Decentralization of Forest Administration in Indonesia, Implications ...

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Barr, C. et al. 105 the harvest or sale of illegal logs. Related to this, both the Ministry and provincial forestry authorities have become increasingly stringent in enforcing the government’s requirement that logs be accompanied by official transport documents (SKSHH), which require that they originated from a supplier with a legally-recognized harvesting permit. In some districts, officials have reported that they are concerned that timber flows from their regions could be disrupted, either by buyers or by law enforcement authorities, if logs originating in those regions are not accompanied by SKSHH documents (Resosudarmo 2004b). It is also likely that district governments have had a strong financial incentive to comply with the MoF’s regulations. By mid-2003, Indonesia’s decentralized fiscal balancing system was operational, and most district governments were highly dependent upon fiscal transfers from the central government. Forest-rich regions, in particular, have had a strong vested interest in ensuring that transfers of the Reforestation Fund were not delayed or disrupted, as the amounts of money involved are often quite substantial. In some cases, it is also possible that local authorities recognized that district governments were losing large amounts of revenues under the decentralized district timber regimes, as it was extremely difficult for them to fully monitor large numbers of small-scale timber operators. Some district officials may have decided that they stand a better chance of maximizing district timber revenues by actively cooperating with provincial and central government authorities, and structuring commercial timber extraction around a more limited number of mediumand large-scale logging concessions. With the reconsolidation of its authority over the last several years, the MoF again holds far-reaching control over the administration of timber extraction in Indonesia. It must be emphasized, however, that after three-and-a-half decades of intense exploitation of Indonesia’s forests, the resource base now administered by the Ministry is much diminished as compared to that which it managed at the height of the New Order period. In recent years, the Ministry has sought to put the sector on a more sustainable track by sharply limiting the annual allowable cut (AAC) from the nation’s natural forests. In 2003, the Ministry initiated its ‘soft landing’ policy by temporarily reducing the AAC to 6.9 million m 3 , and to 5.7 million m 3 the following year. Although the AAC has risen to 8.1 million m 3 in 2006, it remains well below the levels recorded during the Soeharto era. In practice, Indonesia’s actual timber harvest is undoubtedly well above the levels designated by the AAC. Nevertheless, the MoF’s formal restriction of the annual allowable cut has given it added leverage to restrict or halt the activities of timber companies operating without an annual work plan (Rencana Kerja Tahunan, RKT) that has been formally approved by the Ministry. In recent years, the Ministry has suspended or revoked numerous IUPHHK licenses issued by district or provincial governments that have been determined to be operating in violation of central government regulations. In January 2005, the MoF adopted a set of guidelines to verify whether IUPHHK concession licenses allocated by Governors or Bupatis had been issued in a fully legal and appropriate manner. 10 The Ministry has established a team consisting of members from the Ministry’s own Directorate General of Forestry Production; Planning Agency; and Bureau of Legal Affairs. None of the team
106 Decentralization’s Effects on Forest Concessions and Timber Production members come from the district or provincial governments that issued the licenses under review. At the same time, the Ministry had taken steps to accelerate the expansion of Indonesia’s timber resource base by actively promoting fast-growing plantation development. It has done so, for instance, with the issuance of Ministerial Decree 101/2004 on the Acceleration of Industrial Plantation Development to Supply Raw Materials for the Pulp and Paper Industry, issued in March 2004. 11 This decree requires plantation companies owned by pulp and paper producers to fully establish their fastgrowing plantations by 2009. The Ministry has also reportedly issued numerous new IUPHHK licenses for plantation development to supply both existing and planned pulp mills, although a complete list of these is not yet publicly available. Under Regulation 34/2002, the new industrial plantation licenses will last for a period of 100 years, substantially longer than the 42 years assigned to holders of Industrial Timber Plantation (Hutan Tanaman Industri, HTI) under the previous framework. As noted earlier, district and provincial government formally have little role in the licensing process beyond providing a recommendation on the proposed license for the Ministry’s consideration. For their part, many Bupatis and Governors have responded to the recentralization process that has occurred in the forestry sector by expressing keen interest in the development of oil palm estates and other types of agroindustrial plantations. This interest in oil palm, particularly among district governments, in undoubtedly linked to the fact that their respective roles in the licensing and regulation of agroindustrial estates is greater than that which they now hold in forestry. This has, in turn, led Bupatis and Governors in some forest-rich regions to look for ways to have forested areas reclassified as either Conversion Forest, or Areas for Other Uses (Areal Penggunaan Lain, APL), so that it can be freed for conversion to oil palm.
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Decentralization of Forest Administ
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National Library of Indonesia Catal
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iv 4.5 Forest Revenue Sharing 69 4.
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Preface Indonesia is currently ente
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Acknowledgements This study is base
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Abbreviations AAC ACIAR ADEKSI APBD
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IPHHBK IPHHK IPJL IPK IPKR IPKMA IP
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Glossary Adat, customary or traditi
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Forests and Decentralization in Ind
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10 Forests and Decentralization in
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Chapter 2 Forest Administration and
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20 Forest Administration and Forest
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32 Origins and Scope of Indonesia
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156 Annex 3. Distribution of Shared
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Since the collapse of Soeharto’s
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