It's Time to Reorient Regional Autonomy

The "Kompas" R&D poll shows that 28 years of regional autonomy is still faced with a number of problems. What's that?

KOMPAS/ZULKARNAINI

Students cross a suspension bridge in Siron Village, Cot Glie District, Aceh Besar Regency, Aceh Province on Thursday (16/3/2023). The construction of the bridge was funded by the State Revenue and Expenditure Budget of Rp 4.4 billion in 2022.

Over a quarter century of regional autonomy, much progress has been achieved. Regional autonomy gives full authority to regional governments to regulate and manage the interests of local communities according to their own initiatives based on community aspirations. Many people are enjoying the results now.

The results of the Kompas R&D poll on April 23-25 ​​2024 showed that the majority of respondents (83.4 percent) agreed that regional autonomy had made development more equitable throughout the country. Apart from that, as many as 84.3 percent of respondents stated that regional autonomy had made public services better.

Regional autonomy is actually intended to shorten the government's control span by serving the needs of the community as closely as possible. That is also the reason for the occurrence of the expansion of regions. After many regions were expanded, as of 2023, the administrative regions in Indonesia, according to the Central Statistics Agency, have increased to 38 provinces, 416 regencies, and 98 cities.

When viewed by region, opinions regarding equal distribution of development and public services differ based on the Java and non-Java dichotomy. It appears that the benefits of regional autonomy are perceived differently by communities in Java and outside of Java.

Also read: History of Regional Autonomy Policy

KOMPAS/AGUS SUSANTO

Papua Bangkit Main Stadium and athletics arena in Jayapura, Papua, Saturday (29/2/2020).

A total of 89.8 percent of respondents in Java stated that regional autonomy has made development more evenly distributed. Although in agreement, the percentage of approval for that opinion from respondents outside of Java is lower, at 75.6 percent.

However, when evaluating regional autonomy and its impact on public services, the percentage of respondents from Java who believe that it has resulted in improvements is lower, at 79.6%. Meanwhile, the percentage of respondents from outside Java who hold this belief is higher, at 90.1%. It can be said that the proliferation of regions outside Java has contributed and provided greater benefits for the community.

The public also considers the performance of local governments to be fairly good in carrying out regional autonomy, especially in addressing local issues and increasing regional income to fund development.

A total of 55.4 percent of respondents stated that the performance of the local government has been good in addressing regional issues, while 21.4 percent said it has been getting better. Only 27.9 percent expressed the opposite, stating it has been bad or getting worse.

Also read: Black Hole of Regional Autonomy

Participants of the hearing are taking a group photo after attending a public hearing with the DPR Commission II regarding the expansion of new autonomous regions at the Parliament Complex, Senayan, Jakarta, on Tuesday (12/11/2019).

Regarding regional finance, 74.4 percent of respondents stated that their local government has been working well and improving in increasing local revenue. However, there are still around 21 percent who say otherwise, that it is poor and getting worse.

Main problem

However, regional autonomy is still faced with a problem that is not easy, namely improving the welfare of the people in the region. When asked what the main problems were in the region, the largest portion of respondents' answers was about poverty (26.7 percent) and unemployment (23.8 percent).

These two issues are still national issues. Although the poverty rate has continued to decrease in the past two decades, from 16.62 percent (2004) to 9.36 percent (March 2023), many provinces still have poverty rates above the national average.

Nearly half of the provinces, or 16 provinces, still have high poverty rates. Some of them are Aceh (14.45 percent), East Nusa Tenggara (19.96 percent), Gorontalo (15.15 percent), Maluku (16.42 percent), West Papua (20.49 percent), and Papua (26.03 percent).

In Java Island, which has more advanced development, there are still three provinces with poverty rates above the national rate. Those three provinces are Central Java (10.77 percent), Yogyakarta Special Region (11.04 percent), and East Java (10.35 percent).

The same goes for the issue of unemployment that contributes to poverty. Despite the continuous decrease in unemployment rates over the past two decades, from 9.86 percent in 2004 to 5.32 percent in August 2023, there are still 10 provinces with high levels of unemployment.

This condition indicates the need for a reorientation of the implementation of regional autonomy. Initially, it focused on improving governance by equalizing development and improving public services, towards improving the welfare of the people. The resources possessed by the region, both natural and human resources, and the support from the central government, should be directed as much as possible towards the welfare of the people.

Regional dependency

Although appreciated well, regional autonomy does not run without financial consequences. Along with the delegation of authority for regions to be able to manage their respective communities' interests, there is a fiscal burden borne by the country in supporting regional independence.

KOMPAS/HENDRA A SETYAWAN

Construction of the Karian Dam in Pasir Tanjung Village, Lebak, Banten, Sunday (17/9/2023).

The public also perceives that there is a dependence of regions on balance funds transferred from the center. As many as 62.5 percent of respondents stated that regional autonomy has created a dependence of regions on the center in terms of finance. Meanwhile, 33.7 percent of other respondents stated the opposite.

The government disburses balancing funds that increase in amount every year. Referring to data from the Ministry of Finance, every year the balancing funds, or now known as transfer funds to regions, includes revenue-sharing funds (DBH), general allocation funds (DAU), special allocation funds (DAK), special autonomy funds (for Papua, Aceh, and additional infrastructure funds in the context of special autonomy), DI Yogyakarta's special funds, village funds, and fiscal incentives.

The amount of transfer funds to regions for 2024 is recorded at IDR 857.6 trillion or 25.8% of total state expenditures. This amount is a 5.5% increase compared to pre-Covid-19 times (2019) which recorded IDR 813 trillion.

By analyzing the local government revenue and expenditure budget (APBD) for the year 2023 from 508 districts/cities in Indonesia, outside of DKI Jakarta's administrative area, it can be seen that there is a high dependence on transfer funds from the central government, reaching 79.4 percent.

This high fiscal dependence is obtained by comparing transfer funds from the central government to regional income.

Also read: Initiating a Pro-autonomy Cabinet

KOMPAS/P RADITYA MAHENDRA YASA

Heavy machinery amidst a pile of bamboo, which is part of the initial construction phase of the Sayung-Kaligawe toll road in Sayung District, Demak Regency, Central Java, on Wednesday (17/4/2024).

The figure of 79.4 percent indicates that local financial sources are dominated by funds obtained from the central government. Even for regions in eastern Indonesia, the level of dependency on funds from the center reaches 90 percent. This means that the amount of funds gathered by regional governments entering the local revenue share is relatively small, at around 20 percent or even below that.

From the above exposition, it can be concluded that in addition to the success of leveling the development and improving public services, there are at least two problems surrounding the implementation of regional autonomy.

The issue at hand is, firstly, regional autonomy that has yet to improve the people's welfare. Secondly, the relationship between the central government and regions that creates a high fiscal dependency on the central government.