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PRACTICAL GUIDELINESfor

Analyzing Public Expenditureat the Sub-National Level

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The WORLD BANK OFFICE JAKARTAIndonesia Stock Exchange Building, Tower II/12-13th Fl.Jl. Jend. Sudirman Kav. 52-53Jakarta 12910Tel: (6221) 5299-3000Fax: (6221) 5299-3111

The WORLD BANKThe World Bank1818 H Street N.W.Washington, D.C. 20433 USATel: (202) 458-1876Fax: (202) 522-1557/1560Email : [email protected] : www.worldbank.org

Printed in May 2010

Table of Contents

Glossary of Terms iiChapter 1. Introducing Public Expenditure Analysis 11.1 What is Public Expenditure Analysis (PEA)? 11.2 Why is the PEA useful? 11.3 Who will use the PEA? 21.4 What is included in the PEA? 2

Chapter 2. Doing a Public Expenditure Analysis 52.1 Writing the research proposal 52.2 Collecting the data 52.3 Entering the data into a formal that is useful for analysis 62.4 Analyzing the data, formulating conclusions and recommendations 62.5 Writing the report 6

Chapter 3. Research Proposal 7

Chapter 4. Data Collection and Preparation for Analysis 94.1 Collecting data 94.2 Preparing the data for analysis 10

Chapter 5. Data Analysis, Conclusions and Recommendations 135.1 Overview chapter 135.2 Planning and budgeting chapter 205.3 Revenue chapter 215.4 Expenditure chapter 325.5 Strategic sectors 39

Chapter 6. Writing the PEA Report 436.1 Know your audience 436.2 Common mistakes in report writing 436.3 Consistent format, clear structure 446.4 Writing the PEA report as a team 456.5 Further references 456.6 Extra tips : some lessons learned 45

APPENDICESAppendix 1: PEA Standard Outline 47Appendix 2: Data Requirements 65

ii Practical Guidelines for Analyzing Public Expenditureat the Sub-National Level

Glossary

APBD Regional Government Budget (Anggaran Pendapatan dan Belanja Daerah)APBN State Budget (Anggaran Pendapatan Belanja Nasional) Bappeda Regional Development Planning Agency (Badan Perencanaan Pembangunan Daerah)Bappenas National Development Planning Agency (Badan Perencanaan Pembangunan Nasional)Bawasda Regional Monitoring Agency (Badan Pengawasan Daerah)

BKD Regional Civil Service Agency (Badan Kepegawaian Daerah)BKN State Civil Service Agency (Badan Kepegawaian Negara) BMT Budget Master Table BPHTB Land and building transfer fee (Bea Perolehan Hak atas Tanah dan Bangunan)BPS Central Bureau of Statistics (Badan Pusat Statistik) BPS-SK Financial statistics from Central Bureau of Statistics (Statistik Keuangan Badan Pusat Statistik)Bupati District Head CPI Consumer Price IndexCSO Civil Society Organization DAK Special Allocation Fund (Dana Alokasi Khusus)D&L Damage and LossDAU General Allocation Fund (Dana Alokasi Umum)Desa VillageDinas Local Technical Agency OfficeDPRD Provincial House of Representatives (regional parliament) (Dewan Perwakilan Rakyat Daerah)GDP Gross Domestic ProductGER Gross Enrollment RateGoI Government of IndonesiaGRDP Gross Regional Domestic ProductHDI Human Development IndexKabupaten District (regency)Kecamatan SubdistrictKelurahan Urban villageKepmen Ministerial Decree (Keputusan Menteri)Keppres Presidential Decision (Keputusan Presiden)Km KilometerKota City (urban district)LG Local GovernmentMDG Millennium Development GoalMoF Ministry of FinanceMoHA Ministry of Home AffairsMoNE Ministry of National EducationMSS Minimum Service StandardNGO Non-Governmental OrganizationNR Natural Resources O&M Operations and MaintenancePAD Own-Source Revenue (Pendapatan Asli Daerah)PBB Land and Building Tax (Pajak Bumi dan Bangunan)PDAM Local Water Supply Utility (Perusahaan Daerah Air Minum)Perpu Regulation in Lieu of Law (Peraturan Pemerintah Penggati Undang-Undang)Perda Regional Regulation (Peraturan Daerah)

iiiPractical Guidelines for Analyzing Public Expenditureat the Sub-National Level

PFM Public Financial Management Podes BPS Village Potential Survey (Potensi Desa)Polindes Village Maternity Center (Pos Persalinan Desa)Puskesmas Community Health Center at Sub-district Level (Pusat Kesehatan Masyarakat)Posyandu Integrated Health Service Unit (Pusat Pelayanan Terpadu)Pustu Sub-community Health Center (Puskesmas Pembantu)Regional Budget Consolidated Budget consisting of Central Government Budget (Deconcentrated), Provincial Budget and District Budget.Renstra Ministry/Agency Medium-Term Strategic Plan (Rencana Strategis) RGDP Regional GDPRKPD Regional Government Work Plan (Rencana Kerja Pemerintah Daerah)RPJMD Regional Medium-Term Development Plan (rencana Pembangunan Jangka Menengah Daerah) Sakernas Labor Force Survey (Survei Tenaga Kerja Nasional) SDO Subsidy for Autonomous Region (Subsidi untuk Daerah Otonom)SIKD Regional Finance Information System (Sistem Informasi Keuangan Daerah)SKPD Regional Government’s Working Unit (Satuan Kerja Pemerintah Daerah)SME Small/Medium EnterpriseSTR Student Teacher RatioSub-National Budget Consolidated Budget consisting of Provincial and District Budgets, but excluding Central Government.Susenas BPS National Socio-Economic Survey (Survei Sosial Ekonomi Nasional)TKD Regional Performance Bonus (Tunjangan Kinerja Daerah)WB World Bank

1Practical Guidelines for Analyzing Public Expenditureat the Sub-National Level

Chapter 1Introducing Public Expenditure Analysis


1.1 What is Public Expenditure Analysis (PEA)Public expenditure analysis (or PEA) is a method of analyzing how governments allocate and manage their financial resources. The purpose of doing the analysis is to provide recommendations on how governments can manage public finances more efficiently and effectively in the future.

1.2 Why is the PEA useful?All governments have limited resources. This means there is a need to carefully decide how those financial resources will be allocated in order to achieve the maximum public benefits. However, in order to make these decisions, governments need accurate and timely information and analysis in order to answer key questions, such as:

1. How much money does the government have to spend? Where does the revenue come from? What is the potential, if any, for increasing the government’s financing envelope?

2. What has the government spent its resources on previously?3. What sort of public services have been provided with the current budget? Which sectors have good

service provision and which sectors need improvement?4. Who are the main beneficiaries of government spending? For example, is it the rich or the poor? Women

or men? Rural or urban areas? Are the benefits spread evenly? Do the beneficiaries have equal access to services? Are there disadvantaged strata of the population who need special attention?

5. Have the services provided resulted in better human development outcomes for the population? For instance, have literacy rates, education levels, morbidity rates, life expectancy etc. improved?

6. How effective is the current planning and budgeting framework and process? Is the budget approved on time? Are the funds available in a timely manner? Are the planning priorities reflected in the budget?

7. What is the capacity of the civil service in public financial management? Are there areas that could be improved? If so, through what means could improvements be made?

The answers to questions such as these will help governments to identify priorities that need to be tackled through government spending and help them make informed decisions on how best to allocate funds.

1.3 Who will use the PEA?Many widely differing groups of people will find PEA of use:

Local Government (executive branch)The executive branch of the government, as the party responsible for initially setting the development priorities and allocating budget to meet development objectives, can use the analysis to help it in the allocating process. If

2 Practical Guidelines for Analyzing Public Expenditureat the Sub-National Level


the PEA is conducted on a regular basis (e.g. annually or every two years), it can also be used as a monitoring tool to evaluate whether development targets have been met. The PEA report also identifies capacity development needs, providing a platform for various programs to support local governments.

Local Government (legislative branch)The legislature is responsible for approving both the medium-term expenditure plan (RPJMD) and the budget (APBD). Therefore, it needs analysis to help in the evaluation of the submitted budget, especially to establish whether it is in accordance with the development objectives and priorities identified in the RPJMD. The PEA can also serve as a monitoring tool for the legislature in evaluating the performance of the executive. .

Central GovernmentThe PEA report provides a foundation for the central government (GoI) to observe how local governments have spent their money and the extent to which local governments have implemented regulations and followed guidelines laid down in the regional finance and autonomy sectors.

LobbyistsIndividuals and organizations (for example, CBOs and CSOs) with specific interests and advocacy aims can use the PEA to help them in their advocacy and lobbying work. Advocacy policies are developed based on sound analytical work and the PEA serve as one source for this analytical work.

Researchers and AcademicsResearchers can also use the PEA methodology as a framework for their own research. It is a method for analyzing how governments allocate their resources and can supplement their existing research. PEA reports can also be used as an information source for researchers and students interested in sub-national public finance issues.

Other Donors and Local Government ProgramsOther donors and local government programs can use the capacity development needs identified in the PEA report as a basis to assist them in developing their own programs.

Private SectorEntities from the private sector already with investments, or interested in investing in a certain province or kabupaten/kota, can use the PEA to increase their knowledge of the locality. The PEA is a source of general information on economic structure, sources of revenue, the local government’s spending priorities, and public service delivery successes and challenges. The PEA also reflects local government’s capacity, as well as the level of transparency in its activities.

PublicPublishing a PEA is one important way for governments to be transparent with regard to their use of public resources. A PEA presents financial information compiled from long and often complex budget documents in a format that is far easy to understand. Furthermore, a PEA contains a clear analysis of spending trends that the public can then use to hold politicians and governments accountable for their promises and responsibilities.

1.4 What is included in the PEA?PEA is a dynamic methodology that should be regularly revised to meet the needs of the users (section 1.3). However, as a minimum, any PEA should include all of the following:

Chapter 1: OverviewThis chapter should introduce the reader to the geographic area researched. It should include information about its history, geography, population, government structure, economic structure and trends on important macroeconomic indicators, such as poverty level, growth rate, employment levels, human development index (HDI) and minimum service standards (MSS).



Chapter 2: Planning and BudgetingThis chapter should provide the reader with an overview of the planning and budgeting process at the national level and how the regional level contributes to the national framework. The analysis should include analysis on whether the sub-national government is following the national framework. Furthermore, the chapter should establish the level of consistency between planning documents (RPJMD, Renstra, RKPD etc) and whether the priorities set in those planning documents are reflected in the budget.

Chapter 3: Revenue The purpose of this chapter is to provide a comprehensive picture of revenue at the sub-national level. This includes calculating the total revenue envelope, including an analysis of revenue-source trends. For example, does the sub-national government derive its revenue predominantly from own-sourced revenue (PAD) or transfers from central government? This chapter also includes calculations of the deficits and surpluses of the sub-national government, and its financing policy. Finally, this chapter includes analysis of how the sub-national government records its revenue and financing, and whether there are discrepancies.

Chapter 4: Expenditure The purpose of this chapter is to provide a comprehensive picture of expenditure at the sub-national level. This includes calculating total expenditure and analyzing spending trends across time, sector, economic classification and by which level of government (province, kabupaten/kota or central governments). This chapter also looks at ability of the sub-government to absorb its budget by analyzing realization rates. The purpose of this chapter is to provide recommendations on how governments can improve the effectiveness and efficiency of public spending.

Chapter 5: Strategic Sectors: Education, Health and Infrastructure The purpose of this chapter is to provide sharper analysis of those sectors most important for public service delivery: health, education and infrastructure. For each of these three sectors, this chapter analyzes spending and compares it with what the spending has achieved, both in terms of outputs such as staff, buildings and services, and also whether the spending has achieved an improvement in outcomes. For example, has health spending increased? If so, has this resulted in improved services (access, quality etc) and, if better services have been delivered, has this resulted in lower illness or mortality rates. Recommendations from this analysis may include identifying priority areas of health or education that the government should target, or how the government can improve its spending within a specific sector (e.g. more funds should be allocated to maintaining existing infrastructure rather than building new infrastructure).

Attached in Appendix 1 is the PEA Minimum Standard Outline that provides the key chapters, sections and questions that all PEAs must include.


Chapter 2Doing a Public Expenditure Analysis


The following briefly describes the main steps in conducting a PEA:

2.1 Writing the Research ProposalBefore starting any research activities, it is important to have a comprehensive research proposal. The purpose of the research proposal is to set out what the research will be about, why it is important, who will do it, who are the target audiences, and the timing and scope of the research. This preparatory step is important in avoiding undertaking irrelevant work and, if working in a team, ensuring that there is a common understanding between team members. This step is important because defining the scope of research also defines the scope of data that will need to be collected. Chapter 3 provides further guidance on writing a research proposal.

2.2 Collecting the DataOnce the proposal is completed, the researcher (or research team) can start the data collection. This is one of the most crucial stages of the research, as the quality of research is directly correlated to data quality. There are four important characteristics of data quality: data should be detailed, comparable, accurate and timely.

The more detailed the data the better the analysis. If data are very broad and general, the researcher will experience difficulties in finding explanations for trends and drawing conclusions. In order to make comparisons across time, or with different kabupaten/kota, the data used must be comparable. For example, if the expenditure in the agriculture sector for kabupaten 1 includes fisheries but does not include fisheries in kabupaten 2, this means the agriculture information is not comparable unless the fisheries information is removed from kabupaten 1. It is important that the researcher examine the data carefully to ensure that they are comparable. Accuracy of data is also important, although this may not always be within the control of the researcher and may depend on the methodology used by those who responsible for primary data collection (e.g. BPS). For example, there are often many different versions of the APBD (pre-audit, post-audit, etc) and it is important that the data used are the most accurate available. There are two aspects to whether data are timely: first, conclusions on public finance can only be based on data from multiple years. A general rule of thumb is that data must be collected over a minimum of five years. The longer timeframe the data are available the better the analysis and its conclusions. Furthermore, in order for the research to be relevant, the most recent data are required.

Gaining access to financial information is not always a smooth process and the researcher will need to be creative in finding different ways of ensuring that data collected are complete. Furthermore, the researcher may find inconsistent data from difference sources and will need to make judgments on which source is more appropriate (based on the principles of detailed, comparable, accurate and timely). Chapter 4, Section 4.1 will provide further guidance on the process of data collection.



2.3 Entering the data into a format that is useful for analysisRaw data (for example, found in the APBD or RPJMD) are often in a format unsuitable for analysis. Some common problems include: a) the data are only available in hardcopy; b) the data are not comparable because the budget format has changed; and c) the sectoral and economic classifications vary between governments. Therefore, in order to ensure consistency in the usage of data across the analysis, it is essential that data are entered into a format that allows the information to be compared and analyzed. This may include entering the information into a common table. This manual includes a suggested master table that all budget information should be entered into prior to analysis. Chapter 4, Section 4.2 provides further guidance on entering data into a format that is useful for analysis.

2.4 Analyzing the data, formulating conclusions and recommendationsOnce data collection has been completed and the data entered into one location and format, the researcher(s) are ready to conduct the analysis. While Chapter 5 sets out a variety of methodologies needed to analyze the data in order to write a PEA report, below are some broad suggested steps for conducting the data analysis:

(a) Based on the available data, what trends can be seen? Has the indicator remained steady, increased or decreased?

(b) Why has the trend happened? Is there a reason for the trend? Components (a) and (b) form the conclusion of the analysis?

(c) Based on the reason explaining the trend, is there something that the government can do to improve the situation? This becomes the recommendations.

Overall, the hallmark of good analysis is that the trends, conclusions and recommendations are linked to each other, and that these in turn stem from the available data. Further guidance on analyzing data is found in Chapter 5

2.5 Writing the reportBased on the analysis and conclusions drawn in Step 4, the researcher(s) will consolidate the most important research and messages into a final written report. While strong analysis based on quality data is essential for the integrity and validity of the conclusions and recommendations, a well-written concise report is the medium by which the main messages are delivered to its audience. There are several characteristics to a well-written report: a) It has a clear and consistent structure. This manual has provided a general structure (see Section 1.4) that which most PEA reports to date have followed. While researchers should be free to add additional relevant material in order to make comparisons with other PEA research, this manual recommends that researchers remain faithful to the overall structure; b) all content included in the PEA report is relevant to its overall message; and c) sentences should be concise and free of jargon. Chapter 6 provides further guidance on writing a PEA report.


Chapter 3Research Proposal


Before starting data collection or conducting any analysis, it is important to have a comprehensive research proposal. The purpose of the research proposal is to set out what the research will be about, why it is important, who will do it, who are the target audiences, and the timing and scope of the research. This preparatory step is important in avoiding undertaking irrelevant work and, if working in a team, ensuring that there is a common understanding between team members. As a minimum, a PEA research proposal needs to cover the following:

Background: What circumstances have led to the need for a PEA? Has anyone asked for the PEA? If so, who?

