Bridging policy–implementation gaps in digital building permit reform: A collaborative governance approach to sustainable local revenue

Abstract

The reform of Indonesia’s building permit system through the Building Approval (PBG) and the SIMBG digital platform aims to enhance regulatory compliance, service efficiency, and sustainable local revenue generation. However, significant gaps persist between policy objectives and implementation outcomes at the local level. This study investigates these policy–implementation gaps and examines how collaborative governance can support effective digital transformation and sustainable local revenue enhancement. A qualitative exploratory approach was employed using Focus Group Discussions (FGDs) structured by the GROW (Goals, Reality, Options, Will) model, involving key stakeholders from government agencies, professional associations, academia, and the private sector. The findings reveal that while stakeholders share strong alignment on the strategic goals of PBG reform—particularly in improving service efficiency, transparency, and local revenue—implementation is constrained by multiple interrelated challenges. These include institutional fragmentation and weak inter agency coordination, technical limitations of the SIMBG platform, low public awareness and digital literacy, limited availability and uneven distribution of certified professionals, high compliance costs, and weak enforcement mechanisms. As a result, digital transformation alone has not translated into improved compliance or optimal revenue generation. The study identifies collaborative governance as a critical pathway to address these challenges. Key strategies include the establishment of multi agency task forces (SATGAS), intensified public socialization and mentoring, optimization of digital system usability and integration, development of standardized building design prototypes, and strengthening of enforcement capacity and institutional coordination. The findings further highlight that sustained implementation depends on long-term political commitment, adequate resource allocation, and alignment of institutional incentives. This study contributes to the literature by integrating collaborative governance and a GROW-based participatory framework to analyze digital building permit reform, explicitly linking governance quality to sustainable local revenue outcomes. The results underscore that bridging policy–implementation gaps requires not only technological solutions but also inclusive, adaptive, and collaborative governance arrangements to achieve sustainable urban development and fiscal resilience.