Bureaucracy and Development: Reflections from the Indonesian Water Sector 9789814459716

Citation preview

Bureaucracy and

Development

The Institute of Southeast Asian Studies (ISEAS) was established as an autonomous organization in 1968. It is a regional centre dedicated to the study of socio-political, security and economic trends and developments in Southeast Asia and its wider geostrategic and economic environment. The Institute’s research programmes are the Regional Economic Studies (RES, including ASEAN and APEC), Regional Strategic and Political Studies (RSPS), and Regional Social and Cultural Studies (RSCS). ISEAS Publishing, an established academic press, has issued more than 2,000 books and journals. It is the largest scholarly publisher of research about Southeast Asia from within the region. ISEAS Publishing works with many other academic and trade publishers and distributors to disseminate important research and analyses from and about Southeast Asia to the rest of the world.

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Bureaucracy and

Development Reflections from the Indonesian Water Sector

Di a n a S uh a r d i m a n

INSTITUTE OF SOUTHEAST ASIAN STUDIES Singapore

First published in Singapore in 2015 by ISEAS Publishing Institute of Southeast Asian Studies 30 Heng Mui Keng Terrace Pasir Panjang Singapore 119614 E-mail: [email protected] Website: All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the Institute of Southeast Asian Studies. © 2015 Institute of Southeast Asian Studies, Singapore The responsibility for facts and opinions in this publication rests exclusively with the authors and their interpretations do not necessarily reflect the views or the policy of the publishers or their supporters. ISEAS Library Cataloguing-in-Publication Data Suhardiman, Diana, 1973– Bureaucracy and development : reflections from the Indonesian water sector. 1. Irrigation—Government policy—Indonesia. 2. Irrigation—Indonesia—Management. 3. Water—Distribution—Management. I. Title. HD1741 I5S94 2015 ISBN 978-981-4459-70-9 (soft cover) ISBN 978-981-4459-71-6 (e-book, PDF) Typeset by Superskill Graphics Pte Ltd Printed in Singapore by Markono Print Media Pte Ltd

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CONTENTS List of Figures vii List of Tables ix Glossary xi 1. Introduction

1

2.

The Indonesian State in Transition

9

3.

The Irrigation Agency’s Contested Bureaucratic Identity

47

4.

IMT in Indonesia: A Changing Policy Game

78

5.

The Struggle on the Principles of IMT under the WATSAL Programme

121

6.

Regional Governments and IMT Policies

173

7.

IMT and Water Distribution Practices in the Kulon Progo District

205

8. Conclusions

243

References 257 Index 269 About the Author 280

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LIST OF FIGURES 2.1 Government Fund Disbursement Before and After Regional Autonomy 19 2.2 Incorporation of Project Management Unit into the Structure of the Provincial Water Resources Services (PWRS) 21 2.3 Structural and Functional Lines within the Government Organization 31 2.4 Overview of the Provincial Level Project Management Unit under the Indonesia Water Resources and Irrigation Reform Program (IWIRIP) 32 2.5 Formal Procedure in Fund Proposal and Allocation (Before and After the Adoption of the Project Approach 34 3.1 Organizational Chart of the Ministry of Public Works’ Directorate General of Irrigation, 1969–84 52 3.2 Organizational Chart of the Sub-Directorate of Programme Guidance 54 3.3 Overview of the Distribution of Project Benefits at the Ministry of Public Works 60 3.4 Organizational Structure of the Ministry of Public Works, 1984–89 65 3.5 Organizational Structure of the Ministry of Settlement and Regional Development (Kimbangwil), 1999–2001 66 3.6 Organizational Structure of the Ministry of Settlement and Regional Infrastructure or Kimpraswil, 2001–present 69 4.1 Timeline of IMT in Indonesia 88 4.2 WATSAL Organizational Structure 100 4.3 Legal Hierarchy of the IMT Legal Framework under WATSAL 102

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5.1 The Legal Procedure of Water Act Promulgation 128 5.2 Formal Policy Network for the Promulgation of the Water Act in Parliament 129 5.3 The Timeline of the IMT Policy Struggles 134 5.4 Parliamentary Policy network at the Working Committee Level 145 5.5 Parliamentary Policy Network at the First Commission IV Meeting 148 5.6 Parliamentary Policy Network at the Second Commission IV Meeting 156 5.7 Parliamentary Policy Network at the Plenary Meeting 159 6.1 Overview of Provincial Government Structure (before Regional Autonomy) 6.2 Overview of Provincial Government Structure (after Regional Autonomy) 6.3 Districts in Yogyakarta 6.4 The Kulon Progo Irrigation Agency District-Level Structure before Regional Autonomy 6.5 The Kulon Progo Restructured Irrigation Agency after Regional Autonomy 6.6 Irrigation Systems in the Kulon Progo District 7.1 Operational Boundaries of the Seven Technical Irrigation Systems in Kulon Progo 7.2 Hydrological/Technical Inter-System Connection in Irrigation Systems Management 7.3 Overview of the Golongan System in Kulon Progo District 7.4 The Official Division of the Golongan System for Technical Irrigation Systems in Kulon Progo District 7.5 Water Channelling Path from Sermo Reservoir to East Pekik Jamal 7.6 Overview of the Water Distribution between West and East Pengasih 7.7 Overview of FWUA West Pekik Jamal’s Strategy to Channel Water to the Suka Maju Tertiary Unit 7.8 Data Overview with regard to Field Farmers’ Knowledge about WUA/FWUA and IMT

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175 175 180 182 183 187 207 209 212 213 219 222 226 229

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LIST OF TABLES 2.1 Changes by the Regional Autonomy and the Fiscal Decentralization Acts of 1999 2.2 BPK Audit Findings

17 25

3.1 Total Irrigation Development Expenditure by Type of Development, Repelita I–IV

51

4.1 Evolution of IMT Policy in Indonesia 4.2 Comparison of Policy Elements of IMT under the IOMP 1987 Statement and WATSAL of 1999 4.3 WATSAL Agreement 4.4 WATSAL Policy Products 5.1 5.2 5.3 5.4 5.5 5.6

86 87 98 101

Policy Actors’ Perceptions of IMT 123 Revised Clauses of the Draft Water Act 130 WUA Proposed Changes to the Draft Water Act 141 Proposed Changes to Clause 29, Section 3 by Political Parties 155 Proposed Changes to Clause 40, Section 3 by Political Parties 155 GOI’s Position on IMT in 2004 after Kimpraswil’s Withdrawal from WATSAL 162

6.1 Overview of the Irrigation System in the Kulon Progo District 186 7.1 Overview of Technical Irrigation Systems in Kulon Progo District 208 7.2 Overview of the Water Distribution Schedule at the Inter-system Level 211

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7.3 Types of Elite Leadership in the Seven Technical Irrigation Systems in Kulon Progo District

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GLOSSARY APBN the state’s income APBD regional governments’ income ASAL Agricultural Sector Adjustment Loan BPK Supreme Audit Agency BPKP State Audit Agency CO community organizer DAU general purpose grants DAK special purpose grants DDPA District Development Planning Agency DGRD Directorate General of Regional Development DGWRD Directorate General of Water Resources Development DIWR Directorate of Irrigation and Water Resources DPIS Division of Provincial Irrigation Services DWRS District Water Resources Services FWUA Federation of Water Users Association GOI Government of Indonesia IDTO Irrigation Development Turnover IIMI International Irrigation Management Institute IMT Irrigation Management Transfer INFOG Indonesian Forum on Globalization IOMP Irrigation Operation and Maintenance Project ISF irrigation service fee ISSP (I and II) Irrigation Sub-Sector Project IWIRIP Indonesia Water Resources and Irrigation Reform Program JIWMP Java Irrigation Improvement and Water Resources Management Project

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xii JKII KIIF LoSP Meneg PU MoA MoF MoHA MPW NDPA NU O&M PDI PDPA PGTA PIA PIP PROSIDA PWRS SDI SDWR SWUA WATSAL WISMP WTF WUA

Bureaucracy and Development

Irrigation Communication Network of Indonesia Kabupaten Irrigation Improvement Fund Letter of Sector Policy State Ministry of Public Works Ministry of Agriculture Ministry of Finance Ministry of Home Affairs Ministry of Public Works National Development Planning Agency/Bappenas Nahdlatul Ulama operation and maintenance Partai Demokrasi Indonesia Provincial Development Planning Agency On-Farm Water Management Project Provincial Irrigation Agency Provincial Irrigation Project Irrigation Project Funded by the International Development Agency Provincial Water Resources Services Sub-Division of Irrigation Sub-Directorate of Water Resources System-level Water Users Associations Water Sector Adjustment Loan Water Resources and Irrigation Sector Management Project WATSAL Task Force Water Users Associations

NOTE: The irrigation agency was under the: Ministry of Public Works: pre-1988 Ministry of Settlement and Regional Development, also known as Kimbangwil: 1999–2001 Ministry of Settlement and Regional Infrastructure, also known as Kimpraswil: 2001–present

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

1 INTRODUCTION

In the last three decades, international donors have promoted Irrigation Management Transfer (IMT) in many developing countries as a remedy for solving management problems in government-run irrigation systems. The main argument of this book is twofold. First, IMT’s potential to address these problems cannot be achieved if the overseeing irrigation agency does not embrace the need for management transfer. Second, IMT’s success cannot be measured without linking local outcomes to the agency’s willingness to relinquish its power with the transfer and how it formulates and implements IMT policy.1 This book brings to light the close linkage between IMT and the issue of bureaucratic reform. New challenges in water resources management require not only well-formulated reform programmes, but also bureaucracies that value these programmes and are committed to their implementation. Most reform efforts neglect to account for the interests and needs of the bureaucracies that, in essence, are being asked to reform themselves. Taking Indonesia as my main case, I highlight that, if proposed reform is to be meaningful in practice, current authorities must believe in its need; or at least be willing to move forward with the reform. This book analyses the political processes that shape IMT policy formulation and implementation in Indonesia from August 2003 to July 2005, and illustrates how the

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irrigation agency contested the idea of management transfer vis-à-vis its prominent interests and role in the sector’s development. IMT embodies the aspiration of the international epistemic community2 to transfer the management of government irrigation systems to farmer organizations — in Indonesia, the Federation of Water User Associations (FWUAs) and the Water Users Associations (WUAs) — as such transfers are regarded as crucial in addressing the problem of poor system performance.3 International donors and policy-makers viewed the irrigation agency as inefficient in conducting the overall system management4 and conceded that farmer participation might contribute to increased project effectiveness; therefore, they urged the need for management transfer. This idea of farmer participation is derived from successful experiences in farmer-managed irrigation systems (FMIS).5 The inclusion of this idea in the policy agenda of the international donors was based on the common perception that government irrigation systems had grown faster than the institutions that had to regulate them6 and was generated by mounting criticisms concerned about the deterioration of “common property resources” and the impoverishment of the rural community due to government policy interventions.7 IMT became the new international policy trend 8 in irrigation development9 in the early 1990s. It was adopted by the World Bank as one of the cornerstones of its water management policy,10 and it became the reform model promoted worldwide.11 At that time, it was believed that IMT could solve many of the problems in government-managed irrigation systems in developing countries.12 Among the problems to be solved were the following: the high operational costs of government irrigation systems, rapid deterioration of irrigation infrastructure, attitude towards maintenance, inefficient water use, and unequal water distribution. Current discourse on IMT questions the policy’s effectiveness in addressing these problems.13 This book attempts to address this question by bringing to light a pertinent gap in the IMT research: how an irrigation agency’s perceptions and opinions on management transfer is missing from IMT analyses. With a recent focus on good governance, more emphasis has been given to the political aspect of IMT.14 However, with the exception of earlier works by Korten and Siy15 on the National Irrigation Administration in the Philippines, and Rap et al.’s work16 on the reconstitution of the hydraulic bureaucracy in Mexico, the research does not link the political dimension of IMT with the governing agency’s opinion on bureaucratic

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reform. My hypothesis is that unless the interests and concerns of current holders of authority and their control over associated resources are specifically addressed, reform programmes are likely to be compromised by efforts to protect their power. Viewing policy as a process,17 I focus on how the irrigation agency, in all its different iterations,18 perceived the idea of management transfer. As stated by Griffin: Rather than assume that governments attempt to maximize social or national welfare but fail to do so, it might be more suitable to assume that governments have quite different objectives and generally succeed in achieving them. Rather than criticizing governments for failing to attain or offering advice on how to attain a non-goal, it would be instructive if more time were devoted to analyzing what governments actually do and why. (1975, p. 2)19

My line of analysis in this book is derived from the IMT policy renewal that took place in Indonesia in 1999 and the subsequent power struggles over the principles of management transfer. Referring to the politics of policy theoretical perspective,20 I highlight how both the IMT policy and the promulgation process of the new Water Act (from September 2003 to February 2004) were established out of political brokering and contestations.21 The actual management transfer, when there was any, was shaped through negotiations and alliances among the different government ministries, parliamentary representatives, academics, and civil society organizations. This book specifically describes how the irrigation agency perceived and continues to perceive the idea of management transfer as a threat to its overall bureaucratic existence and sectoral importance. It highlights the irrigation agency’s prominent role and ability to reshape or halt the IMT policy process in accordance with its interests in preserving its bureaucratic power. On the basis of these findings, I argue that IMT’s potential to address the many problems in the government irrigation system could have materialized only if the concept of management transfer had been fine-tuned with the irrigation agency’s actual interests. These findings bring to light the controversy in IMT conceptualization and challenge the current assumption in IMT: irrigation agencies cannot be forced to transfer its management responsibilities and control to local governments or farmer organizations.

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Chapter 2 starts with a review of the literature on the “changing” characteristics of the Indonesian state. This chapter untangles the forces that shaped the process of political reform in the country following the fall of Suharto’s New Order government in 1998 and the widespread application of regional autonomy. It describes the origin of the adoption of the project approach in the late 1960s, and how this approach still shapes the present bureaucratic mechanisms of the Indonesian ministries. In the irrigation sector, in particular, the project approach continues to focus on merging project management units into regional government structures, which sustain the rent-seeking practices rooted in project procedures and mechanisms. Chapter 3 analyses the changing bureaucratic identity of the irrigation agency as a consequence of the 1999 organizational restructuring of the Ministry of Public Works (MPW) into the Ministry of Settlement and Regional Development (Kimbangwil). The agency’s approach to reform was directly related to who controlled the agency (which in turn was directly related to who controlled the presidency). Chapter 4 gives a detailed overview of the IMT policy formulation and implementation in Indonesia. The overview begins with a discussion of the formulation of the 1987 Irrigation Operation and Maintenance Project (IOMP) Statement and continues with the extended implementation of IMT under the 1996 Java Irrigation Improvement and Water Resources Management Project–Irrigation Development Turnover and the 1999 reformulation of IMT under the Water Sector Adjustment Loan (WATSAL). A central element in this chapter is the policy analysis of the IMT legal framework under WATSAL as compared to the IOMP 1987 Statement. This chapter clarifies how the ongoing vague formulation of the IMT legal framework is rooted in the fact that international funders and policy-makers neglected to consider the irrigation agency’s decisive role in directing actual policy formulation. Chapter 5 unravels the multiple perceptions, interests, and strategies of the policy actors in relation to battles in 2003 over the IMT policy, when the agency regained its bureaucratic power under now the Ministry of Settlement and Regional Infrastructure (Kimpraswil). It highlights how Kimpraswil policy actors attempted to redirect the policy path back towards recentralization, and how mid-level officials from the Ministry of Home Affairs and the National Development Planning Agency22 challenged this attempt. The new Water Act of 2004 became the central battlefield over this issue. In this chapter, the Water Act and the 2001

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5

Government Regulation on Irrigation is compared, and light is shed on the mechanisms that shape the decision-making process at both the parliamentary and the bureaucratic levels. To bring the Water Act discussion to a close, Chapter 5 maps the evolution of policy network alliances during its promulgation process. Chapter 6 details the role played by provincial and district governments in ignoring Kimpraswil’s demand to halt IMT implementation, highlighting in particular the seven technical irrigation systems located in the Kulon Progo district. It focuses on district governments’ decisions to continue with IMT implementation and the regional governments’ financial strategies to cope with the agency’s stoppage of much-needed IMT funding. It also highlights how the district-level irrigation agency, and FWUAs and WUAs cooperated with each other to ensure the continuation of IMT. Chapter 7 deciphers the actual water distribution practices in the seven technical irrigation systems in Kulon Progo district, and how these practices were linked to the overall process of management transfer. The dominant water distribution patterns and alliances are identified, as are the relationships formed between the farmers, and the FWUAs and WUAs at each hydraulic level of the irrigation systems. These relationships allowed the creation of an intersystem decision-making platform, consisting of system-level WUAs (SWUAs) and the districtlevel irrigation agency. The book concludes with Chapter 8, in which the IMT policy conceptual paradoxes that led to the need for policy reconceptualization are laid out. It makes clear that the IMT policy reformulation cannot be based solely on the wishes of international funders and policy-makers, but must include how the farmers and the irrigation agency view the concept of IMT, and how the agency relates to the shifts in power.

Notes   1. M. Latif and J.A. Tariq, “Performance Assessment of Irrigation Management Transfer from Government-managed to Farmer-managed Irrigation System: A Case Study”, Irrigation and Drainage 58, no. 3 (2009): 275–86; I. Theesfeld, “Irrigation sector in Bulgaria: Impact of post-socialist policy reforms”, Water Policy 10, no. 4 (2008): 375–89; D.L. Vermillion et al., “An Assessment of the Small Scale Irrigation Management Turnover Program in Indonesia”, IWMI Research Report 38 (Colombo: IWMI, 2000).

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  2. Epistemic communities in this context include international policy-makers, donor agencies, and international research institutes. They exert influence on policymaking through diffusion of ideas, acquiring bureaucratic positions, and developing niches in advisory and regulatory bodies (Yee 1996). A. Yee, “The Causal Effects of Ideas on Policies”, International Organization 50, no. 1 (1996): 69–108.   3. L.E. Small and I. Carruthers, Farmer-Financed Irrigation: The Economics of Reform (Cambridge, UK: Cambridge University Press, 1991); M. Svendsen, “The Impact of Financial Autonomy on Irrigation System Performance in the Philippines”, World Development 21, no. 6 (1993): 989–1005.   4. M. Moore, “The Fruits and Fallacies of Neo-Liberalism: The Case of Irrigation Policy”, World Development 11, no. 7 (1989): 1733–50; R. Repetto, “Skimming the Water: Rent-seeking and the Performance of Public Irrigation Systems”, Research Report 4 (Washington, DC: World Resource Institute, 1986).   5. Though see Hunt (1989) on the difficulties in promoting farmer participation under FMIS into WUAs in government irrigation systems. (Robert C. Hunt, “Appropriate Social Organization? Water User Associations in Bureaucratic Canal Irrigation Systems”, Human Organization, no. 48 (November 1989): 79–90; E. Ostrom, Governing the Commons: The Evolution of Institutions for Collective Action (Cambridge: Cambridge University Press, 1990)).  6. David M. Freeman, Local Organizations for Social Development: Concepts and Cases in Local Irrigation Organization (Colorado, CO: Westview Press, 1989).  7. J. Ambler, Irigasi di Indonesia: Dinamika Kelembagaan Petani [Irrigation in Indonesia: Dynamics of Farmer Institutions] (Jakarta: LP3ES, 1991); J.W. Eggink and J. Ubels, Irrigation, Peasants and Development (Wageningen: Wageningen University Press, 1984).   8. Mollinga and Bolding (2003) identify three driving forces behind the emphasis on management transfer: development and learning within the sector; external and international pressure; and domestic fiscal, economic, and political concerns. (Peter P. Mollinga and Alex Bolding, eds., The Politics of Irrigation Reform: Contested Policy Formulation and Implementation in Asia, Africa and Latin America (Ashgate: Global Environmental Governance Series, 2003).)   9. Douglas L. Vermillion, “Irrigation Management Transfer: Towards an Integrated Management Revolution”, address presented at the International Conference on Irrigation Management Transfer in Wuhan, People’s Republic of China, 20–24 September 1994. 10. D. Groenfeldt and M. Svendsen, eds., Case Studies in Participatory Irrigation Management (Washington, DC: World Bank Institute Learning Resource Series, 2000). 11. Scholars in irrigation development have questioned the validity of promoting reform through policy models and argue that policy models in general “do not

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turn out to be so wonderful when practice is studied more closely” (Mollinga and Bolding 2003: 4). Rap (2006) highlights the fact that policy reform cannot be “engineered” externally because cultural context and how policy is shaped by socio-economic and political factors must be taken into account. (Mollinga and Bolding, The Politics of Irrigation Reform); E. Rap, “The Success of A Policy Model: Irrigation Management Transfer in Mexico” (Ph.D. thesis, Wageningen University, 2004). 12. H.M. Malano and P.L.M. Hofwegen, “Management of Irrigation and Drainage Systems: A Service Approach”, IHE Monograph no. 3 (Rotterdam: A.A. Balkema, 1999); H. Turral, Recent Trends in Irrigation Management: Changing Directions for the Public Sector (London: Natural Resource Perspective, ODI Series, 1995). 13. Food and Agriculture Organization, Irrigation Management Transfer: Worldwide Efforts and Results, FAO Water Reports No. 32 (Rome and Colombo: FAO and IWMI, 2007); A. Mukherji et al., Irrigation Reform in Asia: A Review of 198 Cases of IMT, Final report submitted to the ADB (Colombo: IWMI, 2009). 14. Mollinga and Bolding, The Politics of Irrigation Reform; Mick Moore, “Political Underdevelopment: What Causes Bad Governance?” Public Management Review 3 no. 3 (2001): 385–418; Mick Moore, “Revenues, State Formation and the Quality of Governance in Developing Countries”, International Political Science Review 25, no. 3 (2004): 297–319. 15. F. Korten and R.Y. Siy Jr., eds., Transforming a Bureaucracy: The Experience of the Philippine National Irrigation Administration (West Hartford, CT: Kumarian Press, 1989). 16. Rap E., P. Wester, and L.N. Perez-Prado, “The Politics of Creating Commitment: Irrigation Reforms and the Reconstitution of the Hydraulic Bureaucracy in Mexico”, in The Politics of Irrigation Reform: Contested Policy Formulation and Implementation in Asia, Africa and Latin America, edited by Peter P. Mollinga and Alex Bolding (England: Ashgate, 2004), pp. 57–94. 17. E. Clay and B. Schaffer, eds., Room for Manoeuvre: An Exploration of Public Policy in Agriculture and Rural Development (London: Heinemann, 1984). 18. The irrigation agency changed management, and therefore its stress on reform, three times since 1998. The irrigation agency was incorporated in the MPW prior to 1998 and later it became part of the Ministry of Settlement and Regional Development, also known as Kimbangwil, 1999–2001, and for the third time, into the Ministry of Settlement and Regional Infrastructure, also known as Kimpraswil, 2001–present. 19. K. Griffin, Political Economy of Agrarian Change (London: Macmillan, 1975). 20. M.S. Grindle, “After the Decision: Implementing Policy Reforms in Developing Countries”, World Development 18, no. 8 (1990): 1163–81.

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21. S. Hilgartner and C.L. Bosk, “The Rise and Fall of Social Problems: A Public Arenas Model”, American Journal of Sociology 94, no. 1 (1988): 53–78; A.D. Rochefort and W.R. Cobb, “Problem Definition, Agenda Access and Policy Choice”, Policy Studies Journal 21, no. 1 (1993): 56–71. 22. The minister of Kimbangwil attempted unsuccessfully to turn power over to the WUAs and FWUAs; the minister of Kimpraswil has no such intentions.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

2 THE INDONESIAN STATE IN TRANSITION

INTRODUCTION The Indonesian state continues to function as a rentier state,1 even after the fall of Suharto’s New Order government in 1998. A rentier state2 is defined as one in which rents are paid by foreign actors directly to the state and its leaders, and where society is only involved in the utilization of the profits.3 The characteristic of Indonesia as a rentier state is evident from both the massive use of the project approach (which originated in the late 1960s) in Indonesia’s sectoral development and the government’s dependency on foreign loans. The political reform following the fall of Suharto’s dictatorship did not eliminate rent-seeking practices. Instead, these practices remain rooted in the political relationship between the president in power and the country’s ministers, and continue to govern the process of state (re)formation. This dependency on foreign funding remains apparent in the present Indonesian government. This chapter discusses the characteristics of the Indonesian state as a rentier state (Section I) and illuminates the current political relationship between the president and the ministers (Section II). It also analyses how the concept of regional autonomy failed to change the central

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government–regional government relationship: at the national level, the central government has resisted the application of regional autonomy and at the regional level, regional autonomy has been hampered by widespread corruption practices inside and outside the government (Section III). The chapter then explains the formal changes incorporated in the emergence of regional autonomy and its effect on the organizational restructuring of the irrigation agency at the regional level in 2001 (Section IV). This chapter also details Indonesia’s sectoral development, shaped by that project approach of the late 1960s, and how the adaptation of government organizational structures and financial regulations since the 1960s have had a profound and lasting effect on the development of the state irrigation agency (Section V).

SECTION I: INDONESIA AS A RENTIER STATE The present discourse on the characteristics of the Indonesian state after the fall of the New Order government is shaped by two dominant propositions. Following the political reform of 1998, some of Indonesia’s political observers consider that the state has entered a transitional phase — from authoritarian rule to a new democratic system of government — in which civil society will play a more prominent role.4 Others who are less optimistic think that the Indonesian state is transforming from a bureaucratic interventionist developmental state into a messy (in which I also mean criminal and crony) state.5 The word messy implies increased high-level and petty criminality, the spread of political violence and corruption, and short-term opportunism.6 In this book, I use the rentier state concept to highlight the unchanged characteristics of the Indonesian state.7 According to Dr Susetiawan from Gadjah Mada University, the political reform in 1998 was stalled during the state of political euphoria. Reacting to the fall of the New Order government, political actors from the reformist front (groups of activists from civil society movements, independent university experts, moderate government officials, and unco-opted religious leaders) were constantly engaged in endless sociopolitical discussion. Little or no attention was given to the formulation of real strategies to counteract the existing bureaucratic mechanisms inherited from the New Order. Hence, in my opinion, the fall of the New Order government did not necessarily mean that the Indonesian state transformed from an authoritarian state towards either

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a democratic state or a messy criminal and crony state (see Kaviraj)8 on what happened, or rather did not happen, to the British Raj bureaucracy after Indian independence). Rather, I emphasize the still-dominant presence of New Order mechanisms in shaping the overall application of regional autonomy and how efforts to reform the government are hampered by the institutionalization of these mechanisms both inside and outside the government structure (see, for instance, Batley, Cohen, and Peters9 on the tenacity of bureaucratic procedure and culture). Before and after the political reform of 1998, foreign loans remained the central government’s basic resource to direct the country’s development. Under Suharto’s government, while loans were used to finance the country’s sectoral development (to reach self-sufficiency in rice production), they were also one of the New Order’s financial resources to generate legitimacy for the regime’s political power.10 In the post-New Order era, the state–citizen relationship continues to be shaped by the government’s decision-making authority in the disbursement of development funds. By relying on funding support from foreign donors, the government can direct the country’s development independently from the people’s popular demands. Put differently, the Government of Indonesia lacks the incentive and motivation to improve its bureaucratic responsibility to respond to local development needs because it does not have to raise revenues within the national economy as long as donors are willing to continue their funding support.11 This lack of incentive and motivation is often referred to as the moral hazard effect12 of loan dependence.13 In Indonesia, foreign loans sustain bureaucratic patrimonialism and allow the continuation of corrupt practices within the government bureaucracy in the post-New Order era (see Eisenstadt14 on how this patrimonialism resulted in the formation of an “empire” state). Directed primarily by the government’s ability to distribute its resources (usually in a trickle-down manner) to the local population, the state–citizen relationship remains characterized by patron–client networks,15 just as it was before Suharto’s fall.16 Despite the abolition of the New Order government, its rules and main mechanisms continue to govern the present government bureaucracy.17 Composition of the bureaucratic elites changed — from military to civilian or from actors with a strong government background to those with a non-governmental background — yet the same bureaucratic mechanisms are applied. For example, even in present-day Indonesia, strong political connections remain indispensable to one’s access to government contracts as well as

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to one’s ability to obtain preferential regulatory treatment, such as early or decisive information on certain tendering procedures.18 In the irrigation sector, the characteristic of Indonesia as a rentier state is also evidenced from the way the central government remains in charge of directing regional development through its foreign-funded projects. Irrigation sector development continues to be directed through projects, despite the overall application of regional autonomy starting in 2001. The Irrigation Management Transfer (IMT) programme under the Water Sector Adjustment Loan (WATSAL) was implemented by the irrigation agency under the Ministry of Settlement and Regional Development (also known as Kimbangwil) from 1999 to 2001, and then under the Ministry of Settlement and Regional Infrastructure (also known as Kimpraswil)19 from 2001 onwards under the auspices of World Bank–funded projects.20 In 2004, the IMT programme continued to be funded by the World Bank through its Water Resources and Irrigation Sector Management Project (WISMP). Irrigation sector development continues to be directed by project fund disbursement from the central ministry, regardless of any regional government’s actual development needs, and the regional governments accept whatever projects are given to them. As was previously the case, project funds continue to be managed exclusively by the project leader and the supervisor at the central ministries. Project activities are defined and evaluated by following rigid, step-by-step project planning or the socalled development blueprint.21 Even when project activities are not in line with the local population’s development needs, the central government insists that project activities be conducted according to predefined plans, primarily to ensure the appearance of consistency between budget proposal and budget allocation, no matter how the money is actually spent.

SECTION II: THE PRESIDENT’S INNER CIRCLE OF POWER AND THE INDONESIAN STATE (RE)FORMATION Despite the fall of Suharto’s government in 1998, the characteristic of Indonesia as a rentier state remains unchanged because the basic structure of power, which is centred on the president’s inner circle of power (the head of state enterprises, the regional governors, and, most importantly, the ministers), remains the same.22 In 1999, President Abdurrahman Wahid’s government attempted to reactivate the role of parliament in directing

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the country’s development by shifting the decision-making authority for development fund allocation from the National Development Planning Agency (NDPA) to parliament. In practice, this shift not only failed to eliminate corruption practices within the government ministries but also failed to reshape the relationship between the president and the cabinet ministers from a political to a bureaucratic one. The (re)formation process of the post-Suharto Indonesian state continues to be governed by corrupt practices because the political relationship between the president and the ministers remains shaped by the political party partisanship system.23 Kothari and Roy24 described this relationship between politicians and bureaucrats as a power nexus.25 According to Transparency International,26 Indonesia was ranked number 80 out of the 85 countries on its Corruption Perceptions Index. Indonesia was also ignobly ranked as the most corrupt country in Asia by the Political and Economic Risk Consultancy, Ltd.27 Under the political party partisanship system (as established by Suharto), ministerial positions function primarily as the president’s political resource, that is, to sustain and reproduce presidential political power. This function is linked primarily with the ministers’ illegal access to development funds or foreign loans, which can be channelled to finance the president’s political campaigns during national elections. As a general rule, a minister’s access to sectoral development funds is the president’s crucial weapon in directing the overall outcome of the election, as elections are primarily steered by the practice of money politics, both legally and illegally.28 This political party partisanship system is also described to a certain extent in Wade’s29 study on the market for public office in India, in which he correlates higher-ranking officials’ and politicians’ strategies to sustain corrupt practices at the ministries to their interest in using the illegally acquired funds for electoral support. In this book, I combine Bayley’s public-office-centred and van Klaveren’s market-centred30 definitions of corruption. Corruption is defined as “the misuse of authority as a result of considerations of personal gain, which need not be monetary”. In this context, public office is viewed as a business and is reduced to the so-called maximizing unit, in which a corrupt civil servant can maximize personal income.31 In the Indonesian context, this definition includes the three elements of corruption, as widely described in the acronym KKN (korupsi, kollusi, nepotisme, translated as corruption, collusion, nepotism).32

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Within the political party partisanship system, both the president and the ministers have a direct interest in sustaining the corruption within the ministries. Put differently, ministers have no reason to fear that the president will report corruption within their respective ministry to the parliament or to the Supreme Audit Agency (BPK), knowing that the president receives direct benefits from the corruption. Similarly, the president has no reason to eliminate rent-seeking practices within the ministries because the president relies on the delivery of a certain amount of rents from the ministers to sustain political power. As argued by McLeod: Under Suharto, corruption was not an unintended consequence of a highly interventionist state. Rather, a system of government intervention was consciously put in place for the purpose of generating the rents that Suharto presumably wanted for their own sake, but also needed in order to first attain and then maintain a position of virtually unchallenged authority. (2004, p. 6)33

Consequently, the way sectoral development funds are managed by both the president and the ministers necessitates the continuation of development fund disbursement from foreign loans because these loans have become their source of political power. Suharto used his close relationship with his ministers to channel sectoral development funds to feed GOLKAR (the ruling political party during the New Order government), which primarily functioned as the political machinery in sustaining political power from one election to another. This regular, but illegal, fund channelling was possible because both the State Audit Agency (BPKP) and the BPK lacked the authority to counteract the president’s power,34 and thus corruption became rooted in the relationship between the president and the ministers. After the fall of the Suharto’s New Order government, the new ruling political party used sectoral development funds to finance its own extensive political campaigns. In 2004, these same funds were disbursed directly from the ministerial level to each presidential candidate, following the introduction of direct presidential elections.35 At the grass-roots level, these political campaigns included the realization of different types of development activities (such as rebuilding road infrastructure and schools or delivering harvest machinery and pumps to farmers). In addition, political parties distributed cash to local residents during their campaigns.

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Within the political party partisanship system, the president selects the ministerial staff based on party loyalty rather than work performance. The president gives political allies strategic positions in the cabinet, while at the same time replacing those who belonged to the political opposition group. For instance, under Suharto, key bureaucratic positions often went to the military officers loyal to him. In the 1990s, the domination of Suharto’s inner circle of power in government top positions was so obvious that other government officials cynically referred to them as graduates of Cendana University.36, 37 In addition, Suharto gave his most loyal ministers huge development budgets. To paraphrase various officials I interviewed in 2003 and 2004 from the NDPA, from the Ministry of Agriculture (MoA), and from Ministry of Home Affairs (MoHA) during the country’s national election, the Ministry of Public Works (MPW) became one of the ministries informally referred to as the president’s “milk cows”.38 In the irrigation sector, the political relationship between the president and the ministers, post Suharto, remains evident because both President Abdurrahman Wahid and President Megawati Soekarnoputri appointed members of their political alliance,39 respectively, as the head of Kimbangwil in 1999 and as the head of Kimpraswil in 2001. Similarly, at the ministerial level, each minister assigns staff based on political partisanship. This nested political partisanship is important, especially if the minister has to cover up any financial misconduct in supporting the president’s political campaign. In this context, the minister’s power is defined by the ability to build personal and political alliances within the formal organizational structure of the ministry. For example, when the MPW was abolished and replaced by Kimbangwil in 1999, the new minister introduced into the Kimbangwil organizational structure new policy actors belonging to her alliance. Similarly, when Kimbangwil and the State Ministry of Public Works (also known as Meneg PU) were combined into Kimpraswil in 2001, the new Kimpraswil minister replaced all the ministerial staff with officials belonging to his alliance. In 2004, when a new minister of Kimpraswil was appointed (after the presidency had changed again), higher officials were reshuffled, including replacing the Director General of Water Resources Development (whom the new minister viewed as a loyal follower of the former minister) with a person who had been in conflict with the former minister. In summary, both the preserved political relationship between the president and the ministers and the continuation of fund disbursement from

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foreign loans allowed for the transfer of Suharto’s New Order government’s bureaucratic mechanisms into the present-day government ministries.

SECTION III: REGIONAL AUTONOMY AND THE FALL OF THE NEW ORDER GOVERNMENT After the fall of Suharto in 1998, the Indonesian state was “reformed”. The people’s distrust of the central government and their demand to abolish the New Order government gave birth to the concept of regional autonomy. Only five months after the downfall propelled by mounting political pressure from student movements, the concept of regional autonomy was legally promoted in the decree of People General Assembly. Through this decree, the power concentration at the central government was dissolved in support of regional self-government. Less than a year later, the decree was succeeded by the Regional Autonomy Act Number 22 of 1999. With this act, the country’s political reform was again directed towards decentralization40 of government structure and decision-making authority. Here, a distinction should be made between decentralization, which involves the transfer of decision-making authority from the central government to the regional governments, and deconcentration, which involves only the transfer of government functions to the lower administrative level.41 Below, I summarize the formal changes incorporated within this regional autonomy, and then I discuss the irrigation agency’s organizational restructuring at the regional level, as a consequence of regional autonomy.

Regional Autonomy: A Concept Theoretically, regional autonomy should have empowered the regional governments and reduced the power of the central government at the regional level. As mentioned above, authority to direct regional development transferred from the central government to the regional governments with the Regional Autonomy Act. Also in 1999, the Fiscal Decentralization Act Number 25 of 1999 was enacted to accompany the Regional Autonomy Act. With the creation of these acts, regional governments were not only authorized to formulate and define their own regional development plans but also put in charge of managing their own development funds. An overview of the formal changes brought by regional autonomy is presented in Table 2.1.

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TABLE 2.1 Changes by the Regional Autonomy and the Fiscal Decentralization Acts of 1999* Issues

Before regional autonomy

After regional autonomy

Decision-making authority in regional development

Provincial, district, subdistrict, and village governments act as central government’s representatives

District governments have autonomy over district development

Relationship between executive (government) and legislative (parliament) organs at the regional level

Legislative organ’s role in Regional development dominated by executive organs regional development is reactivated (direct representatives of the central government)

Revenue collection

Central government receives 90 per cent of tax revenue; regional governments 10 per cent

District governments receive 90 per cent from total tax collection; central government 10 per cent

Development fund disbursement

Centralized fund disbursement by MoHA (administrative expenditures) and sectoral ministries (sectoral development activities) to provincial down to village governments

Fund disbursement through DAU and DAK grant systems: expenditures for administrative and sectoral development activities

Personnel and administrative

Central ministries represented by regional offices (within sectoral ministries) located at the provincial level

Regional offices abolished

Notes: *Regional Autonomy Act Number 22 of 1999 and Fiscal Decentralization Act Number 25 of 1999. DAU = general purpose grants, DAK= special purpose grants.

District governments now had complete autonomy and were fully authorized to direct their development with regional autonomy.42 First, with this autonomy, the central government was not allowed to interfere in district matters, except for monetary, foreign relations, judiciary, defence, religious, or other national issues.43 Unlike district governments, provincial governments remained the central government’s formal representative at the regional level, though the provincial government’s role shifted towards inter-district development facilitator and coordinator. Prior

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to the Regional Autonomy Act, discussion on regional autonomy was focused on whether to transfer the authority to the provincial or district governments. According to interviews with MoHA officials in 2003 and 2004, authority to transfer power to the provincial governments was first proposed because government officials at the national level thought that provincial governments were better able to direct regional development than their counterparts at the district level. However, in the end, the central government transferred its decision-making authority directly to the district governments44 because it feared that the provincial governments’ power would replace the central government’s important role in directing the country’s overall development.45 The central government also feared that transferring decision-making authority to the provinces would eventually strengthen secessionist movements, whereas individual district governments’ territory and scope of power were considered to be too small to be able to secede.46 This decision reflects the fragmented opinions and positions of the central government bureaucracy towards regional autonomy, which later had serious implications on the overall application of regional autonomy.47 Second, local parliaments’ decision-making role in regional development was reactivated. Previously, local parliament members were no more than the central government’s political representatives,48 playing hardly any role in regional development. In the new era, local parliament members are in charge of defining the regional development plan and budget, together with the executive organ (the provincial government under the governors). They are also in charge of monitoring the regional government’s performance and electing49 both district heads and governors. Third, the district governments became authorized to define their revenue needs, taking a total of 90 per cent from the total tax collection (see Figure 2.1). Prior to regional autonomy, district governments received only 10 per cent of the total tax revenue, with the central government keeping the rest. Furthermore, after regional autonomy, district governments became entitled to add new forms of local taxes to increase their revenues. Fourth, general purpose grants (DAUs) and special purpose grants (DAKs) were introduced with regional autonomy. With these grants, the central government remains the financial contributor to regional development, but its influence in directing the set-up of regional development is reduced. Theoretically, both DAUs and DAKs enable regional governments to conduct sectoral development, independent from the central ministries’ interference, because they are authorized to

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FIGURE 2.1 Government Fund Disbursement Before and After Regional Autonomy

BEFORE REGIONAL AUTONOMY: Fiscal tax

Regional Government

10%

90%

X%

X%

Province

District

X% Other revenues

Central Government

X%

X%

Gov. Subsidies & Aid Funds

AFTER REGIONAL AUTONOMY: Fiscal tax

10%

Regional Government

90%

X%

X%

Province

District

10% Other revenues

Central Government

25%

90% DAU

X%

DAK

manage both funds50 according to their needs. The DAU forms 25 per cent of the total state revenue and is supposed to be disbursed directly from the MoHA to regional governments. Ten per cent of the disbursed fund is reserved for the provincial government, while 90 per cent is transferred

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to the district governments.51 The DAK, on the other hand, comes from sectoral funds from each ministry, and is supposed to be disbursed by the sectoral ministries to the district governments, regardless of sectoral earmarking. Fifth, the central ministries’ offices at the regional level were abolished with regional autonomy. Staffs were transferred either to the central ministries or incorporated within the provincial or district governments.

Regional Autonomy and the Irrigation Agency’s Organizational Structure In the irrigation sector, regional autonomy resulted in the abolition of the MPW’s regional offices and MPW project management units were disbanded, though they were then incorporated into the regional government structure (see Figure 2.2). At the regional level, MPW’s irrigation projects were incorporated into the Provincial Irrigation Agency (PIA), a second-tier unit under the Provincial Water Resources Services (PWRS). After autonomy, the project leaders should have functioned under the direct supervision of the PWRS. For irrigation projects in particular, project leaders were appointed by the PIA. Theoretically, this new decision-making line should have enabled each PIA to manage the project leaders’ conduct towards the regional government’s development needs and allow each PIA leader to choose the candidate52 who best represented each regional government’s interest. Prior to regional autonomy, project leaders were appointed by supervisors at the central ministry and were not responsible for reporting to either the PIA or the PWRS; hence, they did not have to take into account their PIA or the PWRS leaders’ perceptions and opinions with regard to planned and current project activities. Following the incorporation of the project management units into the PWRS, fund allocation from the sectoral ministry was disbursed to the head of the PWRS through the governors in the first trimester of each fiscal year. Starting in 2001, this fund was disbursed by the head of the PWRS to each unit within the organization. Again, theoretically, this change in the financial disbursement line increased the regional governments’ (the PWRS and PIA, in particular) decision-making authority in directing the overall regional development activities. Prior to regional autonomy, the project fund was distributed directly through the project structure, involving

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Provincial level

Irrigation Section

Irrigation Section

River Unit

Irrigation Section

DWRS Head

Irrigation Section

PIA Head

PWRS Head

Irrigation Section

Irrigation Section

Planning Unit SubProject

DPIS Staff

DPIS Head

SubProject

Project Head SubProject

FIGURE 2.2 Incorporation of Project Management Unit into the Structure of the Provincial Water Resources Services (PWRS)

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District level

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primarily the project leader and his/her supervisor at the central ministry in Jakarta. After regional autonomy, the PWRS and PIA were in charge of managing the sectoral development fund from project funds. However, as I explain below, the plans for altering disbursement of funds through the PWRS and PIA were never fully realized.

SECTION IV: THE APPLICATION OF REGIONAL AUTONOMY In practice, regional autonomy was widely applied only in early 2001. In this section, I clarify how the central government’s interest in preserving its importance in regional development handicapped the overall application of regional autonomy, and then I illustrate how regional autonomy has been hampered by systemic rent-seeking practices. In addition, I discuss the prospect of regional autonomy reshaping the central government–regional government relationship.

Regional Autonomy and the Preservation of Fiscal Dependency Regional autonomy has been resisted by the central government, which continues to hold its grip on the main sources of the regions’ revenue. As of 2007, the central government still controlled 80 per cent of income taxes, value-added taxes, import duties, export taxes, and foreign aid disbursement.53 Regional governments have been allowed to levy only a modest number of local taxes, such as on motor fuel and vehicles.54 Apart from the central government’s resistance, the application of the DAU was hampered by the political lobbying conducted by resourcerich regions towards both the Ministry of Finance (MoF) and the MoHA (Suparno; see also Bahl and Tumennasan on how revenue from natural resources should be shared).55 This lobbying advantaged the resource-rich regions at the expense of other regions.56 The central government was supposed to distribute 25 per cent of the total state revenue to the regions and keep 75 per cent at the national level. In this way, the DAU was meant primarily as an additional budget to fill the fiscal gap57 in regional revenue. In practice, the calculation of the DAU in 2001 did not take into account variations in local shares of revenues. In addition, resource-rich regions forced the central government to adopt a new clause in the calculation

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of the DAU, thereby ensuring that they receive the same amount of the DAU as in previous years, despite their increasing share of revenues.58 Hence, resource-rich regions sustained their high share of DAU despite their financial ability to support their own regional development. Conversely, other regions remain dependent on the central government for their regional development because the disbursed amount of the DAU was not sufficient to cover both routine expenditures and regional development activities.59 Regional governments could not rely on the additional DAU budget to cover costs if their access to tax revenue was limited only to local taxes.60 As stated in the report made by the Asia Foundation,61 local taxes formed only 7 per cent of the regional income in 2002. Put another way, despite regional autonomy, regional development remained subsidized by the central government. The regional governments’ inability to direct their own sectoral development was also related to the fact that the DAK system, which is formulated to compensate regional governments’ financial ability to conduct sector-specific development, was not applied until 2005; this means that sectoral development continued to be handled by the central ministries through their project funds. In addition, regional governments often had to pay central government staff salaries, which by 2007 were formally incorporated into district governments’ expenditures.62 After the transfer of the personnel and physical assets of the nine decentralized ministries, regional civil servants accounted for 66.7 per cent of the total of 3.9 million civil servants in 2001, compared to 12.2 per cent in 1999.63 Regional autonomy gave district governments the formal legal basis to formulate their regional development programmes but not the necessary resources to implement the defined programmes: The changes in grant allocation among regions have been less revolutionary than the 1999 decentralization legislation envisaged. There has not been much increase in autonomy for the regions that have few natural resources because no major tax was decentralized. (Fane 2003, p. 159)64

The central government’s resistance also delayed any formulation of legal regulations to support or direct the actual implementation of regional autonomy. Formally, more than 1,000 government regulations, presidential decrees, and presidential instructions were to be revoked following regional autonomy.65 In practice, regional autonomy had no

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proper guidelines. In Rasyid’s66 words: “A negative campaign on regional autonomy was launched, even before the concept was applied in 2001” (Rasyid 2005, p. 15).67 Issues such as national disintegration and the danger of regionalism were often presented as arguments to halt the application of regional autonomy.68 In 2003, the central government’s resistance became evident in MoHA’s efforts to revise both the Regional Autonomy Act and Fiscal Decentralization Act.69 The revisions were based on the MoHA’s perception that the regional governments were not ready to carry out their own development.70 According to MoHA officials, regional governments lacked the vision to direct regional development because they were accustomed to follow central government instructions. As expressed by one MoHA official in 2004: For instance, during a training exercise on how to make a development fund proposal, regional government representatives were unable to define and plan their development proposal. Instead, they kept asking for possible reference with regard to the central government development projects.

Interesting to note here is that the central government accused the district government alliances of being politically subversive, when they demanded direct involvement in revising the acts. The central government even recommended that the alliances wait to respond to revisions to the acts until they were finalized by the MoHA and channelled to parliament.71 In the irrigation sector, the integration of the project management unit into the PIA did not happen because the change in the line of command was not accompanied by a change in the financial disbursement protocol. Following non-application of the DAK, project funds continued to be disbursed from the sectoral ministry (at the national level) directly to the project leader (at the district level). As a reminder, the project leader was supposedly under the supervision of the PIA in the PWRS. In reality, the project fund continued to be managed exclusively by the project leader and the supervisor at the ministerial level. Even in the regional autonomy era, the project leader remained more influential in directing regional development through project activities than either the PIA leader or even the PWRS leader. As stated by a PIA official in Yogyakarta province in 2004: “After regional autonomy, project activities continued to be conducted like before. The project leader remained the main actor in directing regional development.”

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Regional Autonomy and Bureaucratic Rent-Seeking Regional autonomy was hampered by corruption practices, once concentrated at the national level and now widely applied at the regional level. The percentage deviations of both routine expenditures (such as government staff salaries or administrative costs) and development funds at central, provincial, and district levels are presented in Table 2.2. Corruption practices are concentrated in the relationship between regional government officials and local parliament members.72 Local parliament members use their budgetary powers to force the district governments to provide them with various benefits (e.g. luxury cars, visits to foreign countries for “comparative” study on certain issues, increased social benefits) in return for district government development proposals.73 In turn, regional governments prepare budget proposals for development with substantial mark-ups (from 50 to 100 per cent), confident that local parliament members will approve such proposals because they share the financial “benefits” from the management of the regional revenue.74 Matsui75 writes that with decentralization in Indonesia, the salaries of members of local parliament account for more than half of the regional governments’ revenue. Further, Emilia76 shows that in 2001, the local parliament in West Sumatra received an additional Rp11 billion from the regional government. Later, in the same year, this money was distributed in the form of financial support to the members of privately owned nongovernmental organizations (NGO). TABLE 2.2 BPK Audit Findings Type of funds National level Routine funds Development funds Provincial level Routine funds Development funds District level Routine funds Development funds

Percentage deviations in 2001

Percentage deviations in 2002

13.6 20.5 6.4 3.7 1.8 5.1 12.7 13.8 11.6

16.1 9.8 15.6 27.9 8.1 30.7 21.8 21.6 22.0

Notes: BPK=Supreme Audit Agency Source: World Bank, 2003b.

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In the irrigation sector, corruption practices continued to be applied around project procedures and regulations; regional autonomy did not change how sectoral development is conducted. As mentioned above, the project fund continues to be managed by the project leaders and supervisors at the central government. Perhaps the only difference with regional autonomy is that the project leader can hold PIA and ministerial level supervisors accountable for any financial misconduct, including being charged with corruption.

The Prospect of Regional Autonomy Regardless of the lack of true reform, regional autonomy did reshape the relationship between the central and regional governments. As expressed in an interview with an official from the PIA in Yogyakarta in 2004: Regional autonomy should be viewed as increased opportunities for regional government, instead of absolute decision-making power. Prior to regional autonomy, [the] central government decided everything. With regional autonomy, regional governments could propose their development program to the central government. Though, of course, the central government was the one [that] had to approve this proposal.

The changing relationship between central and regional governments lay in the regional governments’ ability to first link their proposed development programme with central government projects, and then to reshape the approved programmes in such a way that they coincide with regional development needs. Theoretically, with regional autonomy, central ministries based their budget allocations on the regional governments’ development proposals. Practically, the approved proposals were those that had strong connections with development projects formulated by the central ministries. Hence, before a regional government proposed its development programme to the central ministries, it would first screen the existing projects of each particular ministry and then link its proposed programme to the existing activity titles defined by these central ministries. In the Indonesia Water Resources and Irrigation Reform Program (IWIRIP), for example, a regional government would have to propose fund allocation for inter-FWUA (Federation of Water User Associations) meetings or for FWUA forum coordination under the activity title77 “Consultation and Project Coordination”.78

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Once the fund for the proposed development was allocated, it could be distributed according to development priorities defined by the PIA, independent of the central ministries’ development preferences. As stated by a PIA official in East Java in 2004: “In more extreme cases, the PIA could even use part of a development fund which was meant for construction to cover funds for FWUA training and other farmer empowerment activities”. In 2004, there were ongoing discussions on these handicaps on regional autonomy and on returning the procedure in development fund disbursement to the “authorization letter” system, which was the system in place prior to the adoption of the project approach in the late 1960s. According to this system, development fund allocation could only be negotiated between the sectoral ministries and the MoF, not between the sectoral ministries and the potential donors. In 2004, the reformulation of the authorization letter system focused on the inclusion of foreign loans as development funds to be disbursed by the MoF. On the assumption that the MoF would accept only economically feasible loans, government policy-makers thought that overspending could be avoided. Furthermore, the sectoral ministries would now be held responsible for loan repayment and regional governments could also be included in the loan repayment agreement if the allocated loans were disbursed to the regional governments. Government policy-makers thought that both central and regional governments would be more careful in receiving, respectively, foreign loans and central government projects because they carried the responsibility of repaying these loans. This ongoing discussion did not lead to government reformulation on development fund channelling until 2011.

SECTION V: THE PROJECT APPROACH AND INDONESIA’S SECTORAL DEVELOPMENT The way the project approach (which was first presented by Professor Widjojo Nitisastro on national television in the late 1960s)79 has been applied in Indonesia (both prior to and after regional autonomy) has allowed the continuation of corruption within the government bureaucracy.80 Yet, even in 2004, after regional autonomy the advantages of the project approach were the reason given for the continuation of the approach. As expressed by an official from Kimpraswil in an interview in 2004:

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The project staff could handle a larger amount of development activities in a relatively shorter time because they work more effectively through its integrated management unit. Besides, a project head could easily direct, monitor, and register the actual implementation of project activities, as well as the actual budget spent on these activities, towards the realization of predefined project targets through the step-by-step project procedure.

This was the given logic, despite the fact that the project approach failed to solve managerial problems (see Hulme on general criticisms on the project approach and Rondinelli on how alternative structures that translate policies into policy programmes are still lacking81). Next, I explain the adoption of the project approach in the late 1960s and describe the formation of the project structure at the national and district levels, paralleling the organizational structure of the government ministries. I discuss how the changes in development fund management, and the way project activities were directed, monitored, and evaluated through step-by-step project procedures, resulted in retaining systemic rent-seeking practices within the government ministries.

The Origin of the Project Development Approach The World Bank introduced the project development approach to the NDPA in the late 1960s.82 In the irrigation sector, the project approach was first applied in 1969 through Projek Irigasi Daerah or PROSIDA (irrigation project funded by the International Development Agency),83 which lasted until 1984. Construction and rehabilitation projects were the main activities. From 1985 through 1996, irrigation sector development was directed through another World Bank–funded project, the Irrigation Sub-Sector Project (ISSP I and II);84 in 1997, it became the Java Irrigation Improvement and Water Resources Management Project (JIWMP). Unlike under PROSIDA, project activities in the ISSP and JIWMP were focused on system operation and maintenance (O&M), though construction and rehabilitation programmes remained in both projects. In 2000, following the formulation of IMT under the WATSAL, the JIWMP was extended into the Indonesian Water Resources and Irrigation Reform Program (IWIRIP). In 2005, WISMP started as a follow-up to IMT implementation under the IWIRIP. The World Bank funded all JIWMP, IWIRIP, and WISMP programmes. The adoption of the project approach85 was propelled by the New Order government’s attempt to address the country’s lack of financial resources to

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direct its sectoral development. After hyperinflation destroyed Soekarno’s government in the 1960s, Suharto’s New Order government focused on recovering the country’s political stability through massive economic development (Booth; Rachbini; see Anderson for a detailed explanation of the political reasons behind the adoption).86 In the irrigation sector, in particular, with the adoption of the project approach, foreign loans became the financial source for sectoral development and project activities became the country’s development engine. Further, the project approach was adopted to eradicate corruption practices within the government ministries. Prior to its introduction, development fund expenditure were barely monitored by the respective ministries. With its adoption, government officials in the NDPA believed that budgets could be controlled and monitored more easily through the rigid, step-by-step procedures in project fund management.87 Every budget item for each development activity was to be registered separately, under the project activities list. For instance, in the IWIRIP, the development budget for training activities was differentiated into types of training: financial audit, water management, O&M, and organizational management. The budget spent on each activity was to be monitored by the project leader in relation to actual progress in the field. Furthermore, the central government could link project activities from the national level down to district level through an integrated project management unit. The development plans, as defined by the central ministries, were to be implemented and monitored by the regional project leader through this unit. In addition, development activities were focused towards meeting the predefined development goals and objectives, and project activities were organized and implemented towards meeting the predefined project targets.

The Project Development Approach and Government’s Organizational Structure The adoption of the project approach was followed by the formation of a project structure, the above-mentioned project management unit, at both the national and regional levels. The way project management units were linked to the central government’s organizational structure resulted in distinct structural and functional lines within the ministries. Structural staff referred to employees stationed within the ministries; functional staff, also called project staff, was assigned to conduct project activities. Structural employees were not formally involved in project activities, and

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project employees, conversely, were not formally involved in the overall decision-making process within the ministries. The project management units symbolized the central government’s presence at the regional level. In general, a project management unit consisted of planning, implementation, finance, general assistance, and treasury sections. In some cases, a project leader also appointed subproject leaders, responsible for programme implementation; each subproject unit was equipped with its own financial and monitoring sections. As mentioned above, project leaders were only responsible to his or her supervisor at the national level; consequently, MPW project staff was not linked at the provisional level to the PIA. Similarly, at the district level, project leaders were not linked to the District Water Resources Services. A DPIS head (Division of Provincial Irrigation Services; the project representative at district level) was only responsible to the project leader at the provincial level. See Figure 2.3 for an overview of structural and functional lines in the government organizational structure and Figure 2.4 for an overview of a project management unit using the structure of the IMT project under the IWIRIP at the provincial level as an example. The relationship between the MoF and the sectoral ministries was reshaped with the adoption of the project approach. Prior to the adoption, the MoF decided the allocation of development funds for each sectoral ministry (as proposed by the sectoral ministries) based on the country’s fiscal balance. In this way, overspending of state revenue was prevented because the amount of development funding disbursed could not exceed the available government revenues. Following the adoption of the project approach, sectoral ministries depended primarily on donor support for their budget allocation. According to interviews with MoA, MoHA, and Kimpraswil officials in 2003, one reason that the sectoral ministries were interested in receiving as many donor loans as possible was because they were not directly responsible for their repayment. As expressed by an MOA official in 2003: The way the sectoral development fund was disbursed from foreign loans did not encourage the sectoral ministries to limit their budget spending. [They] would never limit their loan proposals or refuse any loan offers from the donors because they were relieved from any responsibility to repay the loan.

In the irrigation sector, the MPW collected as many loans as possible, regardless of its ability to repay any monies. Formally, the MoF was entitled

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FIGURE 2.3 Structural and Functional Lines within the Government Organization Minister Ministerial level

DG Water Resources Head Irrigation Dir Unit Head Unit Staff MPW regional office

Governor Provincial level

Project Head Assistants

PWRS Head SubProject Head PIA Head Project Staff Section Head Section Staff

District level

District Head DWRS Head

DPIS Head DPIS Staff

Section Head Section Staff Structural line

Functional line

to reject a loan agreement proposed by the sectoral ministries if the loan was viewed as economically unfeasible (i.e., considered too large for the government to be able to repay it). In practice, the MoF approved every loan proposal because it viewed all loans as the country’s main development

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Financial Assistance Implementation Assistance Planning Assistance Treasurer

Project Head

FIGURE 2.4 Overview of the Provincial Level Project Management Unit under the Indonesia Water Resources andIrrigation Reform Program (IWIRIP)

General Assistance

32

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Treasurer Sub-project Water Management

Monitoring staff Administrative staff

Subproject Irrigation Planning

Monitoring staff Administrative staff

Treasurer

Treasurer Subproject Irrigation Bantul & Gunungkidul

Monitoring staff Administrative staff

Treasurer Subproject Irrigation Kulon Progo District

Monitoring staff Administrative staff

Treasurer Subproject Irrigation Sleman District

Monitoring staff Administrative staff

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funds resource.88 See Figure 2.5 for the procedures for development fund proposals and allocation as applied before and after the adoption of the project approach. Last but not least, with the project approach, development funds in the ministries were divided between routine and project funds (or development funds). Routine funds, used to cover administrative expenses of the government ministries (including salaries), came from the state’s taxes and were managed by the MoF. Project funds, used to conduct development activities, came from foreign loans and were managed separately by project leaders under each sectoral ministry. Routine funds were continuously disbursed from the MoF to the sectoral ministries for each new fiscal year, while project funds were disbursed from foreign donors to the sectoral ministries according to the loan agreement. Project funds were supposed to be fully spent before the project was completed and were managed more flexibly than routine funds. At the ministerial level, each financial section within each directorate was involved in the management of routine funds. This is in contrast to each project fund, which was managed almost exclusively by the project leader and the central government supervisors.

