Expert finds loopholes in fiscal autonomy law

JAKARTA (JP): The central government will retain some fiscal control over provinces despite a new law promising to give the regions a greater share of their own resources, a University of Indonesia legal expert said on Tuesday.

Arifin P. Soeria Atmadja said the Intergovernmental Fiscal Balance Law represented major progress in promoting greater regional autonomy, but it still empowered the central administration to draw up regulations for implementation.

The law was vague on the boundary of responsibilities between the regional and central administrations, he told a seminar on regional autonomy and finances organized by Hatta International Legal Counsel and the Winaya Dharma Foundation.

The House of Representatives endorsed the regional fiscal balance law along with the law on regional administration in April, paving the way for greater autonomy for the regions down to regency and mayoralty offices in managing local affairs, including financial needs.

The laws will come into effect in two years to allow local administrations time to assume their new responsibilities.

Arifin said the central administration would need to issue about 15 regulations to implement the regional administration law and 12 regulations for the fiscal balance law.

"It is feared that this blank check will be used by the central administration to intervene, bearing in mind that it has the monopoly in drawing up the regulations," he said.

"Delays in drawing up the regulations will lead to speculation that the government might try to interfere to ensure their control, or the law may never be implemented."

Other speakers in the seminar also acknowledged the law was necessary to promote democracy, but further clarification was necessary to avoid confusion and complication.

J. Kristiadi, vice president of the Centre for Strategic and International Studies, questioned the ability of regional legislative council members to control local administrations, as mandated in Article 19 of the regional autonomy law.

Citing the example of North Sumatra, he said many current provincial council members held junior high school educational backgrounds and only a few possessed university degrees.

The government would be able to take advantage of the situation to control council members, he said.

Raksaka Mahi, an economist from the University of Indonesia, said relations between provincial and regency/mayoralty administrations must be redefined.

Since autonomy would be given to the regencies and mayoralties, the existing hierarchical structure placing the provincial administration above them would no longer apply in two years' time, he said.

Bagir Manan, a professor of from Padjadjaran University in Bandung, dismissed fears that greater regional autonomy would lead to the breakup of the unitary state.

"Any threat of disintegration would not come from greater regional autonomy, but from government centralization," he said. (02)