Aceh – Indonesia, The central government has allocated a budget of IDR 23 trillion in the 2027 State Budget (APBN) to cover the salary and honorarium needs of government employees with work agreements (PPPK) in regional governments. This policy aims to reduce the burden of personnel expenditures previously borne by regional budgets (APBD).
Chairman of the House Budget Committee (Banggar DPR RI) Said Abdullah stated that the PPPK employees funded by the central government largely work in the education and health sectors. The transfer of funding responsibilities was among the agreements reached between the government and Banggar during the 2027 APBN deliberations.
“The central government will cover the salary or honorarium needs of government employees with work agreements (PPPK) working within regional governments, who are mostly regional educators and healthcare workers,” Said said during a DPR RI plenary meeting at the parliamentary complex, Senayan, Jakarta, Tuesday (29/9/2026).
According to Said, the government allocated IDR 23 trillion for these requirements. The budget is expected to ease personnel expenditure pressures on regional governments.
“We have budgeted IDR 23 trillion in the 2027 Draft State Budget (RAPBN). This allocation will lessen the burden of personnel budget needs for regional governments,” he said.
This policy is also linked to regional transfers (TKD) in 2027, which have been set at IDR 735 trillion. This TKD allocation marks an increase from the 2026 outlook of IDR 696.9 trillion.
The government is directing TKD funds to support essential regional expenditures, public services, and to maintain the fiscal capacity of local governments.
By having a portion of PPPK salary needs covered by the central government, regional budgets are expected to gain greater fiscal room to finance other development needs.
In addition to shifting the PPPK burden, the government and Banggar also agreed to postpone the full implementation of regional mandatory spending provisions. Said stated that this policy was adopted to safeguard the fiscal space of regional governments.
Law Number 1 of 2022 on Financial Relations between the Central Government and Regional Governments stipulates that regional personnel spending shall not exceed 30% of total APBD expenditure, excluding teacher allowances allocated through TKD.
Regional governments are also required to allocate at least 40% of APBD spending to public service infrastructure.
“Based on an evaluation of these mandates, we agreed to grant a delay in enforcing mandatory spending so that regional fiscal space can be preserved,” Said stated.
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