Based on the fact that many regions are still less effective in managing their regional local budgets, for example, the budget for employee expenditure reaches 37 percent, while the budget for capital expenditure only covers 20 percent. In addition, many regions have not implemented mandatory budgets in accordance with existing laws, such as 20 percent for the education budget or 10 percent for the health budget.
The creation of Indeks Kelola is intended to encourage the regional government in managing the regional local budget (APBD) in an effective manner, particularly in the fields of education, health, welfare and economic growth. To boost competition amongst regional governments in managing an effective regional budget, Katadata Insight Center (KIC) held an awarding night for the intention of giving appreciation to the regional governments that have successfully managing the regional budget, as the report will be published in annual basis.
To ensure the independency in designing the research activities and methodologies, an independent expert team assisted Katadata Insight Center (KIC) and Jari Ungu, in the preparation of the research methodologies and indices/indicators.