The IRSA 11th
International Conference 2012 – “Natural Resources, Environment and People's
Welfare in Decentralized Indonesia”
FISCAL
DECENTRALIZATION TOWARD EQUALITY AND OUTONOMY OF DEVELOPMENT IN REGENCY OF
NORTH MALUKU
Chairullah Amin
(The Faculty of Economics, Khairun University)
Muhammad Asril Arilaha
(The Faculty of Economics, Khairun University)
Background
Success of adevelopmentof a regioncan be
seenfromseveraleconomic indicatorssuch asincome levelsare large, capital
flows increased investment sector followed by high employment, declining unemployment which ultimately lead
to the reduction of poverty. In the financial aspect, the success ofregional development can be measured bythe extent ofthe
areacapable of independent fiscal policy to meet all its construction needs.The large number of financial needs in the form of
fiscal spending to make each area of seeking to cover the lack of financing
sources in the form of regional income
or other revenue sources.
In addition fiscal independence, achievement of the
success of a regional post-decentralization is the extent of development
inequality index can be decreased, especially the fiscal imbalance between the
districts within a region. Fiscal imbalance is likely to occur due to differences
in potency against the backdrop of natural resources and human resources areas
owned.In this case, the area is rich with natural resources have a good clear
in an increase in local revenue sources compared to the poorer areas of natural
resources.So that the efforts of fiscal equalization is essential to reduce the
level of inequality in the development of financing fiscal management aspects
of an area.
Fiscal Decentralization
Fiscal decentralization is defined as the delegation
of authority in the field of revenue previously centralized both administration and utilization that organized and conducted by the
Central Government. With the delegation of some powers of the sources of state revenues to the
government in the area that it expected to be able to perform
routine tasks, public services and increase productive investment in the
region.
Davey (1988) identifies several reasons that insisted on the
importance of fiscal decentralization.Firstly, the increasing demands of public
service that can reach all parts of isolated that can only be conducted by
local governments.Secondly, the dissemination of ideas of community service such as programs provision of basic needs has gained more attention of the international
community.Thirdly, demand decentralization is also based on
consideration of the expected benefits of regional planning that is based on
observation, research and local policy.
In Law of Number. 33/2004, fiscal
decentralization implemented
in the form of fiscal balance between central and local government that is a
fair system of financial distribution, proportional, democratic, transparent,
and efficient in order to fund the decentralization, taking into
account the potential, conditions, and regional needs as well as the amount of
funding the implementation of deconcentration and assistance task.Fiscal balance between central and
local government as one state finance subsystem is divisionof tasks concequently between central and local
governments.Therefore, giving of state financial resources to local governments based
on the transfer task by the central government to local governments that respect to stability and fiscal
balance of a comprehensive system in funding of decentralization,
deconcentration and assistance task.
The concept of autonomy
Fiscal decentralization creates consequences for local
governments to both self-financing system and in determining the direction of
its expenditures in accordance with the priorities and interests of local
communities.In other hand, the area required to be able to identify their own
needs and then meet them with capabilities owned.Thus the
region is able to finance its spending needs by its fiscal capacity that it guarantee the existence of fiscal
sustainability.
Slack and Bird (2004) argues that fiscal autonomy is
the concept that good to hear but do not yet have clear limits what the true
sense.Bird (2003) mentioned the concept of autonomy as well as the concept of
balanced budgets more closely as art rather than science.In this case, the
meaning and intent of autonomy depends on the interests and who uses and also the availability of any measurement
data.
According to Ebel (2002), the indicators used in
research in several countries on the level of more fiscal autonomy based on the
analysis of the structure of local government revenues and
expenditures.Although it is recognized that the contribution of local
government revenue to total revenue, expenditure, and gross domestic product is not an sufficient sizebut it is still limited to the data that
can be obtained.Therefore, the ratio of fiscal decentralization among countries
is difficult to dobecause of the difficulty of data aggregation as well as
differences in the understanding of public sector decentralization.
