I Made Arie Widyasthana Wartana Putra, Dwi Suharnoko, Faradian Salsabila, Dina Dwi Utami Putri

Implementation of Fiscal Decentralization in the Digital Era: Effectiveness and Challenges in Indonesia

Introduction

Implementation of fiscal decentralization in the digital era: effectiveness and challenges in indonesia. Evaluate fiscal decentralization's effectiveness and challenges in Indonesia's digital era. Covers improved transparency & efficiency, and issues like digital infrastructure and human capacity.

Abstract

Fiscal decentralization in the digital era brings new opportunities and challenges for its effectiveness in Indonesia. This article aims to analyze the implementation of fiscal decentralization in the digital context, evaluate its effectiveness, and identify the challenges faced. The methodology used includes a literature review and secondary data analysis. The research findings indicate that implementing fiscal decentralization in the digital era can enhance effectiveness in several aspects, such as financial transparency and accountability, efficiency in regional financial management, and increased public participation. However, this implementation also faces several challenges, including disparities in digital infrastructure between regions, limited human resource capacity in the areas, and insufficient regulations supporting the implementation of fiscal decentralization in the digital era. Therefore, although budgetary decentralization in the digital era holds significant potential to improve the effectiveness of regional financial management, serious efforts are needed to address these challenges. This includes investment in digital infrastructure, enhancement of human resource capacity, and the development of regulations that support the practical and safe application of technology.

Review

This article addresses a highly relevant and timely topic: the implementation of fiscal decentralization in Indonesia within the rapidly evolving digital era. The research aims to analyze the current state, evaluate effectiveness, and identify key challenges, offering valuable insights into a critical aspect of public administration and governance. Utilizing a methodology that combines literature review and secondary data analysis, the paper effectively highlights several potential benefits of digital integration in fiscal decentralization. These include significant enhancements in financial transparency and accountability, improved efficiency in regional financial management, and a promising increase in public participation, all of which are crucial for effective decentralized governance. While acknowledging the substantial potential, the study provides a balanced perspective by thoroughly outlining the significant hurdles impeding optimal implementation. The identified challenges — disparities in digital infrastructure across regions, limitations in human resource capacity at the local level, and the inadequacy of existing regulatory frameworks — are indeed critical issues that demand serious attention. The abstract strongly implies that without concerted efforts to overcome these structural and human capital deficits, the promised benefits of digital fiscal decentralization may remain largely unrealized. This nuanced presentation underscores the complexity of policy implementation in a diverse and digitally unequal nation like Indonesia. In conclusion, this article offers a compelling preliminary assessment of a vital policy area, providing a solid foundation for further discussion and action. Its findings underscore that while the digital era presents transformative opportunities for improving regional financial management, realizing this potential is contingent upon strategic investments in foundational elements such as digital infrastructure and human capital development, alongside the creation of robust and adaptive regulatory environments. The paper's call for serious efforts in these areas is well-justified and provides clear directions for policymakers and future research, making a significant contribution to understanding the nexus of governance, technology, and development in Indonesia.

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