With Decentralized Power Comes Graft

By Yeremia Sukoyo & Usmin on 9:08 am July 22, 2013.


Riau Governor Rusli Zainal, center, became the latest
of nearly 300 regional heads to be arrested for graft since
1999. (JG Photo/Marcel Kataren)

Jakarta/Bengkulu. The advent of regional autonomy more than a decade ago has given rise to highly corrupt local cabals who have misappropriated Rp 2.2 trillion ($218.5 million) in public funds since 2008, watchdogs say.

Uchok Sky Khadafi, the director of investigations and advocacy at the Indonesian Forum for Budget Transparency (Fitra), said at a discussion over the weekend that the figure for the state losses was based on a report published by the Supreme Audit Agency (BPK) about regional funding from 2008 to 2012.

Fitra attributed the losses to 9,312 cases of corruption nationwide during that period, and identified North Sumatra as accounting for the largest amount of misappropriated money, followed by Aceh, West Papua and Jakarta.

Boni Hargens, a political expert at the University of Indonesia, said at the discussion that the figure was not surprising, and argued that one of the major negative impacts of decentralization and regional autonomy was to dilute corruption from the central government and trickle it down to regional authorities.

He added that these local officials often had connections to political parties, businesses, organized crime groups and security forces, and that together they formed a cabal that was responsible for massive levels of corruption.

“These local bosses have formed their own system, a feudal one, in which they control virtually all lines of regional funding,” Boni said.

Political corruption, he went on, constituted a large part of this system, under which those in power sought to enrich themselves and their cronies by abusing their position.

“These guys control nearly all the political processes at the local level, from preparations for elections to running the local government,” he said.

Karyono Wibowo, a senior researcher at the Indonesian Public Institute, a think tank, said a major factor for the level of corruption in the regions was the high cost of running for and staying in public office.

“It’s this high cost that compels elected officials to commit corruption” to recoup their money, he said at the discussion.

He added that running for mayor or district head required candidates to spend at least Rp 5 billion, according to estimates by IPI.

“In some areas, the cost can go up to Rp 20 billion or even Rp 50 billion. It all depends on the region’s economic potential,” Karyono said.

Running for governor can cost upward of Rp 100 million, he added.

Home Affairs Minister Gamawan Fauzi has acknowledged the problem, revealing earlier this month that 298 governors, district heads and mayors had been jailed since regional autonomy was introduced in 1999.

“Since the start of the reform era, we’ve seen many regional heads go to jail for a range of crimes,” he said in Bengkulu on July 4.

“It always saddens me to hear of such cases. I often wonder what the problem is in our system that we have hundreds of officials getting mired in legal problems and going to jail.”
He was speaking at the inauguration of Sultan Najamuddin as the deputy governor of Bengkulu. Sultan’s older brother, Agusrin, the former governor, was in January 2012 convicted of corruption and sentenced to four years in prison.

Free convicts
The latest regional head implicated in a criminal case is Rusli Zainal, the governor of Riau, who was arrested by the Corruption Eradication Commission (KPK) last month after being named a suspect on three counts of corruption.

Despite his arrest, he remains a public official, with the Home Affairs Ministry saying it cannot suspend or remove him until he is convicted.

Another Sumatran official currently serving time for graft is Syamsul Arifin, the former governor of North Sumatra, who in August 2011 was convicted of embezzling Rp 98.7 billion while serving as the head of the district of Langkat, and sentenced to 30 months in prison.

In the cases of both Agusrin and Syamsul, the convicts enjoyed several months of freedom before they were incarcerated, during which they also retained their official seats.

To date, 149 regional heads have been convicted of corruption, according to Indonesia Corruption Watch.

Adnan Pandu Praja, a deputy chairman of the KPK, expressed concern earlier this month that corruption in Indonesia had become a way of life and considered culturally acceptable.

“We need to build a culture where the whole family feels ashamed to be related to someone who commits graft,” he said at a university discussion in Bogor on July 6.

Adnan said his plea was motivated by the fact that the incidence of corruption remained as high as it did when the KPK was formed in 2002.

Resource graft

Donal Fariz, an ICW researcher, said last month that the pattern of regional corruption varied according to each region’s natural and mineral resources potential.

In areas rich in such resources, much of the corruption centers on the issuance of concessions for logging, plantations and mining. But in areas with few resources, the embezzlement and misappropriation of the regional budget is the biggest form of corruption.

“Regional corruption really boomed after power was decentralized from Jakarta to the regions, and the flow of money followed,” Donal said on June 27.

“The problem has grown progressively worse because regional heads are trying to outspend their challengers during elections, and they’re not making that much from their government salary. That’s a factor for the high incidence of corruption among regional officials.”

ICW says corruption in the natural resources sector is an “unlimited” font of ill-gotten wealth that will only run dry when the precious resources have been completely exhausted.

Tama Satrya Langkun, an ICW researcher, said last month that while other forms of corruption, such as embezzling funds from regional budgets, could realistically be ended, this was not true of resource-related graft in the forestry and mining sectors.

“The embezzlement of regional budgets can be tackled, I’m sure of that. When the money runs out, the corruption ends,” Tama said on June 16.

“But with natural resources, it doesn’t end until the resources have run out, which is what makes it an essentially unlimited form of corruption.”

He cited claims by activists that losses from corruption in the forestry sector had boomed from Rp 7 billion in 2003 to Rp 273 trillion in 2011.

The claims were first made last month by a group calling itself the Anti-Forestry Mafia Coalition, and which includes ICW, based on data published last year by the Forestry Ministry.

Wilmar Tumpak Hutabarat, a representative for the coalition, said the figure of Rp 273 trillion stemmed from possible irregularities or infractions in the issuance of permits for 727 plantations and 1,722 mining sites in just seven provinces.

Wilmar said the biggest potential losses were recorded in Central Kalimantan, at Rp 158 trillion, followed by West Kalimantan at Rp 47.5 trillion, East Kalimantan at Rp 31.5 trillion and South Kalimantan at Rp 9.6 trillion.

He added that a separate estimate by the KPK had pegged the combined potential losses from corruption in the forestry sector in those four provinces at no less than Rp 15.9 trillion a year.

The coalition has submitted its claim about the losses to the KPK, demanding a thorough investigation into all forms of corruption in the forestry, plantations and mining sectors.

Tama said the coalition had linked a spike in the number of suspect concessions being approved to the run-up for elections, and warned that there could be another surge in forestry-related corruption ahead of the legislative and presidential elections next year.

“In 2009, which was an election year, there was a more than 200 percent increase in the number of permits issued for coal mining and plantation operations,” he said.

“That’s something we have to keep an eye on, because it seems that national political developments can open the door to companies to plunder the country’s natural resources.”

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