3. Effective Governance
3.1 Democratic Representation
3.2 Lack of Corruption
3.3 Efficient Administration


3. Effective Governance

Goal – A popularly elected government free of corruption and functioning efficiently and transparently enough to guarantee economic freedom to individuals and support equitable property markets

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3.1 Democratic Representation (Strong)

Core Question: Does the country have free and open elections for the leadership and can citizens engage in free enterprise?

Yes. Indonesia’s government has loosened market intervention and the voice of the public is often expressed freely, however there are some conflicts of interest between the branches of government in Indonesia, which has led to some mistrust of the public.


3.1.1  Voice & Accountability (Strong)

Overall Ranking – 54 out of 167  Are citizens able to elect their government and do they enjoy freedom of expression, association and a free media?

Yes. Percentile Rank 51.1 (2012); Trend ↑

Source: Governance Matters 2010, World Bank Are citizens free to form political and civic organizations free of state interference and surveillance?

Yes. Score 6.7 out of 10

Source: The Economist Intelligence Unit Democracy Index 2013


3.1.2  Public Information (Strong)

Overall Score 77 out of 100 (2013) Are there regulations governing conflicts of interest in the executive and legislative branches of government?

Executive Score: 69 out of 100 (Weak); Legislative Score: 73 out of 100 (Strong) Can citizens access legislative processes and documents?

Yes. Score: 88 out of 100

Source: Global Integrity Report 2013 – Indonesia


3.1.3 Market Intervention (Weak)

Overall Ranking 100 out of 178, Trend ↑ To what extent does the government intervene in the private sector including state owned industries?

Score: 89.9 out of 100 with a higher score indicating less intervention. To what extent does the government control prices?

Score 76.4 out of 100 with a higher score indicating less control.

Source: Index of Economic Freedom 2014 – Heritage Foundation


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3.2 Lack of Corruption (Weak)

Core Question: Is the public sector transparent and free of corruption?

Corruption in Indonesia remains a very serious problem and is mostly seen through public opinion surveys and how each government system is set up. Corruption in the justice sector undermines the rule of law and results in the inability to enforce laws and uphold justice. Even though Indonesia’s the civil service is strong, high levels of corruption are found in the police department and Supreme Courts with high costs and unfair decisions.

Transparency (Very Weak)

3.2.1   What is the perceived level of corruption in the country?

Ranked 157 out of 180; Score  22 out of 100; Trend ↑

Source: Corruption Perception Index 2014, Transparency International


Integrity Mechanisms (Very Weak)

3.2.2   A National Integrity System is a framework where the principle institutions that contribute to integrity, transparency and accountability in a society can address corruption in a systematic way. Does a National Integrity System exist?

No NIS assessment has been conducted for Indonesia.

Extralegal Payments (Strong)

Survey Question

SQ 11  How often do companies report that officials/and or companies expect additional payments to “expedite” services or gain business?

23% (2009) of firms say they are expected to make unofficial payments on occasional instances.

Source: Enterprise Surveys, World Bank


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3.3 Efficient Administration (Weak)

Core Question: Are quality services and qualified civil servants available to the public through the efficient use of public money free of corruption?

Even though Indonesia’s government spending relative to GDP is well controlled, government effectiveness to implement and enforce laws is low. The quality of civil service in Indonesia is reported to be strong, however many civil servants admit to corruption through bribery (due to low civil service income).


Size of Government (Very Strong)

3.3.1   What is the size of government relative to GDP?  

19% (25% to 30% considered optimum)

Source: Index of Economic Freedom, Heritage Foundation


Civil Service (Strong)

3.3.2   What is the quality of the civil service?

Score: 75 out of 100

Source: Global Integrity Report 2013

Government Effectiveness (Weak)

3.3.3   What is the overall effectiveness of the government?

Percentile Ranking: 44, Trend ↓