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55 4 Tracing the Progress of Local Governments since Decentralisation I Ketut Putra Erawan Formally launched in 2001, the decentralisation of governmental authority is one of the most important reform programs in Indonesia. Both supporters and critics of the program acknowledge that decentralisation has changed the landscape of the central–local political relationship. However , a closer examination of the effects of decentralisation reveals significant variations across the country. Recent research indicates local state capture and rampant corruption in some jurisdictions, but deepening democracy and the emergence of effective government in others. What explains these variations in outcomes across Indonesia? What conditions are shaping the experiences of local governments with decentralisation? And, at this early stage, what conclusions can we draw about the gains and losses associated with decentralisation? In this chapter I investigate some of the factors determining decentralisation outcomes at the local level. I identify some of the gains and losses associated with decentralisation and explain the conditions shaping these. Based on an examination of how decentralisation has actually been implemented in four localities, I argue: (1) that decentralisation should be viewed as an extended process; (2) that the power and interaction of state and societal actors at the local level, as well as the penetration of national and international actors, are salient factors determining the trajectory and outcome of decentralisation in particular localities; and (3) that these interactions happen iteratively and are shaped by the local political–economic context. I focus on three districts and one municipality : the district of Bangka in the recently created province of BankaBelitung , the district of Bantul in Yogyakarta, the district of Jembrana 56   I Ketut Putra Erawan in Bali, and the city of Mataram (the capital of West Nusa Tenggara) in Lombok. They were chosen to highlight the wide variations that exist in the extent to which local governments have adapted to the new political framework. Viewing decentralisation as a process that takes time to evolve—rather than as a condition that exists fully formed from the outset—allows us to explore the impact of both local actors and contextual factors in shaping the experience and outcome of decentralisation at the local level. It will be argued here that the same national decentralisation program has generated widely varying experiences across Indonesia. These variations are mainly explained by differences in the capacity of local actors to respond to political, societal and institutional conditions in their localities. It is important to assess the role of local actors, not only because they are significant in creating the strategic programs for the implementation of decentralisation, but, more importantly, because they play a pivotal role in shaping the political environment that determines the extent of possible innovation and reform. If they are to succeed in shaping the political environment, local leaders must take control of the policy-making process by creating effective coalitions among political parties. But this is not enough; they must also enhance their engagement with the electorate and society, to build community support for their policies and programs. Unless they can meet these conditions, they are unlikely to be able to protect their reform initiatives from partisan interests in and around government. According to Geddes (1994: 46–7), these include ‘political activists accustomed to distributing jobs in return for political support and employees who got their jobs that way, and whose status is threatened by the change to a merit-based system’. She continues: Members of Congress may use funds for pet projects from which they derive electoral benefits, or officials in the finance ministry may informally reallocate funds to serve more pressing political needs. The separation of the funding process from the traditional political game may be necessary in order to prevent funds allocated for development projects from being used for other purposes … If bureaucrats form part of the political exchange network, their own success will be linked to that of particular politicians, and they will have compelling reasons to make decisions that maximize support for their patrons rather than furthering agency goals (Geddes 1994: 47). To minimise the risk of capture, rent seeking and free riding, Geddes advises local leaders to insulate their programs from the demands of ‘the individuals most capable of undermining state efforts to initiate change’, namely ‘politicians, party activists, and bureaucrats intent on “spending ” scarce state resources to “buy” political support’ (Geddes 1994: 82). She introduces the notion of insulation to refer to the act of responding [3.14.6.194] Project MUSE (2024-04-25 16:53...

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