INDONESIA’S DECENTRALIZATION POLICY AFTER SEVENTEEN YEARS : TWO CONTENDING APPROACHES

Abstract

Decentralization policy introduced in Indonesia in late 1990s served two purposes. First, decentralization policy served as an instrument to ensure the unity and integrity of the Indonesian state. Secondly, by devolving power to the region, regional government could deliver better public services for the benefits of its own community maximizing the potentialities of  its own resources. Seventeen years after the implementation, to large extent, decentralization policy has been able to achieve its first purposes by providing local elite political avenue to engage in the political competition at the local level. However, decentralization policy has not yet been successful to achieve its second goal. Local government still heavily depend on central government‟s special allocation fund to manage its responsibility in managing public service delivery to the community.
Keywords: Decentralization, Special Allocation Fund, Public Service Delivery