Participatory Planning and Budgeting in Decentralised Indonesia: Understanding Participation, Responsiveness and Accountability
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Participatory Planning and Budgeting in Decentralised Indonesia: Understanding Participation, Responsiveness and Accountability Anwar Musadat A thesis submitted for the degree of Doctor of Philosophy of The Australian National University School of Politics and International Relations College of Arts and Social Sciences The Australian National University September 2019 © Copyright by Anwar Musadat 2019 All Rights Reserved Declaration I declare that the research presented in this Thesis represents original work that I carried out during my candidature at the Australian National University. This thesis does not contain any material that has been accepted for any other degree or diploma at any tertiary institution. To the best of my knowledge, this thesis does not contain any material previously published or written by another person, except where due reference is made in the text of the thesis. Anwar Musadat September 15, 2019 i To Lia, Moreno, Romero & My Parents Acknowledgements This thesis could not have been finished without the support of many people. I would liketo express my gratitude to my chair of panel Assoc. Prof. Katherine Daniell who provided me with continuous encouragement and constructive advice during my PhD journey. I am very fortunate to be under her supervision. I would also like to express my deepest appreciation to my PhD co-supervisors, Assoc. Prof. Blane Lewis and Assoc. Prof. Patrick Guinness, who have assisted me in developing my thesis arguments and have provided many invaluable suggestions. During my academic life at the ANU School of Politics and International Relations (SPIR) and the ANU Centre for European Studies (ANUCES), I benefited from interacting with academics, administrators and fellow students. Among them, I would like to thank Prof. Jacqueline Lo, Dr Annmarie Elijah, as well as all the staff and colleagues at ANUCES. My study at ANU was made possible by an Indonesian Endowment Fund for Education (LPDP) Scholarship. I would like to thank the Local Government of Enrekang District and the Ministry of Home Affairs of the Republic of Indonesia for giving me leave during my graduate study. Iwould also like to thank my friends in Indonesia who assisted me during my fieldwork. I also thank my interviewees who provided me with their time and knowledge. I would like to extend my deepest gratitude to my beloved parents who have given me support during my PhD studies. Finally, I am deeply indebted to my beloved wife Auliasari (Lia), and my sons Moreno Musadat and Romero Musadat for their patience and encouragement to finish my thesis. I dedicate this thesis to them. iii Abstract Decentralisation has been implemented in Indonesia for almost two decades. However, recent studies suggest that service delivery has remained stagnant and unsatisfactory. Studies on the effects of democratic decentralisation, particularly elections, on service delivery have shown mixed results. Literature suggests that elections alone often fail to improve government responsiveness and accountability. Participatory institutions are needed to channel citizens’ demands to local governments and to monitor government activities in between periodic elections. Citizen partici- pation is mandatory in setting development priorities for local government budgets in Indonesia. This participatory process is called Musyawarah Perencanaan Pembangunan (Musrenbang) or development planning consultation. Musrenbang is a set of participatory processes implemented from the village to the district level. Local governments in Indonesia can decide on the institutional design of participatory planning processes based on their own contexts. In general, there are three main types of participatory planning in Indonesia. The first type only involves citizens in setting development priorities. The second type integrates participatory planning with the budgeting processes through the implementation of Subdistrict Indicative Funding Ceiling (PIK), the project allocation of which is decided through participatory mechanisms at the village and subdistrict level. The third type not only implements PIK but also establishes Musrenbang Delegates Forum (FDM) whose members are selected from ordinary citizens to be involved in formulating government work plans and budgets, as well as in monitoring budget implementations. This thesis examines these institutional designs. It focuses on the following questions: How do different institutional designs of participatory planning and budgeting affect local government decisions on budgets? How do institutional designs affect citizen participation? How do account- ability mechanisms work in each design? Does the devolution