The Project Development Approach and Systemic Rent-Seeking Practices Clearly, in Indonesia, corruption flourished with the introduction of the project approach. Government ministries lacked the interest to use project funds effectively, because project procedures encouraged complete spending of the project budget. Theoretically, complete budget spending indicated optimal progress of project activities (see Ferguson and Hoebink on how relationships between completed budget spending and optimal project progress were often not linked).89 The tendency to fully spend the allocated project fund was related to how budget planning was defined within the project approach. The planned allocation was based on the project expenditure of previous years. For example, when a project leader did not completely deplete the project fund, the fund received a reduced amount in the following year. Consequently, a project leader would rather waste the fund than return the unused portion to the central ministry.90 Additionally, project funds were perceived as “gifts”. No one was concerned about the actual use of a project fund, as long as it was fully spent. As

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State revenues

BEFORE:

Development fund allocation

State expenditures

Foreign loan allocation to sectoral ministries

Foreign loan approval

Ministry of Finance

Ministry of Finance

Indonesia’s Fiscal Balance

Sectoral ministries’ development proposals

Foreign loan negotiations between donor and sectoral ministries

Sectoral ministries’ development proposals

AFTER:

FIGURE 2.5 Formal Procedure in Fund Proposal and Allocation (Before and After the Adoption of the Project Approach)

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a former project leader in Yogyakarta told me in 2004: “Project activities were conducted simply to spend the allocated project fund”. In practice, a project leader focused job performance on the formal financial report matching the amount of reported project budget costs to the planned expenditure of the project funds, regardless of how these project funds were actually spent.91 Widespread collusion between government audit systems at the sectoral ministerial level (the inspectorate general and project management structure) and above it (at the BPKP and the BPK) hampered the control mechanisms in project fund management and reduced project financial audits to mere administrative exercises. For instance, evidence from World Bank supervised projects and BPKP audits suggests that a project financial report92 rarely included independent verification from third parties confirming the detailed quantities and specifications of goods delivered or works completed:93 project financial reporting did not reflect actual fund management. As stated in the World Bank (2003a) report on corruption in Indonesia: “While there is no shortage of auditing, the audit process is flawed” (p. 45).94 Or, as paraphrased by various officials from the MoA and the MoHA in 2004: the rent-seeking problem around project fund management lies in the co-optation of external financial auditors into the project system. This collusion in project fund management was rooted in the relationship between the provincial-level project leader, the central government supervisors, and the contractors. And from an interview with a PIA official in 2004, discussing poor workmanship: A project leader’s role in monitoring the contractor’s actual work became meaningless due to the close relationship between contractors, a project leader and his or her bureaucratic supervisors. As both the project leader and his or her supervisors would get financial benefits from the contractor’s ability to build the proposed infrastructure with relatively lower costs, which often resulted in poor infrastructure quality, they tended to cover up the contractor’s poor work.

The project leader would also distribute a portion of the funds to the officials in charge of monitoring the project fund management (in the respective ministry, in the BPKP, and in the BPK) to ensure their cooperation. Next, the systemic delay in the actual allocation of a project fund created perverse incentives for government agencies to transfer funds to bank accounts outside the control of the government and to generate

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false documentation on project progress, leaving the door wide open for abuse.95 Fund transfers were necessitated by the need to hide unused project funds at the end of each year. Theoretically, project funds were to be allocated to the regional level at the beginning of the calendar year, in January or February. In practice, however, funds reached the regional level only in June or July, leaving the project head with less than half a year to conduct the planned development activities and to spend the allocated funds. During an interview in 2004, an official in the PIA, who was also a former project leader, told me: Due to the late budget release, the project head had less than six months to perform all the targeted works. Reacting to this rather unrealistic target, the project head often had to process different kinds of payments at the last minute before the end of the fiscal year. Sometimes, the project head had to process payments before project activities were even started.

In recent World Bank missions to supervise a development project in one Indonesian city, it was learned that in sixteen civil works contracts, a majority of the payments to contractors, had been processed by government treasury offices in December, just days before the calendar year-end, often on the last day of the contracts, and without any direct control on work progress in the field.96 Furthermore, excluding quality measurements from the actual project evaluations allowed project leaders to hide mismanagement of project funds. According to the project procedure, project activities should be evaluated based on the quality and the quantity of works and the deadline for completion.97 In reality, the quality aspect was often overlooked during the project evaluation due to the difficulty of setting a standard or defining such qualitative measurements. Consequently, the project leader could easily manipulate the project report, primarily to give the impression that project activities were fulfilling project targets, even if these targets were only achieved on paper. In the irrigation sector, a project leader could report the number and the size of the infrastructure built within the defined time target regardless of the quality of the constructed infrastructure,98 not to mention the fact that sometimes, when site visits were conducted by project evaluators (such as World Bank staff or its consultants), they often found that the infrastructure had not even been built.99 In addition, how the penalty system within the project structure was actually applied allowed project leaders to continuously neglect quality assessment in project evaluation. A project leader’s supervisor should have

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instructed the project leader to confront contractors about any emerging project failures. In practice, a project leader would never do this because, as noted above, contractors charged with failures reflected negatively on the project leader’s own performance. Ironically, a new project was often formulated as a standard response to “reward” project failures, where the purpose of the new project was to deal with the poor workmanship of a previous project.100 As expressed in an interview in 2004 with an official in Kimpraswil: “As long as there is something to be built and rehabilitated, there is always a reason to formulate new projects”. Unsurprisingly, one project was followed by another because poor work quality was apparent in almost every project. For example, most construction projects on Java were followed by rehabilitation projects, focusing on the replacement of the poorly constructed infrastructure. Central ministries often used their decision-making power to define project fund allocation as their bargaining weapon to demand a certain amount of informal financial contributions from the regional governments. This contribution was often referred to as upeti, which translates as tribute to the king from his followers. As stated in the World Bank (2003a) report: Officials in project units and in regional government complain that release of project funds is subject to a variety of unofficial levies by central ministries to meet unspecified costs or simply as an inducement to expedite the transfer of funds, thus further tightening resources available to spending agencies. (p. 50)101

CONCLUSION In 2011, the characteristic of the Indonesian state as a rentier state remains prevalent in the aftermath of regional autonomy for three reasons: the government remains dependent on foreign loans to conduct the country’s sectoral development; the state–citizens relationship continues to be shaped by the government’s decision-making authority in development fund disbursement; and corruption practices continue to flourish following the political reform in 1998. Even after the fall of Suharto’s New Order government, new governments continue to reproduce the state’s basic power structure that is rooted in the political relationship between the president and the ministers. The Indonesian state’s foundation, as laid out by Suharto in his thirtytwo year reign, effectively remains untouched. Rather, the relationship between the president and the ministers, as crafted within the political

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party partisanship system, continues to govern the overall process of state (re)formation in post-Suharto’s Indonesia. Consequently, bureaucratic mechanisms of the present-day government ministries continue to be shaped by patron–client relationships, centred on the president’s position as the highest, if not the most important, patron. The overall application of regional autonomy did not result in the transfer of decision-making authority from the central government to the regional governments because of continued fiscal dependency. Regional development continues to be shaped primarily by project activities from the central ministries, conducted directly by its representatives in the project structure — the project leader. In the irrigation sector, this is certainly true. The project leaders continue to play a more influential role in directing regional development through project activities than the PIA or even the PWRS due to the access to project funds. Regional autonomy also did not eliminate the widespread corruption within the government organizational structure because sectoral development continues to be directed through the same mechanisms rooted in the project procedures and regulations. In the irrigation sector, the alliance between project leaders and central government supervisors remains intact. Like before, project financial reports are prepared primarily as administrative exercises. With the adoption of the project development approach, rent-seeking practices within the government agencies have been woven into the fabric of the bureaucracy. These practices have been internalized into bureaucratic procedures and formed an integral part of the applied project procedures and mechanisms, and therefore are nearly impossible to change. The government’s organizational structure and its bureaucratic procedures (primarily concerning the regulations in project fund disbursement) have been adapted in such a way as to sustain and reproduce these rent-seeking practices. Together with the application of the political party partisanship system, the way the project approach is applied in Indonesia has allowed the preservation of bureaucratic patrimonialism within the government agency; this will be the topic of the next chapter.

Notes   1. H. Mahdavy, “The Patterns and Problems of Economic Development in Rentier States: The Case of Iran”, in Studies in the Economic History of the Middle East, edited by M.A. Cook (London: Oxford University Press, 1970).

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  2. From the political science literature, the concept of a rentier state is mainly applied to resource-rich (mostly from oil and mining) countries in the Middle East. Mahdavy first developed the concept in 1970 after studying the economic problems in the Iranian government during the 1960s. A rentier state is often referred to as prebendal politics or a predator state (Bayart, Ellis, and Hibou 1999). J.C. Bayart, Stephen Ellis, and Beatrice Hibou, The Criminalization of the State in Africa (Bloomington: Indiana University Press, 1999); Mahdavy, The Patterns and Problems of Economic Development in Rentier States.   3. Kristopher W. Ramsay, Natural Disasters, the Price of Oil, and Democracy (Princeton, NJ: Department of Politics, Princeton University, 2006).   4. Henk G.C. Schulte-Nordholt, “Renegotiating Boundaries: Access, Agency and Identity in Post-Suharto Indonesia”, Bijdragen tot de Taal-Land-en-Volkenkunde, 159, no. 4 (2003): 550–89.   5. James T. Siegel, A New Criminal Type in Jakarta: Counter Revolution Today (Durham, NC: Duke University Press, 1998).   6. Henk G.C. Schulte-Nordholt, “A Genealogy of Violence”, in Roots of Violence in Indonesia, edited by F. Columbijn and Th. Lindblad (Leiden: KITLV Press, 2002).   7. Ramsay, Natural Disasters, the Price of Oil, and Democracy.   8. Sudipta Kaviraj, Politics in India (London: Oxford University Press, 1999).   9. R. Batley, Power through Bureaucracy: Urban Political Analysis in Brazil (London: Aldershot, Gower, 1983); H. Cohen, The Demonics of Bureaucracy: Problems of Change in Government Agency (Ames, IA: Iowa State University Press, 1965); B.G. Peters, The Politics of Bureaucracy (New York: Longman, 1984).   10. Didik J. Rachbini, “Political Economy of Business and Competition Issues in Indonesia”, Paper Presented at Global Forum on Competition, Organization for Economic Cooperative Development, Paris, 14–15 February 2002.   11. This lack of accountability is rooted in the so-called taxation effect (Yates 1996). This effect highlights that government is less likely to tax its citizens if it derives sufficient income from the available rents (foreign loans, in the Indonesian case). In turn, when local populations pay less tax to the government, they are less likely to demand accountability from their government, or in Yates’s words: “There can be no representation without taxation” (p. 35); Douglas Yates, The Rentier State in Africa (Trenton, NJ: Africa World Press, 1996).   12. See also Moss, Pettersson, and van de Walle on how the continuation of foreign loan discourages state revenue collection (Todd Moss, Gunilla Pettersson, and Nicolas van de Walle, “An Aid-institutions Paradox? A Review Essay on Aid Dependency and State Building in Sub-Saharan Africa”, Working Paper 74 [Washington, D.C.: Center for Global Development, 2006]).   13. Deborah Brautigam and Stephen Knack, 2004, “Foreign Aid, Institutions and Governance in Sub-Saharan Africa”, Economic Development and Cultural Change 52, no. 2 (2004): 255–85.

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  14. S.N. Eisenstadt, The Political Systems of Empires (Glencoe, IL: Free Press of Glencoe, 1963).   15. The continuation of bureaucratic patrimonialism was also highlighted by Schulte-Nordholt in his description of Indonesia as an “octopus” state, pointing out the existence of the “real” state, next to the presence of the formal state. “This real state consists of a formal set of bureaucratic institutions that coexists with a shadow state in which bureaucrats, businessmen, politicians and criminals interact on a regular basis” (Schulte-Nordholt, “Renegotiating Boundaries”, p. 560).   16. William S. Cole, “Roots of Corruption in the Indonesia System of Governance an Old Game or New? Corruption in Today’s Indonesia”, Asia Program Special Report No. 100 (Washington, D.C.: Woodrow Wilson International Centre for Scholars, 2001).   17. Vedi R. Hadiz, “Decentralization and Democracy in Indonesia: A Critique of Neo-institutionalist Perspective”, Working Papers Series No. 47 (Hong Kong: Southeast Asia Research Centre, City University of Hong Kong, 2003).   18. Leonard Wantchenkon, “Why Do Resource-dependent Countries Have Authoritarian Governments?”, Journal of African Finance and Economic Development 5, no. 2 (2002): 52–77.   19. The irrigation agency was under the MPW (pre-1998), Kimbangwil (1999–2001), or Kimpraswil (2001–present), depending on the time period.   20. The projects were the JIWMP and the IWIRIP.   21. Devesh Kapur, John P. Lewis, and Richard Webb, The World Bank: Its First Half-Century, vol. 1 (Washington, D.C.: Brookings Institution Press, 1997).   22. See the concept of bureaucratic polity (Jackson and Pye 1980; King 1979) and the application of bureaucratic patrimonialism (either cum military or cum corporatist) (Crouch 1986; MacIntyre 1994) with regard to the domination of the New Order executive body over the judicial and legislative bodies. (Harold Crouch, “Patrimonialism and Military Rule in Indonesia”, in The State and Development in the Third World, edited by Atuh Kohli [Princeton, NJ: Princeton University Press, 1986]; Karl D. Jackson and Lucian W. Pye, Political Power and Communications in Indonesia [Berkeley, CA: University of California Press, 1980]; Dwight Y. King, “Indonesia’s New Order as a Bureaucratic Policy: A Neo-patrimonial Regime or a Bureaucratic Authoritarian Regime, What Difference Does It Make?”, in Interpreting Indonesian Politics: Thirteen Contributions to the Debate, Interim Report Series No. 62, edited by Benedict Anderson and Audrey Kahin [Ithaca, NY: Cornell Modern Indonesia Project, 1979]; Andrew MacIntyre, ed., “Power, Prosperity and Patrimonialism: Business and Government in Indonesia”, in Business and Government in Industrializing Asia [Ithaca, NY: Cornell University Press, 1994]).   23. This political party partisanship system was briefly mentioned in the World Bank Report (2003a), in which the relationship between the president and the

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ministers was presented as the relationship between the “chief franchiser” and the “franchisee”. In this study, I base my analysis on interviews with policy actors from universities and NGOs and with government officials directly involved in the overall process of state (re)formation following the political reform in 1998. (World Bank, Combating Corruption in Indonesia: Enhancing Accountability for Development [Washington, D.C.: The World Bank, 2003a]).   24. Shanti Kothari and Ramashray Roy, Relation between Politicians and Administrators at the District Level (New Delhi: Indian Institute of Public Administration, 1969).   25. See Huntington (1970) for the functional role corruption plays in maintaining a political system or strengthening political parties, and see Scott (1970) on the discussion on systemic corruption as part of the state’s political “machine”, whose function is to secure office for its leaders and to distribute income to those who run it and work for it. (Samuel P. Huntington, “Modernization and Corruption”, in Political Corruption: Readings in Comparative Analysis, edited by A.J. Heidenheimer [Toronto, Canada: Holt, Rinehart and Winston, 1970]; James C. Scott, “Corruption, Machine Politics and Political Change”, in Political Corruption: Readings in Comparative Analysis, edited by A.J. Heidenheimer [Toronto: Holt, Rinehart and Winston, 1970]).   26. Transparency International, Transparency International Corruption Perceptions Index (Berlin: Transparency International, 1998).   27. Political and Economic Risk Consultation Limited, Report on Bureaucracy in Asia (Hong Kong: Political and Economic Risk Consultation, 1998).   28. Hans Antlov and Sven Cederroth, Elections in Indonesia: The New Order and Beyond (London: Routledge Curzon, 2004).   29. Robert Wade, “The Market for Public Office: Why the Indian State is Not Better at Development”, World Development 13, no. 4 (1985): 467–97.   30. David H. Bayley, “The Effects of Corruption in a Developing Nation”, in Political Corruption, Readings in Comparative Analysis, edited by A.J. Heidenheimer (Toronto: Holt, Rinehart and Winston, 1970); Jacob van Klaveren, “The Concept of Corruption”, in Political Corruption, Readings in Comparative Analysis, edited by A.J. Heidenheimer (Toronto: Holt, Rinehart and Winston, 1970).   31. A.J. Heidenheimer, Political Corruption, Readings in Comparative Analysis (Toronto: Holt, Rinehart and Winston, 1970).  32. Kompas, “Kwik Kian Gie’s Analysis on KKN in Indonesia”, 15 October 2003; Peter King, “KKN and the Future of Indonesia”, Paper presented at the International Institute for Asian Studies, Leiden, 15 June 2005.   33. Ross H. McLeod, “Dealing with Bank System Failure”, Bulletin of Indonesian Economic Studies 40, no. 3 (2004): 423–25.   34. Theoretically, staffs within the government ministries were only accountable to the president. This meant that legal and administrative sanctions could only be applied if the president chose to apply them.

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  35. Edward Aspinall and Marcus Mietzner, Problems of Democratization in Indonesia: Institutions, Elections and Society (Singapore: Institute of Southeast Asian Studies, 2009).   36. Cendana is the road where Suharto’s family lived in Jakarta. This reference also symbolizes the patron–client relationship between Suharto and his officials.   37. World Bank, Combating Corruption in Indonesia.   38. Similarly, related to its scope of authority, the position of MoHA minister had always been held by officials with close connections to Suharto.   39. Erna Witoelar belonged to Wahid’s inner circle of power, so she immediately resigned from the minister’s post when Wahid was forced from office in 2001. Similarly, Soenarno was a member of the Partai Demokrasi Indonesia as the ruling political party under the Megawati presidency.   40. Decentralization was not a new phenomenon in the country’s political history. Decentralization policies were formulated during the late colonial period, as well as during the Soekarno and Suharto presidencies; yet, prior to regional autonomy, decentralization was never widely applied (Holtzappel, Sanders, and Titus 2004; Legge 1961; Malley 2003). Coen Holtzappel, Martin Sanders, and Milan Titus, eds., Riding a Tiger: Dilemmas of Integration and Decentralization in Indonesia (Amsterdam: Rozenberg Publishers, 2004); J.D. Legge, Central Authority and Regional Autonomy in Indonesia: A Study in Local Administration 1950–1960 (Ithaca, NY: Cornell University Press, 1961); Michael S. Malley, “New Rules, Old Structures and the Limits of Democratic Decentralization”, in Local Power and Politics in Indonesia: Decentralisation & Democratization, edited by Edward Aspinall and G. Fealy (Singapore: Institute of Southeast Asian Studies, 2003).   41. Millidge Walker, “Decentralized Planning for Sustainable Development: The Case of Indonesia”, Review of Urban and Regional Development Studies 3 (1991): 94–102.   42. Regional governments are composed of two levels: the first is the different regions’ provincial governments, which oversee the second level, the district governments. When I use the term regional government, it is meant in broad terms. The central government’s ministries oversee the provincial governments, and, as will be discussed in this chapter, control some of the district governments’ functions.   43. S. Haris, Desentralisasi dan Otonomi Daerah: Desentralisasi, Demokratisasi dan Akuntabilitas Pemerintahan Daerah [Decentralization and Regional Autonomy: Decentralization, Democratization and Regional Government Accountability] (Jakarta: LIPI Press, 2005).   44. The decision to transfer authority to the district governments was also supported by past experience with decentralization (Devas 1997). In 1995, the New Order government introduced a two-year pilot project on district autonomy. Through this project, central government’s selected functions were

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transferred to twenty-six district governments or 10 per cent of all district governments in Indonesia at that time. (Nick Devas, “Indonesia: What Do We Mean by Decentralization?”, Public Administration and Development 17 (1997): 351–67.   45. Edward Aspinall and G. Fealy, eds., “Introduction: Decentralisation, Democratisation and the Rise of the Local”, in Local Power and Politics in Indonesia: Decentralisation & Democratization (Singapore: Institute of Southeast Asian Studies, 2003); G. Fane, “Change and Continuity in Indonesia’s New Fiscal Decentralization Arrangements”, Bulletin of Indonesian Economic Studies 39, no. 2 (2003): 159–76.   46. Riyadi Suparno, The Political Economy of Intergovernmental Transfers in Indonesia (M.Sc. thesis, University of Birmingham, UK, 2004).   47. B. Brodjonegoro and S. Asanuma, “Regional Autonomy and Fiscal Decentralization in Democratic Indonesia”, Hitotsubashi Journal of Economics 41, no. 2 (2000): 111–22.   48. Ryam Rasyid, “Otonomi Daerah: Latar Belakang dan Masa Depannya” [Regional Autonomy: Background and its Future], in Desentralisasi dan Otonomi Daerah: Desentralisasi, Demokratisasi dan Akuntabilitas Pemerintahan Daerah [Decentralization and Regional Autonomy: Decentralization, Democratization and Regional Government Accountability], edited by S. Haris (Jakarta: LIPI Press, 2005).   49. Prior to regional autonomy, district heads and governors were appointed by the central government through the MoHA.   50. Prior to regional autonomy, the central government defined and managed the actual fund allocation to the regional level through its subsidies, development aid, and project funds (Mahi and Adriansyah 2003). Government subsidies (also referred to as routine funds) were disbursed primarily to cover regional government staff salaries at provincial and district levels. During the New Order government, development aid was allocated based on instructions given by the president. Unlike subsidies and government aid funds, project funds were transferred not to the regional governments, but to the project staff at the central ministries’ regional offices. (B. Raksaka Mahi and Adriansyah, “Sejarah Transfer Keuangan Pusat ke Daerah” [History of Financial Transfer from Central to Regional Government], in Dana Alokasi Umum (DAU): Konsep, Hambatan dan Prospek di Era Otonomi Daerah [DAU: Concept, Problems and Prospect in Regional Autonomy Era], edited by Machfud Sidik (Jakarta: Penerbit Buku Kompas, 2003).   51. B. Brodjonegoro and A.T. Pakpahan, “Evaluasi atas Alokasi DAU 2001 dan Permasalahannya”, [Evaluation and Allocation of DAU and Its Problems], in Dana Alokasi Umum (DAU): Konsep, Hambatan dan Prospek di Era Otonomi Daerah [DAU: Concept, Problems and Prospect in Regional Autonomy Era], edited by Machfud Sidik (Jakarta: Penerbit Buku Kompas, 2003).

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  52. Though, again, this decision was to be approved at the ministerial level. However, in most cases, both the minister and the director general would approve the candidate proposed by the PIA leader.   53. World Bank, Decentralizing Indonesia: A Regional Expenditure Review Overview Report (Jakarta: World Bank Indonesia, 2003b).   54. H.A.W. Widjaja, Otonomi Daerah dan Daerah Otonom [Regional Autonomy and Autonomous Region (Jakarta: PT Raja Grafindo Persada, 2002).   55. Roy W. Bahl and B. Tumennasan, “How Should Revenue from Natural Resources be Shared in Indonesia?”, Working Paper No. 02-14, Paper presented at Andrew Young School of Public Policy Conference, Georgia State University, 1–3 May 2002; Suparno, The Political Economy of Intergovernmental Transfers in Indonesia.  56. Kompas, “Calo untuk Urus DAU Gentayangan di Depdagri” [Brokers to Process DAU Roam at the Ministry of Home Affairs], 6 December 2001.   57. While the DAU was designed to eliminate vertical fiscal imbalances (between the central and regional governments), in practice, the DAU application has been less equalizing due to its role in creating horizontal fiscal imbalances (between regional governments). The way the DAU was applied advantaged the resource-rich regions, as high-producing regions or regions with higher tax bases received a larger share than regions that were poor in terms of natural resources and tax bases (Brodjonegoro, Paddue, and Sato 2003). (B. Brodjonegoro, H. Paddue, and M. Sato, “Intergovernmental Transfers and Tax Sharing in Indonesia: Theories, Practices and Policy Recommendation”, Paper Presented at Indonesia’s Decentralization Policy: Problems and Policy Directions, Jakarta, 4–5 September (2003).   58. Fane, “Change and Continuity in Indonesia’s New Fiscal Decentralization Arrangements”.   59. Ibid.   60. Ilyas Saad, “Indonesia’s Decentralization Policy: The Budget Allocation and Its Implications for the Business Environment”, Paper presented at EUROSEAS Conference Panel on Decentralization and Democratization in Southeast Asia, London, September 2001; Roy Kelly, “Property Tax Reform in Indonesia: Emerging Challenges from Decentralization”, Asia Pacific Journal of Public Administration 26, no. 1 (2004).   61. Asia Foundation, Indonesian Rapid Decentralization Appraisal (IRDA): Second Report (Jakarta: Asia Foundation, 2002).   62. Syaikhu Usman, “Regional Autonomy in Indonesia: Field Experiences and Emerging Challenges”, Paper presented at the Seventh PRSCO Summer Institute/Fourth IRSA International Conference: Decentralization, Natural Resources and Regional Development in the Pacific Rim, Bali, 20–21 June 2002.

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  63. World Bank, Decentralizing Indonesia.   64. Fane, “Change and Continuity in Indonesia’s New Fiscal Decentralization Arrangements”.   65. Suparno, The Political Economy of Intergovernmental Transfers in Indonesia.   66. Ryam Rasyid was the minister of the MoHA at that time and a prominent supporter of regional autonomy.   67. Rasyid, “Otonomi Daerah” [Regional Autonomy].   68. Ibid.   69. Syaikhu Usman, “Regional Autonomy in Indonesia”.   70. Brodjonegoro and Asanuma, “Regional Autonomy and Fiscal Decentralization in Democratic Indonesia”.   71. Rasyid, “Otonomi daerah” [Regional autonomy].   72. Schulte-Nordholt, “Renegotiating Boundaries”.  73. Suara Pembaruan, “Anggota DPRD Buru Ditangkap: Terkait Korupsi, Mantan Ketua dan Wakil Ketua DPRD Banggai Diperiksa” [Local Parliament Member in Buru Was Caught: Related to Corruption, Former Head and Vice Head of Local Parliament in Banggai Were under Investigation], 1 November 2004a; Suara Pembaruan, “Penyidikan Korupsi di DPRD Kota Malang Dinilai Lamban” [Corruption Investigation in Malang is Considered Slow], 24 November 2004b.   74. Schulte-Nordholt, “Renegotiating Boundaries”.   75. Kazuhisa Matsui, “Decentralization in National State-building in Indonesia”, Research Paper No. 2 (Tokyo: IDE-JETRO, 2003).   76. R. Emilia, “Dilema Perimbangan Keuangan Pusat-Daerah” [The Dilemma in Balancing Central and Regional Finance], in Desentralisasi dan Otonomi Daerah: Desentralisasi, Demokratisasi dan Akuntabilitas Pemerintahan Daerah [Decentralization and Regional Autonomy: Decentralization, Democratization and Regional Government Accountability], edited by S. Haris (Jakarta: LIPI Press, 2005).   77. Officially this activity title included events such as coordination meetings on IMT, discussions on annual budgets, national workshops, consultation with central government, and regional financial workshops.   78. IWIRIP, Progress Report: Thirty-second Quarterly Period April–June 2003 (The Netherlands: DHV Consultants BV, 2003).   79. Widjojo Nitisastro, The Indonesian Development Experience: A Collection of Writings and Speeches of Widjojo Nitisastro (Singapore: Institute of Southeast Asian Studies, 2011).   80. World Bank, Combating Corruption in Indonesia.   81. D. Hulme, “Projects Politics and Professionals: Alternative Approaches for Project Identification and Project Planning”, Agricultural Systems 47 (1995): 211–33; Dennis A. Rondinelli, “Projects as Instruments of Development

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Administration: A Qualified Defence and Suggestions for Improvement”, Public Administration and Development 3 (1983): 307–27.   82. Rachbini “Political Economy of Business and Competition Issues in Indonesia”.   83. Effendi Pasandaran, Politik Ekonomi Reformasi Irigasi di Indonesia [The Political Economy of Irrigation Reform in Indonesia], Paper Presented at the Research and Development Unit, Ministry of Agriculture, Jakarta, Indonesia, 12 August 2003.   84. ISSP I and II are discussed in Chapter 4.   85. With this adoption, the shaping of the Indonesian state as a developmentalist, interventionist state began (Anderson 1991). Benedict R. O’G Anderson. Imagined Communities: Reflections on the Origin and Spread of Nationalism (London: Verso, 1991).   86. A. Booth, Agricultural Development in Indonesia (Sydney: Allen and Unwin, 1988); Benedict R. O’G Anderson, Language and Power: Exploring Political Cultures in Indonesia (Ithaca, NY: Cornell University Press, 1990); Rachbini “Political Economy of Business and Competition Issues in Indonesia”.   87. Kapur, Lewis, and Webb, The World Bank: Its First Half-Century.   88. In some cases, the MoF would approve the loan proposal, but then only be able to pay the interest on the previous loans.   89. James Ferguson, The Anti-politics Machine: Development, Depoliticisation, and Bureaucratic Power in Lesotho (Minneapolis, MN: University of Minnesota Press, 1997); Paul Hoebink, The Netherlands Yearbook on International Cooperation (Assen: van Gorcum, 2007).   90. World Bank, Combating Corruption in Indonesia.   91. Ibid.   92. In general, project financial reports provide an internal document called a Berita Acara Pembayaran, which gives details of a payment request and confirms that this payment has been fulfilled.   93. World Bank, Combating Corruption in Indonesia.   94. Ibid.   95. Ibid.   96. Ibid.   97. When a project failed to meet these targets, it was blamed on the project leader’s poor performance.   98. Similarly, in IMT implementation, the project leader could report the number of FWUAs formed within the defined time frame, regardless of the FWUAs’ actual organizational functioning.   99. World Bank, Combating Corruption in Indonesia. 100. Ferguson, The Anti-Politics Machine. 101. World Bank, Combating Corruption in Indonesia.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

3 THE IRRIGATION AGENCY’S CONTESTED BUREAUCRATIC IDENTITY

INTRODUCTION This chapter explores the irrigation agency’s bureaucratic identity, and how it is sustained and reproduced by core policy actors’ interests and strategies (see Sabatier and Jenkins-Smith1 for a definition of core policy actors). It describes the agency’s main attributes, which are its orientation towards infrastructure development and its focus on bureaucratic rent-seeking. These mutually reinforcing drivers of agency behaviour are translated into specific management rules and procedures in and around the project development approach. This chapter also analyses how the agency’s identity was contested by the shift in international policy trends in the late 1980s and again with the Indonesian political reform of 1998, and, finally, how its identity was affected by the major changes in its organizational structure when the Ministry of Settlement and Regional Development (Kimbangwil) was formed in November 1999, to replace the Ministry of Public Works (MPW), in directing irrigation sector development.

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I discuss the irrigation agency’s bureaucratic identity as the product of “bureaucratic capitalism” (Section I), and illustrate how the agency’s organizational foundation is based on infrastructure-oriented irrigation development (i.e. construction and rehabilitation) and how its bureaucratic mechanisms are shaped by the practice of bureaucratic rent-seeking (Section II). This chapter goes on to clarify how rent-seeking rules are established in the actual management of project funds (Section III). Details are given on how the policy shifts in irrigation systems management — from infrastructure to system operation and maintenance (O&M) and farmer empowerment, and later to irrigation management transfer (IMT) — were hampered by core policy actors’ resistance to change (Section IV). This chapter ends with how these same actors’ bureaucratic powers were diminished with the abolition of the MPW and the establishment of Kimbangwil in 1999, which were later restored with the transition into Kimpraswil in 2001 (Section V).

SECTION I: THE IRRIGATION AGENCY’S BUREAUCRATIC IDENTITY I define the irrigation agency’s bureaucratic identity as the product of accelerated bureaucratization or what Evers calls “run-away bureaucratization” (p. 666). 2 According to Evers, the process of bureaucratization in Indonesia resulted in retarded Weberian bureaucracy, where the rapid growth in government personnel was not accompanied by a growth in its ability to perform the assigned bureaucratic tasks.3 In contrast to Weberian bureaucracy, the Indonesian bureaucracy is characterized by the increasing use of informal rules and the unification of official and private life: “The Indonesian bureaucracy is a product of patrimonial bureaucratic authority, in which the demarcation between public service and private interest is at best blurred” (p. 24).4 Indonesian bureaucracy resembles the characteristics of “bureaucratic capitalism”,5 in which the government bureaucracy works as the medium to integrate the existing power structure into a modern capitalist economy.6 Under bureaucratic capitalism, bureaucratic position becomes the means to provide government officials with patronage for themselves, their families, and the political factions to which they owe their authority. In Indonesia, this was evident in the way high-level bureaucratic officials (especially the military in Suharto’s New Order government) extended their control into the national economic sphere.7

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With reference to bureaucratic capitalism, primarily its high-level officials, or so-called core policy actors, shape the irrigation agency’s identity.8 Within this core group are found both retired and active officials with close connections to present and former ministers (and connections also to present and former director generals, project leaders, secretary generals, inspector generals, etc.). The power of these active high-level officials resides in their authority to regulate bureaucratic positions within the agency. For instance, through their formal decision-making power, they can promote or replace officials to strengthen their alliance in the agency,9 or, as project leaders’ supervisors, they can use their access to project funds as financial means to shape decisions made within the agency. The retired officials’ power, on the other hand, resides in their role as policy brokers to negotiate policy ideas from lower-level officials, regional governments, or non-governmental organization (NGO) representatives, in relation to the irrigation agency’s formal policy guidelines. The power of these retired officials relies primarily in their ability to exert influence on the bureaucratic leadership, and thus indirectly steer the decision-making process within the agency at its highest level, in relation to proposed policy ideas. For instance, it is possible that any current director general, or even minister, was once a staff member to any retired high-level official. What is more, these retired officials can direct their strategies more flexibly because they are no longer formally connected with the agency. They can, for example, make a suggestion directly to a minister that certain policy steps be taken, without fear for own careers. In addition, through their broad bureaucratic connections, retired officials play an important role in negotiating crosssectoral working relationships.

SECTION II: THE STRUCTURAL PROPERTIES OF THE IRRIGATION AGENCY I illustrate how the irrigation agency’s organizational foundation is based on infrastructure-oriented irrigation development. I also discuss how the agency’s bureaucratic mechanisms are shaped primarily by the practice of bureaucratic rent-seeking.

The Irrigation Agency and Infrastructure-Oriented Development Starting in the late 1960s, Indonesian irrigation sector development was

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focused on the construction and rehabilitation of physical irrigation infrastructure, which is used to support the country’s food policy on rice self-sufficiency.10 With the introduction of high-yielding varieties of rice and the “green” revolution, infrastructure-oriented development was focused on constructing technical irrigation systems and on upgrading the existing non- and semi-technical irrigation systems into technical ones. Technical irrigation systems are systems that have a permanent dam and networks of (partial) concrete irrigation canals and are equipped with different kinds of water control or measurement devices (such as sluice gates, weirs, siphons, and, in some cases, Cippolettis). Technical irrigation systems are operated by specialized staff. Non-technical irrigation systems are village systems with a temporarily or semi-permanent infrastructure, mostly earthen dams and canals, and are operated by farmers. Semi-technical irrigation systems are, as might be deduced, systems with some permanent infrastructures that are not yet fully developed. Semi-technical irrigation systems are operated by both the irrigation agency and the farmers. The strong emphasis on construction and rehabilitation can be seen in the country’s investment pattern in the irrigation sector. An overview of budgetary expenditure on irrigation development from Repelita I to IV, the five-year development plans from 1969 to 1983, is presented in Table 3.1. Investment in irrigation infrastructure grew dramatically through the first three Repelitas.11 For instance, in the third Repelita, the total amount of development funding spent on the construction of new irrigation systems reached Rp358 billion or nearly ten times the budget spent on construction during the first Repelita. Similarly, the total amount of development funding spent on rehabilitation in the third Repelita reached Rp263 billion, which was three times that spent in the first Repelita. This dramatic budget growth during the first three Repelitas was made possible by foreign loans. According to Klas Ringskog,12 the Indonesian government received about US$1 billion from the World Bank between 1969 and 1997: US$100 million during the 1970s, US$300 million during the 1980s, and US$600 million during the 1990s. During the first Repelita, development funds for the irrigation sector primarily originated from PROSIDA (Irrigation Project Funded by the International Development Agency), a project funded by the World Bank that focused on the construction and rehabilitation of irrigation infrastructure on Java. It started in 1969 and finished in 1989. During the 1970s, budget growth in the country’s overall development resulted in the formation of a massive government bureaucracy. In general,

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TABLE 3.1 Total Irrigation Development Expenditure by Type of Development, Repelita I–IV Rehabilitation

New construction

Swamp tidal

River and flood control

Total

Repelita I (1969–1973) Percentage distribution Current cost Rp (billion) Real cost* Rp (billion)

42.3 50.5 73.7

Percentage distribution Current cost Rp (billion) Real cost* Rp (billion)

23.8 147.6 138.8

22.3 25.0 38.3

29.1 33.1 50.0

5.7 6.4 9.9

100.0 114.4 171.9

8.8 152.3 50.1

35.7 219.9 207.8

100.0 617.1 582.3

6.0 109.7 54.6

26.0 483.4 237.2

100.0 1,908.2 913.1

5.0 115.2 37.6

28.8 661.3 215.6

100.0 2,294.6 748.2

Repelita II (1974–1978) 31.9 197.3 185.7

Repelita II (1979–1983) Percentage distribution Current cost Rp (billion) Real cost* Rp (billion)

28.8 556.3 263.4

39.2 759.8 358.0

Repelita II (1984–1988) Percentage distribution Current cost Rp (billion) Real cost* Rp (billion)

24.0 550.5 179.5

42.2 967.6 315.5

Notes: *constant 1975/1976 rupiah. Source: Pasandaran and Rosegrant 1995.

the number of government staff grew from less than half a million in the mid-1970s to at least three million in the mid-1980s.13 In the irrigation sector, the MPW was equipped with extensive organizational units (as stated in Ministerial Decree Number 21 of 1984). The minister was supported by a ministerial advisory team: an inspector general, a secretary general, and four directorate generals (for housing, irrigation, road infrastructure, and research, respectively). The inspector general was supported by six inspectorate units, with each unit responsible for the development of a specific region. The MPW’s Directorate General of Irrigation consisted of three sub-directorates, specializing in river, swamp, or irrigation development. Each of these sub-directorates was equipped with three sub-subdirectorates (technical planning; implementation in east, west, and mid-regions; and maintenance) and separate administrative and financial units. An organizational chart of the Directorate General of Irrigation is presented in Figure 3.1.

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Finances Human Resources

Irrigation

Housing Program Guidance

Implementation West Secretary Director General

Secretary Inspector General

Inspector Region 1

Equipment Implementation Mid Implementation East Urban Road Development Program Guidance

Equipment Irrigation 1 Development Irrigation 2 Development

Secretary Director General

Inspector Region 2

Directory General Road Infrastructure

Inspector Region 4 Inspector Region 3

Directory General Irrigation

Inspector General

Inspector Region 6

Infrastructure Planning Urban & Regional Planning

Planning

Inspector Region 5

Drinkingwater Healthy Housing Program

Regional Offices

Equipment

Directory General Housing

Secretary General

Legal Matters

Housing Road Infrastructure

Secretary Director General

Research & Development

Ministerial Advisory Team Minister of Public Works

FIGURE 3.1 Organizational Chart of the Ministry of Public Works’ Directorate General of Irrigation, 1969–84

Cooperation Company Guidance

Secretary Director General

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Swamp Development River Development Program Guidance

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Following the implementation of the PROSIDA project, project management units were incorporated into the organizational structure of the Directorate General of Irrigation. For example, under PROSIDA, a special sub-directorate (Sub-Directorate Irrigation 2) was formed to manage the implementation of irrigation projects. The Directorate General of Irrigation also included the Sub-Directorate Program Guidance, which was responsible for the general preparation of project planning and initial funding arrangements. The Sub-Directorate Program Guidance, in turn, consisted of five sub-subdirectorates, dealing with project evaluation, inter-sectoral cooperation, foreign loan administration, irrigation, and river development planning, respectively. An overview of the organizational units within the Sub-Directorate Program Guidance is presented in Figure 3.2. With the incorporation of the project management units, the irrigation agency’s technical expertise became directed more and more towards a project management role. The fact that irrigation development was mediated through the project approach urged the engineers in the agency to expand their knowledge and experience outside their technical training. For example, as a project leader, one had to be able to: manage different project activities, monitor the progress of each activity, meet the defined targets, and deliver satisfactory project reports. Clearly, the bureaucratic career of engineers in the agency increasingly depended on their ability to undertake project management, in addition to their professional and technical responsibilities. This tendency towards project management was clearly visible in the reorganization of the irrigation agency in 1984, when the Sub-Directorates of River, Swamp, Irrigation 1, and Irrigation 2 — respectively responsible for river and swamp development and irrigation project implementation on Java and other islands outside Java — were replaced by the Sub-Directorate Program Guidance, Sub-Directorate Technical Guidance, and Sub-Directorate Implementation Guidance. With this replacement, the technical expertise (in, respectively, river, swamp, and irrigation) of the agency’s staff was intermingled and restructured according to project management needs. Program Guidance was responsible for planning and managing programme implementation, primarily those funded by foreign loans. Technical Guidance was responsible for preparing technical designs for construction and rehabilitation, and Implementation Guidance was responsible for project implementation in the mid-, west, and east regions (by MPW Ministerial Decree, Number 211 of 1984).

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Finances

Sub-SubDirectorate Inter Sectoral Cooperation

Technical Admin.

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Section Bilateral Support Section Multilateral Support Section Foreign Loan Admin. Section Foreign Loan Eval.

Section Agriculture & Forestry Envir. Geograph. & Dev. Coop. Section Industry Transport. & Transmigr. Pat.

Sub-SubDirectorate River Dev. Planning

General

Sub-SubDirectorate Project Evaluation

Foreign Loan Admin.

Sub-SubDirectorate Irrigation Dev. Planning

Administration

Sub-Directorate Program Implementation Guidance

FIGURE 3.2 Organizational Chart of the Sub-Directorate of Programme Guidance

Sub-SubDirectorate Foreign Loan Admin.

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Section Technical Irrigation Section Agric. & Environm. Socio-Economic Section Section Irrigation Management

Surveying Section Section River Dev. Region 1 Section River Dev. Region 2 Section River Dev. Region 3

Section Planning & Program Section Annual Program reg 1 Section Annual Program reg 2 Section Data & Statistics

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The Upeti System and Bureaucratic Rent-Seeking Bureaucratic rent-seeking, or upetism, was already operational within the government ministries in Indonesia prior to the introduction of the project approach, and it continued to flourish afterwards. As stated by a parliament member in Prakoso and Suryati (1986): “Upetism is a widespread problem within the Indonesian government. Corruption practices were institutionalized with the establishment of the upeti system”.14 Upetism comes from the word upeti, which translates as a tribute to the king from his followers. The practice of upetism was rooted in the feudal period, when a king’s power was legitimated by the amount of tribute he received from his followers.15 In return for these tributes, the king would protect the local population from outside threats, such as foreign invasions. In modern-day Indonesia, however, upetism is embodied in government officials’ interests in acquiring as much private gain as possible from their bureaucratic positions (primarily in the form of financial enrichment, but not limited to it). As mentioned by a retired official from the irrigation agency, interviewed in 2003: “These days, government agency staff’s work… is directed primarily by their interest in increasing their personal wealth using their bureaucratic positions”. Upetism practices begin with, and are rooted in, the political relationship between the president and the ministers. With reference to the political party partisanship system, government ministers have to sustain rent-seeking practices within their ministries because they are obliged to deliver a certain amount of upeti to the president,16 who uses these resources to sustain political power during the country’s national elections.17 In particular, “if the chief minister cannot continue to supply the center with the funds he promised as a condition of taking the job, he too will be dismissed”.18 In accepting the position, all ministers informally agree to use their position as the president’s direct access to development funds. In other words, no government official would have either the interest or the intention to abolish bureaucratic rent-seeking practices, as it is enforced by the bureaucratic leadership. For instance, Alatas19 suggests that one of the most important factors in combating corruption is leaders’ moral stature. Similarly, as a senior official from the Ministry of Agriculture (MoA) told me in 2004: “One cannot pursue a bureaucratic career if one does not want to join the common conspiracy within the government ministry, which is rooted in the practice of mass corruption”. In practice, almost every official

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is involved in corruption practices, directly or indirectly, partly because the existing bureaucratic mechanisms make it impossible for officials not to get caught up in the corruption networks (see Wade20 for a study on the market of public office in India). The widespread continued existence of the practice of upetism within Kimpraswil21 was clearly acknowledged to in the Kimpraswil minister’s speech, given during the inauguration of ministerial staff on 6 November 2003. This speech was titled, “No obligation to deliver upeti to high officials”, in which the minister emphasized the need to eliminate the corruption rooted in the upeti system. In the minister’s words: “I hereby emphasize that the obligation to deliver upeti to high officials should be abolished. Upeti should be forbidden”.22 Within the irrigation agency, the practice of upetism is rooted in a patron–client relationship between high-level officials and their staffs. As in feudal times, the decision making within the irrigation agency has taken the form of a bureaucratic patriarchy23 (see Wertheim24 on how this bureaucratic patriarchy was rooted in the eighteenth-century colonial bureaucracy in Java). The bureaucratic leaders’ words and decisions become the way of doing business.25 As stated by various officials from the National Development Planning Agency (NDPA)26 and the MoA in 2004: direct guidance and suggested hints given by the ministers are far more important than any formal bureaucratic rules. Similarly, as expressed by some officials in Kimpraswil in 2003, supervisory decision making within the irrigation agency does not really work; everything is still defined by the bureaucratic leaders. In this context, a minister or a director general could ask staff to conduct specific tasks, regardless of the formal bureaucratic rules. In turn, these bureaucratic leaders could then reward staff for their loyalty or outstanding “performance”. As stated by one official in Kimpraswil in 2003: “Once, I travelled with my wife to Europe. The cost for this trip was all covered by the minister. I received this privilege because I had saved almost Rp400 billion in dam construction. Through my design, a much cheaper dam was built”. Bureaucratic patriarchy is most apparent in the relationship between a project leader and the bureaucratic supervisor. High-level officials use their decision-making power as a resource to trade for bureaucratic positions and to ensure upeti from their staff. Lower-level officials focus their bureaucratic career on delivering upeti for these high officials in return for good job

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positions27 or positions that will give them direct access to development funds.28 Officials in the irrigation agency would deliver money, luxury goods, and additional services to their supervisors to get a project leader position, which was considered one of the best in the agency because of its access to project funds (interviews with officials from the MoA, the MoHA [Ministry of Home Affairs], and Kimpraswil in 2003 and 2004; also see Wade29 for a definition of desirable and undesirable posts). Similarly, officials in the agency would “donate” generously to, or even participate in arranging, an extravagant wedding ceremony for a high-level official’s child, or to pay for holiday package trips or overnight stays in luxury hotels. When one supervisor went abroad for work-related trips, his staff gave him money to cover his “informal” expenses (i.e. personal gifts for his family) (interviews with officials from Kimpraswil, 2003). Following their appointment, project leaders would focus on manipulating the management of project funds in such a way that they could use these funds to deliver an even larger upeti to ensure further bureaucratic promotions.30 For instance, Rizal Ramly, from Econit Advisory Group estimates that 30 per cent of the total amount of foreign loans received by the Indonesian government (almost US$13 billion) has been lost through corrupt avenues.31 The reproduction of bureaucratic mechanisms in the irrigation agency is directed towards the preservation of these high-level officials’32 importance, with regard to their access to both development funds and decision-making authority to direct programme implementation. First, high-level officials in the agency ensure their upeti collection by appointing their followers as project leaders, thus strategically using the project leader as their “service point”33 for upeti delivery. In addition, these officials can contact project leaders whenever they need additional upeti funds to cover incidental non-budgetary expenses, such as the financial costs involved in receiving foreign donor delegations as part of formal ministerial proceedings. For this reason, low- and mid-level officials in the agency refer to the project leaders as the “ATM” for high-level officials (interviews with NDPA, MoHA, and Kimpraswil officials in 2004). Second, high-level officials in the irrigation agency not only receive upeti but also indirectly steer the irrigation sector development when appointing their loyal followers as project leaders. In this context, the project leaders’ access to project funds is used as a financial medium to direct programme implementation. For example, high-level officials in the agency were able to redirect IMT implementation under the Water Sector Adjustment Loan (WATSAL)34

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towards an infrastructure-oriented programme by relying on their close connections with the project leaders. In short, as expressed by an official in Kimpraswil in 2003, talking about leverage in general: “Your bureaucratic power is linked to your access to development funds. Access to a large amount of development funds will render you the bureaucratic authority, and vice versa”. In the next section, I illustrate how institutionalized rent-seeking practices within the irrigation agency, no matter if under the MPW, Kimbangwil, or Kimpraswil, are rooted in the management of project funds.

SECTION III: RENT-SEEKING RULES IN PROJECT FUND MANAGEMENT Systematic rent-seeking practices within the government ministries are evident in how project funds are divided into budgetary and “nonbudgetary funds”. The budgetary fund is an officially registered project fund used to conduct project activities. The non-budgetary fund, on the other hand, is not officially registered, so it is informally used to cover “bureaucratic expenses”. As explained by an official in the MoA in 2003: In general, government ministries in Indonesia have both formal and informal financial systems. The management of this informal financial system varies between ministries, depending on the inter-personal relationship within the particular ministry. Yet, the management of both non-budgetary and budgetary funds is conducted like the two sides of a coin.

In addition to the two budget funds, there are two separate book-keeping systems in place. The main difference between the budget expenditures registered in the formal set of books and the non-budgetary funds expenditure registered in the second set of books is that non-budgetary expenditures are never made known to the public; hence, the need for two sets of books. Regarding the irrigation agency’s financial reporting, rent-seeking rules in the management of project funds are incorporated in project procedures on construction and rehabilitation activities. This incorporation is linked to the fact that, during and after PROSIDA, project activities focused primarily on physical development. The alliance between the project leader,

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supervisor, and contractors was, and remains, established within the context of systems construction and rehabilitation. For instance, the strategy of marking up the unit costs was mainly developed to cover rent-seeking in construction and rehabilitation activities. As expressed by officials from the MoA and the MoHA in 2003: The irrigation agency’s technical knowledge and experience enabled it to manipulate project financial reports on physical development in such a way that it is almost impossible for an outsider to discover that the reports had been manipulated. Similarly, as stated by officials from Kimpraswil in 2003: Between the late 1970s and early 1980s, the irrigation agency (then under the MPW) increased the unit costs for systems construction and rehabilitation by replacing proportional division structures and field intakes in almost all irrigation systems on Java with more expensive sluice gates. Furthermore, the huge amount of project funds for systems rehabilitation fuelled cycles of rent-seeking in and around infrastructure development. In general, non-budgetary funds act as a social security system within the irrigation agency. Apart from the upeti for the president and high-level officials, the non-budgetary fund of the irrigation agency covers health, education, and social expenses of its staff members (such as when anyone is severely ill, needs support to finance a child’s higher education, or requires extra cash to celebrate a wedding ceremony). However, these bureaucratic services are only paid to whose conduct is in line35 with the irrigation agency’s general priorities, as defined by the director general. Non-budgetary funds are also used to cover the costs of official visits made by the minister and other high level officials to different regions. These funds cover all the costs involved in arranging official meetings with regional governments and conducting field visits, which can include hotels, transportation, food and beverage consumption, conference room reservations, and so on, because these costs are not covered as part of budgetary project expenditure. As it was in the MPW and Kimbangwil, Kimpraswil lacks the financial resources to cover such costs from its own ministerial budget. The distribution of non-budgetary funds within the irrigation agency follows the so-called echelon system.36 Formally, it was created to represent the “modern bureaucratic state”.37 With reference to Weberian bureaucracy, the echelon system features a distribution of authority arranged systematically in accordance with generally applicable rules, and a hierarchy of offices that corresponds with a fixed order of procedural affairs

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with defined regulations. The echelon system is applied in all government ministries and to their representatives at the regional level. According to the echelon system, officials in the irrigation agency are categorized into echelon 1 (minister and the advisory team), echelon 2 (director generals, directors, secretary generals, and inspector generals), echelon 3 (heads of sections within the directorate), and echelon 4 (the remaining staff). With reference to the echelon system, every project leader within the irrigation agency38 plays an important role in shaping the distribution of non-budgetary funds. In general, project leaders take 10 per cent of the total project fund for personal use while disbursing39 20 per cent to high-level officials within the agency, regardless of their involvement in project activities (mostly to echelon 1 and 2 officials). At the provincial government level, between 10 and 15 per cent of the remaining funds are directly distributed to the leader’s supervisor and close staff in the Provincial Irrigation Agency. Similarly, at the district government level, project leaders unofficially disburse another 10 per cent of the funds among officials in the district irrigation agency. By the time project activities are about to be implemented, almost 50 per cent of any project fund has already evaporated (see Figure 3.3 for an example of fund distribution under the MPW). In practice, the percentage received by each actor varies from one project to another, depending mainly on how a project leader negotiates FIGURE 3.3 Overview of the Distribution of Project Benefits at the Ministry of Public Works

100

10% 20%

High IA officials

Project Head 15%

10%

70.0

59.5

53.6

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Project Funds

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with his or her supervisor and the appointed contractors. For example, a contractor might agree to channel 20 per cent of the contractor’s submitted costs to the high-level officials within the irrigation agency, if the project leader agrees to “ignore” the price mark-up in the contractor’s proposal. Or the contractor might agree to channel only 10 per cent40 if the negotiation between the contractor and the project leader is less successful or if the project proposal is made with realistic pricing (with less possibility for mark-up). This negotiation usually takes place during project tendering prior to any contractor’s appointment. In this way, project leaders’ selection of any contractor is based on the highest percentage of contractor costs re-disbursement to the irrigation agency, as agreed to by each contractor. In addition, project leaders usually choose contractors who tender the lowest prices for the proposed development activities to get the highest amount of “benefits” from project fund management — the lowest prices offer maximum project mark-up, ultimately making the project appear more expensive for recordkeeping purposes. To sweeten the deal, only contractors with close connections to the project leader or the supervisor are even allowed to enter the project-tendering process. In the next section, I illustrate how the agency’s core policy actors resisted reform of irrigation sector development policy because they perceived the proposed reform as a threat to their privileged position.

SECTION IV: BUREAUCRATIC IDENTITY AND RESISTANCE TO NEW POLICY TRENDS IN IRRIGATION During the late 1980s and mid-1990s, the shift in international policy on irrigation from construction and rehabilitation (that is, infrastructure projects) to O&M, and later to farmer participation and IMT as promoted by international donor agencies, did not result in actual policy change in post-Suharto Indonesia because the core policy actors in the irrigation agency effectively resisted any proposed policy reforms. They thought that the proposed shift to O&M would remove their access to development funds and bureaucratic power because it would change the rent-seeking rules as established in infrastructure-oriented irrigation development. As expressed by some retired officials from the irrigation agency in 2003: the focus in irrigation sector development changed several times, though in practice, nothing changed. The irrigation agency continued to concentrate its development efforts on infrastructure development because the

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reproduction of its bureaucratic mechanisms relied on construction and rehabilitation activities. Also, the core actors feared that the proposed policy shift from infrastructure-oriented programmes to O&M programmes would be followed by a shift of bureaucratic power to a new group of officials specialized in O&M. In Indonesian irrigation, even the formation in 1987 of a separate organizational section responsible for farmer empowerment within the irrigation agency, under the On-Farm Water Management Project (PTGA), did not result in the establishment of a unit that could redirect the existing infrastructure-oriented (irrigation development) programme into programmes involving O&M, greater farmer participation, or IMT. The PTGA was formed within the Directorate General of Irrigation as part of the loan agreement for the Irrigation Operation and Maintenance Project (IOMP) 1987 Statement.41 Officially, the PTGA was responsible for creating one common language between the engineers in the irrigation agency and the farmers in the regions, with regard to irrigation systems O&M. As stated by one of PTGA official in Yogyakarta in 2004: “PTGA put farmers, instead of irrigation infrastructure, as the focus of development”. In practice, as paraphrased by several senior officials from the MoA in 2003 and 2004: officials in the irrigation agency did not see how their bureaucratic interests could be linked to systems O&M. First, unlike construction and rehabilitation, O&M activities involved lesser amounts of development funds. Second, this fund was disbursed as a routine fund through government bureaucracy and not through project structures, which meant that more barriers had to be removed to manipulate the management of O&M funds. Third, and perhaps most important, O&M activities were perceived as the intrusion of a structural approach represented by construction and rehabilitation activities. In other words, the irrigation agency lacked42 the interest to promote O&M because a successful O&M programme could possibly break the lucrative cycle of bad construction– deferred maintenance–early rehabilitation, and thus destroy the very foundation of the agency’s existence. Consequently, the domination of civil engineers in the irrigation agency merely resulted in the PTGA’s incorporation into infrastructure-oriented irrigation development. The PTGA failed to meet its designated role in promoting greater farmer involvement in irrigation systems management. On the contrary, farmer “empowerment” consisted primarily of having their behaviour directed with regard to the O&M of the irrigation infrastructure,

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according to the engineers’ wishes. Farmers’ own perceptions on how the infrastructure should function remained uninvestigated. In short, policy change in the irrigation sector could only take place if the proposed change was in line with the way the irrigation agency perceived its role in the development of the sector. Put another way, policy change could have significant impact only if the agency was confident about the need for such change. In the next section, I analyse how in 1999 the new Indonesian government, through its anti-corruption movement, handled the problem of institutionalized corruption within the irrigation agency. This movement was manifested in the abolition of the MPW as one of the most corrupt government ministries at that time.43

SECTION V: BUREAUCRATIC REFORM IN THE IRRIGATION AGENCY In 1999, there was an anti-corruption movement in Abdurrahman Wahid’s presidency. The movement focused on the abolition of corrupt government ministries; among these was the MPW. First, I discuss how the core policy actors’ decision-making authority in the irrigation sector was reduced by the MPW’s abolition and then I detail how these actors were re-established with the formation of the Ministry of Settlement and Regional Infrastructure (Kimpraswil) in 2001.

The Abolition of the Ministry of Public Works The core policy actors in the irrigation agency were excluded from the overall decision-making process in water sector development when the Ministry of Settlement and Regional Development (Kimbangwil) was formed in 1999 to replace the MPW. Unlike before, the bureaucratic leader in Kimbangwil was someone with a strong NGO background. Prior to her position as minister, Erna Witoelar was actively involved in different civil society movements;44 after her appointment, she recruited her new staff in Kimbangwil mostly through her NGO connections. In addition to the formation of Kimbangwil, the abolition of the MPW led to the formation of the State Ministry of Public Works (or Meneg PU). Unlike Kimbangwil, which was run by a new minister, Meneg PU consisted primarily of “one hundred brightest officials”45 selected by high-level officials from the former MPW. Unwilling46 to join Kimbangwil, the core policy actors managed

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to sustain their status quo by forming the Meneg PU,47 which, in the aftermath of the political reforms in 1998, reflected both the fragmented decision making of state apparatuses in post-Suharto Indonesia and the actors’ strength in defending and protecting their bureaucratic positions. Nevertheless, they failed to sustain their decision-making authority to direct the sector’s development: apart from its (supposed) role in policy formulation,48 Meneg PU was not authorized to manage sectoral development funds or to handle development activities in the irrigation sector. In other words, other than its function to shelter former MPW actors within the irrigation agency, Meneg PU did not play any active role in irrigation sector development. Within Kimbangwil, the bureaucratic importance of the irrigation agency was diminished. The position of Directorate General of Irrigation was abolished with irrigation sector development incorporated into the Sub-Directorate of Rural Irrigation under the Directorate General of Rural Development (compare Figure 3.4 with Figure 3.5.). The technical guidance unit was also abolished;49 this unit had been one of the most powerful and most corrupt directorates under the Directorate General of Irrigation in the former MPW, and its power had been derived from its ability to cover the project leaders’ mark-ups of projects. The organizational structures of the MPW and Kimbangwil are presented in Figure 3.4 and Figure 3.5, respectively. Despite some major changes, in general, Kimbangwil’s organizational structure remained similar to that of the former MPW (see Egeberg50 on the role of bureaucratic structure in shaping bureaucratic choices and decision making). At the ministerial level, Kimbangwil was equipped with an inspector general (to monitor the ministerial programme), secretary general (to coordinate and plan the sectoral programme within the ministry), and director generals (responsible for programme implementation). Like in the former MPW, director generals reported directly to the minister. Three new directorate general positions were formed in Kimbangwil, in addition to retaining the two that carried over from the MPW.51 The three new directorate generals were the Directorate General of Urban Development, the Directorate General of Rural Development, and the Directorate General of Spatial Planning and Regional Development. In practice, former MPW officials who stayed at Kimbangwil did not consider the Kimbangwil minister as their new bureaucratic leader. As expressed by a former MPW official in 2003: She is not the person who can

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Irrigation Road Infrastructure Housing

Program Guidance Technical Guidance Urban & Rural Housing ImplementationEast ImplementationWest Implementation Mid

Program Guidance Technical Guidance

Regional Offices

Directorate General Housing Directorate General Road Infrastructure Directorate General Irrigation

Secretary General Inspector General

Minister of Public Works

FIGURE 3.4 Organizational Structure of the Ministry of Public Works, 1984–89

Ministerial Advisory Team

Research & Development

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Urban Roads Guidance Implementation East Implementation West Implementation Mid Program Guidance Technical Guidance Water Use & Safety Implementation East Implementation West Implementation Mid

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Regional Spatial Planning Special Regions Water Resources Management Rivers & Lakes Spatial Planning Information & Participation Program & evaluation People’s Housing & Housing Quality Improvement New Housing & Underdeveloped Regions Self-reliant Housing Housing Finance Program & evaluation Rural Irrigation Rural Development East Rural Development West Rural Development Mid

Officials from Regional Offices

DG Spatial Planning & Regional Development Directorate General Housing Development Directorate General Rural Development Directorate General Urban Development Directorate General Regional Infrastruct. Devt.

