2.6 WORKSHOP ON PARTNER COUNTRY PERSPECTIVES FOR TRACKING DOMESTIC AND INTERNATIONAL CLIMATE- AND BIODIVERSITY-RELATED FINANCE

CLIMATE TRACKING SYSTEM INDONESIAN EXPERIENCE

Presented in OECD Working group Environment

Paris, 19-20 May 2015

OUTLINE:

1. BACKGROUND 2. DEFINITION 3. SYSTEM AND DATA COMPILATION 4. CONCLUSION

BACKGROUND

1. INTERNAL FACTORS: * accountability and transparancy

• quality of spending with Performance based Budgeting system • Fiscal Policy Credibility with the Green Planning and Budgeting

Strategy 2. EXTERNAL FACTORS:

* pilot countries for mitigations and biodiversity Financial Initiative * Donor coordinations and effectiveness

DEFINITION Climate Change related activities: • Only activities that directly or indirectly reduce greenhouse gas

emissions or increase resilience to climate change, and • Activities in which the reduction of GHG emissions related to

climate resilience or activities specified in the documentation of the program as a destination or a benefit (such as output indicators).

• For public expenditures through Ministries’ Budget plan are classified to direct and non direct activities, both are tagged.

• 2 classification of public expenditures related to climate are : a. National Budget b. Sub-national Budget

CLIMATE CHANGE AND BIODIVERSITY ACTION PLAN

CLIMATE CHANGE MITIGATION ACTION PLAN

CLIMATE CHANGE ADAPTATION ACTION PLAN

BIODIVERSITY ACTION PLAN

DEFINITION (2) Does not include activities:

1. manufacturing / production equipment for the generation of renewable energy and R & D activities for these technologies; 2. fuel conversion: a shift from coal or oil to gas in energy production;

3. increase the efficiency of power plants to fossil fuels;

4. technology-based co-production of fossil fuels that generate electricity in addition to providing cooling / heating;

5. manufacturing / production equipment that is more efficient and R & D activities for green technology;

6. the addition / expansion of the road network to reduce traffic;

7. application of speed limits on the highway to reduce emissions in the driving / driving.

DEFINITION (3)

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all activities related to research, management data and documentation of biodiversity, management ownership for country;

all activities related to development benefits of biodiversity to support national competitiveness economic growth and social welfare.

All activities related to maintenance, protection and restoration of biodiversity

All activities related to enhance the capacity of managing biodiversity integrated and partisipatif approach

DEFINITION (4)

Based on IBSAP, activities for biodiversiy can be classified into 4 types, each type can be consist of :

a. Direct Cost : all activities which have direct impact to biodiversity based on each classificaton

b. Indirect Cost : all activities which have not direct impact to biodiversity but give support to main activity implementation

1

2

3

4

DEFINITION (5)

INTERNATIONAL DEVELOPMENT PARTNERS/ODA The DAC defines ODA as “those flows to countries and territories on the Development Assistance Committee (DAC) List of ODA Recipients and to multilateral institutions which are:

i. provided by official agencies, including state and local governments, or by their executive agencies; and

ii. each transaction of which:

a. is administered with the promotion of the economic development and welfare of developing countries as its main objective; and

b. is concessional in character and conveys a grant element of at least 25% (calculated at a rate of discount of 10%)

3 different characteristics of International fund flows:

1. On Budget - On Treasury (recommended by Ministry of Finance)

2. On Budget – Off Treasury

3. Off Budget – On Treasury

4. Off Budget – Off Treasury

Collected data on disbursements of public climate finance in 2011

coded 12 000 lines of state budget for 11 key ministries

checked databases on intl. climate finance

surveyed 25 international development partners reviewed national data on local government transfers and a

case study for one region

literature review of 46 state-owned enterprises conducted many interviews with stakeholders.

