Home Affairs Minister Allocates Rp 1 Trillion for 'Carrot' to High-Performing Regions
Home Affairs Minister Muhammad Tito Karnavian has reaffirmed the central government’s commitment to providing tangible appreciation to local governments demonstrating top performance. The Ministry of Home Affairs has allocated a budget of Rp 1 trillion specifically as fiscal incentives for high-performing regions.
In his speech at the 2026 Appreciation for High-Performing Local Governments event, Tito likened the regional guidance approach to the ‘stick and carrot’ method. “For the past five years as Home Affairs Minister, I’ve thought we’ve only been using the stick, meaning just reprimanding and controlling. Now, where’s the carrot? Where’s the reward?” Tito said to the governors and regents/mayors at the Platinum Hotel in Balikpapan on Tuesday, 5 May 2026.
Home Affairs Minister Tito explained that the increase in the ministry’s 2026 budget presents an opportunity to reward regions. He described the Rp 1 trillion fund as a ‘windfall’ that must be redistributed to regions performing exceptionally.
“I don’t want to just reprimand. If we provide incentives, there will certainly be a sense of happiness and greater enthusiasm among regional heads,” he said.
To ensure fairness in incentive distribution, the Ministry of Home Affairs is developing various regional ranking indices. These indices cover sectors from inflation control and poverty handling to ease of doing business.
Tito emphasised that the data used is objective, involving the Central Statistics Agency (BPS) and related ministries/institutions without intervention. The rankings will be released publicly. “If the indices are high for all, that region will become a favourite for investors and businesses. Even politically, this can boost the electability of Mr/Ms regional heads,” he said.
The good news does not stop there. The Home Affairs Minister revealed that next year’s ministry budget is predicted to increase again. Therefore, he has instructed the ministry’s Secretary General’s staff to raise the allocation for fiscal incentives to high-performing local governments.
“So that regional head colleagues are even more enthusiastic in working. This is a form of national appreciation for your hard work in your respective regions,” he said.
On that occasion, Tito also praised the unity of leaders on Borneo Island. “I feel delighted tonight; fellow governors across Kalimantan can sit at one table. This is extraordinary,” he said.
The Ministry of Home Affairs is responsible for boosting performance, motivating, and encouraging regional heads to perform better and carry out their duties well. For this reason, the ministry held the 2026 Appreciation for High-Performing Local Governments.
In its implementation, this competition is not held uniformly; the ministry opts for a regional approach. The event is divided into several waves, covering Sumatra, Kalimantan, Java-Bali, Sulawesi, Maluku-Nusa Tenggara, and Papua.
On 25 April 2026, the appreciation for the Sumatra region was held in Palembang, South Sumatra. Now, it is Kalimantan’s turn to hold the same event.
A total of 24 local governments received appreciation in Borneo. For the Unemployment Rate Reduction category, there is one province, three regencies, and two cities that received appreciation. The same applies to the Poverty Alleviation and Stunting Reduction categories, Creative Financing/Entrepreneurial Government, and Inflation Control. Meanwhile, provinces, regencies, and cities receive fiscal incentives of Rp 3 billion for first place, Rp 2 billion for second place, and Rp 1 billion for third place.