Inspector General

Secretary General

Research & Development

Ministerial Advisory Team Minister of Kimbangwil

FIGURE 3.5 Organizational Structure of the Ministry of Settlement and Regional Development (Kimbangwil) 1999–2001

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Program & evaluation Metropolitan City Urban Development East Urban Development West Urban Developent Mid Program & Evaluation National Road System Regional Road System Drinkwater & Sanitation Local Investment

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represent the irrigation agency. First, she did not have sufficient technical knowledge to direct irrigation sector development because she is not a civil engineer. Second, she did not come from the “right environment”. Her NGO background did not fit with the bureaucratic environment in the agency. Former MPW officials were also disturbed by the new Kimbangwil staff’s background as NGO staff: NGO people should not interfere in the irrigation sector development. They lacked the experience and knowledge in irrigation development. They always said that they represented farmers’ needs. In fact, their interest lay in pulling in as many job contracts as possible. Furthermore, the way officials in the irrigation agency viewed farmers’ capability would always be different from the way NGOs viewed it. NGO representatives would promote greater farmer involvement in irrigation system development because they thought farmers were able to take over the systems management. Officials in the irrigation agency, on the other hand, would sustain the agency’s role in systems development because we think farmers were unable to take over the systems management. It is like you view a glass as half full, another can view it as half empty (Interview with former MPW official in 2003).

Nonetheless, strong bureaucratic support from the new Kimbangwil minister enabled the key policy-makers52 in WATSAL to accelerate the speed of IMT policy formulation and implementation. Erna Witoelar was open to accepting policy suggestions made by the key policy-makers in WATSAL, and she cooperated in the transfer of decision-making authority in IMT formulation from a sectoral (within the irrigation agency) to an inter-ministerial, cross-sectoral decision-making platform (within the NDPA). Through this shift in the decision-making structure, former MPW officials who remained functional under Kimbangwil could not halt IMT policy formulation under WATSAL. Lacking any policy guidance (from the former core policy actors, now at Meneg PU), these officials could not defend their sectoral interests on the inter-sectoral decision-making platform. Additionally, several NGOs were added to the overall process of IMT policy formulation, once again lowering any power these former MPW officials held in Kimbangwil. As with MPW before it, upetism continued within the organizational structure of Kimbangwil. The abolition of the MPW did not eliminate

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the deeply imbedded corruption practices, which remained rooted in the relationship between high-level officials in the irrigation agency and their project leaders. In practice, systematic corruption53 continued to be applied in the overall management of project funds, with or without the involvement of the core policy actors. For example, in 2003 NDPA and MoHA officials told me that key policy-makers in WATSAL often received informal financial requests from newly placed high officials in Kimbangwil, even while they were directing the overall process of IMT implementation through the World Bank-funded Indonesia Water Resources and Irrigation Program.

The Re-emergence of the Core Policy Actors’ Importance In 2001, following the presidential change from Abdurrahman Wahid to Megawati Soekarnoputri, both Kimbangwil and Meneg PU were amalgamated into the Ministry of Settlement and Regional Infrastructure (Kimpraswil). Formally, the lack of bureaucratic experience and knowledge of Kimbangwil’s staff and its broad development agenda were presented as the main reasons behind the decision to unite the two ministries. According to my informants, however, the real reason behind the unification lay in the change of presidents, though Kimbangwil’s bureaucratic performance did play a role in its demise. In Indonesia, ministers’ positions are linked to their political positions. Each new president appoints new cabinet ministers, mostly based on their political loyalty towards the ruling political party. Like the president, Soenarno, the new Kimpraswil minister was a party cadre of the ruling political party at that time. The unification also occurred because Soenarno was a former MPW core policy actor. With his appointment, the ministry’s bureaucratic leadership once again represented the core policy actors’ position. Hence, the objective of retaining the bureaucratic importance of Meneg PU’s core policy actors in the irrigation agency was met with the change in presidency. The organizational structure of Kimpraswil is presented in Figure 3.6. The core policy actors resumed their role of directing sectoral development.54 Soenarno removed Witoelar’s staff from their decisionmaking positions and replaced them with officials belonging to his inner circle. This strategic move would become important during the forthcoming battles over IMT policy, as Soenarno purposefully replaced officials who were supportive of IMT with officials who were against it.

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National Spatial Planning Regional Development Spatial Planning East Spatial Planning West Spatial Planning Mid

Technical Guidance House Financing Housing East Housing West Housing Mid

Technical Guidance System Infrastructure Devt.

Regional Offices Staff

Directorate General Spatial Planning Directorate General Housing Directorate General Infrastructure Devt. Directorate General Urban & Rural Devt.

Directorate General Water Resources

Research & Development Secretary General Inspector General Construction & Investment Organ

Ministerial Advisory Team Minister of Kimpraswil

FIGURE 3.6 Organizational Structure of Ministry of Settlement and Regional Infrastructure (Kimpraswil), 2001–present

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Infrastructure Devt. East Infrastructure Devt. West Infrastructure Devt. Mid

Technical Guidance Water Resources Mngt. Water Resources East Water Resources West Water Resources Mid

Technical Guidance Metropolitan City Urban & Rural Devt. East Urban & Rural Devt. West Urban & Rural Devt. Mid

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The core actors’ successful effort to regain their bureaucratic power was reflected in Kimpraswil’s organizational structure, which resembled that of the former MPW. Structurally, no traces can be found of the bureaucratic reform conducted in 1999. The Directorate General of Irrigation in Kimpraswil was re-established under a new name: Directorate General of Water Resources. The other two Directorate Generals (of Housing and of Road Infrastructure) were restored.55 At the level of the Directorate General of Water Resources, the technical directorate was brought back to life; this was the unit that had been one of the most powerful and corrupt under the MPW. To complete the return, the former MPW’s logo was reintroduced as Kimpraswil’s logo. In 2004, core policy actors changed Kimpraswil’s name back to the MPW and in doing so, they erased all traces of past efforts to reform the irrigation agency. In my opinion, the success of the core policy actors’ efforts in regaining their bureaucratic importance derived from the fact that, after the abolition of the MPW, “bureaucratic reform” within Kimbangwil was limited to the sole appointment of one high-ranking pro-reformer Erna Witoelar. Under Kimbangwil, policy reform was formulated and implemented primarily through strong bureaucratic support from Witoelar. The majority of officials who had positions in Kimbangwil, however, were former MPW actors who continued to favour infrastructure-oriented irrigation development, not farmer empowerment. Officials who were supportive towards reform channelled policy information to Witoelar, but they were unable to inculcate their pro-reform development agenda into other officials in the agency. Consequently, the majority of officials in Kimbangwil welcomed the core policy actors’ resumption of bureaucratic leadership.

CONCLUSION Clearly, the irrigation agency’s bureaucratic identity is rooted in infrastructure-oriented development. PROSIDA, Indonesia’s first irrigation programme, formed the irrigation agency’s organizational foundation. It was based primarily on the physical development of irrigation infrastructure and continuous disbursement of foreign loans in the form of project funds. The irrigation agency directed irrigation sector development towards construction and rehabilitation of technical irrigation systems (i.e. systems with permanent dams and equipped with concrete irrigation canals and different kinds of water control and measurement

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devices). This was accomplished primarily by a series of World Bankfunded irrigation projects. As detailed in this chapter, the institutionalized corruption within the irrigation agency is a product of bureaucratic capitalism, rooted in the political party partisanship system. The practice of mass, yet systemic corruption is sustained, reproduced, and enforced by the political relationship between the president and the ministers. Politically, nonbudgetary funds are used to ensure the president’s power. In this sense, the funds are used to drive electoral support during the country’s elections and to nurture the president or the ruling party’s political constituents between elections. Administratively, non-budgetary funds act as the minister’s or the director general’s private resources to govern the decision-making process. In this context, the funds are used to sustain and strengthen the bureaucratic mechanisms, based on patriarchy: high officials in the irrigation agency trade bureaucratic positions in return for upeti delivery. As clarified in this chapter, upetism is rooted in the relationship between the project leader and the bureaucratic supervisors in and around the actual use of project funds. Rent-seeking rules within the agency were, and continue to be, crafted in the formal procedure of project fund management. The position of project leader is one of the most desirable positions in the irrigation agency: there is access to project funds and power in shaping the redistribution of these funds. How project leaders manipulate the project funds and channel money to high-level officials proves the bureaucratic conspiracy around the management of project funds. The bureaucratic reform attempted in 1999 demonstrates that any success was based on the ability of the pro-reform forces within the agency to confront the core policy actors (though the role played by mid-level officials from the NDPA in initiating the reform should not be underestimated). In the early stage of reform, the formation of Kimbangwil and the sidelining of the core policy actors into the inactive Meneg PU allowed the pro-reform officials to promote reform in irrigation. These officials played an important role in forwarding policy initiatives to the pro-reform Kimbangwil minister. However, with the re-emergence of the core policy actors in 2001, in the new Kimpraswil, the pro-reform officials were unable to counter the strong re-orientation towards infrastructure development. In the newly formed ministry, with an organizational structure almost identical to the earlier MPW, the core policy actors resumed

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their bureaucratic position and importance in directing irrigation sector development. Kimbangwil’s poor bureaucratic performance highlights a dilemma for irrigation reform in Indonesia. The core policy actors’ knowledge and experience are important assets in directing development within the sector. The main question, then, is how knowledge transfer can be promoted without accommodating the continuation of the agency’s patrimonial and corrupt bureaucratic mechanisms. An answer that suggests itself is that policy change in the irrigation sector can only take place when it is accompanied by changes in the irrigation agency’s bureaucratic identity. In turn, only by confronting the core policy actors’ interests, can the irrigation agency’s bureaucratic identity be changed. This opinion is in contrast to the general idea in policy making that assumes that an agency’s bureaucratic identity will be changed following the formulation and implementation of policy reform (cf. Mosse and Toye56 on treating bureaucracy as a neutral instrument to propose change). According to Philip Quarles van Ufford, “Bureaucracy itself is not an instrument of policy because bureaucracy is an independent generator of ideas, goals and interests” (cited in Mosse, p. 103).57 This general idea of policy making is apparent from the way international donors promoted the adoption of IMT policy in Indonesia (first under the IOMP Statement in 1987 and later under WATSAL in 1999), regardless of the irrigation agency’s opinion of the proposed policy reform. Additionally, IMT policy in Indonesia is formulated without taking into account the previous approaches to irrigation sector development in Indonesian irrigation, which is shaped by previous donor-driven irrigation policies. In the next chapter, I continue the discussion on the formulation and evolution of IMT policy in Indonesia and how the irrigation agency reshaped management transfer to fit its bureaucratic interests.

Notes  1. Paul A. Sabatier and H.C. Jenkins-Smith, Policy Change and Learning: An Advocacy Coalition Approach (Colorado: Westview Press, 1993).  2. Hans-Dieter Evers, “Bureaucratization of Southeast Asia”, Working Paper No. 71, Sociology of Development Research Centre, University of Bielefeld, 1987.

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 3. Ibid.  4. Richard Robison, “Toward a Class Analysis of the Indonesian Military Bureaucratic State”, Indonesia 25 (1978): 17–39.   5. The term bureaucratic capitalism was also used by Riggs (1966) to describe the figuration of economy, society, and politics in Southeast Asia. Fred W. Riggs, Thailand: The Modernization of a Bureaucratic Polity (Honolulu HI: East-West Center Press, 1966).  6. Ibid.  7. Karl D. Jackson and Lucian W. Pye, Political Power and Communications in Indonesia (Berkeley, CA: University of California Press, 1980).   8. See also the term “strategic group” used by Evers (1973, 1982) to describe the role of high-level officials in the government bureaucracy in shaping overall bureaucratic mechanisms. Hans-Dieter Evers, Modernization in Southeast Asia (Oxford: Oxford University Press, 1973); Hans-Dieter Evers, “Sequential Patterns of Strategic Group Formation and Political Change in Southeast Asia”, Working Paper No. 14 (Sociology of Development Research Centre, University of Bielefeld, 1982).   9. Robert Wade, “The Market for Public Office: Why the Indian State is not Better at Development”, World Development 13, no. 4 (1985): 467–97. 10. T. Jatileksono, Equity Achievement in Indonesian Rice Economy (Yogyakarta: Gadjah Mada University Press, 1987). 11. Effendi Pasandaran and Mark Rosegrant, “Irrigation Investment in Indonesia: Trend and Determinants”, Agro Economic Journal 14, no. 1 (1995): 1–17. 12. Klas Ringskog was a leading water specialist at the World Bank in Indonesia in 2001. Klas Ringskog, “Opportunity in Crisis”, Keynote Speech, International Seminar on Water Supply and Sanitation Sector Reform in the Context of Regional Autonomy, Jakarta, 21–23 May 2001. 13. William S. Cole, “Roots of Corruption in the Indonesia System of Governance an Old Game or New? Corruption in Today’s Indonesia”, Asia Program Special Report No. 100 (Washington, D.C.: Woodrow Wilson International Centre for Scholars, 2001). 14. D. Prakoso and A. Suryati, Upetisme: Ditinjau dari Undang-Undang Pemberantasan Tindak Pidana Korupsi tahun 1971 [Upetism: Reviewed from the Perspective of Corruption Law of 1971] (Jakarta: Bina Aksara, 1986). 15. W.F. Wertheim, “Sociological Aspects of Corruption in Southeast Asia”, in Political Corruption, Readings in Comparative Analysis, edited by A.J. Heidenheimer (Toronto: Holt, Rinehart and Winston, 1970). 16. Apart from this obligation, financial gains from rent-seeking practices are used primarily for private consumption (Evers 1987). Evers, “Bureaucratization of Southeast Asia”.

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17. Rudy Harahap, “Strategies for Preventing Corruption in Indonesia”, Asia Pacific School of Economics and Management Working Paper, Australian National University, 1999. 18. Wade, “The Market for Public Office”, p. 473. 19. S.H. Alatas, The Problems of Corruption (Singapore: Time Books International, 1986). 20. Wade, “The Market for Public Office”. 21. As detailed below, in 1999, the MPW was abolished and replaced by Kimbangwil. Then, in 2001, Kimbangwil was abolished and replaced by Kimpraswil, which remains the current ministry. All these ministries, no matter their title, were in charge of the irrigation agency. 22. Suara Pembaruan, “No Obligation to Deliver Upeti to High Officials”, 6 November 2003. 23. Bureaucratic patriarchy was particularly heightened within the MPW, as is discussed below. 24. Wertheim, “Sociological Aspects of Corruption in Southeast Asia”. 25. Even if employees think differently from their supervisors, they follow their supervisors’ instructions to avoid being perceived as disloyal. 26. The NDPA is a separate agency outside the irrigation agency. Its tasks are similar to the Ministry of Planning and Investment in other countries. However, after the fall of President Suharto in 1998, the NDPA was reformed and its tasks became more about planning and less about investment. 27. This position is often referred as a “wet place” (interviews with officials from the NDPA, MoHA, and Kimpraswil in 2003). Referring to the importance of water in the life cycle, a wet place connotes fertile ground. 28. Wade, “The Market for Public Office”. 29. Ibid. 30. The positions of director general and directors are mainly held by former project leaders (usually from large projects). 31. Bisnis Indonesia. “Bank Dunia dan Masyarakat Madani Siap Berantas Korupsi” [The World Bank and Civil Society Ready to Combat Corruption]. 3 September 1998. 32. The powerful role played by high-level officials in the irrigation agency in shaping the agency’s bureaucratic mechanisms is evident in its “yes sir” attitude, where officials focus their bureaucratic performance on learning different strategies to please their supervisors. In Indonesia, this attitude is abbreviated as ABS (Asal Bapak Senang; “as long as it can please the gentleman”). 33. The term service point in relation to upeti delivery came from my interviews with MoA, NDPA, and MoHA officials in 2003. 34. As a reminder from Chapter 2, the IMT under the WATSAL was a World Bankfunded project designed to transfer irrigation management from the national

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level (the ministry) to the local regional governments, and then down to the local Water Users Associations (WUAs). This transfer is discussed in detail in Chapter 4. 35. During the policy struggle over IMT, some of the soon-to-be-retired Kimbangwil officials were not granted access to Kimpraswil’s retirement clubs because they continued to promote IMT implementation, despite the demand to halt it by both the minister and the Director General of Water Resources. These clubs consist of officials from the former MPW, the former State Ministry of Public Works (also known as Meneg PU, which is discussed in this chapter), and Kimpraswil. In most cases, such a club is established formally within the organizational structure of the irrigation agency. However, in some cases, it might also be established as an NGO. In the latter case, club membership is not limited to officials from the irrigation agency. 36. The echelon system originated from the military organizational system and was first applied by Suharto’s New Order government. It emphasizes the importance of bureaucratic hierarchy in government ministry. Officially, interministerial interaction should only take place between officials from the same echelon. 37. Max Weber, Law in Economy and Society, translated by Edward Shils and Max Rheinstein (New York: Simon and Schuster, 1921). 38. A project leader’s access to project funds can indirectly make the leader a powerful actor in the irrigation agency. In some cases, large project funds could make the leader so powerful that the associated bureaucratic power is greater than that of the minister’s. 39. Non-budgetary funds from project “benefits” are directly channelled to a specific bank account. In some cases, a project leader even channels the “benefits” in cash, carrying all the money in a suitcase (interview with officials from the MoHA in 2003). 40. The degree of mark-up allowed by a project leader is defined by the power of his or her supervisor within the irrigation agency. The degree of mark-up accepted reflects a confidence that nobody will challenge this power. 41. The IOMP 1987 Statement was a policy agreement between the Government of Indonesia (specifically with the irrigation agency) and the World Bank. 42. This lack of interest was made clear when the irrigation agency transformed IMT implementation under the IOMP 1987 Statement into an infrastructureoriented programme. 43. World Bank, Combating Corruption in Indonesia: Enhancing Accountability for Development (Washington, D.C.: World Bank, 2003). 44. Before joining the government, Witoelar led the Indonesian Consumer Foundation and founded and led both the Indonesia Forum for the Environment and Friends of the Environment Fund. Though resigning from her ministerial

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post in 2001, she continues to be involved as a board member of several civil society organizations, both at national and international levels. She chairs the Foundation for Local Governance Innovation and serves as advisor to both the Indonesian Association of Municipalities and the Association of Districts. 45. The way the selection procedure was conducted — through general examinations — implied these officials’ technical capability. However, the selection process was also defined by their relationships with high-level officials from the former MPW. 46. The core policy actors from the former MPW resisted Kimbangwil’s formation. This resistance was apparent during the early stages, when they (and MoA officials) proposed incorporating the position of MPW’s Director General of Irrigation into the organizational structure of the MoA, instead of into Kimbangwil. Later, this proposal was accepted by President Wahid and legally supported by the promulgation of a presidential decree. However, due to unknown reasons, the incorporation of this position into the MoA was cancelled at the last minute. 47. According to my interviewees, the formation of Meneg PU was tolerated within Kimbangwil simply to smooth the bureaucratic restructuring of the MPW (interviews with NDPA and MoHA officials, 2003). 48. This policy formulation “linking” to the directorate of irrigation’s activity in Kimbangwil was never made clear. 49. The abolition of this unit represented the reform group’s attempt to change the irrigation agency’s bureaucratic identity. 50. Morten Egeberg, “The Impact of Bureaucratic Structure on Policy Making”, Public Administration 77, no. 1 (1999): 155–70. 51. However, the two remaining directorate generals were given different titles. The Directorate General of Road Infrastructure (in the MPW) was replaced by the Directorate General of Regional Infrastructure Development (in Kimbangwil). The Directorate General of Housing (in the MPW) was replaced by the Directorate General of Housing Development (in Kimbangwil). 52. These key policy-makers included mid-level officials from the NDPA. 53. Persistent upetism practices proved that bureaucratic mechanisms within the irrigation agency were governed by its bureaucratic self-interest, and not by its belief system (Sabatier and Jenkins-Smiths 1994). Sabatier and Jenkins-Smiths, Policy Change and Learning. 54. With the change in power, the core policy actors stopped the development fund that channelled IMT implementation to the regional levels. 55. In Kimpraswil, the Directorate Generals of Rural Development and of Urban Development had been merged into one directorate general, and the Directorate General of Spatial Planning and Regional Development was renamed the Directorate General of Spatial Planning.

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56. David Mosse, Cultivating Development: An Ethnography of Aid Policy and Practice (London: Pluto Press, 2005); John Toye, “Political Economy and the Analysis of Indian Development”, Modern Asian Studies 2, no. 2 (1998): 97–122. 57. Mosse, Cultivating Development.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

4 IMT IN INDONESIA: A CHANGING POLICY GAME

INTRODUCTION This chapter presents the controversy1 over Irrigation Management Transfer (IMT) policy, as defined under the Water Sector Adjustment Loan (WATSAL), and how the policy conflicted with the bureaucratic identity of the Indonesian irrigation agency (at the time, under the Ministry of Public Works [MPW]). This conflict brings into light the antagonistic relationship between IMT policy and the very agency responsible for its implementation. With IMT renewal in 1999, pro-reform government officials in the newly formed Ministry of Settlement and Regional Development (Kimbangwil) attempted to remove the very foundation upon which the agency’s existence and survival was based; that is, infrastructure-oriented development and its institutionalized rent-seeking practices. These proreform government officials consisted primarily of mid-level officials from the National Development Planning Agency (NDPA),2 mid-level officials from Ministry of Home Affairs (MoHA), and of course, Kimbangwil itself. Taking the evolution of IMT policy in Indonesia as my case study, I argue that as long as the irrigation agency’s core actors remained antagonistic

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towards the IMT policy, the policy would continue to be contested with the irrigation agency. This chapter broadly discusses the assumptions of and the rationale behind IMT policy formulation worldwide and specifically its implications for implementation in Indonesia. It starts with a critical analysis of IMT policy as defined by international donors and policy-makers (Section I) and highlights the gap in the current discourse on IMT policy (Section II). It then gives an overview of the IMT policy evolution in Indonesia and how the irrigation agency first shaped IMT implementation under the Irrigation Operation and Maintenance Project (IOMP) 1987 Statement (Section III). The chapter moves on to discuss the role the 1998 political upheaval played in accelerating the speed of irrigation sector reform, with my analysis focused primarily on the legal framework of the WATSAL IMT programme (Section IV). I then present the formal decision-making structure in WATSAL (Section V) and analyse how the WATSAL policy-makers strategically planned Water Users Association (WUA) empowerment in an attempt to eliminate institutionalized corruption within the irrigation agency (Section VI). The implementation set-up for the WATSAL IMT programme in 1999 is described in section VII.

SECTION I: ASSUMPTIONS VERSUS REASONS IN SHAPING IMT POLICY International policy-makers believed that, IMT, would solve the management problems in the government irrigation system once decisionmaking authority for systems management was transferred from the inefficient irrigation agency to the newly formed water users associations (both Federations of Water Users Association (FWUA) and WUA).3 Among the problems to be solved were the following: the high operational cost of government irrigation systems, the rapid deterioration of the irrigation infrastructure, the deferred maintenance attitude, inefficient water use, and unequal water distribution. Similarly, international donors and policy-makers thought that IMT could redirect the irrigation policies from infrastructure-oriented to farmers-focused development. Central to this line of thinking was that policy-makers assumed the relationship between the irrigation agency and farmers in IMT to be neutral and apolitical. Hence, the thinking was that the newly created WUAs and

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FWUAs would be empowered by the very institution these organizations were formed to replace. In Indonesia, prior to WATSAL, the irrigation agency was the only government agency assigned to implement IMT. International policy-makers assumed either that the irrigation agency was willing to, or that it could be forced to make changes in its organizational functioning, following IMT policy adoption. This assumption can be seen in the titles the international donors and policy-makers planned for the different new roles to be played by the irrigation agency — basin manager, regulator, policy maker, and so on — post-IMT.4 In reality, management transfer was characterized by power struggles between the irrigation agency, as the existing power holder, and the FWUAs and WUAs, as the designated future decision makers in irrigation systems management. The irrigation agency was not always convinced about its new role or even about the need for management transfer, so it never seriously engaged in redefining itself. The agency’s overall resistance to IMT can be observed in the way it transformed the IMT policy under the IOMP 1987 Statement into a construction programme5 and even under WATSAL in 1999, the agency advocated for keeping construction and rehabilitation as part of the project activities.6 However, negativity was camouflaged7 by the agency’s formal acceptance of all proposed changes, which was done only to accept the loan agreements between the agency and the donors.8 The irrigation agency’s resistance to change never translated into a revision of the policy concept in IMT. Aside from assuming that the farmer–agency relationship would be simple, IMT policy-makers assumed two other factors: the farmers were well represented within the FWUAs and WUAs, and they were willing and prepared to take over systems management.9 In reality, the FWUAs and WUAs were often dominated by rural elite.10 In Indonesia, right from their formation, FWUAs and WUAs were designed towards representing the elites interests, not necessarily towards meeting farmers needs. Farmers’ opinions of these organizations or how they viewed the idea of IMT in general remained opaque.

SECTION II: RESEARCHING IMT PARADIGMS The current research on IMT rarely discusses the basic assumption in IMT policy formulation. Additionally, state-centred studies11 on IMT hardly ever link an irrigation agency’s organizational characteristics, or even its

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actual functioning, with the basic policy assumptions of IMT. I argue that IMT policy failure is partially rooted in the paradoxical policy assumption that an unreformed, corrupt, and inefficient irrigation agency can reform itself and develop high-performance farmer organizations. Much of the research on IMT approaches such policies from either the neo-liberal12 or the neo-institutionalist perspective.13 From the neo-liberal perspective, IMT policy is studied in relation to the more general economic problems of the poor performance of government-managed irrigation systems and the high costs to manage these systems, and thus the need for cost recovery. Some examples of this neo-liberal perspective include studies on irrigation services,14 and critical analysis of the financial autonomy of the irrigation sector and of privatization.15 Within this perspective, the fiscal inefficiency of the irrigation agency is viewed as the main obstacle to improving system performance.16 Similarly, literature on IMT from the neo-institutionalist perspective tends to promote the idea of farmer participation and facilitation,17 though how farmers actually perceive their involvement in irrigation management is seldom discussed. Trapped in the assumption that farmers’ development needs will be incorporated into IMT, existing research on IMT has failed to study farmers’ actual needs outside the context of IMT. In addition, research on IMT seldom addresses the different types of elite-farmer relationships, or how farmer representation could be increased or manoeuvred through this relationship. Both these perspectives have roots in a strong social engineering approach.18 Assuming that new institutions can be created without the influence of the existing institutions, analyses on IMT often ignores the power struggles that shape the actual transfer process. IMT policy is studied primarily in relation to the crafting of the new irrigation organizations (consisting of farmers and other water users), that, with properly designed rules and regulations, is expected to function better than the irrigation agency.19 Emphasis is incorrectly placed on studying the policy input–output relationships, rather than on studying the mechanisms of institutional change. Research on IMT has focused on mapping the management of the FWUAs and WUAs, such as their organizational capabilities (using indicators such as their irrigation service fee [ISF] collection rates, irrigation intensity, physical condition of the irrigation infrastructures, cost of irrigation, and maintenance expenditures); their development potential;

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their responsiveness towards policy intervention by the government; and their ability to manage physical problems occurring in the field.20 In practice, although understanding the organizational development of the FWUAs and WUAs is essential in measuring the actual progress of IMT, this collected data do not necessarily measure farmers’ needs in the irrigation system. Similarly, such documentation on the FWUAs and WUAs cannot explain the reasons behind any (un)changing situations or how IMT implementation may be shaped by farmers and the irrigation agency. Furthermore, research on IMT has been focused on efforts to deal with or remove the barriers to IMT implementation and/or finding the key elements for successful implementation.21 The barriers are the lack of coordination between the implementing agencies; the poor performance of these agencies; unreliable fund disbursement for IMT implementation; the FWUAs’ inability to fulfil their new role in systems management; and the irrigation agency’s unwillingness to transfer irrigation management.22 Removing these barriers was eventually presented as a precondition and requirement for IMT policy implementation. The key elements for successful implementation are the following: a clear differentiation of tasks between the various government agencies and farmers, the creation of legal backup, good condition of irrigation physical irrigation infrastructures, and support from within the government.23 What all this adds up to is that politics was, and remains, deeply intertwined at all levels of water policy reform. According to Mollinga and Bolding, though, “the word ‘politics’ is virtually absent in the formal policy discourse on irrigation reform”.24 The fact that the politics of IMT is rarely acknowledged, however, does not mean that the actors are unaware of it. In Indonesia, the politics of IMT often are simply discussed informally, by high-level government officials, behind closed doors. Starting around 2003, the politics of IMT has become more widely acknowledged.25 For example, in 2004, the World Water Council organized a meeting on water and politics to raise awareness of the importance of the political issues in water policy reforms. During the same year, the Stockholm International Water Institute established a special programme to fight water sector corruption, and the World Bank initiated a special programme on governance and anti-corruption measures. Nevertheless, open discussion on the issues remains limited to international seminars or workshops, usually arranged by the international agencies, involving national policy actors from the developing countries.

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Thus, an understanding of an irrigation agency’s bureaucratic mechanisms and its role in shaping and implementing IMT policy has remained largely absent in IMT policy research, despite the important role played by an irrigation agency in directing actual policy implementation. For example, Bruns (2003) and Bruns and Atmanto (1992)26 show how Indonesia’s irrigation agency resisted IMT policy starting with the IOMP 1987 Statement. However, what remains unexplained is how this resistance is linked to the agency’s bureaucratic identity. My research is designed to explain this underlying resistance. Beginning with the concept that the prime motive of the irrigation agency and its mother ministry is to protect its power, I investigate how IMT policy is channelled from national to the regional levels, and from the regional down to field (farmer) level. This channelling is contextualized by linking the entire process, from IMT policy making at the ministries to IMT implementation, specifically in the seven technical irrigation systems located in Kulon Progo district, Yogyakarta.27 Kloezen defines policy as: “a planned impetus, energizer or reflection of constructed and coordinated (induced) change in order to control the production, distribution and use of irrigation resources” (p. 7).28 I define IMT policy making as an ongoing negotiation process, in which past policies are simply reshaped by the socio-economic and political relationships among the international and national organizations that formulate and implement irrigation reforms. This challenges the linear conception in policy making, which is that the national government acts unilaterally in implementing policies of the international organizations.29 It emphasizes that policy has more to do with action than with rhetoric.30

SECTION III: THE EVOLUTION OF IMT POLICY: A HISTORICAL PERSPECTIVE In Indonesia, IMT 31 policy has been repeatedly formulated and implemented without significant change in the farmers–irrigation agency relationship.32 In the formulation of the IOMP in 1987, farmers’ involvement in systems management remained limited to the tertiary level. Even with the formulation of the WATSAL in 1999, which is generally considered to be the most far-reaching reform package to date, the irrigation agency remains officially in charge of the overall system operation and maintenance (O&M). In addition, under WATSAL, the

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FWUA’s organizational development was to mimic that of the irrigation agency. The idea of starting anew from the perspective of international policy-makers was to change farmer–irrigation agency relationship; clearly, this had limited the scope in the written policy.

A Comparative Overview In Indonesia, IMT policy was first adopted under the IOMP 1987 Statement and was formulated primarily as part of a policy agreement between the irrigation agency (at the time, under the MPW) and international donors, in this case, the World Bank. The agreement entailed that the irrigation agency would adopt and implement IMT accordingly, with financial support from the bank. However, apart from this policy agreement, the Indonesian government did not issue any legal regulations for implementing IMT. In 1999, conditioned by the country’s political upheaval, IMT policy was reformulated under the World Bank–funded WATSAL. Under WATSAL, IMT policy was focused on the formulation of its legal framework. Another important change during this period was that the powerful MPW was eliminated and Kimbangwil was created to replace it. A major difference between IMT under the IOMP Statement and under WATSAL lies in the way the farmers’ role was projected. Under the IOMP Statement, farmer participation in the irrigation sector was focused on contributions (namely labour and material) for construction activities and for collection of ISF. Under the WATSAL, farmers’ involvement was geared towards empowerment, primarily by giving the WUAs33 direct access to manage O&M funds. Incorporating IMT policy into the regional autonomy programme, under WATSAL, implied widespread policy implementation throughout Indonesia. Unlike before, the WATSAL IMT programme was to be applied to all irrigation systems, regardless of size, technical characteristics, or location. And unlike before, under WATSAL, two important changes occurred: management transfer was not limited to the tertiary and secondary levels34 of the irrigation systems, and the formulation of the IMT legal framework was directed through an interministerial decision-making platform under the leadership of the NDPA. This sharing of policy making between Kimbangwil and the NDPA was a new step for the ministry, as the MPW had always acted alone.

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Table 4.1 provides an overview of IMT policy evolution in Indonesia from the IOMP 1987 Statement to its policy renewal under WATSAL in 1999, and Table 4.2 provides an overview comparison of the policy elements of IMT under IOMP 1987 Statement and under WATSAL 1999. Figure 4.1 presents the timeline of IMT development in Indonesia.

IMT under the IOMP 1987 Statement: A Policy Tool for Funds Mobilization Under the IOMP Statement, the irrigation agency (under the MPW) viewed IMT as a policy tool to mobilize development funds.35 To receive additional loan-funded projects, the agency agreed to adopt IMT as part of the donors’ preconditions. The irrigation agency accepted this agreement because it needed the funds to meet its own O&M costs, not because it believed in the importance of farmer involvement in irrigation systems management. The economic motive in IMT adoption is evident in the following 1987 policy statements detailing needed changes in the regions’ ability to support its own irrigation needs: The government will rationalize expenditure programs in the irrigation subsector, and formulate and implement a more realistic irrigation investment strategy for the fifth five-year development plan. (IOMP 1987 Statement, Policy Statement Number 6) It is necessary to mobilize new sources other than the present Central Government allocation, in the efforts to increase the O&M budget and eventually to reduce dependence upon Central Government budgetary support, from the beneficiaries of irrigation development in the form of an “Irrigation Service Fee”, which again should be related to the quality of service provided. (IOMP Statement of 1987, Background Point Number 5)

It is apparent in Soenarno’s36 review paper that under the IOMP Statement, IMT was adopted to balance irrigation management budget to expenditures (particularly through O&M budget restructuring). In 1987, Soenarno was the director of the irrigation agency and one of the leading policy actors in formulating the IOMP 1987 Statement. He argued that the adoption of IMT policy was impelled by regional governments’ inability to provide sufficient funds for systems O&M.

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Remarks In 1998, mid-level, pro-reform government officials in the National Development Planning Agency (NDPA) used the fiscal crisis and political reform in the country as their entry point to initiate sectoral reform Infrastructure-oriented irrigation development is preserved Cost recovery path in IMT links IMT under IOMP and the WATSAL IMT programme In WATSAL, the decision-making domain is shifted from a sectoral irrigation agency to an inter-sectoral platform under the leadership of the NDPA Under WATSAL, the pro-reform government officials’ efforts to counteract the irrigation agency’s rentseeking attitude are focused on the shifted access of development funds from the agency to WUA WUA’s role changes from government’s recipients to government’s grass-roots weaponry

WATSAL 1999 — Fiscal crisis in late 1997 — Political reform that led to the formulation of regional autonomy

Deferred maintenance Cost recovery through farmer empowerment Bureaucratic rent-seeking in government-managed irrigation systems (as defined by the pro-reform government officials in the NDPA) From the pro-reform government officials’ perspective: — With IMT, WUAs’ empowerment is used to counteract bureaucratic rentseeking — Fiscal decentralization to facilitate sectoral reform — IMT as part of wider political reform in the context of regional autonomy — Farmer empowerment as a strategy to eradicate bureaucratic rent-seeking

Deferred maintenance

Cost recovery to meet O&M costs

Lack of development funds for system rehabilitation and construction (as defined by the irrigation agency)

From the irrigation agency’s perspective: — IMT was adopted primarily to secure funds flow into the irrigation agency, and preserve infrastructureoriented irrigation development

— IMT as part of O&M programme — Farmer participation as a strategy for systems cost recovery

Formal problem definition in IMT:

Policy reasoning in IMT:

Informal problem definition in IMT:

Hidden policy agenda:

Policy characteristics:

IOMP 1987 Statement

Forces behind IMT Foreign donors’ changing investment policy formulation: pattern

TABLE 4.1 Evolution of IMT Policy in Indonesia

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— WUA formation — Participatory design and construction — ISF collection

Limited to the tertiary level (during ISSP I and II), and later tested at secondary level (during JIWMP)

Limited to irrigation systems smaller than 500 hectares, located in the pilot sites

As government instrument to improve system cost recovery

— ISF collection — Participatory design and construction

Focus in IMF:

Degree of transfer:

Scope of IMT implementation:

The role of farmers/ WUAs as projected in IMT:

WUAs main activities:

The principle of one irrigation system — one management

The role of WUAs as the main agent in the proposed fiscal decentralization, as indirect counterforce against the present centralized funding mechanisms

Kabupaten Irrigation Improvement Fund (KIIF) as additional shortcut in development funds disbursement

— Decentralization of authority to district level. IMT as sectoral reform, part of regional autonomy — MoHA’s increased bureaucratic power in the irrigation sector, as IMT implementing agent

New policy element

WUAs is equipped with decision-making authority

— ISF collection — WUAs are authorized to manage ISF — WUAs have access to propose the — O&M training — Participatory design and construction allocation of development funds — Organizational training (administrative and financial) — Develop proposal for development funds

As government’s agent for reform

Widespread, based mainly on district Sectoral reform as part of regional government’s willingness to implement IMT autonomy

Flexible, up to system level

— Actual management transfer — WUA’s role in system O&M, through its direct access to O&M funds

Directly to district government

Centralized

Development funds channeling:

WATSAL 1999 National irrigation agency and MoHA together with district irrigation agency, which acts under the authority of district government

Implementing agent: National irrigation agency and its representatives at provincial level (Kimbangwil or regional offices)

IOMP 1987 Statement

TABLE 4.2 Comparison of Policy Elements of IMT under the IOMP 1987 Statement and WATSAL of 1999 IMT in Indonesia

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FIGURE 4.1 Timeline of IMT in Indonesia

1994

1984

Self-sufficient in rice

Follow-up on seminar Inter-sectoral decision making platform

1995

1985 Fiscal crisis

1996

1986

Suharto’s fall

7 field laboratories WATSAL formulation Regional autonomy

enlarged

1998

1988

Presidential decree Letter of Sector Policy Reorganization MPW

1999

1989

ISSP I IMT < 150 ha IMT < 500 ha

IWMI suspended

Fiscal crisis

1998

1997

JIWMP-IDTO

1987

IMT adoption under IOMP

Political turmoil

WATSAL organizational structure

1999

2001

IMT working groups MoHA workshop

Government regulation Kimpraswil decree MoHA decree

2002

1992

Kimpraswil withdraws 2003

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2000

1991

ISSP II IMT < 500 ha

Cisarua seminar

JIWMP-IDTO JIWMP-IWIRIP / IDTO-PIA / NewISF (WATSAL)

1990

First turnover West-Java & West Sumatra

MoHA & MoF decrees

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IMT adoption under the IOMP was conditioned by bureaucratic uncertainties inside the irrigation agency at that time, uncertainties that began shortly after Indonesia achieved self-sufficiency in rice production in 1984. This achievement legitimated the importance of improved irrigation systems for the country’s farmers (especially in the green revolution era), but it also put into question the role of the irrigation agency. Continuing increases in rice production would have to come through increases in cropping or irrigation intensity, increases that depended more on improvements in water management than on infrastructure projects. Many in the agency believed that the country’s food self-sufficiency would have direct implications for the agency’s strong focus towards infrastructure development, thereby affecting the agency’s identity. It is for this reason, as stated by Bryan Bruns: “The formulation of the IOMP 1987 Statement was conducted as a secret (confidential) process between government and major donors, without public consultation and with little publicity”.37 In the context of the IOMP 1987 Statement, over a period of 15 years (1987–2002), all irrigation systems smaller than 500 hectares were supposed to be gradually turned over to the WUAs for their management. Implementation began in 1987 with pilot turnover projects in West Java and West Sumatra. The initial emphasis was on systems smaller than 150 hectares.38 Prior to turnover to the WUAs, “systems rehabilitation” was re-termed “special maintenance”39 (Bruns and Atmanto 1992). 40 This special maintenance was supposedly to ensure effective water delivery and adequate preventive maintenance after the turnover.

From Cost Recovery to Construction Programme In reality, the irrigation agency transformed IMT under the IOMP 1987 Statement into a central government-run infrastructure-based programme, concentrating on construction and rehabilitation of irrigation systems. It shifted the emphasis from turnover to the WUAs to construction works by strategically redefining the systems classification for turnover.41 Based on the legally defined system classification, construction work was to be done only on irrigation systems that (1) had government-built infrastructure, and (2) needed physical improvement before turnover. Systems with no government-built infrastructure (such as earthen dams) or systems with government-built infrastructure that had already been improved were supposed to be immediately turned over, once the organizational

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structure of the relevant WUA was established. However, irrigation officials argued that systems that had never received assistance were often in a worse condition than those with government-built infrastructure that still needed some improvement. As Bruns stated: “Aiding schemes [systems] that already had more elaborate infrastructure, while ignoring those with fewer permanent structures of stone and concrete, was portrayed as unfair” (p. 150).42 On the basis of these arguments, both the irrigation agency and its donors agreed that improvements would be undertaken where it was considered necessary. Following this agreement, the irrigation agency conducted several assessments to define the degree of physical improvement for each system category. Unsurprisingly, the assessments revealed that construction was required for all systems. In turn, most of the project funds were spent on these “special maintenance” activities.43 World Bank officials supervising the project acquiesced to these payments, seeming to feel it was beyond their ability to change the agency’s assessments.44 This rerouting towards infrastructure programmes rather than water management was made possible by the existing centralized funding mechanisms. The irrigation agency was fully in charge of focusing on construction and rehabilitation activities, as development funds continued to be disbursed top-down. According to Bruns,“the participatory reforms initiated in 1987 offered Indonesian farmers greater voice in irrigation management, but little choice to exit from the dominant patterns of agency-controlled development in irrigation” (p. 146).45 Put another way, though IMT gave the WUAs greater access to decision-making processes, decision-making authority remained within the irrigation agency. The WUAs’ organizational development was limited to the central governmentdefined framework that focused on participatory design and construction of the irrigation infrastructure, but even within this limited development choice, the WUAs did not have any power to influence the actual design or construction. For example, though farmers were consulted during the design phase, construction often proceeded without taking their needs and preferences into account.46 At the implementation level, the IOMP was enacted through projects, which is how the donor-funded policy programme materialized into different activities. The IOMP implementation was divided into two periods (from 1987 to 1991 and from 1991 to 1995) and under two different projects. The first project, the Irrigation Sub-Sector Project (ISSP I) covered pilot activities for turnover to the WUAs and for ISF collection. In practice, it

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was only in 1990, three years after IMT policy formulation, that the first systems in West Java and West Sumatra were turned over to the WUAs. In addition, the Ministry of Agriculture (MoA) and the MoHA were involved in water project activities by coordinating the WUA members’ training and coordinating ISF collection, respectively. Based on the slow turnover to the WUAs, in 1989 the World Bank requested the International Irrigation Management Institute (IIMI) to reframe the IMT policy. The reframing resulted in the IIMI’s suspension from Indonesia. Though no formal reason was ever stated with regard to its suspension, there was a strong indication from policy actors that it was related to IIMI’s proposal to use the sectoral development fund to finance other activities, not just infrastructure-oriented development activities. Although the suspension did not address World Bank’s concerns about IOMP outcomes, it also did not postpone continuation of policy implementation under ISSP I or prevent its extension into ISSP II. The turnover programme slowly spread to other provinces in Indonesia during the ISSP II, with most of the attention on Java, where the majority of the small-scale irrigation systems are located. However, it was also during ISSP II that IMT was directed more and more towards construction and rehabilitation activities, not water management. The slow pace of turnover to the WUAs and the limited collection of ISF during ISSP I and ISSP II47 indicates the irrigation agency’s determined resistance to implementing IMT. The delay in IMT implementation reflects both the agency’s antagonistic relationship with IMT, as well as the overall political dislike on the part of government agencies to decentralize governance power. When ISSP II came to an end in 1995, other programmes from 1995 to 2000 were started under the World Bank–financed Java Irrigation and Water Resources Management Project (JIWMP), which was part of the World Bank’s Irrigation Development Turnover (IDTO) unit. IMT implementation was continued in pilot projects in the four provinces in Java (West Java, Central Java, East Java, and Yogyakarta). Though IMT under the JIWMP– IDTO still referred to the IOMP 1987 Statement, it is unclear how these pilot projects were linked to the previous implementation of IMT under ISSP I and ISSP II. During the JIWMP-IDTO period, the irrigation agency manoeuvred that construction improvements were to be included in the turnover programme and that the overall project would have sufficient funds for rehabilitating and upgrading targeted irrigation systems larger

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than 500 hectares. However, turnover became its own development target during JIWMP–IDTO period, as the problem of a growing backlog of small rehabilitated — but not yet transferred — irrigation systems became apparent. In 1997, after ten years of implementation, only 420,000 hectares of small-scale irrigation systems had been officially turned over to the WUAs.48 This was only 47 per cent of the 900,000 hectares targeted for turnover by 2003.49 Most irrigation systems smaller than 150 hectares were already farmer managed, even prior to IMT. In practice, just like in ISSP I and ISSP II, the irrigation agency had managed to focus JIWMP–IDTO’s activities on physical improvements, not on water management or turnover to the WUAs.50

Analysis of IMT under the IOMP 1987 Statement The stark contrast in how IMT policy was perceived by the donors and by the irrigation agency reveals the conflict between IMT policy and the bureaucratic identity of the agency. For example, the IMT policy objective to improve the poor performance of government irrigation systems conflicted with the agency’s interest in preserving the vicious cycle of bad construction–deferred maintenance–rehabilitation. Preserving this vicious cycle was crucial for maintaining institutionalized rent-seeking practice and the agency’s identity. Similarly, the IMT policy of promoting farmers’ decision-making authority in systems management conflicted with the agency’s interest in sustaining its bureaucratic power; for example, funded attempts to increase the WUAs’ self-reliance were at odds with the irrigation agency’s interest in preserving farmers’ dependency. IMT’s conflicts with the agency’s interest is evident in the “cyclical relationship of codependency”, in which farmers relied on government subsidies, while the agency “relied” on infrastructure deterioration to justify rehabilitation projects.51 Here, IMT served more to reinforce the dependency of farmers on the government than to engender self-reliance. For instance, findings from the study conducted by the International Water Management Institute (IWMI) and Gadjah Mada University indicate that the conventional pattern of farmers deferring maintenance costs until the government returns with financial assistance for rehabilitation has not been changed by turnover to the WUAs.52 The WUA leaders interviewed in all four provinces reported to researchers that they expected the government would return within five years to finance another rehabilitation of their systems.

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In the IOMP 1987 Statement, formation of the WUA organization became part of the mainstream financial strategy to reduce central government expenditure in the irrigation sector. However, despite the desire for irrigation systems cost recovery, in practice, the turnover programme had no significant effect on government expenditure or on how the development funds were disbursed. Reviewing the outcomes and impacts of IMT policy implementation at the field level, the study conducted by the IWMI and Gadjah Mada University showed that there was no significant change in systems management (O&M practices) after systems turnover, either.53 One important finding that emerged was that, even prior to turnover, farmers were already performing a majority of the water management tasks. Hence, for most systems, turnover did not constitute a major change in actual management practices.54 In addition, the WUAs’ mixed results with regard to their role in water distribution, in particular, and in irrigation management, in general, show that there was no direct link between formation of the WUAs and actual system performance.

SECTION IV: IMT UNDER WATSAL This section begins with a discussion of the reintroduction of IMT policy in 1999 (under the newly formed Kimbangwil), which was followed by the passage of Presidential Instruction Number 3 of 1999 as the legal policy for the WATSAL IMT programme, and it ends with an analysis of this policy agreement between the Government of Indonesia (GOI) and World Bank, as stated in the Letter of Sector Policy (LoSP).

IMT Policy Reintroduced Late in 1997, a fiscal crisis hit Indonesia.55 The subsequent political upheaval triggered political and economic reform, directly leading to the May 1998 downfall of Suharto’s thirty-two years old regime.56 This political reform gave the momentum for the reformulation of IMT policy, under the overall concept of regional autonomy. The passage of the Regional Autonomy Act of 1999 accelerated the process of reform in the irrigation sector. The crisis left government ministries with insufficient development budgets or funding to support staff salaries, so the pro-reform government officials in the NDPA approached World Bank officials in Indonesia to use this opportunity to introduce its reform agenda for the water sector, in

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general, and for the irrigation sector, in particular (interviews with midlevel officials from the NDPA and with World Bank officials in Indonesia, 2003, 2004). These pro-reform government officials57 used the recent political reform and financial crisis as the counterforce against the constructionbased interests of the irrigation agency. In 1998, the World Bank proposed an Agricultural Sector Adjustment Loan (ASAL), with the irrigation agency incorporated into it. However, due to a lack of support from the MoA, ASAL was altered58 into the WATSAL in October 1998. Programme wise, WATSAL did not differ much from ASAL, as both loans linked irrigation and agricultural development as part of overall water sector reform. WATSAL formulation in 1999 by both the GOI and the World Bank marked the reintroduction of IMT policy as part of the country’s political reform. In addition, the World Bank organized water sector donors to ensure acceptance of and support for WATSAL. These donors included the Asian Development Bank, the European Union, Japan International Cooperation Agency, and the Food and Agriculture Organization. The incorporation of IMT policy reformulation into the wider context of Indonesia’s 1998 political reform silenced any possible counterforce from the irrigation agency. In the context of the country’s political transformation, IMT policy was recognized as one part of the larger government overhaul. With reference to the Regional Autonomy Act, the decision to implement IMT policy was transferred to the regional governments. Theoretically, the irrigation agency’s bureaucratic power would be impaired by this transfer of authority, as it would completely remove the line of command from the irrigation agency. Obviously, the irrigation agency had more than enough reasons to resist the proposed reform. Surprisingly, resistance was not evident at this early stage, perhaps because of the ongoing economic crisis and political turmoil, people’s demands for political reform and decentralization in all sectors of development were powerful. Furthermore, as the MPW was being dissolved59 at the very moment, the move to regional autonomy was strongest, and this did not leave the core MPW policy actors with much choice but to wait for a more opportune time to react.

The Renewal On the basis of the 1998 decree of People General Assembly,60 prominent irrigation scientists61 from three different universities in Indonesia (the

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universities of Gadjah Mada, Andalas, and Padjajaran) conceptualized the official mandate of the WATSAL IMT programme that was in the Presidential Instruction Number 3 of 1999 (Inpres 3/99). At this early stage of reform, in the absence of any other legal regulations, Inpres 3/99 acted as the main legal authority behind the WATSAL IMT programme, and it thus powered the proposed political sectoral reform. Inpres 3/99 was issued shortly after President Abdurrachman Wahid reintroduced the concept of IMT in a nation-wide workshop of vice governors on 13 April 1999. According to the Inpres 3/99, the WATSAL IMT programme was to focus on the following elements: • Redefinition of tasks and responsibilities in irrigation towards greater involvement of farmers in the decision-making process. • Farmer empowerment through the formation of the WUAs. • Gradual, selective, and democratic transfer of irrigation systems management to the WUAs. • ISF collection by the WUAs to finance systems O&M and rehabilitation of irrigation infrastructure. • Sustainable irrigation development to consolidate land use for agriculture. In 1999, the WUAs’ involvement in systems management was extended from the tertiary level up to the main system level via the introduction of the one irrigation system–one management principle. Arranging the transfer of irrigation management in a phased, selective and democratic manner to WUAs according to the principle of one irrigation system–one management. (Inpres 3/99, Third Policy Element)

The principle opened the possibility for all irrigation systems to undergo management transfer. In the WATSAL IMT programme, the requirement for management transfer was to be independent of system size, location, or the system’s infrastructure condition. However, how the one irrigation system–one management principle was to be linked to the process of management transfer, to be conducted in a “phased, selective, and democratic manner”, was left unclear. For instance, use of the word democratic62 implied that farmers could decide individually whether to adopt and implement IMT, but it is unclear how this decision related to “phased” and “selective”.

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The WATSAL IMT programme placed greater emphasis on farmers’ decision-making authority. Unlike in the IOMP, where the WUAs were perceived as irrigation beneficiaries, in Inpres 3/99, the WUAs were projected as decision makers: Empowering the farmer community … through development of WUAs which are autonomous, self-reliant, and rooted in the community, … and facilitating and providing opportunities for the farming community to democratically form economic and business units with legal status at the level of farming enterprises. [Inpres 3/99, Policy Statement Number 1 [on tasks redefinition])

The word “empowering” implies a more political understanding of WUA organizational development. It refers to the concept of governance that emerged in the global policy circle in the late 1990s.63 This is in contrast to the way the farmer participation concept was applied within the neoliberal development perspective under the IOMP. However, the WUAs’ new role in systems management was not linked to the redefinition of roles, duties, and responsibilities of the irrigation agency. On the contrary, the redefinition of tasks and responsibilities of the irrigation agency mainly referred to the respective administrative levels (national, provincial, and district). Rearrange duties and responsibilities of irrigation management institutions by giving a larger role to the farming community as decision makers in management of irrigation systems which are their responsibility. (Inpres 3/99, First Policy Element) Explanation of the First Policy Element: In order to implement irrigation activities more effectively and efficiently, the GOI will rearrange and redefine tasks and responsibilities of irrigation management institutions at national, provincial and district level, down to farmers’ level, with WUAs as the decision maker in management of irrigation systems which are their responsibility.

In addition, the reformulation of IMT policy in 1999 still involved the transfer of both management and funding. The cost recovery aspect is apparent in the fourth policy element, where the WUAs’ role in revenue collection was highlighted. [M]anagement and funding will be carried out jointly between the government and WUAs by means of joint management until management

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and funding can be fully transferred to WUAs (Inpres 3/99, Third Policy Element). Explanation of the Third Policy Element: GOI would hand over the management (O&M) and the financial cost of systems management to WUA.

Policy Reform by Foreign Loans An LoSP was formulated only two weeks after the Inpres 3/99 was issued in April 1999. The letter served as the formal loan agreement between the GOI and the World Bank with regard to the proposed water sector reform under WATSAL. While the LoSP referred to the broader water sector reform in Indonesia, I focus my analysis on the letter’s importance for the policy reform in the irrigation sector. According to the loan agreement, over a period of five years, WATSAL was to be divided into three financial tranches. After its third split, the GOI was to be given a five-year grace period, followed by a ten-year repayment plan. The WATSAL IMT programme concentrated on formulating the IMT legal framework. For each tranche, funds allocation was to be connected to the completion of particular legal regulations as WATSAL’s “policy products” (see Table 4.3). Furthermore, in the LoSP, the relation between the WUAs and the irrigation agency was directed towards a client–service provider relationship by giving the WUAs decision-making authority in systems management, as well as responsibility to manage the O&M funds. However, ironically, this relationship could only be established within the framework of infrastructure-oriented irrigation development, bearing in mind that more emphasis continued to be placed on the need to preserve or rehabilitate the infrastructures already in place. The same problematic issues, such as a deferred maintenance culture and O&M budgeting (as defined in the IOMP 1987 Statement), continued to be referred to in the WATSAL IMT programme, with the important issues for irrigation systems management never being fundamentally questioned. There was more discussion on the way the budgeting system should be developed for infrastructure maintenance than on the actual functioning of the infrastructure. Despite the preservation of O&M funding levels at about US$70–80 million equivalent per year since 1987, efficient and sustainable irrigation

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TABLE 4.3 WATSAL Agreement Tranche (in US$)

Conditions

Policy product

Proposed Actual completion completion

I 50 million

Preparation, announcement, and issuance of Inpres 3/99

Inpres 3/99, announced by president

April 1999

April 1999

II 100 million

Preparation and issuance of MoHA and Kimbangwil** Ministerial Decrees; preparation and issuance of Government Regulation

MoHA Decree on WUA Empowerment; Kimpraswil** Decree on IMT; Government Regulation on Irrigation

December December 1999 2001

III 150 million

Preparation and issuance of new Water Act; preparation of joint ministerial decree on KIIF

Passage of the Water Act; Ministries of Finance, Home Affairs, and Kimpraswil** Joint Decree on KIIF

March 2000

February 2004

Notes: * Actual completion dates are issuance dates of the legal policy products. ** preparation of decrees started under Kimbangwil but completed under Kimpraswil, which replaced Kimbangwil in 2001. Source: Letter of Sector Policy of 1999.

