Expert finds loopholes in fiscal autonomy law

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.
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