Simplifying Subnational Governments’ Key Performance Indicators, Creating A More Objective And Accurate Annual Evaluation

The atmosphere of the workshop on finalizing the draft on simplification of key performance indicators for the provincial government from the back of the room, there were four men and one woman sitting in a row at the front of the room.

To ensure that the performances of the Subnational Governments are monitored and evaluated, the Government of Indonesia, through Directorate General of Regional Autonomy (DGRA) of the Ministry of Home Affairs (MOHA), established an annual performance evaluation system called the EPPD (Evaluasi Penyelenggaraan Pemerintahan Daerah).

However, there are several issues about the EPPD implementation. First, the system includes a lot of key performance indicators (KPIs) that creates a burden for subnational governments to report. The existing EPPD includes not less than 221 KPIs and 209 KPIs need to be reported by the provincial and local governments, respectively. Second, DGRA of MOHA has limited capacity to verify and validate the report submitted by the subnational governments, including by crosschecking it with other databases maintained by other central government ministries/agencies.

A well-functioning EPPD is vital in ensuring that Indonesia meets its decentralization objectives. In addition to linking the results with the incentive system that the government has planned by providing Subnational Incentive Fund since 2020, EPPD results can also be used as the basis for capacity development programming based on specific needs of the subnational governments. Furthermore, the result of EPPD can inform policy making, planning, and budgeting at both national and local levels.

USAID ERAT has been working intensively with DGRA-MOHA since late 2022 to make EPPD more objective and accurate. First, USAID ERAT verified and validated the data submitted by the subnational governments for the previous EPPD since the data had never been verified or validated before. Second, USAID ERAT advocates to classify each province, city, and regency based on their fiscal capacity. Third, USAID ERAT facilitated several workshops with subnational governments to give them a chance to increase their participation and input on the KPIs. Fourth, to simplify and reduce the number of KPIs in EPPD. Lastly, to synchronize the data source used for EPPD with macro data provided by the Central Statistical Agency and the Data and Information Center of MOHA.

One of the most notable achievements from USAID ERAT’s work with DGRA-MOHA is reducing KPIs in EPPD from 221 to 116 for provincial level and from 209 to 155 for district level, which will immensely reduce the burden of the subnational governments. This was achieved after conducting three workshops with all 32 central government’s ministries and agencies that are involved with subnational government work and another workshop with 38 provincial governments in attendance. After all, it will be better to have fewer KPIs for the annual evaluation as long it is efficient, objective, and accurate.

The new key performance indicators will be legalized through a Minister of Home Affairs Regulation and will be used as the basis for the 2024 EPPD. USAID ERAT will continue supporting DGRA-MOHA in refining the EPPD for better subnational government reporting and evaluation quality.

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