O&M is not being achieved by the provincial governments responsible for implementation. Funds are used primarily for staff support and administrative activities. The planned increase in regional fiscal and management autonomy raises further concerns. The current system of ISF has failed because of lack of accountability without a direct link between revenue and provision of O&M. A “deferred maintenance culture” together with periodic externally aided rehabilitation has resulted in a costly short-lived irrigation system. (LoSP 1999) The estimation of government O&M budgets will no longer be based on a per-hectare of command area formula. The O&M budget to be made available by a district government of each irrigation scheme will be matched or linked to the total ISF payments collected by scheme WUAs. Thus, a direct linkage will be created between district irrigation agency funding and WUA satisfaction with irrigation supply and support services and their consequent willingness to pay the ISF. This linkage will foster irrigation agency accountability for services toward WUAs. (LoSP 1999)

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The policy criticisms in the LoSP do not mean that the reformulation of IMT in 1999 lacked reform elements. In contrast, as mentioned earlier in this chapter, the scope of management transfer in Indonesia was broadened to all irrigation systems no matter the condition, and its degree was extended to the main system level. Furthermore, the introduction of the Kabupaten Irrigation Improvement Fund (KIIF) concept (discussed below) highlights the WATSAL policy-makers’ serious and determined attempts to retract the existing funds disbursement in the irrigation sector. The government will fundamentally change the institutional framework and financing mechanisms for irrigation infrastructure maintenance and rehabilitation. System-level WUA federations will have the right to request, prioritize, and control the quality of all infrastructure repair and development activities as part of the empowerment policy. In addition to the technical services and training to be made available by regional irrigation agencies, a government-financed Irrigation Improvement Fund will be established for demand-based rehabilitation and/or improvement of irrigation infrastructure under WUA/FWUA management at the district and/or provincial level as needed. (LoSP 1999)

SECTION V: WATSAL ORGANIZATIONAL STRUCTURE — FROM SECTORAL TO INTER-MINISTERIAL DECISION MAKING In 2000, to carry out the proposed reform programme, the NDPA defined the WATSAL organizational structure (see Figure 4.2). Within this structure, the irrigation agency’s decision-making authority was effectively replaced by an inter-ministerial decision-making platform. This shift solidified the NDPA’s authority in decision making outside the power realm of the Kimbangwil’s irrigation agency. The WATSAL office was even located on the premises of the NDPA. The Coordination Team acted as the highest decision-making body in the WATSAL organizational structure. The Coordinating Minister of Economy–Finance–Industry, the minister of Kimbangwil, and the head of the NDPA led the team. The Coordination Team comprised eleven different ministries: Kimbangwil, MoHA, MoA, Finance, Forestry, Environment, Health, Mining and Energy, Transportation, Trade and Industry, Fisheries. WATSAL’s organizational structure reflected the bureaucratic hierarchy in the Indonesian government’s eleven ministries — members of the

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FIGURE 4.2 WATSAL Organizational Structure WATSAL Coordination Team

WATSAL Steering Committee

WATSAL Task Force

Working Team I

Working Team II

Working Team III

Working Team IV

Coordination Team consisted of ministers from each ministry. Similarly, members of the Steering Committee consisted of director generals (or other government officials from Echelon64 2) from the respective ministries. Unlike the Coordination Team, which was responsible for defining the direction of policy reform, the Steering Committee was in charge of reviewing legal drafts produced by the WATSAL Task Force (WTF) and its working teams; the task force and teams consisted of government officials from Echelons 3 and 4 from each respective ministry. In addition, the membership of the WTF also included two representatives from prominent non-governmental organizations (NGOs). The WTF and working teams served as the engine in promoting policy reform in the water sector. From their position on the WTF, midlevel, pro-reform officials from the NDPA built their alliance to counteract the irrigation agency’s sectoral decision-making authority. From here on, I refer to the alliance of the pro-reform government officials as the WATSAL policy-makers. In addition, the WTF was responsible for facilitating and monitoring progress in the overall formulation of legal frameworks by the four working teams. However, in this study, I focus primarily on Working Team IV and its role in drafting the WATSAL IMT legal framework.65

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101 TABLE 4.4 WATSAL Policy Products Focus on

Proposed completion

Tranche

Policy product

Actual completion

I

Inpres 3 of 1999

Renewal of IMT policy

April 1999

13 April 1999

II

Government Regulation Number 77 of 2001

Irrigation

December 2001

5 December 2001

II

Kimpraswil Ministerial Decree Number 529 of 2001

Guidelines for IMT: from the irrigation agency to WUAs

December 2001

5 December 2001

II

MoHA Ministerial Decree Number 50 of 2001

Guidelines for WUAs’ Empowerment

December 2001

14 December 2001

Outside the WATSAL organizational structure, however, the WTF did not possess any power to influence the responsible ministries to accept any of their proposed legal frameworks. Draft regulations completed by the working teams were sent to the Steering Committee, which would then submit the proposed regulations to the respective ministries for approval and issuance or for rejection. Although this illogical bureaucratic set-up was apparent from the early stages of policy reform, it became a major problem when Kimpraswil issued its moratorium on the WATSAL IMT programme in September 2003.66 The completion of WATSAL policy products, up to its second tranche, is summarized in Table 4.4. Figure 4.3 presents the legal hierarchy of the IMT legal framework under WATSAL.

SECTION VI: THE STRATEGIC POSITIONING OF WUA EMPOWERMENT Following the general principles of the WATSAL IMT programme summarized in Inpres 3/99, IMT policy elements under WATSAL were to be elaborated in government regulations and ministerial decrees.

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FIGURE 4.3 Legal Hierarchy of the IMF Legal Framework under WATSAL

Parliament

President/Ministry

Act

Government regulation

President

Presidential decree

President

Presidential instruction

Minister

Ministerial decree

In Government Regulation Number 77 of 2001 on IMT, WUA empowerment was designed as the government’s grass-roots weapon to counteract institutionalized corruption within the irrigation agency (interviews with mid-level officials from the NDPA and MoHA, 2003). With reference to this policy design, or the hidden policy agenda67 in the 1999 WATSAL IMT programme, WUA empowerment was sought under the cloak of irrigation systems cost recovery. Hence, following the cost recovery path in the IOMP, in the WATSAL IMT programme, IMT was defined as the central government and regional governments handing over of rights, authority, and responsibilities to WUAs to arrange irrigation management and the financial costs within their operational boundary: 1. Central and regional governments are financially responsible for the construction of new main and secondary canals, main headworks, and other infrastructure except those at the tertiary level. 2. Irrigation management is autonomously and self-reliantly financed by WUAs according to their operational boundary. 3. Central and regional governments support WUAs in funds allocation for irrigation management. The channeling of the funds

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is agreed between central, regional governments, and WUAs, with strong emphasis on the principle of self-reliance. [Government Regulation Number 77 of 2001, Clause 13, Sub-clause 41 (on financial matters)]

Similarly, the requirements for handing over the authority for irrigation management included that the WUAs be successful in collecting ISFs: • WUAs are legally and democratically formed. • WUAs are successful in collecting ISF in cash, at least 50 per cent from its total members and 50 per cent of the total targeted fee collection, or in the form of labour and construction material to the same value. • Irrigation system is used mainly for agricultural purposes. • Transferred irrigation infrastructures are in good condition. • WUAs have developed irrigation management plan with support from the provincial and district government, if necessary. • IMT can be conducted after agreement from all WUA members. (Kimpraswil Ministerial Decree Number 529 of 2001, Clause 5 [on the requirement for IMT]). The strategy of WATSAL policy-makers to use WUA empowerment to counteract bureaucratic rent-seeking within the irrigation agency lies in the way the cost recovery aspect of IMT in the WATSAL programme was extrapolated into the creation of a new fund mechanism, the so-called Kabupaten Irrigation Improvement Fund or KIIF: • Irrigation systems management finance is disbursed through irrigation management funds at the district level. • WUAs can make proposals to use the funds to the Irrigation Committee. • The Irrigation Committee defines the priority in funds allocation of the irrigation management funds. • The head of the district defines the allocation of the funds as recommended by the Irrigation Committee. • District government defines district policy to further arrange the regulation of the irrigation management funds. (Government Regulation Number 77 of 2001, Clause 13, sub-clause 42 [on irrigation management funds])

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Linking the KIIF with WUA empowerment was intended to shift access to sectoral development funds from the irrigation agency to the WUAs (interviews with officials from the NDPA and Douglas Vermillion in 2003).68 With the KIIF, the development funds for the irrigation sector would be disbursed directly to the district governments, with the WUAs as the authorized funds managers. The idea derived from the proposition that institutionalized rent-seeking practices within the irrigation agency could only be eliminated if access to development funds was disallowed, given that the agency’s power was rooted in its access to the sectoral development funds. Put another way, WATSAL policy-makers understood that WUAs’ decision-making authority in irrigation systems management could only be acquired when the WUAs had direct access to the sectoral development funds.69 Consequently, the KIIF was designed to move the sectoral development funds disbursement from the irrigation agency to its representatives at the district level; application of the KIIF would remove the agency’s long-term infrastructure-based interests. It would completely shut off the irrigation agency’s access to the sectoral development funds, thus linking the WUAs’ direct access to these funds with the new principle of one irrigation system–one management and extending the WUAs’ decision-making authority up to the main system level of the irrigation systems. It is important to note here that, prior to the passage of Kimpraswil’s Ministerial Decree Number 529 of 2001 on IMT Guidelines, the irrigation agency was basically unaware of the potential threat embodied in the KIIF. Most of the core policy actors at the agency were not up-to-date with the actual progress of the WATSAL IMT programme, as most of the drafting work in relation to IMT policy reformulation was conducted by the WTF. Nevertheless, the officials from the irrigation agency who were involved in the WTF tried to maintain the agency’s power in the irrigation sector, despite their agreement to the reformulation of IMT under WATSAL. For instance, the term “handover” instead of “transfer” makes it clear that the agency’s decision would be all that mattered in the WATSAL IMT programme: it was in the hands of the agency whether or not to adopt and implement the IMT programme. The handover of irrigation management from the government to WUAs is conducted within one irrigation system as an integral management entity, but the government will continue to own the overall assets of physical infrastructure, which fall within more than one provinces or which has significant national value, from the government to WUAs

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will be directly arranged by the Minister according to defined rules and regulations. (Kimpraswil Ministerial Decree #529 of 2001, clause 3 [on scope of management transfer])

Furthermore, the agency’s determination to preserve its construction-based interest was reflected in Clause 11 of the ministerial decree, in which the quality of the physical condition of the irrigation system was defined as the first indicator of a successful IMT: • Successful IMT can be measured by looking at the condition of the irrigation system before and after management transfer, which include: • Physical improvement of irrigation infrastructure • WUAs organizational improvement • Improvement of irrigation service provision • Conflicts reduction • Agricultural development. (Kimpraswil Ministerial Decree Number 529 of 2001, Clause 11 [on IMT success indicators]). With the determination to maintain its bureaucratic power, it is hard to imagine, though, that the agency would have agreed to the introduction of the KIIF had it been fully aware of the concept’s real implications. At this early stage of IMT policy renewal, WATSAL policy-makers had successfully concealed the real implications of the KIIF from the irrigation agency. The majority of pro-reform officials on Working Team IV decided that the KIIF would only be briefly described in the 1999 LoSP, given it would disadvantage the irrigation agency’s position (interviews with officials from the NDPA and Kimpraswil in 2003). As stated by one NDPA official: “Logically, we would not put the proposed reform in jeopardy by formally including something in the policy that would evoke the irrigation agency’s resistance”. The somewhat hidden KIIF was hardly mentioned in either Government Regulation Number 77 or in the ministerial decree. For instance, in Kimpraswil Ministerial Decree Number 529, Clause 8, the WUAs’ authority to manage the irrigation systems included collecting, managing, and using management funds for sustainable systems management. It is unclear, however, how “management funds” is to be understood. Funding resources were identified; however, these resources referred to WUAs’ financial capability and government support only. Although the KIIF was considered as part of government

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funding support, how the money was to be directly disbursed to the district governments was never mentioned in the decree. Irrigation management funds should be provided following these principles: • WUAs empowerment • WUAs should fulfil management costs prior to requesting support from the government • Farmers contribute to WUAs through ISF, labours, and providing materials and equipment for system management in accordance to their capability • Funds for system management is defined based on regular monitoring and discussion • Government can provide financial support to stimulate irrigation system management • Government financial support to WUAs should be given transparently according to allocation criteria agreed by the Irrigation Committee. (Kimpraswil Ministerial Decree Number 529 of 2001, Clause 8 [on irrigation management funds]) In my opinion, the WATSAL policy-makers’ success in hiding their real agenda is partly due to the fact that the task redefinition of both the irrigation agency and the WUAs was not elaborated in Government Regulation Number 77. The redefinition of authority and responsibility, as well as the working mechanisms between different irrigation institutions, was made in accordance with the legal regulation (Government Regulation Number 77 of 2001, Clause 3 on institutional aspect of irrigation management, Sub-clause 8). From my interviews with WATSAL policy-makers, I learned that the issue of task redefinition had been intentionally ignored. Again, this was done to prevent active resistance from the irrigation agency. As stated in the Kimpraswil Ministerial Decree Number 529 of 2001, Clause 3: “The handover of management authority in irrigation included the redefinition of authority, rights, duties, and responsibilities of the irrigation agency”. WATSAL policy-makers thought that the task redefinition issue would be resolved once access to sectoral development funds shifted from the irrigation agency to the WUAs (interviews with NDPA officials in 2003): once the agency’s access to sectoral funds was removed, the agency’s power over the sector’s development would be removed too.

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The WATSAL policy-makers intended to use the WUAs for a different, but equally instrumental purpose. The WUAs would remain a central government policy instrument,70 despite IMT policy renewal. The organizational development of the WUAs would be centred on its role in IMT policy, not on the way farmers perceived the management problems in government irrigation systems; in other words, the WUAs’ organizational development would remain disconnected from the farmers’ actual needs. As stated in the MoHA Ministerial Decree Number 50 of 2001: “WUAs empowerment is conducted through a series of activities, which are indispensable from IMT”. Although it is true that IMT policy could not be implemented without the formation of the WUAs, the danger lurked that it would seem that the WUAs had been formed only to give the appearance that widespread implementation of IMT had occurred, as happened with IMT under the IOMP 1987 Statement. Last but not least, WATSAL policy-makers assumed that, unlike the irrigation agency, farmers in the WUAs would not get involved in rentseeking practices. The validity of this assumption is discussed in Chapter 7. One could predict, however, that the WUAs’ functioning would also be prone to rent-seeking practices, given that they had to follow the same bureaucratic procedures for funds allocation as the irrigation agency.

SECTION VII: THE IMPLEMENTATION SET-UP: NEW ELEMENTS, OLD STRUCTURE The implementation of IMT in the JIWMP–IDTO between 2000 and 2001 marked the transition from the IOMP to WATSAL. In 1999, when the agreement between the GOI and the World Bank was formalized in the LoSP, IMT policy remained under the JIWMP–IDTO. Officially, the JIWMP– IDTO loan lasted until 2000, but it was extended by one year due to the ongoing political reform in the country and its potential role to advance policy reform in the water sector. During 2000, Working Team IV produced the systematic framework for the implementation of the WATSAL IMT programme.71 With reference to Inpres 3/99, this framework divided the IMT implementation plan into five major steps: preparation for IMT implementation, task redefinition in systems management, WUAs’ empowerment, irrigation management financing, and sustainable irrigation management. These major steps were further broken down into what was known as the 101 WATSAL IMT activities.72 At the preparation stage, the framework focused on activities

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such as raising public awareness, the formation of irrigation committees, and the formulation of local regulations on irrigation management and their promulgation by provincial and district heads (although the framework surreptitiously included only task redefinitions for district-level irrigation institutions). The framework also incorporated fund allocation, fund use, and fund audit for the management of the irrigation systems. Sustainable irrigation management was addressed, emphasizing conservation aspects to secure water supply, to prevent the conversion of agriculture land, and to improve farmers’ household income. Although this framework for IMT implementation was not mentioned specifically in the government regulation and the ministerial decrees of 2001, it became the new guideline for WATSAL IMT programme implementation. Starting in 2001, the WATSAL IMT programme was financially supported by the World Bank under the JIWMP–IWIRIP (Indonesia Water Resources and Irrigation Reform Programme) loan. Unlike under the IOMP Statement, where the irrigation agency was solely in charge of policy implementation, the implementation of the WATSAL IMT programme under the JIWMP–IWIRIP loan was divided between an IDTO component (under Kimbangwil’s Directorate General of Rural Development) and a NewISF component (under MoHA’s Directorate General of Regional Development). The ISF under JIWMP had been transferred to the NewISF programme under MoHA in 2001, following a recommendation made by the World Bank’s review mission.73 The introduction of the NewISF as a separate policy programme in the irrigation sector increased the MoHA’s power, since it made it one of the government agencies in charge of IMT policy implementation. The MoHA’s NewISF programme divided the cash flow between two directorate generals, one in Kimbangwil and one in the MoHA. The exact reasons behind MoHA’s appointment were never formally stated or publicly presented.74 However, from my interview with government officials and World Bank senior officials in 2003, I learned that the change was made to limit the irrigation agency’s ability to detour the actual implementation of IMT towards construction-based development by reducing its access to sectoral development funds. Past implementation of IMT under the IOMP had shown that the irrigation agency’s resistance was the major reason for severe delays in systems turnover, including in IMT implementation under both ISSP II and JIWMP. Learning from past experiences, and advised by the WATSAL policy-makers, international

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donors positioned the MoHA as the second implementing government agency so that IMT under WATSAL could proceed without delay. Thus, under WATSAL, both Kimbangwil, which became Kimpraswil in 2001, and the MoHA had their own IMT projects. Under Kimpraswil’s project, the implementation of the WATSAL IMT programme continued to be focused on construction and rehabilitation activities.75 The budget for IMT implementation was spent mainly on participatory construction.76 Furthermore, the irrigation agency used the distinction between “field” and “non-field laboratory” sites to be able to limit the implementation of its own version of IMT to only seven irrigation systems (“field” laboratory sites),77 while construction and rehabilitation programmes were continued in all other systems (non-field laboratory sites), claiming this was necessary in preparation for management transfer. The seven field laboratory sites became irrigation systems that were rehabilitated under the JIWMP–IDTO loan in the third quarter of 1998. In addition, various studies on water use rights, task redefinition, asset management, and irrigation systems financing were conducted in the IDTO component of the Directorate General of Water Resources Development (DGWRD). However, it remained undefined how these studies were related to the WATSAL IMT programme activities under Kimpraswil’s project. In MoHA’s NewISF programme, on the other hand, the implementation of the WATSAL IMT programme was based on the systematic framework defined by Working Team IV. During the preparation stage, an irrigation committee was formed at the district level with a WUA representative, which allowed for local regulations on IMT to be formulated and promulgated. The NewISF programme focused on preparation for IMT implementation, task redefinition at the district level, and WUA empowerment. A special position, community organizer, was created to closely guide and facilitate WUA development. While participatory design and construction activities occurred during the implementation phase, and these activities formed part of the WUA empowerment, they did not stand on their own. Another major difference between the WATSAL IMT under the MoHA’s NewISF programme and Kimbangwil’s IDTO programme concerned the collaboration between the central government’s ministries and the district governments in the districts where IMT was being implemented. In the implementation of the WATSAL IMT programme under IDTO, regional governments were not involved in the decision-making process on IMT

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implementation, as it was funded solely by the irrigation agency at the national level. This meant that the selection of activities, priorities, and financial mechanisms were all prepared and decided by the agency. In contrast, under the MoHA’s NewISF programme, implementation was jointly funded by the central government (through the state’s income or APBN) and by the regional governments (through the regional governments’ income or APBD), and the funds were monitored by the MoHA, which worked closely with district and provincial government representatives. In addition, under the NewISF programme, the WATSAL IMT programme was spread throughout all four Java provinces (covering forty districts with six irrigation systems in each district to undergo IMT) and in all eight off-Java provinces (including sixteen districts with two irrigation systems in each district to undergo IMT). This is in sharp contrast to the narrow coverage of the WATSAL IMT programme under Kimpraswil’s irrigation project, which focused only on the four provinces in Java.78

CONCLUSION Clearly, the national government’s partial position on IMT policy formulation and implementation was shaped by the different forces and alliances in the central government ministries, and IMT policy evolution was shaped by the power struggles between the core policy actors in the irrigation agency and the WATSAL pro-reform policy-makers, particularly in the NDPA. An example of the core policy actors’ ability to defend the interests of the irrigation agency, regardless of pressure to adopt IMT policy from international donors, is the fact that they were able to transform the IMT policy under the IOMP 1987 Statement into a construction programme. Under the IOMP, the core policy actors at the agency successfully neutralized the conflict between IMT policy and its own identity by reducing the scope and importance of the proposed sectoral reform to a mere policy agreement between itself and the World Bank, meaning that the IOMP 1987 Statement did not oblige the irrigation agency to define its (formal) position on the proposed sectoral reform. Conversely, the fact that in 1999 the WATSAL policy-makers were able to design grass-roots farmer empowerment in an attempt to eradicate the institutionalized rent-seeking practices of the irrigation agency shows their ability to use the momentum of the political reform of 1998.

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IMT policy characteristics were shaped by the negotiations conducted by the policy elite within these different alliances, which focused on how to incorporate the elites’ opinions on the problems and their policy interests into the IMT policy agenda. The fact that the core policy actors could question the defined irrigation system classifications under the IOMP 1987 Statement highlights their strategy to redirect management transfer towards construction and rehabilitation activities. Meanwhile, the real implications of the KIIF were hidden from these same core policy actors, proving that the WATSAL policy-makers’ strategy was to proceed with the WATSAL IMT programme by blocking policy information. The WATSAL policy-makers addressed the antagonistic relationship between IMT policy and the bureaucratic identity of the irrigation agency through vague formulation of the KIIF in both the Government Regulation 77 of 2001 and the Kimpraswil Ministerial Decree Number 529 of 2001 to avoid “unnecessary” policy discussion with the core policy actors. Consequently, the formulation process of the IMT legal framework in 1999 was dominated by a hidden policy agenda. In this context, policy discussions were conducted by deciphering hidden conceptual meanings and policy negotiations were shaped through a game of political hide and seek. The unresolved policy controversy in Indonesian IMT overwhelmed the directives and aspirations of donor policies and deprived the policy of a substantial foundation for its implementation. The strategy of the WATSAL policy-makers to appoint MoHA as the second implementing agency as a substitute for actual reform in the irrigation agency proved to be efficient only in relation to MoHA’s ability to accelerate IMT implementation under its NewISF programme. Under the JIWMP–IWIRIP loan, IMT implementation continued to be routed towards a construction programme by the irrigation agency. Apart from their formal acceptance of loan conditions defined by the donors, the core actors continued to shift IMT policy into the realm of infrastructure development. Late in 2002, the policy controversy in Indonesian IMT re-emerged with Kimpraswil’s withdrawal from the process of formulating a joint ministerial decree — between MoHA, Kimpraswil, and the MoF — on the KIIF under the WATSAL programme. The withdrawal marked Kimpraswil’s awakening and the start battles over IMT policy, which is the topic of the next chapter.

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Notes   1. A policy controversy occurs between actors when agreed-upon criteria to reach an agreement are not the essential elements upon which communication is based (Rorty 1979). A policy controversy cannot be settled by recourse to facts alone or, indeed, by recourse to evidence of any kind, because the same body of evidence can be used to support quite different policy positions (Rein and Schön as cited in Fischer and Forester, 1993). Martin Rein and Donald Schön, “Reframing Policy Discourse”, in The Argumentative Turn in Policy Analysis and Planning, edited by F. Fischer and J. Forester (Durham, NC: Duke University Press, 1993), pp. 145–66; R. Rorty, Philosophy and the Mirror of Nature (Princeton, NJ: Princeton University Press, 1979).   2 The NDPA is comparable to the Ministry of Planning and Investment in other countries. The importance of pro-reform government officials from the NDPA working with the new Kimbangwil officials in the inter-ministerial decisionmaking process put an end to the irrigation agency’s authority to define how development budgets were distributed. The need for reorganization was due to the irrigation agency’s (under the MPW) notorious reputation as one of the most corrupt agencies in Indonesia. This reorganization from the MPW into Kimbangwil created room for pro-reform officials to steer the agency’s involvement under WATSAL.   3. H.M Malano and P.L.M. Hofwegen, “Management of Irrigation and Drainage Systems: A Service Approach”, IHE Monograph no. 3 (Rotterdam: A.A. Balkema, 1999); H. Turral, Recent Trends in Irrigation Management: Changing Directions for the Public Sector (London: Natural Resource Perspective, ODI Series, 1995); Douglas L. Vermillion and J.A. Sagardoy, “Transfer of Irrigation Management Services: Guidelines”, FAO Irrigation and Drainage Paper no. 58 (Rome: FAO, 1999).   4. Sam H. Johnson III, Mark Svendsen, and Fernando Gonzales, “Institutional Reform Options in the Irrigation Sector”, Agriculture and Rural Development Discussion Paper no. 5 (Washington, DC: World Bank, 2004).   5. Bryan Bruns and Sudar Dwi Atmanto, “How to Turn Over Irrigation Systems to Farmers? Questions and Decisions in Indonesia”, Irrigation Management Network Paper no. 10 (London: ODI, 1992).   6. IWIRIP, Progress Report: Thirty-second Quarterly Period April–June 2003 (The Netherlands: DHV Consultants BV, 2003).   7. IMT policy adoption by developing country governments is often based on fiscal needs, rather than by motivation to conduct policy reform. International E-mail Conference on Irrigation Management Transfer organized by Food and Agricultural Organization and International Network of Participatory Irrigation Management, 2001; C. Lele, “Godsend, Sleight of Hand, Or Just Muddling

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  8.

  9.

10.

11.

12.

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Through: Joint Water and Forest Management in India”, ODI Natural Resource Perspective no. 53 (April 2000): 1–6. The fact that the agency’s resistance was never concretely addressed is also influenced by the common protocol of international donor agencies of not getting involved in a country’s political situation. In this context, addressing an agency’s bureaucratic resistance is perceived as political intrusion towards developing country governments. Bryan Bruns, “From Voice to Empowerment: Rerouting Irrigation Reform in Indonesia”, in The Politics of Irrigation Reform: Contested Policy Formulation and Implementation in Asia, Africa and Latin America, edited by Peter P. Mollinga and Alex Bolding (London: Ashgate, 2003); Douglas L. Vermillion, “Irrigation Management Transfer: Towards an Integrated Management Revolution”, address presented at the International Conference on Irrigation Management Transfer in Wuhan, People’s Republic of China, 20–24 September 1994. Peter P. Mollinga, R. Doraiswamy, and Kim Engbersen, “Participatory Irrigation Management in Andhra Pradesh, India: Policy Implementation and Transformation in the Tungabhadra Right Bank Low Level Canal”, International Journal for Water 1, no. 3–4 (2001): 369–79; Balaraju Nikku, The Politics of Policy: Participatory Irrigation Management in Andhra Pradesh (Ph.D. dissertation, Wageningen University, The Netherlands, 2006). Several state-centred studies on irrigation management analyse the role of the irrigation agency in sector development. See for instance studies conducted by Mick Moore (1989) and Robert Wade (1982, 1985) that highlight a state’s decisive influence in directing irrigation system management in Taiwan and South India, respectively, and see studies conducted by Uphoff, Ramamurthy, and Steiner (1991) that shed a light on irrigation bureaucracy in Sri Lanka. However, focusing mainly on the state’s role, these studies describe each irrigation agency’s bureaucratic mechanisms only in general terms. Mick Moore, “The Fruits and Fallacies of Neo-liberalism: The Case of Irrigation Policy”, World Development 11, no. 7 (1989): 1733–50; Robert Wade, “The Market for Public Office: Why the Indian State is Not Better at Development”, World Development 13, no. 4 (1985): 467–97; Robert Wade, “The System of Administrative and Political Corruption: Canal Irrigation in South India”, Journal of Development Studies 18, no. 3 (1982): 287–328; N. Uphoff, with Priti Ramamurthy and Roy Steiner, Managing Irrigation: Analyzing and Improving the Performance of Bureaucracies (New Delhi/Newbury Park/London: Sage Publications, 1991). C.J. Bauer, “Bringing Water Markets Down to Earth: The Political Economy of Water Rights in Chile, 1976–1995”, World Development 25, no. 5 (1997): 639–56; D. Carney, Changing Public and Private Roles in Agricultural Services Provision (London: Natural Resources Group ODI, 1998); Mark W. Rosegrant and Hans

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13. 14.

15.

16.

17.

18. 19. 20.

21. 22.

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P. Binswanger, “Markets in Tradable Water Rights: Potential for Efficiency Gains in Developing Country Water Resource Allocation”, World Development 22, no. 11 (1993): 1613–25; L.E. Small, “User Charges in Irrigation: Potential and Limitations”, Irrigation and Drainage Systems 3, no. 2 (1989): 125–42. D.C. North, Institutions, Institutional Change and Economic Performance (Cambridge: Cambridge University Press, 1990; Vermillion and Sagardoy, “Transfer of Irrigation Management Services”. Harald D. Frederiksen, “Water Resources Institutions: Some Principles and Practices”, World Bank Technical Paper no. 191 (Washington, DC: World Bank, 1992); J. Gerards, No Money, No Water (Water Has Value): Water Resources Management in Indonesia for the Next Twenty-Five Years (1992–2018) (Jakarta: Gaia International Management, 1992). Wim H. Kloezen, Accounting for Water: Institutional Viability and Impacts of Market-oriented Irrigation Interventions in Central Mexico (Ph.D. dissertation, Wageningen University, the Netherlands, 2002); Mark Svendsen, “Financial Autonomy, Institutional Reform and Irrigation Performance”, Vikalpa 19, no. 2 (1994): 35–42. Moore, “The Fruits and Fallacies of Neo-liberalism”; R. Repetto, “Skimming the Water: Rent-seeking and the Performance of Public Irrigation Systems”, Research Report no. 4 (Washington, DC: World Resources Institute, 1986); Mark Svendsen, “The Impact of Financial Autonomy on Irrigation System Performance in the Philippines”, World Development 21, no. 6 (1993): 989– 1005. E. Walter Coward, “Direct or Indirect Alternatives for Irrigation Investment and the Creation of Property”, in Irrigation Investment, Technology and Management Strategies for Development, edited by K.W. Easter, Studies in Water Policy and Management no. 8 (Colorado: Westview Press, 1986); Vermillion and Sagardoy, “Transfer of Irrigation Management Services”. Randolph Barker and Francois Molle, Evolution of Irrigation in Asia, IWMI Research Report: Comprehensive Assessment of Water Management in Agriculture (Sri Lanka: IWMI, 2000). E. Ostrom, Crafting Institutions for Self-Governing Irrigation Systems (San Francisco, CA: ICS Press, 1992). I. Carruthers and J.A. Morrisson, “Institutions in Water Resources Management: Insights from New Institutional Economics”, in Water Policy: Allocation and Management in Practice, edited by P. Howsam and R.C. Carter (London: E & FN Spon, 1996), pp. 205–12. Sam H. Johnson III, Douglas L. Vermillion, Juan A. Sagardoy (eds.) Irrigation Management Transfer. Selected papers from the International Conference on IMT in Wuhan, People’s Republic of China, 20–24 September 1994. Walter Huppert, Mark Svendsen, and Douglas L. Vermillion, “Governing

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23. 24.

25.

26. 27.

28. 29. 30. 31.

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Maintenance Provision in Irrigation (Eschborn: GTZ, 2001); Sam H. Johnson III, “Selected Experiences with Irrigation Management Transfer: Economic Implications”, Water Resources Development 11, no. 1 (1995): 61–72; M.M. Moustafa, “Can Farmers in Egypt Shoulder the Burden of Irrigation Management?” Journal of Irrigation and Drainage Systems 18, no. 2 (2004): 109–25; Vermillion and Sagardoy, “Transfer of Irrigation Management Services”. Frederiksen, “Water Resources Institution”. In their book on the politics of irrigation reform, Mollinga and Bolding (2003) identify three themes for further research: the resilience of the irrigation agency in resisting reform, the role of international donor agencies, and the reshaping of reform policy in the implementation process (see also Rap 2004; Khanal 2003; Zawe 2006). Puspa Raj Khanal, Engineering Participation: The Processes and Outcomes of Irrigation Management Transfer in the Terai of Nepal (Ph.D. dissertation, Wageningen University, The Netherlands, 2003); Peter P. Mollinga and Alex Bolding, eds., The Politics of Irrigation Reform: Contested Policy Formulation and Implementation in Asia, Africa and Latin America (London: Ashgate, Global Environmental Governance Series, 2003); Edwin Rap, The Success of a Policy Model: Irrigation Management Transfer in Mexico (Ph.D. dissertation, Wageningen University, The Netherlands, 2004); Conrade Zawe, Reforms in Turbulent Times: A Study on the Theory and Practice of Three Irrigation Management Policy Reform Models in Mashonaland, Zimbabwe, (Ph.D. dissertation, Wageningen University, The Netherlands, 2006). Mollinga and Bolding, The Politics of Irrigation Reform; Mick Moore, “Political Underdevelopment: What Causes Bad Governance?” Public Management Review 3 no. 3 (2001): 385–418; Mick Moore, “Revenues, State Formation and the Quality of Governance in Developing Countries”, International Political Science Review 25, no. 3 (2004): 297–319. Bruns, “From Voice to Empowerment”; Bruns and Atmanto, “How to Turn Over Irrigation Systems to Farmers?” At the national level, I look at how IMT policy is formulated in the negotiation process among the different government ministries; at the provincial level, I focus on the role the provincial governments have in channelling this policy to the district levels; and at the field level, I investigate how IMT is linked in the relationship among the FWUAs, WUAs, and farmers, and how it directly affects farmers’ actual water distribution and usage. Kloezen, Accounting for Water. Zawe, Reforms in Turbulent Times. James E. Anderson, Public Policymaking: An Introduction (New York: Houghton Miflin, 1997). In the irrigation literature, this policy is also referred to as Irrigation Management Turnover, Participatory Irrigation Management (Vermillion

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32. 33.

34.

35. 36. 37. 38. 39.

40. 41. 42. 43. 44. 45. 46. 47. 48.

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1997), or Irrigation Management Reform (Zawe 2006). Douglas L. Vermillion, “Impacts of Irrigation Management Transfer: A Review of the Evidence, IWMI Research Report No. 11” (Colombo: IWMI 1997); Zawe, Reforms in Turbulent Times. Bruns, “From Voice to Empowerment”. In principle, WUAs were formed to represent farmers’ needs in the overall management of the irrigation system. Prior to WATSAL, WUAs’ main tasks were focused on collecting the ISFs from farmers and conducting canal maintenance (mostly at the tertiary level). Under WATSAL, WUAs’ organizational functioning was expanded up to secondary- and main- system levels, with the formation, of respectively, the FWUAs and the system-level WUAs. The tertiary level represents the network of irrigation canals directly connected to farmers’ fields. In larger scale irrigation, it is the local irrigation unit that receives water from the upstream primary and secondary levels (the conveyance system conventionally managed by the irrigation agency). Douglas L. Vermillion et al., “An Assessment of the Small Scale Irrigation Management Turnover Program in Indonesia”. Research Report 38 (Colombo: IWMI, 2000). Soenarno I., “Irrigation Management Transfer in Indonesia”, in Irrigation Management Transfer in Asia, edited by J.C. Geijer. Rome and Colombo: FAO and IWMI. Bruns, “From Voice to Empowerment”. In fact, these smaller systems were already farmer managed. The re-terming shows the irrigation agency’s strategy to camouflage its monetary interests. As the new term fit the new policy from the perspective of the foreign donors, it ensured the allocation of funds into the agency. How this worked is described in this chapter. Bruns and Atmanto, “How to Turn Over Irrigation Systems to Farmers?” Ibid. Bruns, “From Voice to Empowerment”. World Bank 2003. Bruns, “From Voice to Empowerment”. Ibid. Nikolai Sindorf and Diana Suhardiman, “Interactive Irrigation: Policies and Practices in Irrigation Management Transfer in West-Java, Indonesia” (M.Sc. thesis, Wageningen University, The Netherlands, 1998). ISSP II. Turnover Evaluation Report: Irrigation O&M and Turnover Component (Jakarta: Mott MacDonald International Ltd., 1993); JIWMP–IDTO Inception Report (The Netherlands: DHV Consultants BV, 1995). Soeparmono and Sutardi, “Institutional and Technical Options in the

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49. 50. 51. 52. 53. 54. 55. 56. 57.

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Development and Management of Small-scale Irrigation”, Paper Presented at the Third Session of the Multilateral Workshops (GCP/INT/629/JPN) on Institutional and Technical Options in the Development and Management of Small-Scale Irrigation, Tokyo, 3–6 February 1998. JIWMP–IDTO, Progress Report: Twenty-eighth Quarterly period (April–June (August)) (The Netherlands: DHV Consultants BV, 2002). Sindorf and Suhardiman, “Interactive Irrigation”. Vermillion et al., “An Assessment of the Small Scale Irrigation Management Turnover Program in Indonesia”. Ibid. Ibid. Ibid. D.K. Nanto, The 1997 Asian Financial Crisis, CRS Report for Congress, 1998. A. E. Priyono, Stanley Adi Prasetyo, and Olle Tornquist, Gerakan Demokrasi di Indonesia Pasca Soeharto [Democratic Movement in Indonesia post Suharto] (Jakarta: Bina Aksara, 2003). Apart from this attempt by the NDPA, sectoral reform had been previously attempted in 1992 by mid-level officials from the irrigation agency. These officials realized that, to cope with the challenges, the agency needed to change its development approach from an individual sectoral one (the irrigation sector) to an inter-ministerial one, involving all sectors. It was unlikely that high-level irrigation agency officials would accept these proposed measures, since the shift to inter-ministerial decision making would considerably reduce their authority. These mid-level officials failed to initiate the proposed reform, as they, of course, lacked support from their senior officials in the agency. It was in an attempt to remove this policy short-sightedness that, also in 1992, the NDPA arranged an international seminar on integrated development and management of water resources for sustainable use (Cisarua Seminar Proceedings on Integrated Development and Management of Water Resources for Sustainable Use in Indonesia, Bogor, 29 October–1 November 1992). Two years later, the NDPA organized a national forum to discuss government strategies for the sector’s development, based on ideas developed at the Cisarua seminar. In 1995, decisions made at the national forum resulted in: the formal recognition of water resources as a separate sector, the formation of a bureau of water resources and irrigation within the NDPA, and the reorganization of the irrigation agency under the Directorate General of Water Resources and Development (DGWRD) of the MPW. In 1997, the NDPA arranged a series of national discussions on water policy, funded by the Ford Foundation and the World Bank, to address the lack of inter-sectoral coordination in the water sector. Unfortunately, the fiscal crisis in Indonesia starting in that same year coincided with the first discussion series.

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58. In practice, this alteration shifted the responsibility from the MoA to NDPA for WATSAL implementation. 59. As the MPW was coming to an end, and Kimbangwil was being created to replace it, bureaucratic leadership within the irrigation agency was being challenged. The new minister of Kimbangwil, Erna Witoelar, did not come from the MPW, so it was uncertain whether the irrigation agency’s overall bureaucratic identity would survive. 60. As discussed in Chapter 2, five months after the fall of Suharto’s government, with the country facing mounting political pressure from student movements, the People General Assembly decree made concrete the concept of regional autonomy. Through this decree, the central government’s power was dissolved in favour of regional self-government. Less than a year later, in 1999, the decree was succeeded by passage of the Regional Autonomy Act (Number 22 of 1999). 61. These prominent scientists remained involved in the implementation of the WATSAL IMT programme. A couple of months later, a group of scientists from Gadjah Mada University and Padjajaran University merged with prominent NGO actors to form the Consortium of NGOs and Universities. This consortium was actively involved in directing the implementation of the WATSAL IMT programme under the NewISF programme of the MoHA, and it became the informal think tank of the Directorate General of Regional Development in the MoHA. 62. The use of the word democratic shows the WATSAL IMT programme inclination towards popular political movements. 63. M. S. Grindle, Getting Good Government: Capacity Building in the Public Sectors of Developing Countries. Harvard Studies in International Development (Boston, MA: Harvard University Press, 1997). 64. See Chapter 3 on the description of echelon system within the Indonesian bureaucratic structure. 65. Working Team I was responsible for drafting the legal framework for the national water policy, and Working Teams II and III were in charge of drafting the legal regulations for river management and water quality issues, respectively. 66. Kimbangwil was replaced by Kimpraswil in 2001. 67. This policy perception is not stated explicitly in the policy papers, as bureaucratic rent-seeking is never formally presented as part of management problems in Indonesian government irrigation systems. However, it is commonly understood within the circle of government bureaucracies that the main problem in the irrigation sector lies in institutionalized rent-seeking, facilitated by project mechanisms in and around the allocation of sectoral development funds. This perception was strongly acknowledged by mid-level

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68.

69. 70. 71. 72. 73. 74.

75. 76. 77.

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officials from NDPA (interviews with mid-level officials from the NDPA, 2003). Yet, these officials were also fully aware of the issue’s sensitivity. Vermillion’s involvement in irrigation sector reform in Indonesia dates back to January 1986 when he was a researcher and policy specialist for IMT with the International Irrigation Management Institute. Between 1999 and 2003, Vermillion was the member of the World Bank’s WATSAL team, which was responsible for irrigation sector reform. During this time, he helped develop policy and strategy, met with stakeholders, negotiated in the bank’s interest, and helped to develop Government Regulation Number 77 of 2001 and other ministerial decrees related to the WATSAL policy products. The formulation of the KIIF as a new concept in irrigation systems management was made possible partly through the incorporation of sectoral policy reform into the widespread implementation of regional autonomy in the country. This presents another paradox in IMT. Despite the transfer, WUA organizational development was defined and directed according to the central government’s, not the famers’, needs. Bambang Adinugroho, “IMT Implementation Framework”, Paper Presented on the IMT Training in Denpasar, 5–10 October 2003. Ibid. Theodore Herman, “Indonesia’s Water Sector Policy and Institutional Reform Process”, Draft, 2003. The incorporation of the WATSAL IMT programme into the overall context of regional autonomy facilitated greater involvement of the MoHA in the irrigation sector, but, does not explain why it was given a new role as implementing agent in 1999. Consortium of NGOs and Universities, “Study on Impact of Irrigation Management Policy Reform Implementation in Indonesia” (Jakarta: Consortium of NGOs and Universities, 2003). IWIRIP, Progress Report: Thirty-second Quarterly Period April–June (Jakarta: World Bank, 2003). Almost at the same time that the IMT policy renewal was being prepared, the World Bank rejected the GOI proposal to rehabilitate ten or twelve irrigation systems between 500 and 1,000 hectares, in the third quarter of 1998. However, after intensive negotiation, World Bank finally accepted the rehabilitation proposal for seven irrigation systems, requiring that such rehabilitation activities be started with institutional empowerment activities for the WUAs (World Bank 1998). The location of these seven irrigation systems was spread over the four provinces on Java (Consortium of NGOs and Universities 2003), and these irrigation systems were later referred to as the JIWMP’s field laboratories. It is important to note that these field laboratories, whose financial source was JIWMP–IDTO, were not the field laboratories for the new

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IMT but were labelled such because they had been selected as the location for experimentation on the “holistic approach” modelling of irrigation-based rural development. This experiment was promoted by Kimbangwil’s new Directorate General of Rural Development in early 1999. At that time, this directorate general position had just replaced the position of DGWRD in the irrigation sector. (Consortium of NGOs and Universities, “Study on Impact of Irrigation Management Policy Reform Implementation in Indonesia”; World Bank, “Aide Memoire JIWMP Mission” (Washington, DC: World Bank, 1998). 78. In 2001, when Banten became an individual province, Kimpraswil’s irrigation project covered IMT implementation in five Java provinces.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

5 THE STRUGGLE ON THE PRINCIPLES OF IMT UNDER THE WATSAL PROGRAMME

INTRODUCTION This chapter gives further insights on how interdependencies and alliances at the central government ministries contested ideas and contradictions in Irrigation Management Transfer (IMT), as incorporated in the Water Sector Adjustment Loan (WATSAL) IMT programme. This chapter, organized into ten sections, analyses the political wranglings in chronological order and maps the evolution of coalitions in the overall promulgation process of the new Water Act. Section I analyses the conflicting policy frames in Indonesian irrigation development.1 The prelude to the IMT policy struggles on the principles of management transfer is examined in Section II. Kimpraswil’s controversial revised clauses of the new Water Act, from those originally formulated by Working Team IV in the WATSAL Task Force (WTF), are discussed in Section III, while Section IV details both Kimpraswil’s moratorium and its relationship with the other ministries. In Section V, I show how Kimpraswil and the Ministry

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of Home Affairs (MoHA) each designed specific actions to legitimize their positions on the WATSAL IMT programme. The parliamentary network and networking at each stage of the Water Act promulgation process are then discussed: Section VI covers the emergence of a Kimpraswil– PDI-P (Partai Demokrasi Indonesia–Perjuangan) coalition that wanted to retain power over the IMT process; Section VII covers the emergence of a counter-alliance that sought to give the farmers and Water Users Associations (WUAs) more control; and Section VIII discusses the reoccurrence of bureaucratic conflicts between the National Development Planning Agency (NDPA) and Kimpraswil. Section IX discusses actions various actors took after the draft Water Act was returned to parliament, and Section X rounds out the chapter with an analysis of the Kimpraswil– World Bank relationship.

SECTION I: CONFLICTING POLICY FRAMES IN INDONESIAN IMT IMT policy renewal under WATSAL symbolized the attempt of the new Indonesian government (or some segments of it) to reform irrigation sector development as part of the country’s 1998 political reform. In the early 2000s, however, the national government’s position towards political reform was divided between those who wanted the reform to continue and those who did not.2 In the irrigation sector, these political differences became the battleground of various ministries fighting for decision-making power and control of the budget. These battles illustrate the presence of “frames conflict” in Indonesian irrigation policy development.3 Frames conflict occurs when conflicting views cannot be settled by recourse to either facts or evidence “because… the same body of evidence can be used to support quite different policy positions”.4 The frames conflict in this case occurred when other central government ministries contested the irrigation agency’s or Kimpraswil’s conception of IMT. The IMT policy was perceived differently by government staff at Kimpraswil, the MoHA, and the NDPA based on their roles, functions, and interest in IMT formulation and implementation under WATSAL. Table 5.1 shows how the battles over IMT at the inter-ministerial level were rooted in the different ministries’ desires to either sustain or gain access to sectoral development funds. The battle lines were drawn by: groups inside and outside the ministries, including the Consortium of NGOs and Universities; mid-level government officials from the NDPA,

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Government agency Formulate and implement responsible for the regional irrigation policies autonomy policy and thus the sectoral policy reform in the irrigation sector

MoHA

Funding agency

Legislative body in the act promulgation

International donors

Commission IV in the parliament

Promulgate legal act (on irrigation)

Sustain and increase their political power, both through access to development funds and political networking

Release funding to promote “good governance”

Monitor the formulation and Promote bureaucratic reform implementation of IMT through policy change

Civil society movement force

Consortium NGOs and Universities

Promote bureaucratic reform through policy change

Gain additional access to development funds in the irrigation sector

Regain its decision-making authority, and thus its bureaucratic power at interministerial level

Formulate IMT reform legal frameworks and monitor IMT implementation

Define project funding

Perception towards IMT

Unknown

IMT is a strategy to cut the cycle of corruption in the irrigation agency and secure the earlier investments in infrastructure development1

IMT is a strategy to cut the cycle of corruption in the irrigation agency

IMT is a strategy to cut the cycle of corruption in the irrigation agency

IMT is a strategy to grant MoHA access to sectoral development funds

IMT is a strategy to regain NDPA’s inter-ministerial decision-making power

Sustain its access to development IMT is permitted as long funds, and thus ensure its as it does not touch bureaucratic power in the sector the agency’s access to development funds or shift the agency’s focus on infrastructural development

Interest

WATSAL policy Inter-sectoral organization makers responsible for directing sectoral development according to the LoSP 1999

Coordinate inter-ministerial activities in irrigation sector in particular and water sector in general

Authorized agency for inter-ministerial decisionmaking platform in irrigation under WATSAL

National Development Planning Agency

Formulate and implement irrigation policies

Function

The main bureaucratic actor and the executing agency in the irrigation sector

Role

Irrigation agency/ Kimpraswil

Institution

TABLE 5.1 Policy Actors’ Perceptions of IMT The Struggle on the Principles of IMT under the WATSAL Programme

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MoHA, and Kimpraswil; and retired officials from Kimpraswil allied in the Irrigation Communication Network of Indonesia (JKII). The consortium itself consisted of actors inside and outside the government, including midlevel, pro-reform government staff from different ministries; academics from a number of universities; and prominent non-governmental organization (NGO) leaders. During the IMT policy struggles, some WATSAL policymakers joined the consortium, as Kimpraswil’s moratorium made the WATSAL organizational structure dysfunctional. The description and analysis of the IMT policy battles in this chapter are based on opportunities given to me by different policy actors5 to observe the policy negotiations that took place at the ministerial, interministerial, and parliamentary levels between September 2003 and February 2004. I attended a series of parliamentary meetings, Kimpraswil’s public consultations, MoHA’s forum, and farmer demonstrations arranged by the consortium. I also joined consortium members on formal and informal visits with different members of parliament, as well as to the heated meeting between Kimpraswil officials and consortium members one day prior to a parliamentary plenary meeting. I was allowed access to the formal meeting notes prepared by the Sub-Directorate of Water Resources (SDWR) in the MoHA. These meeting notes were particularly important for my understanding on how MoHA’s position on IMT was shaped by the different interests of its staff. Through direct interviews with NDPA officials and with access to NDPA formal meeting notes (especially those related to the NDPA seminar cancellation), I gained insights into the perceptions and strategies of the NDPA officials who aimed to counteract Kimpraswil’s demand to recentralize the sector’s development. I also gained insights into the formulation of Kimpraswil’s moratorium and its strategy to redirect the reform efforts under WATSAL (through the revision of the draft Water Act) from direct interviews with both pro-reform and anti-reform Kimpraswil officials. By detailing the events in chronological order, the development of the IMT policy discourse in Indonesia is more clearly understood in relation to the different strategies used by the ministries and agencies protecting their own bureaucratic interests. Strategies included, for example, Kimpraswil’s foot-dragging on IMT policy by delaying the overall process of management transfer and its political gamesmanship in contesting and counteracting the earlier-issued IMT legal frameworks of the draft Water Act in parliament. Both strategies were rooted in

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the irrigation agency’s/Kimpraswil’s unchanged opinion towards the proposed sectoral reform.

SECTION II: PRELUDE TO THE IMT POLICY STRUGGLES The policy struggles over IMT began when Kimpraswil withdrew from the process of formulating a joint Ministerial Decree on the Kabupaten Irrigation Improvement Fund (KIIF). According to the 1999 Letter of Sector Policy (LoSP), the joint ministerial decree was to be created and was to be formulated by Kimpraswil, the MoHA, and Ministry of Finance (MoF) in December 2003, prior to the third tranche of the World Bank’s WATSAL fund disbursement. However, in June 2003, Kimpraswil refused to proceed with the promulgation process. Kimpraswil’s decision to withdraw originated with a letter written in mid-2003 by a retired high official from Kimpraswil, addressed to its minister (interviews with Kimpraswil, MoHA, MoA, and NDPA officials, 2003). By this time, the draft Water Act had entered parliament, where this retired official remained one of Kimpraswil’s appointed representatives. In reading the draft act, he realized that the section on irrigation was not thoroughly written; to improve the section, he wanted to reference the Government Regulation Number 23 of 1984 on irrigation … only to discover that it had been replaced by a newer government regulation — Government Regulation Number 77 of 2001. Reading the new regulation for the first time, he realized the potential dangers of IMT under WATSAL for the irrigation agency and Kimpraswil. He alerted the minister in that IMT implementation should be restricted to irrigation systems smaller than 500 hectares, which would be a return to the IOMP 1987 Statement. After receiving this advice, the minister arranged a closed-door staff meeting with officials from Echelons 1 and 2 belonging to his inner circle of power: the so-called core policy actors. It was determined that the pending Water Act would be used as Kimpraswil’s legal basis to reduce the scope and degree of IMT implementation under WATSAL desired by other ministries. They decided to do this by revising the content of the draft Water Act. The letter also detailed the role Kimpraswil’s core policy actors should take in safeguarding the agency’s bureaucratic interests. The renewal of IMT should be permissible only as long as it was linked to the cost recovery objective incorporated in the IOMP 1987 Statement. In his letter,

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he argued that the management of government irrigation systems should not be transferred to the WUAs if the WUAs were to remain financially dependent on the agency’s development budget. From my interviews in 2003 with MoHA and Kimpraswil officials, the core policy actors thought that the IMT policy renewal diminished their agency’s power. Under WATSAL, decision making had been transferred to an inter-ministerial platform under the coordination of the NDPA, and the WATSAL budget was divided between Kimpraswil and the MoHA.6 In addition, WATSAL did not result in the immediate funds allocation from the World Bank to the irrigation agency. During the ministry’s transition period between 2000 and 2001 (from Kimbangwil to Kimpraswil), it had to use existing development budget (under the JIWMP–IDTO [Java Irrigation Improvement and Water Resources Management Project–Irrigation Development Turnover]) to finance IMT implementation. The re-emerging importance of the core policy actors in the irrigation agency was made possible when the State Ministry of Public Works (Meneg PU) and the Ministry of Housing and Regional Development (Kimbangwil) were combined into the Ministry of Settlement and Regional Infrastructure (Kimpraswil) in 2001. During the first reorganization, from the Ministry of Public Works (MPW) to Kimbangwil in 1999, the core policy actors were excluded from key bureaucratic positions. However, with the second reorganization in 2001, these actors returned to the overall bureaucratic structure. During this early stage of Kimpraswil’s existence, key bureaucratic positions were still held by mid-level officials who were pro-reform WATSAL policy-makers. These mid-level officials were able to conceal the real implications of IMT renewal under WATSAL from the core policy actors. That is, until the letter arrived from the retired official loyal to the minister of Kimpraswil. The first indication of the core policy actors’ renewed importance was the changing membership composition of the WTF and its Working Teams. In September 2002 (one year prior to Kimpraswil’s withdrawal from writing a joint decree), a key WATSAL policy-maker from the NDPA was removed from the WTF.7 The exact reason behind this removal was never made clear, though according to interviews with officials from the NDPA and Kimpraswil in 2003, speculation was that it was related to the official’s determination to extend the scope and degree of IMT under WATSAL beyond what the Kimpraswil minister was willing to accept. Following his removal, the leadership of the WTF was transferred from

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the NDPA to Kimpraswil under the Coordinating Minister for Economic Affairs Ministerial Decree Number 13 of 2002. With the exception of Working Team III, officials from Kimpraswil now held the leadership position in the other three working teams (Working Teams I, II, and IV). Under Coordinating Minister for Economic Affairs Ministerial Decrees, Number 15 of 2001 and Number 39 of 2002, the number of Kimpraswil representatives in each Working Team on the WTF was tripled. In addition, the status of the two NGO8 representatives on the WTF was changed from active members to only external advisors.

SECTION III: CONTROVERSIAL REVISED CLAUSES IN THE DRAFT WATER ACT Once the danger to its interest was realized, Kimpraswil’s strategy to redirect the path of IMT under WATSAL focused on revising three clauses on irrigation in the draft Water Act: Clause 43 on task redefinition, Clause 68 on operation and maintenance (O&M), and Clause 81 on financing. Before I discuss the revised editions of these three clauses, I need to describe the act promulgation procedure, which fully authorized Kimpraswil as the responsible ministry in the irrigation sector to revise the draft Water Act that had been created by WATSAL Working Team IV.

Water Act Promulgation Procedure The original version of the draft Water Act was completed by Working Team IV of the WTF in August 2001. The draft act was then sent for approval to the WTF interministerial committee, consisting of Kimpraswil and other relevant ministries (Agriculture, Home Affairs, Forestry, Mines, and Industry). Following the committee’s approval, the draft act was sent to the president; in October 2001, the president proposed its promulgation to parliament, and, in November 2002, the draft act was presented at a plenary meeting (see Figure 5.1 for the legal process). In parliament, the draft Water Act was sent for review to Commission IV, specialized in infrastructure development. This appointment reflects how the promulgation process of the Water Act was linked to Kimpraswil’s bureaucratic identity and interest. Like other parliamentary commissions, Commission IV consisted of representatives from different political parties; the specific representation was determined by the number of parliamentary

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FIGURE 5.1 The Legal Procedure of the Water Act Promulgation Formulation by WATSAL task force

Approval by inter-ministerial committee

Proposed by president to parliament

Presented at parliamentary plenary meeting

Channelled to commission IV

Approved by commission IV

Edited by formulation team

Approved by working committee

Channelled to working committee of commission IV

Edited by formulation body

Discussed at plenary meeting

Approved at plenary meeting

Promulgated

Legalized by president

seats held by each party.9 A Working Committee was formed within Commission IV, which consisted of seven representatives from PDI-P,10 seven from Golkar, three from P3 (Partai Persatuan Pembangunan), two from PKB (Partai Kebangkitan Bangsa), two from the Reformasi faction (PAN–PKS, or Partai Amanat Nasional–Partai Keadilan Sejahtera), and one each from PBB (Partai Bulan Bintang) and PDU (Partai Daulat Umat). In addition, there were two members from the military (see Figure 5.2 for the formal policy network involved). A smaller group within the Working Committee negotiated closely with Kimpraswil (as the appointed government representative) in the revision of the Water Act. Members of this sub-group and Kimpraswil representatives discussed both the content and phrasing of the draft during closed-door meetings. It is telling that the involvement of other government ministries started only after the final discussion between Kimpraswil and the sub-group had occurred.

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FIGURE 5.2 Formal Policy Network for the Promulgation of the Water Act in Parliament NDPA

Kimpraswil

MoHA Government ministry

Commission IV

P3 PDI-P

F.Ref. Working Committee parliament

Political party

PKB

World Bank

Golkar

PBB

TNI

Parliamentary decision making body NGO

NGOs

PDU

International donor Formal communication

Formally, the full Working Committee approved the draft Water Act and channelled it to the formulation team in parliament for initial editorial clean-up. The edited draft act was then returned to and discussed by Commission IV in another private formal meeting. After approval of the edited version, the draft act was once more returned to the formulation team for final editing. The final version of the act was then presented at a plenary meeting. During the plenary meeting, representatives from different government ministries were invited to join the discussion, and the interested public (i.e. NGOs, donor agencies, academics) was welcome to attend and observe. After the majority of the parliament members agreed on the content of the new Water Act, the act was sent to the president11 to be signed and legalized no more than seven days after its date of approval at the plenary meeting of the parliament.

Kimpraswil’s Revision of the Draft Water Act Kimpraswil and the subgroup’s revisions of the three clauses, in comparison to the original clauses12 as formulated by Working Team IV of WTF, are summarized in Table 5.2. The first revision (Clause 41) concerned the re-installment of the central and regional governments’ decision-making authority in irrigation systems management; the word “responsibility” emphasized this authority (revised Clause 41), in contrast to the phrase “carried out” in the original version (Article 43).

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TABLE 5.2 Revised Clauses of the Draft Water Act Original draft version (27 August 2001)

Revision (30 September 2003)

Clause 43: Task redefinition

Clause 41: Task redefinition

Scope and degree of IMT depends on WUAs’ capability/ willingness to take over management of the irrigation system

Management responsibility at central and regional governments’ level

Clause 68: O&M

Clause 63: O&M

WUAs’ role: encouraged

WUAs’ role: limited to tertiary level

Clause 81: Financing

Clause 76: Financing

Focus on the co-financing possibilities between central and regional governments and WUAs

Distinct boundary of financial responsibility between central and regional governments

Implications of revisions No IMT will be implemented

Principle of one irrigation system– one management is discarded KIIF application is cancelled

Development of irrigation networks is the responsibility of central and regional governments, with the following conditions: Development of province-crossing irrigation networks is the responsibility of central government. Development of district-crossing irrigation networks is the responsibility of provincial government. Development of irrigation networks in one district area is the responsibility of district government. Development of irrigation networks is conducted by involving the local population. Development of irrigation networks can be conducted by WUAs or other parties, according to their need and capability. Guidelines about irrigation are decreed through Government Regulation (Clause 41, 20 September 2003 revision by Kimpraswil)

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Development of irrigation networks systems as mentioned in the Article 37 paragraph (2) point b is the responsibility of government and regional government and should involve the community and private sector. Development of irrigation networks system as mentioned in paragraph (1) is carried out with the following provision: Development of province-crossing irrigation networks is carried out by each related provincial governments through cooperation. Development of district-crossing irrigation networks is carried out by each related provincial governments through cooperation. Development of irrigation networks in one district area is carried out by the related district governments. Development of irrigation networks can be carried out by Water User Associations (WUAs) in accordance with their needs and capability. (Article 43, original version)

The second Kimpraswil revision (Clause 63) concerned the rejection of the one irrigation system–one management principle in the WATSAL IMT programme. In the new clause, farmers’ decision-making authority was limited to the tertiary level:13 “O&M for tertiary networks is the responsibility of WUAs” (Revised Clause 63). This was in contrast to how farmers’ involvement was promoted under WATSAL: “As far as it is possible, the community can be involved in the implementation of O&M” (Article 68). Water resources management consists of the conservation of water sources and infrastructure O&M. The implementation of O&M as it is stated in (1) includes planning, implementation, M&E [Monitoring & Evaluation] to guarantee the sustainability of the water sources. The implementation of O&M is conducted by central government and regional government, or the manager of the water source according to its jurisdictional boundary in the watershed systems. Private companies, groups or individuals who have constructed the infrastructure are responsible for the infrastructure O&M. The local population is involved in the O&M. Systems O&M is defined as follows: O&M for main system networks is the responsibility of central government and regional government, according to their respective jurisdictional boundary; O&M for tertiary networks is the responsibility of WUAs. (Clause 63, 20 September 2003, revision by Kimpraswil)

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Water resources management covers O&M and evaluation of the existing infrastructure. As far as it is possible, the community can be involved in the system O&M. Systems O&M is carried out by any legal body, business body or individual. (Article 68, original version)

The third major revision (Clause 76) concerned the elimination of the KIIF (in the original version, it was called “financial cooperation”). According to the new clause, all financial responsibility for systems management was to be assumed by the government (see Table 5.1 for the irrigation agency’s perception of IMT in relation to its access to sectoral development funds). The financial arrangement for construction and O&M is defined as follows. Central and regional governments are financially responsible for the construction, O&M of main and secondary level of the irrigation system. Farmers can be involved here. (Clause 76, 20 September 2003, revision by Kimpraswil) Financial management of the irrigation systems is borne by the community, private sector, and the government, in accordance with the obligations and responsibility, either as individuals or as a partnership cooperation. Financial management of a watershed area is decided together by the related regional government through cooperation. Regulation of financial cooperation as mentioned is decreed by Government Regulation (Article 81, original version)

The next section illustrates how the revision of these three clauses resulted in open bureaucratic conflict between Kimpraswil and the MoHA.

