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Working Paper INISIATIF No.03, 2009 (Oct)

The Right Based Approach to

Regional Development : Putting

BackEquity in Development

Policy

1

1

AdenanteraDwicaksono2Jl.GunturSariIV/16,Bandung,JawaBarat Indonesia/PerkumpulanINISIATIF

[email protected]

Abstract.Theconventionalapproachtoregionaldevelopmentisunderincreasingcriticismquestioning its efficacy in solving the contemporary issues in regional development.

Economicgrowthandmarketbaseddevelopmenthasnotbeenabletosolvetheproblem

ofinterregionalandinterpersonaldisparity.Intheeraofdiminishingroleofthestate,the

new policy debates calls for a more active roles intervention to resolve issues of

inequalityandequity.Therightsbasedapproachoffersopportunities,whichreinstatethe

newmeaningofstatesroleindevelopment.Thecasesoftwomunicipalitygovernments,

SurakartaandBandung,inrespondingtheissuesofinformalstreettraders/pedagangkaki

lima,shed

the

light

of

possible

application

of

the

approach

in

the

future

in

the

context

of

decentralization.

Keywords:rightsbasedapproach,informalsectoreconomy,streetvendor,urbandevelopment

1 This paper is presented in the International Conference on Urban and Regional Planning:

Celebrating50thAnniversaryofPlanningEducationinIndonesia,Bandung1213November20092 AdenanteraDwicaksonoisChiefofDivisionofPublicPolicyReform,PerkumpulanINISIATIF
mailto:[email protected]:[email protected]

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2

IntroductionThe conventional wisdom of economic growth is at stake in the current debate of

regional3 development. Over the half century from its first inception during Harry

Trumansinaugural

speech

on

January

20,

1949,

the

development

projects

have

failed

to

meet their promises, instead they move to opposite direction: massive

underdevelopmentand impoverishment,unfoldexploitation,andoppression[3,p.4].

The achievement of high level economic growth does not necessarily resolve the

fundamentalproblemsofpovertyandunequalincomedistribution[4,5].

BarEla and Schwartz [5] reviews the burgeoning body of literatures on regional

developmentandfindthateconomicgrowthoftenrequiresaconcentrationofstronger

elementsof theeconomy, suchas: investments in regionswithbetter infrastructures

andpopulationswithbettereducationand skills.Thissituation inevitably leads to the

concentration in selected populations or regions of benefits from growth, which will

then generates interpersonal and interregional disparities [5]. This framework of

analysiscanbeusedtoexplainthedisparityphenomenainIndonesiadespiteofthehigh

levelofeconomicgrowthachievement.

AsIndonesiaenteredaneweraofdecentralizationin2000,therehavebeensignificant

changes in interregional wealth distribution. Within this decentralization framework,

more resources have been distributed to the regional governments. Theoretically

speaking, this new situation gives leverage to regional governments tomanagemore

resource for development. However, as shown by Islam [6], preliminary assessment

indicates that the new fiscal decentralization framework exacerbates the prevailing

spatial inequality. This situation calls for alternative approach for policy options to

resolveissuesofinequalityintheeraofdecentralization.

This paper proposes the rightsbased approach to development as an alternative

frameworkfordevelopmentpolicy.Therightbasedapproachhastheleveragetofocus

peoples attention on the issues of equity. It begins with the review of Indonesias

developmentpolicy.Thesubsequentsectionwilllaysthefoundationoftherightbased

approach framework, comprising its basic concepts and theoretical underpinnings,

3SeeDawkins[2]forthediscussionabouttheconceptofregion.Theconceptofregionused in

thispaper sees regionas subnationaladministrativeentity.Thus, in the contextof Indonesia,

region refers to Provinsias the firsttier regionand the Kota (Municipality)or Kabupaten

(District),asthesecondtierregion.Thefocusofthispaperisthesecondtierregion.

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principal featuresand thediscussionofequity.The later sectionwilldiscuss twocase

studies using the humanright frameworks with reference of Surakarta and Bandung.

The final section concludes the discussions and proposes implications and challenges

planninganddevelopmentpracticesinIndonesia.

IndonesiaRegionalDevelopmentPolicyRevisitedBefore the 1997 economic crisis, Indonesia was praised as one of the Asian Miracle,

whichhadsuccessfullyachievedhighandsustainedeconomicgrowth[7].Togetherwith

otherHighPerformingAsianEconomies, Indonesiahadbecomeamodel forrapidand

propoor growth economy [8]. During this period, Indonesia attained remarkable

economic and social achievement. According Dowling and ChinFang [9], Indonesia

succeeded to transform the country from a poor country to a major producer of

industrialproductsinSoutheastAsia.Bytheendofthe1990s,thepovertylevelfellfrom

64.3%to11.4%;domesticinvestmentasashareofGDPincreasedfromlessthan10%in

the1960stoover30%inthe1990s;andagriculturesshareofGDPfellfromover50%in

the1960stolessthan20%by1997[9].