Purpose of research: Outline what the PEA is trying to achieve. As mentioned in section 1, the main purpose of the PEA is to provide recommendations to government on how budgets can be allocated more effectively. Are there supplementary goals that the PEA is trying to achieve? For example, is it trying to build the capacity of team members to work in a team? Is it trying to collect budget and planning documents for university libraries or a database?

Key audience: Identify who this research is primarily intended to reach and how the audience(s) is expected to use the research.

Scope of research: This should include identifying the key research questions that need to be answered; an agreed time frame that this research will cover (e.g. years and data needed); geographic scope of the research (e.g. how many kabupaten/kota will the PEA cover?); content scope of research (e.g. type of data required); an overview of the report structure, although this may change over time depending on the data collected and analysis conducted so the structure should remain flexible; and discuss generally the type of conclusions and recommendations expected.

Timing: Provide a Gantt chart on the timing of the research, including key milestones (data collection completed, first draft completed etc).

Research team – roles and responsibilities: This section will describe the research team composition and expected roles of team members. This section is not relevant if there will only be one researcher. Some suggested roles include:

Team Leader: Responsible for ensuring that all team members understand their respective roles and responsibilities and are working as a team towards reaching a common goal.



Some tasks include:- Ensuring that the research proposal is complete and agreed upon by the team and related parties.- Overseeing the timely completion of tasks by each member of the research team. - Requesting (in reality, chasing) team members to submit their analysis and written material. - Compiling and collating each chapter written by different team members. - Editing all written materials. This task includes editing for consistency, style of language, structure/flow and

logical progression between chapters, sections and sub-sections, and between sentences throughout the entire report.

Researcher: This person will be responsible for conducting the portion of the research assigned to him/her by the team leader. This includes collecting data, analyzing the data and writing the relevant sections or chapters of the report. The researcher should also ensure that her/his work is consistent with the rest of the team, so that when the team puts together the final draft, the analysis is of similar structure, content and quality. The proposal should assign specific responsibilities to each researcher.

Research Assistant: the researcher may choose to take on a research assistant to help her/him with any aspects of the research.

The number of senior researchers and research assistants needed for a PEA team depends on the scope of research (time frame, geography etc).


Chapter 4Data Collection and Preparation for Analysis


4.1 Collecting data The purpose of this section is to explain to the researcher the data collection steps (what needs to be collected and from which sources), what issues the researcher may encounter and how these issues may be overcome.

4.1.1 Data requirementsIn order to complete a PEA, both quantitative and qualitative data are required. As discussed in Chapter 2, the more detailed and complete the data the better the analysis will be. For a full list of minimum data requirements, refer to Appendix 2. This section will provide a general overview of the data needed and their sources.

Quantitative data:• Fiscal data: Data include APBN, APBD, DAU, DAK, borrowing, local taxes, revenue-sharing, and PAD. • Non-fiscal data: Data include population data; poverty rates; employment rates; education indicators such as

the number of schools, teachers, students; enrollment rates; health indicators such as the number of staff and health centers; infrastructure indicators such as the length of roads, water and sanitation facilities available; the composition of DPRD; and the composition of civil servants.

Qualitative data:• Planning process: Are the pre-requisite plans in place? Is planning participatory? How are the plans monitored?• Budgeting process: What is the level of public participation in the budgeting process? Is quantitative

information used to make budget decisions? How are budget decisions made in specific sectors? Is the budget made available to the public? Which unit is responsible for disbursement? Has a local treasury been established? What are the payment mechanisms? Has performance budgeting been introduced? How is budget performance monitored?

• Transfers: How many installment transfers does the local government receive from the central government and how timely are they?

Data sources:Data may be collected from a variety of sources (and these may be inconsistent), but below is a suggested list of sources:

• Ministry of Finance• Central Bureau of Statistics (BPS)• Ministries of Public Works, Health and Education• State Civil Servant Agency (Badan Kepegawaian Negara, or BKN)• Provincial governments (Finance Agency, Planning Agency, Health Agency, Education Agency, Public Works

Agency)• Relevant agencies of the kabupaten/kota governments• World Bank and United Nations

For a full list of minimum data requirements and sources, refer to Appendix 2.



4.1.2 Data collection issuesDuring the process of collecting data from government agencies and other sources, the researcher may encounter many obstacles. This section outlines some common issues faced by researchers and suggests some solutions in overcoming those issues. This is not an exhaustive list of the potential issues and it will ultimately be up to researchers to find their own solutions.

1. No access to data. Researchers will often encounter obstacles in gaining access to data. Even where the provincial government has provided the requisite authorization papers, researchers will eventually run into sub-national government or agencies that are reluctant to make documents available.

Suggested solution 1: Discuss the issue with the researchers’ contacts in the government or donor agencies (if they are financing your research). For example, if the research is part of a larger donor-funded program, the program may have a program management committee or similar with representatives of the government sitting on this committee. This committee or related donor agencies (such as the World Bank) may be able to provide additional papers directly addressed to the particular government/agency reluctant to provide data access.

Suggested solution 2: If solution 1 does not work, ask the researchers’ contacts in the government or donors to intervene directly. For example, the program management committee or related donor may be able to contact the government agency directly themselves. They may be able to gain access to higher authorities at that particular region or, if possible, a representative of the committee may be able to accompany the researcher to the government agency themselves.

Suggested solution 3: Find other sources for that particular data. Options include using close substitutes as proxies or using similar data from central (Jakarta) sources.

2. Data from different sourcesData may be collected from sources that are inconsistent (i.e. showing different numbers) and it is possible that the data may differ significantly. For instance, the population data from sub-national BPS and Bappeda often contain large variations.

Suggested solution: Gather more information on the different data, especially on the definitions, objectives, how the data are collected and the data availability. Based on these considerations the researcher can then decide which data are more accurate and relevant.

4.2 Preparing the data for analysisThis section will discuss important aspects of preparing the data for analysis. First, this involves deciding on data characteristics prior to commencing analysis. In particular, it will discuss why it is important to reach agreement on the data and the analysis. Second, this chapter will explain the data table, what it aims to do and how to fill it out.

4.2.1 Agreeing on data sources, scope and analysisThe aim of agreeing on data sources is to use a consistent data set throughout the analysis. This is especially important in cases where analysis in different sections is carried out by different researchers. The following issues need to be agreed:



Source of data: central government versus sub-national governmentsData can come from two sources: central government or sub-national governments. For example, the Ministry of Finance keeps sub-national government fiscal data in a database called the Sistem Informasi Keuangan Daerah (SIKD) and is more easily accessible through the SIKD web site. If the researchers are from the regions, they may have direct access to the fiscal data from sub-national governments. There are advantages and disadvantages from both sources.

The advantage of central government sourced data is that the data are available for all regions and therefore comparable across provinces (and across kabupaten/kota). However, since the data are manually entered into the SIKD, they may be subject to human input error. Alternatively, data collected directly from sub-national governments may be more accurate. However, if the researcher has access to post-audited reports these may also contain more detailed information. If this information is available, it can be used for intra-regional comparisons (e.g. between provincial and kabupaten/kota governments within the same province) but should not be used for inter-regional analysis (e.g. between provinces or between kabupaten/kota in different provinces). This difference between central government and sub-national government sources applies to fiscal data, as well as some other quantitative output and outcome indicators. The research team needs to agree which set of data will be used in the entire PEA analysis.

Source of population data:Population data are available from many sources ranging from the central BPS, regional BPS (provincial capitals) and different agencies within sub-national governments. Agreement on the data used is important because these data will generate per capita figures. As discussed in 3.1.3, where inconsistencies exist between different data sources it is for the researcher to decide which data set to use based on information concerning methodology, data availability, the definition of the data set etc.

Time span:As discussed in the proposal stage, the time span for analysis needs to be agreed upon from the outset. As discussed in Chapter 1, the longer the time span, the better the analysis. However, there are significant limitations in data availability. For example, provinces established after decentralization, will not have data prior to 2000. Ideally, the minimum time span is five years. Also, where possible, the same years should be used for all data. One limitation is that the most recent years for outcome indicators (Susenas, Sakernas, health and education indicators) are often not available, so they may be of different time spans to the fiscal data (when more recent data are readily available). This is a limitation, but it remains important that the PEA analysis uses at least five years of data.

Consumer Price Index (CPI):The research team needs to agree on the CPI because all nominal fiscal data must be converted to real figures (i.e. constant price figures) to take into account inflation. If the regional CPI is unavailable, agreement must be reached on which CPI figure to use as a proxy. Furthermore, researchers must agree on the base year for the real figures. Usually, the base year is the earliest (or oldest) year in the dataset. However, in order for the analysis to be forward looking, the authors recommend that researchers use the latest (i.e. most recent) year as the base year. The advantage of doing so is that when comparing trend figures and cross-section figures (which are the latest) the numbers will be consistent and comparable. This has proved to be most effective when the report is written by a team of researchers who work independently most of the time.

4.2.2 The Budget Master Table (BMT)Once agreement has been reached on data sources, the CPI and the time span, and the data collection has been completed, the next step is to input the data into a format that makes it accessible for analysis. As discussed in the research proposal section, the data must be comparable. Therefore, the raw data must be re-formatted so that the figures are comparable across years, geographic areas, sectors and economic classifications. There are two significant limitations in comparability. First, budget formats have changed several times during the past decade. Second, different governments may structure their government departments in different ways. For example, the scope of responsibilities for the Public Works Dinas may differ between districts.



To help researchers re-structure the fiscal data into a comparable format, this manual is accompanied by a CD containing an Excel file called the “Budget Master Table” (hereafter referred to as the BMT). The BMT uses a format into which all fiscal data should be entered prior to any analysis. The objective of the BMT is to consolidate all sub-national governments’ budget information into one location in a clear and consistent format, irrespective of different economic or sectoral classifications. Having all fiscal data in one source is particularly crucial if research is conducted by a team, as it will ensure that different researchers will use consistent figures in their respective analyses.

The BMT Excel spreadsheet consists of four sections:1. Read me: This section provides all the information regarding the data used in the BMT. This section also

provides population and regional CPI data that is used to generate real and per capita figures.2. Regional budget: This section covers the budgets from the provincial government and all the kabupaten/kota

within the province. It covers the planned and realization figures for the time span agreed upon. 3. Central budget/deconcentrated spending: This section covers the central spending (deconcentrated funds)

allocated to the province. Due to data limitations, the available data are usually the realization figures and broken down by sector.

4. Consolidated figures: This section provides the consolidated budget figures in nominal, real, and per capita forms.

The BMT is created by manually entering the data from the collected budget reports from the sub-national government. Each cell consists of relevant items from the budget reports. At some point, assumptions/estimates can be made to any information that does not have a direct relation to the budget report. For example, if we convert prices into real prices, there should be a clear reference to which inflation factor has been used and which year is the base year. The important point is to document any assumptions or estimates so that this information is kept for future reference.

Documents in CD: Example of Master table (see master_gPEA_final.xls), Exercise (see master_gPEA_exercise.xls)


Chapter 5Data Analysis, Conclusions and Recommendations


This chapter discusses what types of analysis are required to write the PEA report. This includes identifying which charts are useful for each chapter and explaining which data are required to conduct the analysis and create the graphs. It also considers the types of conclusion that can be drawn from the analysis. This chapter is broken down into sections based on the minimum chapters expected in a PEA report, which include:

1. Overview • Regional economic analysis • Regional demographic analysis • Poverty analysis

2. Planning and budgeting • Development priorities analysis • Planning and budgeting linkages • Good practice for planning and budgeting • Participative development planning and budgeting • Regulatory framework analysis

3. Revenue • Overall revenue picture • Detailed revenue analysis • Financing analysis

4. Expenditure • Overall spending picture • Sectoral spending analysis • Economic Classification Analysis • Local spending variation analysis • Central government spending analysis

5. Strategic Sectors (education, health and infrastructure) • Analysis of spending by strategic sectors • Performance analysis for each strategic sector



5.1 Overview chapter5.1.1 ObjectiveThe objective of this chapter in the PEA is to provide a general demographic background of the province, with a focus on social and economic analyses. If the researchers and/or sub-national government raise issues that are specific to the province (considered “local issues”) then these should also be introduced in this chapter.

5.1.2 Type of analysisIn this section, the following topics would usually be discussed:

1. Regional economic analysisa. Economic growthb. Structure of the economyc. Inflation

2. Regional demographic analysis a. Population and employment structureb. Unemployment

3. Poverty analysis a. Poverty ratesb. Human Development Index

4. Regional economic analysisThe regional economic analysis should look at the general macroeconomic conditions of the province, particularly in comparison with other provinces and the overall Indonesian position. There are three main elements to the economic analysis: economic growth, structure of the economy and inflation.

a. Economic growth (regional gross domestic product (RGDP) growth, RGDP per capita).The objective is to understand the size of the provincial/district economy as well as the rate at which the sub national economy has grown, especially in comparison to other provinces, districts in Indonesia and with the national average. Source of data: Regional Statistical Office and the Regional Planning Agency.

Example 1: making provincial comparisonThe next bar graph is an example of how the size of the regional economy can be presented. It shows per capita RGDP at the Gorontalo province, in comparison with the other provinces in Sulawesi, in eastern Indonesia and across Indonesia. The graph suggests two trends: 1) Gorontalo has a very small economy, as measured by the per capita RGDP, compared to other provinces in Indonesia; and 2) While the Gorontalo economy has grown between 2000-2006, this follows a general trend across Indonesia. Per capita real RGDP is the preferred indicator because when using total RGDP the population is excluded, yet it contributes to the making of RGDP.



Figure 1. Economic growth in Gorontalo, comparison with provincial and national level, 2000-2005

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The above line graph shows the real economic growth, as measured by change in RGDP of Gorontalo between 1994 and 2005, compared to other provinces. The graph suggests that until 2005 Gorontalo grew faster than the average of other provinces in Sulawesi, eastern Indonesia and nationally. In 2005, however, eastern Indonesia’s growth rate suddenly rose to over nine percent (up from less than one percent in 2004), and overtook Gorontalo province’s growth rate.



Further issues to investigate:The key next step after identifying trends is to investigate why these trends may have happened. Some typical follow-up questions might include:

• What has been causing the per capita RGDP to increase in Gorontalo and generally across all provinces in Indonesia?

• What are drivers of Gorontalo’s economic growth?• Why did eastern Indonesian provinces suddenly experience such significant growth in 2005?

b. Structure of the economy (sectoral RGDP, sectoral per capita RGDP)The purpose is to analyze which sectors drive the sub-national (provincial or distric / city) economy. This analysis can compare one province/distric/city across time or compare against different sub-national governments. Source of data: Regional Statistics Agency and Planning Agency.

Example 2: sectoral contributionsThe example in Figure 2 shows which sectors contribute to the sub-national economy. The pie graph below shows that agriculture represents the largest sector for Nias Islands (consisting of two districs), followed by trade, restaurants and hotels. The Islands have very little activity in the manufacturing, mining and electricity, gas and water sectors (combined 4.5 percent).

Figure 2. Sectoral composition for GRDP in Nias islands, 2005

Trade,Restaurant, &

Hotel22.1%

Transport & Communication

6.9%

Financial Services5.5%

Mining and Quarrying

2.3%

Electricity,Gas, & Water

0.4%

Construction7.9%

ManufacturingIndustry

1.8%

Agriculture43.0%

Services10.1%

Figure 3 shows the per capita RGDP of Gorontalo between 2000 and 2005, in comparison to real wages. The graph shows several trends: 1)

(i) Agriculture forms a significant portion of Gorontalo’s per capita RGDP throughout all years.(ii) The overall sectoral composition of RGDP has remained fairly consistent although the percentage of RGDP

from electricity, water and gas has increased.(iii) Although per capita RGDP has increased, real wages have decreased in 2005 and 2006.



Figure 3. Sectoral composition for GRDP per capita in Gorontalo, 2000 -2006

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Further questions for consideration:Some typical follow-up questions might include:

• Why have real wages decreased?• Why have the electricity, gas and water sector increased?

d. Inflation The objective is to provide an overall picture on inflation levels in the sub-national region. Inflation levels can be compared across years, between districts / cities, between provinces or with regional / national figures.

Figure 4 Inflation rate for Gorontalo, comparison with provincial and national level, 2004-2007

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Figure 4 provides one example of how inflation analysis can be presented. The graph suggests several trends:(i) Overall, inflation in Gorontalo has followed the trends for the rest of the country. (ii) Although consistent with the rest of Indonesia, Gorontalo seems to experience more extreme highs and

lows, as shown by the sharp spikes in the line graph. (iii) Since mid-2007, inflation in Gorontalo has been lower than the rest of Indonesia.

