Due to lower-than-expected revenue collection, the Ministry of Finance has begun trimming the third installment of Financial Equalization Grants allocated to provincial and local governments. With only 81.75% of the revenue target achieved in the first half of the fiscal year, the Financial Comptroller General Office has been instructed to release just 20.43% of the scheduled 25% installment. This effectively reduces cumulative transfers by mid-quarter from 75% to 70.43%. Although Rs 38.187 billion has already been disbursed to provinces, local officials warn that mid-year cuts disrupt development projects and annual planning.
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