Analysis of the Value for Money Method in Measuring the Financial Performance of Local Governments in East Java Province

Abstract

Abstract— This study aims to measure, classify, and describe the financial performance of 38 local governments in East 
Java Province. The measurement is conducted using the value for money method. The data analyzed comprised APBD data 
from 2020 to 2022. The results show that, from the economic aspect, 16% of local governments in 2021 and 45% in 2022 
performed adequately economically. Based on the efficiency aspect, 45% in 2020, 24% in 2021, and 89% in 2022 were still 
performing inefficiently. Based on the effectiveness aspect, only Surabaya performed less effectively in 2020. This study is 
expected to assist the Government in evaluating and taking measures to manage its finances more economically, efficiently, 
and effectively. The novelty of this research lies in the absence of previous studies that measure the financial performance of 
local government in East Java Province using the value for money method.