Analysis of Financial Performance of Newly Created Regencies/Cities in North Sumatera

This research attempts to analyze the implementation of the regional autonomy in the newly-created regencies/cities in North Sumatra. It focuses on the financial performance of the original regional income (PAD) after the fiscal decentralization and the regional financial independence. The result shows that the regional autonomy has a positive impact on the growth of the PAD. However, the share of the PAD in regional budget is still inadequately small. The newly-created regencies/cities in North Sumatra are not ready to face the regional autonomy policy. Most of the newly-created regencies/municipalities are dependent on the balancing fund through the General Allocation Fund (DAU) and the Special Allocation Fund (DAK).Keywords: regional autonomy, original regional income, fiscal decentralization