Australia Indonesia Partnership for Decentralisation (AIPD)

The Australia Indonesia Partnership for Decentralisation (AIPD) supports the Government of Indonesia to improve the performance of provincial and local governments. More specifically, AIPD aims to improve public service provision in health, education and infrastructure. AIPD works with the central government as well as five provincial governments, namely Papua, West Papua, East Nusa Tenggara, West Nusa Tenggara and East Java, and 20 district governments within those provinces, starting from 2011 to 2015.

The program focuses on resource management, covering both human and financial resources. AIPD creates an enabling environment for provincial and local governments to improve their performance so that sectoral initiatives to improve health, education and infrastructure services have a greater chance of success. At the same time, AIPD pilots new development models that can be replicated in other provinces and districts.

AIPD also plays a role in policy development. By capturing the real challenges that provincial and local governments face and presenting them as feedback to the central government, AIPD contributes to the development of better policy. In other words, AIPD helps make decentralisation work.

AIPD’s approaches:
To achieve these aims, AIPD has three components: responsive government, active communities and knowledge management. These terms serve as shorthand to identify the range of stakeholders with which the program works. As an example, in the context of public service provision, responsive government denotes different levels of government, while active communities refers to civil society or the broader community, including provincial and district parliaments, media, universities and civil society organisations. These two components underpin the knowledge management component, which ensures lessons are learned and good practice is disseminated.

Three main components of AIPD:

1. Builds the capacity of government stakeholders to more effectively allocate and manage available resources, particularly through developing improved public financial management, focussing on education, health and infrastructure services.
2. Supports the generation, sharing and use of knowledge for development, particularly in the context of decentralisation and improved service delivery.
3. Supports civil society stakeholders to more actively and effectively engage in and influence resource allocation and management and decision-making by local authorities (both executive and legislature), and enhance participation and representation of media and civil society organisations.

Why public financial management (PFM) is considered of particular importance to effective decentralisation in Indonesia :
1. Significant resources are available to both provincial and district governments, but are not being optimally allocated or managed.
2. Improved PFM is a ‘public good’, in that it supports systemic improvements that impact on all areas/sectors of government activity.
3. Improved PFM is a key platform for good governance, including increased transparency and accountability.
4. Both government and civil society stakeholders need to be engaged in improved PFM. This includes the executive, the legislature and CSOs.
5. Improved PFM directly supports the aid/development effectiveness agenda, in that it builds P/LG capacity to effectively allocate and manage resources from any source, including donor funds.

Gender Mainstreaming:
AIPD is committed to gender mainstreaming and achieves this in two ways: (i) by applying a quality-at-entry process which evaluates whether gender has been properly addressed in each activity, and (ii) by promoting gender equality with partners, including identifying entry points for institutional reform.