<![CDATA[The constitutional mandate of Article 31 of the 1945 Constitution of the Republic of Indonesia drives the government’s political and legal commitment to implement a policy of gradually waiving tuition fees at public universities. However, the full transfer of operational funding from the State Budget (APBN) creates a conflict of norms with the legal framework of State Universities as Legal Entities (PTN-BH), which were designed to be autonomous under Law No. 12 of 2012. This normative legal study aims to analyze the legal implications of full State Budget funding on the degree of autonomy of State Universities with Legal Entity Status (PTN-BH), to rationalize the legal status of the wealth and assets of PTN-BH in relation to the State Property regime and Law No. 17 of 2003, and to formulate an ideal reconstruction of the financial governance of PTN-BH. This study employs a legislative, conceptual, and comparative approach to the higher education systems in Germany and Sweden. The results indicate that massive intervention by the State Budget without legal restructuring risks triggering fiscal recentralization, which would reduce the managerial flexibility of PTN-BHs, effectively turning them into ordinary bureaucratic units. Furthermore, the uncertainty regarding the demarcation between Separated State Assets and State Property has the potential to lead to the criminalization of the rectorate’s financial discretion. This study recommends restructuring governance through a Performance-Based Block Grant scheme that separates the accounting of public funds from the university’s independent funds. This scheme should be formalized through a new Government Regulation or an amendment to the Statutes of each PTN-BH, and supported by performance audit standards from the State Audit Agency to ensure legal certainty and university autonomy.]]>