SECTION IV: KIMPRASWIL MORATORIUM AND RELATIONSHIP WITH OTHER MINISTRIES The policy battles over the principles of IMT started when Kimpraswil withdrew from the formulation process of a joint ministerial decree on the KIIF. The NDPA responded with a formal letter to the three ministries (Kimpraswil, MoHA, and MoF) that they proceed with this work. However,

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when Kimpraswil continued to refuse, the NDPA then urged both the MoHA and the MoF to promulgate the KIIF application guidelines within their respective ministerial decrees. In June 2003, Ministerial Decrees on the KIIF were issued by both the MoHA (Ministerial Decree Number 22 of 2003) and the MoF (Ministerial Decree Number 298 of 2003). Three months later, Kimpraswil responded by launching a second moratorium, this time on the WATSAL IMT programme itself. The chronological order of the IMT policy struggles is presented in Figure 5.3.

The Kimpraswil Moratorium The moratorium on the entire programme was announced in two ways. The first was through Kimpraswil’s formal letter dated 3 September 2003, addressed to the Coordinating Minister for Economic Affairs, the highest decision-making authority in WATSAL. A copy of the letter was also sent to the heads of the NDPA, the MoHA, the MoF, MoA, and Commission IV in parliament. According to the letter, IMT policy under WATSAL would be substantially changed in two particular areas: farmer involvement would be limited to the tertiary level and the new Water Act would be invoked as the legal basis to amend Government Regulation Number 77 of 2001 on irrigation. Kimpraswil used parliamentary decision-making authority as its “legal shield” to justify the irrigation agency’s position on the moratorium. As stated in its moratorium letter, the decision to halt IMT implementation under WATSAL was rooted in Commission IV’s objection to the degree and scope of management transfer, not theirs. Several months later, during informal meetings between Commission IV and members of the Consortium of NGOs and Universities, some Commission IV members acknowledged Kimpraswil’s domination in the parliamentary decision-making process. In one Commission IV member’s words: Most members of Commission IV are politicians. We are not water management or irrigation specialists. We would accept Kimpraswil’s explanation on almost everything. Hence, when Kimpraswil presented farmer financial incapability as the reason to limit farmer’s involvement in systems management, Commission IV members agreed to limit the scope and degree of IMT.14

According to interviews with officials from Kimpraswil in 2003, the idea to proclaim a moratorium originated from a core policy actor in Kimpraswil.

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2004

2004

2003

2003

J

F

MARCH

P

W

S

/ APRIL / MAY / JUNE / JULY /

A

F

FIGURE 5.3 The Timeline of the IMT Policy Struggles

P

F

I

S

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He presented the idea to the Kimpraswil minister as a means to restore its honour, after the issuance of both the MoF and MoHA ministerial decrees on the KIIF. From my interviews with officials at Kimpraswil, the MoHA, the MoA, and the NDPA, I learned that his motive in proposing the moratorium was actually to improve his own bureaucratic position.15 Following the moratorium letter of September 2003, the minister reshuffled bureaucratic positions in the irrigation agency and promoted this official to a more prestigious position. The moratorium was designed to send the message to the other government ministries, especially the NDPA, that the Kimpraswil had regained its sectoral decision-making authority, and more importantly, to disclose its attempt to recentralize the sector’s development. The Kimpraswil minister, Soenarno, showed his bureaucratic power to redirect the policy path in the WATSAL IMT programme in his speech during the WATSAL coordination team meeting on 3 September 2003. On the same day that the formal moratorium letter was issued, Soenarno also announced the moratorium in front of the letter recipients, as well as government representatives from the eleven ministries involved in WATSAL. When the NDPA representative questioned the moratorium,16 Soenarno accused Working Team IV of the Water Task Force of manipulating data to make it appear that the WATSAL IMT programme had been making satisfactory progress. In Soenarno’s words, according to an MoHA meeting note of 3 September 2003, members of the Working Team IV were “deceitful”.17 For Kimpraswil, the moratorium served two important purposes. First, it made clear the Kimpraswil minister’s demand for bureaucratic loyalty from all his staff (from the national down to the field level) by forcing a united stand against the WATSAL IMT programme, no matter their personal opinions. After the moratorium, the moderate policy actors in Kimpraswil, namely those who had held key positions during the IMT policy renewal in 1999 in Kimbangwil, camouflaged past involvement in the WATSAL IMT programme. Mid-level officials admitted in interviews in 2003 that they had justified past compliance with the IMT policy renewal when working on WATSAL Working Team IV by saying that other members of the Working Team and the World Bank had pressured them to make certain determinations. There was a price to pay in not lying about past actions: when one mid-level official continued to openly support the WATSAL IMT programme, he was isolated from Kimpraswil’s formal and social network.18

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Second, the moratorium cancelled the ongoing application of the KIIF. Prior to the moratorium, the KIIF had already been applied in several irrigation systems on Java in the form of a stimulant fund. After the moratorium, this fund disbursement was cancelled. The issuance of both the MoHA and the MoF ministerial decrees on the KIIF could not ensure the continuation of sectoral development fund disbursement to the district level, since disbursement was controlled by Kimpraswil. Before the moratorium, discussion on the draft Water Act was limited to Kimpraswil’s representative and members of Commission IV in parliament. After the announcement, additional segments of society (government bureaucracies, NGOs, political party forces, and environmental groups) became involved in the promulgation process of the new act. Though this wider public involvement derived from existing parliamentary procedure, I wonder whether the draft Water Act would have received much public attention, especially from policy actors and experts in the irrigation sector, had the moratorium not been made public. In October 2003, the irrigation agency disseminated the moratorium letter to the regional governments. Policy confusion now occurred not only at national level but also at regional level. The effects of the moratorium on the WATSAL IMT programme at regional and field levels are discussed in Chapter 6.

The Kimpraswil and MoHA Relationship in IMT: Bureaucratic Clash and Agreement On 8 September 2003, only five days after the announcement of Kimpraswil’s moratorium, MoHA Minister Ryam Rashid sent a joint letter of concern to Commission IV. In the letter, Rashid requested the incorporation of IMT principles under WATSAL (as described in Government Regulation Number 77 of 2001 on irrigation) into the pending Water Act. If approved, the MoHA would retain its existing involvement in the WATSAL programme (see Table 5.1 for MoHA’s interest in gaining access to sectoral development funds). The letter was signed by the head of the MoHA’s SDWR19 under the Directorate General of Regional Development, NDPA mid-level officials, and some members of the Consortium of NGOs and Universities. With reference to MoHA’s letter, the Working Committee of Commission IV decided during a meeting on the same day, 8 September 2003, to postpone the promulgation process of the new Water Act until the bureaucratic disagreement between Kimpraswil and the MoHA could be resolved. In response, on 2 October 2003, Soenarno wrote a letter to

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President Megawati Soekarnoputri, seeking her support to proceed with passage of the new Water Act, insisting that it was one of WATSAL’s policy products. To combat this move, on 13 October 2003, Rashid also sent a letter to the president reiterating the need to continue with the WATSAL IMT programme, and proposed the incorporation of IMT principles as described in Government Regulation Number 77 of 2001 into the pending Water Act. A formal letter from the president to Kimpraswil or the MoHA would have ended the bureaucratic wrangling of the two ministries, but presidential support was given to neither. In an attempt to resolve the stand-off, Kimpraswil arranged an informal meeting with the MoHA to take place on 16 October 2003. Present at this meeting were Soenarno and high officials from Kimpraswil and the Secretary General of MoHA, Siti Nurbaya (who was acting in place of Rashid’s stead). At the end of this meeting, Kimpraswil and the MoHA agreed that WUA involvement should be limited to the tertiary level, while central and regional governments remained responsible for overall systems management. The Kimpraswil–MoHA agreement was rooted in dividing sectoral development funds between the two ministries. Kimpraswil’s access to the sectoral development funds was ensured through its role in managing large-scale — greater than 4,000 hectares — irrigation systems. At the same time, the MoHA was granted access to sectoral development funds through its role in the management of small-scale — between 600 and 1,000 hectares — and medium-scale — between 1,000 and 4,000 hectares — irrigation systems. The MoHA was also entitled to allocate part of Kimpraswil’s sectoral development funds, respectively, to the district and provincial governments. The Kimpraswil minister wrote a letter to Commission IV, informing them that the bureaucratic dispute between Kimpraswil and the MoHA had been settled. It is important to note here that the Kimpraswil–MoHA agreement was made without involving MoHA’s Directorate General of Rural Development (DGRD), which would continue to oppose Kimpraswil’s attempt to recentralize the sector’s development.

SECTION V: PUBLIC CONSULTATION ABOUT THE DRAFT WATER ACT The next parliamentary meeting was scheduled for the beginning of December 2003. With the bureaucratic dispute between Kimpraswil and the MoHA resolved, Kimpraswil introduced the pending Water Act to the

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wider public in November. The SDWR (under the DGRD), on the other hand, arranged a forum to convince members of Working Committee IV to postpone the approval of the Water Act. In this section, I discuss how Kimpraswil legitimized its position on IMT through its public consultations, and how members of Working Committee IV responded to the WUA representatives’ demands during the MoHA forum.

Kimpraswil’s Public Consultation In November 2003, Kimpraswil arranged public consultation meetings in several districts on Java. These meetings were designed as discussion forums to consult with farmers on the latest version of the draft Water Act. Present during the meetings were officials from Kimpraswil, members of Working Committee and Commission IV, irrigation experts from different universities, NGO members, and farmers. In practice, these meetings were only conducted to legitimize Kimpraswil’s stance on IMT, since, conveniently, participants were limited to those aligned with the ministry or those whose actions and opinions could be manipulated. During a meeting in Solo, in central Java, the discussion between the farmers and supportive members of Working Committee focused on Kimpraswil’s alternative clauses. During the discussion on Clause 76 (on the financial arrangement), farmers learned that they could choose how to finance system maintenance; however, the new alternatives were limited: IMT would be permitted, but only if farmers’ involvement was limited to the tertiary level (see Table 5.1 regarding the irrigation agency’s interest in maintaining access to sectoral development funds). I was puzzled by the fact that only three farmers were invited to this public meeting; needless to say, these farmers were not members of the WUAs, which were fighting for more power, not less. Kimpraswil also published the pending Water Act (all 96 clauses) in the national newspaper.20 With this media blitz, Kimpraswil tried to convince less-supportive members of the Working Committee that farmers’ opinions, in particular, and public opinion, in general, would be taken into account and incorporated into the draft Water Act. As published in Kompas, opinions could be sent to Kimpraswil by email or traditional letter, addressed to the legal section in the Directorate General of Water Resources Development.

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The actual significance of this option is questionable because the line of communication was established only from the public to Kimpraswil and not vice versa. Though it was possible for anyone to offer suggestions, no further information was given on how these suggestions would be handled. Nevertheless, different organizations21 and prominent irrigation experts from Gadjah Mada University and Andalas University sent suggestions on revisions for the draft Water Act. In general, the consortium, the JKII, and the prominent irrigation experts raised the issue of farmers’ decision-making authority with respect to irrigation management, and the Indonesian Forum on Globalization (INFOG) and the Nahdatul Ulama (NU) raised concerns about the privatization of the water sector. With the exception of INFOG, no suggestions appeared in any press.

MoHA’s Forum After the Kimpraswil–MoHA agreement on the division of sectoral development funds, the DGRD in the MoHA continued its battle to halt the forward motion of the new Water Act by arranging a forum between WUA representatives and members of Working Committee in Commission IV, to be held in Surabaya on 3 and 4 December 2003. The main objective of this forum was to channel farmers’ opinions on the draft Water Act to the Working Committee by its second meeting, which was scheduled the next day, on December 5. The forum was initiated by the SDWR in the DGRD and supported by the Consortium of NGOs and Universities. The DGRD’s attempt to counteract the Kimpraswil– MoHA agreement shows that the battles over IMT were also shaped by policy actors, within and outside the central government ministries, who were willing to use IMT as a tool for bureaucratic reform (see Table 5.1 regarding the consortium’s interest in promoting IMT implementation under WATSAL). Present at the forum were regional government representatives, including from the irrigation agency at regional level; WUA members from 62 districts and 13 provinces, where the WATSAL IMT programme had already been implemented; central government officials but only from the NDPA;22 NGOs members; and three members of Working Committee and Commission IV. The first member, Ahmad23 represented the PDI-P; the second member, Bagus,24 represented P3; and the third member, Chairil, represented PAN (of the Reformasi faction).

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The DGRD’s determination to continue with IMT under WATSAL was evident in the opening speech given on 4 December by its top official: “Rules and regulations can be changed. But, the spirit of reform should be sustained, and policy reform should be continued”. He also highlighted the need to include farmers’ rights and authority in systems management in the draft Water Act, and, quite unconventionally mentioned that any policy agreement between the MoHA and Kimpraswil should not be based on their common bureaucratic interests.25 Conversely, both Ahmad and Bagus attempted to transform the forum into some sort of information channelling on the legal procedure and current proceedings around the promulgation of the new Water Act. In their opening statements, both informed the participants that the draft Water Act was about to move forward, with Ahmad announcing that “conceptually, 80 per cent of its contents had been agreed to by the Working Committee. Soon, the draft Water Act will be sent to the formulation team. After this, it will be presented and promulgated in the plenary meeting”.26 At the start of the meeting, a representative from a WUA presented their proposed changes to the draft Water Act (see Table 5.3). During the forum, this WUA representative also declared the farmers’ rejection of the present formulation of the draft Water Act. He said that they demanded the transfer of decision-making authority for irrigation management to the WUAs and stated that the WUAs perceived the draft Water Act as impediments to: the general process of reform, the principle of decentralization, the implementation of regional autonomy, and the implementation of IMT under WATSAL. In addition, he warned them that the WUAs opposed any attempt to abolish Government Regulation Number 77 of 2001. Both the WUAs’ proposed changes and demands brought forward the issue of farmers’ decision-making authority in irrigation systems management. In my opinion, this was a good starting point to discuss the IMT policy differences of Kimpraswil, members on Working Committee, the WUAs, and regional government representatives. In general, the Working Committee members did not encourage further discussion on the substantial differences in the IMT policy under WATSAL and in the draft Water Act. That was, until after hearing from the WUA representative. Ahmad then contradicted his earlier statement about the status of the draft Water Act by agreeing that the IMT policy elements under WATSAL should be incorporated into the draft Water Act,

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TABLE 5.3 WUA Proposed Changes to the Draft Water Act Kimpraswil’s version

Proposed changes by WUAs

Clause 41: • Irrigation system management: conducted by central and regional governments, involving the local population • Irrigation system management: conducted by the WUAs according to their needs and capability

• Irrigation system management: conducted by central and regional governments, together with the local population • Irrigation system management: the responsibility of central and regional governments, as well as the local population

Clause 63: • Governments: responsible for O&M at the main system level • Water users and the local population are responsible for O&M at tertiary level

Authority to implement O&M: transferred from regional governments to farmers, according to farmers’ capability

Clause 76: • Governments: responsible for financing construction, O&M activities at main and secondary levels • Governments or WUAs: responsible for financing construction and O&M activities at tertiary level

Construction and O&M activities: financed by governments and the local population, according to capability

though he did not mention if he would announce the WUAs’ demands at the parliamentary meeting. Bagus, on the other hand, continued to insist that the Water Act should be promulgated as soon possible. In his opinion, the present policy disagreements could only be solved by passage of the Water Act and he tried to focus the discussion on keeping farmers’ responsibility only at the tertiary level. This forum illustrates the actual intention of public consultations by the three members of the Working Committee. First, their presence could legitimize the committee’s decision to approve the draft Water Act, as their attendance could be spun as evidence that they based their decisions on farmers’ opinion, despite the fact that they rarely took into account any of the farmers’ demands respective of continuing with the WATSAL IMT programme. Second, the forum could appear to increase these committee members’ bargaining position vis-à-vis the conflicting parties,

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in general, and Kimpraswil, in particular. The evolution of Bagus’s role from the contact person for the Consortium of NGOs and Universities in Commission IV to his eventual alliance with Kimpraswil shows how his bargaining position increased through his active involvement in such forums. Originally, consortium members raised their voices to continue the WATSAL IMT programme through Bagus by supplying him with the information needed to support their cause. At first, he used this information to counteract Kimpraswil’s argument for the revisions of the irrigation clauses. Over time, though Bagus’s active participation in different public forums, as well as his (consortium-based) knowledge on substantial issues in irrigation, obliged Kimpraswil to include him as part of its alliance. In contrast, Chairil, the third Working Committee member, apparently acting on his own, used the forum to counteract Kimpraswil by suggesting the use of “outside forces” (i.e. demonstrations) to force Commission IV to postpone the Water Act promulgation process.27 Returning to Jakarta, the three members discovered that the second Working Committee meeting had already happened. Originally, the meeting had been scheduled for 3 December 2003 and then rescheduled for 5 December. At the last moment, however, the meeting was again rescheduled, this time for 4 December. Though the exact reason for these repeated changes remain unclear, Chairil told me that he believed that there was some connection between the schedule changes and the forum in Surabaya.

SECTION VI: THE SECOND WORKING COMMITTEE MEETING: THE EMERGENCE OF THE KIMPRASWIL–PDI-P COALITION The Working Committee approved the draft Water Act at the 4 December meeting, and sent it to the formulation team for editorial changes. Normally, the formulation team would have sent the cleaned draft to Commission IV, but, in this case, they returned it to Working Committee. Possibly, the formulation team was hinting28 that the Working Committee might once again revise the draft Water Act. However, the Working Committee simply sent the draft Water Act to Commission IV. It is important to know that, and understand how, Kimpraswil changed its agreement with MoHA to its advantage. In the final version of the draft Water Act (as approved by the Working Committee on 4 December),

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Kimpraswil had added other parameters: the administrative location, the size of the irrigation systems, and the level of government responsible for systems management. As stated in its explanation for changing Clause 41: The district government is responsible for the management of small-scale irrigation systems (smaller than 1,000 hectares) that are located within one district; the provincial government is responsible for the management of medium-scale irrigation systems (between 1,000 and 3,000 hectares) or small-scale irrigation systems that are located within two or more districts within one province; and the central government is responsible for the management of large-scale irrigation systems (larger than 3,000 hectares) or irrigation systems that are located at the interprovincial level or have a strategic function for the state. The result of these changes was that the development budget for medium-scale irrigation systems did not necessarily have to be disbursed from the central government to the MoHA; in effect, Kimpraswil was undoing the Kimpraswil–MoHA agreement of October. For example, where an irrigation system of 2,000 hectares was located within two or more provincial boundaries, the budget for the system development would be disbursed to Kimpraswil, not the MoHA. In addition, by reducing the number of hectares under medium-scale irrigation systems (from 4,000 hectares in the October agreement to 3,000 hectares in the 4 December clause revision), Kimpraswil’s development budget for the irrigation sector was increased, at the disadvantage of the MoHA’s budget. Realizing that Kimpraswil had violated the agreement, the Secretary General of the MoHA re-announced her earlier request to the Working Committee in Commission IV to revise the draft Water Act. However, this did not stop the committee from approving the 4 December version of the draft Water Act. Kimpraswil’s ability to ensure the Working Committee’s approval was related to its coalition29 with the PDI-P political party. Based on my interviews in 2003 with MoHA, NDPA, and Kimpraswil officials, as well as with Working Committee members, this coalition was represented by the relationship between the Kimpraswil minister (or his close aides) and Kharis, a representative for PDI-P and a former official from the MPW. Because of Kharis’s position on the Working Committee and on Commission IV, Soenarno could easily steer the decision-making process in the Working Committee.30 Eventually, through this relationship, Soenarno was able to extend his alliance with other political party representatives

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in Commission IV (with the exception of both the PKB and the Reformasi faction; see Figure 5.4).

SECTION VII: THE EMERGENCE OF A CONSORTIUM COUNTER-ALLIANCE After the approval of the 4 December draft of the Water Act by the Working Committee, the Consortium of NGOs and Universities attempted to build a Kimpraswil–PDI-P counter-alliance with political representatives in Commission IV through direct contact and through farmer demonstrations. Dimas,31 from the PAN political party, was the first parliament member contacted by the consortium members. He was a member of both Commission III (agriculture development) and Commission VIII (environmental development). While the consortium members were in his office, Dimas contacted some Commission IV members from within his party. One of them was Chairil, the Working Committee member who had suggested farmer demonstrations at the 4 December meeting in Surabaya. After hearing the consortium members’ explanation of Kimpraswil’s attempt to recentralize irrigation sector development, Dimas used his position in both commissions to try to halt further promulgation of the new Water Act by sending a formal letter to Commission IV, on behalf of both Commission III and Commission VIII, urging the inclusion of these two commissions in the review process of the new Water Act. Chairil agreed to suggest the postponement of promulgation of the act during an upcoming Commission IV meeting. However, he was aware that, being from the small PAN–Reformasi faction, he alone could not counteract the Kimpraswil–PDI-P coalition, so he advised the consortium members to approach representatives of other political parties in Commission IV to gather the needed political support.32 Consortium members then contacted Febri, a representative of the PKB political party, a member of Commission IV, and, most important, the head of the Working Committee in Commission IV. After hearing the plan to build a counter-alliance, he agreed to support Chairil’s proposal. Febri’s support arose from his own campaign needs to build a political relationship with two members of the consortium who were members of NU. National elections were approaching, and Febri needed these two members’ support to boost his political image. Their positions in NU would give him access

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FIGURE 5.4 Parliamentary Policy Network at the Working Committee Level first Working Committee meeting

Kimpraswil

MoHA

NDPA

P3

PDI-P PKB

Working Committee

Golkar

F.Ref.

PBB

TNI PDU

parliament

second Working Committee meeting

Infog

Kimpraswil

MoHA

NDPA TNI

DGRD-MoHA

P3

PDI-P

Consortium

Working Committee

PBB

Golkar PDU PKB F.Ref.

parliament

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Government ministry

Coalition

Political party

Formal communication

Parliamentary decision making body

Informal communication

NGO

Conflict

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to needed votes from the organization’s followers. Febri explained his development proposal for the city of Yogyakarta, one of his campaign districts. To win the election, Febri needed the support of prominent actors at the regional level, which included the two consortium members. With his own needs on the line, Febri proposed to use parliamentary procedures to postpone the act promulgation until at least April 2004, when the national election would already be underway. After April 2004, the composition of the parliament (including Commission IV and its Working Committee) would thus be changed. If the draft Water Act was not promulgated before then, the whole process would automatically have to start all over again. According to Febri, the most effective strategy to halt the draft Water Act was to continuously postpone the plenary meeting. According to parliamentary procedure, after the approval by Commission IV and editing by the formulation body, the formulation body would set a date for the plenary meeting. However, the plenary meeting could only be conducted when the parliament head received enough confirmations from the political party representatives that they would attend the plenary meeting, thus meeting the quorum quota. Febri’s strategy was to use PKB’s and Reformasi faction’s positions in parliament to continuously postpone the plenary meeting. A few days following the consortium’s visit to the parliament, counteralliance members included members from Golkar,33 a connection that was established through political manoeuvrings conducted by a mid-level official in the DGRD of the MoHA. This official first contacted George, a Golkar representative in Commission IV, to explain the situation; however, George refused to join the counter-alliance, claiming that the new Water Act would be promulgated soon. The mid-level official then contacted Haris, another Golkar representative. Upon hearing the postponement request, Haris told him that George needed to be contacted, as he was the leading representative of Golkar in Commission IV. The MoHA official explained his failure to convince George; to get Haris on his side, he mentioned George’s relationship with the PDI-P, dropping the possibility that he might have been “bought” by Kimpraswil or the PDI-P. In this way, he intensified the political tension of PDI-P and Golkar as the two major competitors in the upcoming national election. Haris remained unconvinced until he was reminded of the WUAs’ importance in terms of the number of votes they could deliver in the next national election. Given that each WUA consisted of, on average, 50 farmers with more than 5,000

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WUAs, any political party that could strategically use the struggles over IMT to win farmers’ votes could gain around 250,000 votes, not including family members. In addition, the mid-level official “suggested” he could just as easily present his idea to other political parties and even bluffed that he had already been offered a position in another political party. Out of fear that the WUAs’ votes might go to any other political party, Haris immediately called Iwan, the head of Golkar at that time who instructed Jeffry, the vice secretary of Golkar to meet Haris and this mid-level official. At that meeting, which occurred shortly thereafter, Jeffry was supplied with data on the WUAs; later that same day, Haris confirmed that Golkar would join the alliance to postpone the promulgation of the new Water Act. With this confirmation, the coalition between Golkar–PAN/Reformasi faction–PKB was established, just a few days before the scheduled 17 December Commission IV meeting (discussed below). The development of the different coalitions in Commission IV is presented in Figure 5.5. Along with directly approaching different political party representatives, consortium members arranged a WUA farmer demonstration in West Java to exercise political pressure on Commission IV to postpone the promulgation process (even though a decision on the December 4 draft Water Act had been delayed in the December 17 Commission IV meeting). The date of the demonstration had been planned for 19 December, two days after the Commission IV meeting. Nevertheless, consortium members did not see any reason to cancel the demonstration in Java, as it would still highlight the importance of the WATSAL IMT programme for farmers. Due to the limited budget for the demonstration, which was being financed by members’ contributions, the consortium decided that the demonstration would only involve West Java WUA representatives, not farmers. In the early morning hours of 19 December 2003, approximately sixty WUA representatives gathered in front of the parliament grounds in Jakarta. While waiting for permission to meet Commission IV members, some of the representatives orated on the importance of the WATSAL IMT programme for farmers. Others held aloft their leaflets and posters, pressing their demand for the revision of the 4 December version of the draft Water Act. It was noon before they were allowed to enter the parliament grounds to meet Commission IV members — the complicated procedure involved in obtaining permission to meet Commission IV members clarifies the importance of political connections.34 The official in the public relations office allowed only three WUA representatives to enter the parliament

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FIGURE 5.5 Parliamentary Policy Network at the First Commission IV Meeting

MoHA

Kimpraswil

DGRD-MoHA

PDI-P Commission IV

TNI

P3 PBB PDU

PKB

Golkar F.Ref. parliament

Infog WALHI

Political party Parliamentary decision making body

Commission III Consortium Commission VIII

Government ministry

NGO Coalition Formal communication Informal communication

grounds, but after a fierce discussion between the demonstration leader and this official, a total of thirty WUA representatives were allowed to meet Commission IV members. These WUA representatives were counted by a security officer before being escorted35 to the meeting room by a police officer. The other WUA representatives waited in front of the main gate. In the meeting room, the WUA representatives were greeted by a few Commission IV officials: members from PAN/Faction Reformasi, from P3, from PBB, from PDI-P, and a former military general. The WUA representatives urged these Commission IV members to postpone any decision on the Water Act to revise the three controversial clauses on irrigation: Clauses 41, 63, and 76. One of the WUA representatives presented how the WATSAL IMT programme had empowered farmers: “With the WATSAL IMT programme, WUAs are able to conduct systems rehabilitation by themselves”.36 He also mentioned that, in the past, his West Java WUA had raised as much as Rp50 million (equal to US$5,000) to finance needed rehabilitation.

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Farmers’ opinions of their own managerial abilities did not change Commission IV members’ perceptions. Edi,37 from PAN/Faction Reformasi, insisted that farmers’ decision-making authority should be limited to the tertiary level, and Nono, from the PBB, agreed that the government should remain responsible for systems management at main and secondary levels, saying: “Perhaps in West Java farmers were able to take over systems management. But this did not automatically apply to farmers outside Java”. The representative from the military faction reiterated a populist proposal that the government should remain financially responsible for all systems management, including at the tertiary level, as farmers should not be burdened with the high costs of irrigation O&M.38 Conversely, Beni, from P3, agreed to the WUAs’ demands: “I understand the spirit that has developed among farmers. Therefore, I do not have any objection to the proposal to postpone the promulgation of the new Water Act”.39 He said that he would fight to ensure the inclusion of farmers’ aspirations in the formulation of the new Water Act.

The First Commission IV Meeting: The Emergence of Counter-Political Forces in Parliamentary Decision Making Present in the Commission IV meeting on 17 December were representatives from the seven political parties: the military; high-level officials from Kimpraswil, including Soenarno; government representatives from the MoHA, the MoA, and other sectoral ministries;40 prominent NGOs; and the counter-alliance. In the meeting, the seven political parties and the military faction would decide on the promulgation status of the draft Water Act. If Commission IV approved the December 4 draft act, it would be channelled to the plenary meeting. If they did not approve it, the act would be discussed in a second Commission IV meeting. The meeting, originally scheduled for 9 a.m., was postponed until 10 a.m. and then again until 11 a.m. because of there was not a quorum of political party representation. In between the first and second postponements, the head of Working Committee asked the lead representative of each political party to meet separately. Shortly after the private meeting, the Commission IV meeting to discuss the revised Water Act was called to order by the head of Commission IV, who was from the PDI-P party. Against Kimpraswil’s expectations, Commission IV ruled to postpone the process until a second Commission IV meeting having decided

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that the wider public must first be consulted about the act. Kharis, the representative from PDI-P who was also Kimpraswil’s key actor, inquired about the timeframe for the proposed public consultation. Surprisingly, the head of Commission IV closed the meeting without addressing this question. Officials from the MoHA, the counter-alliance, and NGOs welcomed the delay. The second Commission IV meeting was scheduled to take place around mid- January 2004, after the second parliamentary recess. The reason behind the delay was announced in the national newspaper the next day.41 It was reported that, according to the leader of the Working Committee (from the PKB) and the vice head of Commission IV (from Golkar), the decision to postpone discussion of the new Water Act was based on objection letters from both Commissions III and VIII. Ari, as the head of Commission III, confirmed that he had sent a letter proposing that Commission IV include Commissions III and VII in the promulgation process, and Dodi, the head of Commission VIII (from Golkar), confirmed that he formally proposed that the promulgation process be tackled at the intercommission level. With the establishment of a political coalition between Golkar, PAN/ Reformasi, and PKB political parties, the Kimpraswil–PDI-P coalition could no longer steer the decision-making process. Clearly, the game plan was linked to Dimas’s earlier idea of postponing the promulgation of the draft act by including both Commissions III and VIII in the process. Heeding the mandated instruction to conduct public consultations on the draft Water Act, Kimpraswil sent a formal letter on 22 December to the eleven government ministries asking for suggestions on the existing formulation of the 4 December draft Water Act. The caveat: suggestions had to be sent to Kimpraswil before the end of the month, leaving only nine days to meet and to create a response during the holiday season. In addition to leaving no time for true discussion, in contradiction to the meeting’s true outcome, Kimpraswil claimed in the letter that discussions on the contents of the draft Water Act had been completed. Two days later, on December 24,42 the MoHA minister sent a formal letter to Kimpraswil with proposed suggestions, including that sector development should be focused on farmer empowerment and that the content of the draft Water Act should reflect the principle of decentralization and democratization. Proposed changes to Clauses 41, 64, and 78 were included in the letter’s appendix.

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On 31 December, the 4 December version of the draft Water Act, including an explanatory section, was published in the newspaper.43 None of MoHA’s suggestions were included in this version of the draft act.

SECTION VIII: THE RE-OCCURRENCE OF BUREAUCRATIC CONFLICTS On 5 January 2004, the Directorate of Irrigation and Water Resources (DIWR) of the NDPA announced a national seminar on irrigation development, scheduled for 12 January. The seminar’s title was National Strategy to Increase the Level of Wealth in Farming Households. Included in the long list of seminar participants were representatives from different government ministries, regional governments, NGOs, university academics, WUA representatives, and foreign donor organizations. With this seminar, the DIWR (and the NDPA overall) was attempting to launch a national movement on IMT. As planned, an inter-ministerial coalition would be formed to counteract Kimpraswil’s recentralization efforts (see Table 5.1 for NDPA’s interest in regaining inter-sectoral decisionmaking authority). The DIWR engineered formal support for the IMT movement by prematurely announcing that none other than president Megawati Soekarnoputri would deliver the keynote address. However, only two days later, a formal letter from the NDPA announced the cancellation of the seminar. In that two-day period, the Kimpraswil minister had sent his Directorate General of Water Resources Development to convince the DIWR leader to cancel the seminar. When the DIWR leader refused, the minister himself approached the head of the NDPA. Whatever happened in that meeting, the end result was that the head of NDPA cancelled the meeting and the DIWR leader was forced to resign.44 The exact reasons behind the seminar cancellation were never formally acknowledged, though according to interviewees at the NDPA and MoHA in 2003, it was cancelled due to several circumstances. First, the NDPA could not identify a main funder for the seminar. Initially, the NDPA assumed that the seminar would be funded by Kimpraswil, given Commission IV’s instructions to gather public opinion. Upon Kimpraswil objection to the entire seminar, however, another main funder had to be found.45 Second, the seminar had been poorly prepared due to its spontaneous creation. According to the NDPA and MoHA interviewees, one week before the seminar, none of the international speakers had confirmed their availability

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or even their willingness to present at the seminar. Worse, when the head of the NDPA checked the president’s monthly work schedule, he discovered that she would not even be in the country on the day of the seminar. The MoHA had also arranged a national seminar to counteract Kimpraswil’s position on IMT and that seminar was also cancelled. The reason for this cancellation lies in the unresolved disagreement between the MoHA’s Director General of the DGRD and its Secretary General. Although both leaders wanted to take credit if the seminar was a success, neither was willing to take the risk of losing their position if the seminar turned into a catastrophe (as happened with the NDPA seminar). The idea for the MoHA national seminar came from the Secretary General, but she intended to make the DGRD host it: if it was successful, she would get the credit as her idea. But since it was the Director General of DGRD who would have to deal with possible negative bureaucratic fallout, he refused to host it. The cancellation of both seminars effectively ended all bureaucratic disputes over the principles of IMT policy.

SECTION IX: BACK TO PARLIAMENT With the cancellation of the seminars, the policy struggles once again returned to the domain of Commission IV. With Commission IV’s 17 December decision to postpone discussion on draft Water Act, members of the Consortium of NGOs and Universities continued to strengthen their coalition in parliament by approaching representatives from PKB, P3, and PAN. On 30 January 2004, the consortium members revisited Bagus, of P3, who had been a member at the 3 and 4 December 2003 meetings in Surabaya. Bagus explained that substantial changes could no longer be made to the existing draft Water Act because Commission IV would not repeat the entire legal procedure required for act promulgation. In his opinion, neither Commission IV nor its Working Committee could solve the present polemics because the problem was rooted in the sectoral egoisms in the different government ministries. He mentioned, as an example, that discussions and negotiations between government ministries always centred on their access to the development budget. While this may be true, Bagus hid his self-interest to be part of Kimpraswil–PDI-P alliance by then blaming Commission IV members’ ignorance of the issues, saying: “The way the negotiation was conducted between members of parliament

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and officials from the government agency is comparable to a football match between the village team and the national team of Brazil. Hence, Kimpraswil could steer the parliamentary discussion, such that its end product would represent only the agency’s interest”.46 Failing to get Bagus on their side, consortium members approached representatives of the PAN/Reformasi faction and were able to meet with Oki, the party secretary. The issue of farmers’ decision-making authority versus Kimpraswil’s attempt to redirect irrigation development towards recentralization was raised, as was Kimpraswil’s violation of the public consultation requirement. Oki informed the consortium that the draft Water Act would be approved during the second Commission IV meeting and sent directly to the plenary meeting, not to the formulation committee. Nevertheless, he would try his best to stop the process, even knowing that powerful forces outside parliament had directed the promulgation process of the new Water Act. Members of Commission IV, in general, and Chairil and Edi, in particular, had repeatedly informed him about the difficulty of changing anything in the act formulation.

The Second Commission IV Meeting: Reformasi Faction’s Strategy The second Commission IV meeting occurred on 11 February 2004, attended by members of Commission IV; representatives from the seven political parties; members from the military and from the NGOs; and a handful of journalists from the national media. Also present in the meeting was Soenarno, accompanied by officials from the irrigation agency, including the Director General of Water Resources Development, Secretary General, and Inspector General; retired high officials from the irrigation agency; and key actors from the MoHA and the NDPA. After a ceremonial introduction, Febri, the head of the Working Committee, informed the participants that the meeting would largely focus on the PAN/Reformasi faction’s proposal to revise the draft Water Act. Except for the PAN/Reformasi faction, the existing draft Water Act had been agreed to by all the other representatives of the political parties. Febri presented the main discussion points in the draft Water Act: management of drinking water, privatization involving water export to other countries, and the financial issue of maintenance and construction of irrigation infrastructure at the tertiary level. Surprisingly, the issue of

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farmers’ decision-making authority in irrigation systems management was not mentioned at all. Chairil presented the PAN/Reformasi faction’s proposal, which centred on the reformulation of Clauses 29 (Section 3) and 40 (Section 3). With regard to Clause 29, the proposal was to add the word “irrigation” into “water supply for basic needs”. For Clause 40, the proposed change was the role of the cooperatives in water management. The opinions of each political party and the military faction representatives on the proposed changes are presented in Tables 5.4 and 5.5. After the presentation, the Kimpraswil minister announced his agreement to the proposed changes to the clauses, including his proposal to empower cooperatives. Based on the changes involving cooperatives, Edi (PAN/Reformasi) proposed the postponement of the promulgation of the draft Water Act. Some members of Commission IV said quickly that it could no longer be postponed. According to these members, Commission IV had already decided to approve the draft Water Act and to channel it to the plenary meeting. Edi insisted that he would make the same postponement proposition to the plenary meeting. At this point, George (Golkar) expressed his support for Edi’s proposal, causing chaos to erupt in the meeting room. Bagus (from P3) insisted that the new Water Act should be promulgated at this meeting, to which Febri attempted to adjourn the meeting. Representatives from PDI-P proposed a temporarily adjournment, suggesting that they reconvene after lunch. After lunch, the meeting reopened with Edi withdrawing his proposal for postponement; representatives from PDI-P, P3, and the military faction congratulated him on the decision. Following this withdrawal, Commission IV approved47 the draft Water Act and sent it directly to the head of the parliament to be scheduled for a plenary meeting. I assume that Edi was forced to withdraw his postponement request following the informal decision-making rules at parliament, based mainly on back-door agreements, rather than transparent processes. The combination of both Chairil’s and Edi’s proposals (to revise the draft Water Act and to postpone the act promulgation, respectively) almost enabled the PAN/Reformasi faction to break the Kimpraswil–PDI-P line of defence at this meeting.48 Chairil’s proposal was essential in promoting an open discussion during the meeting, thereby creating space for Edi to propose another delay. Edi’s proposal then allowed PAN/Reformasi faction allies (PKB and Golkar) to direct the discussion to halting the promulgation

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TABLE 5.4 Proposed Changes to Clause 29, Section 3 by Political Parties PAN/Reformasi:

Section 3, Clause 29: Water supply for basic needs and irrigation.

PDI-P

Priority: water use for irrigation above the drinking water supply.

Golkar

Distinction should be made to the definition of basic needs in relation to water.

P3

Priority: defined between water use for drinking and for irrigation.

PKB

Priority: water use for irrigation.

PBB

Priority: defined between water use for drinking and for irrigation, but since the distinction may have implications in the field, Clause 29 could be left as is.

PDU

Leave as is.

Military faction

Leave as is.

TABLE 5.5 Proposed Changes to Clause 40, Section 3 by Political Parties PAN/Reformasi

Section 3, Clause 40: Cooperatives, government financial institutions, private companies, and the local population can be involved in the drinking water systems development.

PDI-P

Agrees with Kimpraswil that cooperatives should be empowered.

Golkar

Agrees with Kimpraswil.

P3

Leave as is.

PKB

Leave as is.

PBB

Leave as is.

PDU

Agrees with Kimpraswil.

Military faction

Leave as is.

process of the draft Water Act. With Golkar’s support for Edi’s proposal, the committee was forced to take this proposal under consideration instead of immediately dismissing it. If Febri’s attempt to close the meeting had not been impeded by a representative from PDI-P, the promulgation process would have been halted for a second time. With the impediment washed away, the actors in the counter-alliance did their best to derail immediate passage of the draft Water Act.

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One other tactic should be mentioned. According to parliamentary procedures, changes proposed by political party representatives on the existing formulation of the 4 December draft Water Act were to be delivered to Commission IV before the meeting date. Prior to the 11 February Commission IV meeting, Chairil sent a watered-down version of his proposal to the commission, which was discussed with commission members and Kimpraswil in their final consultation meeting on 9 February 2004. In that meeting, both Kimpraswil and Commission IV members decided to review the proposed changes at the Commission IV meeting. Chairil’s strategy to propose uncontroversial changes to Clauses 29 and 40 prior to the meeting was important in reducing Kimpraswil’s awareness of the formation of the counter-alliance at Commission IV. Had the more serious revisions to the controversial clauses (regarding which organizations would hold financial responsibility) been included in Chairil’s pre-meeting proposal, I doubt that the changes would have been discussed at the Commission IV meeting.49 The coalition map during the Commission IV’s second meeting is presented in Figure 5.6. FIGURE 5.6 Parliamentary Policy Network at the Second Commission IV Meeting MoHA DGRD-MoHA

Kimpraswil

PDI-P Commission IV

TNI

P3 PBB PDU

PKB

Golkar F.Ref. parliament

Infog WALHI

Government ministry Political party Parliamentary decision making body

Consortium

NGO Coalition Formal communication Informal communication

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The Plenary Meeting: The Outcome of the Policy Struggles The plenary meeting on the draft Water Act was held on 19 February 2004. Present during the meeting were members of Commission IV; representatives from political parties, parliamentary members, government ministries, and NGOs; and people from the national media. The head of parliament, Romi (from PAN/Reformasi faction), opened the meeting. He declared that the new Water Act would be announced during this meeting. A member from Commission III said that the status of the draft act should not be announced before the opinions from each political party were presented publicly and inquired about the letter from Commissions III and VII that requested their inclusion in the promulgation process of the draft Water Act. Romi announced his successful lobbying of the heads of both Commissions III and VIII, both of whom were now agreeable to the decision made by Commission IV. Before the opinions of the political party representatives were presented, Anwar, the head of Commission IV, again informed the participants that the new Water Act would be announced at this meeting, adding that a new government regulation would also be immediately issued. Romi asked Golkar’s representatives to declare their formal position on the draft Water Act. The same request was made of representatives from P3, PKB, PAN/Reformasi faction, the military faction, PBB, KKI, PDU, and PDI-P. Apart from the PAN/Reformasi faction’s objection and PKB’s abstention, the other political parties agreed on the existing formulation of the draft Water Act. After the formal presentations, the plenary meeting was temporarily halted so that representatives from each political party and the military faction could discuss their final decision on the draft Water Act in an internal meeting. Twenty minutes later, Romi announced that the new Water Act had passed. A member from the PAN/Reformasi faction interrupted, saying that this was not what he had understood; according to him, they had agreed to vote for the final decision on the status of the draft Water Act. Though PAN/Reformasi faction members were outnumbered in Commission IV, voting at the plenary meeting did not rule out their chance of defeating the dominant coalition. Voting at the plenary meeting involved all present members of the parliament, provided there was a quorum, but given that this was not met at this meeting, PAN/Reformasi faction’s representatives expected that the meeting would be suspended. Chaos erupted. Apparently

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someone then turned off the microphones in the room, microphones that were attached to each member’s chair and used when making a statement or raising concerns during the formal meeting. A member from PDI-P shouted that Romi should read aloud the decision that had been made during the internal meeting. Surprisingly, Romi declined to do so. More than five parliament members raised their hands, which went ignored. Romi immediately promulgated the new Water Act, and then turned the floor over to Soenarno. Nine members from the PAN/Reformasi faction stormed out in protest before he even started his speech. There was immediate widespread criticism of and attack on the Water Act’s controversial contents. On February 19, the same date that the draft Water Act was approved, the JKII delivered a legal appeal, under the name of a West Java WUA, to the public court in Jakarta. For no known reason, the court rejected the appeal. On 7 March 2004, sixteen NGOs jointly proposed a judicial review of the new Water Act.50 The legal procedure for judicial review was started on 8 March, but after constant coverage in the media, the Judicial Court declined to review the new Water Act.51 None of this halted criticisms, mainly on privatization issues.52 On 22 March 2004, the JKII arranged a one-day seminar — with policy actors from different government ministries, NGOs leaders, and retired officials from the former MPW — meant to convince the core policy actors in Kimpraswil to change their sectoral approach. While this seminar was convened, unlike the other seminars that had been squashed, it did not result in resolution of the controversial issues of the draft Water Act, which was the scope and degree of IMT policy. The decision to pass the draft Water Act at the plenary meeting was shaped by different layers of convoluted political interrelationships, both between and in political parties, and through individual positions. Kimpraswil’s strategy at the plenary meeting focused on its relationship with Romi, as the head of parliament. Kimpraswil recruited him as part of its alliance because he could intervene and direct the decision-making process in the plenary meeting to serve Kimpraswil’s purpose, regardless of his status as a member of the PAN/Reformasi faction. Another shift that occurred was a change in Golkar’s allegiance from the PAN/Reformasi–PKB coalition to the Kimpraswil–PDI-P–P3 coalition, which was directly related to the formation of the Golkar–PDI-P coalition around January 2004. On 22 February 2004, just three days after the passage of the new Water Act, Golkar’s leader, Iwan, announced the

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coalition between Golkar and PDI-P, in time for the April 2004 national election.53 This announcement came out less than a week after Iwan’s trial, in which he was cleared of all corruption charges related to his involvement with the New Order government. The provincial court had found him guilty, which moved the case to the Judicial Court.54 I am inclined to think that the coalition between Golkar and PDI-P was the most logical step for Iwan, as his alliance with PDI-P could automatically solve his legal problems: as the current ruling political party, PDI-P could lobby the Judicial Court on Iwan’s behalf. In turn, Golkar’s decision to join the PDI-P–Kimpraswil coalition significantly reduced the PAN/Reformasi faction’s ability to counteract Kimpraswil’s strategy in the plenary meeting. The faction’s position in parliament (as the fourth or fifth largest political party) was not sufficient to act as a counterforce, even with partial support from Golkar through George. The establishment of the different coalitions at the plenary meeting is presented in Figure 5.7. FIGURE 5.7 Parliamentary Policy Network at the Plenary Meeting

Kimpraswil

MoHA

PDI-P Head of Parliament

TNI

P3 PBB PDU

Golkar Government ministry

F.Ref.

PKB

parliament

Infog WALHI

Commission III Consortium Commission VIII

Political party Parliamentary decision making body NGO Coalition Formal communication Informal communication

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Before the Second Commission IV Meeting On 10 February 2004, one day before the second Commission IV meeting, an informal meeting between Kimpraswil officials and members of the consortium was arranged by Febri. The private meeting was conducted at a five-star hotel, where it would be hard to know if a meeting was taking place. Present were members of the consortium, mid-level officials from Kimpraswil, and Febri. Kimpraswil officials’ and the consortium members’ conflicting perceptions on IMT and farmers’ decision-making authority in systems management were evident during the entire course of the meeting, which lasted for almost five hours. Kimpraswil officials insisted that decision-making authority for irrigation systems management should remain in the hands of the central and regional governments. Consortium members, on the other hand, proposed that farmers should be involved in the decision-making process in relation to the sector’s development. Reacting to this proposal, Kimpraswil officials said that if farmers were to be given decision-making authority to manage irrigation systems, they should also be financially in charge to manage the irrigation systems. Consortium members retorted that government should be committed to empower farmers instead of demanding their financial contribution towards systems management. Kimpraswil officials also insisted that the principle of one irrigation system–one management in the WATSAL IMT programme should no longer be applied. As far as large-scale irrigation systems were concerned, they argued that the WUAs could not be held responsible to finance the overall systems management. Consortium members rejoined that this alone should not justify limiting farmers’ involvement to the tertiary level: large-scale irrigation systems form less than 30 per cent of the total irrigation systems in Indonesia, leaving another 70 per cent outside that description. Despite these arguments, Kimpraswil officials insisted that they would not incorporate the proposals increasing WUAs’ responsibility into the final formulation of the draft Water Act. When consortium members asked Kimpraswil officials to note their proposals, they refused.55 Because Febri was not in the room at the time, consortium members stopped the meeting until his return. Once he was back in the room, Kimpraswil officials complained to Febri that the discussion had been halted due to disagreements on the formulation issue. Consortium members then complained about

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the Kimpraswil officials’ unwillingness to formally write down their suggestions on farmer participation. Febri announced that since the meeting was not constructive, differences might be best resolved at the plenary meeting. He did instruct Kimpraswil officials to write down the suggestions (knowing that these documents could be used, in addition to the suggestions of the PAN/Reformasi faction for the formal meeting in Commission IV the next day). Consortium members asked Febri about the possibility of incorporating their proposed changes into the existing formulation of the draft Water Act; he answered that it depended on the decision made at the Commission IV meeting the next day, though he thought it might not too late to include some of the proposals. He explained that even if Commission IV approved the formulation of the draft Water Act, suggestions to improve the draft act could still be channelled to the plenary meeting, as nobody could predict the decision beforehand.56 At the end of this meeting, not a single agreement was reached between Kimpraswil and the consortium members, which explains why not a single point was raised during the Commission IV meeting on the following day.

SECTION X: THE KIMPRASWIL–WORLD BANK RELATIONSHIP The World Bank was fully informed about Kimpraswil’s attempt to redirect the policy path in the WATSAL IMT programme. In a memo dated 3 June 2003, the World Bank advised the Government of Indonesia (GOI) to avoid any revision of the two key points in WATSAL: the Ministerial Decrees on the KIIF and the Government Regulation on Irrigation57 (see Table 5.1 for the Bank’s interest in promoting “good governance”). This memo was a response to Kimpraswil’s withdrawal from the process of writing the joint ministerial decree, as discussed above. On 19 November 2003, in responding to Kimpraswil’s moratorium, the World Bank wrote a letter58 to the NDPA, demanding the GOI’s confirmation of its position on the continuation of the WATSAL IMT programme. As stated in the letter: “The Bank would greatly appreciate receiv[ing] confirmation of the government’s commitment to its irrigation policy reform, and to the regulations it already has issued”. The Bank recommended that the GOI

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“ensure that it has a unified and consistent position on its sector policy, particularly where it concerns irrigation management”.59 On 28 May 2004, the NDPA wrote a letter to the World Bank, stating that Kimpraswil, the NDPA, and the MoHA had reached an agreement on the key principles of IMT as defined in the new Water Act (see Table 5.6 for the position of the government to IMT policy principles, as defined in the LoSP 1999, vis-à-vis the new Water Act). Because of the GOI’s position on IMT, the World Bank decided to stop the third tranche of fund disbursement in mid-2004. In late 2005, however, the World Bank started a new programme, the Water Resources and

TABLE 5.6 GOI’s Position on IMT in 2004 after Kimpraswil’s Withdrawal from WATSAL Key issues

Stated in the memo

GOI’s decision

Roles of WUAs in O&M and water allocation

WUAs: partner of local and national government in O&M

WUAs: responsible for O&M at the tertiary level; may be involved in O&M for primary and secondary level of irrigation systems

WUAs organizational structure

Water users: will set up WUAs at tertiary level, which will confederate to secondary level, up to higher system level

WUAs: should be established within the tertiary level; could also be formed at primary and secondary levels according to needs and capacity

Delegation of irrigation management responsibility

Government: establishes an MoU* with the WUAs in the irrigation system, prior to actual IMT, up to the system level

Secondary and primary level systems management: responsibility of central and regional governments. WUAs may participate in management of primary and secondary irrigation systems based on willingness and capability

KIIF

Government: create a financial mechanism to allow direct funds transfer to WUAs with sound technical proposal

Abolition of the MoF ministerial decree on the KIIF; new KIIF is not a fund transferred directly to the WUAs

Notes: * MoU, Memorandum of Understanding.

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Irrigation Sector Management Program, or WISMP, which was originally designed as the follow-up to WATSAL. It will be interesting to see how the WATSAL IMT programme will fare under WISMP. So far the results have been that both the MoHA and the NDPA have agreed to support Kimpraswil’s IMT programme under WISMP, because it gives them access to project funds.

CONCLUSION There were several factors that spawned conflict with the WATSAL IMT programme. First, there was resistance to the programme from within the irrigation agency, because the needed internal reform of the irrigation agency was not considered when the WATSAL programme was first created. Second, the WATSAL policy-makers’ strategy during IMT renewal was to exclude the agency’s core policy actors from the overall process, but this limited the role of pro-reform government officials in the irrigation agency (1) to accelerating the formulation process of IMT legal frameworks and (2) to blocking IMT policy information from the Kimpraswil minister. In the early stage of IMT policy renewal, this twopronged strategy proved to be effective. The newly appointed Kimpraswil minister did not resist the promulgation of either the government regulation on irrigation or the ministerial decree on IMT guidelines as part of IMT legal framework, not to mention that the KIIF was already being applied in several irrigation systems on Java, prior to both the MoHA and the MoF ministerial decrees on the KIIF. However, with the re-emergence of the core policy actors, the information barrier to the minister was removed. The outcome of the IMT policy battles at the national level was shaped by the increasingly complex policy networks, represented by the dynamic alliances between policy actors and (non-)government institutions clustered around the promulgation process of the new Water Act. The formation of coalitions and counter-coalitions in both Commission IV and its Working Committee were linked to the strategies used by the different alliances to influence the decision-making process in parliament. As detailed above, the counter-coalition in Commission IV was formed when both the MoHA’s SDWR of the DGRD and the members of the Consortium of NGOs and Universities approached parliament members.

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This coalition and counter-coalition served dual purposes, as they were also created out of political need surrounding the 24 April national election. Febri’s decision to act as the Consortium of NGOs and Universities’ contact person was directly related to his strategy to use two consortium members’ political connections to strengthen his chances of winning in the election. The decisions made by the Golkar political party to join the PAN/Reformasi faction–PKB coalition during the first Commission IV meeting but to then join forces with the Kimpraswil–PDI-P–P3 coalition during the second Commission IV meeting were directly linked to its strategies to win the election. The overall alliance formation, however, was most closely linked to the distribution of sectoral development funds between the different government ministries. Access to sectoral development funds was at the foundation of every policy actors’ action.60 Consequently, policy actors’ perceptions on IMT policy as formulated under WATSAL, and later reformulated in the Kimpraswil-revised draft Water Act, were based on their interest in gaining access to money, that is, the sectoral development funds. For instance, MoHA’s positioning of itself as the second government agency responsible for the implementation of the WATSAL IMT programme, after Kimpraswil was based on its motivation to protect its access to the sectoral development funds through its NewISF programme, which would have been eliminated if the WATSAL IMT programme was reformulated to fit Kimpraswil’s recentralization of the irrigation sector’s development. Sectoral funds have made recent allies of the MoHA and NDPA with Kimpraswil, as long as Kimpraswil’s IMT in the WISMP continues to offer them access to project funds. The practice of money politics and pork barrel deals in both Commission IV and its Working Committee reveals the characteristic of the new Water Act as a political commodity. According to some members of Commission IV, a considerable amount of money was involved in the promulgation process of the Kimpraswil-driven Water Act. It is worth noting that the amount of money (US$150 million) coincided with the exact amount of WATSAL’s third tranche disbursement. Kimpraswil’s power is clear in its domination of the parliamentary decision-making process: pro-reform members of Commission IV and the Working Committee members could not force Kimpraswil to even discuss the controversial clauses in the draft Water Act in either formal policy meetings in parliament or in informal back-room dealings.

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Financial interests and resources became the main forces that shaped the negotiation process, as access to parliamentary decision making was traded for access to financial resources, and vice versa. Individual members of Working Committee and Commission IV never had any intention of resolving the disagreements in the scope and degree of IMT, as their positions in the promulgation process directly related to their individual interests in increasing either funding resources and/or political connections for their election campaigns. Other members treated substantial policy issues such as farmers’ willingness and ability to run systems management as political tools for personal political gain. This was evident in how Bagus strategically used his role as the Consortium of NGOs and Universities’ contact person in the Working Committee to move into an alliance with Kimpraswil. Rules of the game were developed as needed to control (or try to control) the formal procedure for Water Act promulgation in parliament. Both the Working Committee and Commission IV members changed tactics, depending on the situation. For instance, Febri stated that to halt the channelling of the draft Water Act to the plenary meeting, the requirement of public consultation on the draft Water Act could no longer be the reason given to postpone the promulgation process since that had already been used in December 2003, so he shifted his tact to proposing the quorum regulation. Changing times called for changing behaviours. After all the IMT policy battles, and with all the many players involved, Kimpraswil seems to have successfully neutralized WATSAL reform efforts at the national level. The next chapter discusses how the neutralization of these policy struggles was translated at both provincial and district levels.

Notes   1. M. Rein and D. Schön, “Reframing Policy Discourse”, in The Argumentative Turn in Policy Analysis and Planning, edited by F. Fischer and J. Forester (Durham, NC: Duke University Press, 1993).  2. Vedi R. Hadiz, “Decentralization and Democracy in Indonesia: A Critique of Neo-Institutionalist Perspective”, Working Paper Series No. 47, Southeast Asian Research Centre. (Hong Kong: City University of Hong Kong, 2003); S. Haris, Desentralisasi dan Otonomi Daerah: Desentralisasi, Demokratisasi, dan

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  3.   4.   5.   6.   7.   8.

  9.

10. 11.

12. 13.

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Akuntabilitas Pemerintahan Daerah [Decentralization and Regional Autonomy: Decentralization, Democratization and Regional Government Accountability] (Jakarta: LIPI Press, 2005). Rein and Schön, “Reframing Policy Discourse”. Ibid., p. 148. This included officials from the NDPA, the MoHA, and Kimpraswil, but mostly from members of the consortium. The Sub-Division of Water Resources, under the Directorate General of Regional Development in the MoHA, had been appointed as the second government agency responsible for IMT implementation, after Kimpraswil. This was one of the NDPA mid-level officials who had proposed the incorporation of IMT into the regional autonomy policies. These two NGO representatives from respectively the Institute for Social and Economic Research, Education and Information (LP3ES) and the Secretariat for Forest Conservation in Indonesia (SKEPHI) were both members of the Consortium of NGOs and Universities. Apart from PDI-P, Golkar, and P3, which existed during Suharto’s New Order government, the remaining political parties were formed only shortly after the political reform in 1998. PKB is the political party of former president Abdurrachman Wahid, and it has close ties with the Nahdatul Ulama, the largest Indonesian grass-roots level Muslim organization. The Reformasi faction consists of the PAN and PKS political parties. A faction is formed when two or more political parties join together, namely those that do not have enough parliamentary seats to be represented on their own. Both PAN and PKS have strong ties with the Muhammadiyah, one of the largest Muslim organizations in Indonesia. By 2003, however, PAN, PKB, and PKS were considered by many to be opposition wings of one another in the Indonesian parliament. Two other parties, the PBB and the PDU, are religion-based political parties. From large to small, the political parties are: PDI-P, Golkar, P3, PKB, Reformasi faction, PBB, and PDU. As the ruling political party at that time, PDI-P representatives formed a majority in both Commission IV and its Working Committee. If the president does not sign and legalize an approved act within 15 days after its date of approval, the head of parliament sends a formal letter asking for an explanation for the delay. If the president remains indecisive or refuses to sign the act after one month of its date of approval, the act is legalized automatically. The difference in clause numbers occurred because extra clauses were added to the revised draft of the Water Act. This tremendously reduced the scope and degree of IMT. Even under the IOMP

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1987 Statement, the WUAs were responsible for O&M, up to the secondary level of the irrigation system. 14. Meeting between Commission IV and members of the Consortium of NGOs and Universities, 16 January 2004. 15. Officials in the agency referred to the strategy used by this official as ‘“throwing a hot ball” at your bureaucratic competitor. By preventing his colleagues from holding onto the “hot ball”, he was, in fact, excluding any possibility of his colleagues winning, or even staying, in the game. 16. First, the NDPA official illustrated how the moratorium could be regarded as a legal violation of both acts on regional autonomy and fiscal decentralization. Incorporated into regional autonomy, IMT implementation under WATSAL could not be halted as long as the Regional Autonomy Act remained effective. Second, he argued that the moratorium could reduce people’s trust in the government. Third, he mentioned how the moratorium could complicate the third tranche fund disbursement under WATSAL as stated in the 1999 LoSP. 17. Soenarno’s accusations of Working Team IV proved his strong dislike of the NDPA, especially with regard to its leadership role in the WATSAL organizational structure (MoHA meeting note, 3 September 2003). 18. Unlike the formal network, a social network continues even after retirement (for networking, see Chapter 3). 19. The sub-directorate was established in 1999 and immediately given the task of implementing IMT under the NewISF programme. During the WATSAL IMT programme, Kimpraswil viewed the sub-directorate as its bureaucratic competitor. 20. (Kompas, “Undang-Undang Sumber Daya Air” [Water Act], 28 November 2003). The promulgation process of the new Water Act attracted widespread public attention, with journalists covering both the bureaucratic disputes between Kimpraswil and the MoHA, and Kimpraswil’s controversial revisions (Jakarta Post, 27 November 2003). Eventually, the press altered its focus to the privatization issue (Kompas, 22 December 2003). For whatever reasons, neither the bureaucratic wrangling between Kimpraswil, the MoHA, and the NDPA, nor the actual process of political lobbying at parliament was publicly documented. Jakarta Post, “Controversy over Bill on Water Resources”, 27 November 2003. Kompas, “RUU SDA Kian Mengarah ke Komersialisasi” [Draft Water Act has More Tendency towards Commercialization], 22 December 2003. 21. These organizations included the Consortium of NGOs and Universities; the Irrigation Communication Network of Indonesia (or JKII, a prominent network in which many officials from the irrigation agency were members);

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22.