Some interpretations of fiscal autonomy proposed by
Slack and Bird (2004).First, it simply means that the government's fiscal
autonomy can finance all
expenditures with own revenues without relying on transfers and loans.The
second is structurally identical to the first but different substancenamely
that the government can cover the expenses of its
operationswith its routine
revenue beyond transfer.The
third understanding covers all expenses including the investment by the fund
from its own revenues, transfers and loans.
Meanwhile, the fiscal autonomy of local governments in
Indonesia can be seen from the large contribution revenue and revenue-sharing
to total local revenues. Ideally the area will be independent if no longer
receive their share which is the philosophy of administration to address the
fiscal gap caused by the difference in the fiscal needs and fiscal kapaitas
area.
On the expenditure side, the region's autonomy can be
seen from how much the ability of local governments in allocating development
expenditure or investment is actually acting as an accelerator of economic
growth and increased prosperity. Capital expenditures that are used for infrastructure
development will facilitate the entry of investment which in turn will have a
positive effect on regional economic growth and higher social welfare
The Concept of Equity
Perspective
ofequity infiscaldecentralizationoppositeofthe relationshipbetweenfinancial
transfersto thereduction ofregional disparities.Although the definition limits of the gap is still vague, for while
regional disparities is perceived as differences in income per capita, the
level of regional economic growth, unemployment and other economic variables
from one region to another (Musgrave, 1989).In this regard fiscal
decentralization policy became an instrument in order to achieve the equalization of
fiscal capacity among regions.Even though the policy of fiscal decentralization is
not always sensitive and objective for it to reduce regional disparities, but the reality it is much adopted of many countries.It
is therefore understandable that an important indicator in determining the
formula of financial equalization formula to reduce disparities between regions
is to use income per capita.
The policy thinking of fiscal
decentralization in this perspective distribution has at
least two justifications (Bird, 2003). First, fiscal decentralization is an instrument to equalize
fiscal capacity between the regions.Second, fiscal decentralization serves to
provide adequate funding for local governments in order to give basic
services.Further proposed equalization can also be understood as an
interpersonal equity, namely the creation of a condition where no longer found
to the imbalance in the structure of society
Developing of the Local Government Financial ofDistrict and Town in North Maluku.
Developmental role of local government in driving
economic growth, among others, can be seen from the implementation of local
fiscal policies embodied in the realization of the regionalbudget.As one policy instrument, the
realization of the budget is basically an implementation of finance plan that includes government expenditure
and receipts that have been done that used to cover these expenses within a
certain period of usually one year.Therefore, the implementation of government
financial authority in implementing government affairs and public service is
reflected in it. So that the
development of local government's financial performance can be seen by
analyzing the elements contained in the structure of the realization of the
Regional Budget.
The finance development of the district-city in North Maluku can be seen in
Table 2. Generally during the period of fiscal year
2005 to 2009, the budget realization of districts- cities in North Maluku has been progressing very insatisfactorily.Although it has increased in quantity, but it’schange is not too large.
Table 1. Realization of Receipts and Expenditures of All Districts-Cities in North Maluku 2006 - 2009
(Trillion Rupiah)
Year
|
Income
|
Expenditures
|
Increase (%)
|
|
Income
|
Expenditures
|
|||
2006
|
2.204.364.570.305
|
2.005.284.731.241
|
-
|
-
|
2007
|
2.870.174.035.732
|
2.687.607.840.732
|
30.2
|
34.02
|
2008
|
3.178.827.837.054
|
3.293.395.315.938
|
10.75
|
22.54
|
2009
|
3.181.021.786.819
|
3.345.173.728.872
|
0.07
|
1.57
|
Source : BPK (Data Processed)
In fiscal year 2007, revenue district-city in North Maluku increased
dramatically by 30.2% to Rp 2.870.174.035.732.00.This is caused by the receipt of revenues
overall significant increase in the previous year.So in general almost all the
districts / cities in Indonesia has increased the revenue budget respectively.
