Decentralization of Forest Administration in Indonesia, Implications ...

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Origins and Scope of Indonesia’s Decentralization Laws
happened in the forestry sector. On the contrary, with the decentralization process in the
forestry sector moving far more rapidly than they had perhaps anticipated, policymakers
at the MoFEC soon began taking steps to recentralize forest administration. They did
so initially by structuring Law 41/1999 on Forestry, issued in September 1999, to
reaffirm the Ministry’s dominant role in administering the nation’s forest resources.
This process of forest sector recentralization was taken further with the enactment of
Government Regulation 34/2002, which revoked Regulation 6/1999 and reinforced
the MoF’s primary authority to administer commercial timber extraction, the sector’s
principal source of revenues. The sections that follow examine these two important
pieces of forestry sector legislation in some detail.
3.7 Law 41/1999 on Forestry
Law 41/1999 on Forestry was signed by President Habibie on September 30, 1999,
nearly five months after Law 22/1999 on Regional Governance was enacted and
seven months before Regulation 25/2000 was put into effect. Officially presented as
a new legal framework for the administration of Indonesia’s forest resources, Law
41/1999 superseded the Basic Forestry Law 5/1967. The preamble to Law 41/1999
explains the need for a new law in Indonesia’s forestry sector by stating that the Basic
Forestry Law – enacted in the early months of Soeharto’s New Order regime – “is no
longer in accordance with the principles of forest administration and authority and
with the demands of the developing situation, and thus needs to be replaced.” In this
way, the Habibie government arguably sought to use Law 41/1999 to distance itself
from the New Order government’s forestry sector policy, together with its legal and
administrative underpinnings.
In many respects, however, Law 41/1999 appears to have been structured to
limit the extent to which administrative authority in the forestry sector would actually
become decentralized. Indeed, the new forestry law largely focuses on defining – and,
to a significant degree, reaffirming – the role of the central government in administering
the nation’s forest resources. Law 41/1999 assigns the central government primary
authority in each of the substantive areas of forest administration that it covers:
• Defining the status and function of forests (Art. 2);
• Carrying out forest inventories (Art. 4);
• Determining the boundaries and classification of forest lands (Art. 4);
• Forming forest management units (Art. 4);
• Conducting forestry planning (Art. 5);
• Overseeing the use of forests and utilization of the forest estate (Art. 5);
• Managing forest protection and conservation (Art. 5).
The far-reaching authority vested in the national government by Law 41/1999
is summarized in the official elucidation that accompany the law, as follows:
[T]he Nation gives the [Central] Government authority to organize and
regulate everything associated with forests, the forest estate, and forest
products; to define the forest estate and/or change the status of the forest
estate; to define and regulate legal relationships between people and forests