23.

24. 25.

26.

27. 28. 29.

30.

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the INFOG; and the NU (one of the most prominent religious, grass-roots mass organizations). INFOG was one of the NGOs formed shortly after the political reform in 1998. In the later stage of the ministries’ fighting, INFOG leader also became the leader of another newly formed NGO: the Water Rights Coalition for the Indonesian People. Officials from Kimpraswil were absent. I do not know if their absence was because of their unwillingness to attend or because they were never invited in the first place. Either way, their absence shows the intense bureaucratic conflict between Kimpraswil and other policy actors in favour of IMT. For anonymity purposes, names have been changed. Ahmad, it should be noted, formerly performed consultancy work for Kimpraswil. At the time of the meeting, he was also the head of the Indonesian Businessmen’s Association. Bagus’ role started as the contact person for the Consortium of NGOs and Universities in Commission IV. Although his opinion could be considered as a sign of bureaucratic integrity, it was also most likely shaped by competition. It was commonly known that both the MoHA’s Director General and Secretary General were competing for the same bureaucratic position in the next election. According to formal procedures in act promulgation, the draft Water Act could not be forwarded directly from the Working Committee to the plenary meeting without first being approved at a Commission IV meeting. I do not know if Ahmad said this because he did not know the order of the procedural steps or because he intentionally wanted to misinform the participants. Shortly after Chairil finished speaking, Ahmad questioned him about why he had proposed that suggestion. Chairil replied that this was just part of a strategy to promote democratization. A member of the Working Committee from PAN thought that the formulation team was hinting that Commission IV would not approve the final version of the draft Water Act. The Kimpraswil–PDI-P coalition was rooted in the political party partisanship system and the need to ensure the ruling party’s position for the upcoming April 2004 national election. With reference to this system, the coalition between Kimpraswil and PDI-P at the Working Committee level formed only a small part of the wider Kimpraswil–PDI-P coalition, though, starting in 1998, the evolution of direct presidential elections did reshape some of the mechanisms of this system. Because of this close relation, Soenarno did not have to consult with the president or other high-level PDI-P officials in his attempt to redirect the policy path of IMT under WATSAL.

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31. Dimas was a popular leader during the Jakarta student movements of the 1970s, though his political career was limited to a particular NGO. During the 1998 political reform, he succeeded in becoming a parliamentary member for the PAN political party and through his past connections became acquainted with the prominent NGO and university leaders in the civil society movement. 32. For political reasons, PAN representatives could not directly approach other party representatives. 33. Golkar was the ruling political party during the New Order government’s thirty-two years reign. After the political reform in 1998, Golkar suffered a major setback, though it remains the most organized political machine in Indonesia. 34. The demonstration’s leader, a member of the Consortium of NGOs and Universities, had to arrange formal permission to meet Commission IV at the parliamentary public relations office. I learned that a formal letter from Commission IV was required to finalize this permission. 35. During the walk over, some members expressed their opinion to me that politicians would only start to respect farmers once farmers stopped growing rice. 36. WUAs meeting with members of Commission IV, meeting note 19 December 2003. 37. I do not understand why Edi did not discuss the farmers’ opinions as he was a member of the PAN–Reformasi faction. When I asked counter-alliance members about this, they said that they themselves had no clue. As one member told me, “parliamentary politics was not always clear and understandable for outsiders”. 38. A WUA representative asked the former general how the government might implement the proposal, since government expenditure on the irrigation sector had been reduced considerably. The former general did not answer the question. 39. Interesting to note here is how members from the same political party (P3) could have contradicting position on the draft Water Act. Unlike Bagus, Beni thought that the promulgation process of the Water Act can still be postponed to incorporate farmers’ opinion. 40. Though invited, no officials from the NDPA were present in the meeting. 41. Kompas, “Pembahasan RUU SDA Kembali Mengalami Penundaan” [Water Act Promulgation Process Delayed], 18 December 2003. 42. After the MoHA received the letter from Kimpraswil, officials from the SubDirectorate of Water Resources met with consortium counter-alliance members on 23 December to discuss the revisions of to the December 15 draft Water Act.

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43. Kompas, “Undang-Undang Sumber Daya Air” [Water Act], 31 December 2003. 44. This was the second time that a prominent government official in favour of IMT policy was removed over IMT policy. Unlike the first removal (a key WATSAL policy-maker from the NDPA was removed from the WATSAL Task Force in September 2003), Kimpraswil’s interference was much more evident this time, though I do not know if the removal was formally or even openly proposed by Soenarno to head of the NDPA. Nevertheless, it was Soenarno’s objection to the national seminar that pointed a bureaucratic finger in one direction: towards the head of the DIWR. 45. According to interviewees, this seminar could have been financially backed by one of the prominent political parties, namely, Golkar or the PDI-P. As the April 24 national election was approaching, the seminar could have given these political parties direct access to WUA representatives, one of the main target voter groups, not to mention the populist topic of the seminar. In the first scenario, Golkar’s interest in approaching the WUAs was evident from its past actions. In the second scenario, it is unlikely that the PDI-P would have been the main funder because of the PDI-P–Kimpraswil alliance in Commission IV (though the seminar might have been used by some political factions in the PDI-P to increase political influence, internal competition within this party was apparent in the period nearing the national election) (Kompas, “Dekonstruksi Partai Politik” [Deconstruction of Political Parties], 16 January 2004. 46. Consortium NGOs and Universities meeting with Bagus, meeting note 30 January 2004. 47. Following the Water Act’s approval, criticism of its present formulation flooded the national newspapers. Criticism came from NGOs (INFOG and WALHI; the latter is an environmental-focused NGO), the Nahdlatul Ulama, and individuals (Kompas, 5, 13, 14, 16, and 18 February 2004). Most of the concerns related to access to water for the urban poor. Reacting to these concerns, Soenarno announced that the government would control and regulate the water sector to prevent privatization and to ensure the local population’s access to water: “We will take sides with the people, and not with the businessmen. Private sector’s involvement in water management was meant only to give them a chance to participate” (Kompas, 18 February 2004). It is interesting to note here that although the participation of the private sector was encouraged, no reference was made to farmer participation in irrigation systems management. Kompas, “Hal Negatif RUU SDA” [Negative Aspects of the Water Act], 5 February 2004; Kompas, “Privatisasi Berkedok Bantuan Dana” [Privatization Under the Mask of

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48. 49.

50. 51. 52.

53. 54. 55.

56. 57.

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Financial Support], 13 February 2004; Kompas, “Disetujui, RUU SDA Tanpa Perubahan Berarti” [Promulgated, Water Act without Significant Changes], 14 February 2004; Kompas, “Privatisasi Air Tinggal Selangkah Lagi” [Water Privatization Just One Step Left], 16 February 2004; Kompas, “Jangan Buka Peluang Privatisasi Air” [Don’t Open Possibility for Privatization of Water], 18 February 2004. Without PAN/Reformasi, members at this second meeting of Commission IV would have immediately approved the draft Water Act. It appears that during this meeting, each party’s position and opinion on the draft Water Act was rehearsed. For example, some members of P3 and PDI-P emphasized the need to approve the draft Water Act as is, since Commission IV already agreed to this version. Kompas, “Koalisi Ornop: Batalkan UU Sumber Daya Air” [Coalition of NGOs: Amend the Water Act], 2 July 2004. Kompas, “Mahkamah Konstitusi Tolak Permohonan Uji Materiil” [Judicial Court Declined the Request to Review the Draft Water Act], 20 July 2004. Kompas, “Akses Masyarakat ke Sumber Air Makin Kecil: Pemegang Hak Guna Usaha Berpeluang Eksploitasi Air” [People’s Access to Water is Reduced: Private Sector Could Exploit Water Use Rights], 23 July 2005; Kompas, “Air Mengalir Menjauhi Konstitusi” [Water Flows Distancing from Constitution], 1 August 2005; Kompas, “Nasib Pengelolaan Sumber Daya Air” [The Fate of Water Management], 2 August 2005; Kompas, “Pengelolaan Air Butuh Partisipasi” [Water Management Needs Participation], 23 August 2005; Kompas, “Hak Guna Usaha Air ke Privatisasi” [Water Use Rights to Privatization], 15 December 2005. Kompas, “Akbar Tandjung Siap Jadi Wakil Presiden” [Akbar Tandjung Ready to be Vice President], 24 February 2004. Kompas, “Akbar Tandjung Dinyatakan Bersalah Atas Tuduhan Korupsi” [Akbar Tandjung Found Guilty on Corruption Charges], 27 January 2004. As one Kimpraswil official said during another informal meeting between Kimpraswil and the consortium on 18 February 2004, “The next day, the draft Water Act would be discussed in the Commission IV meeting. Hence, we did not see the point of having to note the suggestions from the consortium members”. Later, at the meeting mentioned in note 55, Febri said, “Parliament is a political arena, where differences in opinion and perceptions could always be converged into a decision”. MoHA Ministerial Decree Number 22 of 2003, MoF Ministerial Decree Number 298 of 2003, and Government Regulation Number 77 of 2001.

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58. World Bank, Letter to the NDPA on WATSAL (Ln 4469-IND), 19 November 2003. 59. Ibid. 60. P. A. Sabatier and S. Hunter, “The Incorporation of Causal Perceptions into Models Elite Belief Systems”, Western Political Quarterly 42, no. 9 (1988): 229–61.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

6 REGIONAL GOVERNMENTS AND IMT POLICIES

INTRODUCTION This chapter focuses on how the irrigation agency at different administrative levels coped with the internal contradictions that developed when implementing Irrigation Management Transfer (IMT) after passage of the Water Act. It explains the strategies used by provincial and district governments to undertake the IMT policy changes that occurred with the new Water Act. It illustrates how IMT implementation under Water Sector Adjustment Loan (WATSAL) was shaped by the project development approach both before and after the IMT policy struggles. This chapter is divided into six sections. Section I highlights Kimpraswil’s Participatory Irrigation Program (PIP) after the passage of the Water Act on 19 February 2004. In Section II, I discuss the provincial governments’ general position on IMT, and then in Section III, I dissect how the irrigation agency in the Kulon Progo district, in particular, dealt with the WATSAL IMT programme. Section IV analyses how WATSAL policymakers’ attempt to use the stimulant fund as a tool to eradicate rent-seeking practices in the irrigation sector backfired. In Section V, target-oriented IMT implementation and Federation of Water Users Associations (FWUA)

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organizational development is discussed, while Section VI explains how the implementation of the WATSAL IMT programme was overwhelmed by project procedures and mechanisms.

SECTION I: KIMPRASWIL AND ITS NEW PARTICIPATORY IRRIGATION PROGRAM In the aftermath of the IMT policy infighting in 2003 and early 2004, Kimpraswil promoted its new IMT policy under its PIP, in which farmers’ involvement was limited to the tertiary level. At the national level two workshops were held, on 11 March and 18 April 2004 at the National Development Planning Agency (NDPA), to inform regional government representatives about the recent passage of the Water Act and the need to halt WATSAL IMT implementation. Present at these workshops were officials from Kimpraswil, the NDPA, the Ministry of Home Affairs (MoHA), and regional government representatives from the twenty-nine provinces in Indonesia. At the regional level, Kimpraswil also introduced its new programme through seminars and workshops. For example, in Yogyakarta, a workshop was conducted on the cultural aspects of irrigation management. Formally, Kimpraswil did not have any authority to direct regional governments’ policy on IMT. In 2001, regional governments had been authorized to define their own development programmes within the overall application of regional autonomy. Kimpraswil lacked any legal power to enforce direct policy translation from the national to the regional level, not to mention that it was no longer even represented at the regional level. The sectoral command line in irrigation, which had run from Kimpraswil down to its representative at the field level, was cut as a direct consequence of this regional autonomy. Kimpraswil’s regional offices and the Division of Provincial Irrigation Services (DPIS) (Kimpraswil’s representatives at provincial level and district level, respectively) were abolished. Similarly, the project management unit of Kimpraswil was incorporated into the provincial government structure. Overviews of the provincial government structure, before and after regional autonomy, are presented in Figures 6.1 and 6.2. It was the implementation of the WATSAL IMT programme through the project structure that preserved Kimpraswil’s power to direct the sector’s development. The PIP leader became Kimpraswil’s “new” representative at the provincial level, in essence replacing Kimpraswil’s regional office, with

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FIGURE 6.1 Overview of Provincial Government Structure (before Regional Autonomy) Provincial Irrigation Project MPW regional office

Head of DPIS

Governor Prov. Development Planning Agency

Provincial Water Resources Service

Other sectoral agencies

Section Housing

Provincial Irrigation Agency

Section Road Infrastructure

Sub-Division Irrigation DPIS field staff

FIGURE 6.2 Overview of Provincial Government Structure (after Regional Autonomy) Governor Prov. Development Planning Agency Other sectoral projects

Section Road Infrastructure

Section Housing

Provincial Water Resources Service

Other sectoral agencies

Provincial Irrigation Provincial Irrigation Agency Project

project funds for IMT implementation disbursed directly from Kimpraswil to the PIP. The Provincial Water Resources Services (PWRS) leader, who oversaw PIP, was not always informed about funds disbursement for IMT implementation.1 Kimpraswil strategically used its distribution of project funds to force regional governments into compliance in halting WATSAL IMT implementation; it even temporarily froze fund disbursement in several districts shortly after passage of the new Water Act. Development activities

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related to the WATSAL IMT programme were given “non-budgetary” status, meaning that no funding would be given to these activities until further notice, and IMT implementation under Kimpraswil’s Java Irrigation Improvement and Water Resources Management Project (JIWMP) was completely halted. While the new Water Act provided Kimpraswil with the legal footing to recentralize the sectors’ development, it was under the control of the project funds that allowed Kimpraswil to halt the implementation of the WATSAL IMT programme in the field.

SECTION II: PROVINCIAL GOVERNMENTS’ POSITION ON IMT This section illustrates the strategies used by the provincial governments to cope with the policy transition from WATSAL to Water Resources and Irrigation Sector Management Project (WISMP), from early 2004 to late 2005.2 It also details the specific relationship between PIP leaders and Provincial Irrigation Agency (PIA) officials, and how the PIA’s position on IMT was based on its ability to receive fund disbursement outside the project structure. The section is based on interviews with PIP leaders in East Java, Yogyakarta, and West Java provinces and with PIA officials.3 I limit my selection to provinces on Java because, unlike in other provinces, IMT had been implemented on Java with the formulation of the Irrigation Operation and Maintenance (IOMP) 1987 Statement in 1989. By limiting analyses to Javanese provinces, comparison of IMT implementation under pre-WATSAL and WATSAL periods is possible.

The Varying Agencies’ Strategies The PIA, which was under the PWRS, maintained its position on IMT under WATSAL because of its interest in receiving direct access to sectoral development funds. In West Java, PIA officials neither objected to the adoption of the WATSAL IMT programme adoption nor insisted on its continuation, so long as Kimpraswil guaranteed project fund disbursement. Access to the money was so important that both the PIA and PIP competed to manage IMT project funds, with PIA officials objecting to the way the PIP leader dominated control of the funds. As one PIA official in West Java told me in 2004:

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We tried to gain access to the IMT project funds [for] irrigation systems, which crossed more than one district boundary … under WATSAL. However, the PIP leader insisted on limiting the PIA’s involvement [with] … project funds by focusing IMT implementation on irrigation systems at [the] district level. In this way, IMT project funds were disbursed directly from the PIP to the district government.

After passage of the Water Act, Kimpraswil ensured PIP and PIA officials’ interests through its allocation of construction and rehabilitation funds outside of IMT. I did not observe any significant differences in the PIA’s activities before or after the IMT policy changes, as the focus remained on construction and rehabilitation projects. After the Water Act passed, the majority of Yogyakarta PIA officials agreed with Kimpraswil that farmers’ decision-making authority should be limited to the tertiary level. As one official said in 2004: It is impossible for the government to give farmers full authority for irrigation systems management, if farmers are unable to finance the systems. The low ISF collection rate proves farmers’ financial inability to be held responsible for systems O&M above the tertiary level.

Officials, therefore, justified Kimpraswil’s decision to halt the implementation of the WATSAL IMT programme by blaming farmers’ inability (financial, technical, and managerial) to oversee their irrigation systems. According to other PIA interviewees, the FWUAs were blamed for neglecting irrigation systems Operation and Maintenance (O&M) because their main interest in IMT was access to project funds through rehabilitation projects. Officials in the On-Farm Water Management Project (PTGA)4 in the Yogyakarta, on the other hand, thought that IMT policy was driven primarily by the reduction of irrigation agency field staff at the regional level, not by farmers’ inability to take over systems management from the government. As one official told me in 2004: “Even when Kimpraswil consider[ed] that farmers [were] unable to take over the systems management, efforts to increase farmers’ capability should [have been] made”. As with all the other organizations, though, the opinions of the PTGA officials are rooted in their interest in sectoral development funds. With their main task of empowering farmers in irrigation systems management, the implementation of the WATSAL IMT programme would have improved their access to development funds. Put another way, their main fear

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during the IMT policy debates was that fund disbursement would be frozen, not that their efforts to empower farmers would be halted. After the programme’s demise, PTGA officials attempted to capture portions of the regional revenue by extending their organizational unit to the district level. When this was unsuccessful, PTGA complied with Kimpraswil’s demand to limit farmers’ involvement to the tertiary level, launching a new managerial training programme for farmers, designed especially to strengthen their involvement at the tertiary level.

The PIA–PIP Relationships in Yogyakarta and East Java In East Java, strong working relationships between Kimpraswil’s PIP leader and the regional PIA officials enabled the PIA to continue with WATSAL IMT implementation, even after Kimpraswil froze fund disbursement. Prior to the policy conflict, both the PIP leader and PIA officials in East Java had agreed to allow project funds to be used as routine (general management) funds. Both project funds and routine funds were allocated by the central government to the regional governments. The difference was that project mechanisms restricted the expenditure of project funds to certain periods and for certain predefined activities, while routine funds were always available for disbursement. Initially, the PIA officials proposed this allowance because they wanted to use project funds to continue empowering farmers, even after the IMT project was to end. After the IMT policy debates, the remaining project funds from the WATSAL IMT programme became the PIA’s only financial resource to continue with IMT. In Yogyakarta, on the other hand, the PIA supervisor failed to counteract Kimpraswil’s halt of the WATSAL IMT programme because he lacked support from the PIP leader.5 In this case, the PIA’s authority was undermined by Kimpraswil’s relationship with its PIP leader. Even prior to the policy manoeuvrings, the Yogyakarta PIA had been excluded from the decision-making process, with decisions on fund disbursement and proposed project activities discussed exclusively between Kimpraswil and the PIP leader. The PIA was informed about project fund allocation only after the funds were spent. After the new Water Act was passed, the Yogyakarta PIA was forced to follow PIP’s decision6 to halt the WATSAL IMT programme. The motivation for the PIA leader7 to want to continue the WATSAL IMT programme was clearly stated in an interview in Yogyakarta, in

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2004: “Even when farmers are proven financially incapable of managing the irrigation system, this inability should not be presented as a barrier to promote farmer empowerment in IMT”. He countered Kimpraswil’s argument that farmers were financially unable to take over irrigation systems management, saying: The ISF collection rate did not at all reflect farmers’ financial capability. Regardless of their financial condition, farmers did not always feel motivated to pay their ISF contribution … because [their] actual needs were not always represented in the way the collected ISFs were spent, as ISFs [mostly] went to pay FWUA/WUA staff salaries.

As mentioned above, the PIA in East Java was able to ensure the allocation of development funds for the WATSAL IMT programme through its access to routine funds, and unlike in Yogyakarta, there was strong opposition from both the PIP leader and PIA officials to Kimpraswil’s demand to halt the WATSAL IMT programme. The PIP and PIA were able to access additional funds through their combined close relationships with officials in the Provincial Development Planning Agency, which was responsible for preparing budget allocations for proposed development programmes. According to interviews in 2004 with PIA officials in East Java, when Kimpraswil officials confronted their decision to continue with WATSAL IMT implementation, both the PIP and PIA claimed the vague formulation of the new act to justify their decision to continue with the programme. These officials twisted Kimpraswil’s recentralization effort, arguing that the new Water Act did not legally forbid the extension of farmers’ decision-making authority beyond the tertiary level. When Kimpraswil officials confronted them with problems that had occurred during the implementation of the WATSAL IMT programme, PIA officials explained they were caused only through the learning process on the part of both farmers and Kimpraswil in synchronizing their new roles in systems management. The East Java PIA was independent in its actions because it had both access to regional revenue, and its standing on IMT did not originate from competing national bureaucratic interests. As one senior official in the East Java PIA told me in 2003: The PIA’s decision to continue with the WATSAL IMT program was related neither to the promulgation of the new Water Act nor MoHA’s attempt to continue with IMT under WATSAL. The decision was simply derived from farmers’ de facto role in systems management and the high absence of irrigation agency field staff [due to zero recruitment].

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SECTION III: THE KULON PROGO DISTRICT District government staff8 directly implemented IMT activities under WATSAL for the first time as a result of the introduction of regional autonomy. This section analyses the organizational restructuring of the district irrigation agency in the Kulon Progo district and how this district coped with Kimpraswil’s attempt to halt the WATSAL IMT programme. The Kulon Progo district is located in the western region of Yogyakarta. There are three other districts in the province: Gunung Kidul, Sleman, and Bantul in the southern, northern, and eastern part of Yogyakarta City, respectively (see Figure 6.3).

The District Irrigation Agency’s Organizational Restructuring Before regional autonomy, all government agencies followed the same organization structure; irrigation agencies at the district levels were divided between either the District Water Resources Services (DWRS) or the DPIS. The DWRS was a first-level government organization, whereas DPIS was

FIGURE 6.3 Districts in Yogyakarta

* Mount Merapi Sleman Sleman Kulon Progo

Yogyakarta

Wates In

N 0

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10

di

Bantul

an

20 km

Bantul

Wonosari Gunung Kidul

Oc

ea

n

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a second-level organization under the PWRS. In actuality, however, the DPIS acted as a first-level agency for the Ministry of Public Works (MPW) (the irrigation ministry up until 1998) because the MPW was not authorized to hire staff at the district level. The DPIS’s primary task was to implement nationally funded project activities, and it played an important role in district-level irrigation development because these activities came through the project mechanisms. Both the DPIS and the DWRS consisted of three development sections: irrigation, housing, and road infrastructure (following the former MPW’s national organizational structure). The difference was that the DWRS had absolutely no field staff, unlike in the DPIS, where each development section was fully staffed. The organizational structure of the Kulon Progo district irrigation agency before regional autonomy is presented in Figure 6.4. Before regional autonomy in 2001, the head of the DWRS directed only his own budget, with the DPIS receiving its development budget from the MPW. Unsurprisingly, both units were preoccupied with their own development activities and were unaware what the other agency was doing. After regional autonomy, district government structure varied between districts. The restructured irrigation agency in the Kulon Progo district is presented in Figure 6.5. The Kulon Progo DPIS 9 underwent a massive bureaucratic transformation under regional autonomy. The newly reformed DPIS was put under the authority of the DWRS, not the PWRS, at the district level. In addition, DPIS staff was to be replaced by district government employees. However, DPIS officials managed to continue to play an important role in the irrigation sector by cleverly replacing the existing irrigation section under the DWRS with another organizational unit shortly before the application of regional autonomy. This new unit was called the Sub-Division of Irrigation, or SDI. This replacement seemed rather ceremonial at first, as it appeared to mainly concern changing the name of the development unit from a section to a subdivision. I later discovered, however, that the replacement allowed for the important transfer of prominent policy actors from the former DPIS into this new unit, enabling them to take over even before new DPIS staff could be appointed. In addition, project funds for the WATSAL IMT programme from Kimpraswil and the MoHA, as well as regional revenue funds from both the district and provincial governments, were channelled directly to the SDI. As the head of DPIS 2 told me in 2004:

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DPIS field staff

DPIS field staff functional line

Sub-Division Irrigation

Sub-Division Housing

Head of DPIS

MPW regional office

Provincial Irrigation Project

DPIS field staff

Sub-Division Roads

Section Housing

Sub-Division Housing

structural line

Section Irrigation

Head of DWRS

Prov.Irrigation Agency

Head of PWRS

Section Roads

Sub-Division Roads

province district

FIGURE 6.4 The Kulon Progo Irrigation Agency District-Level Structure before Regional Autonomy

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DPIS 2 DPIS field staff

DPIS 1

DPIS field staff

Other structural projects

Sub-Division Housing

Section Housing

structural line

DPIS field staff

DPIS 3

Section Housing

Sub-Division Irrigation

Head of DWRS Sub-Division Roads

Prov.Irrigation Prov.Irrigation Agency Project

Head of PWRS

province district

FIGURE 6.5 The Kulon Progo Restructured Irrigation Agency after Regional Autonomy

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The present bureaucratic transformation in the DPIS did not result in any significant bureaucratic transfer from the sectoral agency to the DPIS. The SDI remained in charge of channeling sectoral funds [and all] decisions with regard to the development program were made by the SDI. In short, the organizational structure was changed, but the old mechanisms … still applied … nothing really changed.

The SDI and the new DPIS were assigned different tasks in irrigation management. The SDI was assigned as the coordinator, whereas the DPIS was responsible for directing irrigation management practices at the system level. However, overall implementation of IMT under WATSAL was conducted by the SDI, without any involvement of the newly formed DPIS. Quite to my surprise, the new DPIS staff (once they were appointed) was not even aware of the WATSAL IMT programme or its implementation by the SDI. This was quite a testament to SDI’s ability to function independently, as the SDI was not officially authorized to direct field staff; they were supposedly under the jurisdiction of the new DPIS.

Kimpraswil’s Attempt to Halt the WATSAL IMT Programme in Kulon Progo The district government of Kulon Progo decided to continue with the WATSAL IMT programme, despite passage of the new Water Act. This position was unanimously adopted by district government representatives from the DWRS and the District Development Planning Agency (DDPA)10 during an Irrigation Committee11 meeting in early March 2004 and formally presented to the district head. On 13 March 2004, it formally announced that Kulon Progo would continue with the WATSAL IMT programme, backing the decision of the Irrigation Committee. This announcement revealed the SDI’s view of IMT as a possible solution for the existing problems in irrigation systems management. The SDI wanted to use IMT as a strategic policy instrument to stimulate farmers’ financial contributions to systems management, thus reducing government expenditure in the sector (note that the aspect of cost recovery in IMT had re-emerged under WATSAL). Within the four years of IMT implementation under WATSAL, some Kulon Progo FWUAs had collected a considerable amount of money from the irrigation service fee (ISF) paid by the farmers.12 SDI staff realized that they would have to rely on their relationship with farmers for the delegation of their decision-making authority in irrigation systems management, bearing in mind the missing command line between

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the SDI and DPIS field staff. SDI staff was convinced that they would be able to sustain their importance, as long as they could direct farmers’ involvement according to the applied management procedures. The SDI’s determination to continue with the WATSAL IMT programme was also related to Kimpraswil’s treatment of those districts where management transfer had actually taken place, as compared to districts in which IMT had been implemented but had not been followed by formal management transfer. Kimpraswil disbursed sectoral development funds primarily to the latter districts, while completely cutting payments to the former. Disappointed by being treated unfairly, the SDI in Kulon Progo determined that they had no other choice but to continue with the WATSAL IMT programme. One of the SDI key staff, interviewed in 2004, told me: The SDI never wanted to implement IMT under WATSAL [but] was instructed [to do so] by the central government ministry …. SDI staff in Kulon Progo was determined to make IMT implementation successful, motivated by the strong policy support from the … ministry. Later, Kulon Progo district was “praised” for its IMT implementation. However, all this effort turned [pointless] when, all of sudden, Kimpraswil changed its attitude towards the WATSAL IMT program, and turned its back on the very district irrigation agencies that had promoted its implementation.

By the time that the new Water Act was passed, IMT implementation in the Kulon Progo district had reached such an advanced stage that it no longer fit with Kimpraswil’s policy attempt to return the decision-making authority for irrigation management to the SDI. As stated by another SDI staff member in 2004: The SDI could not regain its power from the recent policy setback in the WATSAL IMT program because the management of all technical irrigation systems in the district had been transferred to [the] FWUAs. According to the new Water Act, farmers’ decision-making authority was limited to the tertiary level. However, in Kulon Progo, [the] FWUAs were already formed and functioning. Hence, the SDI would ensure that the FWUAs remained. It would be a pity if the considerable amount of development funding that had been spent to promote FWUA organizational development had to result in nothing.

So, SDI staff continued with the WATSAL IMT programme, relying primarily on regional revenue from the district and provincial governments, such as funds for systems repair and maintenance.13 The Kulon Progo SDI continuously encouraged the FWUAs to increase its ISF collection

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to become financially independent from any government support (see Table 6.1 for detail information of these FWUAs and Figure 6.6 for its authoritative boundaries). One of the proposed strategies to increase ISF collection was to involve farmers in the overall collection process. The SDI suggested that the FWUAs should collect ISFs based on their agreement with farmers because it would allow the farmers to list their priorities and to strengthen the organizational link between the FWUAs and its farmers. Some FWUAs were unified under the system-level Water Users Associations, which occurred only by mutual agreement of the FWUAs involved. The SDI believed that unification would motivate the FWUAs involvement in its organizational development, because it would dramatically reduce the number of FWUA staff at least by half, thus indirectly increasing the remaining staff salaries. To motivate FWUA involvement in irrigation systems management, the SDI, in association with the provincial government, arranged a Kulon Progo FWUA-wide competition,14 in which each FWUA would be judged by both its formal and field organizational development. The formal organizational requirements included factors such as financial audits, registration of meeting notes, and ISF contributions. One field requirement was a report about each FWUA’s

TABLE 6.1 Overview of the Irrigation Systems in the Kulon Progo District Number of Location WUAs

Irrigation system

Size

Number of FWUAs

Kalibawang

1,488

2 (Kalibawang I and II)

41

Upstream

Donomulyo

534

1

18

Upstream

Penjalin

652

1

12

Upstream

Papah

983

2 (Cangkring Mulyo and Kongklangan)

16

Midstream

East Pengasih

671

1

15

Mid/tail end

West Pengasih

1,329

Pekik Jamal Sapon

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868 1,800

1

20

Tail end

2 (West and East Pekik Jamal)

15

Tail end

3 (Kengkeng, Wonokasih, and Banaran)

36

Mid end

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FIGURE 6.6 Irrigation Systems in the Kulon Progo District

direct interaction with both its Water Users Associations (WUA) and the farmers in the field. The winner of this competition would represent the Kulon Progo district in the FWUA competition at the provincial level.

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With the SDI taking the leading role in continuing implementation of the WATSAL IMT programme, the PIA and PIP focused on implementing activities funded by the central ministries, including recruitment of a community organizer (CO), whose task was to facilitate farmer empowerment in IMT.

SECTION IV: KABUPATEN IRRIGATION IMPROVEMENT FUND (KIIF) — WEAPON TO ERADICATE CORRUPTION OR A TOOL TO TRANSFER RENT-SEEKING? Under WATSAL, IMT implementation was to be conducted through five stages, according to the defined systematic framework.15 Stage 1: Preparation for IMT implementation included activities to raise public awareness, the formation of an Irrigation Committee at each district, and the formulation of IMT legal regulations at the regional level. Stage 2: WUA/FWUA training in construction and rehabilitation, administrative management, and farming enterprises. Stage 3: Creating legal agreements for the actual management transfer by the DWRS, together with the FWUAs. The agreement needed to include task redefinition for irrigation institutions at the district level. Stage 4: Introducing new irrigation system finance through the Kabupaten Irrigation Improvement Fund (KIIF), a stimulant fund. Stage 5: Formulating policy strategies to promote sustainable irrigation.

In Kulon Progo, the implementation of the WATSAL IMT programme from both the JIWMP–IDTO (Java Irrigation Improvement and Water Resources Management Project–Irrigation Development Turnover) project and the NewISF programme was merged and coordinated by the SDI. According to the framework for IMT implementation, the KIIF was to be introduced during the fourth stage, after the irrigation systems had been transferred to the FWUAs. In reality, the use of the KIIF was introduced as early as in 2002. Stimulant funds were first allocated directly by the project leader to the district government and later disbursed to the FWUA bank account. The early introduction of the KIIF illustrates the WATSAL policy-makers’ main strategy to eradicate bureaucratic rent-seeking in the irrigation sector. The KIIF was never mentioned explicitly in either

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Government Regulation Number 77 of 2001 (on irrigation) or Kimpraswil Ministerial Decree Number 529 of 2001 (on IMT guidelines). As one policymaker expressed in an interview: We hope[d] to eliminate corruption practices in the irrigation sector by shifting the decision-making authority for sectoral funds management from the irrigation agency to [the] FWUAs. The sooner we could transfer this … authority … the better. Hence, we started the application of the stimulant fund prior to the [actual] promulgation of the Ministerial Decree on the KIIF.

Unfortunately for the WATSAL policy-makers, their attempts to use the KIIF stimulant fund as a weapon to eradicate rent-seeking practices backfired. IMT implementation, through the project approach, forced FWUA organizational development along the bureaucratic lines of Kimpraswil. The rest of this section dissects the FWUAs’ organizational characteristic as a contracting agency, how the FWUAs were incorporated into the chain of undetectable funds (mis)management in the irrigation sector’s development, and how the KIIF ultimately preserved Kimpraswil’s bureaucratic power at the district level.

FWUAs’ Organizational Characteristics Like Kimpraswil, the FWUAs’ organizational existence was rooted in infrastructure development,16 with KIIF expenditures focused on rehabilitation and maintenance activities because project rules required that it be used only for these activities. Stimulant fund management transformed the FWUAs from government-induced farmer organizations into contracting agencies. The motivation of FWUAs to improve its organizational functioning was rooted in their interest to increase financial profit by managing the disbursed funds. The FWUAs had a two-pronged approach: attempt to gain as much development funding as possible and to use its knowledge about project mechanisms (both technical and managerial) as the key element in its organizational development. As a staff member from FWUA Kongklangan in Papah, told me in 2004: “An FWUA’s success was defined by its ability to develop the [correct] type of proposal and [to] send it to the [proper] institutions”. Apart from the KIIF stimulant fund, FWUAs in Papah, West Pekik Jamal, and West Pengasih also prepared development proposals for other potential funders, including

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district and sub-district governments and ministry representatives at the district level. The FWUA transformation into individual contracting agencies was most apparent in the Papah irrigation system. A staff member in FWUA Kongklangan, when interviewed in 2004, said: An FWUA had to be profit oriented [and] needed money [for] proposal development [which] was a costly activity …. [T]o make an initial proposal, we had to … [first] check the field … [and] later … go back to the same site … to compare the initial proposal with the field condition at that time, in case changes occurred [from] the time the proposal was developed. Not to mention that sometimes FWUA staff needed to buy new technical [items] to make a more accurate proposal, such as surveying equipment.

A Cangkring Mulyo employee admitted seeking technical support from another local contracting agency to improve the FWUA’s overall technical analysis capabilities.

FWUAs’ Incorporation into the Chain of Undetectable Funds (Mis)management The FWUAs’ authority to manage the KIIF linked them to the chain of undetectable fund (mis)management because the project requirements in stimulant fund management forced them to follow certain mechanisms and procedures in the implementation of the WATSAL IMT programme to be eligible for KIIF payouts. The FWUAs’ inclusion in the chain of rentseeking practices, a practice that they had originally wanted to abolish, and financial mismanagement, became evident in the majority of the FWUAs. One outstanding example is the record-keeping that occurred in FWUA West Pengasih. Different versions of financial records were reported by the former FWUA leader to cover his financial misconducts. Each time an SDI analyst pointed out the absurdity of a financial report, another record was produced, always signed under the name of a different FWUA staff member. In one of these reports, the total budget spent on labour exceeded standard labour costs to such an extent that an SDI analyst questioned whether the FWUA was conducting major demolition activities. Collaborating with his treasurer, this former FWUA leader directed much of the allocated funds for rehabilitation activities, as well as other funds that were channelled to the FWUA, through his personal bank account. He

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also allocated government support (sometimes in the form of construction materials) only to those who belonged to his alliance. Meanwhile, the FWUA Kongklangan in Papah manipulated financial reports by “adding” extra labourers to every project, thereby increasing the amount of money needed per project. The FWUA in East Pengasih, also looking for financial gain, worked together with DPIS field staff17 to manipulate the standard mixture of construction materials, using more cheap sand to expensive cement, thereby exceeding the standard formula. Finally, in East Pekik Jamal, the FWUA leader did not even bother to produce a fake financial report, nor did he inform his staff or WUA members about fund allocation. While fund management was supposed to be conducted through close and informal financial agreements, WUA staff and farmers were never informed about how funds were really being used, so consequently, nobody knew how he spent the stimulant fund. FWUA Kongklangan in Papah, in particular, conducted the decisionmaking process regarding stimulant fund expenditures in secret, with no outsiders allowed in meetings.18 When I inquired about this secretiveness, some employees admitted that the presence of an outsider would make the FWUA staff feel uneasy about their financial arrangements within the overall process of fund management, arrangements included how some of the stimulant fund was used for FWUA staff salaries. The FWUA leader also took a percentage from the fund and distributed it as a “benefit” among loyal employees, keeping the highest percentage for himself. In a more extreme example, in FWUA East Pekik Jamal, the FWUA leader transformed the entire FWUA into a one-man organization so as to optimize his financial benefits from managing the stimulant fund. He prepared the reports for proposed works and for the financial management of the fund, and to make the situation even more profitable, his relatives conducted all proposed development activities. An FWUA’s access to the KIIF, and its disbursement of these monies, was linked with a backwards logic that emphasized spending the entire allocated development budget within a certain period of time, regardless of actual development needs or expenses. This led to maintenance and rehabilitation activities being conducted, regardless of farmers’ actual needs. In another twist of logic, FWUAs’ very existence was rooted in its disbursement of stimulant funds and not in its representation of farmers’ needs. As confirmed by an FWUA staff member in Cangkring Mulyo in 2004: “The key behind the good [standing] of this FWUA is

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that its staff are always able to spend the total amount of the allocated development funds”. Worse, the FWUAs perceived the KIIF as a gift, not as a government disbursement, which is why no FWUA felt responsible for proper management of the fund. FWUA staffs were confident that access to the stimulant fund would be secure and ongoing, regardless of how they actually used the fund, and this confidence was rooted in the financial control mechanisms for projects. Fund management was controlled by each FWUA primarily filing a project financial report; whether any report was based on the truth was irrelevant. The FWUA leader would produce the “right type” of project report to describe all the “activities” conducted, so as to appear responsible and accountable to the managers at the provincial and national levels. The financial reports were frequently not based on any actual data from the field, as they were often prepared before development activities were even conducted. To add to the mismanagement, SDI staff would remain silent if wrongdoing was suspected, to protect their own jobs. Returning to the misappropriation of funds by the FWUA West Pengasih, the SDI employee overseeing this FWUA did nothing, because reporting it would have negatively affected his own performance evaluation. Meanwhile, the staff viewed the SDI’s indifferent attitude towards its actual use of the stimulant fund as permission to continue with their rent-seeking practices. Eventually, the SDI called for open meetings, and their findings forced a reorganization, which included firing the FWUA leader and any staff in his alliance. The leader defended his actions during a restructuring meeting in 2003, insisting that he had not mismanaged the stimulant fund, saying: “Materials have been bought and used. Labor has been paid. The amount … spent … cannot be changed because everything has been conducted according to the defined project procedure” (field notes, West Pengasih restructuring meeting, June 2003). Though this restructuring allowed the farmers, SDI, and WUA to redirect funding for appropriate use, it needs to be pointed out that neither the newly elected FWUA leader nor the WUA staff took any action to get already-spent stimulant money returned. The SDI and WUA’s goal was reorganization and appearing to make a change, not actually fixing the problem. The majority of the FWUAs made informal financial contributions to the SDI as a response to the “complicated” (i.e. purposefully unclear) procedures in proposal writing, according to interviews with different FWUA staff in 2004. These contributions were then deducted from

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the amount of stimulant fund to be received by each of these FWUAs. Nevertheless, the FWUAs believed that these contributions would smooth their proposal approval process by the SDI. The SDI preserved its bureaucratic power by confusing19 the FWUAs on proposal procedures and report writing in respect to stimulant fund management; for example, the SDI kept FWUAs ignorant about the standard technical and managerial requirements of proposal writing and offered no formal guidelines on how to prepare development proposals. In addition, the SDI changed existing rules or invented new rules in proposal writing according to its interests. In one such case, when approached by FWUA staff in Sapon, SDI staff refused to answer their questions, instead telling them that they should have approached SDI staff with any questions during the proposal writing process. The SDI rejected and/or approved FWUA development proposals by its own whimsy. The SDI rejected the proposal made by the FWUAs in Kalibawang and in Sapon, claiming that each proposal lacked the required technical explanation. However, there were no significant differences between these two proposals and the proposal submitted from the FWUA West Pekik Jamal, which was approved:20 this successful proposal also lacked the technical explanation. For unknown reasons, stimulant funds were later allocated for the FWUAs in Kalibawang and in Sapon, even though the required technical explanation had not been added to either proposal. In another example, the SDI decided to postpone the stimulant fund allocation to the FWUA in East Pengasih because they alleged that FWUA staff had manipulated the fund management, accusing them of preparing the financial report beforehand, to which the FWUA argued that the early report preparation was made based on the SDI’s own instructions. The SDI then changed its reason for postponing the fund allocation, saying that they were not convinced that the FWUA had written the proposal with the involvement of the WUA. Reacting to the SDI’s doubt, the FWUA arranged a meeting with WUA representatives to discuss the proposed development activities, yet the allocation of the stimulant fund for East Pengasih remained blocked. The fund was released after the FWUA leader contacted the district about this ordeal: a contact that was only made possible because he is a distant relative of the district leader. I also learned that the SDI’s decision to postpone this particular stimulant fund allocation was rooted in the alliance between the FWUA East Pengasih and the DPIS field staff: SDI staff discovered that the FWUA paid a considerable fee to

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the DPIS to prepare21 the proposal. In an SDI staff member’s words in 2004: “Where did the FWUA staff get the money to pay this fee, if not through budget manipulation in its development proposal?”

SECTION V: TARGET-ORIENTED IMT IMPLEMENTATION AND FWUA ORGANIZATIONAL DEVELOPMENT IMT implementation under WATSAL was focused on the achievement of certain predefined targets. Project leaders were expected to transfer a certain number of irrigation systems, form a certain number of FWUAs, and allocate available stimulant funds within predefined timeframes.22 I discuss how the FWUAs had to be rapidly formed and developed according to these predefined project indicators, and how management transfer was reduced to a project target.

Farmer Empowerment and Rapid FWUA Formation Under WATSAL, FWUA organizational development was focused on the “formal” fulfilment23 of predefined project targets. For example, an FWUA had to formally register as a legal farmer organization, possess formal organizational rules, and have an extensive organizational structure. All these FWUA organizational developments resulted in FWUA bureaucratization,24 with all registered FWUAs required to have standardized organizational rules (prepared by SDI staff) and organizational structures, which included a leader, two secretaries, two treasurers, and separate staff each specialized in O&M, rehabilitation, irrigation, and administrative tasks. For all these structures, FWUAs were actually formed quickly, in isolation from both existing WUAs and the district farmers, and district government staff25 arranged the formation of FWUAs. As a DDPA official told me in 2004: We had to form FWUAs quickly to accommodate rapid management transfer. Hence, FWUAs were formed through the district government’s connection with village governments. [This] did not allow either project staff or [the] district government to conduct public awareness properly.

Because many of the WUAs were inactive, village governments generally appointed their own WUA leaders from within its own elite memberships

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and invited one or two farmers to join the newly formed WUA organizational structure. Both district governments and SDI staff would then select FWUA staff from among these appointed WUA leaders; consequently, FWUA formation resulted in the establishment of a new power niche for the rural elite, mainly made up of members of the village government. In Papah, three of the seven FWUA Kongklangan staff members were from the village government and another three were retired civil servants (teachers), with close family connections to village government. A similar situation occurred in the FWUAs West Pekik Jamal, East Pekik Jamal, and Kalibawang. In East Pengasih, the FWUA’s connection with the village government extended up to the district. This closed circuit of power meant that the farmers, whom the FWUAs were supposed to serve, became aware of IMT policy (if they became aware at all) only after the FWUAs were already formed and the formal management transfer conducted. During my field research (from June 2004 to July 2005), none of the thirty farmers I interviewed26 in the seven irrigation systems in the Kulon Progo district were aware of the different FWUAs; it was only in 2005 that the farmer empowerment activities in the WATSAL IMT programme were extended to the tertiary level. The problem was that the IMT programme focused primarily on the formal registration of WUA and FWUA staff and the status of its organizational rules, but not on the farmers’ needs. FWUA bureaucratization created and accommodated the rural elite domination because these elites were better equipped to conduct the FWUAs’ administrative tasks than farmers because of their bureaucratic and administrative backgrounds in village government. In August 2004, the leader of the FWUA Kongklangan, in Papah, said in an interview: The most important requirement to be FWUA staff was one’s administrative capability. Given that the FWUA has to manage the stimulant fund, its staff should be able to write development proposals, financial reports, ISF registration forms, as well as the regular meeting notes.

Management Transfer as Project Targets In its implementation, IMT under WATSAL was reduced to hitting project targets, not meeting real needs. Systems management was transferred from the DWRS to the FWUAs without taking into account the roles of SDI and DPIS field staff in planning, coordinating, and overseeing systems management. FWUA leaders compromised the legal preconditions

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for IMT because they had to spend the total amount of the allocated stimulant fund within the defined timeframe, no matter the farmers’ or irrigation systems’ needs. According to the systematic framework for IMT implementation, stimulant funds could only be allocated to an FWUA after formal management transfer from the district government. The need to move quickly was expressed in 2004 by a FWUA staff member in West Pengasih: “An FWUA was eager to receive the formal responsibility for systems management because [it] would enable … manage[ment] [of] the stimulant fund”. In the same year, a manager of the SDI said in an interview, “Under WATSAL, IMT was treated as a development indicator … [and] precondition for the channeling of stimulant fund”. At issue, however, was that the legal precondition only stated that the transfer of management authority had to occur, but it failed to define which organization would handle the multitude of tasks among the FWUAs, the SDI, and the DPIS. In the Kulon Progo district, for example, the first efforts to define these actors’ tasks and roles27 were initiated only in early 2004, which was approximately four years after the formal management transfer of the seven technical irrigation systems. Rapid management transfer was also partly driven by WATSAL policymakers’ concern that Kimpraswil would regain its bureaucratic power and halt the ongoing policy implementation, as eventually started to happen in 2003. A key policy actor in WATSAL told me in a 2003 interview: “If IMT was … conducted gradually … Kimpraswil would transform IMT under WATSAL to fit its bureaucratic interests”. Their preference for speed might endanger farmer empowerment, but these actors were convinced that this was better than allowing IMT to be implemented too slowly or waiting until farmers were ready to take over management. One common thought was that farmer empowerment could still be undertaken after the systems were formally transferred. Consequently, rapid implementation of IMT policy in the Kulon Progo district was aimed at (successfully) preventing Kimpraswil from redirecting water policy back towards recentralization.

SECTION VI: COMMUNITY ORGANIZER RECRUITMENT — A REFLECTION OF THE PROJECT DEVELOPMENT APPROACH The need for creating the position of COs in 2000 reflects how WATSAL IMT programme implementation was overwhelmed by project procedures and mechanisms. The COs, however, were viewed as a financial waste by

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policy actors at the district level; starting in 2005, their employment was continued only because project funds had to be spent. This section details the history of this position.

Who Needs a Community Organizer? The recruitment of the COs started in 2000, and the role was to guide and facilitate FWUA organizational development. Initially, COs were recruited from outside the FWUAs and SDI organizational structures, emphasizing its neutral position as the third party between FWUAs and SDI, and the position required that the CO hold a bachelor’s degree in agriculture. Eventually, however, the advanced degree was scrapped because WATSAL policy-makers thought that those with higher education did not necessarily function any better than those without any academic training. Allowing this change also meant that any FWUA staff member could easily be recruited from within to become the FWUA’s CO, which is exactly what happened at many FWUAs. CO employment was paid for by project fund disbursement. At the district and FWUA levels, almost everyone objected to CO employment. As expressed by one FWUA Kongklangan staff member in May 2004: “An FWUA did not need a [high-priced] CO …. it is not clear what the added value was for the FWUA staff.” The SDI also did not see the need to spend project funds on CO employment, with one SDI employee telling me in 2004: Nobody ever expressed their need to have a CO. Even when the CO was introduced, no one saw the actual use of their role in IMT. Nevertheless, COs were recruited everywhere because the project leaders thought that these COs might be useful to improve FWUAs’ organizational development in IMT.

The COs were trapped in the power struggle between the FWUA, SDI, and DPIS. For example, when one CO tried to follow the SDI’s instruction to focus on the ISF collection rate, the DPIS criticized his lack of involvement in irrigation practices in the field. Conversely, when another CO focused his efforts on increasing the FWUA’s role in water distribution activities, both the SDI and DPIS blamed him for being unable to increase the ISF collection rates. The COs’ role was often misused because the position lacked bureaucratic support from their district government (the person handling irrigation projects at the provincial level was the CO’s supervisor).

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Several COs told me in August 2004 that FWUA staff often gave them proposals to prepare, while in other cases DPIS field staff wanted the COs to undertake O&M tasks. If they refused any task thrown at them, they would be accused of being uncooperative and arrogant. In addition, a CO was often viewed as a potential competitor by the DPIS field staff. In fact, CO employment had eliminated DPIS field staff’s main informal sources of income: a considerable fee from FWUAs for preparing proposals and for writing the financial reports on stimulant fund management. With the introduction of the CO in 2000, more FWUAs used their COs to undertake the reporting work to avoid the DPIS fees. According to interviews with COs in the Kulon Progo district in 2004, the problem was that a CO had to go through the many DPIS bureaucratic procedures to garner the needed information to write the report; for example, the data on WUA staff or ISF collection rates.

CO Employment after 2005 CO employment was continued only because project funds had to be spent. Prior to the water policy debates, Sarjio, the project leader responsible for achieving IMT targets, had proposed CO employment, along with activities to strengthen FWUA organizational functioning as part of the NewISF programme. After Kimpraswil managed to end the WATSAL IMT programme through its political clout, CO employment was the only project activity to receive funding from the MoHA. The SDI proposed that the project leader should disburse the project funds directly to the FWUAs and to let these FWUAs decide how they will use the funds instead, not necessarily to cover CO salaries. However, the project leader insisted on CO employment. After 2005, the COs were given a specific task: focus on the formal establishment of the WUAs. This included updating each WUA’s legal and administrative status and encouraging the establishment of regular WUA staff meetings. A CO was expected to reach the following three targets: renew WUA staff within a certain defined time period, even if these staff had never been functional (or actually existed); ensure that new staff have the opportunity to redefine the existing organizational rules, as initially defined by the SDI staff; and register all WUA activities, even if no one seemed to know how this registration might be useful for the WUAs or the farmers. COs found it extremely difficult to meet these criteria because, in reality, the WUAs existed only on paper. In most cases, after several

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attempts, a CO might manage to identify the registered WUA leaders while its staff remained unidentified, or rather, non-existent. Furthermore, a CO was neither mandated to improve the organizational link between the WUAs and their FWUAs nor to direct WUA organizational functioning towards a broader context of development outside of irrigation practices. For example, I observed during a CO coordination meeting in August 2004, the CO in Kalibawang approached the FWUA staff to initiate an FWUA–WUA dialogue about the cost of small repairs already conducted. Instead, the project leader at the district level advised the CO to focus mainly on improving the formal functioning of the WUAs. When the CO asked whether to include farmer activities in agricultural projects as part of the WUA empowerment programme, he was once again told to focus his attention on the role of the WUAs in irrigation systems management.

CONCLUSION The incorporation of IMT policy under WATSAL into regional autonomy clearly resulted in fragmenting the irrigation bureaucracy, changing the line of command and reshaping the pattern of alliances in the irrigation sector’s development. With the incorporation of the DPIS into the DWRS, Kimpraswil lost its representatives at the district level. This bureaucratic fragmentation is clear, for example, from the decision made by the Kulon Progo district to continue with the WATSAL IMT programme. Apart from its ability to freeze sectoral development fund disbursement, Kimpraswil lacked any bureaucratic power to steer the SDI with regard to the WATSAL IMT programme. The Kulon Progo SDI’s decision to continue with the WATSAL IMT programme was rooted in its ability to sustain its bureaucratic identity amidst the overall process of management transfer and the farmer empowerment programme. The preservation of this identity allowed the SDI to direct FWUA organizational development towards infrastructureoriented development. In the process, the Kulon Progo FWUA simply became a replica of the SDI. It has been discussed, and proven, that the WATSAL IMT programme failed to eradicate the practice of rent-seeking. On the contrary, the fact that the IMT programme was implemented only through the project approach resulted in rent-seeking practices transferring from the irrigation agency to the FWUAs, mainly because of each FWUA’s financial interests in receiving stimulant funds. However, the FWUAs’ access to the stimulant

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funds did not result in greater representation of farmers’ needs in irrigation system management. Rather this access only linked the FWUAs to the rent-seeking cycle rooted in the management of project funds, despite the intention of the WATSAL policy-makers to use the FWUA as a platform to empower farmers. Comparable to IMT implementation under the IOMP 1987 Statement, IMT under WATSAL continued to be manipulated by government agencies, this time by the SDI, as the district irrigation agency, and each FWUA. The WATSAL IMT programme failed not only to address farmers’ actual development needs, but also to eliminate farmer dependency on government funding support. Instead, the FWUAs’ access to the stimulant funds preserved the “cyclical relationship of codependency”.28 As both the FWUAs and the SDI based their organizational functioning on government funds support, IMT was once again caught in the vicious cycle of bad construction–deferred maintenance–early rehabilitation. Ironically, FWUAs’ access to the stimulant fund had been designed to eradicate these very rent-seeking practices. That this plan backfired proves that the implementation of the WATSAL IMT programme was shaped primarily by the policy actors’ needs to satisfy their own interests. IMT policy under the WATSAL programme was manipulated by both the FWUAs and the SDI, and the programme’s formulation and implementation were linked by the decisions and actions of these actors. In short, it was not only in its formulation that the WATSAL IMT programme continued to be contested, but also in its implementation. The implementation of the WATSAL IMT programme through the project approach limited the scope of IMT to that of a policy blueprint. The WATSAL policy-makers’ attempt to reform the irrigation sector was trapped in the massive project structure, which was the vehicle for moving the policy programme from the national to the regional level. Like in the IOMP 1987 Statement, IMT implementation under WATSAL was limited by project procedures that had to be followed and targets that had to be reached. IMT policy was reduced to a bureaucratic, administrative exercise because its implementation was monitored exclusively through project reports made by the project leader at district level. No attention was given to how the IMT programme was perceived by the stakeholders — in this case, the farmers. From this perspective, IMT implementation under WATSAL was similar to the construction and rehabilitation programme conducted under the IOMP 1987 Statement. IMT under WATSAL only resulted in FWUA bureaucratization, in which

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organizational development was directed towards its administrative ability to meet the defined project procedures, regardless of how farmers needed or perceived of any project activity.

