Papua. In late August, Deputy Minister Ribka Haluk instructed local governments to expedite the second phase of the fund, noting that several regions had failed to meet the June deadline. Haluk dismissed regulatory or human resource issues as “classic excuses,” warning that delays could harm public services such as healthcare and education.

By early September, the central government reported that 26 local governments at the provincial, regency, or city levels had failed to complete necessary administrative paperwork. To address these delays, the central government eased requirements for the second phase. Local governments are now permitted to proceed with a minimum of 50 percent realization of the first phase budget, provided they submit performance reports, output achievements, and documentation regarding previous funds and infrastructure additions. Haluk noted that reporting should be straightforward if regional programs follow original plans.

Concurrently, the Papua Provincial Government is urging faster absorption of the state budget (APBN), specifically regarding capital expenditures and goods and services spending. While employee spending has reached an average realization of approximately 65 percent, capital and contractual spending remain delayed. Officials noted that disbursement is tied to field progress, requiring third parties to expedite work. Meanwhile, budget efficiency pressures and reduced funding have impacted public works, prompting inspections of Mobile Training Units across Papua and Maluku to prevent asset deterioration during periods of inactivity.