Brief Description of the
Country and its National/State Government Structure
In terms of population, Indonesia is the fifth largest country
in the world, consisting of more than 17,000 islands. The country's
population based on the 1990 census was almost 180 million people.
This number is expected to reach 258 million by the year 2018
at the end of the country's second long-term development plan
(1993-2018). There are two problems associated with this. Firstly,
most of the country's population lives on Java and Sumatra. Secondly,
the other islands, comprising the largest land area of the country,
are only inhabited by less than 20 per cent of the total population.
Table 1. Population Trends
Source: Central Bureau of Statistics
The population of Indonesia is increasingly urban. In the 1961
census the urban population of the country was little more than
17 per cent; in the 1990 census, urban population has increased
to 30 per cent. It is estimated that by the year 2000 urban population
will increase to some 40 per cent and that by the year 2018 it
will be more than 51 per cent of the total population. This urban
population will be living in various metropolitan areas (of which
at present there are 6, whereas there would be 16 by the year
2018), e.g. in large cities, in medium cities and in small towns
Table 2. Estimated Number of Urban Settlements
by Size (1990 and 2018)
Number of cities
Small & Others
Source: Central Bureau of Statistics
The increase in the proportion of people living in urban areas
will pose a challenge in providing the needed urban infrastructures,
new employment opportunities, etc. This is more so in the larger
urban settlements than in the smaller ones. Generally speaking,
the provision of infrastructure and services needed by the urban
population of the country is still far from sufficient. Even in
the urban areas part of the population (16 per cent) is still
using kerosene rather than electricity for lighting.
Table 3. Percentages of Household and Living Conditions
Access to facilities
Sources of water
- Private with septic tank
- Private no septic tank
- Other (including none)
Source: National Committee for Habitat II, National
Report for Habitat II, Twenty-Year Shelter Sector Review
The bulk of the country's gross domestic product is produced
on Java and Sumatra. Some other islands seem to perform almost
as well Java and Sumatra, if not better.
Table 4. Gross Regional Domestic Product by Province
(in billions of Rupiah)
Growth rate %
South East Sulawesii
Source: Nota Keuangan dan Rancangan Anggaran Pendapatan
dan Belanja Negara TA 1997-1998
National governmental and
The Constitution of the Republic of Indonesia is usually referred
to as the 1945 Constitution. The fundamental ideas of the Constitution
are that the State is a unitary and seeks to realize social justice
for all the people. Sovereignty is in the hands of the people,
based on democracy and deliberation among the representatives
to reach a consensus. The State is founded upon the belief in
God, so that the government and other authorities are obliged
to nurture the nobility of human character and hold fast to the
moral ideals of the people.
The highest authority of the State is in the hands of Majelis
Permusyawaratan Rakyat (MPR). This is a people's assembly
that exercises the sovereignty of the people, determines the Constitution
and guidelines of State policy and appoints a President and a
Vice President to carry out that State policy. The Majelis
is a representative body and its power is final. The President
is the highest Executive of the government, in whom authority
and responsibility are concentrated. The President acts in concurrence
with the Dewan Perwakilan Rakyat (DPR) or the House of
Representatives in making acts or laws and in determining the
national budget. The President is not responsible to the Dewan,
nor can he dismiss it. Both the President and the Dewan
are responsible to the Majelis but the Dewan
can control the President through the Majelis, since
the members of the Dewan are ex officio members of the
Majelis that can require the President to answer for
his responsibility. Members of the Dewan comprise half
the members of the Majelis.
The Dewan, which can be roughly equated with a Parliament,
is an elective representative body, with a membership, in conformity
with laws, composed of the representatives of the political parties
as well as appointees of the armed forces. The other bodies, in
addition to the President, with whom they have equal standing
are the Supreme Court, the State Audit Board and the Supreme Advisory
Council. They are subordinate only to the Majelis. The
President forms and leads the Cabinet. The President, to whom
they are responsible, appoints the Ministers who lead the ministries.
They are not responsible to the Dewan, which cannot dismiss
them. The Dewan, however, has the right to call the Ministers
to answer members' questions about the conduct of the ministries.
It can also hold a public hearing, in which professional experts
can express their opinion on particular problems in front of the
members of the Dewan. There are two types of Ministers:
Ministers leading the technical or administrative departments
(hereinafter referred to as ministries) and Ministers without
portfolios or departments to lead (State Ministers).
