The implementation of Law No. 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments (HKPD Law) is considered ineffective in reducing inter-regional fiscal disparities. Deputy Speaker of the Regional Representative Council (DPD RI), Yorrys Raweyai, highlighted the shrinking fiscal space for regions due to the reduction in Transfers to Regions (TKD) from the State Budget (APBN), which was exacerbated by a 50 percent cut in Revenue Sharing Funds (DBH) through Law No. 17 of 2025 concerning the 2026 State Budget. The DPD RI Public Hearing (RDPU) discussing fiscal decentralization and equitable Revenue Sharing Funds (DBH) was held on June 3, 2026, in Senayan, Jakarta.
APEKSI, through its Board Secretary/Executive Director, Alwis Rustam, provided concrete recommendations, along with experts, to overhaul the fiscal decentralization formula to make it more proportional. This restructuring is considered urgent so that regions can become independent, free from dependence on central transfers, and optimize public services equitably.