Financial Risk:
Moderate
Score:
53/100
Asset Disposals
Q24
75/100
How effective are controls over the disposal of assets, and is information on these disposals, and the proceeds of their sale, transparent?
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The disposal of assets is regulated in Minister of Defence Regulation No. 18/2017 [1], which was issued in compliance with Minister of Finance Regulation…
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The disposal of state property other than land and/or buildings in the Ministry of Defence and Indonesian National Defence Forces can be completed in…
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Property users that conduct disposal of assets must submit a report to the manager of the goods, i.e. the Ministry of Finance, no later…
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Q25
25/100
Is independent and transparent scrutiny of asset disposals conducted by defence establishments, and are the reports of such scrutiny publicly available?
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Minister of Defence Regulation No. 18/2017 stipulates the procedures for the implementation, monitoring and evaluation of the removal of goods, including weapons systems, in…
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This indciator is marked ‘Not Enough Information’ as information regarding the removal or destruction of state property will be recorded in the official report…
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No audit reports on the disposal or removal of weapons are accessible to the public. A search on the internet only found news about…
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Secret Budgets
Q26
NA/100
What percentage of defence and security expenditure in the budget year is dedicated to spending on secret items relating to national security and the intelligence services?
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This indicator is marked ‘Not Enough Information’ because it is not possible to calculate this percentage. In principle, there are no secret items because…
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Q27
25/100
Is the legislature (or the appropriate legislative committee or members of the legislature) given full information for the budget year on the spending of all secret items relating to national security and military intelligence?
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In theory, parliament must be provided with information regarding spending on secret items, but this information is only presented in aggregate form. This limitation…
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Q28
50/100
Are audit reports of the annual accounts of the security sector (the military and intelligence services) subject to parliamentary debate?
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The BPK presents the results of the audit of the central government’s financial report to the DPR at the plenary session in May [1].…
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Parliament follows up on BPK audit findings by asking the government to report on the implementation of the BPK recommendations. The BPK report examines…
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Q29
100/100
In law, are off-budget military expenditures permitted, and if so, are they exceptional occurrences that are well-controlled? In practice, are there any off-budget military expenditures? If so, does evidence suggest this involves illicit economic activity?
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Article 25 of Law No. 3/2002 concerning National Defence and Article 66 of Law No. 34/2004 concerning the Indonesian National Defence Forces stipulate that…
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This indicator is marked ‘Not Applicable’ as there is no off-budget military expenditure (see 29A)
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Interviewees stated that the term ‘off-budget’ no longer existed after the Reformation era because all budgets have to be administered or accounted for [1].…
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Q30
50/100
Are mechanisms for accessing information from the defence sector effective?
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There are a number of regulations governing the obligations and limitations of the Ministry of Defence, as a public body, related to providing information…
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This indicator is not scored in the GDI. In general, information is divided into two categories: information that must be provided and announced and…
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Law No. 14/2008 concerning Openness of Public Information regulates the existence of the Information Commission (KIP), an independent institution that implements this law, establishes…
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Q31
63/100
Do national defence and security institutions have beneficial ownership of commercial businesses? If so, how transparent are details of the operations and finances of such businesses?
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In the past, TNI business activities have been carried out without any government control or supervision. Military business was claimed to have contributed to…
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Law No. 25/1992 concerning Cooperatives stipulates that financial statements must be submitted to the management of the cooperative through the annual members’ meeting (Rapat…
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Military-owned Businesses
Q32
25/100
Are military-owned businesses subject to transparent independent scrutiny at a recognised international standard?
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There is no information confirming whether the audits of financial statements of cooperatives, including TNI business, are carried out by independent auditors. Yayasan Adi…
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The audit result regarding the financial condition of cooperatives is said to have been discussed during the annual members’ meeting (RAT) [1], but it…
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Illegal Private Enterprise
Q33
NEI/100
Is there evidence of unauthorised private enterprise by military or other defence ministry employees? If so, what is the government’s reaction to such enterprise?
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Since the Reformation, the TNI has been banned from engaging in business activities, either in an institutional or private capacity, through Law No. 34/2004…
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There is insufficient evidence to score this indicator; as such, it has been marked ‘Not Enough Information’. An interview with the former Chief of…
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Actual Military Spending
Q77
69/100
Is comprehensive data on actual spending on defence published during the budget year?
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Reports on actual spending can be found in the Central Government Financial Report (Laporan Keuangan Pemerintah Pusat/LKPP), which is published by the Ministry of…
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In the LKPP, data on actual spending is presented in aggregate form and organised by ministry and function [1]. There are no specific financial…
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The Central Government Financial Report (LKPP) is published by the Ministry of Finance [1] in April or May of the following year [2].
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The LKPP presents comparisons of various budgets with actual spending in aggregate form (central government) and by function (there are 11 functions including defence)…
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