Thesesuccessescanbetracedbacktothebeginning1967,whenSoehartosuccessfully

overthrew the formerPresident Soekarno,and started hisNewOrder regime. In this

period, Indonesiachanged thedirectionof itseconomicorientation from thepopulist

economy as the legacy of the former regime toward a more pragmatic and market

orientedeconomy[10].ChalmersandHadiz[10]furthers identifiesthethreephasesof

Indonesiaseconomicdevelopmentfrom1967tothelate1990s,namely:theeconomic

reconstructionperiod(1967mid1970s);the oilboomyearsera(19741982);andthe

eraofeconomicstructuraladjustment(mid1980slate1990s).

During theperiodofeconomic reconstruction in1967mid1970s,centralgovernment

policiesfocusedonrestoringcountryseconomicactivitiesoncewerehaltedduringthe

politicalandsocial turmoil.According toChalmersandHadiz [10], thisperiodwas the

mostcriticalphaseforSoehartosNewOrderregimetoassert legitimacyofhispower.

Therefore, restoring political and economic stability had become the main agenda of

Soeharto. With the loyal military forces behind him, Soeharto had successfully

eliminatedany

political

opponents

and

suppressed

any

views

that

might

compromise

his

power.Soehartoalsotookamorepragmaticandmarketorientedeconomicpoliciesto

establisheconomicstability.

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ThesecondphaseofIndonesiaseconomicdevelopmentwasduringtheoilboomyears

19741982.ThiswastheperiodwhentheNewOrderRegimesuccessfullyreinforcedits

controland legitimacy.With thevirtuallyunlimited financialresourcesas the resultof

theboomingofoil revenues,centralgovernmentwasable to financeextensive social

andrural

development

projects

across

the

country

[10].

During

this

era,

the

central

government introduced the INPRES program whose purpose was to support the

financial capacity of regional government [11]. This interregional equalization fund

transfer policy coupled by strong control from central government had been able to

maintainarelativelylowlevelofregionaldisparity[6,12].

The third phase of economic development was during the massive downfall of

internationaloilprices inthemidof1980sto late1990scausingtheplummetedstate

revenues[10].Duringthisperiod,Indonesiawashitbyaseriesofexternalshocksduring

the1980s,butstillmanagedtosustainannualeconomicgrowthofabovetheaverageof

5% per annum [13]. The external shocks had significantly reduced states revenue

particularlyfromtheoilandgassector[14].Thissituationledtothesubstantialcutsin

governmentexpendituresandreductionsindomesticsubsidiestooil,publicenterprises

andfood,aswellasthecancellationofdozensoflargepublicsectorprojects.Lateron,

thecentralgovernmentlaunchedanumberoffinancialsectorpoliciesandembarkeda

more free market orientation policies [14]. Nonetheless, Bhattacharya and Pangestu

[13]arguethatthe longtermtrendhasbeen influencedby two factors:1)bigshift in

Indonesiasexternalenvironment;and2)theevolutionofpolicyaimingthe integration

countryseconomy intoworldmarketsystemandyetstillpreservingadegreeofstate

controlover

national

economy.

Althoughprior to theeconomiccrisis in1997, Indonesiaachievedmagnificent levelof

nationaleconomicgrowth,issuesofregionaldisparitiesarestillpervasive.Thestudyof

GarciaGarcia and Soelistianingsih [15] find that prior to economic crisis in 1997,

although the provincial income had increased significantly and provincial income

disparity had decreased, the personal and regional disparities persist. Takeda and

Nakata[16]sharethesamefindingwithGarciaGarciaandSoelistianingsih[15]thatthe

decrease in provincial disparities of GDP per capita was contributed from the high

economic growth at national level. Takeda and Nakata [16] further argue that the

decreasein

regional

disparities

was

caused

by

the

economic

downsizing

in

high

income

provincedue to cutofpetroleumprices, rather thaneconomicgrowth in lowincome

provinces. Soenandar [17] also confirms the previous studies, by showing that the

provinces in West Indonesia region contributed substantially to the national GDP,

accountingforabout80%bytheyearof1997.