Further questions for consideration:Some typical follow-up questions might include:• Why does Gorontalo experience more extreme highs and lows in inflation rate?• Is there a reason why inflation changes in Indonesia more strongly affects Gorontalo?• What drives the price movement in Gorontalo (food, service sector, construction material, etc)?

5. Regional demographic analysis The purpose of the regional demographic analysis is to look at the population and employment conditions, with a focus on the following issues:

a. Population and employment structure The purpose of this analysis is to determine which are the key sectors that absorb employment and analyze the education level of those employed. This analysis can compare districts / cities, as well as with provincial and national figures. Source of data: Regional Statistical Office and the Regional Planning Agency.

Example 3: employment analysisFigure 5 shows which sectors contribute the most jobs in Gorontalo between 2001 and 2006. The graph shows two notable trends: 1) the majority of jobs in Gorontalo are in the agricultural sector; and 2) although still by far the largest driver of employment, the proportion of jobs in the agricultural sector has decreased from 63 percent in

2001 to 55 percent in 2006.

Figure 5. Employment at the sectoral level in Gorontalo, 2001-2006

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• Is the decrease in the proportion of agricultural workforce significant?• If so, what caused this decrease?• What sectors have grown in terms of size of workforce?• Why have those sectors increased?

b. Unemployment ratesThe purpose of this analysis is to evaluate the sub-national unemployment rate with other comparisons such as the national average, rates in other similar provinces and/or to other districts / cities. Sources of data include the Regional Statistical Office and the Regional Planning Agency.

Example 4: unemployment rates in GorontaloFigure 6 compares Gorontalo’s unemployment rate to the national level and the average for the provinces in eastern Indonesia. The graph suggests two trends:

(i) Between 2001 and 2006, unemployment in Gorontalo decreased although unemployment in both eastern Indonesian and Indonesia-wide increased.

(ii) Unemployment in Gorontalo experienced much larger fluctuations between years than compared to eastern Indonesian and Indonesia.

Figure 6 . Unemployment level in Gorontalo, comparison with national level, 2001-2006

National Gorontalo EasternIndonesia

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• Why has unemployment decreased in Gorontalo while the overall trend in both eastern Indonesia and Indonesia has increased?

• Why does the Gorontalo’s unemployment rate fluctuate so much between years?

6. Poverty analysis a. Poverty RateThis analysis should investigate poverty trends over time, and compared to other provinces / districts / cities and the national poverty levels. The purpose of this analysis is to determine whether poverty levels in the province / district / city has increased or decreased during the years analyzed. Furthermore, it is important to determine whether trends identified in the province / district / city are consistent with trends in other provinces or in comparison with the poverty level in Indonesia. Source of data: Regional Statistical Office.



b. Human Development IndexThis analysis looks at poverty trends over time, and compared to other provinces / districts / cities and the national poverty levels. The purpose of this analysis is to determine whether Human Development Indicators (HDI) in the province / district / city has increased or decreased during the years analyzed. Furthermore, it is important to determine whether the trend in the province / district / city is consistent with trends in other provinces or in comparison with the HDI trends in Indonesia. Analysis in HDI could also incorporate the drivers of HDI (life expectancy, literacy rate, mean years in schooling, or per capita income) in the respective provinces; therefore a breakdown of data could add more insight in this analysis. Source of data: UNDP Human Development Report.

Example 5: poverty rates and the human development indexTable 1 shows how both poverty and HDI levels can be presented. The poverty rate in the table suggests several trends: 1) the poverty rate in Gorontalo province is 28.9 percent, which is much higher than the national poverty rate of 16.7 percent; 2) HDI level in Gorontalo is similar to the national HDI.

Table 1 Poverty rate and HDI in Gorontalo, comparison with national levelIndicator Gorontalo National

Highest Lowest Average Highest Lowest Average

GRDP per capita (Rp million, 2005) 5.2 2.8 3.7 407.3 0.9 12.6

Poverty rate (2004, %) 32.5 10.8 28.9 51.0 2.9 16.7

Adult literacy rate (2006, %) 83.1 60.0 70.8 99.3 7.3 71.5

Secondary net enrollment rate (2006, %) 67.9 39.3 46.2 90.4 8.2 57.8

HDI (2005) 70.4 65.9 67.5 77.4 46.9 69.6


• Has the poverty and HDI levels in Gorontalo changed over the years?• Has it increased or decreased?• If changed, what are some factors that caused that change?• Has the change in poverty and HDI levels changed over years?• Is the trend consistent with the national, or eastern Indonesia trends?

If there is a difference, it is important to explain why there is a difference.

5.2 Planning and budgeting chapter5.2.1 ObjectiveThe aim of this chapter in the PEA is to better understand regional development planning and the relationship to the budgeting process. The basic documents required to conduct the analysis are mainly budget documents (APBD) that can be obtained from budget offices and planning documents from relevant Bappeda offices.

5.2.2 Types of analysis requiredIn this section, the following topics would usually be discussed:1. Development priorities analysis 2. Planning and budgeting linkages3. Good practice for planning and budgeting 4. Participative development planning and budgeting5. Regulatory framework analysis



1. Development priorities analysis In order to describe provincial development priorities, this section requires a discussion of the priority sectors mentioned in the provincial RPJMD (Regional Medium-Term Development Plan), a brief description of main function (urusan wajib) and optional function (urusan pilihan) of sub-national governments, as well as an assessment of the level of linkages and synchronization between various planning documents.

2. Planning and budgeting linkagesThis section looks at the function of the budget as a tool of development planning and how it is used in establishing development priorities. It assesses whether the existing budget (APBD) is really linked to the planning documents and whether the budget contains the development goals as stated in the planning documents.

3. Good practice for planning and budgeting This section reviews whether the existing planning and budgeting documents have taken into account Medium-Term Expenditure Framework (MTEF) and Performance-Based Budgeting (PBB) principles. It aims to establish how well the concepts of MTEF and PBB are applied in the current budget system.

4. Participative development planning and budgetingHere, we look at how well the region has applied a participative process in development planning, the benefits and drawbacks of using such process.

5. Regulatory framework analysisThis section examines whether the process of planning and budgeting has been conducted according to existing regulations and has occurred within the required timeframe.

5.3 Revenue chapter5.3.1 ObjectiveThe aim of this chapter is to understand the total financing envelope that is available to the region and the sources of that revenue, including the extent to which this comes from national or local governments. As such, the required figures are consolidated from all relevant districts / cities, the provincial government and Central government (deconcentrated funds and other assistance (tugas pembantuan)). The basic documents required to conduct the analysis are mainly budget documents (APBD) obtained from the budget offices or Bappeda.

5.3.2 Types of analysis requiredIn this section, the following topics would usually be discussed in order to provide a comprehensive analysis of sub-national revenue:

1. Overall revenue pictureThe purpose of this analysis is to provide a consolidated picture of the general revenue trends in the province. This analysis must include revenue data from both the provincial and district / city governments.

2. Detailed revenue analysisThe second section provides a more detailed analysis of the main sources of revenue (DAU, DAK, Shared Revenue and own-source revenue (PAD)). This includes for each type of revenue: trends over time, whether derived by provincial or district / city governments; and what factors cause each type of revenue to increase or decrease.

3. Financing analysisThis section aims to understand the level of surplus/deficit that the sub-national government has; and how the provincial / district / city government(s) finances the deficit or allocates the surplus; as well as how the accounts are recorded in the APBD.



5.3.3 Overall revenue pictureThe purpose of this analysis is to provide an overall picture of how much consolidated revenue the region receives. Part of this general analysis is to compare the province’s consolidated revenue with other comparable provinces in Indonesia, and with the Indonesian average. Key aspects of this analysis should include:

• Trends over time: has total revenue increased or decreased over time? Why? How does the trend com-pare to other provinces in Indonesia or the Indonesian average? To compare with other provinces, the analysis must use per capita figures.

• Level of government: which level of government receives the sub-national revenue? Provincial govern-ment or district / city governments? Has this changed over time?

• Distribution across districts / cities: which district / city receives the highest levels of revenue? Which receives the lowest level of revenue? Why? To compare between districts / cities, the analysis must use per capita figures.

• Composition of revenue: what are the main sources of revenue – DAU, DAK, Shared Revenue, PAD? Has the composition of revenue changed over time?

Example 6: trends across time

Figure 7 is an example of a time series graph that shows the revenue trends across time in Gorontalo.

Figure 7. Fiscal resources per capita in Gorontalo, 1998-2006

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Own Source RevenueShared Nat Resources(Development) Presidential Grants/INPRESDAKOther Revenue

1999 2000 2001 2002 2003 2004 2005 2006*

Shared TaxesAutonomous Region Subsidy/SDODAUOther Balancing Fund

Rp ’0

00

The graph suggests several observable trends:(i) Since 2001, Gorontalo’s per capita revenue has increased steadily. (ii) Since 2001, the sources of revenue have changed significantly. The majority of the revenue is from fiscal

balancing funds, which comprises of DAU, DAK and Shared Revenue.(iii) The majority of the increase in revenue is from the balancing funds, which was the main tool used by

the central government to transfer fiscal management to local governments, as a part of Indonesia’s decentralization reforms.




• Why has per capita revenue increased?• Is the growth in Gorontalo’s revenue higher or lower than revenue growth in other provinces in Indone-

sia? Why might this be?• What recommendations might help sub-national governments to increase revenue?

Example 7: composition of revenue

Table 2. Fiscal revenue composition in Gorontalo and consolidated districts, 2002-20062002 2003 2004 2005 2006*

Province Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %

DAU 157.05 81 210.55 79 231.71 82 211.01 78 340.80 89

Own-Source Revenue 31.08 16 41.94 16 41.59 15 46.11 17 40.70 11

Shared Tax Revenue 6.04 3 7.23 3 7.58 3 12.99 5 3.57 1

DAK 0.00 0 5.61 2 0.00 0 0.00 0 0.00 0

Shared Natural Resource Revenue 0.46 0 0.32 0 0.72 0 0.08 0 0.00 0

Other Revenue 0.00 0 0.25 0 0.00 0 0.04 0 0.00 0

Total 194.63 100 265.90 100 281.60 100 270.24 100 385.07 100

2002 2003 2004 2005 2006*

Districts/Cities Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %

DAU 478.46 82 558.80 78 559.96 74 569.46 72 825.53 77

DAK 13.66 2 26.94 4 48.60 6 56.74 7 103.00 10

Own-Source Revenue 31.13 5 48.70 7 49.32 6 45.91 6 52.80 5

Shared Tax Revenue 37.53 6 29.76 4 53.55 7 57.29 7 57.92 5

Shared Tax and Assistance from Province 0.00 0 10.40 1 11.88 2 12.17 2 11.01 1

Other Revenue 11.37 2 24.05 3 23.14 3 34.48 4 14.58 1

Shared Natural Resource Revenue 3.57 1 1.85 0 3.26 0 3.59 0 3.19 0

Adjustment Fund 4.26 1 20.31 3 12.08 2 10.90 1 0.00 0

Total 579.98 100 720.80 100 761.80 100 790.53 100 1,068.04 100

Table 2 presents revenue in Gorontalo by year and by composition, and separated between the provincial Government and its district / city governments. The table shows several observable trends:

(i) Between 2002 and 2006, provincial revenue and district / city revenue almost doubled.(ii) The vast majority of the revenue at both the provincial and district / city level, is from DAU.(iii) At the district / city level, DAK has increased by almost 600 percent from 2002 to 2006.(iv) Very little revenue is from PAD, which means the province predominantly relies on transfers from central

government.




• Why has the above trends happened?• How does revenue growth in Gorontalo compare with other provincial / district / city governments in

Indonesia?• What factors affect the increase in DAK and DAU?• Are these factors different in Gorontalo compared to other local governments in Indonesia?

Example 8: revenue composition by district / city

Figure 8. Fiscal revenue composition in Gorontalo and individual districts, 2005

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Gorontalo Bone Bolango Boalemo Pohuwato Kota Gorontalo

Own Source Revenue Shared Tax RevenueShared Natural Resource Revenue DAUDAK Shared Tax Revenue and Assistance from Prov.Adjustment Fund Other Revenue

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The above graph compares the revenue composition in the district / city governments in Gorontalo. The graph suggests several trends:

(i) All district / city governments in Gorontalo derive most of their revenue from DAU.(ii) Several districts, including Bone Bolango, Baolemo and Pohuwato, received significant DAK transfers

compared with the remaining two districts.(iii) Kota Gorontalo has the highest level of PAD.


• Why did the three districts receive higher levels of DAK compared to Kota Gorontalo or Kabupaten Gorontalo?

• Why does Kota Gorontalo has such a high level of PAD compared to the districts in Gorontalo?

Example 9: comparison with other sub-national governmentsFigure 9 compares the per capita consolidated sub-national revenue in Gorontalo with other provinces in Indonesia. The other provinces selected are all provinces that were established in 1999, as part of Indonesia’s decentralization reforms. The graph shows that Gorontalo’s fiscal capacity is one of the weakest, amongst the newly-established provinces.



Figure 9. Comparison of fiscal revenue resources of Gorontalo sub-national governments with other regions, 2005

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Further questions for consideration:A typical follow-up question might be:

• Why is Gorontalo’s per capita revenue lower than other newly-established provinces?

5.3.4 Detailed revenue analysisThe purpose of this section is to analyze in more detail each source of revenue and how each type impacts on the overall revenue levels in the province. Regional governments derive revenue from three main sources:

a. Own-source revenue (Pendapatan Asli Daerah) (PAD)This is revenue collected by sub-national governments and may include local taxes, fees and investment income.

b. Balancing funds These funds are used by the central government to balance the fiscal capacities of sub-national governments:

(i) Dana Alokasi Umum (DAU) or general allocation is a discretionary block grant transferred from the National government to all sub-national governments to achieve fiscal equality. DAU is allocated using a national formula based on factors such as population, regional area, per capita gross regional domestic product (RGDP), Human Development Index, civil servant salary budget and spending, the level of own-source revenue (PAD) and shared revenue (bagi hasil).

(ii) Dana Alokasi Khusus (DAK) or special allocation is an earmarked cash grant transferred from the central government to sub-national governments to finance specific needs of the region.

(iii) Bagi Hasil or shared revenue (from tax and natural resources) is revenue generated from taxes (national level) and natural sources that are shared between central government and the sub-national governments based on an agreed ratio found in legislation.

d. Other revenuesThese include grant revenue, contingency funds, special autonomy funds (for example in Aceh and Papua), and other sharing revenue/financial assistance from other provincial or district governments.



For each type of revenue, this section should also examine the following issues:• Trends over time: has total revenue increased or decreased over time? Why might this be? How does the

trend compare to other provinces in Indonesia or the Indonesian average? To compare with other prov-inces, the analysis must use per capita figures.

• Level of government: which level of government receives the sub-national revenue? Provincial govern-ment or district / city governments? Has this changed over time?

• Distribution across district / city: which district / city receives the highest levels of revenue? Which receives the lowest level of revenue? Why is there a difference? To compare between district / city, the analysis must use per capita figures.

• Planned v realized revenues: did the sub-national government realized the revenue it had planned to collect?

• Composition of revenue: for each type of revenue, what are the main factors that cause the increase or decrease of that revenue? How does the trend compare to other provinces in Indonesia?

Example 10: revenue trends over time

Figure 10. Trend of DAU per capita in Gorontalo, 2006

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The above is a simple way of showing the growth in DAU in Gorontalo between 2002 and 2006. The graph suggests that although the DAU grew slightly between 2002 and 2005, the most significant increase occurred in 2006.


• What factors caused the significant increase in 2006?• How does this increase compare to other provinces in Indonesia?

Example 11: revenue trends across districts / citiesFigure 11 shows how the DAU was distributed across districts in Gorontalo relative to their fiscal gaps-per-capita and civil service wage bills.



Figure 11. Distribution of DAU per capita in Gorontalo sub-national governments, relative to fiscal gap and wage bill

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This figure suggests that the DAU allocation seems to be correlated with the size of a district’s wage bill. However, in some cases (for example, Kabupaten Pohuwato) the fiscal gap component compensates for a low wage bill. Fiscal gap is the difference between the expenditure needs of the district and the fiscal capacity of the district.


• What are the factors that influence the size of the fiscal gap? For example, in Gorontalo, the fiscal gap in Kabupten Pohuwato is high because the district government provides services to a large land area; and because the cost of construction is high.

Example 12: DAK allocation by sectorFigure 12 shows the sectoral focus on DAK allocations. It suggests that in 2006, the majority of DAK was allocated to education, health and roads.

