Decentralization remains a delicate issue in Bali

Decentralization remains a delicate issue in Bali

Rita A. Widiadana, The Jakarta Post, Denpasar

In the decentralization era, Bali, like other provinces in
Indonesia, has been struggling to fight for the right to manage
its own affairs, and financial, human and natural resources so as
to improve the living standards of its people.

Even after four years since local autonomy was rolled out in
2001, Bali's seven regencies -- Badung, Gianyar, Tabanan,
Klungkung, Karang Asem, Jembrana and Buleleng -- and one
municipality -- Denpasar -- are still finding it difficult to
implement the law without giving rise to friction, especially as
regards the transfer of powers from the central to the provincial
government, and from the provincial government to
regency/municipality administrations.

Revenue-sharing between the central and local governments,
taxation and budgeting, and relations between the legislative and
executive branches at the local level remain sensitive issues.

Government officials together with the private sector and
local communities on the island still sense a lack of justice and
equity in the way in which local autonomy has worked out.

Having been treated as a cash cow for more than 30 years by
the central government, Bali is now demanding its fair share of
the tourism revenues and taxes that go directly to the central
government.

Around 30 percent of Indonesia's annual tourism revenues of
US$6.3 billion are generated in Bali. The province has
contributed Rp 250 billion (US$25 million) from visa-on-arrival
fees since the highly restrictive visa policy was introduced in
February 2004.

The total number of tourist arrivals at Bali's Ngurah Rai
Airport is second only to Jakarta, yet the province is denied a
significant cut of the airport taxes. There are many people in
Bali who live in poverty. The island also lacks adequate
infrastructure to support the rapid growth in the tourism
industry and the rapid pace of urbanization.

In order to help ensure the proper implementation of local
autonomy and create a good governance, Udayana University in
Denpasar in cooperation with the United States Consulates General
in Surabaya and Denpasar, facilitated a meeting involving four
visitors from the United States, Bali provincial and
regency/municipality officials, experts and councilors over
weekend.

Jane E. Norton, Lieutenant Governor of the State of Colorado,
shared her experiences of managing her local budget, one third
of which comes from the federal government, one third from local
taxes and the rest from the state.

"We have applied a decentralization system for more than 200
years, but we are still learning to implement it properly by
reforming the budgeting system, policy making, and creating
effective strategies to increase the welfare of the community,"
Norton said.

Priority must be given to activities that benefit the majority
of the people, she said.

"Funds must be managed wisely in a clear and transparent way
with strong public monitoring to eliminate any possible misuse
and budget discrepancies," she added.

Serena Cruz, a county commissioner from Portland, Oregon,
warned that in a decentralized system, the central government
needed to understand that each region had distinct
characteristics.

"We may have an agriculture-based state or an industrial
state. Each has its different needs. We should not make a
generalization in planning the budget. The local authority should
be given more freedom to decide its budget allocation," she said.

"It is quite lucky that in the United States, public and
professional involvement has been very strong so that no official
would dare to conduct any corrupt actions," she added.

Dr. Nyoman Arya, representing the rector of Udayana
University, said that Bali still has a lot to learn.

"Our officials are still fighting each other to get bigger
slices of the cake. Corruption is still endemic," he said.

Separately, Ryaas Rasyid, an expert on local autonomy, urged
everyone in Bali to fight for the island's fair share.

"Both the provincial and regency/municipal administrations
must draw up a feasible design for revenue sharing and propose
it directly to the central government," said Rasyid, the former
state minister for local autonomy.