Local govts confused over new autonomy

JAKARTA (JP): The decentralization of power under the new system of regional autonomy has sparked confusion among local governments, causing them to complain about conflicting regulations and legal uncertainties scaring investors off.

Chairman of the Association of Indonesian Regency Administrations (Apkasi), Syaukani H.R. said that many regency chief executives were in the dark about their roles in a decentralized economy.

"Our difficulties center on the coordination of power and authority," Syaukani, who is also chief executive of Kutai Kertanegara regency in East Kalimantan, said. He was speaking to reporters after a meeting between regency heads and mining investors organized by the news website Petromindo.com

According to him, some of this confusion stems from conflicting regulations issued by different government ministries.

Participants during the meeting, mostly regency chief executives, complained about there being a lack of coherence in several government regulations.

They also cited the absence of a legal framework for the mining industry under the regional autonomy scheme.

The current Mining Law No. 11/1967, contradicts the autonomy laws which put authority over mining in the hands of local governments.

The 1967 mining law stipulates that it is the central government which draws up mining policies for the regions.

This contradiction has left local governments lacking guidance over the legal foundations for their mining policies.

The Indonesian Mining Association (IMA) said the legal confusion had also deterred investment in the mining industry.

Syaukani said that the issuance of ministerial decrees posed another legal headache for local governments.

He said that when the People's Consultative Assembly revised Indonesia's legal hierarchy to bring it into line with the regional autonomy scheme, it stipulated that ministerial decrees ranked below local government regulations.

This, he said, had left regencies facing a Catch-22 situation as between complying with the central government's policies or pushing ahead with their own policies at the risk of displeasing the central government.

Syaukani also urged the government to more quickly disburse the regions' share of revenue from natural resources.

Instead of every six months, the regions should receive their shares every month, he suggested.

According to him, late payments have made it difficult for regions to plan their budgets. In fact, he added, regency chief executives often had to come to Jakarta to speed up the process.

"Don't make us come like beggars to Jakarta to get the funds disbursed," he said.

Under the intergovernmental fiscal balance law, provinces will get 15 percent of the government's oil revenues, 30 percent of gas receipts and 80 percent of mining royalties.

When asked about the biggest advantage the regions had obtained from autonomy, Syaukani said it was increased revenues.

He said that in the first semester of this year, his regency, for instance, had raked in some Rp 270 billion (about US$23.8 million) in revenue from the exploitation of its natural resources.

"We never saw that kind of money before. There used to be nothing from natural resources except from the forestry sector, and local taxes," he said.

During the seminar, the secretary-general of the Directorate of Geology and Mineral Resources, Sukhyar, said his office planned to revise the existing statutory environment governing mining so as to accommodate the impact of the autonomy laws.

"It's a shortcut for providing legal certainty while waiting for the new mining law to come out," he said.

He said he could have the revision ready in one month. (bkm)