Figure 12. DAK allocations by sector in Gorontalo, 2006

Education23%

Health23%

Government4%

Agriculture10%

Fisheries5%

Roads24%

Water supply and sanitation

5%

Irrigation5%

Environment1%




• What was the DAK used to finance (eg classrooms, health facilities, training, road infrastructure)?

One or two examples of DAK activities from district or provincial government should be provided.

Example 13: planned vs realized revenue

Table 3. Realization rate of shared revenue, Gorontalo, 2002-05 2002 2003 2004 2005

Province

Shared tax revenue 132.24 111.76 109.88 249.36

Shared natural-resource (non-tax) revenue 33.34 23.94 82.69 n.a.

Districts/Cities

Shared tax revenue 121.94 116.03 103.98 89.61

Shared natural-resource (non-tax) revenue 84.75 60.96 151.06 247.78

The above table shows that Gorontalo exceeded its expectations and collected more shared tax revenue than expected, but generally did not meet expectations on non-tax shared revenue (natural resources). However, in 2004 and 2005, the district / city governments collected significantly more non-tax shared revenue than planned.


• Why were some estimates of planned revenue under-estimated and others over-estimated?

Example 14: composition of own-source revenue

Table 4. Own-source revenue composition, Gorontalo, 2002-20062002 2003 2004 2005 2006*

Province Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %Tax 23.84 77 29.29 70 33.45 80 37.41 81 37.48 92User charges 1.04 3 5.46 13 1.50 4 2.80 6 0.00 0Profit from reg-owned enterprises 0.00 0 0.18 0 0.28 1 0.29 1 1.00 2

Other own-source revenue 6.20 20 7.01 17 6.37 15 5.61 12 2.22 5Total own-source revenue 31.08 100 41.94 100 41.59 100 46.11 100 40.70 100

2002 2003 2004 2005 2006*Districts/Cities Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %Tax 4.82 15 6.36 13 7.88 16 7.31 16 7.34 15User charges 15.24 49 17.67 36 29.75 60 26.44 58 26.86 55Profit from reg-owned enterprises 0.35 1 1.14 2 2.12 4 3.48 8 3.02 6

Other own-source revenue 10.71 34 23.53 48 9.57 19 8.67 19 11.23 23Total own-source revenue 31.13 100 48.70 100 49.32 100 45.91 100 48.45 100



The above table, showing the composition of own-source revenue, suggests several trends:(i) Between 2002 and 2006, own-source revenue increased slightly, but still only represents a very small

percentage of total sub-national revenue.(ii) The provincial government collects a similar amount of own-source revenue as the district / city

governments. (iii) At the province level, the majority of own-source revenue is derived from taxes. In contrast, at the district

/ city level, over half of the own source revenue is from user charges.


• What has caused the slight increase in PAD? How does the growth in PAD in this province compare to other provinces in Indonesia?

• Why are the majority of taxes collected by the province, not the district / city governments? What is the legal basis for collecting those taxes? Can the tax collection be improved by becoming more efficient or effective?

• What taxes/user charges are most commonly found in the province?• What types of services are the district / city governments providing in which they are collecting revenue?

How can the district / city government increase its own-source revenue?

Example 15: comparison of PAD across districts and cities

Figure 13. Own-source revenue per capita, district comparison, Gorontalo, 2005

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Bone Bolango Gorontalo Boalemo Pohuwato Province Kota Gorontalo

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The above graph shows the level of own-source revenue collected by the sub-national governments in Gorontalo and suggests that Kota Gorontalo has a significantly higher level of PAD than other districts and the provincial government.


• Why is PAD highest in Kota Gorontalo?

An explanation should be provided, such as: This may be because Kota Gorontalo is a city with a larger population and more economic activity than its rural districts, from which the government can impose user charges for a variety of services such as health services, rubbish collection, registration of motor vehicles, renting space in markets etc.



Example 16: comparison of taxes and user charges between districts

Table 5. Taxes and user charges, district level, Gorontalo, 2005Kota Gorontalo Boalemo Taxes Rp million % Taxes Rp million % Street lighting tax 2,526.77 69.31 Street lighting tax 291.30 50.62 Hotel and restaurant tax 500.67 13.73 Tax on mining of c-class materials 175.33 30.47 Billboard tax 341.17 9.36 Billboard tax 51.60 8.97 Tax on mining of c-class materials 216.23 5.93 Hotel and restaurant tax 37.99 6.60Total Tax 3,645.79 Total Tax 575.43 User Charges Rp million % User Charges Rp million % Health 12,085.41 73.17 Administrative services 257.93 29.9 Building permits 1,154.23 6.99 Use of region’s assets 257.07 29.8 Use of region’s assets 572.24 3.46 Health 149.59 17.3 Jasa Pemberi Pekerjaan 401.77 2.43 Market 102.61 11.9 Market 354.03 2.14 Building permits 95.76 11.1Total User Charges 16,516.43 Total User Charges 1,670.73

Table 5 provides an example of the different components of taxes and user charges in Kota Gorontalo and Kabupaten Baolemo. It suggests several conclusions:

(i) Kota Gorontalo and Kabupaten Baolemo’s taxes and user charges are consistent with the taxes and user charges listed in Law No. 34/2000.

(ii) Entertainment taxes and parking fees are generally among the highest taxes and user charges, particularly in urban areas. However, this is not the case in Kota Gorontalo.


• Why are entertainment taxes and parking fees not the main form of taxes and user charges collected by the district / city governments?

A possible explanation: such taxes and user charges are less viable given that businesses and tourism remain relatively under-developed in Gorontalo and the number of cars is still limited. Only as the economy grows will opportunities increase for Kota Gorontalo to mobilize more significant own-source revenue.



Example 17: planned vs realized revenue

Table 6. Own-source revenue comparisons, provincial and consolidated districts comparison, Gorontalo, 2002-2005 Percent realization rateProvince 2002 2003 2004 2005Tax 116.30 86.42 96.79 99.40

User charges 115.46 69.45 87.35 103.58

Profit from reg-owned enterprises 0.00 131.99 85.21 98.53Other own-source revenue 89.19 148.05 67.47 128.53Total own-source revenue 109.63 89.95 90.35 102.47

Districts/Cities 2002 2003 2004 2005Tax 105.14 100.55 105.58 105.00User charges 99.16 92.80 95.38 102.78Profit from reg-owned enterprises 56.38 165.53 58.25 35.19Other own-source revenue 102.33 126.21 73.99 58.63Total own-source revenue 100.25 108.95 89.30 81.97

Table 6 shows whether planned own-source revenue is similar to the revenue levels actually realized by the sub-national governments. It suggests two trends:

(i) There was no clear pattern in own-source revenue realization over the period between 2002 and 2005. An over-realization in one year is often followed by an under-realization in the following year. For example, the profits from locally owned enterprises and “other” own-source revenue in 2003 and 2004, both at the provincial and district / city levels fell significantly in the years after.

(ii) Tax collection, however, was generally carried out as planned. With the exception of provincial tax collection in 2003, tax collection by the province and district / city diverged from planned amounts by less than 10 percent. Districts recorded a better realization rate than the province for user charges.


• What is the method for estimating own-source revenue? Can this methodology be improved to ensure more accurate planning?

5.3.5 Financing AnalysisThis section aims to understand the level of surplus/deficit that the sub-national government has; and how the province / district / city government(s) finances the deficit or allocates the surplus; as well as how the accounts are recorded in the APBD.

Example 18: provincial financial performanceFigure 14 shows whether the provincial / district / city governments in Gorontalo posted deficits or surpluses, and we can see that the governments consistently posted surpluses between 2002 and 2005.



Figure 14. Surpluses and deficits, comparison among sub-national governments, Gorontalo, 2002-2005

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15

2002 2003 2004 2005

Province Kota Gorontalo Bone Bolango Kab. Gorontalo Pohuwato Boalemo

% o

f tot

al e

xpen

ditu

re


• What does the district / city generally do with the surplus? For example, does it invest the surplus or ac-cumulate it in the reserves?

Example 19: reporting of carryoversTable 7 shows the data reported in the financing section of the APBD as stipulated in Kepmendagri No. 29/2002.

Table 7 Carry-overs, comparison among sub-national governments, Gorontalo, 2006

Province Kota Gorontalo Bone Bolango Kab.

Gorontalo Pohuwato

Carry-over to 2006 10.16 12.25 0.49 4.30 14.17

Carry-over budgeted in 2006 6.49 12.25 - 4.30 14.17

Difference 3.67 - 0.49 - -

The table shows that in general, financing reports are poorly documented and carry-overs are inconsistently reported. For example, carry-overs reported in one budget year are often inconsistent with carry-overs budgeted in the following year. This poor reporting not only creates errors in the budget plans for the following year, but also increases the risk of budget malfeasance.

5.4 Expenditure chapter5.4.1 ObjectiveThe aim of this chapter is to understand how sub-national governments spend their budgets, how expenditure trends across time, how much money each level of government (central, provincial, district / city) spends in the province, as well as how money is spent across different economic classifications and sectors. The required figures are consolidated from all relevant district / city, as well as the provincial figures.



The basic documents required to conduct the analysis are mainly budget documents (APBD) obtained from the budget offices or Bappeda.

5.4.2 Types of analysis requiredIn this section, the following topics would usually be discussed:

1. Overall spending picture 2. Sectoral spending analysis 3. Economic Classification Analysis 4. Local spending variation analysis5. Central government spending analysis

1. Overall spending picture This section aims to illustrate trends in total regional expenditure over time and how per capita regional expenditure varies across district / city, as well as comparing them with other provinces in Indonesia. An understanding of which level of government spends most money (central government, provincial or district / city) is also important.

Example 20: trends across time and between levels of government.Figure 15 shows the growth in expenditure in Gorontalo and to which level of government the funds are allocated.

Figure 15. Total spending, provincial level and consolidated districts, Gorontalo, 2002-2006

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Regional

expenditure (Rp bn)

Nat

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(Rp

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ion)

This figure suggests two trends:(i) Since 2002, expenditure in Gorontalo has increased significantly. Gorontalo’s sub-national spending,

which includes provincial and district level spending, has increased by more than 100 percent since 2002.(ii) The increase is more significant when central government deconcentrated spending is included in

consolidated regional spending. In the period between 2002 and 2006, deconcentrated spending grew almost tenfold and its contribution towards Gorontalo’s consolidated regional spending increased from 24 percent in 2002 to an estimated 60 percent in 2006.


• What has caused the growth in deconcentrated spending? Why is it preferred to other forms of inter-governmental transfers?

• Is the growth and dominance in deconcentrated spending in Gorontalo consistent with the trend in other provinces in Indonesia?



Example 21: provincial per capita comparisonsFigure 16 shows the per capita spending in Gorontalo compared to other provinces in Indonesia. It shows that expenditure in Gorontalo is below the national average, but is similar to other provinces in Sulawesi.

Figure 16. Consolidated total spending per capita by province, 2005

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Total Expenditure PC National Average

Per c

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00)

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• What factors causes certain provinces to have much higher per capita expenditure and other provinces much lower per capita expenditure, in comparison to Gorontalo?

2. Sectoral spending analysis This section looks at consolidated local spending categorized by sectoral classifications. The section should explain the current budget format, changes in the budget format and how spending is classified across a 5 to 6 year time span. Overall, the section should analyze the types of expenditure that dominate regional spending over time at the provincial and district levels. The focus of this analysis usually looks at four key sectors:

(i) government apparatus(ii) education(iii) health(iv) infrastructure

For the analysis of trends over time, constant price values are preferable.



Figure 17. Consolidated sectoral spending, Gorontalo, 2002-2006

82%

24%29% 32% 36%

37%6%

4%5%

5%

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OthersInfrastructureEducation

HealthAgricultureAdministration andapparatus

Sub-

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(Rp

bn)

Figure 17 shows consolidated sectoral spending (province, district and city) according to sectors. It shows several trends:

(i) The proportion spent on government administration and apparatus increased significantly from 24 percent in 2002 to 37 percent in 2006.

(ii) The proportion of total expenditure spent on education has decreased since 2002.(iii) The proportion of total expenditure spent on infrastructure has increased, while the proportion spent on

health has remained relatively constant.


• What are the factors that have caused the increases and decreased in spending in the respective sectors? For example, why does the Gorontalo government spend so much more on administration and appara-tus in 2006 compared to 2002?

• Why has the proportion of spending on education decreased?• How does Gorontalo’s sectoral spending composition compare to other provinces in Indonesia? For

example, do other provinces also spend more than one third of their expenditure on administration and apparatus?

• How can the sectoral spending mix be improved?

3. Economic Classification Analysis This section looks at consolidated local spending categorized by economic classifications. The section should explain the current budget format, changes in the budget format and how spending is classified across a 5- to 6-year time span. This section should also explain ways to address different budget format and what should be compromised in order to make time series comparison possible. Overall, the section should analyze the type of expenditure that dominates regional spending over time at the provincial and district levels. For trend analysis, constant price values are preferable.



Example 22: breakdowns of consolidated spendingTable 8 shows the spending mix according to economic classification.

Table 8. Provincial and districts consolidated spending based on economic classification, Gorontalo, 2002-2006

2002 2003 2004 2005 2006*

Province Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %

Personnel 15 8 51 20 81 30 66 26 91 23

Goods and services 14 7 36 14 43 16 51 20 130 33

Travel 4 2 17 7 22 8 27 11 0 0

Maintenance 2 1 4 2 6 2 8 3 0 0

Capital 121 64 111 44 74 28 70 28 115 29

Others 34 18 32 13 41 15 31 12 55 14

Total 190 100 251 100 267 100 252 100 391 100

2002 2003 2004 2005 2006*

Districts/Cities Rp bn % Rp bn % Rp bn % Rp bn % Rp bn %

Personnel 282 51 356 49 409 54 405 52 510 46

Goods and services 19 3 78 11 81 11 135 17 186 17

Travel 6 1 15 2 18 2 18 2 12 1

Maintenance 4 1 22 3 30 4 12 1 6 1

Capital 206 37 230 32 197 26 175 22 314 28

Others 36 7 22 3 25 3 40 5 88 8

Total 553 100 722 100 760 100 784 100 1,115 100

The table shows several observable trends:(i) At the province level, approximately one-third of total expenditure is spent on goods and services, with

another 29 percent on capital spending. Personnel spending consumes 23 percent of total provincial expenditure. The amount spent on capital spending has varied significantly between years, from nearly two-thirds in 2002, to below one-third in 2006, whilst spending on personnel has tripled over the same period.

(ii) At the district / city level, almost half of total expenditure is spent on personnel, twice that of the provincial government. The district / city governments spent a similar proportion on capital works, but only 17 percent of total expenditure on goods and services: half the proportional amount spent at the Province.


• Why has spending on personnel and goods and services increased so significantly at the provincial level? Is this trend due to an increase in the number civil service staff, salaries, or other associated costs?

• Why is such a large proportion of district / city expenditure spent on personnel expenditure? How does this level compare to other provinces in Indonesia?

• What sort of infrastructure has built from the capital expenditure? For example, have the funds been spent on government buildings, hospitals, schools, roads or bridges?



4. Local spending variation analysisIn this section comparisons across districts are analyzed. District-level comparison provides useful information on overall spending levels and the spending mix. For instance, this may cover the level of per capita spending, the level of capital expenditure, and the level of sectoral or economic classification spending. Some key questions to investigate further would include:

• which districts have the highest level of per capita spending? • which districts have the highest level of per capita education / health / infrastructure / personnel spend-

ing?

Where possible, use graphs to illustrate where there are differences, such as Figure 18 below.

Example 23: district expenditure comparisonsFigure 18 compares the per capita spending of the different districts and cities in Maluku province. It shows that the per capita expenditure in Kabupaten Maluku Tenggara Barat is twice the size of that in Kota Ambon.

Figure 18. Central government deconcentrated spending per capita by province, 2005

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Per Capita Expenditure Per Capita Revenue

Kab. M. Ten Bar

Kab. Kep. Aru

Kab. SBT Kab. SBB Kota Ambon

Kab. M. Tengah

Kab. BuruKab. M. Tenggara

Source: SIKD, MoF (2009)Note: Figures are World Bank estimates


• Why do certain districts have much higher per capita revenue than other districts and Kota Ambon?

A possible explanation: newly established district generally have higher levels of per capita revenue. This may be due to the costs required in establishing the government structure (personnel and infrastructure). Comparisons with other newly established district would then be useful.

5. Central government spending analysisIn this section an analysis of spending by the central government at the provincial / district / city level is conducted with a focus on three key sectors, namely health, education and infrastructure. Such spending includes deconcentrated and Tugas Pembantuan (TP) funds. To some degree, central government spending also requires some cost sharing or additional financing from the APBD, which should be explained.