In addition to the national government, article 18 of the 1945
Constitution also provides for the creation, maintenance and development
of local governments in Indonesia and for the enactment of a local
government act. The current law concerning local government in
Indonesia is Act Number 5 of 1974, which is entitled Governance
at Regional Level (hereinafter referred to as the Local Government
Act of 1974). This title is intended to indicate that the territorial
division and sub divisions of Indonesia are not only administered
locally, but also nationally as well as jointly. The entire territory
of the Republic of Indonesia is divided and sub divided with regards
to the principle of deliberation and consensus in administration
and the traditional rights of the regions that have a special
character according to the Constitution. This last provision is
concerned with the great diversity of people constituting the
Indonesian nation. The different ethnic cultural groups not only
have their own customs and dresses, but even languages, cultures
and attitudes that vary from one part of the country to another.
This diversity enriches Indonesia's unity.
The country is divided into autonomous entities and administrative
ones in accordance with the provisions of article 18 of the Constitution.
The autonomous entities are the manifestation of the decentralization
principle, while administrative entities are the manifestation
of the deconcentration principle. According to the provisions
of article 1 of the Act, the decentralization principle is known
as: "The transfer of responsibilities from the central or higher
level government to the lower level government to have its own
autonomous responsibilities". Local autonomy, on the other hand,
is defined as: "The right, authority and responsibility of subnational
entities to regulate and manage their own affairs". According
to the same article, deconcentration is referred to as: "The delegation
of responsibilities from the central government, the Governor,
the Mayor or the Chief of the provincial and local offices of
ministries to their officers at the subnational levels". Under
the decentralization principle, two levels of autonomous entities
are created: autonomous provinces and autonomous localities. These
locality administrations are what we call local governments, while
provincial administration is more associated with the administration
of a region to which, the central government transfers some of
its responsibilities or authorities. Every province except Jakarta
is divided into a number of autonomous localities. Jakarta is
a province and a special territory as it is the seat of the national
government. Therefore, it is not divided into smaller autonomous
regions or localities. Presently there are 27 autonomous provinces
and 300 autonomous local governments.
Under the deconcentration principle, three levels of administrative
regions are created: regions, County or Municipality and Districts.
Thus the country is divided into regions, regions are divided
into County and Municipality and County and Municipality are divided
into Districts. The areas of autonomous provinces and local governments
are necessarily identical to those of the regions and County or
Municipality. Thus an autonomous province is necessarily an administrative
region, while an autonomous locality is necessarily either a County
or a Municipality. However, an administrative entity does not
necessarily have to be an autonomous one. Thus there are several
entities which are merely administrative County or Municipality.
Jakarta, for example, is divided into 5 administrative Municipalities.
Also, under the deconcentration principle, there are two other
smaller entities. One is the so-called Governor, which is an administrative
entity within a County. There are presently only 36 Townships
in the country, so that not all the Counties in the country have
a Governor in their area. The other is District. Thus the County
is divided into regions, a region is divided into County and Municipality,
a County is divided into a Governor (which itself consists of
several Districts) and a number of Districts. A Municipality,
on the other hand, can be only divided into Districts.
The government agency administering the administrative region
is the regional government, while the one administering the autonomous
province is the provincial government. The regional government
consists of a Governor with a secretariat and the regional offices
of central ministries. The provincial government, on the other
hand, consists of the Governor with a secretariat and a number
of departments as well as the provincial House of Representatives.
The Governor of the administrative region is necessarily the Governor
of the autonomous province. As the Governor of the administrative
region, he is the representative of central government, while
as the Governor of the province he is Chief Executive of the autonomous
province. Thus, a Governor has double function. As the central
government representative, his job is to supervise the working
of the autonomous provincial and local governments in his region
and to coordinate the regional offices of ministries.
The County Commissioner or the Mayor of a Municipality is also
the Chief Executive of the respective autonomous local governments.
As the representative of central government, his tasks include
supervising the local government and coordinating the local offices
of ministries, while as the County Commissioner or the Mayor of
the local government he acts as the Chief Executive of his area.
Meanwhile, throughout the country there are 3,605 Districts and
66,974 grass-roots divisions of which 61,924 are villages and
5,055 are urban villages. The first are rural subdivisions where
old forms of democracy are still practised, while the second are
city wards or suburban subdivisions part of Kelamatan.
Evolution of Local Government,
its Legal and Political Background
The evolution of local government in Indonesia can be traced
back to the era of Dutch Colonialism. The Dutch Decentralization
Law of 1903 created local councils for the autonomous Residencies
and Municipalities. Then with the Bestuurshervormingswet of 1922
the area of the country was divided into gouvernementen or provinces.
In 1925 the Council for Residencies was abolished and replaced
with the Council for Regencies. In addition to that the Council
for Provinces was created. The first province established was
the West Java (Jawa Barat) in 1926, East Java (Jawa
Timur) in 1929 and Central Java (Jawa Tengah) in
1930. The Governor chaired the council of a province while the
Regent chaired the Councils of the Regency (similar to a County).