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The economic crisis that hit Indonesia in 1997 had lead to political instability and

economic uncertainty. This situation inevitably changed the course of regional

development in Indonesia. The demise control of New Order regime following the

resignationofSoehartofromthepresidencyputtheIndonesianunitarystatefragile.The

threatsof

national

disintegration

had

created

astrong

demand

toward

decentralization

ofeconomicdecisionmakingauthorityanddevolutionofpower to the regional levels

[9]. From 2000, Indonesia embarked the most ambitious decentralization project

amongalldevelopingcountries[18]throughthestipulationoftheLawNo.22/1999on

Regional Autonomy and Law No. 25/1999 on Fiscal Balance between the Centre and

Regions, which were then revised by the Law 32/2004 and Law No. 33/2004,

respectively. These two laws provide wide discretionary powers for the regions and

substantialfinancialandpersonnelresourcestoexercisethosepowers.

The new policy framework of decentralization, including the fiscal decentralization,

entails new formulation of interregional transfer. The new formula is designed to

mediate issues of interregional imbalance [6, 19]. The new arrangement of fiscal

equalization transfer comprises Revenues Sharing/Dana Bagi Hasil, Specific Purpose

Grant/Dana Alokasi Khusus (DAK); and General Purpose Grant/Dana Alokasi Umum

(DAU).

DanaBagiHasil is funds sourced from thennational revenuebudget (APBN),which is

allocatedtotheregionwithrespecttothepotentialownedbytheproducingregionsat

certain level of percentage in order to finance local needs in the context of

decentralization.DanaAlokasiKhususisbasicallyisanearmarkgrantthatisallocatedto

specificregionsandforparticularprogramsbasedoncentralgovernmentprioritiesand

commitments.DanaAlokasiUmum is a block grant particularly designed to equalize

regional governments fiscal capacities to finance their expenditure needs. The DAU

alone is amounted 25% (26% in 2006) of the net domestic revenues [19]. From that

portion,10%ofthefundisallocatedforprovincialgovernments,andtherestisforthe

municipalityanddistrictgovernments.

The new fiscal decentralization arrangement has transferred substantial amount of

financial resources to regional governments. It indicates a significant increase of

resourcestransfer

compared

to

the

old

regime

of

fiscal

decentralization,

which

was

only

accounted around 13.4% in 1995 [16]. The abundant amount of financial resource

managedbyregionalgovernmentsprovidesopportunitiestodecidetheirowncourseof

development and to resolve issues of inequality. However, some preliminary studies

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reveal that the new fiscal decentralization arrangement tends to exacerbate the

disparityissues[6,12].

ReferringtheillustrationaboveonIndonesiasregionaldevelopment,therearestilltwo

majorissues

related

to

Indonesias

regional

development:

resolving

inter

regional

disparitiesand interpersonaldisparities.Such issuesconfirms theargumentproposed

byBarElaandSchwartz[5]withthereferenceofBrazilsexperience.Inordertoresolve

theseissuesofdisparities,BarElaandSchwartz[5]supportthegovernmentsactionsto

takepolicymeasurestofosterbetterincomedistribution.

Thenext sectionwilldiscuss the frameworkof the rightsbasedapproach that canbe

incorporated into development policies. Despite its importance, the discussion of

proposals fordevelopmentpoliciesaimingtoresolve interregionaldisparity isbeyond

the scopeof thispaper.However, it isworthnoting that some scholarshaveoffered

entrypoints

for

discussion

of

such

issues.

Tadjoeddin

et

al.

[12]

and

Islam

[6]

have

advanced improvement proposals for regional fiscal equalization policies with the

specific emphasis on realizing social accord. Soeharto [20] offers criteria of poverty

measurementusing the rightbased orientation. Such criteria can alsobeused in the

formulaofregionalfiscalequalization.Therestofthepaperwillfocusonhowtherights

basedapproachcanbeused inthedevelopmentpolicies inordertoresolvethe inter

personaldisparity.

TheRightBasedApproach

BasicConceptsandTheoreticalUnderpinnings

The rightsbased approach (RBA) emerges as an alternative approach to respond the

conventional approach to development that is mainly influenced by the neoclassical

viewofeconomicdevelopment.Indonesiasexperiencehasshownthatthehighlevelof

economicgrowth isnotnecessarily followedby the incomeequality [15].Timmer [8]

callsformoreactivestateroleinordertorealizeamorepropoorgrowth.

The Human Development Report 2000, states that human rights are not, as has

sometimesbeenargued,arewardofdevelopment.Rather,theyarecriticaltoachieving

it.[21,p.iii].