Example 24: comparison with other Indonesian provincesFigure 19 shows that in comparison to other provinces, Gorontalo has received a relatively high level of deconcentrated spending from the central government.

Figure 19: Central government deconcentrated spending per capita by province, 2005

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ku

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atera


• Why did Gorontalo receive such a high level of deconcentrated spending?

Example 25: central government spending

Figure 20 Central government spending on decentralized sectors, province and districts, 2005

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Agriculture Health Administrationand apparatus

InfrastructurO thersE ducation

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Province District / City Deconcentrated Spending



Figure 20 shows the sectoral focus on deconcentrated funds, which suggests several trends:(i) Deconcentrated funds are rarely used for government administration and apparatus.(ii) Apart from administration and apparatus, deconcentrated funds are a dominant source of funds for all

other sectors, especially health and agriculture.


• How have deconcentrated funds been used? Have central government funds been used to build ad-ditional infrastructure, or to run new programs? What changes have there been as a result of central government spending?

• How does the central government decide on how to allocate deconcentrated funds?• When are general allocations funds (Dana Alokasi Umum (DAU)) used, rather than special allocation

funds (Dana Alokasi Khusus (DAK))• How does the central government identify initiatives suitable for deconcentrated funding?

5.5 Strategic sectors5.5.1 ObjectiveThe aim of this chapter is to look at more detailed spending in the three strategic sectors of education, health and infrastructure, as well as to gauge the available fiscal resources for each strategic sector. A discussion of performance indicators available at the local level is also conducted by linking them to existing trends in spending in the past 5 to 6 years. A comparison between districts and across provinces, as well as with national figures, will be useful in providing insights. The required figures are consolidated from all districts/ cities, as well as the provincial figures.The basic documents required to conduct the analysis are mainly budget and planning documents at the Dinas level.

5.5.2 Types of analysis requiredThe type of analysis required to write this chapter includes:

1. Breakdown analysis for each strategic sectors spendingThis section contains a detailed analysis of the strategic sectoral spending. This is achieved by looking at how much is spent within each sector according to economic classification, as well as according to major programs within the sector/Dinas.

Figure 21. Trends in sub-national education spending, Gorontalo, 2002-2005

266382 368

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%



Figure 21 shows that although total education spending has increased significantly, the proportion of total expenditure spent on education has actually decreased from 29 percent in 2002 to 25 percent in 2005.


• What types of programs did the increased budget focus on? For example, did the increased funding go towards improving the quality of teaching, or improving access to education, or improving literacy rates?

• How does the level of education spending in Gorontalo compare to other provinces in Indonesia?

Example 27: comparisons with other provincesFigure 22 shows Gorontalo’s sub-national education spending (district and provincial) in comparison with other provinces in Indonesia. Overall, education spending in Gorontalo is higher than average. This applies whether comparing education expenditure as a share of total spending or per capita spending.

Figure 22. Sub-national education spending per student enrolled in primary and secondary school by province, 2005

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l

In 2005, Gorontalo’s sub-national spending per school-aged student enrolled in primary and secondary schools was Rp 1.3 million per capita, Rp 311,000 higher than the national average of Rp 990,000. Meanwhile, Gorontalo’s district and provincial governments spent 27 percent of their total expenditure on education, 2 percentage points higher than the national average.

Example 28: availability of resources for educationTable 9 shows the total fiscal resources made available to the education sector by the different levels of government (district / city, province and central governments).



Table 9. Available fiscal resources for education, province + districts + deconcentrated, 2002-20052002 2003 2004 2005

Rp bn % Rp bn % Rp bn % Rp bn %

Province expenditure 6.3 2 14.1 4 11.7 3 13.9 2

District expenditure 191.2 72 257.1 67 264.9 72 252.9 39

Deconcentrated expenditure 68.9 26 110.8 29 91.0 25 387.3 59

Total regional education expenditure (2005 prices) 266.4 100 382.1 100 367.6 100 654.1 100

Nominal total regional education expenditures 218.9 326.8 334.3 654.1

Growth real total regional education expenditures 30.3 -3.9 43.8

Education expenditure (% of total regional) 28.80 26.43 25.22 24.64

This table suggested several trends:(i) Between 2002 and 2004, the majority of the education budget was spent by the district / city government.(i) In 2005, however, deconcentrated expenditure became the largest proportion of total education spending.(ii) Although education expenditure increased in 2003 (in real terms), it actually fell slightly in 2004 (3.9

percent) but increased significantly again in 2005 (43.8 percent).


• Why did deconcentrated expenditure increase so significantly in 2005? What was the change in govern-ment policy that precipitated this growth?

• Why did real education spending decrease in 2004 but increased in 2003 and 2005? Which factors caused this fluctuation in spending allocations? What new programs were added in 2003 and 2005 to merit the increase in expenditure?

Figure 23. Economic classification of education spending, Gorontalo, 2005

Districts/cities

1 % 11 %

2 %

86 %

Travel, maintenance,and otherCapital

Goods and services

Personnel

Province

Travel, maintenance,and otherCapital

Goods and services

Personnel

7 %

25 %

31 %

37 %



Figure 23 shows that the spending mix at district level differs to the education spending mix at the provincial level:(i) At the district level, all but 3 percent of total education expenditure is spent on either personnel or capital.

This suggests that the majority of funds are spent on teachers or infrastructure (such as schools). It also highlights that very little funding is spent on the maintenance of schools and classrooms.

(ii) In contrast, the provincial government spends a significant proportion of its education budget on goods and services and also a small portion on travel and maintenance.

Further questions for consideration:After analyzing APBD documents further, some typical follow-up questions might include:

• What types of personnel did the district government hire, and for what purpose?• How was capital works spending used, and how much of this was used on maintenance?• What are the identified priorities of the education sector in the province and does the budget allocation

reflect a focus on these priorities?

2. Performance analysis for each strategic sectorThis section contains comparisons between spending on strategic sectors over time (5 to 6 years ideally) with changes in performance indicators specifically identified for each sector. These can be based on inputs, outputs or outcomes. The following indicators are examples of those used in the education, health and infrastructure sectors:

Suggested indicators for education:• Educational attainment by year of birth • Access to public primary education by income group • Trends in net and gross enrollment rates for primary and secondary education• Student/teacher ratio, student/classroom ratio, average year of schooling

Suggested indicators for health:• Health services utilization • Public health facility utilization by income groups• Access to healthcare services by income group• Per capita monthly out-of-pocket health spending• Morbidity rate• Doctor/population ratio

Suggested indicators for infrastructure:• Irrigation coverage and access to road infrastructure• Access to safe water and electricity • Quality of sanitation, clean water and sanitation• Quality and quantity of road infrastructure

Each performance indicator may be analyzed according to improvements (or deteriorations) over time, comparisons between districts / cities / provinces, and comparisons with national averages.

Chapter 6


Chapter 6Writing the PEA Report


Based on experience, there are some common errors that many writers make. This chapter aims to provide some guidance on how writers can avoid those common mistakes.

6.1 Know your audienceIn writing a PEA report, not only is it important to remember that the report is intended to be read by a diverse audience, but also that the core audience consists of key policy-makers at the central and local levels. Policy-makers typically receive a great many reports, some of which may be very thick and filled with lengthy explanations. It is important to remember that the reader a) may not have time to read because of other time demands; b) may have many other tasks to complete; and c) may not have in-depth knowledge of the topic of the report or of technical jargon. We observe that many reports remain unread because they are too thick, contain overly complicated explanations, or because the material is not presented in an interesting format. A PEA report should avoid these shortcomings.

6.2 Common mistakes in report writing As mentioned above, PEA reports should avoid common shortcomings in government reports. To do so, here are some ways to avoid common mistakes:

Keep it short! PEA reports must be concise and to the point. Avoid repetition and complicated or roundabout language. Use precise, unambiguous terms.

Include a glossary: This is necessary to help those with a non-technical background to understand the acronyms and abbreviations that apppear in the text.

Avoid jargon and long sentences: Use simple, specific, precise sentences. Avoid particularly lengthy sentences. If the sentence is longer than three lines then it is too long. Use words that people without a finance or economics background will understand.

Only include relevant material: Analysis should be objective, relevant and specific.

Link paragraphs: Paragraphs should be logically ordered, and maintain a clear flow.

Keep to one idea per paragraph: Sentences in each paragraph should also be logically ordered and clearly inter-connected. A controlling idea for each paragraph will help to guide effective use of words and maintain a clear flow between sentences.

Use graphs and tables: A picture speaks a thousand words. Where possible, explain your analysis with a graph or a table

Reference clearly : If the materials from other sources are used, reference clearly. In addition to data from government department, these include other academics, reports, ets. Do not plagiarize.



A final checklist : Once the PEA is finished, every section should be reread and the following questions asked:

- Are all important findings covered?- Do the contents follow logically from the team’s findings? Are there contradictory findings that need to be

explained specifically? - Are there overlapping explanations that need to be tidied up?- Are there points of substance that have not been clearly articulated?

6.3 Consistent format, clear structureOne of the simplest errors researchers make is using an inconsistent report format. The minimum PEA outline found in Section 1.4 and Appendix 1 refer to the content of the body of the report. This section, however, refers to how the report is formatted. For example, are headings consistent? Are graphs and tables labelled in an easy to read manner? Is there a table of contents page? Is there a list of tables and graphs? Is there a list of references? Below are some simple tips with formatting your report.

• Every chapter needs a title typed in the same font with the same size of letters.

• To assist the reader, structure each chapter into sections and sub-sections as required. Each section and sub-section must include a heading that uses a consistent font. The hierarchy should be presented clearly, for instance by using capital letters, italics, underlining or bold for section and sub-section titles. This hierarchy should be reproduced in the table of contents.

• Tables, graphs and images must be enumerated clearly and consistently. Each table, graph and image must also have a title typed in a font distinct from the body text.

• Tables, graphs and images must cite the relevant data source.

• As each chapter focuses on a specific thematic area, report recommendations are best written per chapter as the final section of each chapter

ChecklistBelow is a checklist that all PEA reports should include:

1. Cover 2. Title page

Includes report title; names of members of research team; the organizations that commissioned the report; the draft status (e.g. first draft, second draft, final draft), and the date of completion/submission.

3. Table of Contents4. Lists of tables5. List of graphs6. List of images7. List of annexes

[Table of contents, list of tables, lists of graphs, list of images and list of annexes should be accurate with clear layout (including indentation) and include page numbers]

8. Glossary 9. Contents of report (body)



As suggested in this Manual, a report may contain the following chapters:i. Overview 1. Section 1 a. Sub-section 1 b. Sub-section 2

2. Section 2ii. Planning and Budgetingiii. Revenueiv. Spendingv. Sectoral Chapter

10. References11. Annexes

6.4 Writing the PEA report as a teamPEA reports are often written by a team with different members of the team responsible for writing different sections of the report. Although this sharing of work means more data can be collected and analyzed, it also runs the risk that each researcher will write with different writing styles and use different formats. From the outset, the team should agree upon the font, font size, line spacing, spacing between sections and sub-sections, and other details pertaining to report formatting. While each member of the team is responsible for ensuring that each person’s work is consistent with the overall report, the team leader is responsible for editing the report to ensure consistency across the work of the different researchers.

6.5 Further referencesThe websites below provide further guidance on report writing:

University of South Australia, Report Writing (cited June 17, 2008), http://www.roma.unisa.edu.au/07118/language/reports.htm

The International Development Research Centre, Writing A Research Report (cited June 17, 2008), http://www.idrc.ca/en/ev-56466-201-1-DO_TOPIC.html

6.6 Extra tips: some lessons learnedBased on the experience of researchers conducting PEA, we have compiled some additional tips and tricks that will help the researcher write a better PEA report. The following illustrate some of the common problems that arise in PEA reports:

Always ask “why”?The most common trap that researchers fall into when writing a PEA report is that while they describe the trend very well they forget to follow up that description with an explanation of why the trend occurred. For example, if the trend shows that per capita revenue increased between 1999 and 2005, then the question is why has this happened? Is this caused by an increase in DAU, DAK or PAD? If caused by DAU, why has the DAU increased? Has the fiscal capacity increased? Or has the PAD increased? If so, then why? Has the tax collection been more efficient? Or are more businesses registered and therefore there is more registration tax?

The above example shows that simply explaining that the PAD has increased is insufficient. When writing, always try to think from the readers’ perspective. In the above example, the audience will automatically ask: why has the



PAD increased? The audience will expect to find a policy or behavioral reason that explains the trend. For example, was there a new type of PAD allowed by regulation? Or has the sub-national government put more attention on collecting local taxes? If there is a trend, there is generally a reason explaining why this trend occurred and a good researcher will always ask “why”.

Go beyond the minimum:This manual has discussed at length how to fulfill the minimum requirements for a PEA. In addition to meeting the minimum standard, researchers are encouraged to include research ideas of their own that will contribute to the overall quality of the research and the recommendations. The PEA structure is dynamic and researchers should not feel restricted to the methodologies and indicators proscribed by this manual. Some ways of going beyond the minimum include:

• Collecting more data: The researcher should feel free to collect more data than that set out in Appendix 2. This may include adding new outcome indicators in health, education and infrastructure, increasing the data time span (i.e. 10 years is better than five), or obtaining more detailed APBD information by sourcing more detailed expenditure reports from the relevant Dinas. All of these will help to improve the depth of the PEA analysis considerably.

• Using other methodologies: Chapter 4 outlines some suggested methodologies for analyzing data. Researchers should not be constrained to using only those methodologies found in Chapter 4.

• Analyzing other sectors: The PEA has a focus on public service delivery so the sectoral focus is inevitably on the education, health and infrastructure sectors. However, researchers should feel free to identify other sectors of particular interest to the government or the researcher him/herself. For example, agriculture and fisheries are often important sectors to some provinces, and this may be another sector of interest in the PEA.

In all instances, researchers may face data limitations and must be mindful that to do meaningful analysis and draw sensible conclusions the data still need to be detailed, accurate, comparable and timely.

Rounding:One final minor although important tip is that when presenting analysis try to round numbers to a level that the reader will find easy to read while detailed enough to remain meaningful. For example, the per capita revenue for a province is Rp 95,698 in kabupaten 1, but and Rp 98,374 for kabupaten 2. In this instance, rounding is not required because all numbers are needed to show the difference between kabupaten 1 and 2. However, if the comparison is the total revenue for kabupaten 1 is Rp 128,476,890,346.00, while the total revenue for kabupaten 2 is Rp 130,900,087,756.00, then the numbers should be rounded to the nearest billion rupiah to become Rp 128 billion and Rp 131 billion, respectively. Another rounding method is to use decimals. In the second example, the rounded numbers become Rp 128.48 billion and Rp 130.9 billion, respectively. In both methods, the numbers are much easier to read and comprehend. It is up to the researcher how she or he chooses to round, but the researcher should be vigilant about consistency in rounding.


Appendices

App

endi

ces

App

endi

x 1:

PEA

Sta

ndar

d O

utlin

e

Chap

ter

Key

Sect

ions

Purp

ose

Key

Que

stio

nsKe

y In

dica

tors

Key

Proc

esse

sKe

y Po

licy

Ex

ec

ut

iv

e Su

mm

ary

Intr

oduc

tion

Ad

min

istr

ativ

e co

ntex

t

To

prov

ide

brie

f de

scrip

tion

of c

onte

xt

of

the

regi

onal

ad

min

istr

ativ

e ar

eas

Adm

inis

trat

ive

cont

ext

Num

bers

of k

abup

aten

, kot

a, a

nd

the

size

of

each

adm

inis

trat

ive

regi

on

Geo

grap

hy

&

popu

latio

n

To

desc

ribe

loca

tion

and

popu

latio

n of

the

pr

ovin

ceLo

catio

nM

ap o

f pro

vinc

e

Pie

grap

h sh

owin

g la

ndm

ass

and

cont

ribut

ion

of

kabu

pate

n/ko

ta

land

mas

s to

tota

l pro

vinc

e ar

ea

Popu

latio

nPi

e gr

aph

show

ing

tota

l nu

mbe

r of

po

pula

tion

per k

abup

aten

/kot

a

Gra

ph s

how

ing

tren

d of

pop

ulat

ion

grow

th

Brie

f ex

plan

atio

n on

et

hnic

co

nfigu

ratio

n, h

isto

ry o

f go

vern

ance

, et

c (if

pos

sibl

e)

Econ

omy

To d

escr

ibe

loca

l eco

nom

ic

deve

lopm

ent:

econ

omic

st

ruct

ure,

gr

owth

, em

ploy

men

t, lo

cal i

ssue

s.

Wha

t is

the

eco

nom

ic s

truc

ture

of

th

e pr

ovin

ce?

Wha

t se

ctor

s do

min

ate?