Meanwhile, the council of a Municipality was to be chaired by
a Mayor. Under this act there were 76 Regencies and 32 Municipalities
on Java and 13 Municipalities outside of Java.
Post independence era
Local Government Act 1 (1945)
The 1945 proclamation brought a new system of local government
in Indonesia. The Constitution of 1945 provides for a local government
system and makes it clear that local autonomy is one of the principles
of governance in Indonesia. The article provides for the basic
principle of the local government system: "With regards to the
principle of deliberation and consensus in administration and
with regards to the traditional rights of the regions that have
a special character". The first of a series of laws enacted by
the new republic was the Local Government Act Number 1 (1945),
in which the following provisions were covered:
In each region a Local Board of the
People's Representatives (BPRD) was formed;
The BPRD elects a Chief Executive of
the local government;
The Chief Executive is both a central
government officer as well as a leader of the local government;
Three levels of local government were
created: Residency, County and Municipality.
Local Government Act 22 (1948)
Local government consisted of the House
of Representatives and the Local Advisory Board (LAB);
The Local Advisory Board was headed
by the Chief Executive;
The Local Advisory Board was responsible
to the House of Representatives;
The Chief Executive was both a central
government representative as well as a leader of the local government;
Three levels of autonomous local government
were created: Province, County or Municipality and Village or
Local Government Act 1 (1957)
Local government consisted of the House
of Representatives and the Local Advisory Board;
The local Chief Executive was the leader
of the Local Advisory Board;
Three levels of autonomous local government
were created: first, second and third.
Presidential Decree 6 (1959)
The local Chief Executive was both a
local leader and a central government representative;
The local Chief Executive was not responsible
to the local House of Representatives;
The local Chief Executive was to be
assisted by the Daily Executive Board (DEB).
Presidential Decree 5 (1960)
The Chief Executive was also the chairman
of the local House of Representatives;
The local government secretary was elected
and appointed by the local House of Representatives.
Local Government Act 18 (1965)
Local autonomy was to be executed as
extensively as possible;
The Chief Executive was the leader of
the local House of Representatives;
The local Chief Executive was responsible
to the President through the Minister of home affairs;
Three levels of local government were
established: Province, County or Municipality and District or
Note: This act was never implemented because of a change in national
government in September-October 1965 that changed the policies
of the central government on local government.
Local Government Act 5 (1974)
Local autonomy was to be real and responsible
Local autonomy was focused on the local
government level rather than on the regional government level;
Local autonomy should give priority
to aspects of both harmony and democracy;
Local autonomy was aimed at increasing
efficiency and productivity, especially in the execution of
development process, providing public services and maintaining
political stability as well as national integrity;
Both the decentralization and deconcentration
principle were to be applied.
Local Government Categories
Structure of local government
Local authority organizations consist of five components: the
Chief Executive and his/her deputy (one to three at the provincial
government and one or none at the county and municipal governments),
the House of Representatives, the secretariat, the operational
units and the planning agency.
The Chief Executive of autonomous authorities for both the regional
and local level (Governor, County Commissioner and Mayor) are
elected by the House of Representatives of the respective autonomous
authorities, according to the following procedures:
Political parties in the area suggest
at least three and a maximum of five candidates who are acceptable
to the House of Representatives. The respective House of Representatives
to the Minister of Home Affairs forwards the list of candidates
to the Minister of Home Affairs. If the Minister does not have
any objection to the proposed candidates, the candidates are
put into a vote in the respective House of Representatives.
The result will be a ranking of candidates based on the number
of votes collected by each candidate.
For the position of a governor of a
province, the provincial House of Representatives through the
Minister of Home Affairs submits the names of at least two candidates
to the President. The President decides which one of them is
to be appointed. That is to say, governors are appointed by
the President at the recommendation of the Minister of Home
Affairs from among the candidates proposed by the provincial
House of Representatives. After Presidential Decree appointing
the Governor issued, the new Governor will be sworn in by the
Minister of Home Affairs in front of a special session of the
provincial House of Representatives.
For the position of County Commissioner
or Mayor, almost the same procedures are applied. The only difference
is that the Governor of the respective region, the local House
of Representatives and the Minister of Home Affairs will scrutinize
the candidates proposed by the local House of Representatives.
The Minister decides which one of them is to be appointed. That
is to say, the County Commissioner and Mayor are appointed by
the Minister of Home Affairs at the recommendation of the Governor
from among the candidates proposed by the local House of Representatives.
