Indonesia’s provincial mining departments warn that the new national mining law may find difficulties in implementation because of the lack of discipline and management skills at the local government level and the failure of the central government to monitor and supervise the municipalities or empower to the provinces to do so on its behalf.
“For instance it took almost 10 years for the Ministry of Energy and Mineral Resources to update the mining law. This too has contributed to dysfunctional relationships between the three levels of government resulting in disrupted development and confused investors, Ir Peni Susanti said.
“However, we are rapidly learning from the experience,” she added. “New legislation is designed to elucidate the roles of the government levels and there is an increasing trend to position the governors and provincial levels as the regional strategic planners with responsibility to monitor and supervise the local level. It may also occur that the central government will further authorise the governors to act on behalf of its authority.”
Ir Susanti described the scenario “as an evolving process of understanding the correct implementation of regional autonomy - some administrative and some political. But as the president, the governors, the mayors and regents and the legislators are directly elected, we share the same masters, the people of Indonesia. Ultimately, we must reach past the transition stage to rapidly improve the peoples' welfare.
She also described the parallel introduction of regional autonomy and democratisation at all levels as strengthening “the focus on green mining, or what you may call sustainable mining. By this I mean a holistic approach to the social acceptance of mining through the dimensions of community, environment, economic, safety and resource efficiency.
Ir Susanti, who is also Chairman of the Jakarta Environment Board, noted that the new mining law and environment laws include penalties for abuse of the system which “are tough, including imprisonment. That means for the system to work, processes must be clean, transparent, fair and efficient” and called on the central government to improve its information systems and enforcement.
“It is true that much still needs to be done to resolving differences between central government, provincial government and local government regulations and permitting,” she said. “However, you will be able to easily recognise those provinces with the capacity to do so. They are the ones where the governor and her ministers create regional priorities and draw the local governments to a shared vision and good governance. They are committed to human resources development and expanding the skills base. They offer clear and achievable targets to satisfy local needs and recognise community aspirations.
“With 33 provinces and more than 350 local governments, progress will be uneven, but as investors, you will be increasingly aware of the regions that offer good support for your business in exchange for your commitment to good practices,” she concluded.
Ir Susanti was followed by a presentation on mining opportunities in the province of South East Sulawesi and a panel discussion with other provincial mining director-generals.