Notes   1. Regional autonomy did not include a fiscal transfer from central to regional governments. Hence, the central government remained the main financial overseer of regional development activities.   2. WISMP was activated in early 2006.   3. I could not include Central Java in my analysis because PIA and PIP officials had strong opposition to the WATSAL IMT, even refusing to be interviewed on the subject. In Central Java, IMT implementation never included the transfer of management authority from the government to the FWUAs; the focus was on rehabilitation and construction activities.   4. The PTGA unit was formed in the late 1980s and was assigned the task of training and empowering farmers in irrigation systems management. Both at the national and provincial levels, however, PTGA officials lacked the political connections needed for involvement in construction and rehabilitation projects.   5. In my opinion, the support of the PIP leader would have enabled the PIA leader to continue with IMT implementation, even though the majority of the PIA officials did not support him.   6. The PIP leader used Kimpraswil’s argument to justify his decision: IMT would only give farmers an extra financial burden.  7. The PIA leader’s opinion — that the regional government’s position on IMT should be based on farmers’ needs — was shared with the former leader of PIP. In an interview in Yogyakarta in 2004, the PIA leader counterargued Kimpraswil’s assumption on farmers’ lack of management skills by questioning the same skills of the irrigation bureaucracy at all levels to adapt to its new role, as proposed under WATSAL. “Development in the irrigation sector should be oriented towards the representation of farmers’ needs, and thus the need to change the development mindset of the government bureaucracy. But, in general, most government staff were not ready to make this change. Instead, they were worried about their future role in irrigation management. They used to confuse farmers through their overlapping instructions, and hence when farmers were independent and knew what they had to do, these government staff were the ones who got confused”. She thought that regional governments could have used these moments of policy confusion to rethink the actual meaning of management transfer within the overall context of regional development (e.g. the direction that IMT policy

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would take farmers and how the regional governments saw its role in this process).   8. Provincial government staff working at the district level implemented IMT first under the IOMP, and then under the pre-WATSAL JIWMP.   9. The DPIS was never abolished at the district level, unlike its demise at the provincial level. The decision to retain it at the district level was based on concerns that a bureaucratic vacuum might occur following its abolition at that level. At the district level, such a vacuum might lead to a massive delay in development at the provincial level. Given that the provincial governments’ role in irrigation sector development was that of coordinator and facilitator, it was thought that district staff could just as easily fulfill these roles. 10. The transfer of certain key decision-makers from the former DPIS to the SDI accommodated the bureaucratic transformation taking place alongside the WATSAL IMT implementation. For example, both the head of Water Resources in the DDPA and a key actor in the SDI were former DPIS staff. Because their new bureaucratic positions were shaped by their relationships and interactions with policy actors at the district level, they could transfer their loyalty from Kimpraswil to their district government. 11. The Irrigation Committee was formed under WATSAL, mainly to replace the existing Irrigation Administration at the district level. Different government institution leaders (from the DWRS, DDPA, Department of Agriculture, and FWUA) were represented within the Irrigation Committee. The formal role of this committee was to coordinate irrigation development activities at the district level, in general, and to monitor the WATSAL IMT implementation, in particular. In Kulon Progo, the Irrigation Committee began in mid2003. 12. District Water Resources Services of Kulon Progo, 2003, “Evaluation on WUAs Activities in Kulon Progo District”. 13. SDI’s ability to receive funds from the district government was conditioned by its good relationship with policy actors in the DDPA. 14. In my opinion, the competition reflected the way that district-level government still treated the FWUAs primarily as government policy instruments that needed to improve its organizational functioning. By highlighting particular healthy FWUAs, it was hoped that other FWUAs might learn by example. However, when a particularly well-functioning FWUA was declared the winner of the competition, it remained unclear how this could solve the organizational problems of the other FWUAs. 15. WATSAL, “Systematic Framework for IMT Implementation”, paper presented at the WATSAL IMT Meeting in Bali, 5–10 October 2003. 16. IMT under WATSAL remained trapped in the infrastructure-oriented development paradigm during its implementation. Even if the transfer of

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decision-making authority for fund management proved effective in eradicating bureaucratic rent-seeking practices, the eradication would not necessarily enable the FWUAs to physically manage the irrigation systems to meet farmers’ development needs. 17. Such collaborations also strengthened FWUAs’ corruption practices by involving as many people as possible. 18. If WUA staff were involved in decision-making processes, it was because they were also FWUA staff. 19. Apart from their efforts to confuse FWUA staff, SDI staff even “taught” FWUA staff how to manipulate the stimulant fund management. For example, during a meeting with an FWUA in Sapon, SDI staff asked the FWUA staff their preference: construct a smaller project, keeping the same material composition, or construct according to the project’s proposed size, but reduce the amount of cement in the construction material composition. The FWUA staff chose the first option to ensure construction quality. However, SDI staff suggested the second option, so that when the project was audited, the analyst monitoring the implementation would not discover anything peculiar, since the construction materials matched the proposed size. 20. As with so much corrupt behaviour exhibited by so many people, I discovered that the approval was linked to the close relationship between the FWUA leader and an SDI staff member. 21. From interviews with FWUA staff and DPIS staff in 2004, I learned that cooperation between many FWUAs and DPIS field staff was quite common. Some of the FWUAs in Sapon (the FWUA Wonokasih, in particular) even delegated all paperwork in relation to stimulant funds to former DPIS field staff. 22. JIWMP–IDTO, Progress Report: Twenty-eighth Quarterly Period (April–June [August]) 2002. The Netherlands, DHV Consultants BV. Target-oriented IMT implementation was evident from the 5 December 2003 presentation in Jakarta by the PIA leader in West Java during the MoHA national seminar on IMT. In his presentation, the PIA leader focused on the achievement of IMT policy targets: the number of irrigation systems transferred (in hectares), the number of FWUAs formed, and the amount of development funding spent on system rehabilitation as part of IMT preparation. 23. I use the words formal and formally to emphasize the fact that these targets were met only on paper. 24. The term bureaucratization refers to the way SDI directed FWUA organizational development, following the irrigation agency’s organizational structure and development path. 25. Different policy actors from the SDI and the DDPA presented the difficulty of organizing farmers and the non-functioning WUAs as their main argument

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for limiting the process of FWUA formation only to several key actors within the village government structure. 26. These interviews were conducted randomly at the beginning, middle, and end of each irrigation system. 27. It should be pointed out that the Kulon Progo district government in the end postponed the discussion on task redefinition because of stagnant funds disbursement from the central ministries, leaving the available development funds from regional revenue for priority activities only, such as systems repair and maintenance. 28. Douglas L. Vermillion et al., “An Assessment of the Small Scale Irrigation Management Turnover Program in Indonesia: Research Report 38” (Colombo: IWMI, 2000), p. 26.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

7 IMT AND WATER DISTRIBUTION PRACTICES IN THE KULON PROGO DISTRICT

INTRODUCTION This chapter gives specific details on how the Water Sector Adjustment Loan (WATSAL) Irrigation Management Transfer (IMT) programme shaped the overall water distribution pattern in the seven technical irrigation systems in the Kulon Progo district from June 2004 to July 2005. Moreover, it describes both the domination of the rural elite in running the Water Users Associations (WUAs) and Federation of Water Users Associations (FWUAs) and the subsequent unbalanced FWUA–WUA–farmer relationships. An explanation of the interconnected irrigation systems in Kulon Progo is presented in Section I. Section II discusses how the WATSAL IMT programme reshaped inter-system water distribution rules and how the Sub-Division of Irrigation (SDI) tried to cope with this change. In Section III, I present the dominant patterns of alliances in water distribution; and the establishment of spatial authority is explained in Section IV. Section V illuminates the rural elite’s domination in the FWUAs and WUAs. Section VI describes the different types of elite leadership that emerged in Kulon

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Progo’s seven technical irrigation systems, and how the elite’s management could either shape farmer-elite relationships towards greater representation of farmers’ needs in water distribution, or be self-serving, while Section VII highlights how the elite’s domination in FWUAs thus shaped WUA behaviour. Section VIII gives life to these behaviours in detailing how a single person at the WUA Suka Maju in West Pekik Jamal shaped water distribution in a particular tertiary unit.

SECTION I: GENERAL DESCRIPTION OF IRRIGATION SYSTEMS IN THE KULON PROGO DISTRICT The irrigation systems in the Kulon Progo district consist of small-scale (mostly smaller than 1,000 hectares), run-off-the-river systems, which are interconnected through networks of irrigation and drainage canals, as well as river tributaries. Each irrigation system’s location and their interconnection are presented in Figure 7.1. Technically, irrigation systems in this interconnected system were divided into three jurisdictional areas, with each area operating under the authority of either DPIS (Division of Provincial Irrigation Services) 1, 2, or 3. DPIS 1 was responsible for the operation of the Pekik Jamal and Sapon irrigation systems; DPIS 2 was responsible for the irrigation systems of Papah, East Pengasih, and West Pengasih; and DPIS 3 was responsible for the Kalibawang, Penjalin, and Donomulyo irrigation systems. After IMT, DPIS field staff retained in their position as system operators. An overview of each irrigation system in Kulon Progo is presented in Table 7.1, and the hydrological/technical inter-system connection is presented in Figure 7.2. Upstream of this interconnected system, Kalibawang gets its irrigation water directly from the Progo River.1 The flow (7 m3/s) that enters the Kalibawang intake is also used by irrigation systems located downstream. The Kalibawang irrigation system is divided into two water management units, Kalibawang I and II, each with an FWUA responsible for its irrigation management. Unlike in other systems, all tertiary intakes in the Kalibawang system are directly linked to the main canal, since there are no secondary canals. Both FWUAs’ organizational boundaries were defined by dividing the length of the main canal. At the end of this main canal, both the remaining irrigation water and the incoming drains from the Kalibawang system are collected and regulated in the Kemukus division structure for

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FIGURE 7.1 Operational Boundaries of the Seven Technical Irrigation Systems in Kulon Progo

Division structure Dam River Canal DPIS1 DPIS2 DPIS3

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TABLE 7.1 Overview of Technical Irrigation Systems in Kulon Progo District Irrigation system Kalibawang Donomulyo Penjalin Papah East Pengasih West Pengasih Pekik Jamal Sapon

Size (hectare)

Number of FWUAs

Number of WUAs

Number of DPIS staff

Golongan system

Location

1,488 534 652 983 671 1,329 868 1,800

2 1 1 2 1 1 2 3

41 18 12 16 15 20 15 36

2 1 1 1 2 2 2 2

1 1 1 2 1/2 2 1/2 1

Upstream Upstream Upstream Mid end Mid/tail Tail end Tail end Mid end

further distribution to the downstream systems. These irrigation systems are located in the south-east (in Donomulyo, Penjalin, and Papah) and in the southwest (in East Pengasih and West Pengasih), and irrigation water is channelled directly to the south-east irrigation systems through a canal network. In the south-west irrigation systems, irrigation water is channelled through a network of natural drainage (the Anak Serang tributaries), before it is “caught” back into the irrigation canal in the Pengasih system. This connection combines irrigation water supply from the Kemukus, with additional water from existing river tributaries. For the south-east irrigation systems, water is first channelled to the Donomulyo irrigation system through an intake. Shortly after the intake, water flows first to the Penjalin system and then to the Papah system, through dams located upstream of each system. Upon entering the Papah system, irrigation water is directly divided between two secondary canals, each managed by an FWUA. Lower in the system, drainage water from Papah again reconnects the south-east system with the south-west system. This water runs to the Pengasih irrigation system through Papah River tributaries. For the south-west systems, the district government operates a reservoir to ensure irrigation water supply to the Pengasih and Pekik Jamal irrigation systems.2 Upstream of the Pengasih dam, three small village irrigation systems3 (each under 200 hectares) take the irrigation water released from the Sermo reservoir and water from Kalibawang, including water added by the Sumitro river tributaries. Passing these village irrigation systems, the water is “caught” back into the irrigation canal in Pengasih. At the end of the Pengasih main canal, there is another division structure

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FIGURE 7.2 Hydrological/Technical Inter-System Connection in Irrigation Systems Management

Dam Division structure Main intake

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(Beji) to divide the irrigation water supply between East Pengasih and West Pengasih. The Beji division structure is a proportional one (discussed below). As for the Pekik Jamal irrigation system, it gets its water supply through the irrigation canal in East Pengasih, as well as drainage water from the East Pengasih and Papah irrigation systems, channelled through the extension of the Sumitro River and Serang River tributaries (which are also connected to Papah River tributaries). However, in the event of water scarcity, additional water can be released from the Sermo reservoir to East Pekik Jamal. The Sapon irrigation system takes its water directly from Progo River, with its direct intake located approximately 34 km downstream from the Kalibawang intake. The overview of the inter-system water delivery schedule is presented in Table 7.2. Working relationships among those responsible for water distribution is essential for the management of these interconnected irrigation systems. Additionally, the fact that each system’s water supply is related both technically and naturally to the other systems’ water supplies reflects a high degree of technical complexity for overall systems management. However, the absence of a water balance at the inter-system level highlights the presence of a permanent technical handicap in the interconnected run-off-the river irrigation systems: the amount of water discharge recorded at any dam does not capture the link between upstream and downstream water supply because irrigation water from upstream systems and existing river tributaries are mixed before they entered the dams. The way these irrigation systems are interconnected makes it extremely difficult, if not impossible, to measure the actual water discharge from all the existing river tributaries in the area. Practically, but also technically, it is impossible to station measurement structures in each river tributary and natural drainage channel. Nevertheless, the coexistence of the two networks of water supplies — irrigation canals and river tributaries — in interconnected irrigation systems increases the irrigation systems’ efficiency and allows for the application of more flexible irrigation management. In interconnected irrigation systems, irrigation water can be used more efficiently because drainage water from upstream systems can be reused to irrigate agricultural land in downstream systems. Similarly, the possibility of transporting water to any area increases when there are more water sources. For example, during the dry season, drainage canals in upstream systems are converted to irrigation canals to transport water to downstream areas. In

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TABLE 7.2 Overview of the Water Distribution Schedule at the Inter-system Level Irrigation infrastructure

Amount of targeted discharge

System operator

Task

Kalibawang intake

7 m3/s

Zainuddin from DPIS 3

Responsible for overall water distribution in the Kalibawang, Penjalin, and Donomulyo systems.

Kemukus division structure

3 m3/s

Budiman from DPIS 3

Responsible for operating the Kemukus division structure. Water entering Kemukus should be divided equally between the Papah and Pengasih irrigation systems.

Beji division structure

1.5 m3/s

Chaerul from DPIS 2

Responsible for overall water distribution in the Pengasih irrigation system. From Beji, water is distributed to East Pengasih and West Pengasih irrigation systems proportionally. Chaerul is supported by two field staff.

Papah dam

1.5 m3/s

Darul from DPIS 2

Responsible for operation of the gate in the Papah dam. Water is then channelled to secondary canals in Kongklangan and Cangkring Mulyo.

Pekik Jamal dam

0.8 m3/s

Eka and Farid from DPIS 1

Eka: responsible for operation of the gate in Pekik Jamal dam. Farid: responsible for overall water distribution in Pekik Jamal and Sapon irrigation systems.

Sapon dam

1.5 m3/s

Gareng from DPIS 1

Responsible for operation of the gate in Sapon dam.

Note: All names are pseudonyms.

interconnected irrigation systems, the concept of water control4 is applied in a broader, more horizontal, and less hierarchic management context. Also, each system’s capability to “store” water is spread over the entire system, rather than concentrated at certain technical infrastructures, such as dams or reservoirs.

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In Kulon Progo, two golongan (the defined cropping calendar for reducing the irrigation peak water demand) systems are used to cope with the peak water demand during the dry season between April and October. The golongan system started in 1985, though the currently applied rotation schedule has only been in place since 1990. Apart from each system’s location or water availability from both the Sermo reservoir and the Progo River, how the golongan system is defined includes factors such as how field-to-field irrigation is practised, possible flooding5 in certain areas of these systems, and village boundaries6 within each irrigation system. Golongan I covers approximately 4,800 hectares of irrigated land in mostly upstream systems,7 while Golongan II includes mainly the mid- and downstream irrigation systems,8 and covers approximately 3,400 hectares of irrigated land. The overview of the golongan systems is presented in Figure 7.3. Officially, farmers within Golongan I start their first paddy crop in August or September. After the first harvest in December or January, their second paddy season is between January and May. Between May and July, farmers in Golongan I cultivate dry crops. In Golongan II, these farmers start their first paddy crops in November or December (at the start of the rainy season) and complete it between March and April. The second paddy season is between April and August, followed by the cultivation of dry crops between September and November. In this way, prior to the start of the rainy season between August and September, theoretically, water supply from both the Progo River and Sermo reservoir would be used to irrigate systems only in Golongan I. Similarly, at the beginning of the dry season in May, water supply is solely channelled to farmers in Golongan II because farmers in Golongan I have harvested their second paddy crop. See Figure 7.4 for the division of the two golongan. FIGURE 7.3 Overview of the Golongan System in Kulon Progo District Rainy season AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL GOLONGAN I GOLONGAN II

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PADDY DRY

PADDY PADDY

DRY PADDY

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FIGURE 7.4 The Official Division of the Golongan System for Technical Irrigation Systems in Kulon Progo District

Kulon Progo district

,. . . ... . ... . . ___..,·\. ·" ,· ...... '·"" ~

."

I

.'

' I

D

Go/onganl

Q

Golongan II 2

0

I

\ /

·, \

4 km

r I /

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Prior to the implementation of the WATSAL IMT programme, IMT had already been introduced in the seven technical irrigation systems in the Kulon Progo district under the Irrigation Operation and Maintenance Project (IOMP) 1987 Statement. Under the IOMP, WUAs were formed at the tertiary level, with activities supposedly focused primarily on the so-called participatory design and rehabilitation programme, as well as irrigation service fee (ISF) collection.9 Incorporated in the WUAs was the village ulu ulu (the person in charge for water distribution arrangements), whose task was to arrange irrigation water distribution for farmers, even prior to the WUA formation.10 However, apart from the ulu ulu, the WUAs’ rural elite barely represented farmers’ development needs. In rural Java, there were two different types of elite groups.11 The first group was the village priyayi. Its access to agricultural lands as major landowners and their decisionmaking authority as village government members prove the importance of this group though this group also included (retired) civil servants (such as teachers and staff from varying village-level government ministries). With the farmers, the priyayi had an owner–tenant relationship. The second group of rural elite was called the “rural entrepreneurs”. The power of this group was rooted in its ability to invest in their own agricultural practices, such as better seeds, fertilizers, and pumps. This group included wealthy commercial farmers, who only get involved in activities that might bring reap financial benefits for themselves. In the Kulon Progo district, the domination of these two powerful groups was apparent in all FWUA organizational structures, though the rural entrepreneurs were most dominant in upstream FWUAs (Kalibawang, Penjalin, and Donomulyo).

SECTION II: IMT AND WATER DISTRIBUTION AT THE INTER-SYSTEM LEVEL I now turn my attention to how IMT in the Kulon Progo district did not result in the transfer of decision-making authority for water distribution practices to either system level WUAs (SWUAs) or FWUAs. I also discuss the SDI’s attempt to cope with the inter-system water distribution practices after management transfer.

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IMT and Farmers’ Decision-Making Authority for Water Distribution SWUAs’ and FWUAs’ decision-making authority, with respect to water distribution, was restricted by the continuing presence of DPIS field staff. After the formal transfer, all three DPIS were to be replaced by SWUAs and FWUAs; however, the DPIS remained in charge of the actual operation of key irrigation infrastructure at the system level. This eventually led to the SWUAs losing its raison d’être and overshadowing the FWUA’s role in water distribution because they lacked the decision-making authority to define the amount of water that entered into the irrigation system. The DPIS’ importance in overall systems management not only impeded the establishment of inter-SWUA/FWUA relationships but also actually hampered the delegation between the SDI and FWUAs. Under WATSAL, the SDI staff were responsible for facilitating the establishment of SWUA–FWUA relationships that were to be essential in shaping water distribution practices at the inter-system level. Through these relationships, the SDI should have been able to direct the SWUAs to operate the irrigation infrastructure at system levels, in accordance with the agreed inter-system water delivery schedule. In practice, the SDI could never fine-tune the actual operation of the irrigation infrastructure because the DPIS made the SWUAs dysfunctional. In turn, the SDI could not then delegate water distribution tasks to the FWUAs because the FWUAs were not in charge of the actual operation of the irrigation infrastructure. In addition, the SDI could not integrate DPIS field staff into the overall systems management plan because the SDI lacked the bureaucratic power to manage DPIS field staff. At the inter-system level, the SDI defined the water distribution plan; yet at the system level, the three DPIS were in charge of operating the irrigation infrastructure, no matter the water distribution plan. Meanwhile, the FWUAs were supposed to arrange water distribution at the secondary level, but they were not linked to the inter-system level water delivery schedule. Operation at the Kemukus division structure is proof of how this fragmented authority lead to rogue decision-making. This particular division played a central role in shaping the actual water distribution between upstream, mid-, and downstream irrigation systems. The way irrigation water was distributed through the Kemukus division structure

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(to the south-east and south-west) was essential in ensuring equal water distribution between all irrigation systems located downstream from Kalibawang. Prior to IMT and regional autonomy, the DPIS 3 discussed operation of the Kemukus division structure with the SDI (as both were part of the Provincial Irrigation Project or PIP), for example, to regulate inter-system water distribution by targeting the amount of discharge that should enter the Kemukus division structure. When the amount of water in the Kemukus structure was below 3 m3/s, DPIS 3 was to close intakes in the upstream system (Kalibawang) to allow irrigation water supply to the downstream systems. However, after IMT, the Kemukus division structure was operated without any link in distribution arrangements. DPIS 3 would frequently send more irrigation water to the Papah irrigation system than to Pengasih simply because of Zainuddin, who was responsible for water distribution in the Kalibawang, Penjalin, and Donomulyo systems, had a close relationship with farmers in the Papah area.

The Ten-Day Water Distribution Meeting In mid-2003, three years after IMT under WATSAL was officially implemented in the Kulon Progo district, the SDI introduced ten-day water distribution meetings (meetings to take place every ten days), which were intended to integrate the three DPIS into the overall systems management plan and to encourage the establishment of inter-FWUA relationships.12 This meeting was also intended to create a decision-making platform to coordinate water distribution efforts at the inter-system level by involving all actors. The meetings took place at the SDI office in Wates, and the water distribution schedule in relation to the actual water needs was discussed (water needs as proposed by the FWUAs’ and DPIS field staff). At the end of each meeting, an agreement was to be made on how to coordinate the overall system water distribution. In practice, these ten-day water distribution meetings failed to incorporate DPIS involvement into the overall water distribution and to re-establish SDI’s authority to direct the conduct of the three DPIS. For example, during a ten-day water distribution meeting in May 2004, a DPIS 1 staff member publicly questioned the importance of these meetings, saying: “If the agreed water distribution plan cannot be materialized to solve water scarcity problems in the downstream irrigation systems, then, what is the actual importance of this meeting?” SDI staff agreed that without

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cooperation from both FWUAs and DPIS, the SDI’s efforts to ensure equal water distribution was indeed marginal (field notes, 11 May 2004). None of the DPIS followed the SDI’s water distribution schedule because they did not view the SDI as their bureaucratic superior. For example, in May 2004, the SDI proposed to DPIS 3’s Zainuddin (who is in charge of irrigation systems infrastructure in Kalibawang, Penjalin, and Donomulyo) that he closed the gate at the Kemukus Wudu secondary canal (located downstream of Kalibawang main canal) to have more water flow to the West Pengasih and West Pekik Jamal irrigation systems (field notes, 4 May 2004 at a ten-day water distribution meeting). According to the SDI, irrigation water should be fully channelled to downstream irrigation systems since, based on the actual crop condition in the fields as observed by an SDI staff member and on the applied golongan system, farmers in the Kalibawang system should no longer need irrigation water. However, Zainuddin refused to close this gate for at least another week because, according to him, farmers in his area still needed irrigation water. He challenged the SDI’s opinion, saying that when farmers had not yet closed their intakes, it meant that they still needed the irrigation water. Then Zainuddin refused to address farmers’ illegal water off take in his area, saying: “Farmers still need water, no matter how often I close their gates, they will reopen them again” (field notes, 4 May 2004, at a ten-day water distribution meeting). In addition, Zainuddin used several severely damaged secondary gates as proof that, even when he closed the gates, farmers would try to reopen them, sometimes damaging them in the process. At the end of the meeting, the SDI agreed to release additional water13 from the Sermo reservoir to the West Pengasih and West Pekik Jamal because they were unable to force Zainuddin to follow the water distribution schedule. At the next ten-day water distribution meeting, the SDI repeated their concern about farmers’ illegal water activities in the Kalibawang system, particularly because the amount of discharge that was entering the Kemukus division structure was still below the defined target (it was 1.9 m3/s, not 3 m3/s). Zainuddin continued to insist that the farmers in his area still needed irrigation water. When the SDI asserted that most farmers in the Kalibawang system were ready to harvest their second paddy crop, Zainuddin remained firm that he could not close the gate at the Kemukus Wudu secondary canal. Zainuddin’s “inability” to stop farmers’ illegal water taking in Kalibawang was rooted in his alliance with the FWUA in that irrigation system, who wanted the gates

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to remain open. The SDI could do nothing but channel additional water supply from the Sermo reservoir to both the West Pengasih and the West Pekik Jamal areas. DPIS field staff would also violate agreements made in the ten-day water distribution meetings because the SDI could neither enforce the agreements nor penalize any violations. For instance, in September 2004, Chaerul (from DPIS 2) violated the agreement made between the SDI, DPIS 1, and FWUA East Pekik Jamal to allow additional water supply14 from the Sermo reservoir to farmers in the East Pekik Jamal area. Agreement with Chaerul was necessary because irrigation water would be transported to the East Pekik Jamal area by bypassing the irrigation canal in the East Pengasih irrigation system. Chaerul, however, channelled the additional irrigation water to East Pengasih before it could reach East Pekik Jamal. During the next ten-day water distribution meeting, the SDI asked Chaerul about the remarkably high level of water in the secondary canal in the East Pengasih area; the canal was so full that the water level had almost caused flooding. Chaerul denied involvement in this illegal water-taking, and, in the end, the SDI managed to send the additional water supply to the East Pekik Jamal area only by secretly creating an alternative “water path” from Sermo reservoir to the area, without informing Chaerul. Once released from the reservoir, irrigation water would flow into the natural drains through one of the spillways in the East Pengasih secondary canal. Thus, although the water would still pass the secondary canal in upstream Pengasih, it would not stay for long in this canal. In this way, water was transported to the East Pekik Jamal area without the risk of being stolen by farmers in East Pengasih. The overview of both the original and the alternative water channelling path is presented in Figure 7.5. The SDI deliberately approached the officials from the Sermo reservoir to release the water earlier than planned. The FWUA East Pekik Jamal, being informed by the SDI about the strategy, agreed to closely monitor the water flow. Afterwards, Chaerul complained that he had been not informed about this change (field notes, 11 September 2004, ten-day water distribution meeting). Apart from its failure to re-establish a bureaucratic connection with the three DPIS offices, the SDI was also unable to establish inter-FWUA relationships or to involve them in system-level operations. The tenday water distribution meetings functioned primarily as a platform for the FWUAs to propose water requests to the SDI; this means that each

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FIGURE 7.5 Water Channelling Path from Sermo Reservoir to East Pekik Jamal Sermo reservoir

Sermo reservoir

Beji

Pengasih

Beji

Pengasih

stealing East Pengasih East Pengasih Pekik Jamal

Pekik Jamal

FWUA representative would only attend meetings during the period when irrigation water was needed by farmers in their respective irrigation systems. The upstream FWUAs (Kalibawang, Donomulyo, and Penjalin) were only present during the meetings in August and September to ensure irrigation water supply during the start of their first planting seasons. Mid- and downstream FWUAs (West Pengasih, East Pengasih, and Pekik Jamal), on the other hand, were only present during the meetings in May and June, to ensure water supply for their second crop planting. The representatives from the FWUAs in the Sapon irrigation system hardly attended any of these meetings because of massive technical problems15 in the Sapon dam in early 2004. The FWUAs functioned in isolation from each other, regardless of the hydraulic position in the inter-system, and FWUA water requests were proposed in isolation from the overall water distribution arrangement. Downstream FWUAs did not relate their water scarcity problems to upstream FWUAs’ inability to control water theft by their farmers, and FWUAs from mid- and upstream irrigation systems did not link farmers’ excessive water abstraction with water scarcity problems in the downstream systems. Upstream FWUAs lacked any interest in reducing water use in their areas in response to hearing from the SDI about downstream farmers’ water needs because they were primarily concerned with their own irrigation needs. Meanwhile, downstream FWUAs that addressed their water scarcity problems to the SDI did not first attempt to counteract

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upstream FWUAs’ role in illegal water taking or trying to negotiate water needs directly with them. This isolation is clearly observed in how the FWUA West Pengasih coped with water distribution practices during the dry seasons in May and June 2004. Farmers in West Pengasih suffered from water scarcity, apparently caused by excessive water usage by farmers in the Kalibawang irrigation system, as well as by unequal water distribution between the Papah and Pengasih irrigation systems. Yet, the FWUA West Pengasih did not link their water scarcity to this, so rather than trying to fight for higher distribution, they relied on manoeuvring that the water that they did receive in such a way as to meet farmers’ needs. In most cases, this was attempted through rotation at secondary and tertiary canals, as well as by finding alternative water sources, such as natural drains and river tributaries. When the water scarcity became too severe, West Pengasih farmers were forced to change from cultivating rice paddy crops to dry crops.

SECTION III: DOMINANT ALLIANCES IN WATER DISTRIBUTION From May 2004 until July 2005, I observed two dominant alliances in overall water distribution in the seven technical irrigation systems: the one between midstream and upstream FWUAs and the DPIS, and the one between downstream FWUAs and the SDI. The alliance between FWUA Kalibawang with DPIS 3 (Zainuddin, in particular) showed how Zainuddin tolerated illegal water usage by farmers in his area. In return for the “water service” provided, the FWUA rewarded Zainuddin with financial compensation. As mentioned above, Zainuddin refused to channel irrigation water to downstream irrigation systems before farmers’ needs in Kalibawang were completely satisfied, forcing downstream farmers to plant dry crops in their third cropping season, even after the IMT. Farmers in Kalibawang were then able to cultivate rice paddies instead of dry crops because Zainuddin could ensure farmers’ access to irrigation water all year long. The Papah farmers were also helped by the alliance between the same DPIS 3 office and the FWUA Papah. Zainuddin also directed the operation of the Kemukus division structure, this time in favour of farmers in the Papah irrigation system. He often instructed Budiman (in charge of this

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structure’s operation) to partly close two of the gates in the Kemukus division structure, while at the same time leaving completely open the other two gates that channelled water to Papah. During my field visit to the area, the two gates through which water to Pengasih is channelled were only partly open. The actual water level at that moment showed that the discharge into the left canal (going to Papah) was higher than in the right canal (going to Pengasih), as compared to the water distribution plan. More water was actually channelled to the Papah irrigation system, bearing in mind that both canals are approximately the same width. During May 2004, this unequal water distribution16 between the Papah and Pengasih irrigation systems became so obvious that, while water scarcity occurred in the West Pengasih area, water spilled over from the Papah dam. Like the FWUA Kalibawang, FWUA Papah gave Zainuddin financial rewards for ensuring irrigation water supply to the area. In addition, the FWUA Papah was able to skip almost every ten-day water distribution meeting because their water needs were met through their alliance with Zainuddin. Members would attend the meetings to inform the SDI about the starting period of their dry crops (usually between late June and early July) so that SDI would not conduct canal cleaning at that particular time. Another such alliance was formed between the FWUA East Pengasih and DPIS 2 (with Chaerul, in particular). Chaerul was responsible for water distribution arrangements in both the Pengasih (serving East Pengasih and West Pengasih farmers) and the Papah irrigation systems. The alliance was evident by Chaerul’s manipulation of water distribution in favour of the farmers in East Pengasih. During the night, Chaerul would close and lock the left gate in the Beji division structure, so that water from the Pengasih dam would be fully channelled to the East Pengasih secondary canal, at the expense of farmers in the West Pengasih area. Prior to IMT, DPIS 2 operated the Beji division structure through gate regulation. Following IMT in 2001, the SDI redesigned and reconstructed the Beji division structure from a sluice gate to a proportional division structure, to reduce conflicts between farmers from the East Pengasih and the West Pengasih areas. However, the previously installed gates remained attached to the structure,17 even after the reconstruction. The keys to these gates were in the position of DPIS 2. Chaerul’s alliance with the FWUA East Pengasih is also evident from the way he strategically used a technical fault in the reconstructed Beji division structure, which affected how the structure divided irrigation

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water between the secondary canals in East Pengasih and West Pengasih. The water flow that entered the division structure was supposed to be proportionally distributed to both of the secondary canals (the width of the opening to the east canal is proportional to the area irrigating from that canal, and the same for the west). However, the actual functioning of the Beji division structure was hampered by a siphon, located just downstream of the west intake. The discharge capacity of this siphon was less than what should proportionally flow to West Pengasih, which resulted in a backwater curve over the west opening. Because of this curve, farmers in the West Pengasih received less water than was formally designed and agreed upon, while more water was being channelled to the East Pengasih secondary canal. An overview of this division structure is presented in Figure 7.6. However, according to Chaerul, “The Beji division structure is designed and functions as a proportional division structure” (interview, August 2004). When confronted by the SDI on behalf of the FWUA West Pengasih about the fact that more water was channelled to the East Pengasih area, Chaerul insisted that nothing could be done, saying: “East Pengasih might receive more water than was designed. But nothing can be done about that because the Beji division structure was already designed and functioned FIGURE 7.6 Overview of the Water Distribution between West and East Pengasih

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as a proportional division structure” (field notes, 4 May 2004, ten-day water distribution meeting). Chaerul’s knowledge of the technical fault in the Beji’s functioning emerged when he objected to the SDI’s proposal to fix the fault. Both Chaerul and FWUA East Pengasih insisted that the division structure should be left in its present condition. In contrast to these alliances with the DPIS, the FWUAs from the downstream irrigation systems (Pekik Jamal and West Pengasih) formed an alliance with the SDI because DPIS 1 had limited power to influence intersystem water distribution practices, due to its disadvantaged downstream position in the interconnected systems. The alliance between the SDI and the FWUAs in both West and East Pekik Jamal was a result of the SDI repeatedly manoeuvring water channelling to both areas. As mentioned above, in September 2004, when water scarcity occurred in the Pekik Jamal area, the SDI negotiated with officials from the Sermo reservoir to allow additional water to be delivered to the area. When this additional water supply was not sufficient for farmers to irrigate their crops, the SDI arranged yet more additional water by channelling drainage water from Papah directly to the area through a natural drain. The alliance between the SDI and FWUA West Pengasih is clear from the multiple efforts made by the SDI to get irrigation water supply for farmers in the West Pengasih area. It was the SDI that repeatedly raised the issue of water scarcity in the area during the ten-day water distribution meeting on 11 May 2004, even before this was reported by the FWUA. One day prior to the meeting, an SDI staff member visited FWUA West Pengasih to inform them that the water scarcity problem was caused by excessive water use by farmers in the upstream areas (field notes, visit to FWUA West Pengasih office, 10 May 2004). During his visit, the SDI staff member urged the FWUA to raise this issue at the next day’s meeting, so that pressure could be placed on DPIS 3. It should be noted that the SDI had already entered into a conflict with both FWUA East Pengasih and DPIS 2 over the proposed reconstruction of the Beji division structure. Although this conflict was also rooted in bureaucratic competition between the SDI and DPIS, in my opinion, the proposal to fix the technical fault in the Beji’s functioning would not have been broached if the SDI were not allied with the FWUA West Pengasih. In the next section, I discuss how these alliances marked the emergence of a new type of authority in system water distribution, which I refer to as spatial authority.

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SECTION IV: THE ESTABLISHMENT OF SPATIAL AUTHORITY I use the term spatial authority to describe the condition in which an FWUA focuses its role in water distribution to guarantee irrigation water supply to its area. An FWUA’s spatial authority does not necessarily refer to its attempt to promote equal water distribution in its irrigation systems; more importantly, it refers to its attempt to ensure adequate water supply to their specific area. The word spatial refers to a particular area (for example, an irrigation system or a certain area within the system) where their efforts are solely focused. The word authority is used to highlight the FWUAs’ actual decision-making power in shaping the actual water distribution practices within a particular spatial area. Spatial authority was established at midstream, upstream, and downstream irrigation systems following the formation of the different water distribution alliances. First, I discuss the application of spatial authority by the FWUAs East Pengasih, Papah, Kalibawang, and West Pekik Jamal. Second, I discuss the consequences of the applied spatial authority for inter-system water distribution practices.

Spatial Authority in Inter-system Water Distribution The majority of the FWUAs in Kulon Progo applied their spatial authority primarily to bring irrigation water supply to the bengkok lands,18 which are agricultural lands belonging to a village, but which can only be used by members of the village government. In general, bengkok lands are located in the upstream fields of the main tertiary units. The FWUA East Pekik Jamal would first channel irrigation water to the bengkok lands, even if it meant wasting a considerable amount of irrigation water due to the higher elevation of the land in comparison with adjacent fields. The same situation occurred in the West Pengasih and West Pekik Jamal systems, even though irrigation water first channelled to bengkok land could cause canal flooding in other parts of the village. In 2004, the irrigation water supply to both Papah and Kalibawang was focused on sugarcane cultivation raised in bengkok lands in, respectively, Kedung Sari and Kembang village. In a more extreme case of water redistribution, the FWUA East Pengasih applied the water distribution schedule at the secondary level in opposite sequence to that defined in the golongan system, simply to favour the bengkok lands. According to the defined golongan system for

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this area, irrigation water supply should be first channelled to segment 119 during August or September. The FWUA, however, prioritized the water channelling to farmers located in segment 2, at the expense of segment 1 farmers who needed the irrigation water to start their first paddy crop. Farmers in segment 2 used the additional irrigation water to simply increase the groundwater level in their field wells, which these farmers would later use to irrigate their dry crops. Consequently, farmers in segment 1 had to wait to plant their first rice paddy because they could only start to irrigate their fields once the farmers in segment 2 had augmented their field wells. In May 2004, this changed sequence distorted the overall water distribution schedule20 between the East Pengasih and West Pengasih areas. Nevertheless, relying on their alliance with Chaerul and DPIS 2, FWUA East Pengasih was able to downplay the seriousness of the water scarcity problem in West Pengasih, which allowed the gate at the secondary canal in East Pengasih to remain fully open. Except for taking irrigation water supply for bengkok lands, FWUA West Pekik Jamal did use its spatial authority to promote equal water distribution21 between head-end and tail-end farmers in the area.22 During the first year of IMT implementation in 2001, farmers at the tail-end of West Pekik Jamal could not plant a paddy crop in their second cropping season because head-end farmers had used all the irrigation water. However, starting in 2002, tail-end farmers have been able to cultivate paddy crop in their second cropping seasons because of the FWUA’s efforts to invent an alternative water path: irrigation water was directed through a natural drain instead of the existing irrigation canal. In this way, the FWUA made sure that the farmers in Suka Maju would receive water, partly by hiding from the head-end farmers that irrigation water was being diverted through the natural drain. See Figure 7.7 for an overview of this redirected water channelling.

Spatial Authority and Unequal Water Distribution The application of spatial authority (with the exception of the West Pekik Jamal irrigation system) resulted in unequal water distribution at the system level down to farmer’s fields. In the majority of the irrigation systems (Papah, Donomulyo, Penjalin, West Pengasih, East Pengasih, and even Kalibawang, to a certain degree), the water scarcity problem for tail-end farmers was caused by head-end farmers using excessive water. This caused problems like the kind experienced in the West Pengasih area,

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FIGURE 7.7 Overview of FWUA West Pekik Jamal’s Strategy to Channel Water to the Suka Maju Tertiary Unit

Pekik Jamal dam Wojowalur canal

Suka Maju unit

1

Suka Mahmur unit

Peni drain

Division structure 2

2

where tail-end farmers had to rotate irrigation throughout most of the dry season from May to early July 2004. Consequently, unequal water distribution between head- and tail-end farmers resulted in the staggered application of the defined golongan system. Farmers within one golongan system were to start and complete their first, second, and third cropping seasons at the same time. In practice, however, due to the unequal distribution of water, tail-end farmers were forced to start later. According to my interviews with farmers,23 a tail-end farmer’s decision to start later in the cropping season was actually not based on water availability in the irrigation system, but rather on the reliability of the irrigation water supply. For example, in the Kalibawang system, tail-end farmers would only begin planting in early October, which was almost two months later than the defined cropping schedule because they could not start their land preparation until after head-end farmers’ water needs had been satisfied. Similarly, in East Pengasih, tail-end farmers were forced to start planting as late as mid- or late October. In turn, staggered application of the golongan system resulted in the accumulation of a peak water demand, which only intensified the unequal water distribution and delivery. A vicious cycle of distorted water delivery schedule–unequal water distribution–distorted cropping schedule emerged.

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In addition, how the spatial authority was applied disrupted the organizational link of the three DPIS. Prior to IMT, DPIS 1, 2, and 3 frequently communicated with each other to fine-tune the water distribution arrangement, following instructions given by the SDI. After IMT, though, the three DPIS offices functioned in isolation as they focused their systems management on delivering water service to their own FWUA alliance, as in the given above examples of Zainuddin and Chaerul. After IMT, Zainuddin (DPIS 3) operated the Kemukus division structure without any coordination with Chaerul. Similarly, Chaerul (DPIS 2) channelled irrigation water that entered the Pengasih dam to farmers in the East Pengasih area without further coordination with Farid (DPIS 1), who was responsible for the water distribution arrangement in the Pekik Jamal and Sapon irrigation systems. Consequently, Zainuddin’s and Chaerul’s decision to tolerate illegal water taking in upstream systems indirectly decreased DPIS 1’s authority to guarantee irrigation water supply to farmers in the downstream irrigation systems. In Farid’s words: “DPIS 1 field staff’s effort to ensure irrigation water supply for downstream irrigation systems was useless, when both Zainuddin and Chaerul continued with their illegal water taking” (field notes, 11 May 2004, ten-day water distribution meeting). I now turn to the reason behind FWUA’s inability to promote equal water distribution at the secondary level.

SECTION V: RURAL ELITE DOMINATION IN FWUA ORGANIZATIONAL FUNCTIONING The FWUAs’ involvement in irrigation systems management did not result in equal water distribution because the staff in each office functioned primarily as instruments of the rural elite, who were only interested in gaining access to irrigation water for bengkok lands. In this section, I illuminate the FWUAs’ interest in ISF collection. This interest was shaped by two factors. First, higher ISF rates would result in larger stimulant fund allocation as part of Kabupaten Irrigation Improvement Fund under the WATSAL IMT programme. Second, higher ISF rates meant higher salaries for FWUA staff, since, following regional autonomy in 1999, the ISF rate was set and the money collected was used by the FWUAs and WUAs. Generally, the ISF amount collected would be divided among the FWUA staff. In Papah, the FWUA leader took 30 per cent of the total ISF amount, and in Pekik Jamal, the ulu ulu24 took up

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to 25 per cent. In East Pengasih, the FWUA leader attempted to increase FWUA staff salaries by increasing the ISF.25 The FWUAs perceived the WUAs as useful only in relation to their role in ISF collection. As expressed by an FWUA staff member in East Pengasih: “ISF was the basic strength of FWUAs. Without ISF, FWUAs would not function. Hence, a WUA’s role of collecting ISF from farmers was pre-eminent for FWUAs’ organizational existence” (field notes, 21 August 2004, at a Strength, Weakness, Opportunity, and Threat exercise undertaken together with FWUAs/WUAs in Papah, Pengasih, and Kalibawang areas). In East Pengasih, Papah, West Pekik Jamal, and Kalibawang, the regular FWUA–WUA meetings, held every 35 days, were conducted primarily to enforce ISF collection by the WUAs. ISF collection did not result in improved water distribution between the secondary or tertiary levels and farmers’ fields because it was not linked to the FWUAs’ or WUAs’ role as water service providers. With the exception of FWUA West Pekik Jamal, the majority of the FWUAs were generally indifferent to farmers’ water needs. In the Papah and Pengasih irrigation systems, tail-end farmers voiced their concern that paying their ISFs did nothing to improve their irrigation water supply:26 “Farmers were willing to pay ISF. However, if WUA/FWUA staff do not perform their task to ensure irrigation water supply for farmers, farmers should be relieved of ISF payment” (interview with farmers from Papah and Pengasih, March 2004). As little relationship farmers had with the FWUAs, it was non-existent with the WUAs, as the WUAs played no role in water distribution arrangements at the tertiary level, aside from its role in ISF collection. Farmers continued to take water at will; in most cases, head-end farmers took irrigation water whenever they needed it, and only closed the gates only when their needs had been satisfied. If there was enough irrigation water in the secondary or tertiary canals, tail-end farmers would do the same, even if considerable amounts of water would be spilled. As expressed by during an interview session with a head-end farmer in Kalibawang: “When I did not need the irrigation water, I would close the tertiary gate. However, tail-end farmers would reopen the gate. In turn, a lot of water was spilled because, to reach the tail-end fields, a considerable amount of water still needed to be channeled” (interview in Kalibawang, March 2004). If there was not enough water, tail-end farmers would deal with their water scarcity by either waiting for the water or finding

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alternative sources, such as drainage canals or existing river tributaries, or through illegal water taking. In the most extreme cases, farmers were forced to change their cropping pattern from paddy to dry crops. On occasion, farmers who knew the WUA manager for their area would complain about the water scarcity problem, but, in general, the WUAs seldom responded to farmers’ water requests or complaints. In fact, less than ten out of the thirty farmers I interviewed in the Kalibawang, Papah, and Pengasih irrigation systems knew anything about their WUAs, and only three out of eight farmers knew the WUA was to act as their representative. In most cases, farmers knew of their WUA only from its role in ISF collection. An overview of the data27 is presented in Figure 7.8. There are several examples of the FWUAs’ and WUAs’ lack of interest in helping the farmers. In the first, a tail-end farmer’s logical proposal to improve his irrigation water supply in Kalibawang was denied. Facing water scarcity, this farmer proposed building an alternative water channel, running from a head-end farmer’s field drain directly to his field. In this way, he could use the irrigation water that otherwise would only spill into a natural drain. Instead of helping this farmer, the FWUA and WUA refused to act on this practical proposal. In another example, a tail-end farmer in East Pengasih requested that his WUA address head-end farmers’ excessive water taking; the WUA did nothing. In a final example, a proposal FIGURE 7.8 Data Overview with regard to Field Farmers’ Knowledge about WUA/FWUA and IMT WUA 23 %

FWUA

7% 70 %

IMT

3%

3%

97 % Know WUA & function Know WUA but not its function

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Know FWUA but not its function Do not know about FWUA

97 % Know IMT Do not know IMT

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by tail-end farmers to rehabilitate the tertiary canal to reduce leakage was turned down by the WUAs in both Papah and Pengasih. The rural elites’ only other interest, besides water for their lands, was personal financial gain. This is evidenced by the actions of the FWUAs in Kulon Progo district, which were actively involved in agricultural cooperative activities. Cooperative members could borrow and lend money, and, at the end of the year, the financial profits from the cooperatives were shared among its members. Every 35 days, a Kulon Progo FWUA–WUA meeting was held for cooperative members to deliver their monthly contribution to the FWUA. Formally, cooperative membership was open to all farmers; in practice, cooperative members were limited to the FWUA and WUAs staff. In the Kalibawang system, elite domination boosted the actual capital of the cooperatives, reaching Rp30 million (US$3,000), which was thirty times more than its initial capital. In the Donomulyo system, the capital of the cooperatives reached Rp18 million (US$1,800), which was eighteen times more than its initial capital.

SECTION VI: ELITE–FARMER RELATIONSHIPS In this section, first I describe the different types of elite leadership that emerged in the seven technical irrigation systems in the Kulon Progo district, and then I discuss how behaviour among elites might have eventually shaped the elite–farmer relationship towards greater representation of farmers’ needs in water distribution.

Elite Leadership Taxonomy In the Kalibawang irrigation system, elite domination in the FWUA was characterized by strong involvement in financial aspects of FWUA organizational development, focusing on its agricultural cooperative and on management of the stimulant fund. As mentioned earlier, the FWUA Kalibawang was able to increase the financial assets of the cooperative thirty times more than its initial capital. This was partially achieved because cooperative activities included selling agricultural products (such as fertilizers, seeds, and pesticides) to its members. In Papah, the rural elites’ administrative role shaped that FWUA’s development towards being a contracting agency, with particular focus on the actual management of stimulant funds. In Sapon, the FWUA’s raison d’être was directed towards

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being a political group to pressure and urge the reconstruction of Sapon dam; their activities were focused on arranging farmer demonstrations against the respective government institutions. Farmers’ needs were presented as part of the rural elite’s negotiation strategy, and FWUA staff used water scarcity experienced by farmers as their entry point to exercise political pressure on the district parliament and provincial and district governments. This pressure was then used to obtain resources from the development fund for the reconstruction of Sapon dam. There is an overview of the types of leadership in Table 7.3. In East Pengasih and East Pekik Jamal, the FWUA leadership shaped the organization. Being the relative of the district leader, the FWUA leader in East Pengasih was able to direct FWUA development according to his TABLE 7.3 Types of Elite Leadership in the Seven Technical Irrigation Systems in Kulon Progo District FWUA

Type of elite leadership

Farmer–elite relationship

The channelling of farmers’ needs

Kalibawang

Financial focused

Focus on elite interest in increasing their financial benefits from their involvement in FWUA

Only if farmers are cooperative members, managed by the elite.

Papah

Project oriented

Focus on elite interest in gaining financial benefit from the management of development funds

Only if farmers coincidentally benefit from the rehabilitation and maintenance works proposed by the elite.

East Pengasih, East Pekik Jamal

Dictatorial

Focus on FWUA heads’ interest

If farmers have personal connection with FWUA managers.

West Pengasih, West Pekik Jamal

Dynamic

Focus on elite struggle in the FWUA

Elite struggle enlarges farmers’ room for manoeuvre to steer elite decision-making.

Sapon

Political

Focus on elite’s political interest

If farmers’ needs are used as elite political weapon.

Note: As observed from May 2004 to August 2005.

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personal interests and elite connections. Similarly, the FWUA supervisor in East Pekik Jamal used his position as a village elder to fulfill his FWUA’s interests, which included hiring FWUA staff based primarily on their connection with him, regardless if farmers had elected other WUA officials to be their representatives. Farmers could not challenge his decisions, due to his position as a village elder. In West Pengasih and West Pekik Jamal, the elite leaders also shaped the FWUAs. For example, in FWUA West Pekik Jamal, the village priyayi and the agricultural entrepreneurs’ group each focused on quite different tasks. Actual FWUA functioning was the result of the work done by the entrepreneurs’ group: they shaped the FWUA’s role as the water service provider for tail-end farmers, prepared the development proposals for the SDI, oversaw the entire procedure of fund allocation, and prepared the financial reports. In West Pekik Jamal, the leadership was a result of the recent organizational shake-up (to remove a dishonest FWUA leader). The newly elected FWUA leader was determined to have equal water distribution in the area because he wanted to prove to the farmers and his staff that he was trustworthy, unlike his predecessor.

FWUA Unification and Elite–Farmer Relationships As mentioned above, in July 2004, the SDI proposed an organizational restructuring of the FWUAs: unify every FWUA within a single irrigation system into one SWUA. The FWUAs’ individual decision-making and management of the stimulant fund would be transferred immediately to its new SWUA, which would have one secretary and one treasurer to oversee all the irrigation systems in that area. Furthermore, the number of ulu ulu positions would be increased from one to two for each secondary canal. This restructuring was proposed so as to increase the FWUAs and WUAs involvement in water distribution practices. As stated by an SDI staff member: At first, FWUA staff was selected by the village and district government staffs. However, after four years, WUA representatives could view FWUA organizational performance and decide whether these staff were still motivated to continue their tasks in water distribution (field notes, 2 July 2004, joint Papah and Pekik Jamal FWUA–WUA meeting). Another reason that the restructuring was proposed is because the SDI wanted to weaken the alliances between all FWUAs and their respective DPIS offices. The SDI thought that FWUA restructuring would enable new alliances28 to form with SWUAs (interview with SDI staff, 2004).

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FWUA unification was proposed in the Pengasih, Papah, and Pekik Jamal irrigation systems. However, the unification was officially carried out only in the Pekik Jamal system. In Pengasih, the SDI was hesitant to counter the refusal of the FWUA East Pengasih leader due to his close connection with Chaerul, and in Papah, the SWUA was only a paper organization. Initially, the FWUA supervisor in West Pekik Jamal also opposed the idea of unification: “FWUA West Pekik Jamal functions well. Hence, there is no reason to change anything” (field notes, 2 July 2004, joint Papah and Pekik Jamal FWUA–WUA meeting). In Papah, the leaders of FWUA Kongklangan and FWUA Cangkring Mulyo expressed similar resistance. The SDI proposed this unification during an overall joint Papah and Pekik Jamal FWUA–WUA meeting. At this meeting, the WUAs expressed their opinions on the proposed unification, as was done by the FWUA West Pekik Jamal leader just quoted. However, once unification was agreed to by the FWUAs (in Papah and Pekik Jamal irrigation systems) and WUAs, a special taskforce was formed to arrange an election meeting. This taskforce consisted of the soon-to-be former staff of both FWUAs in, respectively, Papah and Pekik Jamal irrigation systems. Its duties were to propose candidates for the positions of secretary, treasurer, ulu ulu, and leader of the SWUA, and to arrange the election meeting, including its time and place, and sending invitations to all FWUA and WUA members not present at the current meeting. At the election meeting, the taskforce presented their proposed candidates, and the SDI distributed blank paper on which each person could write the name of their preferred candidate. The SDI then collected these votes. At the end of the meeting, the newly formed SWUA was legalized by the District Development Planning Agency. I discovered through this unification that the elite–farmer relationship is shaped not only by the elites’ ability or willingness to incorporate farmers’ needs into their own interests but also by the farmers’ ability to manoeuvre the elites’ conduct in representing their needs. In Pekik Jamal, the unification increased farmers’ chances of having their water needs met by the unwilling WUA and FWUA because, when confronted by his elite opponents, the newly elected head of the SWUA, Odang, aligned himself with the farmers.29 Odang proactively asked farmers about their water distribution schedule and promised that he would monitor the gate position at the secondary canal. He also told farmers that whenever they encountered a water scarcity problem, they could contact him directly. Unlike in Pekik Jamal, in Papah the new SWUA existed only on paper. The unification failed to counteract the power accumulation of elites in the

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FWUA Kongklangan and FWUA Cangkring Mulyo. The unification did not result in an increased role and involvement of an SWUA in system water distribution because these two FWUAs continued to focus their own interests on managing the stimulant fund. Elite power accumulation was evident, as the head of the FWUA Kongklangan was able to arrange and guarantee his candidacy with the taskforce members and by securing only his candidates for each position. When the taskforce proposed only one candidate for the position of the SWUA head, the existing FWUA Kongklangan leader was elected.

SECTION VII: WUA BUREAUCRATIZATION The FWUAs had been able to direct the WUAs organizational development to mimic their own bureaucratization.30 Except for the ulu ulus, whose tasks were focused on water distribution activities, the rest of the WUAs focused on administrative tasks, such as preparing meeting notes, invitations to meeting, and ISF registration forms, and reimbursing transportation and consumption costs to WUA staff. The FWUAs also instructed WUAs to conduct routine administrative task, such as the hiring of WUA staff, the yearly renewal of its basic organizational rules, and registration of ISF collection. In more extreme cases, the FWUAs in East Pengasih, West Pekik Jamal, and Sapon insisted that their WUAs document everything in their administrative reports and that WUA training be focused on administrative and financial duties. WUA bureaucratization was clear in how and when WUA meetings were conducted. In general, WUA meetings could only be held if the WUA leader sent a formal invitation letter to all WUA staff. During these meetings, only issues on the agenda, which had been prepared by the WUA leader, could be addressed, with no room for other items to be discussed. Thus, WUA staff’s ability to address specific issues depended on their relationship with the WUA leader. This bureaucratization preserved elite domination in the WUA organizational structure, as farmer representation in the WUAs was overshadowed by the rural elite’s administrative capability and experience. In the Papah, Pengasih, Pekik Jamal, Sapon and Kalibawang irrigation systems, the WUAs consisted mainly of village government personnel and civil servants. Elite domination in WUAs was most apparent in the Sapon, East Pengasih, and Kalibawang irrigation systems. Represented by the

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WUA leader, the rural elite defined how the ISF collection was spent, determined the cropping schedule in the tertiary unit, and decided the exact date farmers had to contribute their required volunteer labour for tertiary canal maintenance. WUA staff who did not belong to the rural elite held no power or control. For example, if staff raised concerns about water scarcity problems at the tail end, the elite would not respond to the matter. Meanwhile, the elite insisted that all farmers had to be involved in maintenance activities, despite the fact that irrigation water never reached farmers at the tail end of the systems. In the WUA East Pengasih, elite domination became so highly concentrated that WUA staff renewal resulted only in the circulation of existing staff in the different positions. Prior to re-election meetings, the WUA leaders nominated only their preferred candidates for each position in their WUA, leaving no choice but for their staff to elect these selected candidates. Unsurprisingly, most of these candidates were from the village government. If WUA staff proposed other candidates, the WUA leader simply ignored the proposal. In the water distribution context, elite domination also transformed the role of the ulu ulu from water service provider for farmers to a protégé of the rural elite. The ulu ulu’s task was changed to concentrate on ensuring irrigation water to the bengkok lands.

SECTION VIII: WUA SUKA MAJU — TASKS AND ACTIVITIES During my field research, I discovered that the majority of the WUAs had no duties except to act as ISF collectors, with some WUAs existing merely as paper organizations. I learned that among the minority of active WUAs — including the WUA Suka Maju in the West Pekik Jamal area — played an eminent role in water distribution arrangements at the tertiary level. Unlike other active WUAs, WUA Suka Maju was run by a single person, Qarun, whose main activity was to ensure irrigation water delivery to the farmers in his tertiary unit in the Suka Maju area. Through his connection, mentioned earlier, with the rural elite in FWUA West Pekik Jamal, Qarun could guarantee irrigation water supply to farmers in his area by using the Peni drainage canal, which runs parallel to the Wojowalur secondary canal. Qarun promoted equal water distribution between head- and tail-end farmers, and was able to direct farmers water taking activities according to an agreed-upon water distribution arrangement. Qarun divided farmers’

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fields into two irrigation blocks following the village administrative boundary. Block 1 consisted of an irrigated area in sub-village 1, while block 2 consisted of an irrigated area in sub-village 2. Based on block 2’s hydraulic position, water was channelled to that block first. Guided by Qarun, farmers in block 2 would channel the irrigation back to the drainage canal (instead of it spilling uselessly into the sea) so that farmers in block 1 could reuse the drainage water. In this way, farmers’ water taking activities in block 2 were linked to farmers’ water needs in block 1. Qarun could allow farmers in block 2 to use the water first, without disadvantaging irrigation water supply to farmers in block 1. If farmers from block 2 channelled the irrigation water directly to the sea, Qarun would then direct farmers in block 1 to take the water first, which would, of course, disturb farmers’ activities in block 2. In addition, Qarun also warned block 2 farmers that the next time they needed irrigation water, he would not bother to arrange it. At the block level, Qarun based his water distribution regulation on field location and the available amount of irrigation water. Thus, if irrigation water was abundant, Qarun would first channel the water to farmers’ fields, which were located on higher land. In this way, the water would reach these fields easily, with the remaining irrigation water channelled to farmers’ fields located on lower land. However, in times of water scarcity, Qarun arranged water distribution in such a way that the available irrigation water would be used to irrigate as many farmers’ fields as possible, with water first channelled to farmers’ fields located on the lower land. In Qarun’s words: “In this way, the scarce amount of water would not be wasted on irrigating those higher fields. Perhaps, water would not be able to reach these fields” (interview with Qarun, 2004). Qarun’s example shows how a WUA’s organizational development could be directed towards the representation of farmers’ needs in water distribution. As Qarun said: The most important thing in WUA organizational development is that a WUA solves problems encountered by farmers in the fields. With regard to its administrative tasks, no farmers are waiting for that. Everything that is stated on a piece of paper was not really important here. It can be written and rewritten by anybody (interview with Qarun, 2004). Qarun did not understand why he needed to arrange regular WUA staff meetings or staff renewal31 if it was obvious that the staff as stated on the WUA organizational chart no longer performed their duties.

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CONCLUSION The implementation of the WATSAL IMT programme in Kulon Progo district did not transfer management authority to the FWUAs and did not establish these FWUAs as the new authority in system water distribution. Like with IMT under the IOMP, the FWUAs remained dependent on the irrigation agency for their water distribution practices because the agency remained in charge of the major irrigation infrastructures. The FWUAs had to use the ten-day water distribution meetings as a platform to request irrigation water from the agency, and even after management transfer, an FWUA’s decision-making authority to direct water distribution was primarily linked to its connection with the irrigation agency. IMT reshaped the overall process of alliance formation between the irrigation agency’s SDI and DPIS offices and the FWUAs. Prior to IMT, alliances occurred primarily through personal connections between the farmers and the irrigation agency staff and were based on the irrigation system’s technical hierarchy, and how the system’s infrastructure regulated water delivery. After IMT, being at the head of the interconnected system, upstream FWUAs allied with their DPIS, who were the system operators. With this allegiance, these FWUAs were assured of sufficient irrigation water supply to their areas, regardless of the defined inter-system water delivery schedule. Meanwhile, downstream FWUAs formed alliances with the SDI, which could arrange water for them when the DPIS prevented sufficient irrigation water supply. The overall process of alliance formation shows the organizational fragmentation of the district irrigation agency (between the SDI and three DPIS, as well as between the upstream DPIS and downstream DPIS). In this context, farmers’ decision-making authority now extended up to system level, under WATSAL IMT, and improved the FWUAs’ bargaining position and alliance formation regarding water distribution. An FWUA’s alliance with SDI or DPIS guaranteed irrigation water supply to their particular area of interest. IMT in Kulon Progo district resulted in fragmented decision-making authority at both the system and the inter-system water distribution levels. The severed command line between the SDI and the DPIS and the establishment of spatial authority at the system level diffused the line of authority in system water distribution. DPIS’ and FWUAs’ access to the ten-day water distribution meeting did not result in coordinated

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efforts to link water distribution practices. This diffused line of authority highlights the complementary role of WUAs, FWUAs, the DPIS, and the SDI in promoting equal water distribution at the inter-system level down to farmers’ fields. In my opinion, this raises the question of how to synchronize the existing patterns of alliances in irrigation systems into inter-system water distribution arrangements. IMT intensified and complicated the overall process of negotiations at both the system and the inter-system water distribution levels. IMT changed the decision-making pattern from centralized management by the irrigation agency to a polycentric one, involving the three DPIS, FWUAs, and SDI. In turn, this change resulted in increased interdependencies between the different actors and organizations involved in system water distribution. When Chaerul, of DPIS 2, hampered the pre-arranged water supply to farmers in the East Pekik Jamal area, it took a coordinated effort from FWUA East Pekik Jamal, SDI, DPIS 2 and 3, and the staff from the Sermo reservoir to fix the issue. When Zainuddin of DPIS 3 decided not to follow the SDI’s suggestion to close farmers’ illegal water taking in the Kalibawang irrigation system, he did so because of his relationship with FWUA Kalibawang. Needless to say, such actions caused operation of the key irrigation infrastructures to become extremely contested. IMT under WATSAL failed to revitalize the farmers’ role in system water distribution, and formation of the SWUAs and FWUAs did not result in greater representation of farmers’ needs in water distribution. Instead, the FWUAs and WUAs acted as power instruments for the rural elite, whose domination in both the FWUAs and the WUAs highlighted the poor organizational link with the farmers they were supposed to serve. Farmers’ needs could only be addressed through contestation in the elite–farmer relationships.