The respective Governor inaugurates the County Commissioner
The Governor, the County Commissioner
and the Mayor are appointed for a term of five years and are
eligible for immediate re-election and appointment for another
House of Representatives
According to the provision in article 13 of the Local Government
Act (1974), the provincial government consists of the Governor
and the provincial House of Representatives. Similarly, the local
government consists of the County Commissioner (or the Mayor in
the case of an autonomous Municipality) and the local House of
Representatives. The House of Representatives, in concurrence
with the Chief Executive of the respective autonomous entity (Governor,
County Commissioner or Mayor), enacts provincial or local laws,
including those defining provincial and local budgets. Provincial
and local laws are only allowed to regulate matters that are covered
in the responsibilities already transferred to the provincial
and local governments by the central government, the so-called
The secretariat of an autonomous provincial or local government
is part of the provincial or local government organization. Its
main job is to assist the Chief Executive in running the administration
of the provincial or local government and provide administrative
supports for the whole provincial and local government administration.
Its duties cover financial management, budgeting (in concurrence
with the planning agency), personnel management, asset management,
legal affairs and procurement. A provincial secretary heads the
secretariat of a province and a local secretary of a local government.
Similar to the Chief Executive who acts as central government
representative in the region as well, the secretariat of an autonomous
entity also performs the tasks of the secretariat of its respective
administrative entity. Thus the secretariat of a province is also
the secretariat of the region, while the secretariat of a local
government is also the secretariat of the County or the Municipality.
Executive elements of the provincial and local governments performing
mandatory responsibilities of provincial and local governments
that are transferred to them by the central government (i.e. autonomous
responsibilities). Provincial and local laws regulate their duties.
The planning agency is a staff unit of the autonomous entity.
There are a provincial and a local government-planning agency.
The planning agency, however, using the responsibility of the
Governor at the regional level to coordinate regional offices
of ministries, also coordinates the planning activities of the
regional offices of ministries. Thus the regional offices of ministries
send to their respective ministries the development plans which
are already coordinated at the regional level and are approved
by the provincial-planning agency. Similarly, at the local level,
the planning agency coordinates the planning activity of the local
offices of ministries; only sectoral plans which have been approved
by the local planning agency are sent to the regional offices
of the ministries and finally to the ministries at central level.
Local Government Functions
Although to varying degrees, responsibilities that have been
transferred (devolved) by the central government to local governments
nationwide may cover parts of the following areas.
regulation 47 (1951)
Provision of seeds, agricultural tools, demonstration plots agricultural
extension services, etc.
Animal husbandry government
regulation 48 (1951)
Provision of animal markets, slaughterhouses, animal health services
expert training, etc.
Fisheries government regulation
Provision of demonstration projects, prevention and eradication
of fish diseases through provision of medications and extension
services with regards to fishery technology, the development of
fishermen's communities, the management of fish trading in the
Housing government regulation
Allocation of housing for government agencies, para-statal organizations
and non governmental organizations, the allocation of spaces for
the processing of goods, the warehousing of vehicles and the stabling
Education and culture government
regulation 65 (1951)
Provision of elementary school education including the selection
of students, financing, administration, equipment, school buildings
and yards, school employees including teachers, certification
Social development government
regulation 5 (1958)
Provision of homes for homeless children and babies, the placement
of orphans into families, the provision of homes for homeless
adults, disaster relief except national disasters, coordination
of private and non-governmental organizations providing the above
Manpower government regulation
Provisions for workers' welfare and the welfare for the unemployed.
Plantation government regulation
Guidance and monitoring of large plantations in terms of technology
and production, the promotion of investments in plantations, the
control of land used for plantations as well as the development
and guidance on rubber plantations by the people.
Public administration government
regulation 8 (1963)
Assisting central government ministries in delivering basic necessities
to the people.
State projects and enterprises
government regulation 7 (1964)
State enterprises can be transferred to local governments to
become local enterprises.
Forestry government regulation
Provisions for the sale and distribution of forest products and
Small industry government
regulation 23 (1962)
Provisions for the promotion and development of small industries.
Tourism government regulation
Provision and care of tourist sites, tourist guides, guesthouses,
youth hostels, camping grounds, restaurants, bars, tourist areas,
recreations and the promotion of local tourism.
Health government regulation
Provision of welfare to mother and child, family planning, nutrition,
hygiene and sanitation, community health extension, treatment
of casualties, school health, mouth and teeth health, the provision
of medical assistance, medical rehabilitation and care and the
provision of medicines and medical equipment.
Public works government
regulation 18 (1953) and 14 (1987)
Parts of government responsibilities in water resources, in road
and highways and in human settlements including spatial planning.
Transport and traffic government
regulation 22 (1990)
Speed limits, parking, traffic signs, pedestrian crossings, tariffs
for public/local transports, public transport routes, operation
permits for private public transport companies, etc.