Regional economy, and people, must be prioritized
Regional economy, and people, must be prioritized
By Sjahrir, analyst and Chairman of the New Indonesia Alliance
Party( Partai Perhimpunan Indonesia Baru)
Whoever wins the 2004 general elections will not be able
to govern properly if they do not attend to the economic problems
of the regions, and at the same time can overcome these issues.
The 2004 general elections will produce a president holding a
high degree of credibility and legitimacy. In the country's
history, never before has there been a directly elected president
able to claim that at least 68 million Indonesians voted for him.
The new president will need this mantle of legitimacy to tackle
the country's economic problems, which are in fact the regional
economic problems.
There has been much talk about the regional autonomy law as well
as its implementation in the past two years. Attention has also
been directed toward misuse of regional budgets both at the
provincial and regency levels, but it seems that few have made
efforts to find out the actual amount of damage that misuse or
budget errors cause to the people.
Granted, we cannot disregard the problems caused by the
Indonesian Bank Restructuring Agency (IBRA), the implementation
of the Bank Indonesia liquidity support loans that is laden with
embezzlement as well as all the basic problems arising from both
of the above in the state budget, especially the huge interest
payments for government bonds.
Neither do I overlook the dilemma of enormous foreign loans,
especially when related to the fact that in 2004 we will not ask
for assistance from the International Monetary Fund (IMF) to
reduce budget deficits or payment of foreign loans.
Yet all of these concerns are meaningless if we do not attend to
the possibility of disintegration and economic failure that are
caused by our own failure in executing regional autonomy. This
does not include the ethnic, tribal or religious conflicts that
are not connected to regional autonomy.
It would be totally unrealistic to discuss the Indonesian economy
without taking into account the economic condition of places such
as Bali, Southeastern Sulawesi, Labuhan Batu Medan regency and
East Kutai regency in East Kalimantan.
The national economy is not merely about listing the economic
condition of the regions, and the provincial economy is also not
the result of a rote totaling of the economy of the regencies and
city administrations in a particular province.
Indeed, the science of regional economy has taught us how to make
accurate calculations relation to the country's economy as a
whole. This is not about a scientific discussion on the
relationship between regional and national economy, but examining
certain dynamics with implications that are not well understood
by most of us.
We often make statements on the importance of developing our
human resources. The human resources development data is
generally limited to the national statistics data on the level of
education and type of occupation of our citizens. No less
important is the understanding of human resources in relation to
some very basic aspects, such as the education and health status
of each individual citizen in a nation.
In this connection, the services provided by the United Nations
and the National Development Planning Board in recording the
Human Development Index are highly commendable. However, how to
use all this data in the right context to decide the correct
economy for a nation has not been considered by most of those in
the government.
It is precisely in this context that a study about regional
autonomy, especially Law No. 25 on regional finances, is central,
with some prominent areas to be taken care of. There is no
direction from the central government on the priorities of using
the provincial as well as the regional/city budgets. Though the
available funds are not too small, very often no allocations are
made for elementary schools or public health clinics.
Meanwhile, due to reasons of limited funds, allocations for both
elementary schools and public health clinics are also very small
in various cities and regions. Although fund limitations can be
understood in provinces like West and East Nusa Tenggara, there
is an inexplicable setting of priorities, with increases in
salaries for legislative councilors still taking place and
allowances for governors and regional executives continuing
without review.
Here is the glaring misallocation of regional budgets, which has
nothing to do with the national budget that is handicapped by the
huge payments of interest on government bonds. The regional
budget that does not carry the burden of paying foreign loans is
enjoying these foreign loans in the form of various projects in
the regions.
It must be acknowledged that there have been great efforts in the
regions to increase the general fund allocation and the regional
original income, as well as various special funds allocation. On
the other hand, there is no fiscal discipline in using the
budget.
We can clearly detect why there is a great movement to expand the
regions, because by such expansions there will be more provinces
-- meaning more governors and a greater number of local
legislative councilors, and more regencies and cities - which
translates into more regents, mayors and councilors at the level
of regional and city legislative assemblies.
If we let this happen, there will be the loss of trillions of
rupiah for salaries, allowances and all sorts of routine expenses
for the new bureaucrats of legislation and executive at the local
levels.
What will be left for the people?
There are media reports lamenting decrepit elementary school
buildings in the provinces. What is more terrifying than the
physical condition of the schools is the output in the form of
elementary school graduates with minimal capacity, both knowledge
and skill-wise.
Abundant reports are available on the thousands of public health
clinics that have no antibiotics, and public hospitals lacking
the most basic facilities, attesting to the terrible condition of
healthcare in the country.
It is different from the country's situation in the 1980s and the
1990s, when even as income from oil exports and foreign loans
were embezzled, new elementary schools were built and public
health clinics were able to secure sufficient supplies of
medicines from state-owned companies like PT Indofarma that
produced a number of essential medicines.
It seems clear that we are preparing to embark on the destruction
process of our nation if there are no meaningful changes in the
way we view the regions, which require budgets with clear-cut
priorities to fulfill the basic requirements of the people.
Of course, that does not mean a disregard for the very real
problems in the regions, such as the investment climate and
institutional problems connected to the legislative and executive
bodies, all of which need changes and much hard work.
Ultimately, the success of the future president of Indonesia will
be based on the ability to cope in overcoming the most basic
problems faced by the regions and improving the welfare of the
people.
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