Regional autonomy has not lived up to expectations: Minister
Regional autonomy has not lived up to expectations: Minister
Tiarma Siboro
The Jakarta Post
Jakarta
Regional autonomy has sparked disputes between the central
government and local governments, local governments and the
public and even among the local administrations since it came
into effect more than three years ago. To make matters worse, the
government intends to revise the ruling, which, to many, signals
a move to transfer the power back to the central government. The
Jakarta Post's Tiarma Siboro interviewed Minister of Home Affairs
Hari Sabarno over the implementation of regional autonomy and its
implications.
Question: After more than three years, has decentralization
succeeded in reaching its goals?
Answer: The concept of decentralization is to transfer the
central government's duties to local governments to allow locals
to directly enjoy achievements in development in their own
region. When it was first introduced in 1999, decentralization
was also aimed at preventing the central government from
intervening too much in local affairs so that we could focus on
macro policies. It means that the central government is
supervising and observing the whole process of regional autonomy.
Through decentralization, we can also improve the regions'
ability to tackle their own problems, and it also symbolizes the
trust of the central government in local governments.
But nowadays we consider that the regions have not yet met our
expectations due to various obstacles, including their lack of
readiness to manage their problems. This situation has forced us
to intensify control over local governments to enable them to run
the program.
Do you think the whole process of decentralization has been
completed, including the handover of authority from the central
government to local administrations to run businesses with
foreign parties?
In general, we have completed the whole process, including
transferring authority to the regions to do business with other
parties. The authority related to business management is
stipulated in Article 7 of Law No. 22/1999 on regional autonomy.
Of course, we insist on implementing our macro policies on
national economy to regions, while at the same time paving the
way for them to develop their own policies to maximize their
strength.
In this context, regional autonomy opens the way for regions
to promote investment, to speed up the process of issuing
business permits and to establish various infrastructure to
support the running of the economy. This means that through
regional autonomy, we can improve regional welfare continuously.
In line with decentralization, there are three major points that
local administrations have to take into account: strict and
simple regulations, the removal of unnecessary costs and
enhancing favorable social and security conditions.
In regard to foreign investment, we have not authorized
regions to issue permits because based on Article 10 of Law No.
24/2000, the mechanism dealing with foreign investment and
foreign loans or grants designated to the central government or
private sector needs the approval of the House of
Representatives.
But I think investors understand which business permits come
from the local authorities or the central government. Foreign
investment, of course, involves the central government because
regions have no authority to conduct direct business with foreign
parties. In this case, it is the authority of the BKPM
(Investment Coordinating Board) to facilitate the investment and
to negotiate with foreign investors. Regions will only get
involved once the deal has been settled, especially on issues
that affect their interests, such as the location of the
investment or benefits they may earn from the investment.
So far, I can see that local administrations perceive they
have to develop fair competition to attract foreign investment
because it provides job opportunities for them. It will also
improve a region's standard of living, and that eventually
affects the local administration's revenue from taxes.
Have you noticed various problems filed by foreign investors due
to overlapping regulations between the central government and
local administrations?
Foreign investors commonly complain about the confusing
regulations because they change from time to time. They also
complain about the security condition in some regions, although
investors who have run their businesses for years in certain
regions voice the same complaint.
We hope regions will be able to change their mentality to
realize that the presence of both domestic and foreign companies
around them is part of the ongoing efforts to help them improve
their welfare.
These companies, of course, are expected to allocate more
funds to improve the regions' standard of living, so as to create
a synergic environment that includes social contact and
sustainable development.
Despite various limitations made by the central government,
several regions have established a cooperation with foreign
parties.
Of course we cannot prohibit them (other countries) from building
a cooperation with local administrations, but the question is,
are these investors afraid if successors of the incumbent (local)
regime, as well as local councillors, revoke all policies taken
by their predecessors?
Foreign investors have to realize that the incumbent local
administrations have only a limited time of service, and are not
permanent. A regent or mayor is in power for five years, and that
power can be extended for another term.
This could mean that a project funded by foreign investment in
a region should not last more than five years. The situation is
extremely different with the state government, in which the
successor continues the policy made by his predecessor. That is
why a cooperation with foreign parties has to involve the central
government.
Currently, we (the Ministry of Home Affairs) are preparing a
regulation on cooperations between foreign parties and locals,
especially in dealing with foreign loans and financial
investments. Of course, regions can cooperate with foreign
parties in social and cultural fields without the prior approval
of the central government. The cooperation is expected to prevent
the local administration from going bankrupt as what has happened
in other developing countries, such as Mexico, following the
adoption of decentralization.
