Decentralization in urgent need of major overhaul<\/p>\n
Bahtiar Arif, Center for Indonesian Reform, Lecturer, University of
\nPancasila, Jakarta<\/p>\n
Decentralization is now four-years old as a result of \"reform\"
\nin 1999. Under laws No 22 and 25\/1999 and their respective
\ngovernment regulations, regional administrations have been more
\nflexible to run programs according to their needs.<\/p>\n
Yet it has not been easy for Indonesia to manage more than 300
\nregional administrations. Therefore, decentralization has
\nproduced at least two negative consequences. The most dangerous
\neffect is corruption as President Megawati Soekarnoputri and
\nMinister of Home Affairs Hari Sabarno had warned earlier.<\/p>\n
Another unintended consequence has been the widely cited
\npotential of separatism. A number of regional governments have
\nraised a campaign to be independent and it is not impossible that
\nthe campaign has been supported by funds from the central
\ngovernment.<\/p>\n
The funds have been poorly monitored. In Sumatra a regent
\nbought a luxurious car financed by the regional budget. In
\nKalimantan, the take-home pay for the top executive and regional
\nlegislative members has reached Rp 10 million per month, higher
\nthan that for the central government officials.<\/p>\n
It has been difficult to study or investigate allegations of
\ncorruption, given the lack of transparency and high degree of
\ncollusion in the public administration.<\/p>\n
Even without corruption, ineffectiveness and inefficiency in
\nthe use of public money would follow decentralization, as a
\nresult of a lack of skills and knowledge in handling a sudden
\nlarge amount of money from Jakarta.<\/p>\n
Related studies have indeed focused on such \"inefficiency\".
\nPublic investment in the budget or \"development expenditures\"
\ntends to be corrupted. This is commonly done by enlarging and
\nballooning expenditures.<\/p>\n
Further, the government system requires that projects are
\ncontracted out by private enterprises by a bidding process.
\nCollusion between a government official and a manager of a
\nprivate enterprise is not uncommon, reducing the productivity of
\npublic investment. This becomes worse when expenditures are
\nfinanced by foreign loans.<\/p>\n
A study by Tanzi and Davoodi (1998) uses corruption data from
\nBusiness International, Political Risk Services Inc. and
\nInternational Country Risk Guide, and public investment data from
\nGovernment Finance Statistics from the International Monetary
\nFund. They concluded that high corruption is associated with high
\npublic investment.<\/p>\n
Decentralization of investment by the central government to
\nthe regional government has, as business people have said, led to
\ndecentralization of corruption. Bribery and collusion are
\ntransferred to regional government officials, supported by local
\npoliticians seeking to gain as much as possible as they aren't
\nsure they will keep their seats in the next election.<\/p>\n
To cope with those problems, these following proposals may be
\nconsidered.<\/p>\n
First, the decentralization laws and regulations may need to
\nbe revised. It can be done by analyzing the negative effects and
\nby using the new approved law on state finance. The most
\nimportant to be revised is the system and policy of fund
\nallocation to the regions.<\/p>\n
There has been a potentially dangerous shift of internal
\npolitical affairs since the implementation of the allocated
\nfunds. Local governments have approached the Ministry of Finance
\nto negotiate and obtain the funds, instead of the Ministry of
\nHome Affairs, who used to control and supervise the local
\ngovernments -- leading to fears of funds being used to campaign
\nfor independence.<\/p>\n
The fund allocation policy should be determined by the
\nMinistry of Home Affairs, who should be responsible over such
\ninternal politics.<\/p>\n
But this is provided that the central government establishes a
\nblue print of the decentralization process. It may consist of
\nshort, medium or long-term planning, which prepares the
\nstructure, and determines clear steps and targets.<\/p>\n
Skills and knowledge of local manpower must be improved by
\ntraining and development skill programs. This should be a part of
\nthe blue print; skilled human resources at the central government
\nmay be also transferred to the local government.<\/p>\n
Government Regulation no.110\/1975, which determines the money
\nused by the regional legislature, should be restored and the
\nSupreme Court decision to annul the regulation should be revised.<\/p>\n
Finally, the use of public money should be regulated based on
\nsocial justice. As decentralization should be designed to improve
\npublic services, this needs government officials and politicians
\nwho place national and public interests over their own.<\/p>\n
The writer is an alumnus of the University of Manchester, UK<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/decentralization-in-urgent-need-of-major-overhaul-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }