Regional autonomy: future uncertain

Down to Earth No 51 November 2001

Megawati Soekarnoputri's new government is citing the threat of national disintegration as the reason for scaling down decentralisation.

Newly installed president Megawati has identified regional autonomy - Indonesia's decentralisation process launched in January this year - as a key issue in building democracy in the country. She told a Washington meeting in September that Indonesia was determined to carry out important programmes "such as decentralisation of some of the powers of the central government to the regional governments".

Back in Indonesia, however, this determination is not so evident. Instead, the whole future of the autonomy project has been thrown into doubt because Megawati and key ministers in her cabinet see it as a threat to national unity. They have been lining up to criticise regional autonomy as part of a concerted campaign to convince the Indonesian public of the need for major revisions. While stating that decentralisation must continue according to the law, Sudarsono, director general for regional autonomy at the home affairs ministry, said in September that "the concept deviates from the unitary state principle…We don't want to see regions developing into independent entities within the Indonesian state…" He said the government is deeply concerned about the "arrogance of resources-rich regions and their egoism and racist policies". Newly-appointed minister of home affairs Hari Sabarno agrees: among some resource rich regions, he said, "there seems to be a hidden mission to separate from the unitary state some time in the future." Mining minister Purnomo Yusgiantoro - who also served under Wahid - has repeatedly warned that autonomy is scaring off investors in the lucrative mining, oil and gas sectors. The new Vice-President, Hamzah Haz, is a known anti-autonomy figure and Megawati herself is strongly nationalist with close ties to the military.

Indonesia as "NKRI" or a unitary state - was the principle hammered home by the anti-autonomy elements of former president Wahid's government. One of its main proponents was the highly-militarised home affairs department which was put in charge of decentralisation when the regional autonomy ministry was scrapped last year. The new minister, Sabarno, a retired army lieutenant-general, continues the military influence in this department. As Wahid's influence on policy-making waned during his short presidency, calls for a revision of regional autonomy became stronger and, earlier this year, he agreed to a review of Laws 22 and 25 - the main autonomy laws, passed in 1999. This review is being pursued vigorously by the Megawati administration and a November 2001 deadline has been set to complete the amendments to the laws.

One of the main proposed changes is the re-establishment of the government hierarchy from central government down through provinces, districts and municipalities, sub-districts and villages. Currently, district level governments are the main beneficiaries of the transfer of power from centre to regions. They also receive the greater share of the regional allocation of resource revenues. The non-hierarchical relationship - particularly between provinces and districts - has led to provincial governors complaining that they have been left without authority and are not even informed any longer about what's going on in their areas.

Ironically, district level governments were originally chosen as the main targets for the transfer of authority because it was thought then that strengthening the larger provincial governments might foster regional identities and encourage separatist tendencies.

The proposed change has provoked a strong reaction from the district governments who fear their new-found authority is about to be severely restricted. District heads (Bupatis) have countered Jakarta's accusations of power abuse by accusing central government of reluctance to relinquish control. Head of the Bupatis' association Syaukani said he would challenge any amendments, to which Sabarno replied that the Bupatis had no right to do so. This sets the tone for what may well turn into a bitter struggle in coming months.

Dr Afan Gaffar, a pro-autonomy academic from Gadjah Mada University who helped design the 1999 laws, has pointed to the central government's motivation for retaining power: "All the ministries in Jakarta are hesitant to give away powers, because many officials still have interests at the local level and want to protect their sources of private revenue."

Others have pointed out that anti-decentralisation voices are blaming a whole host of problems - like disputes between fishing communities and illegal sand-mining activities - on regional autonomy, when these problems existed long before autonomy was introduced.

The central government has been highly critical of the local regulations (Perda) that have been passed by regional parliaments - especially those that impose taxes on businesses operating in their areas. According to Sabarno, up to August this year his office had received at least 1,979 of these of which 1,053 concerned taxes. Although 926 of the regulations met the required standards, 104 did not. A further 949 were still being evaluated, he said. The industry and trade department is in discussion with regional governments, according to minister Rini Soewandi, over 1,006 local regulations which are considered damaging to business.

Taxes and revenues are central to the power struggle between the districts and Jakarta. Regional governments are angry that the distribution of resource revenues is still going through Jakarta - leading to delays in the transfer of funds as well as suspicions that the full amount may not be handed over. Local governments, which are not permitted to borrow money, see their own tax-raising initiatives as a means of asserting local control, but this is putting off investors who complain of being taxed twice over. It is also by no means clear that poor districts are getting enough funds to fulfil basic needs.

Other problems include overlapping regulations - with contradictory rulings from district and provincial governments causing confusion.

(Jakarta Post 18/Aug/01; Kompas 16/Aug/01; Straits Times 13/Aug/01; 6/Sep/01; unsourced report via Sawitwatch 24 & 28/Aug/01)



Where does all this leave ordinary people? Gains have been made from regional autonomy in some areas. In Wonosobo district, Central Java, for example, local communities and supporting NGOs have been working with the local assembly to draft a regulation on community-based forest resource management. The regulation, passed in October, allows for the district head to issue licences to communities to manage areas of state-owned forest in a sustainable manner. In Gorontalo, Sulawesi, a fishing community, assisted by local NGOs and sympathetic officials in this newly-created province, has succeeded in regaining control over their traditional fishing grounds ( see coastal resources article for more details).

In other areas, however, regional autonomy has made local people worse off: some Bupatis have sanctioned a huge increase in natural resource extraction in their areas - a process which is accelerating forest loss and conflicts over land. District governments are also being tempted by offers of contributions to local budgets from state-owned forestry and plantation companies.

In East Kalimantan district heads have been issuing hundreds of licences for small-scale 100 ha logging concessions at between Rp 50 million and Rp 100 million a time. Timber barons whose licences for larger concessions have run out are now manipulating small groups of local people to set up co-operatives in order to get logging licences. These co-ops then act as fronts for the timber barons' continued logging operations, enabling them to keep their sawmills running. Local communities may make small short-term gains from the small payments they receive, but their long-term resource security is destroyed. There are similar reports from other parts of Indonesia.

A September workshop in West Kutai, East Kalimantan, identified at least 250 conflicts in the district arising from a failure to gain recognition for customary lands, overlapping land claims, clashing claims by old and new forest permit holders and conflicts between concessionaires and local communities. Speakers at the workshop said the deteriorating situation in the forests was having a negative impact on the local economy, as local people were pushed towards a consumer lifestyle. Local Bupati Rama Asia, under attack for issuing small-scale licences - there are already 622 in this district alone - blamed forest destruction on the bigger, Jakarta-based logging concessionaires.

The forestry ministry is now reported to be in the process of cancelling a decree issued last year, which transfers responsibility for handling larger forest concessions to regional governments. An earlier ban on regional heads issuing small-scale licences has been widely ignored by district authorities.

Civil society groups are calling for regional autonomy to be put back on track - to ensure that the original aims of strengthening local democracy and fostering good governance are not forgotten in the rush to make profits from natural resources.

(ABC 11/Aug/01; Tempo Magazine 24-30/Jul/01 - this edition has detailed information about the changing relationship between old-guard timber concessionaires, district heads and local communities under the new decentralised conditions. Bisnis, [no date], forwarded via Sawitwatch on 24/Sep/01;Kompas 26/Sep/01)