Jakarta – In commemoration of World Environment Day, observed annually on 5 June, the Civil Society Coalition for Ecological Financing, together with the Nusantara Pillar Association (PINUS) as the Secretariat of the Regional Green Parliament Caucus (KPHD), held the KPHD National Workshop on 3–4 June 2026 in Jakarta. The event, themed “Strengthening Regional Voices for Ecological Justice and Regional Fiscal Justice,” brought together dozens of regional legislative council (DPRD) members from across Indonesia.
Speaking as the keynote speaker in the session “Ecology-Based Fiscal Reform and Governance of the Extractive Sector” on Thursday (4 June 2026), Aryanto Nugroho, National Coordinator of Publish What You Pay (PWYP) Indonesia, highlighted the urgency of utilizing fiscal instruments through regional legislatures to address the growing threats of the climate crisis and ecological inequality in the regions.
Challenging Fiscal Inequality and the Ecological Crisis
In his presentation, PWYP Indonesia highlighted the paradox faced by Indonesia’s extractive resource-producing regions. These regions are often forced to bear the massive environmental costs of extraction—from deforestation to pollution—while the fiscal revenue-sharing they receive is frequently disproportionate to the ecological restoration costs they must shoulder.
Aryanto stressed that World Environment Day should be understood as more than a symbolic annual commemoration. Instead, it should serve as a momentum to pursue structural reforms at the regional level by integrating environmental policies into the legislative, oversight, and budgeting functions of regional legislatures (DPRD).
“Fiscal and socio-ecological justice will remain out of reach as long as regions are trapped in a development mindset that prioritizes exploiting natural resources to maximize short-term locally generated revenue (PAD). This is where members of the Regional Green Parliament Caucus (KPHD) have a crucial role in shifting that paradigm,” Aryanto explained.
Three Green Fiscal Instruments for Regional Legislatures
To equip regional lawmakers with practical policy options, PWYP Indonesia proposed three ecology-based fiscal reform instruments that can be adopted and promoted through parliamentary functions:
Ecological Tax. The introduction of upstream fiscal instruments that impose taxes or disincentives on polluting industrial activities, in line with the Polluter Pays Principle.
Ecological Fiscal Transfer (EFT). A performance-based fiscal incentive mechanism implemented from the national government to regional governments, as well as from regional governments to villages. The scheme is designed to reward jurisdictions that demonstrate a strong commitment to protecting forest cover and conserving ecosystems.
Implementation of Exit Costs. Strengthening oversight of mine reclamation and post-mining guarantee funds to ensure that corporations do not abandon unreclaimed mine sites that ultimately become a financial burden on regional government budgets.
Advancing the Regional Green Parliament Academy
The national workshop also produced an important reflection on the sustainability of the green political movement at the regional level. Recognizing the challenges posed by limited institutional capacity and political turnover within regional legislatures, the KPHD forum, together with civil society organizations, proposed the establishment of a Regional Green Parliament Academy.
The initiative is regarded as a strategic step toward institutionalizing knowledge on environmental governance and ecological fiscal reform. It is expected to provide consistent guidance for regional legislators in drafting environmentally responsive regional regulations (Perda Hijau) and in assessing the environmental orientation of regional government budgets (APBD).
Through this collaboration, PWYP Indonesia reaffirms its commitment to working alongside KPHD to ensure that the vision of ecological fiscal justice moves beyond discussions in parliamentary meeting rooms and is translated into concrete public policies that protect communities’ rights and safeguard ecosystems on the ground. (AN)