This

statement

implies

that

it

is

imperative

to

link

development

practices

withthehumanrightsprinciples.Development, intermofitsprocessesandoutcomes,

is subject to the compliance toallhuman rightsprinciples.Gready [22] identifies two

principalvalueadded theRBAmayoffer.The firstvalueadded is thepotentialof the

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approach to recenter the roleof state indevelopmententerpriseusing theprovided

lawframeworkofhumanrights.Thesecondvalueaddedisthat

First,therightbasedapproachmaycontributetoreinstatetheroleofthestateatthe

center

of

development

enterprise

through

leverage

given

by

the

countrys

law

framework.Itmeansthatbyusingcountrys law,individualsandorganizationsareable

tobringcases tocourt inordertosecureeconomicandsocial rights [22].Thesecond

valueadded is that theapproach thrives to repoliticedevelopmentactions inat least

four ways. It redefines development work as rightbased rather than benevolence or

charity; reclaims thekeyprocessofdevelopment;aims toaddress rootand structural

causesofpovertyandconflict;andspeaksthetruthaboutpower[22].

Theemergingrightsbasedapproachisbuiltupontwostrandsoftheoriesandpractices

[23].ThefirstismainlybasedontheworkofAmartyaSen[24],whoconceptualizesthe

dynamicnature

poverty

in

term

of

human

capabilities

and

entitlements,

and

the

growing literaturesofvulnerabilityconcept,which isparticularlyadvancedbythework

ofMoser[25],Bebbington[26],andDFIDlivelihoodanalysisframework[27].Withinthis

theoriesstrand,therightsbasedapproachsharesthesameidealthateveryonehasthe

inalienable rights to livehisorher lifewithdignity.The rightsbasedapproach isalso

influencedbythegrowingdiscourseontheimportanceofinstitutions,governance,and

participation. The work of Gaventa and Valderrama [28] gives the foundation for

community to engage actively in social and formal political process, as an important

strategy to influence and shape the prevailing institutions, structures, and processes

thatwilleventuallyimplicateonesstatusonentitlementtokeyassetstosustainhisor

herlivelihood.

Theprincipalfeatures

Therightsbasedapproachusesthe1948UniversalDeclarationofHumanRights(UDHR)

as the normative framework used for national and international policy setting for

developmentactions.Thisnormativeframework impliesanumberofprincipalfeatures

of the rightbasedapproach.First, itacknowledges thatevery individual, regardlessof

their race, color, sex, language, religion, political or other opinion, national or social

origin,property,birthorotherstatus,istherightsholder.Althoughthenatureofhuman

rightsis

universal,

which

means

that

they

are

the

same

for

everyone

and

everywhere

[29],moreattentionsaregiventothepoorandmarginalizedgroupsofthesociety.The

poorandmarginalizedgroupsareoftensubjecttoanyformsofdiscriminationthatput

themintodeprivation[29].

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Second, the framework specifies the rights that every rightsholder is universally

entitled.TheUDHRandthefollowingcovenants,theInternationalCovenantonCiviland

Political Rights (ICCPR) and International Covenant on Economic, Social, and Cultural

Rights(ICESCR),outlinestheuniversalrightsthateveryhumanbeingisentitled.Hirschl

[30]suggest

that

human

rights

are

categorized

into

negative

(first

generation)

rights,positive(secondgeneration)rights,andcollective(thirdgeneration)rights.

Thenegativerightsareunderstoodasthefreedomfrominterference,whichisclosely

linked with the fundamental freedoms, for instance the freedom of speech. The

positiverights includefreedomtoact inapositiveway,whichtraditionallyconsistof

social rights such as the universal right to services meeting basic human needs (e.g.,

health care, basic housing, education, social security and welfare, and an adequate

standardof living).The termpositive refers to the requirementofstatesactions to

promote thewellbeingof its citizens, rather thanmerely refraining fromacting [30].

The

collective

rights

refer

to

collective

rather

than

individual,

entitlement

to

common

goods[30].

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UNIVERSALDECLARATIONOFHUMANRIGHTSInternationalCovenantonCivilandPoliticalRights(ICCPR)

2OptionalProtocols:

IndividualComplaints

InternationalCovenantonEconomic,Social,andCulturalRights(ICESCR)

InternationalCovenantontheEliminationofAllFormsofRacialDiscrimination

ConventionontheEliminationofAllFormsofDiscriminationagainstWomen

+OptionalProtocol

ConventionAgainstTortureandotherCruel,InhumanorDegradingTreatmentorPunishment

(Ratifiedby132

ConventionntheRightsoftheChild+2Optional

Protocols:

Armedconflict Saleofchildren,

child

prostitution

Figure 1 TheCoreUNHumanRightsTreatiesThird,theframeworkofhumanrightsprovideamorespecificinstruments,whichspecify

minimumstandardsrequiredbeforearightcanbedescribedasmet[29].Astherights

stated in both International Covenant (ICCPR & ICESCR) are often regarded as too

abstracttobetaken intopractice,theHumanRightsCommitteeoftheUnitedNations

publishes its interpretationsof thecontentofhuman rightsprovisions, in the formof

GeneralComments

on

thematic

issues.

