Improvement of Effectiveness of Village Fund Policy in Indonesia

Abstract: After the legalization of the Village Law, the amount of funds flowing into villages is geting higher and higher. Every year it continues to increase. In 2015 the amount reached Rp. 20.8 trillion, and in 2016 it was Rp. 46.96 trillion, and now it raised to Rp. 60 trillion, and in 2018 it would be increased to Rp 120 trillion. The greater authority of the village government to manage the finances and resources is not balanced with the controls in the use of the budget. Automatically, it results in the arising of some problems. Supervision and monitoring are very important things to do so that earlier detection can be carried out if there are some irregularities, dissipations, misappropriations, obstacles, and mistakes in the use of funds, also failures to achieve the goals and objectives. They are done in stages involving various stakeholders such as the community, the regional government, the ministries, Audit Board, and the Corruption Eradication Commission; House of Representaties or Parliament, Regional People’s Representative Assembly, and Village Consultative Body (BPD) (Regional Planning Agency) politically have a function of supervision of the village officials in managing the village funds. It can be started from empowering the local communities to participate in the management of the village funds to reporting the implementation of the planning of the programs. Involving the local people is highly expected that the village funds are used as optimally as possible based on the interests and needs of the local community.