Abstract
<title>Abstract</title> <p>Across Southeast Asia, two decades of fiscal decentralisation have transferred substantial spending authority to local governments without an accompanying transformation in how budgets are planned. The result has frequently been the preservation of equal-share, input-oriented allocation beneath the language of autonomy. This article asks whether and how the move from equality-based to performance-based budgeting (PBB) can be designed at the meso level of a mid-sized city. Drawing on the case of Pontianak, the capital of West Kalimantan, it examines ALAKE (Ecology-Based Neighborhood Budget Allocation), the Ecology-Based Sub-district Budget Allocation scheme), a reform that ties part of the sub-district transfer to a composite Sub-district Performance Index (IKK) built from ecological and non-ecological indicators. Methodologically, the framework was not imported as a technical template but produced through structured deliberation among municipal stakeholders and codified in a revision of Mayoral Regulation No. 66/2019. Using the performance scores of all 29 sub-district, the article shows that the index captures genuine and multidimensional heterogeneity (scores range from 29 to 74 on a 0–100 scale; the ecological and non-ecological dimensions are weakly negatively correlated), and that competing allocation rules debated by stakeholders—proportional-to-score versus priority-based—imply markedly different distributions of winners and losers. The contribution is twofold: empirically, a replicable model for designing PBB in capacity-constrained local governments; theoretically, an account of how New Public Management instruments are contested and reformulated when they meet the realities of decentralisation in the developing Southeast Asian state.</p>