For

example,

the

Committee

publishes

the

GeneralCommentNo.14asanefforttospecifytheminimumstandardoftherightto

thehighestattainable standardofhealth (article12of ICESCR).Thegeneralcomment

9

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sets the essential elements constituting the rights to health, which covers the

availability,accessibility,acceptability,andqualityofhealthservices.

As countries ratify the international framework of human rights within their legal

system,the

framework

automatically

binds

state

parties

as

the

principal

duty

bearers,

whosespecificobligationsto(i)respect,(ii)protectand(iii)fulfilltherightsstatedinthe

conventions[1].Thus,failuretoperformanyoneofthesethreeobligationsconstitutesa

violationofsuchrights.Thismeansthat individualsandorganizationsareabletobring

casestocourt ifthestateparty isfoundviolatinghumanrights [22].However,Hirschl

[30]also finds that therearedifferencesamongcountrys legalsystem that treatsthe

justifiabilityoftheeconomic,social,andculturalrights.

Therightsbasedapproachalsofeaturesessentialprinciplesderivedfromtheconceptof

institutions, governance and participation, which put together political rights and

responsibilitiesto

fundamental

aspects

of

human

needs

and

well

being

[23].

UNDP

[1]

calls for integrating the participation and transparency in decisionmaking; non

discrimination;empowerment;andaccountabilityofactorsinallstagesofdevelopment

processes.

HumanRightsandEquityinDevelopment

Equity is the heart of the right based approach to development. However, defining

equity isnotaneasytask.BravemanandGruskin[31]defineequityassocialjusticeor

fairnessanethicalconceptgrounded inprinciplesofdistributivejustice. IntheWorld

DevelopmentReport2006,equity isdefined in termoftwobasicprinciples,whichare

equal opportunity and the avoidance from absolute deprivation [32]. The equal

opportunitymeansthattheoutcomeofapersons lifeshouldreflecthisorherefforts

and talents regardlessofhisorherbackground suchas gender, race,placeofbirths,

familybackground,andsoon[32].Theavoidancefromabsolutedeprivationmeansthat

everyperson isentitled tobe free fromany circumstances thatmay lead toextreme

poverty [32].Thissuggeststhatattentionsshouldbegiventotheneediestmemberof

societyeventhoughtheprincipleofequalopportunityhasbeenupheld.

Thehumanrightsframeworkprovidestherightsholders instrumentstoclaimrightsto

equally

enjoy

the

benefit

of

economic

development.

Decker

et

al.

[33,

p.1]

signal

that

economic development without a concern for equity of outcomes or the social

arrangementsandprocesses thatdetermineallocationsandpower, canonly serve to

reinforceexistinginequalitiesanddeprivation.Thisistheobligationsofthedutybearer

totakeanynecessarylegislative,administrative,budgetary,judicialandothermeasures

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toensure thateveryonehasequalopportunity toparticipate indevelopmentprocess

andtoenjoythebenefitfromdevelopment;andtoensurethatnobodyisbeingleftout

fromdevelopment.

TheRights-BasedApproachinPracticeThissectionwilldiscusshowtheframeworkoftherightsbasedapproach incorporated

into development policies particularly with the reference of informal sector

developmentinurbanarea.Twocaseswillbepresentedandfollowedbythediscussion

ofthecasesusingtheframeworkoftherightsbasedapproach.

Surakarta

Asfacedbyotherbigcityauthorities,theSurakartaMunicipalgovernmentencounters

thesameproblemoftheboomingnumberofstreetvendorsfollowingthenationwide

economic crisis thathit the country in1997.Although informaleconomy,particularly

thestreetvendorsorpedagangkaki lima,hadbecamethesafetynetforthemassive

unemployment following the crisis, their existence also generates urban problems

particularly when they started to takeoverpublic spaces, such as streets,pedestrian

ways,parks,etc.,asfortheireconomicactivities[34].Duringtheperiodof20012005,

thenumberofstreetvendorsoperatingonmajorstreetsofSurakartarosesubstantially

fromabout1,100to5,817[35].Thissituationcallsforimmediategovernmentactionsto

prevent further problems. Learning from the social unrest in 1998, the Municipality

governmenttookamore innovativeandcommunicativeapproachtocontrolthestreet

vendors

through

its

revitalization

and

relocation

programs

[35].

In 2001, the Surakarta Municipality Government established Street Vendor

ManagementOffice(KantorPengelolaanPedagangKakiLima)[34].AccordingMorrellet

al.[35],principalfunctionsoftheofficearedatacollection,andconducting,evaluating,

and reporting on the strengthening and support program (pembinaan); organisation

andmanagement(penataan);andcontrolandrestrictions(penertiban).Someofwhich

aretherevitalizationandrelocationprogramsaimingtomanageandcontrolthestreet

vendorbring the informal traders into the formaleconomy indesignatedsellingareas

[35].

Wiyono [34] outlines that governments grand design for street vendor revitalization

and relocation programs comprise two main strategies: developing special location

designated for relocated traders; and designating special zones that open for street

vendors.Inthedesignatedareas,tradersareallowedtooperatebyprovidingthemwith

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permanentshelters,nonpermanenttents,collapsibleshelters;orpushcartsformobile

traders where any other options are unavailable [35]. In the relocation program of

traders tonewandexistingmarkets, thegovernmentprovidedanew trading location

equipped with permanent shelter; expanded and renovated the old building while

advisingtraders

to

improve

their

services,

cleanliness,

and

hygiene

[35].

OnenotablesuccessofSurakartaMunicipalitygovernment iswhentheysucceededto

relocateabout989informaltradersonJune6,2006,fromthehistoricsiteofBanjarsari

MonumenttoanewlocationinSemanggionagovernmentownedland.Therelocation

proceeded successfully without any resentment from the relocated traders. More

interestingly,therelocationprocesswasaccompaniedbyculturalmarch(kirabbudaya)

tocelebratethepeacefulprocessofrelocation[36].

Sjaifudian [37] identifies that the key to successofpeaceful relocationprocess is the

willingnessof

Surakarta

Municipality

government

to

take

amore

communicative

approach and have high level commitment toward consensusbased decision making

process.Theconsensuson the relocationprocesswasbuiltupona lengthyprocessof

communication. There were at least 54 informal meetings initiated by the Mayor to

develop mutual understanding between traders and the government [38]. The

governmenthasshownhighcommitmentforparticipatoryandtransparencyprocessof

decisionmaking.

The economic benefits from the relocation and revitalization of informal sector are

apparent.The informal traderswereassisted toparticipate in the formaleconomyas

thegovernmentprovidedtraderswithfreepermitscomprisingTradeBussinessPermit

Letter/Surat Izin Usaha Perdagangan (SIUP), Enterprise Register Mark/Tanda Daftar

Perusahaan (TDP); Designation Right Letter/SuratHak Penempatan (SHP); and Trader

Identification Card/Kartu Tanda Pengenal Pedagang (KTPP) [34]. These permits and

licenses provide formal protection over their status as formal traders. In return, the

governmentchargesthenewlyrelocatedtradersasmuchasRp.2,600,00($4cents)per

traderperday.Theresultwasthatthegovernmentrevenuefromtaxesandretribution

in this sector alone accounted Rp. 14,2 billions in 2008, far exceeding the revenue

acquiredfromhotels(Rp4billions)orterminalsactivities(Rp.3billions)[38].

Bandung

The Bandung Municipality Government also faces similar problem of the booming of

informaleconomysectorsas facedbyotherbigcities. Howeverthemagnitudeofthe

problem is fargreaterthanthoseexperiencedbytheSurakartaMunicipality.Referring

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tothesurveyconductedbySatpolPPin2004,streetvendorsweremainlyconcentrated

inanumberofareas,whichareBandungWetandanRegolareas(6.000traders),Andir

(2,912 traders), Kiaracondong (2,500 traders), Lengkong (930 traders), Cicendo (874

traders), Cibeunying Kidul (863 traders), Coblong (800 traders), Astana Anyar (500

traders),Sukajadi

(498

traders),

and

Bojongloa

Kaler

(485

traders)

[39].

However,

the

actualnumberofstreetvendors issubjected to fluctuationdue toseasonalvariations

[39].

Responding the issuesof informal traders,BandungMunicipalityGovernment takesa

morerepressiveapproach.Thegovernmentofficialsseestreetvendorsascityproblems

and only give social and financial burden to the government, undermining their

significant role in urban economy. Using Perda No. 11/2005 tentang Ketertiban,

Kebersihan, danKeindahan (Local Regulation No. 11/2005 onCity Order, Cleanliness,

andBeauty)asthelegitimacy,BandungMunicipalityGovernmentthroughSatuanPolisi

PamongPraja/SatpolPP(CivilPoliceUnit)hadlaunchedanumberofmeasurestogetrid

street vendors from various strategic locations. In order to back up Satpol PPs

operations,municipalitygovernmentallocatedabigsumofmoney. In2007,SatpolPP

receivedapproximatelyRp.4billionswhilein2008,itonlyreceivedRp.2.1billions[40].