Since the implementation of fiscal decentralization,
revenue of district -city in North Maluku for the last
five years tend to be volatile.For 2006, total revenues ofall district-city increased by Rp
2,204,364,570,305.This increase was strongly influenced by the growing
percentage of revenue allocationof balance fund in the budget of financial statements of the district-city in North Maluku.Considering the
high dependence of local revenue allocations from the
central budget.Evenfor 2007 revenue district-city increased by30.2% or up to Rp 2.870.174.035.732,00, while for 2008 and 2009 increased
by 10.75% and 0.07%.
Since the implementation of fiscal decentralization in
the last four years, it was a very drastic increase in the
amount of revenue of the district-city in
North Maluku.Total revenue continued to increase, amounting to Rp 2.204.364.570.305 in 2006 rose in 2009 to Rp 3.181.021.786.819, or 44.3%.Although was slowdown in 2009 whrere is only increased by 0.07% from the
previous year. Thus for the
four years 2006-2009, the average of budget
revenue of district-city of North Malukureached to 10.25%.
While from the side expenditure, during the same
period, government
spending was progressing
quite well.In fiscal year 2006/2007, the limited revenue that can be assembled
to force local government to tighten up and optimization of expenses.It can be
seen from government spending in 2006 which was only Rp 2.005.284.731.241.
As for the fiscal year 2007, government expenditure
increased dramatically by 34.02% or up to Rp 2.687.607.840.732.This occurs due to an increase
in government revenue of district-city at the same time.Increase of the same timewas in 2008 rose to Rp 3.293.395.315.938, or by 22.54%. However, for the
year 2009 experienced a slowdown in government spending by 1.57% or only Rp 3.345.173.728.872.Thus, during the last four
fiscal year of period in
fiscal decentralization, the average increase in the expenditure of district-city in North Maluku at 14.53%.
The Role of LocalRevenue as a Source of Local Income
Local revenue is an income gained from local sources within
its own territory and self managed.As a source of local acceptance from own
revenue is expected to be a source of financing and construction of important
areas.But in reality, the role of PAD as a source of revenue for local
governments or
municipalities in Indonesia is still far from expected.
The role of local revenue as a source of local revenue can be
measured by the percentage of total acceptance. The higher the percentage, the greater role of local revenue as a source of acceptance and the higher potential of the area to achieve
self-sufficiency.
The
development of local revenue as a source
of local income for the
district and city in
North Maluku shown in the following table.
Table 2. PercentageOf Local Revenue Role ofDistrict-City
In North Maluku2006-2009
District/Year
|
Role Of PAD
(%)
|
Total of
|
|||||
2006
|
2007
|
2008
|
2009
|
Average
|
Level
|
Average
|
|
Halsel
|
5.65
|
5.95
|
8.81
|
5
|
6.35
|
Top
|
6.05
|
Haltim
|
10.41
|
1.08
|
6.11
|
7.77
|
6.34
|
Top
|
|
Ternate
|
5.72
|
5.36
|
5.73
|
5.04
|
5.46
|
Top
|
|
Halut
|
2.17
|
3.93
|
4.72
|
3.66
|
3.62
|
Middle
|
3.36
|
Sula
|
0.63
|
1.7
|
9.5
|
2.45
|
3.57
|
Middle
|
|
Halteng
|
2.2
|
2.79
|
3.55
|
2.95
|
2.87
|
Middle
|
|
Tidore
|
2.17
|
2.54
|
2.68
|
2.75
|
2.54
|
Bottom
|
1.95
|
Halbar
|
1.62
|
1.63
|
0.99
|
1.16
|
1.35
|
Bottom
|
|
Average
Total
|
3.91
|
3.23
|
5.54
|
3.97
|
4.16
|
||
Source : BPK (processed data)
In this table appears that during the period 2006 to
2009, the role of local revenue in the
district or city in
North Maluku on average of the lowest is 1.35% inHalbar and most of the Halsel is 6.35%.As for the district of Haltim and Ternate, each is 6.34% and 5.46% so it can be
concluded that Halsel, Haltim and Ternate arethe districts with the average percentage of the greatest
role of local revenue in North
Maluku.Halteng, Halut and Sula Islands particularly have an average percentage of 3.62%,
3:57% and 2.87%, so the third areasare classified as the class that contributes to PAD in North Maluku. Halbar and the Tidore Islands arethe districts with the smallest percentage of the
role of PAD which averaged only 1.35% and 2:54%.
