Green Budgeting in Regional Development: Analysis of Efficiency, Effectiveness, and Identification of Budgeting Constraints in Semarang City

Abstract

The increasingly complex environmental issues in Semarang City, such as flooding, tidal flooding, land degradation, water pollution, low green open space, and the Environmental Quality Index (IKLH) always in the moderate category, require adaptive and sustainability-oriented fiscal policies. This study aims to analyze the direction of green budgeting policies in Semarang City, identify trends in environmental sector budget allocations for 2021–2024, measure the level of efficiency and effectiveness of its use, and examine the constraints in determining budget allocations. The research approach uses mixed methods, with quantitative analysis through Data Envelopment Analysis (DEA) to measure efficiency and Cost Effectiveness Analysis (CEA) to measure effectiveness, as well as qualitative analysis for policy review through interviews with relevant agencies. The results of the study show the integration between macro policies (floods, water, transportation, spatial planning, agriculture, fisheries, and waste) and micro policies (sub-districts, villages, education, and community participation). Fiscally, budget allocation shows an upward trend from IDR 647.40 billion in 2021 to IDR 757.19 billion in 2024. The efficiency value of the DEA results is fluctuating but tends to increase from 0.83 (2022) to 0.85 (2024). The CEA results also show an improving pattern of effectiveness in 2023-2024, marked by an increase in the Environmental Quality Index (IKLH) from 51.32 (2022) to 59.41 (2024). The main obstacles to determining the budget allocation for the environmental sector include fiscal constraints, technical constraints, regulatory constraints, and political constraints. Therefore, strategic measures are needed, such as the implementation of local green tagging, the prioritization of environmental issues in development, the strengthening of community participation, the optimization of innovative financing, and the implementation of performance-based budgeting to achieve sustainability in the city of Semarang.