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Citizen participation is mandatory in setting development priorities for local government budgets in Indonesia. This is undertaken through a set of participatory processes called Musyawarah Perencanaan Pembangunan Daerah (Musrenbang) or participatory planning meeting, which is implemented from the village to district level.

These participatory processes allow the community to identify, deliberate, and prioritise development priorities based on their needs. Local governments can decide on the institutional design of participatory planning processes based on their own contexts, leading to varieties of institutional designs.

This thesis examines how these variations of institutional design affect local governments’ budget distribution, service delivery performance, citizen participation and social accountability mechanisms. The thesis employs a comparative case study based on the fieldwork in four districts and synthetic control methods. It argues that local governments that have integrated participatory planning with the budgeting processes in which decisions are formally binding have improved their responsiveness to community’s demands. In contrast, in the districts that have not, Musrenbang has served merely as a consultative arena, its results have often been neglected, and its effects on resource distributions have been limited. However, the participatory processes in the four districts have remained dominated by local elites.

The findings from synthetic control methods show that participatory budgeting has improved net junior secondary school enrolment rate for the overall population and household access to safe sanitation for the third quintile group. However, it has no effect on the other services assessed in this study and on the lowest two quintile groups.

Anwar Musadat is a PhD candidate at the ANU Centre for European Studies in the School of Politics and International Relations at ANU.