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JAKARTA (TheInsiderStories) – Indonesian finance ministry established the Environmental Fund Management Body which is expected to optimize the process of managing environmental funds, including reforestation funds, as well as guaranteeing environmental protection and management programs, the ministry has announced on Sunday (10/06).

The agency is regulated through Finance Minister Regulation PMK No.137/PMK.01/2019, which is the mandate of Government Regulation No.46/2017 concerning Environmental Economic Instruments and Presidential Regulation No.77/2018 concerning Management of Environmental Funds.

“The existence of the agency can accelerate the operation of public service assistance for forest development financing that has been running in the past three years. Currently, there is no scheme for sharing the percentage of funds channeled for forestry and environmental recovery,” said the secretary-general of the environment and forestry ministry, Bambang Hendroyono, yesterday.

“At least, there is a transition period of 3 months related to budget adjustments. As initial capital, the agency’s operations are supported by Public Service Assistance funds, whose investments are obtained through reforestation funds worth Rp2 trillion (US$141.84 million). While running, the agency will also accommodate grants from abroad,” he added.

Judging from the regulation, the non-echelon organizational unit is tasked with carrying out environmental fund management in various fields, including in the fields of forestry, energy and mineral resources, carbon trading, and others.

In carrying out its duties, the agency also has five functions, namely first, carrying out the preparation of a strategic plan. Among these are business strategic plans, annual business plans, and budgets, as well as work plans and work unit budgets.

In this function, they are also tasked with managing the budget, accounting, and also doing financial reporting. The agency will also deal with human resource management, public affairs, housekeeping, public relations, and information services.

In addition, they are also tasked with managing the technical information system and the Environmental Fund database and coordinating the implementation of tasks.

Second, to arrange, implement, supervise, and report related to funding. The agency also mobilizes funding sources, develops investments, and also settles the Environmental Fund. In this function, the agency must also establish cooperation with funding sources such as custodian banks, commercial banks, and other parties.

Third, formulate and implement a fund distribution plan. This includes determining the object for channeling funds, supervising and evaluating the distribution of funds, and providing guidance to recipients of funds. Its also function to convey accountability through the delivery of the results of the analysis to the ministries or institutions, custodian banks, commercial banks, and other related parties.

Fourth, study the legal aspects of rules and agreements and those relating to laws and regulations. In this case, they are also required to document all legal texts, regulations, and agreements, and carry out risk management. Fifth, conduct an internal inspection of the implementation of the tasks of the agency.

The agency will be chaired by the president director with equipment consisting of the director of finance, general and information systems; director of fund collection and development; director of fund distribution; director of law and risk management; and internal audit unit.

Then, in carrying out its duties and functions, the agency must have an effective and efficient working relationship system between internal organizational units and related agencies. It said the agency is subordinate to and responsible to the minister of finance through the director-general of the treasury.


Written by Lexy Nantu, Email: