Moch. Jasin CORRUPTION ERADICATION COMMISSION (KPK) ‏ COMMISSIONER

1. Selling Good Governance and Integrity to Decentralized Governments and Entrenched Bureaucracies ASEAN Integrity Dialogue 2008 Moch. Jasin CORRUPTION ERADICATION COMMISSION (KPK)‏ COMMISSIONER Kuala Lumpur, April 2008

2. PERC – Annual Graft Ranking, Indonesia's Score in 2007: 8,03. • 2004, 2005, and 2006: most corrupt in Asia. In 2007 No. 2 most corrupt in Asia. Country Risk ? • Indonesia's CPI score of 2.3 in 2007, in the context of the ASEAN, is only slightly better than Myanmar's and Cambodia's. • Corruption Perception according to business actors – a reflection of the level of public services Quality of Public Services ? PERC Ltd. Competitive Ability ? • Global Barometer of Corruption Corruption is evident in all sectors • The World Competitiveness Index 2006: Indonesia ranks 60; Malaysia 23, Thai 32; Philipina 49; Singapura 3. Korupsi di Indonesia • Growth Competitiveness Index Indonesia ranks No. 50 with a score of 4,26. Institute of Management Development (IMD) Geneva • Ease of Doing Business Indicator Waiting period for licenses to be approved is the longest in Asia • Number of Days until License is ApprovedExamples of waiting periods for various licenses in Indonesia

3. Source : BKPM

4. Overview of Corruption in Indonesia Anti Corruption Team Permissiveness towards corruption Inadequate Laws and Regulations Weak law enforcement Lack of Role Models and Leadership Governance Systems, business managements, and a public that do not heed principles of Good Governance ! Beragam sebab lain Various other causes Corruption becomes more difficult to eradicate and continues to thrive

5. The KPK's Duties(Article 6)‏ Law No. 30 of 2002 Coordination (Article 7)‏ Supervision (Article 8)‏ Duties of KPK (Article 6)‏ Monitoring (Article 14)‏ Pre-investigation, Investigation & Prosecution (Article 11)‏ Prevention (Article 13)‏

6. Article 3 Law No. 30 of 2002 The Corruption Eradication Commission is a state agency which, in the performance of its duties and authority, is independent and free of any undue influence. “Undue influence” should be understood as any influence that can negatively affect the performance of the duties and authority of the Corruption Eradication Commission or those of the Commission members individually from executive, judicative, legislative, and other parties related in a corruption case, or in any other situation, and with any reason.

7. Coordination Law No. 30 of 2002 Article 7 In performing its coordination duties, the KPK, is authorized to: Coordinate the pre-investigation, investigation and prosecution of corrupt acts AGO Police b. Establish a reporting system within the corruption eradication system Supreme Treasury BPKP c. Request information on corruption eradication activities Non-departmental Government Auditors d. Conduct meetings and exchanges of experience with related agencies Departmental Auditors e. Request corruption prevention reports from related agencies Bawasda

8. Supervision Law No. 30 of 2002 Article 8 In performing supervision duties, the KPK is authorized to: Police AGO Perform monitoring, research or analysis on agencies authorized and empowered to eradicate corruption, as well as institutions that perform public services (sub-article 1) BPK BPKP Dep. Auditors Bawasda Departements, Non-Departments, Ministries (public services)‏ Take over investigations or prosecutions of corruptors being performed by the Police or the AGO (sub-article 2) Police AGO Articles 9, 10

9. UU No. 30 Tahun 2002 Duty of Prevention (Article 13)‏ The KPK is authorized to perform the following prevention duties and steps: Construct a list of, and conduct examinations on, the wealth of public officials Receive reports on, and establish the status of, graft/gratuity Department of Education and all other education agencies Implement anti-corruption education programs at all levels of education Design and ensure the execution of the KPK's prevention socialization program Mass Media, NGOs, Religious organizations The public Conduct anti-corruption campaigns for the benefit of the public Foreign Entities Conduct bilateral and multilateral co-operations in eradicating corruption

10. Law No. 30 of 2002 Duty of Monitoring (Article 14)‏ The KPK is authorized to conduct the following duties and steps: Analyze administrative management systems At all government agencies and state institutions Provide suggestions for change if, based on the KPK's analysis, the relevant administrative management system is deemed potentially corruptible To all leaders of government agencies and state institutions Report if the KPK's suggestions for change are ignored To : President, DPR, & BPK tugas