The role of local revenueis much supported by a number of areas
that are in top class consisting of Halsel, Haltim and Ternate.As shown
in the chart above for 4-year budget that was observed, the PAD in the third grade of this area contributes to 6.05% of total acceptance or 2.70%
higher than the average of the role of PAD in areas that are in the middle
class.While the two districtare located in the lower class consisting of TidoreandHalbar contribute to an average of only 1.95% of total
revenue or 1.41% below the average of district in the middle class.
The gap between the classroom and the development average of the role of The PAD as a source
of local revenue each fiscal year is more clearly shown in the chart below.
Of developments during the last 4 years, it appears that since the decentralization of the fiscal from 2006 to 2009, the role of The PAD as a source of revenue contributed to the district-city in North Maluku is still extremelylow. In Table 3above it appears that during the period 2006 to 2009, the role of The PAD in the district in North Maluku, on average is only about 4.16%.On average of The PAD role is fluctuating changes in 2006 is from 3.91% down to 3.23% in 2007 and then rose to 5.54% in 2008, but declined again in 2009to 3.97%.This suggests that over the last four years the implementation of fiscal decentralization policy, the independence of district-city in North Maluku tends to decrease.
This tendency is reinforced by Williamson inequality
index from year to year as shown in chart 3 below. From the graph it can be
seen that in fiscal year 2006, equalization role of The PAD as a source of revenue
for district-cities in
North Maluku is very lame with an index value of 0.68.In this period, the percentage of the highest role
of The PAD is Haltim district that is equal to 32.71%, while the Sula District
is the lowest at only 2.07%.This disparity has not changed in the year 2007 ie
0.62. But in 2008,
declining inequality index which is equal to 0.20 and in 2009, the index inequality increased
again, reaching to 0.65. This
indicates that fiscal decentralization in North Maluku has not succeeded in
reducing income disparity among districts.
Role of local revenue and Profit Sharing Funds as a Source of Revenue
The local revenue(PAD) as a source of local income that comes from its own area to measure the degree of
local independence considered incomplete.In addition toThe PAD, Profit
Sharing Funds(DBH), which is the state budget
fundsallocatedto the regionswitha certainpercentagecould alsobe
usedtomeasure the degree oflocalautonomy.In this case
the proportion of the amount transferred to the regions arranged in a certain
percentage of funds that had collected from the area.Thus the size of Profit
Sharing Funds obtained by an area determined by the amount of taxes and other
revenue sources that have been collected from the area.
Areas that are relatively already advanced and more
independent than other areas in general have a higher profit sharing
funds. ByConsidering
the determination of the acquisition of it is determined by the potential of the region,its role as a source of local revenue
can be used in measuring the degree of fiscal autonomy of a region besides the
local revenue. Hence
thelevel of regional independence could be
measuredby how the role of
local revenue andprofit sharing
funds knownas fiscal
capacity to be a source of
local income.
The development of local revenue and profitsharing
funds (PSF) as the source of income for the district-city in North Maluku shown in the
table below.
