Open discussion vital for federalism

Open discussion vital for federalism

By Oliver Draper

JAKARTA (JP): The interest in changing the Indonesian
government from a unitary to a federal one is fueling a lively
debate. The key participants are students, political scientists
and constitutional experts, although to date they have not been
successful in moving public opinion.

The supporters of the unitary state -- which includes
government, many of the main political parties, such as the
Indonesian Democratic Party of Struggle (PDI Perjuangan), Golkar
and the Indonesian Military (TNI) -- still hold the high ground
and can convince society of the preservation of the unitary state
system. The big challenge for the federalists is the public's
perception that their ideas are new and lack understanding of the
central issues.

The demand for a federal system is largely the product of a
feeling of injustice against central government, and its abuse of
local revenue distribution accompanied by authoritarian actions
by members of the armed forces and government officials.

This has created an unhealthy undercurrent of resentment
against the system, which has been surfacing in different ways
for several years now.

The particularly open declaration for a federal system in East
Kalimantan has led to an important development. The provincial
authority has gone so far as to submit a clear and detailed
request listing three specific demands, despite considerable
political pressure from PDI Perjuangan.

The first point deals with local revenue distribution, stating
that 75 percent should be retained for use by the province, with
the balance being made available for central government.

The second request is for the provincial government to have
full authority to manage its natural resources, without central
interference, an approach taken by corrupt regimes of past
governments.

Thirdly, the provincial government has requested a degree of
repatriation of profits earned within the province by state owned
enterprises (SOEs) and private companies originating outside it.

The students' argument for a move towards federalism also
addresses the possible impact on the army of such a reform. A
reduction in the power of the military would mean a gradual
elimination of their involvement in local politics and economic
development.

Another significant group of participants backing federalism
is the growing pool of young well-educated people who support the
National Mandate Party (PAN).

Their chairman, Amien Rais, Speaker of the People's
Consultative Assembly (MPR) has spoken in favor of the federal
system at the risk of protest from PDI-P and Commission II of the
House of Representatives (DPR).

Noted economist and secretary-general of PAN, Faisal Basri,
also supports the federalist movement. He believes that real
regional autonomy must be founded on a federalist framework
because that will be the only way for each of the regions to
exploit their particular characteristics to the fullest extent
possible, and survive in a globally competitive environment.

There are several other political observers in favor of
adopting a federal state system. Arbi Sanit says in trying to
maintain a unitary state, Indonesia would be in danger of
dissolution since half of the provinces have requested
independence.

Indeed it is the early days of Indonesia's history to which
historian Anhar Gonggong refers in his argument when he says that
the debate in favor of a federal structure dates back to the
proclamation of the republic. Gonggong believes that in the
implementation of a well thought out federal structure there
would be no reason for the regions not to survive, given the
mandate to regulate them.

There is a fundamental difference between the decision-making
process implied by a federalist structure and that of a system of
regional autonomy.

In the former, the authority is transferred to the province
while the latter case rests within the central government. The
union of states making up the federation act separately for the
benefit of their state, deferring to the central government only
on questions of national interest such as foreign, defense or
national economic policy.

All domestic or development issues would be under provincial
jurisdiction. It goes without saying that the implementation of
such a system would require the agreement of all provinces.

The complete agreement over the delegation of authority and
implementation procedures needed for the establishment of an
Indonesian federation will not be easy to come by.

The unitary state ideology is already deeply ingrained. The
whole process would require agreement on an overhaul of the
current system, as well as major provincial details to be worked
out such as tax raising powers, for example, and the equally
major details to be agreed upon in the realm of defense, foreign
and central monetary policies.

Whichever road is taken, the potential will be there for
empowerment of the provinces and development of a sense of
belonging within each province. Therefore it is important to
recognize the two laws in place dealing with the issue of
devolution -- Law No. 22 (1999), the focus of attention of Ryaas
Rasyid, State Minister for Local Autonomy Affairs on regional
autonomy and Law No. 25 (1999) on the financial arrangement
between the central and provincial authorities -- as the
immediate drivers of change.

For supporters of the unitary state -- such as the Chairman of
the newly founded National Economic Board (DEN) Emil Salim --
these laws are considered to meet the criteria of a compromise
approach. He argues that they are adequate to satisfy the demands
of a federal structure, if properly applied, the Indonesia to
emerge would be one of the most decentralized countries in the
world. In addition to meeting community demands, their
implementation would result in 40 percent of funds returning to
the local government.

The federalists, however, are skeptical about the
implementation of those laws. In the event that they are
successfully enacted, they claim that there would be greater
opportunity for abuse of the system under the new Indonesia. The
objective should be to work together to find a suitable solution
for the benefit of the people as a whole.

In this regard, constitutional law expert Soemantri has
suggested amending article No.18 of the 1945 (provisional)
Constitution, where federalism was freely discussed, and where
the question of establishing a realistic system of local autonomy
is clearly laid out.

The parties involved should be able to reach a resolution, but
it will require open dialogue between central and local
governments as well as other important national institutions.
This must be actively encouraged to break the stalemate between
the federalists and the autonomists.

The writer is president director of Strategic Intelligence,
Jakarta.