"There must be anticipatory measures and clear strategies in place so that changes in fiscal transfers do not disrupt development programs or public services," he said in an official statement issued in Jakarta on Monday.
Tito delivered these remarks while addressing officials from the Ministry of Home Affairs (Kemendagri) during the 2026 Budget Work Plan (RKA) Consignment Meeting held in Bogor, West Java.
He urged officials at the Ministry of Home Affairs to enhance their supervisory and guidance roles toward local governments, noting that such oversight is crucial to ensure that national policies are effectively implemented at the regional level, particularly amid adjustments in fiscal transfers.
Tito also stated that he had coordinated with the Minister of Finance to ensure that any reallocation of fiscal transfers takes into account each region’s fiscal capacity. This is intended to ensure that local governments can still fulfill their statutory duties, including the provision of basic public services.
He outlined four key measures that regional governments should prioritize:
First, budget efficiency, particularly in expenditure areas such as official travel, meetings, and office infrastructure maintenance.
Second, identifying new sources of local revenue that do not burden lower-income communities. This may include taxes on heavy equipment, restaurant taxes, and groundwater extraction levies. Local governments are also encouraged to stimulate the private sector by easing business regulations and enhancing the performance of Regional-Owned Enterprises (BUMD), thereby maintaining fiscal sustainability.
Third, maximizing participation in national priority programs implemented in their respective regions. Tito noted that aligning with national agendas can strengthen local development efforts.
Fourth, encouraging innovation and creative breakthroughs tailored to each region’s unique potential.
As an example, he cited the Riau Islands Provincial Government’s (Kepri) initiative to open export channels for horticultural products to Singapore. This innovation, he said, has the dual benefit of stimulating the local economy while expanding access to international markets.
"Regions must be bold in seeking new breakthroughs that match their local potential. That way, even amid changing TKD dynamics, development can continue, and public welfare can improve," he added.
The consignment forum was designed to ensure that the Ministry’s 2026 work plan and budget are prepared comprehensively. Each department was given the opportunity to present achievements and resource needs, with the Minister conducting in-depth reviews to ensure alignment with central government policy directions.
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Translator: Fianda, Azis Kurmala
Editor: Primayanti
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