11. 1.Conducted under orders from KPK Commissioners PRE-INVESTIGATIONS (LID)‏ * Obtain sufficient preliminary evidence = 2 items of evidence (including information/data that is uttered, sent, received, or kept either physically or electronically/optically – article 26A of Law No. 20 of 2001)‏ * If such evidence is found within 7 days, the pre-investigators will report to the KPK *The results of such a report would be investigated by the KPK or transferred to the Police or AGO * If such evidence is not found, the KPK shall cease pre-investigation activities 2. The law envisages counter-suits to rehabilitate reputation as well as the compensation of wronged individuals; further, the KPK may be subject to quasi-legal suits (pra-pengadilan). INVESTIGATIONS (DIK)‏ * Special procedures in examining suspects are not applicable * Confiscations can be performed without a Court Warrant • Suspect is obliged to provide information on all his/her assets, along with those of his/her spouse, children, and organization/corporation, should they reasonably be expected to be related to the suspect's corrupt act • No authority to execute an SP3 document (stops investigations mid-way)‏ • Coordinate/control the investigation of connected cases PROSECUTIONS (TUT)‏ * The KPK hires its own resident General Prosecutors * 14 days after a file is received, it will be delivered to the Court • Delivery is made to the Ad Hoc Court of Corruption, which is located at the Central Jakarta District Court (article 38B on reversing the onus of proof for assets)‏ * Decisions must be made within 90 days * The Law contemplates the possibility for appeals * Searches are to be conducted according to the Criminal Code of Procedures and Law No. 31 of 1999 Jo Law No. 20 of 2001

12. Corruption Prevention Efforts: Promoting Good Governance by using the “Island of Integrity” Approach Mobilize the public through education and by increasing awareness in anti-corruption issues Implementing performance-based management Implementing corruption eradication in the area of goods and services procurement Implementing reporting mechanisms for use by the public Increasing the capacity of regional governments Implementing reforms on the provision of services by the public sector Opening access to information Training and technical assistance Exchanging information on corruption issues.

13. Implementation of Island Integrity Integrity Pact Public Services Provision One Stop Service Law Enforcement Budget Liquidity Performance-based Benefits Administrative Public Procurement Performance-based Budgets Financial Performance Agreement Public Participation Public Participation Public Complaint Mechanisms Performance Accountability LHKPN & GRATUITY

14. Riau Province  July 2004 • Gorontalo Province  October 2004 • Kalimantan Selatan Province Okctober 2005 • Kalimantan Tengah Province 14 March 2006 • Denpasar City Government  14 Agustus 2006 • Jambi Province  15 May 2007 • DIY Province  31 May 2007 • Makassar City Government  May 2007 • Kebumen Regency Government  6 June 2007 • Yogyakarta City Government 8 June 2007 15

16. Description • A one-door/location licensing or non-licensing services provision system • Legal Basis needs to be established for the formation and operation of Combined Services in the form of Perda (regional regulations) or SK (instruction letters) from regional heads (Regents and Mayors) • Usually in the following forms: Office (dinas/kantor), Unit, or Post • 1. Forms of license services provided: IMB,HO,SIUP,TDP,IUI,Business License, etc 2.Forms of non-license services provided: Birth, Marriage, and Death Certificates; National Ids; Family Cards, etc • Transparency in finances, time to finish, and procedures • The size of the cost, time to finish and the procedures for all types of licensing/non-licensing services provided shall be attached to brochures, posted in waiting rooms and explained by customer services so that the public can readily observe these information when they attend to their licensing needs • Time to finish should be within 1 to 12 working days (2 weeks)‏ 18

17. One Stop Service (OSS)‏ One Stop Service (OSS)‏ Various licensing/non-licensing services performed at one location/building Customer service is present The public interacts only with customer service in processing licensing/non-licensing services Payment can only be made at the cashier/bank All technical and administrative processes of licensing and non-licensing services shall be performed under one roof The recruitment of technical personnel from technical units/agencies to perform technical activities Transparency in the areas of procedure, time to finish, cost, and pre-requisites Excellent coordination between technical agencies, due to representation from OSS Allows parallel processing of separate licensing/non-licensing services. License Processing Flow One Stop Services (OSS) / One Door and One Roof Services Technical Officer 1 Authentific ation Officer Public Customer Service Technical Officer 2 Technical Officer 3, etc Administration 19 BLUE LINES: Processes involving internal licensing operators RED LINES: Processes involving the public

18. Impact of One Stop Service Licensing HO : Nuisance Permit TDI : Industry Listing Mark TDP : Company Listing Mark SIUP : Business Permit Direct Impact: Wait time reduced (days)‏ 20 Source: Sintap Pare Pare

19. Impact of One Stop Service Licensing Direct Impact: Reduced costs (in thousand Rupiahs)‏ Indirect: Increases PAD Decreases Corruption 21 Source: Sintap Pare Pare