Notes   1. The Progo River starts a few kilometres southwest of Parakan, on the northeastern slopes of the Sumbing volcano, flows through the city of Magelang and along the Borobodur temple complex, before it reaches the Indian Ocean.   2. In fact, the construction of the reservoir was immediately followed by the expansion of irrigated areas in both Donomulyo and Kalibawang, which meant that water from this reservoir could not always compensate for the water scarcity experienced by farmers in the downstream systems.

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  3. In the Kulon Progo district, technical irrigation systems coexist with village irrigation systems, though in general they do not share the same water source for irrigation. Village irrigation systems are managed by farmers and consist mainly of earthen canals and temporary dams. However, since the implementation of the Village Irrigation Development Project in 1997, several permanent dams have been constructed. In 2003, the district government conducted canal rehabilitation in the area through its small repairs programme. Several village irrigation systems are located near the Kalibawang, Penjalin, and Papah irrigation systems.   4. Peter Mollinga, “On the Waterfront: Water Distribution, Technology and Agrarian Change in a South Indian Canal Irrigation System” (Ph.D. dissertation, Wageningen University, 1998).   5. Irrigated areas prone to flooding were included in the first golongan, regardless of the location at the inter-system level. In this way, the earlier planted rice paddies would have reached sufficient height by the time any flooding occurred.   6. Field experience showed that it was easier to direct farmers from whole villages into a particular golongan than to direct farmers from one village into two different golongan. Farmers felt that they were unequally treated and tended to break the defined rules, knowing that their neighbours would start earlier with their first cropping season (interview with SDI staff in Kulon Progo, 2004).   7. Kalibawang, Donomulyo, Penjalin, and Sapon.   8. Papah is midstream; West Pengasih and some parts of East Pengasih and West Pekik Jamal are downstream.   9. Nikolai Sindorf and Diana Suhardiman, “Interactive Irrigation” (MSc thesis, Wageningen University, 1998). 10. John Ambler, Irigasi di Indonesia: Dinamika Kelembagaan Petani [Irrigation in Indonesia: The Dynamics of Farmer Institutions] (Jakarta: LP3ES, 1991). 11. Koentjaraningrat, Villages in Indonesia (Ithaca, NY: Cornell University Press, 1967). 12. This three-year delay proves how IMT implementation was focused on the FWUAs’ role in rehabilitation activities, and how policy-makers in WATSAL had overlooked, or perhaps taken for granted, the FWUAs’ role in water distribution. 13. If this additional water supply was allowed to continue into the following weeks, then the water level in the reservoir might reach its lowest point before the end of the dry season. 14. This additional supply was given so that farmers in the area could plant their first paddy crop at the same time as the farmers in Kalibawang, Donomulyo, Penjalin, and in part of East Pengasih. The SDI was attempting to reduce peak irrigation water demand in the Pekik Jamal system during the months

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15.

16.

17.

18.

19.

20.

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of May and June. According to the golongan system, farmers in East Pekik Jamal would start their first planting in August or September, but they had to wait until farmers from upstream irrigation systems completed their land preparation and seedling activities. When irrigation water for Sapon was channelled directly from Progo River, farmers could only get water from the adjacent river tributaries. During my field research in Kulon Progo, farmers in Sapon planted only one paddy crop because water discharge from these tributaries was erratic. Hence, except for the role of rural elite in shaping in water distribution, I exclude the FWUA in Sapon from my overall description and analysis. During the ten-day water distribution meeting of 4 May 2004, the SDI urged Zainuddin to channel more water to Pengasih. Zainuddin refused and argued that the additional water supply to Papah was also to deliver water to the Pekik Jamal irrigation system. Formally, neither the FWUAs nor district government were entitled to conduct major technical change to the existing irrigation infrastructure, even after formal management transfer. Officially, the SDIs were not authorized to remove the sluice gates because the gates remained part of central government’s assets. The detailed regulation about the amount of bengkok land for each village government member varied among villages. For example, in Gotakan, the village head had the right to use one hectare of bengkok land, whereas in Giripeni, the village head was allowed only 0.8 hectare. Note that both villages are located in East Pengasih. Irrigated lands in East Pengasih are divided between golongan I and II. This means that some farmers in golongan I needed to start their first cropping season earlier than other farmers in the same area. These two time periods are referred to as segment 1 and 2. Water conflict occurred between farmers in the West Pengasih and East Pengasih areas due to the accumulation of peak irrigation water demand in the Pengasih irrigation system during the months of May and June, a period when less irrigation water should be officially channelled to the East Pengasih area. According to the defined golongan system, farmers in segment 1 no longer should need irrigation water, which was untrue because they had to delay planting their first paddy crops in August and September. FWUA West Pekik Jamal’s role as a water service provider for farmers emerged in relation to its attempt to increase the ISF collection rate. According to an SDI evaluation report, FWUA West Pekik Jamal had the highest ISF collection rate in 2003 and 2004 (District Water Resources Services 2003, 2004). Unlike in other areas, nearly every tertiary unit in West Pekik Jamal collected ISF willingly. For example, to ensure irrigation water supply to their fields, farmers in the Suka Maju tertiary unit paid their ISF to the FWUA well before the start

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22.

23. 24. 25. 26. 27.

28. 29.

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of each cropping season. District Water Resources Services of Kulon Progo, “Evaluation on WUAs Activities in Kulon Progo District”, 2003; District Water Resources Services of Kulon Progo, “Evaluation on WUA activities in Kulon Progo District”, 2004. The terms head- and tail-end farmers are used to repeat the head–tail relationship at each hydraulic level in the irrigation systems. Head-end farmers are those farmers with better access to irrigation water; they can be located at the system level, secondary level, or tertiary level. Interviews were conducted with no fewer than ten farmers from each irrigation system. Under WATSAL, the ulu ulu was incorporated into the FWUA organizational structure. In 2004, each farmer had to pay Rp25,000 for each hectare of agricultural land; this was 20 per cent higher than the ISF rate in the previous year. Farmers continued to pay ISFs only to maintain a relationship with the rural elite. The data were gathered from interviews with farmers at work in the fields. Random interviews were conducted with a total of thirty farmers in the Kalibawang, Papah, and Pengasih irrigation systems during March 2004. The interviews focused on these farmers’ presence in the field, as well as their field location (at the head-, mid-, or tail-end) of the secondary canal in the respective systems. The reason for interviewing farmers on-site was to be able to interview real farmers. During my fieldwork, I discovered that farmers who were recommended through WUA or FWUA connections were either village government personnel or retired civil servants, not necessarily practising farmers. For example, the unification of FWUA East Pengasih and West Pengasih would automatically break the alliance between FWUA East Pengasih and Chaerul at DPIS 2. For example, using his close connection with one of the ulu ulu, the former leader of the FWUA West Pekik Jamal, Xadar, used the recent reconstruction of the sluice gate as his opportunity to challenge Odang’s leadership. Following Xadar’s instruction, the ulu ulu did not inform Odang that the key of the gate was still in the SDI office. When irrigation water was blocked to farmers in the ulu ulu’s secondary canal, the farmers consulted with him because the gate was locked. The ulu ulu purposely misdirected them by sending them to Odang’s house to complain about their irrigation water supply. Odang, however, immediately contacted the ulu ulu to ask about the key for the sluice gate. Unable to avoid the confrontation, the ulu ulu told him the location of the key. On the same day, Odang got the key from the SDI and opened the sluice gates. In another example, using Odang’s lack of knowledge about the

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cropping schedule in the East Pekik Jamal area, the former FWUA supervisor instructed one of the ulu ulu to delay the channelling of irrigation water to farmers in Golongan I. When, of course, the water scarcity occurred in the area, he told the farmers it was due to the inability of the new SWUA head. He also instructed the farmers to go to Odang’s house to confront his poor leadership. Odang apologized and explained that he was still learning about the job; he immediately arranged for the water to be directed to these farmers. 30. The term bureaucratization refers to the way the SDI directed FWUA organizational development to mimic the irrigation agency’s bureaucratic organization. 31. According to both FWUA staff and the community organizer, WUA Suka Maju staff should be renewed because its staff composition was unchanged since its formation.

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

8 CONCLUSIONS

INTRODUCTION Throughout this book, my research provides empirical evidence and conceptual arguments to support Irrigation Management Transfer (IMT) policy (re)conceptualization and demonstrates the political dimensions embedded in policy strategies and the “politics” of policy. The research analyses the basic assumptions in IMT policy formulation and why the actual scope of IMT in Indonesia is limited to written policy, not enactment. Under the Irrigation Operation and Maintenance Project (IOMP) Statement in 1987, the irrigation agency reduced IMT to a mere construction programme. The WATSAL IMT (Water Sector Adjustment Loan IMT) programme that followed remained trapped in agency-oriented practices, despite policy-makers’ attempts to use IMT as a tool to eradicate bureaucratic rent-seeking in the irrigation sector. The WATSAL policymakers’ reform initiatives failed because the district-level irrigation agency adapted IMT’s policies to meet its bureaucratic interests, not the farmers’ actual needs. Using Indonesia as a case study, this research shows that government’s partial initiatives in IMT policy formulation and implementation were rooted in a controversy that was never addressed in any policy discourse: WATSAL IMT policies conflicted deeply with the irrigation agency’s

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bureaucratic identity. It perceived IMT as a threat to its power, as IMT proposed the transfer of decision-making authority in sectoral development from the agency to the Water Users Associations (WUAs) and Federations of Water Users Association (FWUAs). The agency also viewed IMT as a potential danger to its organizational foundation, as IMT proposed a shift from infrastructure-oriented to farmer-focused development. Rooted in these fears, the irrigation agency’s antagonistic position towards IMT was directly related to its motivation to defend and protect its bureaucratic territory and interests. I analysed how policy actors within the central ministries directed WATSAL IMT policy formulation and implementation from parliament down to the different administrative levels in the field. Central in levels in the field from August 2003 to July 2005 these processes were the policy actors’ interests, strategies, and access to resources; these factors, of course, shaped the actual outcomes of management transfer. This chapter considers reconceptualizing IMT in relation to the political dimensions of policy strategies and bureaucratic design. The core concepts of bureaucratic identity, policy characteristics, policy channelling, policy debates, farmer–agency dichotomy, and spatial authority are discussed in Section I through Section III. In Section IV, the core paradoxes found in IMT and future research areas to which they lead, are examined. This chapter ends with some final reflections on bureaucratic designs for IMT in Indonesia.

SECTION I: POLICY ACTORS IN THE SECTORAL MINISTRY AND THE RESHAPING OF IMT POLICY ELEMENTS The ever-changing Indonesian IMT policy agendas were the results of the ongoing political contestations between the multiple alliance groups within the central government ministries. The management issues in government irrigation systems were defined differently, if not contradictorily, by the Ministry of Public Works (MPW, the irrigation agency at the time) within the IOMP 1987 and by the WATSAL policy-makers in Kimbangwil (the newly reformed agency) during the 1999 IMT renewal. The policy elite’s interests and perceptions of the irrigation issues defined the shape of the IMT policies. In a similar vein, IMT policy characteristics were constantly reshaped by power struggles between the core policy actors in the irrigation agency and the WATSAL initiative.

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During the 1999 IMT renewal, with the change in irrigation agency administration, the IMT policy evolved from being the agency’s tool to mobilize sectoral fund allocation to the WATSAL policy-makers’ tool to eradicate bureaucratic rent-seeking practices within the irrigation agency. Following the political reform in 1998, the abolition of the MPW, and the overall application of regional autonomy, the WATSAL policy-makers proceeded with their idea of sectoral reform. Unlike before, IMT policy renewal in 1999 represented the Indonesian government’s first genuine attempt to conduct sectoral reform. Nevertheless, the renewal was greatly hampered by the (former MPW) core policy actors in the irrigation agency, who had not changed their opinion towards IMT. Their concerted efforts in 2003 to thwart IMT by using the new Water Act as the legal means to limit the scope of management transfer to the tertiary level led to the stoppage of the WATSAL IMT programme. As noted above, the IMT policy characteristics in the new Water Act were shaped by different networks of bureaucratic and political alliances at the central ministries and within parliament. The promulgation process of the new Water Act linked the political aspects of IMT with the interministerial struggle for access to the sectoral development funds. It was also linked to the political practices regarding Indonesia’s national election. At the inter-ministerial level, the battle over the principles of IMT policy was rooted in the WATSAL policy-makers’ strategy to position both the National Development Planning Agency (NDPA) and the Ministry of Home Affairs (MoHA) as the irrigation agency’s (within Kimpraswil) bureaucratic counterforce. In parliament, the struggle over IMT policy led to the formation of coalitions and counter-coalitions in both Commission IV and its Working Committee. These different groups also played a part in Indonesia’s national election. The battle for control meant that the new Water Act was reduced to a political commodity. Financial interests and resources became the main forces that shaped the negotiations at each stage of the parliamentary process. Access to parliamentary decision making was traded for access to financial resources, and vice versa; this was certainly true for the members of the Working Committee and Commission IV. In my opinion, these members never intended to resolve the existing contradiction in the scope and degree of IMT (as stated in the draft Water Act and as defined under WATSAL). Their position in the promulgation process of the draft Water Act was only related to their interest in increasing their funding to finance their political campaigns. At the parliamentary level,

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the struggle over IMT lost its substance. What mattered was not deciding to continue or to halt the WATSAL IMT programme, but, rather, who was able to supply the financial backing for the parliament members’ political campaigns. This self-interest was repeated over and again as the WATSAL IMT programme was continually shaped by various vested interests at all administrative levels. Discussion on IMT policy characteristics was reduced to how parliament members could use the IMT policy struggle to improve their bargaining position.

SECTION II: POLICY CHANNELLING AND VESTED GOVERNMENT INTERESTS As discussed above, the relationships among the policy actors concentrated primarily on access to sectoral development funds for IMT implementation. The Government of Indonesia’s interest in maintaining its access to the funds affected IMT policy formulation, rules, and procedures at the national level, and linked how it was implemented at the regional and field levels. After the political reform in 1998, the WATSAL IMT programme continued to be implemented through the project approach, which was more beneficial to the bureaucrats than to the farmers. At the national level, the MoHA’s interest in maintaining its access to sectoral development funds was the reason for its pursuing the Kimpraswil– MoHA agreement, which was completed in time for the second Working Committee meeting in November 2003. Prior to the agreement, the MoHA opposed Kimpraswil’s attempt to halt the WATSAL IMT programme. Nevertheless, the MoHA agreed with Kimpraswil’s position on IMT as long as MoHA’s access to the sectoral development funds was maintained. Similarly, the NDPA’s interest in regaining its inter-ministerial decisionmaking authority under WATSAL was evident from its attempt to launch a national seminar on IMT, in which an opposing inter-ministerial coalition might be established. Eventually, however, both the MoHA and the NDPA supported Kimpraswil’s position on IMT, solely for the sake of foreign fund allocation under the “newly” funded World Bank project, the Water Resources and Irrigation Sector Management Project (WISMP). These self-interests were also apparent within the regional governments. With passage of the new Water Act in February 2004, Kimpraswil stopped the WATSAL IMT programme under its IWIRIP project. Provincial and district governments were left to fund WATSAL IMT activities from their

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own resources when sectoral fund disbursement from the central ministries was temporarily frozen. For example, on the heels of the new Water Act, IMT activities in MoHA’s NewISF programme became limited to funding the recruitment of community organizers. At the provincial level, the majority of Provincial Irrigation Agency (PIA) officials also based their position on IMT in relation to how it could ensure them continuous fund disbursement. Hence, the PIA officials agreed with Kimpraswil’s attempt to halt the WATSAL IMT programme, provided that Kimpraswil compensated them with funds for other activities. Not surprisingly, the PIA officials’ decision to then adopt the WATSAL IMT programme in 1999 was based on its access to IMT project funds from the central government. Another reason to support IMT programmes was the power it provided. In Kulon Progo, the decision of the Sub-Division of Irrigation (SDI), the district-level irrigation agency, to continue with the WATSAL IMT programme was rooted in its desire to direct FWUA–WUA organizational development to suit its own interests and to maintain its importance, not to empower the farmers with increased decision-making authority. The SDI specifically designed FWUA organizational development to be an organizational replica of the irrigation agency. The FWUAs’ main organizational activities, like those of the irrigation agency, were focused on infrastructure-oriented development and on developing proposals for system repairs, preparing project financial reports, and conducting rehabilitation activities in the field. The FWUAs’ interest was to acquire as much funding as possible under its management, even though the activities did not benefit the farmers they were supposed to be representing. In addition, the SDI shaped the FWUAs’ role as irrigation service fee (ISF) collectors, resulting in deeper FWUA bureaucratization. The FWUA functioned primarily as an arm of the government bureaucracy, with activities related to formal and administrative rules. In turn, the FWUAs viewed the WUAs and the farmers as their ISF collection points, with FWUA–WUA meetings arranged primarily as a forum to collect ISFs. With the exception of FWUA West Pekik Jamal, no other FWUA in Kulon Progo linked ISF collection with their role as water service providers for farmers. Bureaucracy was abundant in running the FWUAs: busy paperwork included preparing meeting invitations and creating registration and receipt forms for ISF collection. In a move that is pure bureaucracy, FWUA organizational development was shaped by the need

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to regularly “renew” FWUA–WUA staff, even when most of these WUAs existed only on paper. The WATSAL IMT programme extended the line of rent-seeking in irrigation sector development; it did not end it. It simply transferred rent-seeking rules in and around the management of project funds from the irrigation agency to the FWUAs. The majority of Kulon Progo district FWUAs managed the stimulant fund by following the same procedures as the irrigation agency. Consequently, the FWUA-prepared financial reports on stimulant fund management bore little relation to actual fund expenditure. For example, the FWUA West Pengasih kept changing the project financial report to hide the discrepancies between actual fund expenditure and proposed project expenditures. The fact that this FWUA took a portion of the fund as part of staff salaries highlights how stimulant fund management was reduced to an administrative exercise.

SECTION III: THE MEANING OF IMT FOR FARMERS AND THE DISTRICT IRRIGATION AGENCY In the Kulon Progo district, the implementation of the WATSAL IMT programme did not transfer management authority to the System-level Water Users Associations (SWUAs) and FWUAs, which were supposed to be the new authorities in system water distribution. Instead, the three DPIS’s (Division of Provincial Irrigation Services) (which the SWUAs and FWUAs were supposed to make obsolete) remained in charge of the operation of the major irrigation infrastructure projects, while the SDI remained responsible for arranging the inter-system water delivery schedule. Hence, even after management transfer, SWUA and FWUA decision-making authority to direct water distribution practices was linked to its connection with either one of the three DPIS or the SDI. IMT only resulted in increased interdependencies between the different actors and organizations, and intensified and thickened the overall process of negotiations at both the system and inter-system water distribution levels. The formation of FWUAs did not result in greater representation of farmers’ needs, and the WATSAL IMT programme barely affected farmers, despite the policy-makers’ strategy to use FWUAs’ access to the stimulant monies to empower farmers. The district governments and the rural elite directed organizational development of the WUAs and FWUAs, which resulted in the establishment of elite-based government organizations.

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Farmers were rarely informed about the management transfer or that the WUAs and FWUAs were their representatives in systems management. Representation of farmers’ needs was shaped through the farmer–elite relationship at each WUA–FWUA. Farmers’ development needs might be addressed only if those needs coincided with the rural elite’s interests. In the Kalibawang irrigation system, the FWUAs were interested only in promoting its cooperatives by selling supplies and equipment to the farmers. Farmers could reduce their overall farming costs only by buying the seeds, fertilizers, and insecticides or by renting heavy equipment and other materials from the cooperatives, and farmers could make investments in their farms only by borrowing money from the cooperatives. In the Papah irrigation system, the FWUAs’ “representation” of farmers’ needs focused on systems rehabilitation. The FWUAs were successful in receiving development funds for systems rehabilitation, but farmers could only propose that the funds be used to make necessary repairs. At its worst, the dictatorial leadership in FWUA East Pengasih did not meet any farmers’ needs if they did not suit the FWUA leader’s interests. At its best, the dynamic leadership in FWUA West Pekik Jamal allowed farmers to negotiate their water needs in return for their ISF contribution. In the Kulon Progo district, IMT implementation did not break the vicious cycle of bad construction–deferred maintenance–early rehabilitation in irrigation systems management. As under the IOMP Statement, the FWUAs’ access to stimulant fund management in the WATSAL IMT programme preserved the “cyclical relationship of codependency”.1 This time, the codependency relationship was established between the FWUAs and the SDI at the district level, instead of, as under the IOMP Statement between the FWUAs and the irrigation agency at the national level. The main concern of the FWUAs was how to spend the allocated project funds and not how to use the funds as effectively as possible to meet the farmers’ needs. Finally, since the FWUAs perceived this fund as a “gift”, not as a government fund, no one felt responsible for its mismanagement. Ultimately, because of this mismanagement, IMT neither reduced government expenditures on irrigation sector development nor eliminated farmer dependency on government-funding support. Because the FWUAs relied on the disbursement of project funds for their existence, they focused on getting as much project funding as possible from the central ministries and from the regional governments’ revenues. Though ISF collection increased with IMT, it was primarily linked to attempts to

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receive the highest possible amount of stimulant fund: the higher the ISF collection amounts, the more government funds they received. The implementation of the WATSAL IMT programme did not result in equal or effective water distribution in the seven technical irrigation systems in Kulon Progo. The establishment of “spatial authority”, rooted in the alliances between upstream FWUAs and the DPIS’s and between downstream FWUAs and SDI, which resulted in a never-ending cycle of unfair water delivery schedules–unequal water distribution–distorted cropping schedules. In Kulon Progo, excessive water use by the upstream alliances resulted in water scarcity for the downstream alliances. Unable to counteract the upstream FWUA-DPIS alliance, the SDI often had to use the limited water storage in the Sermo reservoir to solve the water scarcity experienced by the downstream farmers. I conclude that IMT should have been focused on synchronizing the existing alliances at each water distribution level with system and intersystem water distribution arrangements. The key to equal water distribution in the seven irrigation systems in Kulon Progo district would have been to have complementary roles among the SWUAs, FWUAs, DPISs, and SDI. The SDI tried to retain overseeing decision-making authority in inter-system level water distribution when such authority moved from centralized management by the irrigation agency to a polycentric one involving the SDI, DPIS, and FWUAs. The SDI worked to reshape its role from a government agency responsible for systems management to being a water service provider for farmers. By initiating the ten-day water distribution meetings, the SDI attempted to extend the farmers’ role from one of merely water users to one of equal counterparts in inter-system level water distribution. Ultimately, however, neither the farmers nor their needs were ever truly taken under consideration.

SECTION IV: THE IMT PARADOXES AND FUTURE RESEARCH The first paradox in IMT policy formulation is that international donors gave the irrigation agency primary responsibility for its own sectoral reform. They understood there was a need to conduct sectoral reform, primarily because of the poor performance of the irrigation agency, but then unwisely, appointed the very agency as the reform agent. Indonesian IMT policy was formulated without considering the irrigation agency’s eminent role and bureaucratic power in sector

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development, which implies that the international donors and IMT policymakers assumed that there would be an apolitical approach towards IMT. Apart from its role and tasks in directing the sector’s development, the irrigation agency was assumed to lack any identity or interests of its own. The relationship between the irrigation agency (as the power holder) and farmers (as the future power holders) in IMT was viewed, incorrectly, as a technical and managerial matter. With reference to this supposedly apolitical approach towards IMT, the irrigation agency’s resistance to proceed with IMT was treated primarily as one of the “escape hatches”2 in IMT policy development. The slow progress of the IMT policy under the IOMP 1987 Statement was blamed on the irrigation agency’s lack of political will, and the halting of the WATSAL IMT programme in 2004 was blamed on its lack of political commitment. For whatever reason, this lack of political will and commitment was never explored during IMT policy discourse. In Indonesia, the World Bank treated the irrigation agency’s decision to adopt an IMT policy as evidence of the agency’s motivation to conduct the proposed sectoral reform, regardless of the agency’s clear interest in project fund allocation. IMT under both the IOMP Statement and WATSAL was resisted by the irrigation agency, which proves that its decision to adopt IMT policy was not actually aligned with the global attempt to promote IMT. The World Bank continued to uncritically promote IMT formulation and implementation in Indonesia, even after the irrigation agency openly opposed the idea of management transfer. After the IMT policy battles in 2004, the World Bank halted the third tranche of WATSAL funds disbursement, yet almost immediately started to finance another IMT programme under the WISMP. Future research needs to focus on how international donors’ promote the adoption of policy trends by developing country governments and how this is linked with donors’ interests and organization characteristics. The international policy agenda in irrigation has been defined by international donors’ interest in maintaining their importance in directing water sector development as financial provider and development agency. The question remains as to how these two roles shape the international donors’ position as trendsetters in irrigation development. The second paradox in IMT policy formulation is that management transfer was first justified as part of the neo-liberal development perspective,3 and then as part of the decentralization and democratization perspective.4 In the first perspective, IMT was promoted to increase farmers’ financial rewards as the direct beneficiaries of irrigation sector development. In the

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second perspective, IMT was encouraged to increase farmers’ decisionmaking authority in irrigation systems management. Ironically, farmers often did not have a choice in whether or not they were interested in IMT at all, despite the fact that IMT was promoted to increase farmer decisionmaking authority in irrigation systems management. In reality, nothing can be said about farmers’ willingness to take over systems management or how they perceived IMT, since farmers continue to be treated as a homogeneous group (on the concept of labelling, see Wood).5 International policy-makers assumed that farmers’ needs would be incorporated in the WATSAL IMT programme, but did not consider that IMT might be perceived differently among the farmers, dependent on their location in the irrigation system, farming practices, social and economic status, and access to decision-making in both the WUAs and FWUAs. In Indonesia, the WATSAL policy-makers, like the international policy-makers, assumed that farmers were willing and prepared to take over irrigation systems management from the irrigation agency. The WATSAL policymakers simply took for granted that farmers would view the FWUAs as the agents of reform in irrigation sector development. Farmers did, in fact, perceive IMT very differently. From my interviews with farmers, upstream farmers were not willing to take on systems management responsibilities (after I explained IMT to them) because they did not see how IMT would improve their water distribution practices. Downstream farmers, on the other hand, were enthusiastic about the idea of management transfer only if IMT could ensure their irrigation water supply. Thus, when a shortage of trained and capable farmers was given as one of the barriers of implementing IMT, no one considered that such shortages occurred because farmers did not see the need to organize themselves in the way proposed by the government. In addition, the FWUAs and the WUAs also had differing, and often conflicting, roles in irrigation systems management. In the Kalibawang system, the FWUAs were more interested in their cooperative activities than in regulating farmers’ water distribution according to the defined inter-system water delivery schedule; whereas in West Pekik Jamal, the FWUA provided sufficient water supply by increasing the ISF collection. Future research on IMT needs to focus on how farmers perceive management transfer in relation to their actual roles and capability in irrigation systems management. If farmers opt to use their decisionmaking authority, it must be rooted in their development needs. The third and final paradox is that the WATSAL policy-makers’ strategy was to use IMT as a tool to eradicate bureaucratic rent-seeking, yet the

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WATSAL IMT programme was implemented through bureaucratic project structure and mechanisms. Other than the project structure, there were no other alternatives to channel policy programmes to the regions. Ironically, that meant that the implementation of the WATSAL IMT programmme through the project approach preserved the very foundation upon which rent-seeking practices were based.

SECTION V: FINAL REFLECTIONS ON BUREAUCRATIC REFORM FOR IMT IN INDONESIA The policy controversy in IMT remains unresolved because the bureaucratic reform in IMT remains unaddressed in the WATSAL IMT programme. With the abolition of the MPW, core policy actors were excluded from the new Ministry of Settlement and Regional Development’s (Kimbangwil) overall process of IMT formulation and implementation under WATSAL. However, this “bureaucratic reform” hardly touched the core policy actors’ belief system6 as they were isolated in the newly formed State Ministry of Public Works (Meneg PU), where they plotted how to recover their control. The reform planned by WATSAL policy-makers, however, was limited to the appointment of a new Kimbangwil minister who had a strong nongovernmental organization (NGO) background. Once the Meneg PU and Kimbangwil were unified within the Ministry of Settlement and Regional Infrastructure (Kimpraswil) in 2001, the former MPW’s core policy actors resumed their bureaucratic power and once again directed irrigation sector development towards infrastructure-oriented development. The irrigation agency continued to play an eminent role in shaping IMT policy formulation and implementation. Despite its bureaucratic fragmentation as a consequence of regional autonomy, the national and regional irrigation agencies were able to maintain their bureaucratic identities and the power to direct the sector’s development. At the national level, the irrigation agency successfully stopped the WATSAL IMT programme, following the promulgation of the new Water Act. Despite the WATSAL policy-makers’ earlier success in hiding the real implications of IMT from the core policy actors, these actors were able to redirect the IMT policy by freezing sectoral fund disbursement for IMT implementation. At the provincial level, it was evident that the majority of officials in the PIA viewed IMT primarily as a tool to mobilize project funds. The Provincial Irrigation Project (PIP) leader and officials in the PIA defined the provincial government’s position on IMT only after the

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IMT policy battles were over. At the district level, the SDI directed the FWUAs’ organizational development so that they became replicas of itself. Therefore, the international donor plan for the FWUAs to eradicate rentseeking practices backfired because the agency shaped how the FWUAs functioned. Logically, one could not expect the FWUAs to manage the stimulant fund transparently as they took direction from the corrupted district irrigation agency. Despite the irrigation agency’s resistance to change, recognition of the need for bureaucratic reform was present at both the national and the regional levels. Mid-level officials at the NDPA formulated the WATSAL IMT programme, proving that some government ministries were motivated to create reform. The fact that officials in Kimpraswil hid the implications of IMT under WATSAL from the former MPW core actors illuminates that even some irrigation agency leaders realized bureaucratic reform was needed; some of these officials continued to insist on reform despite IMT’s eventual moratorium. The Sub-Directorate of Water Resources (SDWR) in the MoHA continued to support the idea of the Consortium of NGOs and Universities to halt the promulgation process of the new Water Act, even after the Kimpraswil–MoHA agreement was formed. The MoHA’s decision to be the second government agent responsible for IMT implementation was linked to the motivation of some of its officials (primarily in the SDWR) to promote sectoral reform. At the regional level, the East Java and Yogyakarta PIA leaders and the Yogyakarta PIP’s former leader debated the changing role of the irrigation agency from decision maker to farmers’ facilitator. The way the PIA officials in East Java manoeuvred the fund disbursement procedure so as to continue with the WATSAL IMT programme shows the dynamic force reformers can have. In Kulon Progo district in particular, the SDI gradually changed its role from decision maker at the inter-system water distribution level to water service provider for farmers; this again highlights that some within the district irrigation agency desired reform. The question remains how these reform forces can be bundled to counteract the dominant, mainstream interests of the irrigation bureaucracy in Indonesia. The WATSAL policy-makers’ strategy to use both the NDPA and MoHA as forces for reform failed because neither agency could counteract Soenarno’s power as the Kimpraswil minister, which was rooted in his political relationship with the president. And the WATSAL policy makers’ strategy to use the FWUAs’ access to sectoral development funds

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to eradicate rent-seeking practices failed because rent-seeking had become embedded in the fabric of the bureaucracy. In my opinion, bureaucratic reform in the irrigation sector needs to start at the point farmers can interact with their bureaucratic counterparts, which is at the irrigation system. I believe that irrigation sector reform should first be linked to farmers’ actual development needs, leaving them to decide whether management transfer would improve their standards of living. In this context, IMT should be promoted as a development option rather than a policy prescription. The reason for choosing the irrigation system level as the starting point to initiate bureaucratic reform is connected to the SDI’s role in reshaping the overall implementation of the WATSAL IMT programme. The SDI formed the FWUAs to be organizational replicas of the irrigation agency, yet promoted polycentric decision-making processes at the inter-system water distribution level. This identifies the transitional nature of the district irrigation agencies as the key point in the irrigation sector to create better relationships between the Indonesian state and its citizens. Unlike their bureaucratic counterparts at the provincial and national levels, the SDI involved farmers in their day-to-day work. Hence, in my opinion, the SDI is the agency most likely to successfully initiate reform. Regardless of how the SDI views IMT policy, it not only has tremendous knowledge of the irrigation system’s technical characteristics, but also of the social and political interplay in overall systems management. The main reason behind the failure of the WATSAL IMT programme was that WATSAL policy-makers were not directly linked to farmers, and therefore were less knowledgeable than the SDI regarding farming and irrigation practices. The SDI is crucial in defining the actual meaning of IMT for farmers. Consequently, the scope and degree of this reform should be flexibly defined in accordance with farmers’ needs and how the irrigation agency views its role in representing these needs. Management transfer should relate to both the farmers’ willingness to take on systems management responsibilities and how the SDI addresses problems in the irrigation systems. In this way, bureaucratic reform would be directly linked to the issues encountered by the SDI and the farmers, For instance, the WATSAL policy-makers strategy to use the Kabupaten Irrigation Improvement Fund (KIIF) to counteract the irrigation agency’s bureaucratic power in the sector failed to empower farmers because it was not rooted in farmers’ actual development needs; rather, it was designed to aid the irrigation

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agency’s bureaucratic identity. Though unintended, IMT policy strategies formulated by the WATSAL policy-makers remained trapped within the agency’s bureaucratic mind-set. One major impediment to initiating bureaucratic reform at the irrigation system level is that any reform remains trapped in an existing power structure, forcing farmers into a relatively weak bargaining position. In a similar arrangement, most FWUA–WUA organizations were dominated by the rural elite, who frequently only represented the farmers’ needs when it matched their own interests. The crucial point for future successes is how to shape the farmer–rural elite relationship so that it facilitates the representation of farmers’ needs all the time. Finally, I think bureaucratic reform needs to include strategies that encourage, not exclude, the irrigation agency’s participation in the process of IMT policy formulation and implementation. For better or for worse, so far the irrigation sector’s development in Indonesia cannot be directed without the irrigation agency’s willingness and experience.

Notes 1. Douglas L. Vermillion et al., “An Assessment of the Small Scale Irrigation Management Turnover Program in Indonesia: Research Report 38” (Colombo: IWMI, 2000). 2. E. Clay and B. Schaffer, eds., Room for Manoeuvre: An Exploration of Public Policy in Agriculture and Rural Development (London: Heinemann, 1984). 3. D. Carney and John Farrington, Natural Resource Management and Institutional Change (London: Routledge, 1998). 4. M.S. Grindle, Getting Good Government: Capacity Building in the Public Sectors of Developing Countries. Harvard Studies in International Development (Boston, MA: Harvard University Press, 1997). 5. G. Wood, ed., Labelling in Development policy, essays in Honour of Bernard Schaffer (London and the Hague: Sage Publications and ISS, 1985). 6. Paul A. Sabatier and H.C. Jenkins-Smith, Policy Change and Learning: An Advocacy Coalition Approach (Colorado: Westview Press, 1993).

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

INDEX (Note: Pages numbers followed by “n” refer to notes.)

A Agricultural Sector Adjustment Loan (ASAL), 94 Andalas University, 139 anti-corruption movement, 63 “authorization letter” system, 27 B Bagus’s role, evolution of, 142 Beji division structure, 221–23 bengkok land, 224–25, 235 irrigation water supply for, 225 Berita Acara Pembayaran, 46n92 BPK audit findings, 25 British Raj bureaucracy, 11 “budgetary funds”, 58 “bureaucratic capitalism,” 48, 73, 73n5 product of, 71 bureaucratic clash and agreement, 136–37 bureaucratic conflicts, re-occurrence of, 151–52 “bureaucratic expenses,” 58 bureaucratic fragmentation, 253 bureaucratic mechanisms, 71 reproduction of, 57 bureaucratic patriarchy, 56 bureaucratic patrimonialism, continuation of, 40n15

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bureaucratic polity, concept of, 40n22 bureaucratic reform, 63–70 for IMT in Indonesia, final reflections on, 253–56 within Kimbangwil, 70 bureaucratic rent-seeking, 25–26, 48, 55–58, 252 bureaucratic services, 59 bureaucratization, 242n29 in Indonesia, 48 WUA, 234–35 C Central Java, 201n3 civil society movements, 63 client–service provider relationship, 97 codependency, cyclical relationship of, 249 “common property resources”, 2 community organizer recruitment, 196–99 consortium counter-alliance, emergence of, 144–51 consortium members, 160–61 construction programme, from cost recovery to, 89–92 “Consultation and Project Coordination”, 26 Coordinating Minister for Economic Affairs, 127, 133

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270 core policy actors, 49, 63–64, 68, 125 re-emergence of, 68–70 corruption, 13 Corruption Perceptions Index, 13 counter-political forces in parliamentary decision making, 149–51 D decentralization, 16, 42n40 decision-making authority, 13, 20, 67, 250, 252 in systems management, 92 transferring, 18 decision-making process, 49, 90 deconcentration, 16 “deferred maintenance culture,” 98 despite regional autonomy, 23 development blueprint, 12 development fund allocation, 27 development fund expenditure, 29 development fund management, 28 Directorate General of Housing, 76n51 Directorate General of Irrigation, 53, 62, 64 in Kimpraswil, 70 Directorate General of Regional Infrastructure Development, 76n51 Directorate General of Road Infrastructure, 76n51 Directorate General of Rural Development, 64, 76n55, 120n77 Directorate General of Spatial Planning and Regional Development, 64 Directorate General of Urban Development, 64 Directorate General of Water Resources, 70

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Bureaucracy and Development Directorate General of Water Resources Development (DGWRD), 15, 109, 117n57 Directorate of Irrigation and Water Resources (DIWR) of NDPA, 151 District Development Planning Agency (DDPA), 184, 233 district irrigation agency, 248–50 District Water Resources Services (DWRS), 30, 180–81 Division of Provincial Irrigation Services (DPIS), 30, 174, 180–81, 202n9, 206, 215–18, 248, 250 alliances with, 223 bureaucratic transformation in, 184 Donomulyo irrigation system, 208 water distribution in, 216 donor-funded policy programme, 90 draft Water Act, 125 controversial revised clauses in, 127–32 Kimpraswil’s revision of, 129–32 plenary meeting on, 157–59 public consultation about, 137–42 revised clauses of, 130 to Working Committee, 139 WUA proposed changes to, 140, 141 E East Java, PIA-PIP Relationships in, 178–79 echelon system, 59, 60, 75n36 elite–farmer relationship, 230–34 FWUA unification an, 232–34 taxonomy, 230–32 types of, 231 F farmer–agency relationship, 80 farmer empowerment, 194–95

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Index farmer-managed irrigation systems (FMIS), 2 farmers’ decision-making authority in systems management, 160 farmers–irrigation agency relationship, 83 farmers, WATSAL IMT programme for, 147 Febri’s strategy, 146 Federation of Water User Associations (FWUAs), 2, 5, 26, 79–82, 185–86, 206, 216–20, 244, 248–50, 254 dominant alliances in water distribution, 220–23 downstream, 219 elite–farmer relationship, 230–34 formation of, 248 Kongklangan, 234 organizational characteristics, 189–90 organizational development, 194–96, 247–48 rural elite domination in, 227–30 staff, 232 SWUAs’ and, 215–20 unification, 232–34 upstream, 219 and WUAs, 227–30, 233 first Commission IV meeting, 148–51 Fiscal Decentralization Act Number 25 of 1999, 16, 17, 24 fiscal dependency, preservation of, 22–24 foreign loans, 11 policy reform by, 97–99 formal decision-making power, 49 formal policy network for promulgation of Water Act in parliament, 128, 129 “frames conflict” in Indonesian

10 Bureaucracy& Dev_IND.indd 271

271 irrigation policy development, 122 functional role corruption, 41n25 fund proposal and allocation, formal procedure in, 34 funds mobilization, policy tool for, 85–89 FWUA–WUA organizations, 256 development, 247 G Gadjah Mada University, 139 general purpose grants (DAUs), 18, 22, 44n57 Golkar political party, 14, 169n33 members from, 146 golongan system, 212, 224, 226, 239n14 in Kulon Progo District, 212–13 government fund disbursement, 19 before and after regional autonomy, 19 government-managed irrigation systems, 81 Government of Indonesia (GOI), 93, 161 and World Bank, agreement between, 107 government policy-makers, 27 Government Regulation Number 77 of 2001, 105, 106, 111, 119n68, 125, 133, 137 on IMT, 102 Government Regulation Number 23 of 1984 on irrigation, 125 government’s organizational structure, 29–33 I Implementation Guidance, 53 IMT. See Irrigation Management Transfer (IMT)

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272 Indonesia bureaucratization in, 48 characteristic of, 9 regional autonomy application of, 22–27 concept of, 9 and fall of new order government, 16–22 as rentier state, 10–12 sectoral development, 10 project approach and, 27–37 state, reformation of, 12–16 Suharto’s New Order government, 9 WATSAL policy-makers in, 252 Indonesian bureaucracy, 48 Indonesian Consumer Foundation, 75n44 Indonesian Forum on Globalization (INFOG), 139 Indonesian government, 63, 84 irrigation systems, 118n67 Indonesian IMT, 78–79 implementation of, 107–10 legal framework under WATSAL, 101, 102 paradigms, researching, 80–83 policy, 78–79, 244 adoption, 112n7 assumptions vs. reasons in shaping, 79–80 evolution of, 83–93 frames in, 122–25 making, 83 under WATSAL, 93–99 organizational structure, 99–101 WUA empowerment, strategic positioning of, 101–7 Indonesian irrigation agency, 62, 78 Indonesian irrigation sector development, 49–50

10 Bureaucracy& Dev_IND.indd 272

Bureaucracy and Development Indonesian political reform of 1998, 47 Indonesia Water Resources and Irrigation Reform Program (IWIRIP), 26, 32, 68, 246 infrastructure-oriented irrigation development, 48, 61, 62, 247 activities, 91 irrigation agency and, 49–54 infrastructure-oriented programme, 58, 62 inter-ministerial decision making, sectoral decision making to, 99–101 international donors, 2 international epistemic community, 2 International Irrigation Management Institute (IIMI), 91, 119n68 international policy-makers, 79, 80, 252 International Water Management Institute (IWMI), 92 inter-sectoral decision-making platform, 67 inter-system level water distribution, 250 irrigation agency bureaucratic identity, 47–49 bureaucratic reform, 63–70 rent-seeking rules in project fund management, 58–61 and resistance to new policy trends in irrigation, 61–63 structural properties of, 49–58 financial reporting, 58 and infrastructure-oriented development, 49–54 organizational structure, regional autonomy and, 20–22 relationship between, 251 irrigation-based rural development,

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Index “holistic approach” modelling of, 120n77 irrigation canals, 210 Irrigation Committee, 103, 106, 184, 202n11 Irrigation Development Turnover (IDTO) programme, 91, 109 Irrigation Improvement Fund, 99 irrigation management funds, 106 Irrigation Management Reform, 115n31 Irrigation Management Transfer (IMT), 1, 2, 12, 68, 92, 102, 214, 243 for farmers, meaning of, 248–50 implementation of, 107–10, 188 and inter-system water distribution, 214–20 legal framework under WATSAL, 101, 102 paradigms, researching, 80–83 paradoxes and future research, 250–53 policy, 78–79 adoption, 112n7 assumptions vs. reasons in shaping, 79–80 characteristics, 244 debates, 178 description and analysis of, 124 elements, reshaping of, 244–46 evolution of, 83–93 formulation and implementation, 243 GOI’s position on, 162 in Indonesia, 72 Kimpraswil and MoHA Relationship in, 136–37 making of, 83 renewal, 3, 122 struggles, 125–27

10 Bureaucracy& Dev_IND.indd 273

273 timeline of, 134 WATSAL, 133, 140 provincial governments’ position on, 176–79 renewal, 245 SDI’s view of, 184 WATSAL, 93–99 organizational structure, 99–101 WUA empowerment, strategic positioning of, 101–7 Irrigation Management Turnover, 115n31 Irrigation Operation and Maintenance Project (IOMP) 1987 Statement, 4, 62, 75n41, 79, 83, 84, 89, 90, 93, 96, 108, 111, 125, 176, 200, 214, 243, 249, 251 IMT adoption under, 89 IMT policy under, 85–89, 110 analysis of, 92–93 irrigation sector development, 12, 57, 61 policy change in, 63 irrigation service fee (ISF), 85, 184 collection, 197, 214, 227–28 collectors, 247 Irrigation Sub-Sector Project (ISSP I), 90 irrigation system–one management, 104 principle, 95 irrigation systems, 223–29 for bengkok lands, 225 Donomulyo, 208 Kalibawang, 206, 216, 228–29 in Kulon Progo district, 186–87, 206–14 majority of, 225 management, 85, 119n69, 249 management finance, 103 Papah, 208–10, 220–21, 233 Pekik Jamal, 208–10, 217–18

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274 Pengasih, 208–10, 217–21, 227–30 Penjalin. See Penjalin irrigation system run-off-the river, 210 Sapon, 206, 210, 219, 227 south-east, 208 south-west, 208 J Java Irrigation Improvement and Water Resources Management Project (JIWMP), 91, 176 Java Irrigation Improvement and Water Resources Management Project–Irrigation Development Turnover (JIWMP–IDTO), 4, 117n49, 119n77, 126 JIWMP–IWIRIP loan, 108, 109, 111 joint ministerial decree, 125 formulation process of, 111, 132 K Kabupaten Irrigation Improvement Fund (KIIF), 99, 103–5, 125, 136, 188–89, 255 chain of undetectable fund (mis) management, 190–94 formulation of, 119n69 FWUAs’ organizational characteristics, 189–90 Kalibawang irrigation system, 206, 216, 228–30, 239n3, 249, 252 Kemukus division structure, 215–17, 220, 227 irrigation water supply from, 206, 208 Kemukus Wudu secondary canal, 217 Kimbangwil, 7n18, 12, 64 formation of, 63 organizational structures of, 15, 64, 66

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Bureaucracy and Development Kimpraswil, 12 conception of IMT, 122 organizational structure, 68–70 policy actors, 4 public consultation, 138–39 revision of draft Water Act, 129–32 Kimpraswil-driven Water Act, promulgation process of, 164 Kimpraswil froze fund disbursement, 178 Kimpraswil Ministerial Decree Number 529 of 2001, 105, 106, 111, 189 Kimpraswil–MoHA agreement, 137, 139, 246, 254 Kimpraswil moratorium, 132–37 Kimpraswil–PDI-P alliance, 152 Kimpraswil–PDI-P coalition, 166n29 emergence of, 142–44 Kimpraswil–PDI-P–P3 coalition, 164 Kimpraswil–World Bank relationship, 161–63 Kongklangan, FWUAs, 234 korupsi, kollusi, nepotisme (KKN), 13 Kulon Progo district, 180–88, 239n3, 250 golongan system in, 212–13 irrigation agency after regional autonomy, organizational structure of, 181, 183 before regional autonomy, organizational structure of, 181, 182 irrigation systems in, 206–14 L large-scale irrigation systems, 160 legal procedure of Water Act promulgation, 127, 128

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Index Letter of Sector Policy (LoSP), 93, 97, 125 policy criticisms in, 99 M medium-scale irrigation systems, development budget for, 143 Meneg PU, 15, 63, 64, 71, 76n47, 253 core policy actors, 68 Ministry of Agriculture (MoA), 15, 55, 58, 91 Ministry of Finance (MoF), 22, 30–31, 33, 46n88 and sectoral ministries, relationship between, 30 Ministry of Home Affairs (MoHA), 15, 22, 35, 78, 245, 246 Directorate General of Rural Development (DGRD), 137 forum, 139–42 NewISF programme, 108–10 Ministry of Public Works (MPW), 4, 15, 30, 47, 67, 70, 118n59, 126, 181, 244 abolition of, 63–68 Directorate General of Irrigation, organizational chart of, 52 distribution of project benefits at, 60 organizational structures of, 64, 65 Ministry of Settlement and Regional Development, 4, 12, 47, 63, 78, 253 organizational structures of, 64, 66 Ministry of Settlement and Regional Infrastructure, 12, 63, 68, 253 organizational structure of, 68, 69 MoHA Ministerial Decree Number 50 of 2001, 107 MPW’s Directorate General of Irrigation, 51

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275 N Nahdlatul Ulama (NU), 139 National Development Planning Agency (NDPA), 13, 56, 74n26, 78, 84, 94, 112n2, 117n57, 174, 245 National Irrigation Administration, 2 National Strategy to Increase the Level of Wealth in Farming Households, 151 neo-liberal development perspective, 251 New ISF programme, 108, 109 of MoHA, 118n61 New Order government, 4, 10, 11, 14, 29, 37, 42n44, 43n50 New Order mechanisms, 11 non-budgetary funds, 58, 59, 71, 75n39 non-budgetary status, 176 non-governmental organization (NGO), 25, 67, 100, 253 representatives, 49, 166n8 non-technical irrigation systems, 50 O 101 WATSAL IMT activities, 107 On-Farm Water Management Project (PTGA), 62 officials in, 177–78 unit, 201n4 operation and maintenance (O&M), 48, 61, 83 budget, 98 programmes, 62 organizational structure of Kimpraswil, 68–70 P PAN political party, 144 PAN/Reformasi faction, 153–54

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276 PAN/Reformasi faction–PKB coalition, 164 Papah irrigation system, 208–10, 239n3, 249 water distribution in, 216, 220–21, 233 parliamentary decision making, counter-political forces in, 149–51 parliamentary policy network at first Commission IV meeting, 148 at plenary meeting, 159 at second Commission IV meeting, 156 at working committee level, 145 parliamentary procedure, 146 Participatory Irrigation Management, 115n31 Pekik Jamal irrigation system, 208–10, 217–18, 239n14 FWUAs, 224–25, 232, 233 Pengasih irrigation system, 208–10, 217–21, 227–30, 240n20 FWUAs, 225, 232, 233 Penjalin irrigation system, 208–10, 239n3 water distribution in, 216 People General Assembly, 16, 94, 118n60 PIA–PIP Relationships in Yogyakarta and East Java, 178–79 plenary meeting on draft Water Act, 157–59 policy actors perceptions of IMT, 122, 123 in sectoral ministry, 244–46 policy-makers, 2 policy reformulation, IMT, 104 policy renewal, IMT, 105 political parties, proposed changes to, 154, 155 political party partisanship system, 13–15, 38, 40n23, 55

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Bureaucracy and Development polycentric decision-making processes, 255 post-New Order era, 11 post-Suharto Indonesia, 13, 61 Presidential Instruction Number 3 of 1999, 93, 95 private sector in water management, 170n47 priyayi, 214, 232 Progo River, 206, 212, 238n1 Program Guidance, 53 project activities, 12 project development approach, 29– 37 adoption of, 38 origin of, 28–29 reflection of, 196–99 project fund management, 33, 35, 36, 61, 178 rent-seeking rules in, 58–61 project management units, 29 incorporation of, 21, 53 integration of, 24 project staff. See structural staff PROSIDA, 50, 58, 70 project, implementation of, 53 Provincial Development Planning Agency, 179 provincial governments’ position on IMT, 176–79 provincial government structure, overview of, 174, 175 Provincial Irrigation Agency (PIA), 20, 60, 176, 247 authority, 178 in East Java, 179 interviewees, 177 Provincial Irrigation Project (PIP) leader, 253 provincial level project management unit, 32

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Index Provincial Water Resources Services (PWRS), 20, 175, 176 structure of, 21 R Reformasi faction’s strategy, 153–56 regional autonomy, 16–22 application of, 22–27, 38 and fall of new order government, 16–22 prospect of, 26–27 Regional Autonomy Act Number 22 of 1999, 16, 18, 24, 93, 94, 118n60, 166n16 regional development plan, 18 regional governments, 42n42 rent-seeking rules, 71 in project fund management, 58–61 re-occurrence of bureaucratic conflicts, 151–52 Repelita I–IV, 50, 51 Ringskog, Klas, 50 river tributaries, 210 routine funds, 33 run-off-the river irrigation systems, 210 rural elite defined, 235 FWUAs’, 227–30 WUAs’, 214, 227–30 “rural entrepreneurs,” 214 Ryam Rashid, 136 S Sapon irrigation system, 206, 210, 219, 227, 231, 240n15 second Commission IV meeting, 153–56, 160–61 sectoral decision making to interministerial decision making, 99–101

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277 sectoral development funds, 64, 91, 106, 108, 164 sectoral ministries, relationship between MoF and, 30 semi-technical irrigation systems, 50 Sermo reservoir, 212 water supply from, 217–18 small-scale irrigation systems, 91, 92 management of, 143 Soekarnoputri, Megawati, 15, 68, 137, 151 southeast irrigation systems, 208 southwest irrigation systems, 208 spatial authority application of, 225 establishment of, 224–27, 250 in inter-system water distribution, 224–25 and unequal water distribution, 225–27 State Audit Agency (BPKP), 14 State Ministry of Public Works. See Meneg PU Steering Committee, 100, 101 step-by-step project procedures, 28 Stimulant fund management, 189 Stockholm International Water Institute, 82 “strategic group”, 73n8 structural staff, 29 Sub-Directorate of Programme Guidance, organizational chart of, 54 Sub-Directorate of Rural Irrigation, 64 Sub-Directorate of Water Resources (SDWR), 124, 138, 254 Sub-Directorate Program Guidance, 53 Sub-Division of Irrigation (SDI), 181, 192, 247 irrigation management to, 185

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278 water distribution schedule, 215–19, 232–34 Suharto’s New Order government, 9 Supreme Audit Agency (BPK), 14 sustainable irrigation management, 108 systematic framework, 188 for IMT implementation, 196 systematic rent-seeking practices, 33–37, 58 System-level Water Users Associations (SWUAs), 5, 248 federations, 99 and FWUAs, 215–20, 232–34 system management, funds for, 106 T target-oriented IMT implementation, 194–96 taxation effect, 39n11 Technical Guidance, 53 technical irrigation systems, 50 ten-day water distribution meetings, DPIS, 216–20, 240n16 third policy element, explanation of, 97 Transparency International, 13 U Ufford, Philip Quarles van, 72 Upeti system, 55–58 Urban Development, 76n55 W Wahid, Abdurrahman, 12, 15, 68, 95, 166n9 anti-corruption movement in, 63 Water Act, 3, 4, 125, 245–47, 253 Water Act promulgation procedure, 127–29, 142 water channelling path, 218, 219

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Bureaucracy and Development water control, concept of, 211 water distribution, 210 dominant alliances in, 220–23 farmers’ decision-making authority for, IMT, 215–16 schedule at inter-system level, 211 in seven technical irrigation systems, 220 Water Resources and Irrigation Sector Management Project (WISMP), 12, 176, 246 water resources management, 1, 89 private sector in, 170n47 Water Sector Adjustment Loan (WATSAL), 4, 12, 57, 78, 83, 84, 214 agreement, 98 formulation, 94 funds disbursement, 251 organizational structure, 99–101 policy-makers, 103–7, 110, 111, 196, 200 in Indonesia, 252 strategy, 245, 252, 254, 255 tool, 245 policy products, 101 Water Sector Adjustment Loan IMT (WATSAL IMT) programme, 67, 68, 93, 95–97, 101, 102, 104, 111, 118n61, 119n74, 135, 139, 141, 142, 243, 246–49, 251, 253, 254 budget, 126 for farmers, 147 implementation of, 107–9, 174, 177, 244, 250 key policy-makers in, 67 Kimpraswil’s withdrawal from, 162 Kulon Progo district, 180, 184–88 legal framework, 100 policy formulation, 244 policy makers, 124

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Index policy path in, 161 project funds, 178 to WISMP, 176 water sector corruption, 82 water supply, 210 irrigation, 223–29 Water User Associations (WUAs), 2, 5, 79–82, 92, 93, 96, 103, 105, 116n33, 131, 186, 187, 244 bureaucratization, 234–35 elite domination in, 234 empowerment, 79, 102, 104 FWUAs and, 227–30, 233 government financial support to, 106 leaders, 235 organizational development, 90, 107, 236 proposed changes to draft Water Act, 141 representatives, 148, 170n45 rural elite, 214, 227–30 Suka Maju, 235 WATSAL IMT programme. See Water Sector Adjustment Loan IMT (WATSAL IMT) programme

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279 WATSAL Task Force (WTF), 100 interministerial committee, 127 way sectoral development funds, 14 Weberian bureaucracy, 48, 59 Witoelar, Erna, 63, 67, 118n59 Working Committee, 128, 139, 246 level, parliamentary policy network at, 145 Working Committee in Commission IV, 136, 143 members, 165 World Bank, 2, 35–37, 44n53, 50, 75n43, 84, 90, 91, 93, 94, 110, 119n77, 161–62, 251 agreement between GOI and, 107 missions, 36 project, 246 WATSAL team, 119n68 World Bank–funded projects, 12, 71 World Water Council, 82 Y Yogyakarta, 24 PIA in, 26 PIA-PIP Relationships in, 178–79

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Reproduced from Bureaucracy and Development: Reflections from the Indonesian Water Sector, by Diana Suhardiman (Singapore: Institute of Southeast Asian Studies, 2015). This version was obtained electronically direct from the publisher on condition that copyright is not infringed. No part of this publication may be reproduced without the prior permission of the Institute of Southeast Asian Studies. Individual articles are available at .

ABOUT THE AUTHOR Diana Suhardiman is an irrigation engineer and social/policy scientist with experience in natural resources management and water governance. She is currently a Senior Researcher at the International Water Management Institute (IWMI), Southeast Asia Regional Office, based in Vientiane, Lao PDR. Her research focuses on multilevel policy and institutional analysis at the intersection of land, water, environment and energy in the Mekong region. Diana leads research on environmental policy in Vietnam, focusing on forest conservation within the wider policy context of land use allocation, watersheds protection, and poverty reduction. She also conducts research on groundwater dynamics in Laos, using farming systems as her analytical approach. Her most recent research looks at private sector characterization in Laos and Cambodia. Prior to joining IWMI, Diana received her PhD from Wageningen University, the Netherlands, where her research focused on the role of government bureaucracies in shaping water policy formulation and implementation in Indonesia. Her recent published articles and chapters include the following: Journal articles Suhardiman, D., M. Giordano, E. Rap and K. Wegerich. “Bureaucratic reform in irrigation: A review of four case studies”. Water Alternatives 7, no. 3 (2014) (online first) Suhardiman, D. and M. Giordano. “Legal plurality: An analysis of power interplay in Mekong hydropower”. Annals of the Association of American Geographers 104, no. 5 (2014): 973–88. Suhardiman, D. and M. Giordano. “Is there an alternative for irrigation reform?”. World Development 57 (2013): 91–100 Suhardiman, D. “The power to resist Irrigation Management Transfer in Indonesia”. Water Alternatives 6, no. 1 (2013): 25–41.

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Suhardiman, D., D. Wichelns, G. Lestrelin and C. T. Hoanh. “Payment for ecosystem services in Vietnam: Market-based incentives or state’s control of resources?”. Ecosystem Services 5 (2013): 94–101. Suhardiman, D. and P. P. Mollinga. “Correlations, causes and the logic of obscuration: Donor shaping of dominant narratives in Indonesia’s irrigation development”. Journal of Development Studies 48, no. 7 (2012): 923–38. Suhardiman, D., M. Giordano and F. Molle. “Scalar disconnect: The logic of transboundary water governance in the Mekong”. Society and Natural Resources 25, no. 6 (2012): 572–86. Suhardiman, D. and M. Giordano. “Process-focused analysis in transboundary water governance research”. International Environmental Agreements: Politics, Law and Economics 12, no. 3 (2012): 299–308. Suhardiman, D., M. Giordano and F. Molle. “Between interests and worldviews: The narrow path of the Mekong River Commission”. Environmental Planning C: Government and Policy (forthcoming). Venot, J. P. and D. Suhardiman. “Governing the ungovernable: Practices and circumstances of governance in the irrigation sector”. International Journal of Water Governance 2 (2014) (online first). Hoanh, C.T., D. Suhardiman and L. A. Tuan. “Irrigation development in the Vietnamese Mekong River Delta: Towards polycentric water governance?”. International Journal of Water Governance 2 (2014) (online first) Book chapters Prosinger, J., D. Suhardiman, M. Giordano. “Linking climate change discourse with climate change policy in the Mekong”. In Climate change and agricultural water management in developing countries, edited by C.T. Hoanh, V. Smakhtin and R. Johnston. CABI Climate Change Series, forthcoming. Suhardiman, D. and M. Giordano. “Legal plurality in Mekong hydropower: Its emergence and policy implications”. In Water in the anthropocene: Challenges for science and governance. Indicators, thresholds and uncertainties of the global water system, edited by J. Bogardi, A. Bhaduri, J. Leentvaar and S. Marx, pp. 355–67. Switzerland: Springer, 2014.

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