Indonesia Consultative Group Meeting
Tokyo, October 17-18, 2000Statement of GTZ (German Technical Co-operation)
On Conclusions of the Pre-CGI Meeting
regarding
Donor Support for Decentralization and Local Governance
Mr. Chairman,
Representatives of the Government of Indonesia,
Delegates of the member countries of the CGI,
Ladies and Gentlemen,
First of all I would like to express the appreciation of the donor community for the efforts of the Government of Indonesia in organizing the Pre-CGI Meeting on Decentralization which took place in Jakarta on 13 October. At that meeting, the Government comprehensively briefed the participants on the decentralization policy, its background and its objectives. Donor representatives took note of the detailed work plan developed by the Government for implementing the decentralization laws by January 2001. The meeting allowed for a necessary and constructive exchange of views and opinions between the Government and the bi- and multilateral donors on various aspects of the decentralization policy.
The statements of Government representatives at the Pre-CGI meeting helped donors to understand the imperatives of the decentralization policy, and to put regional autonomy in the context of the ongoing process of political reform and democratization. Donors recognize the importance which the Government places on the successful implementation of the decentralization policy as part of the overall reform programme. None of the donors questioned the need for decentralization as an instrument to support the establishment of a democratic culture in Indonesia.
The Government frankly addressed the open issues and the risks involved in implementing such a broad-based decentralization program in such a short period of time. During the meeting, donors candidly exposed their views on outstanding issues and asked for clarification from the Government. The Minister has mentioned the most important issues in his speech, so there is no need for me to repeat them here. Again, the open and realistic approach of the Government as experienced during the Pre-CGI Meeting opens the ways for a constructive engagement of the donor community to provide support and advise on the decentralization process if and where requested by the Government.
Ladies and Gentlemen,
Accomplishing decentralization and regional autonomy will take time. January 2001 is only the starting point for a new decentralized and more democratic system of local governance which will require numerous adjustments of institutions, working mechanisms and processes at all levels of government. I would like to take this opportunity to address some of the issues where from our perspective capacity building initiatives to make the policy succeed are most needed. The Chairman of the National Development Planning Agency (BAPPENAS) has in his presentation on the occasion of the Pre-CGI Meeting listed a number of programme areas that are also contained in the Draft Final Report of the joint GTZ/USAID Capacity Building Needs Assessment study (CBNA) which was distributed at the Pre-CGI Meeting.
In the immediate future, there is a need to support the finalization of the regulatory framework for regional autonomy. There is a need to support the transition period by ensuring the close co-ordination between the central government agencies involved, and by quickly identifying emerging problems. Ensuring a smooth transfer of a big number of staff to the regions and preventing disruptions of essential social services are key issues, as is the need to urgently implement local government budget and finance management reforms to safeguard transparency, public participation and a prudent use of considerably increased local expenditure authority. In the medium term, capacity building initiatives must cover a wide range of issues, starting from a review in each sector to make sure that sectoral systems and procedures are in line with the decentralized system of government, up to the need to strengthen interregional co-operation as a new level to provide public services, to formulate policies and to support local governments.
In building capacity to implement the new framework for regional autonomy, donors have to make sure that efforts are used effectively and efficiently. There is a need to support intermediary institutions which can implement capacity building programmes and work directly with local governments, such as associations of regional governments, professional associations, and public and private training institutes. In view of the diversity of regional governments in Indonesia, we are convinced that standard programmes, which are applied to all regions uniformly and without adjustment to the specific conditions in each region, will fail to have a lasting and sustainable effect on capacity building. Tools and instruments (like training programmes for key areas of public services, advisory and consultancy services, information systems) have to be developed which can be used in a variety of programmes and situations. Capacity building does not necessarily mean that everything has to be invented anew - in many cases available instruments have only to be adjusted to the new policy framework. For instance the Government is providing training programmes on urban management and on financial management to local government officials - these programmes need only to be updated and revised. In many areas technical skills and expertise are available at the local level. What is missing is the managerial capacity, the capacity to develop coherent local policies, to determine priorities for investment and development and the capacity to involve the local communities and the users of public services in the decision-making process.
Capacity building in the context of the decentralization policy is a medium term effort. We support the Government's suggestion to have a post-CGI meeting later in November to map out key areas where donors can support capacity building programmes of the central and regional governments. Such a concerted effort however requires a firm commitment from both sides: the Government has to ensure consistency of decentralization-related policies and has to establish the proper institutional and procedural framework for monitoring and adjusting capacity building programmes. Donors have to furnish technical and financial support over a medium-term period in a well-co-ordinated way, and have to increase the mutual exchange of information, of tools and instruments for capacity building, and of lessons learnt. Under such conditions, capacity-building programmes can support achieving the main objective of the decentralization policy: a democratic local governance system that reflects the needs and aspirations of the local communities and gives them the means to influence national policies.
Thank you very much for your attention.
Dr. Bernhard May
GTZ Project Coordinator
Decentralization and Local Governance