20. Impact of Combined Services Office at the Sragen Regency Government Pro-investment policies • Combined Services Office: • Provides 52 licensing & 10 non-licensing services • Maximum waiting time per 1 license service: 12 days • On average: 400 licenses/month • In 2002 (before KPT) towards 2003: • Micro, small and medium industry investments: • Increased from Rp.30,7 billion to Rp. 35,2 billion (16,6%)‏ • Large industry investments: • Increased from Rp. 110 billion to Rp. 394,8 billion (213%)‏ • Employment: • Increased from 28.976 persons to 41.800 persons (44,29%)‏ Source: Kompas, 22 Sep. 2006 PAD (Real Regional Income)‏ 22 Source Pemkab Sragen

21. Permendagri N0. 13 of 2006, article 39 sub-article (2): Additional Income as provided for in (1) is given with the intention of increasing personnel welfare, based on the burden of work or work conditions or the rarity of a profession or work performance • Legal Basis in the form of a Regent/Mayoral decree is required • Provided for all civil servants at the relevant regional/city government • Performance benefits to be paid at the end of each month • Doesn't add to the budget: • The source for welfare benefits shall be previous regional budgets dedicated to project commissions, or other sources. 23

22. SAMPLE REGIONAL WELFARE / PERFORMANCE BENEFITS 24

23. Reduces face-to-face meetings between tender vendorsand committee: • Vendorswon't need to be present physically – involvement is mediated via internet. • Vendorspresent physically must show documentation to be checked versus a version already sent through the internet • Mindful of the priorities of small businesses • 2005 : 1066 (73%) small businesses won an Rp. 203,26B bid • 14 Agencies and Regional Governments formed MoUs with the City Gov. of Surabaya w.r.t. e-Procurement • Impacts: • Owner Estimate efficiency contributed to savings at 20%, • Budget efficiency increased 23.5 % • A round of auction averages 20- 28 days now; used to be 36 - 45 days 25

25. The purpose of this survey is to perform scientific measurements on the level of corruption, specifically on the root causes of corruption conducted at public agencies, by surveying direct users of public services (from the perspective of service users, not service providers). • Approach : to find the root causes of corruption in the area of public service provision • Public agencies need to be assisted in preparing effective prevention efforts at geographical places and specific services where corruption is most apparent • Public agencies need to be encouraged to actively pursue preventive efforts against corruption • There needs to be adequate check and balance mechanisms in order to improve the effectiveness of controlling corruption in public services, specifically in areas where service users and providers interact (This survey is biased on the side of the user)‏

26. The survey shall produce an integrity score/index of the sample population of public agencies • Survey will be conducted as a “time series” (annual product of the KPK)‏ • Survey results shall be disseminated to the public --> this is hoped to increase performance and integrity levels of the sample population of public agencies • The sample size will be increased yearly

27. PUBLIC SERVICE INTEGRITY SURVEY Measurement Methodology 1. Experience of Integrity: • Reflects the perception and experience of respondents with regards to the level of experienced corruption (based on the personal experiences of the respondents)‏ 2. Potential Integrity: • Reflects the factors which are the potential causes for corruption, as perceived by the respondents (indicates the existence of factors that may correlate with the occurrence of corruption in the future)‏ • The higher the level of integrity, the smaller the possibility that a user of public services will experience corruption, perceive the occurrence of corruption, and perceive factors in an administrative system that have corruptive potential 29

28. Total Integrity Variables Indicators Sub-Indicators Total Integrity 5.53 Experience of Integrity (0.705) - 5.34 Experience of Corruption (0.748) - 5.52 Frequency of giving gratuity (0.694) - 4.07 Value/Amount of Gratuity (0.306) - 8.82 Perspective on corruption (0.252) - 4.78 Perspective on the level of gratuity-giving (1.000)‏ Potential Integrity (0.295) - 6.00 Work Environment (0.265) - 7.90 Solicitation for, and offer of, gratuity (0.658) - 8.20 Need for Multiple On-site Visits (0.342) - 7.32 Administration System (0.303) - 4.02 Practicality of SOP (0.294) - 8.22 Level of Access to Information (0.706) 2.27 Behaviour of Service Personnel (0.261) - 6.68 Fairness in service provision (0.727) - 6.19 Expectancy of gratuity (0.273) - 7.98 Corruption Prevention Efforts - 4.07 (0.171)‏ Level of corruption prevention efforts(0.556) - 2.91 Ease of delivering complaints (0.444) - 5.53

29. Score is Below average 5.34 Experience to pay bribe Experience corruption Permissive Society Corruption Perception 4.78 Administrative System 4.03 Service Procedure not properly announced (requirement, length, cost,) Prevention Effort 4.07 Public complaint handling

