House sees fiscal decentralization bill as too vague
House sees fiscal decentralization bill as too vague
JAKARTA (JP): The House of Representatives asked for a clear-
cut revenue-sharing formula to be included in the bill on fiscal
balances between the central government and local administrations
to ensure a fair distribution of income.
In a meeting with Finance Minister Bambang Subianto on
Monday, the House's four factions were united in arguing that the
draft legislation, in its present format, is so unclear about
revenue sharing that the bill resembles a "blank form" for the
central government to fill out according to its wishes.
They said the bill, submitted by the government on Feb. 12,
was so lacking in clarity that it remained entirely unclear as to
how the legislation would affect the incomes of local
administrations.
"Their provisions are so general and vague that the real
virtue of the legislation will finally depend on the central
government," said Robbani Thoha, spokesman for the United
Development Party (PPP) faction, in the general debate on the
bill.
Robbani said that in its present format the legislation would
require another law, at least 11 government regulations, and one
decree of the finance minister for its full implementation.
"This means most of the essential elements of the fiscal
balance will still be decided by the central government," Robbani
said.
Arsen Rickson of the Golkar faction also criticized the bill
for not clearly stipulating how local administrations will
benefit from natural wealth in their areas and how expenditure
assignments will be arranged.
Rickson said the bill still allowed for domination by the
central government of local administrations, thereby keeping them
heavily dependent on funding from Jakarta.
"This shows the arrogance of those in power, who tend to
dismiss people's aspirations," Rickson added.
Unfair sharing of revenue has sparked separatist pressure in
some provinces, increasing dramatically since the ousting of
authoritarian president Soeharto last May.
Local people have become increasingly disillusioned by what
they perceive as Jakarta's greed for the provinces' resources and
disregard for their welfare.
The submission of this bill, together with an earlier
legislation draft on greater local autonomy, was designed to
create a more equitable distribution of income between the
national government and provincial administrations. Moves that
are hoped will dissipate separatist pressures.
According to the bill, local administrations would generate
income from several kinds of local taxes and user charges, local
administration-owned enterprises and transfers from the central
government.
"But we find it entirely insensible as to why the bill does
not outrightly stipulate the revenue-sharing formula but instead
refers it to a regulation which will be issued by the central
government," said Nico Daryanto of the Indonesian Democratic
Party (PDI) faction.
Daryanto insisted that the people demand an unambiguous
formula for the sharing of revenues. "They want a bigger share of
the wealth in their areas," he added.
The bill states that the local administration's share of
income from natural wealth in the area will be determined by the
government through a separate regulation.
"This bill indicates that the central government is still
half-hearted in awarding more financial autonomy to the local
administrations," Daryanto said.
Namuri Anoem of the Armed Forces faction concurred that there
are too many vague stipulations in the bill that will make it
largely dependent on further regulations to be issued by the
central government.
The four factions also criticized the stipulation of the bill
that allows local administrations to borrow from domestic sources
as an encouragement for them to run a budget deficit.
"This autonomy, we think, is excessive and may discourage
local administrations from optimizing local resources," Daryanto
argued. (das)