Gra

ph s

how

ing

stru

ctur

e of

eco

nom

y

Has

the

gro

wth

rate

incr

ease

d or

de

crea

sed

over

tim

e? W

hy?

Gra

ph

show

ing

RGD

P gr

owth

by

se

ctor

Is

the

prov

inci

al

grow

th

rate

hi

gher

or

lo

wer

th

an

natio

nal

grow

th ra

te?

Line

gra

ph s

how

ing

prov

inci

al a

nd

the

natio

nal p

rovi

ncia

l gro

wth

rat

e of

RG

DP

Wha

t se

ctor

s co

ntrib

ute

mos

t to

em

ploy

men

t?G

raph

sh

owin

g st

ruct

ure

of

empl

oym

ent


Appendices

Whi

ch e

mpl

oym

ent

sect

ors

are

grow

ing

the

fast

est?

Sl

owes

t?

Why

?

Gra

ph s

how

ing

empl

oym

ent

grow

th

by s

ecto

r

Is

the

prov

inci

al

empl

oym

ent

grow

th ra

te h

ighe

r or l

ower

than

na

tiona

l em

ploy

men

t gr

owth

ra

te? W

hy?

Line

gra

ph s

how

ing

prov

inci

al a

nd

the

natio

nal p

rovi

ncia

l gro

wth

rat

e of

em

ploy

men

t

Wha

t ar

e so

me

spec

ific

loca

l ec

onom

ic

prob

lem

s?

E.g.

m

alnu

triti

on?

Confl

ict?

W

hat

caus

ed th

ese

spec

ific

prob

lem

s?

Spec

ific

issu

es

on

loca

l ec

onom

y pr

oble

m a

nd c

hala

nge

Pove

rty

To

desc

ribe

pove

rty

cond

ition

s co

mpa

red

with

na

tiona

l con

ditio

n

Is

the

prov

inci

al

pove

rty

rate

hi

gher

tha

n th

e na

tiona

l pov

erty

ra

te?

Or l

ower

?

Gra

ph s

how

ing

pove

rty

head

coun

t of

th

e pr

ovin

ce a

nd n

atio

nal p

rovi

ncia

l

Has

po

vert

y ra

te

incr

ease

d or

de

crea

sed

over

tim

e?G

raph

sho

win

g tr

end

of p

rove

rty

HD

I and

SPM

Des

crib

e th

e cu

rren

t le

vel

of H

uman

D

evel

opm

ent I

ndex

and

the

min

imum

se

rvic

e st

anda

rds

Plan

ning

an

d B

ud

ge

tin

g (B

ud

ge

tin

g Cy

cle)

1. T

o de

scrib

e th

e na

tiona

l pl

anni

ng

and

budg

etin

g fr

amew

ork.

2. T

o as

sess

whe

ther

loc

al

plan

ning

an

d bu

dget

ing

proc

esse

s fo

llow

th

e na

tiona

l fra

mew

ork.

3. T

o as

sess

the

cons

iste

ncy

of

plan

ning

do

cum

ents

an

d w

heth

er

cons

iste

nt

with

the

natio

nal p

lan.

4.

To

asse

ss

whe

ther

th

e bu

dget

re

flect

s th

e de

velo

pmen

t pr

iorit

ies

foun

d in

th

e pl

anni

ng

docu

men

ts.

Pl

an

ni

ng

Proc

esse

s

To

asse

ss

whe

ther

pr

ovin

cial

and

dis

tric

t pl

anni

ng

follo

w

the

natio

nal g

uide

lines

Wha

t pl

anni

ng

docu

men

ts

are

requ

ired

by n

atio

nal

guid

elin

es?

Hav

e th

e su

b-na

tiona

l go

vern

men

ts

prod

uced

th

ose

docu

men

ts

Num

ber o

f pla

nnin

g do

cum

ents

Are

th

e pl

anni

ng

docu

men

ts

subm

itted

ac

cord

ing

to

the

natio

nal t

imel

ine?

Dat

e w

hen

plan

ning

doc

umen

ts

subm

itted


Has

th

e pl

anni

ng

proc

ess

follo

wed

the

pro

cess

set

out

by

the

natio

nal g

uide

lline

s?Co

mpa

re th

e pl

anni

ng p

roce

sses

Bu

dg

et

ing

Proc

esse

s

To

asse

ss

whe

ther

pr

ovin

cial

and

dis

tric

t bu

dget

ing

follo

ws

the

natio

nal g

uide

lines

Is

each

ye

ar’s

budg

et

docu

men

t fo

llow

ing

the

form

at

requ

ired

by

the

natio

nal r

egul

atio

ns?

If no

t fo

llow

g

uid

eli

ne

s,

how

to

im

pr

ov

e?

Th

ro

ug

h c

ap

ac

it

y b

uil

din

g?

Te

ch

nic

al

assi

stan

ce?

Are

th

e bu

dget

ing

docu

men

ts

subm

itted

ac

cord

ing

to

the

natio

nal

timel

ine?

Dat

e w

hen

budg

etin

g do

cum

ents

su

bmitt

ed.

Has

the

bud

getin

g pr

oces

s fo

llow

ed t

he p

roce

ss s

et o

ut

in th

e na

tiona

l gui

delin

es?

Com

pare

bud

getin

g pr

oces

ses.

De

velo

pm

en

t Pr

iorit

ies

and

Budg

etin

g

To d

escr

ibe

prov

inci

al

deve

lopm

ent p

riorit

ies

Wha

t ar

e th

e pr

iorit

y se

ctor

s m

entio

ned

in t

he p

rovi

ncia

l RP

JMD

?RJ

PMD

Brie

f de

scrip

tion

on “

urus

an

waj

ib” a

nd “u

rusa

n pi

lihan

”

To

asse

ss

linka

ges

betw

een

plan

ning

do

cum

ents

Are

th

e de

velo

pmen

t pr

iorit

ies

in

the

prov

inci

al

plan

ning

do

cum

ent

also

re

flect

ed

in

the

Rens

tra

and

kabu

pate

n pl

anni

ng

docu

men

ts?

RJPM

D, R

enst

ra e

tc

Are

th

e pr

ovin

cial

de

velo

pmen

t pr

iorit

ies

cons

iste

nt w

ith t

he n

atio

nal

plan

?

Un

de

rs

ta

nd

ing

linka

ges

betw

een

plan

ning

an

d bu

dget

ing

Doe

s th

e pu

blic

bu

dget

re

veal

th

e de

velo

pmen

t go

als

stat

ed in

the

pla

nnin

g do

cum

ents

?

RJPM

D, R

enst

ra e

tc

Doe

s th

e bu

dget

refl

ect

the

deve

lopm

ent p

riorit

ies i

n th

e pl

anni

ng d

ocum

ents

?

If no

t, w

hat a

re

way

s to

lin

k pl

anni

ng

and

budg

etin

g?


Appendices

Sum

mar

y &

Re

com

en-

datio

n

Reve

nue

and

Fina

ncin

g

1.

To

calc

ulat

e to

tal

reve

nue

enve

lope

2.

To

un

ders

tand

re

venu

e so

urce

s an

d co

nstr

aint

s3.

To

cal

cula

te d

efici

t an

d su

rplu

s (id

entif

y po

licy)

4. T

o un

ders

tand

how

th

e lo

cal g

over

nmen

ts

reco

rd

thei

r re

venu

e an

d fin

anci

ng

Ove

rall

Reve

nue

Pict

ure

1. H

ow m

uch

reve

nue

does

th

e re

gion

hav

e ov

ertim

e?

Fisc

al re

venu

e pe

r cap

ita (f

or e

ach

reve

nue

item

)B

en

ch

ma

rk

anal

ysis

How

do

es

the

prov

ince

s

ho

ul

d a

ll

oc

at

e th

eir

mon

ey

to

equa

lize

the

fisca

l ca

paci

ty?

2.

How

is

th

e re

venu

e di

strib

uted

ac

ross

ka

bupa

ten/

kota

Tabl

e 1

3. W

hat i

s th

e co

mpo

sitio

n of

th

e re

venu

e (D

AU, D

AK,

etc

)?Ta

ble

2

DAU

(G

ener

al

Allo

catio

n G

rant

)

1. W

hat

is

the

desc

riptio

n an

d co

nstr

aint

DAU

Per

Cap

ita (

Prov

ince

& K

ab/

Kota

)B

en

ch

ma

rk

anal

ysis

How

effe

ctiv

e is

th

e D

AU

fo

rm

ula

? Fr

om

an

ineq

ualiz

atio

n pr

espe

ctiv

e?

2. W

hat

is

the

tren

d ov

er

time?

Why

?C

orr

ela

tio

n an

alys

is

3. W

hat

is t

he d

istr

ibut

ion

with

in

prov

ince

? Re

lativ

e to

pov

erty

rat

e? R

elat

ive

to

civi

l se

rvan

ts?

Rela

tive

to

expe

nditu

re n

eeds

?

Pove

rty

rate

s, ci

vil

serv

ants

and

ex

pend

iture

ne

eds

(from

D

AU

form

ula)


Appendices

DA

K (S

peci

al

Allo

catio

n G

rant

)

1. W

hat

is

the

desc

riptio

n an

d co

nstr

aint

? H

ow d

oes

it w

ork

in p

ract

ice?

DA

K is

use

d to

fina

nce

wha

t?

DA

K by

sec

tor

and

by p

rovi

nce/

kab/

kota

(allo

catio

n vs

real

izat

ion)

Be

nc

hm

ar

k an

alys

is

2. H

ow m

uch

DA

K ov

er ti

me?

DA

K pe

r ca

pita

(pr

ovin

ce &

kab

/ko

ta)

3.

Wha

t is

th

e se

ctor

al

com

posi

tion

of D

AK?

4. H

ow is

the

DA

K di

strib

uted

ac

ross

leve

ls o

f go

vt (

prov

&

kab/

kota

) and

bet

wee

n ka

b/ko

ta

Shar

ed

Tax

Reve

nue

/ Sh

ared

N

atur

al

Re

so

ur

ce

Reve

nue

1.

Wha

t is

the

regu

latio

n an

d th

e fo

rmul

a?

Shar

ed

tax

reve

nue

/ Sh

ared

na

tura

l re

sour

ce

reve

nue

per

capi

ta (p

rovi

nce

& k

ab/k

ota)

Be

nc

hm

ar

k an

alys

is

2. H

ow m

uch

over

tim

e? A

re

they

con

sist

ent

over

tim

e?

(pro

vinc

e an

d ka

b/ko

ta)

3. W

hat i

s th

e co

mpo

sitio

n?

4. H

ow a

re t

hey

dist

ribut

ed

with

in

prov

ince

? A

ny

sign

ifica

nt in

equa

lity?

Why

?

PAD

(O

wn

Sour

ce R

even

ue)

1.

How

muc

h ov

er t

ime?

Are

th

ey c

onsi

sten

t ov

er t

ime?

(p

rovi

nce

& k

ab/k

ota)

PAD

per

cap

ita (

prov

ince

& k

ab/

kota

)B

en

ch

ma

rk

anal

ysis

Doe

s th

e re

gion

nee

d to

in

crea

se P

AD

? If

yes,

whi

ch

ones

?

2. W

hat i

s th

e co

mpo

sitio

n?

3. W

hat

are

the

mai

n ta

xes

and

user

cha

rges

(pro

vinc

e &

ka

b/ko

ta)?

Ana

lyze

th

e Pe

rda

of

mai

n ta

xes

and

user

ch

arge

s. W

hat

is

the

rate

? Re

lativ

e to

ot

her

kab/

kota

or

ot

her

prov

ince

s?


Appendices

4.

How

effi

cien

t is

th

e co

llect

ion

mec

hani

sm?

Do

the

prov

ince

s an

d ka

b/ko

ta

have

one

roof

sys

tem

?

Reve

nue

colle

cted

vs

co

st

of

colle

ctio

n

Fina

ncin

g

1.

How

m

uch

surp

lus

/ de

ficit?

Fina

ncin

g in

flow

and

out

flow

, ca

rry

over

.B

en

ch

ma

rk

anal

ysis

Doe

s th

e re

gion

ha

ve

fisca

l sp

ace?

H

ow

does

it

crea

te it

?

2. H

ow d

o th

e pr

ovin

ce/k

ab/

kota

fina

nce

the

defic

it?

3. H

ow d

o th

e pr

ovin

ce/k

ab/

kota

allo

cate

the

surp

lus

4.

How

do

th

ey

reco

rd

the

surp

lus/

defic

it?

Is

it co

nsis

tent

w

ith

the

real

su

rplu

s/de

ficit

calc

ulat

ed

by t

otal

rev

enue

min

us t

otal

ex

pend

iture

?

Sum

mar

y &

Re

com

men

-da

tion

Expe

nditu

reTo

ca

lcul

ate

tota

l re

gion

al e

xpen

ditu

re.

To

unde

rsta

nd

expe

nditu

re

tren

ds

acro

ss ti

me.

To

unde

rsta

nd

who

(c

entr

al,

prov

inci

al,

dist

rict)

sp

ends

th

e m

oney

.

To

unde

rsta

nd

how

m

oney

is

sp

ent

- ec

onom

ic

clas

sific

atio

n, s

ecto

rs.

To

unde

rsta

nd

varia

tions

be

twee

n di

stric

ts.

Ove

rvie

w

Wha

t is

th

e to

tal

regi

onal

ex

pend

iture

ove

r tim

e?

Se

e Ta

ble

1

Line

gr

aph

sh

ow

in

g su

b-n

ati

on

al

expe

nditu

re o

ver

time.


Appendices

How

doe

s per

cap

ita re

gion

al

expe

nditu

re

com

pare

to

ot

her p

rovi

nces

in In

done

sia?

Tota

l Exp

endi

ture

; pop

ulat

ion

Bar

grap

h sh

owin

g pe

r ca

pita

sp

endi

ng

com

pare

d to

ot

her p

rovi

nces

.

Who

sp

ends

th

e m

oney

? Ce

ntra

l go

vern

men

t?

Prov

inci

al

gove

rnm

ent?

O

r di

stric

t gov

ernm

ents

?

See

Tabl

e 1

Bar

grap

h s

ho

wi

ng

who

in

curr

ed

expe

nditu

re o

ver

time.

Is

cent

ral

go

vern

men

t d

om

ina

tin

g s

pe

nd

ing

? P

ol

ic

y im

plic

atio

ns?

Ec

on

om

ic

and

Sect

oral

C

lass

ific

atio

n (R

outin

e v

Dev

elo

pm

ent;

Ca

pita

l v

Non

-ca

pita

l)

Expl

ain

budg

et

form

at,

chan

ges

in

budg

et

form

at

and

how

sp

endi

ng

is

clas

sifie

d.

Co

ns

ide

r im

pli

cati

on

s of

bu

dget

f

or

ma

t ch

ange

d to

o of

ten.

Ove

rall,

w

hat

type

of

ex

pend

iture

do

min

ates

re

gion

al sp

endi

ng o

ver t

ime?

W

hy?

See

Tabl

e 2

Bar/

line

grap

h sh

owin

g m

ix

betw

een

type

s of

ex

pend

iture

ov

er ti

me.

Ass

umin

g th

at

one

of

type

ex

pen

dit

ure

is

m

ore

effec

tive

than

ot

hers

(e

.g.

Wha

t ty

pe

of

expe

nditu

re

dom

inat

es

prov

inci

al

spen

ding

ove

r tim

e? W

hy?

See

Tabl

e 3

Bar/

line

grap

h sh

owin

g m

ix

betw

een

type

s of

expe

nditu

re o

ver

time

at p

rovi

ncia

l le

vel.

Wha

t ty

pe

of

expe

nditu

re

dom

inat

es d

istr

ict

spen

ding

ov

er ti

me?

Why

?Se

e Ta

ble

4

Bar/

line

grap

h sh

owin

g m

ix

betw

een

type

s of

expe

nditu

re o

ver

time

at

dist

rict

leve

l.


Appendices

Sect

oral

Whi

ch

sect

ors

have

do

min

ated

sp

endi

ng

over

tim

e? W

hy?

See

Tabl

e 5

Gra

ph

show

ing

se

ct

or

al

dis

trib

uti

on

over

co

mpa

ring

seve

ral y

ears

.

Has

a

su

ffic

ien

t po

rtio

n of

the

bu

dget

be

en

allo

cate

d to

ke

y se

rvic

e se

ctor

s su

ch

as

educ

atio

n,

heal

th

and

infr

astr

uctu

re?

[As

su

me

s th

at

serv

ice

deliv

ery

has

a st

rong

co

rre

lati

on

with

am

ount

of

bu

dget

al

loca

ted

to

thos

e se

ctor

s]

At

prov

inci

al l

evel

, wha

t ar

e th

e m

ost

impo

rtan

t se

ctor

s?

