Local Development Planning and Budgeting in Decentralized Indonesia : Missing Links in the Bottom-up Approach

This paper focuses on the workings of Indonesia\u27s local development planning and budgeting mechanisms after decentralization, where citizen participation becomes a central theme for all stakeholders including policy makers. If real local needs are to be articulated, bottom-up mechanisms needs to be strengthened through its institutionalization in local government structures. At the same time, it can not be overlooked that effective and efficient local planning and budgeting in decentralized administration structure much requires good coordination between higher and lower levels of government (vertical linkages), and between neighboring local governments (horizontal linkages). Indonesia needs to make the best strategic use of matching or earmarked grant to link development plans and budgets at all levels of government. For horizontal linkage, role of provincial governments need to be enhanced to set up a formal coordination system