Table 3. Percentageof Role of Local RevenueAndProfit Sharing Funds
District / City 2006 – 2009 in North Maluku
District/Year
|
Percentage ofPAD
& DBH Role (%)
|
Total
|
|||||
2006
|
2007
|
2008
|
2009
|
Rata-rata
|
Level
|
Average
|
|
Halbar
|
96.15
|
16.11
|
12.38
|
11.05
|
33.92
|
Top
|
23.67
|
Halsel
|
7.48
|
27.76
|
20.78
|
15.28
|
17.82
|
Top
|
|
Haltim
|
10.62
|
13.28
|
27.6
|
25.6
|
19.27
|
Top
|
|
Ternate
|
11.33
|
20.74
|
16.92
|
15.33
|
16.12
|
Middle
|
15.77
|
Halut
|
4.44
|
23.5
|
19.4
|
17.14
|
16.08
|
Middle
|
|
Halteng
|
7.13
|
20.19
|
18.44
|
14.63
|
15.1
|
Middle
|
|
Kep.Sula
|
6.73
|
13.90
|
18.02
|
13.58
|
13.06
|
Bottom
|
12.69
|
Tidore
|
5.74
|
16.08
|
14.53
|
12.88
|
12.31
|
Bottom
|
|
Total
|
149.62
|
151.56
|
148.07
|
125.49
|
143.68
|
||
Average
|
18.70
|
18.95
|
18.51
|
15.69
|
17.96
|
||
Source : BPK (Processed Data)
In addition, fromFigure 4looksdisparitybetween leveland the
averageof development
ofThe PADandDBHroleas a source oflocal revenueeachfiscal yearis not toolarge.Three areas incoming upscale was just above average, while areas that
are in the middle class and lower class is below average.This means that the rate of The PAD and
the DBH role that an
average of 15.69% ismany contributed by the areas in the upper class such as Halbar, Halsel and Haltim.
During 4 year of fiscal observed, The “PAD” and “DBH” at three upscale area sare on average 23.67% give the
role of total revenue or 5.71% higher than the average of the role of The PAD and DBH. While
the two district-cities
located in the lower class consisting of Kep. Sula and Tidore, The PAD and DBH are only accounted for an average of
12.69% of total revenue or 5.28% that below the average of district in the
middle class.This suggests that the strength of The PAD and DBH as a source of
revenue is more concentrated in the district in the top class.
These numbers show that although tends to reduce the
role of The PAD and DBH,but fiscal decentralization tends to reduce the gap
between the classes in the district in North Maluku in terms of the role of The
PAD and DBH as a source of revenue.This is evidenced by Williamson disparity
index calculation for 4 years of observation as shown in chart 5 below
From this graph appears that in fiscal year 2006, inequality index of the PAD and DBH role as a source of revenue district in North Maluku is very significant, amounting to 0.67 in 2006, then fell to 0.65 in 2008 and 2009. This result shows that the disparity between districts in North Maluku by the PAD and profitsharing funds is quite high, it is at an average of 0.65. So it can be concluded that during the four years of fiscal decentralization, thedisparity of roleof the the PAD and DBH in North Maluku is still quite large.
Regional capability for Removing Dependency On
Subsidies and Assistance of General
Allocation Fund
Before the era of fiscal decentralization, local
autonomy can be seen from the amount of subsidy and revenue received from the central
government. Allocation of funds to local governments was done through the
Regional Routine Fundin the form of subsidies of the Autonomous Region and Regional Development Fund in the form of development assistance known as Presidential
InstructionProjects. Both of
these types of assistance are more specific teoristis given its use has been
directed to achieve specific goals.While the amount of assistance provided
varies depending on the purpose and intended use of the aid.However, most of
the discretion is based on the needs and potential fiscal owned by the region
such as area, population factors, The PAD, GDP and so on.
Currently,
theindependenceof a regioncan be observedfromthe size ofthe General Allocation
Fund(DAU)
as a source oflocal revenue.General Allocation Fund is a fund
that comes from the state budget revenues are allocated to the equalization of
fiscal capacity to fund its needs in the context of decentralization.The
purposeof thisequalizationis achievedbydetermining the amount oflocal revenue thatperformedby
usingthe concept ofthe fiscalgap.In this concept GAF needs of a region is determined
based on the difference between fiscal needs and fiscal potential of an area
called the fiscal gap.The larger fiscal gap of an area, the greater the
acquisition of GAF to be received. It means that the area is increasingly dependent
on central government.