SYSTEM AND DATA COMPILATION

Agriculture

Forestry

Energy

Transport

Waste (water)

Industry

Disaster Risk Management

Infrastructure

SYSTEM AND DATA COMPILATION THE LANDSCAPE FRAMEWORK

At what level budget marking for climate expenditure should be done? Agreed at the activity level In reality expenditure items e.g. related to RAN GRK

are scattered under different activities Example from KPH, two activities:

2283 Pemantauan Usaha Kehutanan 6 out of 609 expenditure items – based on component

2287 Program Peningkatan Usaha Kawasan 21 out of 60 expenditure items – based on component

SYSTEM AND DATA COMPILATION

Performance Indicators

Performance Indicators

Line Ministry/Agency Budget Document

Program

Activity

Component

Sub Component

Account (6 digit)

Detail Item

Outcome

Output Budget themes : 1. MDG’s-1 : Poverty Alleviation; 2. MDG’s-2 : Basic Education; 3. MDG’s-3 : Gender Equality and Women

Empowerment; 4. MDG’s-4 : Child Mortality Rate; 5. MDG’s-5 : Mother Health; 6. MDG’s-6 : HIV/AIDS, Malaria, and Other

Diseases Alleviation; 7. MDG’s-7 : Environment and Climate Change; 8. MDG’s-8 : Global Cooperation; 9. Infrastructure; 10. Public Private Partnership; 11. South-South and Triangular Cooperation.

Climate Change Mitigaton

SYSTEM AND DATA COMPILATION

1. Setting definitions

•Set a working definition for climate finance

2. Applying definitions

•Identify activities in state budget that fall under the proposed definition

3. Verification

•Confirm coding results with each respective agency

STATE BUDGET (APBN)

SYSTEM AND DATA COMPILATION LOCAL GOVERNMENT BUDGET (APBD)

1. Setting definitions

•Set a working definition for climate finance

2. Applying definitions

•Access local budget data

3. Applying definitions

•Identify activities in local budget that fall under the proposed definition

4. Verification

•Confirm coding results with each respective agency

National data:

• General reporting and tracking systems are in place, but need to increase the capacity and

• Enhance information on local governments’ climate finance

Source

Frequent update on nat. level

Disbursement

Climate markers

Impl. Partner Why using it at all?

Nat.

APBN X X X X Budget marking system on the way

APBD X On national level only

data on deconcentration/ co-administration

PUBLIC CLIMATE FINANCE DATA

INTERNATIONAL PUBLIC FINANCE DATABASES SOURCES

TYPE OF FUND Available from Database APBN (central govt expenditures) APBD (sub national govt expenditures)

Funding department

MoF-Internal database on loans and grants

APBN APBD

DG Financing and Risk Management (former Debt Management Unit)

BAPPENAS-internal database on loans and grants

Multi donors and Overseas Donor Assistances

http://stats.oecd.org/Index.aspx?DataSetCode=RIOMARKERS#

Organisation for Economic Co-operation and Development (OECD) Creditor Reporting System (CRS) Rio Markers

International Databases Not clear whether/when OECD disbursement data will be sufficiently robust in the future.

National databases: General reporting and tracking systems are in place, but need to be enhanced by climate markers, Improve reporting so the government can better oversee and manage flows.

Source Frequent update

Disbursement

Rio Markers

Project level

Impl. Partner clear?

Why using it at all?

Intl. OECD/ others

X X X Identifies climate finance

Nat.

MoFinance-DMU

X X X X

BAPPENAS X X X Identifies disbursement year

INTERNATIONAL CLIMATE FINANCE DATABASES

CONCLUSION (1)

Enhance tracking & reporting

Scale up climate finance Address blockages in flows to and

through national funds, multilateral devt partners, revolving funds and

local transfers.

Develop the self compliances for implementators and strengthen the

systems for tagging of climate finance in the national budget.

Improve administration and reporting of international climate finance so the government canoversee and manage

flows through the country system

Enhance information on local government, we are currently working to develop the budget tagging system

for local govt.