30. Average Score for Experience of Integrity Average score for Total Integrity Average Score for Potential Integrity

31. On a scale of 1-10, The average score for the Indonesian Public Sector Total Integrity is 5,53 for 2007. (Korea's Integrity Score for 2006 is 8.77)‏ • The Experience of Integrity Score (5.34) is lower than the Potential Integrity Score (6.00)‏ • Even though the average Potential Integrity score is still relatively low, it shows that generally systems and environments that can support the implementation of transparency and personnel professionalism in servicing the public do exist • However, the existence of such systems is not enough to deter bribery in public services provision

32. 45 % of public service users perceive the giving of incentives to a public service provider to be normal conduct (A PERMISSIVE user base)‏ • 100% of the 88% respondents who provide incentives for DKP cold storage services perceive such giving of incentives as normal conduct • The level of tolerance of the user base in perceiving corruption in public services provision actually differs across service units. This indicates that certain service units are venues where the payment of bribery for services by users is considered day to day business A Permissive Public

33. Total Score and Ranking of Agencies per the KPK's Public Sector Integrity Survey Table 4.1. Total Score and Ranking of Agencies' Integrity Department Experience of Integrity Potential Integrity Integrity Score Rank BKN (State Employees Board)‏ 5,887 7,336 6,314 1 Ministry of Home Affairs 6,145 6,488 6,246 2 PT. PERTANI 6,024 6,517 6,169 3 Dep. Of Trade 5,991 6,591 6,168 4 TASPEN (PNS Insurance & Pension Fund)‏ 6,016 6,368 6,120 5 Dep. Of Cooperatives and SMEs 5,911 6,523 6,092 6 BPOM (Nat. Agency of Drug & Food Control)‏ 5,785 6,811 6,088 7 Dep. Of National Education 5,817 6,489 6,015 8 PT. ASKES 5,801 6,368 5,968 9 Supreme Court 5,297 5,237 5,279 21 Dep. Of Health 4,846 6,211 5,249 22 PT.PLN 4,951 5,642 5,155 23 Dep. Of Religious Affairs 4,916 5,715 5,151 24 Dep. Of Manpower and Transmigration 4,404 5,927 4,853 25 Indonesian Police 4,795 4,839 4,808 26 PT. Pelindo 4,502 5,386 4,763 27 Dep. Of Communications 4,184 4,383 4,242 28 BPN (National Land Agency)‏ 3,882 4,835 4,163 29 Dep. Of Law and Human Rights 3,919 4,696 4,148 30 Average 5,335 5,998 5,531

34. Winning Public Hearts and Minds: • Public Services: • Combined Services • Education • Health • Revolving Fund‏ • Integrity Pacts:Combined Services,Goods and Services Procurement,Core Duties and Functions (Tupoksi)‏ • Public Participation in development activities • Winning Public Servants' Support: • Welfare benefits, should be tied to performance • Performance Agreement,should be tied to incentives such as welfare benefits • Corruption Prevention: • Goods and services procurement • Performance based budgeting • Giro to Giro • Integrity Pacts • Efficiency of Governance: Rationalizing Organization Structure, Performance Accountability

35. Where will the winds of change take us? Massive education And campaign A Civil Society that is no longer permissive towards corruption Public Teaching on moral and ethic Judiciary apparatus Government Renewed Governance Structure (PTKP)‏ Public service sector Political representation Good Corporate governance Codes of Ethics Businesses Anti-bribery movement 37 Fair competition

36. KPK Plans for the Future Continue to encourage good governance in central and regional governments in the form of coaching through cooperation with relevant agencies (Ministry of Civil Service Reforms and BPKP)‏ Educate the people in all level, on moral and ethic as well as anti corruption awareness Perform monitoring and evaluation on regions that have implemented good governance practices Measure the impact of implementing good governance at participating regional governments Develop ideal models of good governance practices, and distribute the results to regional governments Encourage Bureaucracy Reforms in Government institution KPK to launch a Public Sector Integrity Survey Measure the 'experience of bribery' and the 'occurrence of corruption' 38

37. Pilot Project of the Bureaucratic Reform 2006 2007 2008 2009 2010 onwards Legal Certainty Improved Investment Supreme Court Improved State Income Dir. Gen. Taxes Dir. Gen. Customs & Excise Bureaucratic Reform Attorney General’s Office Supreme Auditor’s Office National Police Armed Forces Immigration Investment Coord. Board MoreReform Land Agency Instansi lain

38. Thank You! Moch. Jasin Mochammad jasin@kpk.go.id 40