In order to achieve the independence, the area should be
able to get away from dependence on funding from central government.In fact,
the role of this fund for district in North Maluku is still dominant. During fiscal year 2006 to 2009, the
role of thisfund by an
average of 58.72%.This dependence even for an average of 58.69% in the district
located on the lower classes that district Halbar and Tidore.Similarly,districtor city located
in theupscaledependenceof about60.76%.While for areas that are on the middle class of this
dependence by an average of 56.71%.
The highest rise of dependence on local revenue occurred
in cities that occupy in the lower classes.In a four-year observation period in fiscal
decentralization, districts or cities that are in this level areHalbar and Tidorehave increased from 41.09% in 2006 rose
to 63.84% in 2009.While cities located on the middle class have increased from 46.75% to 54.63%.
More detail
can be seen in Table 5 below. It can be observed that the dependence
on central government funds are more concentrated in the upper-class areas.
Table4. Percentage ofGeneral Alocation Fund ToRevenueof Districts
In North Maluku, 2006 – 2009
District/Year
|
Percentage of Role of GAF (%)
|
Total
|
|||||
2006
|
2007
|
2008
|
2009
|
Average
|
Level
|
Average
|
|
Halsel
|
75.28
|
57.86
|
62.03
|
68.28
|
65.86
|
Top
|
60.76
|
Haltim
|
61.58
|
50.75
|
47.71
|
47.38
|
44.84
|
Top
|
|
Ternate
|
69.02
|
71.19
|
61.03
|
57.05
|
64.57
|
Top
|
|
Halut
|
3.81
|
62.03
|
66.42
|
47.11
|
51.85
|
Middle
|
56.71
|
Halteng
|
65.59
|
59.41
|
60
|
60.42
|
61.35
|
Middle
|
|
Sula
|
70.85
|
68.18
|
60.29
|
56.36
|
63.92
|
Middle
|
|
Halbar
|
68.37
|
61.27
|
61.36
|
61.01
|
63
|
Bottom
|
58.69
|
Tidore
|
13.8
|
68.64
|
68.38
|
66.67
|
54.37
|
Bottom
|
|
Total
|
428.3
|
499.33
|
487.22
|
464.28
|
469.76
|
||
Average
|
53.54
|
62.42
|
60.90
|
58.04
|
58.72
|
||
Source : BPK (data Processed)
The high
dependence of the area of budget funds in the decentralization era from the center government showed that the low rate of
autonomy of districts or cities in North Maluku in financing the fiscal capacity. It is endorsed by the Williamson index
indicating the large of the
disparity that occurs due to the high dependence on central government funding. From four years of observation, 2006 to 2009, the average index
value of Williamson is 0.65. It means that fiscal decentralization
has no impacted on fiscal
equalization between districts or cities in North Maluku.It is strongly affected due to
lower revenue and the large dependence of the central of revenue sharing and
general allocation of funds that has increased from year to year.
The Ability of LocalRevenue to FinanceTheRoutineExpenditure
The measurement of a region capable of autonomy is
the ability inmanaging and financing the affairs of government. In this case the Revenue should be
the main source of revenue in order to cover minimum requirement to maintain a
life that has been achieved today.The level of local independence is measured
by calculating the percentage ratio of local revenue to operating expenses and
maintenance in the past known as routine expenditures.In this context, the region can be called independent if
the ratio of local revenue to expenditures reached 100%.
Infact,the ratio oflocal revenue to routine expenditures in cities in North Maluku only reached an average
of4:03% .Table 6
below shows the percentage oflocal revenue to routine expenditure ratio for 4-year observations in 8 districts and cities
in North Maluku. From the tableit appears thatin 2006 has an average ofthis ratio reached 4.12%. In
the same period, some areas reached of this
ration such as Haltim of 10.94%, Halsel of 5.75%, and Ternate of 6.05%. But in some other areas such as
Halut, Halteng and Kep.Sula, percentage ratio of local revenue for routine
expenditure is only about 3.44%.