The government assigned seven streetvendorfree zones covering areas inAlunalun

area, Dalem Kaum street, Dewi Sartika street, Oto Iskandardinata street, Merdeka

street, Kepatihan street, Jenderal Sudirman street, and Asia Afrika street. In these

streetvendorfreezones, theSatpolPPofficialsaredeployed topreventoreven take

necessaryactionstogetridstreetvendors.Motivatedbytheneedtoearnmoney,street

vendors are persistent to go to these zones although they bears the risk of being

arrested and losing their goods. This situation has resulted series of violence clashes

betweenSatpolPPofficersandstreetvendors.

A number of efforts to relocate the street vendors had been launched by the

governmentwithvaryingdegreeofsuccess.RelocationofstreetvendorsfromTegallega

Park toGedebageMarket, and fromKepatihanand Supratman street toCilaki street

havebeenregardedsuccessful,althoughsomedissatisfactionsamongrelocatedtraders

stillpersist[41].TheunsuccessfulrelocationofstreetvendorsaroundAlunalunareasto

theMasjid

Agung

underground

areas

was

due

to

the

lack

of

government

commitment

to

fulfilanyconditionalityagreedduringpreparationmeetings[42].

ThenegativesentimentstowardtheexistenceofstreetvendorsinBandungMunicipality

are not limited within government institutions. Some academics also raises their

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14

concern that Bandung society is virtually not benefitting from the presence of street

vendors and only receives negative excesses [43]. This is due to the fact that the

majorityofstreetvendorscomefromoutsideBandung.

Discussion

Thediscussionof the twocaseswillbe focusedon threeaspects.First, itwill identify

whathuman rightsare involvedandpossibleviolations. Itwillevaluate thedegreeof

governments obligations are fulfilled. It will also examine how development policy

actions contribute to promoting equity within the context or regional or urban

development.

Humanrightsinvolved

The two cases illustrate that government actions dealing with the informal economy

sectorinvolvetherightstowork,whichincludeseveryonetotheopportunitytogainhis

livingby

work

which

he

freely

chooses

or

accepts,

and

will

take

appropriate

steps

to

safeguardthisright,asstated intheArticle6point1oftheInternationalCovenanton

Economic,SocialandCulturalRights. Inpoint2,theCovenantoutlinesthestepstobe

takenbyaStatePartytoachievethefullrealizationoftherighttowork,whichinclude

technical and vocational guidance and training programs, policies and techniques to

achieve steady economic, social and cultural development and full and productive

employment under conditions safeguarding fundamental political and economic

freedomstotheindividual.

The covenant usually only provides a broad definition of the respective rights. The

specific interpretation may be referred to relevant General Comment. The available

relevantgeneral comment for the rights toworks (Artivel6of ICESCR) is theGeneral

CommentNo.18/24November2005.However the contentsof thegeneral comment

areirrelevanttobeusedasinternationalstandardoftherightsofworks inthecontext

ofinformalsectoractivities.

Therefore it is important to furtheranalyze informal streetvendingphenomenausing

basiccapabilitiesandentitlementframeworkasdiscussedearlier.Usingthisframework,

itisimperativetoacknowledgethatthosewhoworkininformaleconomyhaveahigher

degree

of

vulnerability

to

any

shocks

or

external

pressures,

which

may

cause

further

deprivation. Some studies suggest that the major source of vulnerability in informal

sectorsisitsinformalitynaturethatpreventsthepeoplewhoparticipateinittoaccess

keyassetstosustaintheirlivelihood[44,45].AccordingtoSoeharto[45],informalstreet

vendors, use space in the public spaces that are originally not designated for trading

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15

activities and it is also considered illegal. Due to their informality, the informal

worker/entrepreneurshardlyhaveaccesstofinancialresources,sincetheydonothave

assetstobeusedascollateralforapplyingcredit.Thestreetvendorarealsovulnerable

tophysicalabusesandexploitation[39,45].

Combiningthehumanrights instrumentdiscussedearlierandthevulnerabilityanalysis

of the informal sectoreconomy, the rights towork can be elaboratedas follow. The

rights toworks in informaleconomy sectors,particularly the informal streetvendors,

involvetherightstosecureaccesstospacefortheireconomicactivities;andtherights

tosecureaccessfinancialresources.

Assessmentofgovernmentsobligations

Within the rightsbased framework, the State is the principal dutybearer having

obligationsunderthe lawtoensurethattherightsoftherightsholderarebeingmet.