Why

?Se

e Ta

ble

6

Gra

ph

show

ing

se

ct

or

al

dis

trib

uti

on

over

co

mpa

ring

seve

ral y

ears

.

At

dist

rict

leve

l, w

hat

are

the

mos

t im

port

ant

sect

ors?

W

hy?

See

Tabl

e 7

Gra

ph

show

ing

se

ct

or

al

dis

trib

uti

on

over

co

mpa

ring

seve

ral y

ears

.

In

the

mos

t im

port

ant

sect

ors

- he

alth

, ed

ucat

ion

and

infr

astr

uctu

re

- w

hich

do

min

ates

spen

ding

(cen

tral

, pr

ovin

cial

or d

istr

icts

)? W

hy?

See

Tabl

e 8

Tabl

e 8

Is

cent

ral

go

vern

men

t d

om

ina

tin

g s

pe

nd

ing

? P

ol

ic

y im

plic

atio

ns?

Spen

ding

by

D

istr

ict

Whi

ch

dist

ricts

ha

ve

the

high

est

leve

l of

per

cap

ita

spen

ding

? Why

?Se

e Ta

ble

9

Bar

grap

h c

om

pa

rin

g ex

pend

iture

by

di

ffere

nt d

istr

icts

Is th

ere

stro

ng

ine

qu

ali

ty

be

tw

ee

n di

stric

ts?

If so

, w

hy?

Can

this

be

im

prov

ed?

How

?

Whi

ch

dist

ricts

ha

ve

the

high

est

leve

l of

per

cap

ita

educ

atio

n sp

endi

ng? W

hy?

See

Tabl

e 9

Bar

grap

h c

om

pa

rin

g e

du

ca

ti

on

expe

nditu

re

by

diffe

rent

dis

tric

ts


Appendices

Whi

ch d

istr

icts

hav

e hi

ghes

t le

vel

of

heal

th

spen

ding

? W

hy?

See

Tabl

e 9

Bar

grap

h c

om

pa

rin

g h

ea

lt

h ex

pend

iture

by

di

ffere

nt d

istr

icts

Whi

ch d

istr

icts

hav

e hi

ghes

t le

vel

of

infr

astr

uctu

re

spen

ding

? Why

?Se

e Ta

ble

9

Bar

grap

h c

om

pa

rin

g in

fras

tru

ctu

re

expe

nditu

re

by

diffe

rent

dis

tric

ts

Plan

ned

vers

us

Real

izat

ion

Wha

t is t

he o

vera

ll re

aliz

atio

n ra

te?

Has

gov

ernm

ent

been

ab

le t

o sp

end

its b

udge

t? I

f no

t, w

hy?

Tota

l rea

lizat

ion

rate

.

Has

th

e g

ove

rnm

ent

man

aged

to

sp

end

thei

r a

llo

ca

te

d fu

nds?

If

not,

why

?

Wha

t is

the

rea

lizat

ion

tren

d fo

r ec

onom

ic c

lass

ifica

tion?

Ex

plai

n re

ason

s fo

r un

der-

real

izat

ion

and

over

-sp

endi

ng.

See

Tabl

e 10

Tabl

e sh

owin

g re

ali

za

tio

n pe

rcen

tage

.

Wha

t is

the

rea

lizat

ion

tren

d fo

r se

ctor

s? E

xpla

in r

easo

ns

for

unde

r-re

aliz

atio

n an

d ov

er-s

pend

ing.

See

Tabl

e 11

Tabl

e sh

owin

g re

ali

za

tio

n pe

rcen

tage

.

Find

ings

Who

do

es

the

bulk

of

th

e sp

endi

ng?

Polic

y im

plic

atio

ns?

Wha

t ty

pes

of

spen

ding

do

min

ate

expe

nditu

re?

Polic

y im

plic

atio

ns?

Wha

t se

ctor

s do

min

ate

spen

ding

? Po

licy

impl

icat

ions

?

Are

the

re h

igh

ineq

ualit

ies

betw

een

dist

ricts

? Po

licy

impl

icat

ions

?

Hav

e go

vern

men

ts g

ener

ally

m

et

budg

et

targ

ets

(real

izat

ion

rate

s)?

Polic

y im

plic

atio

ns?

Sum

mar

y &

re

com

men

-da

tion


Appendices

Sect

oral

1.

Ove

rvie

w

of

the

sect

oral

allo

catio

ns a

nd

the

curr

ent

sect

oral

pe

rfor

man

ce (

the

link

betw

een

expe

nditu

res

as

inpu

ts

and

sect

oral

pe

rfor

man

ce

or

indi

cato

rs

as

outc

omes

). H

opef

ully

, th

e ou

tcom

e an

d ou

tput

ju

stify

ho

w

a re

gion

sp

ends

its

bu

dget

. 2.

To

se

e ho

w

the

outc

ome

refle

cts

the

spen

ding

, an

d sp

endi

ng

refle

cts

the

prio

ritie

s.

- Ag

ree

on

se

ct

or

al

defin

ition

- Ag

ree

on d

ata

sour

ces

- A

naly

ze

data

fr

om B

PS a

nd/o

r D

inas

- Co

mpa

re

sp

en

din

g-

outp

ut-o

utco

me

with

ot

her

regi

ons

- Be

nefit

in

cide

nce

(ver

y ba

sic)

Hea

lth

Plan

ning

To a

naly

ze t

he h

ealth

po

licy

for t

he p

rovi

nce.

-Is h

ealth

a p

riorit

y in

the

pr

ovin

ce's

plan

ning

?-

If so

, wha

t ar

e th

e sp

ecifi

c he

alth

prio

ritie

s?

Plan

ning

doc

umen

ts

Agre

e on

p

la

nn

in

g do

cum

ents

th

at

will

be

anal

yzed

.

- A

re t

here

diff

eren

t he

alth

pr

iorit

ies

betw

een

dist

ricts

?-

Are

th

e he

alth

pr

iorit

ies

cons

iste

nt w

ith t

he n

atio

nal

leve

l hea

lth p

riorit

ies?

Spen

ding

(Inp

ut)

To

anal

yze

the

spen

ding

pa

tter

ns

in

heal

th s

pend

ing

- W

hat

perc

enta

ge o

f to

tal

sub-

natio

nal

spen

ding

is

on

heal

th?

- H

as

the

shar

e of

to

tal

heal

th sp

endi

ng in

crea

sed

or

decr

ease

d ov

er ti

me?

Why

?-

Has

th

e he

alth

se

ctor

sp

endi

ng

incr

ease

d or

de

crea

sed

over

tim

e? W

hy?

APB

D, D

ekon

. HH


Appendices

- W

hat

is

the

per

capi

ta

spen

ding

on

heal

th?

‘- Is

it

high

er

than

th

e na

tiona

l per

cap

ita a

vera

ge?

Com

pare

d w

ith o

ther

sim

ilar

prov

ince

s?- W

hat i

s the

per

cap

ita h

ealth

sp

endi

ng

of

each

di

stric

t?

Are

th

ere

big

varia

tions

be

twee

n di

stric

ts?

- W

hat

prop

ortio

n of

th

e he

alth

se

ctor

sp

endi

ng

is

by

dist

rict

gove

rnm

ent,

prov

inci

al g

over

nmen

t an

d ce

ntra

l gov

ernm

ent?

- Wha

t is t

he tr

end

over

tim

e?

Why

?

- W

hat

is

the

hous

ehol

d ex

pend

iture

on

heal

th?

- Is

this

hig

her

or lo

wer

tha

n na

tiona

l av

erag

e?

Oth

er

sim

ilar p

rovi

nces

?

- Wha

t has

the

heal

th b

udge

t be

en a

lloca

ted

to?

Acco

rdin

g to

pr

ogra

m

clas

sific

atio

n?

Acco

rdin

g to

ec

onom

ic

clas

sific

atio

n?

Sp

en

di

ng

(Out

put)

To

anal

yze

wha

t ou

tput

s ha

ve

been

ac

hiev

ed

thro

ugh

heal

th

spen

ding

(e

.g.

infr

astr

uctu

re, f

acili

ties,

hum

an

reso

urce

s, pr

ogra

ms

etc)

.

- H

ow m

any

Pusk

esm

as a

re

ther

e in

the

prov

ince

?-

How

do

es

this

co

mpa

re

with

the

natio

nal a

vera

ge?

- W

hat

is

the

num

ber

of

Pusk

esm

as i

n ea

ch d

istr

ict?

Va

riatio

ns b

etw

een

dist

ricts

?

Num

ber o

f Pus

kesm

as


Appendices

- H

ow

man

y do

ctor

s an

d m

idw

ive

are

ther

e pe

r 10,

000

peop

le?

Per k

m2?

- H

ow

does

th

is

com

pare

w

ith th

e na

tiona

l rat

io?

- Co

mpa

re b

etw

een

dist

ricts

in

the

pro

vinc

e? A

re t

he b

ig

varia

tions

bew

een

dist

ricts

? Be

twee

n ur

ban

and

rura

l?

Num

ber o

f hea

lth w

orke

rs

- Ra

tio o

f birt

hs a

tten

ded

by

heal

thca

re w

orke

r

Out

com

esA

naly

ze

the

curr

ent

cond

ition

of h

ealth

Som

e ge

nera

l in

dica

tors

: M

orbi

dity

ra

tes/

child

nu

triti

on/in

fant

m

orta

lity

for

the

prov

ince

? Be

twee

n di

stric

ts?

Com

pare

w

ith

natio

nal r

ate

Mor

bidi

ty

rate

, ch

ild

nutr

ition

, in

fant

mor

talit

y.

- Im

mun

izat

ion

rate

fo

r pr

ovin

ce?

For

each

dis

tric

t?

Com

pare

with

nat

iona

l rat

e?Im

mun

izat

ion

rate

Hea

lth

serv

ices

ut

iliza

tion:

se

lf tr

eatm

ent,

com

pare

d w

ith h

ealth

clin

ics

etc.

Hea

lth s

ervi

ces

utili

zatio

n ra

te.

Wha

t is

the

util

izat

ion

rate

of

pu

blic

he

alth

fa

cilit

ies?

Co

mpa

red

with

na

tiona

l av

erag

e?

Oth

er

sim

ilar

prov

ince

s?Co

mpa

re

utili

zatio

n ra

tes

betw

een

dist

ricts

? Var

iatio

n?

Publ

ic h

ealth

ser

vice

s ut

iliza

tion

rate

.

Be

ne

fi

t-

in

ci

de

nc

e an

alys

is

Util

izat

ion

rate

s of

pu

blic

he

alth

fac

ilitie

s ac

cord

ing

to

inco

me

leve

ls.

Publ

ic h

ealth

ser

vice

s ut

iliza

tion

rate

.

Be

ne

fi

t-

in

ci

de

nc

e an

alys

is

Util

izat

ion

rate

s of

pu

blic

he

alth

fac

ilitie

s ac

cord

ing

to

gend

er?

Any

oth

er o

utco

mes

e.g

. HIV

ra

tes

etc.


Find

ings

Ana

lyze

th

e lin

k be

twee

n sp

endi

ng,

outp

uts

and

outc

omes

.- I

s th

ere

any

link?

If th

ere

is t

he

link,

w

hat

are

poss

ible

ar

eas

for f

ocus

w

ithin

th

e he

alth

sec

tor?

Are

th

ere

ineq

ualit

y in

he

alth

be

twee

n di

stric

ts?

Betw

een

girls

and

boy

s? I

s th

is

also

re

flect

ed

in

the

spen

ding

leve

ls?

Sum

mar

y &

Re

com

men

-da

tion

Educ

atio

n

Plan

ning

To

anal

yze

the

educ

atio

n po

licy

for

the

prov

ince

.

-Is e

duca

tion

a pr

iorit

y in

the

prov

ince

’s pl

anni

ng?

- If

so, w

hat

are

the

spec

ific

educ

atio

n pr

iorit

ies?

Plan

ning

doc

umen

ts

Agre

e on

p

la

nn

in

g do

cum

ents

th

at

will

be

anal

yzed

.

- A

re

ther

e di

ffere

nt

educ

atio

n pr

iorit

ies

betw

een

dist

ricts

?- A

re th

e ed

ucat

ion

prio

ritie

s co

nsis

tent

with

the

nat

iona

l le

vel e

duca

tion

prio

ritie

s?

Spen

ding

(Inp

ut)

To

anal

yze

the

spen

ding

pa

tter

ns

in

educ

atio

n sp

endi

ng.

- W

hat

perc

enta

ge o

f to

tal

sub-

natio

nal

spen

ding

is

on

educ

atio

n?-

Has

th

e sh

are

of

tota

l ed

ucat

ion

spen

ding

in

crea

sed

or d

ecre

ased

ove

r tim

e? W

hy?

- H

as t

he e

duca

tion

sect

or

spen

ding

in

crea

sed

or

decr

ease

d ov

er ti

me?

Why

?

APB

D, D

ekon

. HH


Appendices

- W

hat

prop

ortio

n of

th

e ed

ucat

ion

sect

or

spen

ding

is

by

di

stric

t go

vern

men

t, pr

ovin

cial

gov

ernm

ent

and

cent

ral g

over

nmen

t?- W

hat i

s the

tren

d ov

er ti

me?

W

hy?

- W

hat

is

the

per

capi

ta

spen

ding

on

educ

atio

n?‘-

Is

it hi

gher

th

an

the

natio

nal p

er c

apita

ave

rage

? Co

mpa

red

with

oth

er s

imila

r pr

ovin

ces?

- W

hat

is

the

per

capi

ta

educ

atio

n sp

endi

ng

of

each

dis

tric

t? A

re t

here

big

va

riatio

ns b

etw

een

dist

ricts

?

- W

hat

is

the

hous

ehol

d ex

pend

iture

on

educ

atio

n?- I

s th

is h

ighe

r or

low

er t

han

natio

nal

aver

age?

O

ther

si

mila

r pro

vinc

es?

- Wha

t ha

s be

en t

he h

ighe

st

spen

ding

w

ithin

th

e

educ

atio

n se

ctor

acc

ordi

ng

to e

cono

mic

cla

ssifi

catio

n?

- Pr

ogra

m a

nd e

cono

mic

al

clas

sific

atio

n

Sp

en

di

ng

(Out

put)

To

anal

yze

wha

t ou

tput

s ha

ve

been

ac

hiev

ed

thro

ugh

educ

atio

n sp

endi

ng

(e.g

. in

fras

truc

ture

, fa

cilit

ies,

hum

an

reso

urce

s, pr

ogra

ms

etc)

.

- How

man

y sc

hool

s are

ther

e in

the

prov

ince

?- W

hat i

s the

ave

rage

num

ber

of s

tude

nts

per s

choo

l in

the

prov

ince

?-

How

do

es

this

co

mpa

re

with

the

natio

nal a

vera

ge?

- Av

erag

e nu

mbe

r of

st

uden

ts p

er s

choo

l in

eac

h di

stric

t? V

aria

tions

bet

wee

n di

stric

ts?

Num

ber o

f sch

ools

- GD

S an

alys

is


Appendices

- Wha

t is t

he st

uden

t-te

ache

r-ra

tio (

STR)

for

the

pro

vinc

e?

Com

pare

with

nat

iona

l STR

.-

Wha

t is

the

STR

for

eac

h di

stric

t?

Varia

tion

betw

een

dist

ricts

? Why

?

Num

ber o

f tea

cher

s

- Wha

t is t

he le

vel o

f tea

cher

s’ qu

alifi

catio

ns?

Teac

hers

’ qua

lifica

tion

- Wha

t is

the

leve

l of t

each

er

abse

ntee

ism

?Te

ache

rs’ a

tten

danc

e

- W

hat

is t

he c

ondi

tion

of

clas

sroo

ms

in th

e pr

ovin

ce?

- Co

mpa

re

with

na

tiona

l av

erag

e? C

ompa

re b

etw

een

dist

ricts

in p

rovi

nce?

Cond

ition

of c

lass

room

s

Ther

e m

ay b

e ot

her

outp

uts.

E.g.

tex

t bo

oks,

dist

ance

to

scho

ols

etc.

Text

boo

ks,

dist

ance

to

scho

ols

etc.

- W

hat

is

the

gros

s en

rollm

ent

rate

(G

ER)

at

prim

ary

scho

ol l

evel

? Ju

nior

se

cond

ary

scho

ol

leve

l?

Seni

or s

econ

dary

leve

l?-

How

doe

s it

com

pare

with

th

e na

tiona

l ave

rage

?-

Com

pare

the

GER

for

eac

h di

stric

t.-

Com

pare

enr

ollm

ent

rate

s by

gen

der?