Table 5. Percentageof The Role of Local RevenuetoRoutine Expenditure
In North Maluku, 2006 – 2009
District/
Year
|
The
Role of PAD (%) toRoutine
Expenditure
|
Level
|
Total
|
|||||||
2006
|
2007
|
2008
|
2009
|
Total
|
Average
|
Average
|
||||
Halsel
|
5.75
|
6.9
|
8.17
|
4.88
|
25.69
|
6.42
|
Top
|
5.96
|
||
Haltim
|
10.94
|
1.34
|
6.32
|
5.95
|
24.55
|
6.14
|
Top
|
|||
Ternate
|
6.05
|
5.03
|
5.37
|
4.87
|
21.32
|
5.33
|
Top
|
|||
Halut
|
2.28
|
4.49
|
4.55
|
3.7
|
15.01
|
3.75
|
Middle
|
3.44
|
||
Kep. Sula
|
0.63
|
1.88
|
9.67
|
2.43
|
14.61
|
3.65
|
Middle
|
|||
Halteng
|
2.65
|
3.06
|
3.13
|
2.83
|
11.67
|
2.92
|
Middle
|
|||
Tidore
|
2.46
|
2.67
|
2.5
|
2.66
|
10.28
|
2.57
|
Bottom
|
2.03
|
||
Halbar
|
2.23
|
1.53
|
0.98
|
1.21
|
5.95
|
1.49
|
Bottom
|
|||
Total
|
32.99
|
26.9
|
40.69
|
28.53
|
129.07
|
32.27
|
||||
Average
|
4.12
|
3.36
|
5.09
|
3.57
|
16.13
|
4.03
|
||||
The local
revenue ratio of these expenditures on average continued to decline from 4.12%
in 2006 fell to 3.57% in 2009.The largest decrease occurred in the district who occupy the top six region in this ratio. They areHalsel, Haltim and Ternate which
fell from 7.58% to 5.23% or 2.35 points.Instead to middle-class areas has
increased slightly from 1.85% to 2.99% or 1.14 points.While the two districts
are located in the lower classes down from 2.35% in 2006 to 1.94% in 2009.local
revenue progression towards routine expenditure ratio is clearly visible on the
figure 8 below
From figure 8 looks a disparity between the classes and the growth average of local revenue rationto routine expenditure for each budget year. Three areas that enter top class are above average, while areas that are in the middle class and lower class are below average.This means that the rate of routine expenditure ratio of local revenue is more widely shared by the regions in the upper class namely Halsel, Haltim and Ternate.
During fiscal year observed, the ratio of the three
local revenue to routine expenditureon top class areasgive an average of 5.96% or 3.93%
higher than the average ratio of the areas that are the lower classes that are only 2 , 03%.While the three cities located in the middle class
consisting of Halut, Haltengand kep.Sula, their ratiosan average are 3.44%.This suggests that the ability of local revenue
to cover routine expenditure needsis more concentrated in the districts or cities in the region of the lower
classesand the ability of local revenue of districts or cities in North Maluku for routine expenditures tend
to decline since fiscal decentralization was implemented.
Besides decrease the ability of local revenue to
finance operating expenditure,Fiscal decentralization in fact has not
successful in reducing the gap between the classes of city in North Maluku in terms the abilityof local
revenue infinancingthe routine expenditure. It can be seen from the results of the
calculation of the index Williamson on the graph below.
Conclusion
Description of the above shows that fiscal
decentralization has not able to increase local fiscal autonomy but rather tend
to increase the dependence of regencyor city in North Maluku of the Central Government.It looked
from the decline in the role of local revenue as a source of local income, the decline of percentage
of local revenue and profit sharing
funds as a source
of local funding, the increased dependence ofgeneral
alocation fund and the
decreased ability to finance the local routine expenditure.
For the aspect of equity, fiscal decentralization
policy also has not reduced the gap between the district or city in North Maluku in terms of
the role of local revenue as a source of local income, as a regular source of financing,
the role of local revenue and the profit sharing funds, andthe Role of general
alocation funds.It looked
from the high value of the disparity of Williamson index on each of these
indicators.Besides, it also happens that the rate of decline of role was higher in the Districtsand Cities occupy in top classesthan in the lower classes.
Bibliography
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