Draft Bill on Climate Change Proposed to Regulate Regional Funding Incentives

The regulation of funding incentives and disincentives is one of the proposals raised during discussions on the Draft Bill on Climate Change (“Draft Bill”). Jatna Supriatna, an expert from the University of Indonesia, proposed to Commission XII of Indonesia’s House of Representatives (DPR) that the Draft Bill expressly stipulate integration obligations, incentive reporting requirements, and accountability mechanisms.

“At present, there is no sectoral buy-in because funding incentives are not aligned with the targets,” Jatna said.

Jatna considers that, without funding support, human resource (“SDM”) capacity building, and clarity regarding the allocation of authority, Regional Action Plans (Rencana Aksi Daerah - “RAD”) risk becoming mere formal administrative documents. This could hinder the effective implementation of climate change mitigation and control policies at the regional level.

To address these issues, Jatna proposed that the Draft Bill on Climate Change include provisions on climate budget tagging, climate performance-based budget allocations, and access to climate funds as incentives for achieving targets. The Draft Bill should also establish obligations concerning integration and incentive reporting, together with accountability mechanisms and the provision of incentives and disincentives to regional governments, to ensure that climate action implementation is supported by adequate and measurable funding.