In the draft regulation, we stipulate that there should be a
strict arrangement regarding the maximum foreign loans a region
can accept and a maximum due date for the loans, which are less
than five years.
How long will it take for local administrations to manage their
own problems without the intervention of the central government?
It depends on human resources and natural resources alike.
The more resources they have, the faster they can manage
themselves. Regions which lack natural resources are expected to
possess quality human resources to create various innovations to
attract investors. They can do many things, including providing
better services for investors.
Should decentralization run smoothly, it would boost economic
expansion beyond Java. Would it have any impact on relations
between the central government and the local administrations?
We get the impression that the implementation of regional
autonomy has been partial, sporadic and misinterpreted, despite
the fact that the regions maintain the spirit (of regional
autonomy) because it helps them develop their own policies and
improve the standard of living.
But on political issues, we can see that regional autonomy has
sparked euphoria among executives and legislators as we often
witness in disputes among them. Of course, this affects the
development process and even spreads the threat of disintegration
among regions.
Governors once complained that following the introduction of
regional autonomy they no longer had the same power as they had
before. How do you deal with that issue?
Since we introduced regional autonomy, we have handed over 18
areas of authority to governors in a bid to give them some
control over regencies and mayoralties. Of course, these
jurisdictions only deal with administrative issues in forestry,
mining, ports and other fields.
How about the government's plan to revise the regional autonomy
law?
We are currently preparing a revision of five major issues: a
clear cut separation between the authority exercised by local
administrations and the central government; relations between the
local legislature and the local administration, which is crucial
in promoting political stability in regions; the arrangement of
local revenues, ranging from regional revenue to revenue sharing,
and special and general allocation funds; the policy on the
placement of civil servants in regions to make them more
flexible; and the evaluation of various border regulations.
Do you think that regional autonomy tends to promote
ethnocentrism and if so, how can we cope with the problem?
People have to understand that the meaning of regional autonomy,
including its philosophy, vision, concept, background, basic
regulations and the strategy to implement it, is to avoid any
instant way of thinking, including the thought that they can
force their demands and aspirations through mass rallies or
demonstrations.
And since regional autonomy is the fruit of decentralization
and democratization, the process should be seen as an effort to
open the way for the selection of legitimate local leaders who
are able to promote their ideas to the people. There is also the
need for local leaders to maintain the decision-making mechanism,
which makes them accountable to the public.
We consider democratization should be promoted in a situation
where local leaders are transparent to the public and responsible
for all the decisions they make.
Regional autonomy has to be seen as an opportunity for local
people to develop their administration and create a system that
develops its political career so that they can promote good
governance. It means that regional autonomy should be managed
well for the sake of keeping up social harmony between the locals
and the various elements living around them. In this way, we hope
that local people can be responsive to their surroundings.
Is the government developing a plan to provide scholarships in an
attempt to improve human resources in areas?
In a bid to improve human resources in a region, the ministry has
established a cooperation with the related institutions to
provide regular education and training, including offering
scholarships. But since we have a limited budget, we have to
select and set up priority programs.
In line with decentralization, regions can organize the
programs with other regional institutions.
Local legislatures apparently play prominent roles in promoting
good governance. But judging from the several cases that have
affected the relations between executives and the legislature at
the local level, it seems that local councillors have failed to
do this. Since people will be voting for a legitimate
representative, do you see the situation improving after the 2004
general election?
Regions have been prone to political disputes between executives
and legislatures following the inception of regional autonomy. If
the conflicts are sparked by attempts to discharge the heads of
local governments for the sake of people's interests, I don't
mind. But what we have mostly seen is legislatures using
illogical reasons to replace political opponents.
We have to underline that dismissals should comply with the
rules of the game. Local councillors have the authority to
discharge a regent or mayor should they fail to carry out their
duties according to government regulation No. 108/2001. For
example, regents and mayors are not accountable, so councillors
can reject their annual report or accountability speech, or they
introduce conflicting policies that affect public trust.
Nevertheless, these reasons do not automatically legitimize
the unseating of the head of a local government until an
independent team set up by the provincial administration verifies
the mistakes.
What we have seen is councillors ignoring all the procedures.
Some of these cases are related to political rivalry.
Speaking about the quality of our local councillors, I'm sure
we will have better ones after the 2004 election with the
introduction of several criteria for legislative candidates,
including formal education and legitimacy. Besides, people will
directly cast their vote. In this situation, we hope that local
councillors will be able to accommodate their constituents'
aspirations.