of funding to the subdistrict level through participatory budgeting improve service delivery? This thesis employs both qualitative and quantitative methods: a comparative case study based on the fieldwork in four districts; and synthetic control methods to assess the effectsof iv v participatory budgeting on local government’s service delivery performance. This thesis argues that districts that integrate participatory planning with the budgeting processes have improved their responsiveness. In contrast, Musrenbang that were not integrated with the budgeting processes often served merely as a consultative arena. However, the characteristics of the participants in the four districts remained stagnant, and Musrenbang merely consolidated existing networks of authority and privilege. The synthetic control methods found that there is some evidence that participatory budgeting in Sumedang—one of the districts studied—improved the net junior high school enrolment rate for the overall population. There is also some tentative evidence of improvement on household access to safe sanitation and the percentage of births assisted by skilled health staff for the third quintile of per capita expenditure; as well as on the net junior high school enrolment rate for the fifth quintile compared to the counterfactual. This thesis, firstly, fills a gap in the study of decentralisation in Indonesia by analysing participa- tory institutions that have previously been overlooked. Secondly, it develops a resource distribution typology based on how the interactions between participatory, technocratic, and political processes shape resource distributions. Thirdly, it fills a gap in social accountability literature by examining long-term social accountability mechanisms under participatory planning and budgeting. Fourthly, it contributes to the few studies that investigate the effects of participatory budgeting on service delivery. Contents Declaration i Acknowledgements iii Abstract iv Contents vi List of Tables xi List of Figures xii Glossary xiv 1 Introduction 1 1.1 Background and research problem . 1 1.2 Research objectives, research questions and the scope of thesis . 5 1.2.1 Research objectives and research questions . 5 1.2.2 Scope of the thesis . 5 1.3 Theoretical framework . 6 1.3.1 Decentralisation . 6 1.3.2 Institutions . 7 1.3.3 Participatory decision-making . 8 1.4 Thesis overview . 10 2 Institutional Designs for Citizen Participation and Their Effects 12 2.1 The designs of participatory institutions . 12 2.2 Enabling conditions for successful participatory institutions . 17 2.3 Participatory institutions, government responsiveness, accountability and citizen participation . 18 2.3.1 Participation . 18 2.3.2 Responsiveness . 20 2.3.3 Accountability . 23 2.4 The Indonesian context of decentralisation and participatory planning and bud- geting . 26 2.4.1 Decentralisation . 26 2.4.2 Overview of participatory planning and budgeting in Indonesia . 29 vi Contents vii 2.4.3 Institutional designs of participatory planning and budgeting in Indonesia 32 2.4.4 The interplay between planning approaches in the Indonesian system . 34 2.4.5 Key findings on participatory planning and budgeting in Indonesia . 36 3 Research Design and Methodology 39 3.1 Introduction . 39 3.2 Research hypotheses . 39 3.3 “Most similar system design” . 42 3.4 Case selection . 43 3.5 Methods for data collection . 47 3.5.1 Semi-structured interviews . 47 3.5.2 Mini-focus groups . 48 3.5.3 Direct observation . 49 3.5.4 Secondary data . 50 3.6 Data analysis . 50 3.6.1 Within-case analysis . 51 3.6.2 Comparative analysis . 52 4 Participatory Planning and Budgeting in West Java 53 4.1 Introduction . 53 4.2 Sumedang: the pioneer of participatory budgeting in Indonesia . 57 4.2.1 Planning and budgeting processes . 61 4.2.2 Participation . 65 4.2.3 Responsiveness and transparency . 67 4.3 Kuningan: demand-making and increased uncertainty . 71 4.3.1 Planning and budgeting processes . 72 4.3.2 Participation . 74 4.3.3 Responsiveness and transparency . 75 4.4 Case comparison and discussion . 77 4.4.1 Participation . 77 4.4.2 Sharing the local budgets . 79 4.4.3 The role of PIK after the enactment of village law . 81 4.5 Concluding remarks . 83 5 Participatory Planning and Budgeting in South Sulawesi 85 5.1 Introduction . 85 5.2 Parepare: moving from ceremonial meetings towards pro-poor policy . 88 5.2.1 Planning and budgeting processes . 91 5.2.2 Participation . 94 5.2.3 Responsiveness and transparency . 95 5.3 Palopo: CDD reform stalled . 98 Contents viii 5.3.1 Planning and budgeting processes . 100 5.3.2 Participation . 103 5.3.3 Responsiveness and transparency . 104 5.4 Case comparison and discussion . 107 5.4.1 Participation . 107 5.4.2 Sharing the local budgets . 108 5.4.3 The role of PIK in Kota and Kelurahan .................. 110 5.5 Concluding remarks . 112