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Jakarta Post

Cutting back bureaucracy

  • Eko Prasojo

    The Jakarta Post

Jakarta   /   Mon, February 16, 2015   /  06:53 am

The polemic on wasteful and inefficient bureaucracy has resurfaced after Administrative and Bureaucratic Reform Minister Yuddy Chrisnandi issued a circular that banned the holding of meetings and other government events in hotels as from Dec. 1, 2014.

Although not new, the cost-cutting measure deserves appreciation. In 2004, then president Susilo Bambang Yudhoyono issued an instruction that mandated prudent and modest lifestyles for government officials. Now what is the current state of Indonesia'€™s inefficient bureaucracy and what must we do about it?

The government has been aware of the inefficient state of the bureaucracy for a long time. In addition to the huge spending on salaries, there are a number of unnecessary programs and activities that drain administrative funds.

The Political Economic Risk and Consultancy (PERC) 2012 report scored Indonesia'€™s Bureaucracy Efficiency Index at 8.37 from the worst level of 10, indicating extreme inefficiency in the Indonesian bureaucracy.

The problem lies in the fact that inefficiency is a systemic disease, rather than individual one. The culture has been cultivated and has shaped the bureaucracy and mentality of bureaucrats.

Indonesia'€™s inefficient bureaucracy stems from several causes. First, the overly bulky organizational structure in the ministerial offices, government institutions as well as local governments, which does not in any way reflect the real main duties and functions. Furthermore, the duties often overlap and are seriously fragmented.

At the national level, for instance, along with 34 ministries, there are 28 non-ministerial government agencies (LPNK) and 91 non-structural agencies (LNS).

This bulky structure requires a big budget to run all the programs and activities and pay for salaries, benefits, facilities, business trips, honorariums and other personal needs. This is quite apart from the potential wastage that may take place and overlapping programs and activities.

The Administrative and Bureaucratic Reform Ministry conducted several in-depth studies (2012-2014) into this bulky structure. Using the machinery of government methodology, the deputy for institutions at the ministry studied and analyzed 47 affairs mandated by Law No. 39/2007 on state ministries, together with detailing sub-affairs, as well as studying the government mandate in over 200 laws and regulations.

In addition, the team also paid serious attention to various current issues pertaining to government processes as well as major challenges they faced, including globalization and the ASEAN Economic Community (AEC).

The study revealed that other than being bulky, the current organizational structure of ministries and agencies is both inefficient and ineffective. Administrative affairs are not run coherently, lack synergy and are not well-connected or synchronized. Duplication of functions and duties is commonplace.

Another finding shows that the national government structure changed and grew even fatter after decentralization in 1999.

During the period of 2011-2014, it was found that there were approximately 20 proposals from ministries/agencies submitted to the Administrative and Bureaucratic Reform Ministry on promotion, formation of new organizational units, technical implementation units and new non-structural agencies per month.

As deputy minister of administrative reforms (2011-2014), who chaired the National Team for Ministry and Agency Restructuring, I presided over meetings with the Agriculture Ministry, the Industry Ministry and Trade Ministry to discuss sub-affairs of primary agricultural industry. This sub-affair processes encountered organizational and authority problems: there is neither synergy nor connection among the three ministries.

In the case of demography, the collection of data related to births and mortality falls under the National Family Planning Agency (BKKBN), population mobility with the Manpower and Transmigration Ministry and demographic administration functions with the Home Affairs Ministry.

Other than proposing a reduction in the number of ministries to between 26 and 30, the team proposed the rationalization and re-grouping of directorates general in various line ministries.

The team even proposed the removal or merger of some directorates general in the home affairs, health, agriculture, education and social services ministries to boost efficiency and effectiveness.

If the rationalization of organizational structure can be performed by the current government, I am convinced many government efficiency-enhancement programs can be achieved and state funds can be saved. The second source of bureaucratic inefficiency in Indonesia is the lack of performance management by the bureaucracy.

Much of government expenditure is not necessarily relevant to the targeted performance and even the process of administering activities has become more important than the actual results.

In performance management, the program/activity that is planned and undertaken by an agency should be directed to achieve the targeted performance. The inability to link instruments or methods with goals wastes money.

Conducting business trips and holding meetings in hotels (out of town) is considered a source of extra income, although undeniably the facilities accelerate the meeting process. A short-term solution to this problem is actually easy, such as removing the funds for those purposes.

However, for the long run the problem should be addressed by applying performance management and Position/Post-based Income Enhancement (based on work load, responsibility attached to position, and job risk) and organizational as well as individual performance achievement, without undermining the importance of improved salary.

In reforming the bureaucracy, the government should not be trapped by the iceberg phenomenon: What appears on the surface is only the symptom of bigger issues within the structure, culture and processes underneath, which are deeply rooted.

Fundamental bureaucratic change is definitely not an overnight job. It may even take three to four presidential terms to realize.

However, it is work that cannot be delayed. Restructuring, either mergers or abolition, and changes in organizational processes both internally and between ministries and agencies should top the agenda of President Joko '€œJokowi'€ Widodo and Vice President Jusuf Kalla. Performance management with major performance indicators for ministries and agencies and for each individual must be developed and enacted as soon as possible.

If necessary, a second career opportunity might be provided for by granting early retirement options for civil servants to mitigate the restructuring impact.

The salary system needs total reform to performance-based through strengthening of open recruitment and promotion.


The current organizational structure of ministries and agencies is both inefficient and ineffective.


The writer, former deputy administrative and bureaucratic reform minister, is a professor of public administration at the University of Indonesia and chairman of Indonesian Association of Public Administration (IAPA).

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