Is

ther

e a

corr

elat

ion

betw

een

dist

ance

to

scho

ol

and

enro

llmen

t rat

e?

- U

sage

of

pu

blic

sc

hool

fa

cilit

ies

by in

com

e le

vel?

Be

ne

fi

t-

inc

ide

nc

e an

alys

is

- U

sage

of

pu

blic

sc

hool

fa

cilit

ies

by g

ende

r?

Be

ne

fi

t-

inc

ide

nc

e an

alys

is

Any

oth

er o

utco

mes

.


Appendices

Find

ings

Ana

lyze

th

e lin

k be

twee

n sp

endi

ng,

outp

uts

and

outc

omes

.- I

s th

ere

any

link?

If th

ere

is t

he

link,

w

hat

are

poss

ible

ar

eas

for f

ocus

w

ithin

th

e e

du

ca

tio

n se

ctor

Are

th

ere

ineq

ualit

ies

in

educ

atio

n be

twee

n di

stric

ts?

Betw

een

girls

an

d bo

ys?

Is t

his

also

refl

ecte

d in

the

sp

endi

ng le

vels

?

Sum

mar

y &

re

com

men

-da

tion

Infr

astr

uctu

re

Plan

ning

To

anal

yze

the

infr

astr

uctu

re

polic

y fo

r the

pro

vinc

e.

-Is in

fras

truc

ture

a p

riorit

y in

th

e pr

ovin

ce’s

plan

ning

?-

If so

, wha

t ar

e th

e sp

ecifi

c in

fras

truc

ture

prio

ritie

s?Pl

anni

ng d

ocum

ents

Agre

e on

p

la

nn

in

g do

cum

ents

th

at

will

be

anal

yzed

.

- A

re

ther

e di

ffere

nt

infr

astr

uctu

re

prio

ritie

s be

twee

n di

stric

ts?

- A

re

the

infr

astr

uctu

re

prio

ritie

s co

nsis

tent

with

the

na

tiona

l le

vel

infr

astr

uctu

re

prio

ritie

s?

Spen

ding

(Inp

ut)

To

anal

yze

the

spen

ding

pa

tter

ns

in

infr

astr

uctu

re

spen

ding

.

- W

hat

perc

enta

ge o

f to

tal

sub-

natio

nal

spen

ding

is

on

infr

astr

uctu

re?

- H

as

the

shar

e of

to

tal

infr

astr

uctu

re

spen

ding

in

crea

sed

or d

ecre

ased

ove

r tim

e? W

hy?

- H

as

the

infr

astr

uctu

re

sect

or s

pend

ing

incr

ease

d or

de

crea

sed

over

tim

e? W

hy?

APB

D, D

ekon

.HH


Appendices

- W

hat

is

the

per

capi

ta

spen

ding

on

infr

astr

uctu

re?

‘- Is

it

high

er

than

th

e na

tiona

l per

cap

ita a

vera

ge?

Com

pare

d w

ith o

ther

sim

ilar

prov

ince

s?-

Wha

t is

th

e pe

r ca

pita

in

fras

truc

ture

sp

endi

ng

of

each

dis

tric

t? A

re t

here

big

va

riatio

ns b

etw

een

dist

ricts

?

- W

hat

prop

ortio

n of

th

e in

fras

truc

ture

se

ctor

sp

endi

ng

is

by

dist

rict

gove

rnm

ent,

prov

inci

al

gove

rnm

ent

and

cent

ral

gove

rnm

ent?

- Wha

t is t

he tr

end

over

tim

e?

Why

?

- W

hat

is

the

hous

ehol

d ex

pend

iture

on

in

fras

truc

ture

?- I

s th

is h

ighe

r or

low

er t

han

natio

nal

aver

age?

O

ther

si

mila

r pro

vinc

es?

- W

hat

has

been

th

e hi

ghes

t sp

endi

ng

with

in

the

infr

astr

uctu

re

sect

or

acco

rdin

g to

sub-

sect

ors?

E.g

. tr

ansp

orta

tion,

el

ectr

icity

, te

lec

om

mu

nic

ati

on

s,

gove

rnm

ent b

uild

ings

etc

.

Wha

t ha

s do

min

ated

in

fras

truc

ture

sp

endi

ng

acco

rdin

g to

ec

onom

ic

clas

sific

atio

n.

Sp

en

di

ng

(Out

put)

To

anal

yze

wha

t ou

tput

s ha

ve

been

ac

hiev

ed

thro

ugh

infr

as

tr

uc

tu

re

spen

ding

(e

.g.

infr

astr

uctu

re, f

acili

ties,

hum

an

reso

urce

s, pr

ogra

ms

etc)

.

- Len

gth

of ro

ads

- Qua

lity

of ro

ads

- Co

mpa

re

over

tim

e.

Com

pare

w

ith

othe

r pr

ovin

ces,

com

pare

w

ith

natio

nal

leve

l, co

mpa

re

betw

een

dist

ricts

w

ithin

pr

ovin

ces.

Leng

th o

f roa

ds; q

ualit

y of

road

s.


Appendices

Out

com

esA

naly

ze

the

curr

ent

cond

ition

of

in

fras

truc

ture

.

Ana

lyse

in

fras

truc

ture

in

dica

tors

(pu

blic

san

itatio

n,

no s

anita

tion,

pip

ed w

ater

, im

prov

ed w

ater

, sa

nita

tion,

irr

igat

ion

cove

rage

, ro

ad

cove

rage

, acc

ess t

o el

ectr

icity

an

d an

y ot

her

rele

vant

in

dica

tors

) to

ev

alua

te

the

follo

win

g:

- H

ave

ther

e be

en

impr

ovem

ents

ove

r tim

e?-

Hig

her

or

low

er

than

na

tiona

l ra

te?

Com

pare

w

ithin

dis

tric

ts i

n pr

ovin

ce

(is t

here

ineq

ualit

y be

twee

n di

stric

ts?)

- D

iffer

entia

te

the

acce

ss

acco

rdin

g to

gro

ups

such

as

inco

me

leve

l (o

r ge

nder

, if

poss

ible

).

Be

ne

fi

t-

in

ci

de

nc

e an

alys

is,

time-

serie

s an

alys

is.

Find

ings

Ana

lyze

th

e lin

k be

twee

n sp

endi

ng,

outp

uts

and

outc

omes

.- I

s th

ere

any

link?

If th

ere

is t

he

link,

w

hat

are

poss

ible

ar

eas

for f

ocus

w

ithin

th

e in

fras

truc

ture

se

ctor

?

Are

th

ere

ineq

ualit

ies

in

infr

astr

uctu

re

betw

een

dist

ricts

? Be

twee

n in

com

e le

vels

? Is

this

als

o re

flect

ed in

th

e sp

endi

ng le

vels

?

Sum

mar

y &

Re

com

men

-da

tion

Loca

l Iss

ues

To b

e de

cide

d

Sum

mar

y &

Re

com

men

-da

tion


Appendices

Appendix 2: Data RequirementsThe objective of this section is to provide researchers with data requirements (both quantitative and qualitative) and some advice on where to obtain the data. The following also includes some advice on time-span of data, but this depends on the scope of the research. As discussed earlier, we recommend collecting data over at least five years, the general rule being that the more data the better the quality of analysis.

Data can be collected at both the national and sub-national levels. Where there are two sources for the same data (for example, APBD), the researcher needs to decide, at the outset, which source will be used for analysis. Each data source has its own advantages and disadvantages. See Section 4.2.1 for guidance on the appropriateness of each source.

1. National Sources: Ministry of Finance (MoF); Statistics Bureau (BPS); No Type Name Description Source Indicators

1 Fiscal APBN National expenditure (provincial level) by routine and development. MoF

Deconcentrated and assistance task Expenditure

APBD

Regional budget (Kab/Kota & provincial level) consists of revenue (by items), routine exp (by bagian and econ. class), and development exp (by sectors).(Makuda format), Public and apparatus spending (Kepmendagri 29 format); or Direct and indirect spending (Permendagri 13 format)

BPS ; MoF

Revenue, routine, development

DAU DAU allocation and basic data used for DAU calculation (Kab/Kota & provincial level) MoF

DAU allocation, p o p u l a t i o n , p o v e r t y incidence, area, IHBG, etc.

DAK DAK Dana Reboisasi and DAK Non Dana Reboisasi (Kab/Kota & provincial level) MoF

DAK allocation ( infrastructure, health, education sectors)

Borrowing Data on local government borrowing and arrears MoF

Realized loan, o u t s t a n d i n g amount of loan, total arrears

Local Taxes Revenue Sharing

Data on local taxes and levies MoF Taxes, levies

Revenue Sharing

Tax and non-tax revenue sharing for local governments MoF

PBB, BPTHB, PPh, SDA allocations by type and region

2 Non Fiscal

Social Indicators

Population Census or other

population data from

BPS

National population census, conducted once in ten years or other annual population data from BPS

BPS Population


References

Susenas

Susenas consists of CORE (annual) and MODULES (once in three years). It covers characteristics of household and members of household within sampled household.

BPS

E d u c a t i o n a t t a i n m e n t , literacy rate, % of urban population, h o u s e h o l d income and expenditure.

Sakernas

The Annual National Labor Force Survey (Sakernas) covers national labor market characteristics of all working age individuals within sampled households.

BPS

Labor force (by sector), employment rate, unemployment rate, etc.

PodesVillage Potential Survey (Podes) provides information about villages/desa characteristics and infrastructures.

BPS

no. of facilities ( s c h o o l s , Puskesmas, etc), % of family with phone, type of road available, acres of paddy field, etc.

Economic Indicators GRDP Regional Products (kab/Kota & provincial level)

by current & constant price BPS Sectoral products

Road Type of road at the kabupaten level MoPWLength of road, share of each type of road

Local Gov't Characteristics

GDS Governance Decentralization Survey 1, GDS 1+, GDS 2

WBOJ & PSKK-

UGM

G o v e r n a n c e indicators and decentralization ( t r a n s p a r e n c y, accountabi l i ty, service quality)

Civil Servant Census

Number of civil servants by localities BKN

Number of civil servants by structural c l a s s i f i c a t i o n , f u n c t i o n a l c l a s s i f i c a t i o n , characterist ics, golongan, etc


Appendices

2. Data from Sub-National Source : Quantitative

Type Name Years Source Indicators

Mandatory Indicators Population Latest Regional BPS To create per capita value

Regional CPI Latest Regional BPS To create real value

Fiscal APBD Latest

P r o v i n c i a l and local g o v e r n m e n t s financial reports ( p r e f e r a b l y audited financial reports)

Most detailed available breakdown of• Revenue• Expenditure

- Routine & Development (Makuda format)- Public & Apparatus (Kepmendagri 29 Format)- Direct & Indirect (Permendagri 13 Format)- Detailed expenditures on health facilities and schools, by type

• Financing (new budget format)

Fiscal Borrowing Latest Provincial and local government

• Level of debt• Loans by source (central government, bank etc).

FiscalShared natural

resource revenue

Latest P r o v i n c i a l government

• Criteria used for allocation shared revenue for oil, gas and forestry to kab/Kota• Amounts allocated to each kab/kota

Social Population Latest L o c a l government

• Local government’s estimate of total population• Local BPS office estimate of population

Social Poverty Latest L o c a l government

• Local government’s estimate of poverty• Local BPS office estimate of poverty

Social Education Latest L o c a l government

• Number of schools, by type• Number of students• Number of teachers (including regular and non-regular)• Amount of retribution collected• Education indicators used by local government (literacy rate, enrollment rate, education attainment, etc)


Appendices

Social Health Latest L o c a l government

• Number of health centers• Number of doctors and other health staff (including regular and non-regular)• Amount of retribution collected• Health indicators used by local government (births attended by skilled workers, infant mortality rate)

Infrastructure Water and Sanitation Latest Provincial and

local government

• Current status and condition of water infrastructure• Access to clean water

Road Latest Provincial and local government

• Length of roads, by type• Condition of roads

Local Politics DPRD Latest Provincial KPU office

• Composition of DPRD members (political parties represented)• Characteristics of DPRD members (educational background, gender)

Governance Civil Servants LatestP r o v i n c i a l and local governments

• Number of civil servants, by structural and functional category and by professional grade

QualitativeType Name Years Source Indicators

Planning Planning Process Latest Bappeda

• What plans are in place?• Does the public participate in the planning process? If yes, how?• Is there a plan/strategy for improvement of the economy? If yes, which sector(s) does it focus on?• How is the achievement of the plans monitored?

Budget Budget Preparation Latest

Biro Keuangan, Bappeda, head of each agency

• Is there a formal mechanism for the public to participate in the budgeting process? If yes, how effective is it?• How is quantitative information used to make budget decisions?• How are decisions made regarding government intervention in a particular sector?• Which institution/body makes decisions on the final budget allocations?

Budget Publication Latest Bappeda, Sekda

• Is the budget made available to the public? If yes, how (newspaper, government gazette etc.)?


Appendices

Budget Latest Biro Keuangan, Bappeda

• Which unit is responsible for disbursement?• Has the local treasury (BUD) been established?• What are the payment mechanisms (SPP)?• Are there problems in with cash management? If yes, which?• Has the budget been revised during the fiscal year?

Performance Budgeting Latest Bappeda

• Has performance budgeting been introduced yet?• If yes, how is performance monitored?


References

Transfer Disbursement of Transfer Latest Biro Keuangan

• When and in how many installments does the local government receive transfers from the central government and the province?• DAU• DAK• Shared natural resource revenue• Shared tax revenue

Format -- electronic wherever possible


References

References

Aran, Meltem (2007). Note on “Pro-Poor Targeting and the Effectiveness of Indonesia’s Fuel Subsidy Reallocation Programs”. Jakarta. Indonesia

Ghozali, Abbas. “Analisis Sejarah Kebijakan, Penyelenggaraan, dan Kondisi Pendidikan Dasar serta Implikasinya pada Pendidikan Dasar Gratis”. Makalah individual untuk studi Pendidikan Gratis yang diselenggarakan oleh BAPPENAS. Jakarta. Indonesia.

Pemerintah Daerah Kabupaten Belu (2004). Rencana Strategis Kabupaten Belu 2004-2008

Pemerintah Daerah Kabupaten Belu (2004). Rencana Strategis Dinas Pendidikan Kabupaten Belu Periode 2004-2008

Pemerintah Daerah Kabupaten Minahasa (2003). Rencana Stratejik Dinas Pendidikan dan Kebudayaan Kabupaten Minahasa Tahun 2003-2007

Pemerintah Daerah Kabupaten Timor Tengah Selatan (2004). Rencana Strategis Kabupaten Timor Tengah Selatan 2004-2008

Pemerintah Daerah Kabupaten Timor Tengah Selatan (2005). Rencana Strategis Dinas Pendidikan dan Kebudayaan Kabupaten Timor Tengah Selatan Tahun 2005-2009

Pemerintah Daerah Kota Binjai. Peraturan Walikota Binjai nomor 050-6525 tahun 2005 tentang Rencana Pembangunan Jangka Menengah Daerah Kota Binjai 2006-2010.

Pemerintah Daerah Kota Magelang (2005). Peraturan Daerah nomor 9 tahun 2005 tentang Rencana Pembangunan Jangka Menengah Kota Magelang Tahun 2005-2010.

Pemerintah Daerah Kota Manado (2005). Peraturan Daerah nomor 04 tahun 2005 tentang Rencana Pembangunan Jangka Menengah Daerah Kota Manado 2005-2010.

Pemerintah Daerah Kota Manado (2005). Matriks Program Lima Tahunan (RPJMD dan Renstra SKPD). Dinas Pendidikan Kota Manado

Pemerintah Indonesia (2007). Peraturan Pemerintah Republik Indonesia nomor 38 tahun 2007 tentang Pembagian Urusan Pemerintahan antara Pemerintah, Pemerintahan Daerah Provinsi, dan Pemerintahan Daerah Kabupaten.

Pemerintah Indonesia (2005). Peraturan Pemerintah Republik Indonesia nomor 19 tahun 2005 tentang Standar Nasional Pendidikan.

Pemerintah Indonesia (2005). Undang-Undang Republik Indonesia nomor 14 tahun 2005 tentang Guru dan Dosen.

Pemerintah Indonesia (2003). Undang-Undang Republik Indonesia nomor 20 tahun 2003 tentang Sistem Pendidikan Nasional.

Pemerintah Indonesia (2002). Keputusan Menteri Dalam Negeri nomor 29 tahun 2002 tentang Pedoman Pengurusan, Pertanggungjawaban dan Pengawasan Keuangan dan Belanja Daerah, Pelaksanaan Tata Usaha Keuangan Daerah dan Penyusunan Perhitungan Anggaran Pendapatan dan Belanja Daerah.

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