Stateobligations

cover

obligation

to

respect,

to

protect,

and

to

fulfill

the

rights

of

the

rightsholder.Thedetaildescriptionofgovernmentsobligationsontherightstoworkin

informalsectoreconomyiselaboratedinTable1.Tabel1 DescriptionofGovernmentObligationsontheRightstoWorkinInformalSector

Economy

GovernmentObligationHumanRightsInvolved

ToRespect ToProtect ToFulfillTherightstowork(Article6ICESCR)

The governmentshouldnottakeany

actions that may

interfere with the

enjoymentof rights

to works by those

who decide to gain

living in informal

sector economy

activities.

The governmentshould take any

necessaryactions to

preventviolationsof

therightstoworkin

informal sector

economy activities

byotherparties

The governmentshould take

appropriate

legislative,

administrative,

budgetary,judicial

and other

measurestowards

thefullrealization

of the rights to

work

ininformal

sectoreconomy

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16

Basedonthedescriptionofgovernmentsobligation intheTable1,theassessmentof

thegovernmentsobligationsbasedonthetwocasediselaboratedinTable2.Tabel2 AssessmentonGovernment'sObligationsontheRightstoWorkinInformal

SectorEconomy

GovernmentsObligationTherightstowork(Article6ICESCR) ToRespect ToProtect ToFulfill

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17


SurakartaMunicipalityGovernment

The governmentembarked

revitalization and

relocation of PKL

traders aiming to

restore city order

without

compromising their

rightstowork

The governmentestablished a

special office

having

responsibilities to

manage informal

tradingsector.

The governmentprovided the

newly relocated

traders

with

permits and

licenses that

would give

protections over

their existence in

thenewlocation

The governmentsecured informal

traders access to

spacebyproviding:

new trading areas fordesignated for

relocationprogram

designated informaltrading areas with

conditionality

attached

renovated marketareas.

The governmentcommitted to fulfill

anyagreementsmade

between government

and traders in the

relocation

project

such as: advertising

new trading location

in television in order

toattractvisitors.

The governmentsecuredtradersaccess

to financial resources

by providing legal

permits and licenses,

whichareessentialfor

applying credit

through banking

institution.

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18


BandungMunicipalityGovernment

The governmenttook a more

repressive policy

toward PKL traders

using Perda No.

11/2005 as the

legitimacyaimingto

restoreorderatthe

expense of the

rights to work in

informal sector

economy.

The governmenthas not

established

special institution

having

responsibilities to

take care

informal trading

affairs.

The governmentalso

did

not

take

any actions to

grant formal

recognition on

theirstatus.

The governmentdid not take any

necessary actions

to prevent any

exploitation and

physical abuses

received by the

informaltraders.

On contrary toproviding access to

space, the

government

designates seven

streetvendorfree

zones. Traders who

are found doing

trading activities in

these areas will be

arrested, and all their

goods

will

be

confiscated.

Basedon theassessmentof the twocases,SurakartaMunicipalityGovernmentshows

higherdegreeofcommitmenttofulfill itsobligationsontherightstowork in informal

sectoreconomycomparedtoitsBandungcounterpart.Itisimportanttounderstandthe

factorsthatmotivatethesetwogovernmentstotakedifferentapproachtowardstreet

vendors.Although,

Surakarta

Municipality

Government

did

not

intentionally

use

the

humanrightsframeworkwhentheystartedtherevitalizationsandrelocationprogram,

theprincipal factor lays in thegovernmentsphilosophywhendealingwith thepublic

affairs. The philosophical underpinning is the Nguwongke Uwong, a Javanese

philosophy that emphasis a more humane approach toward others and recognizes

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19

othersrightstobetreatedwithdignityashumanbeing.Thisphilosophyrequiresusing

amoreparticipatoryapproachandrecognizestheimportanceoftheviewsandvoicesof

the people [36].Theapproach takenby SurakartaMunicipality government coincides

withtheprinciplesofhumanrights.

Incontrast totheSurakartacase, theBandungMunicipalitygovernment takesamore

negative attitude towards street vendors. Even more, the government is found

ambiguouswhendealingwith the streetvendors. Informal streetvendingactivities in

Bandungisconsideredasrevenuecontributorbutalsoastheproblemforthecity[40].

Such ambiguities lead to unclear approach of government to resolve streetvending

issues.Thissituation isalsoexacerbatedbytheactionsofthestreetbureaucrats,who

exploit the street vendors by demanding unofficial contribution for personal benefit

[39].

Equity

Some scholars have proposed strategies to extend equity accompanying economic

growth.Timmer[8],withhisproposalforpropoorgrowth,advancesstrategytoextend

equity by improving the capabilities of the poor, lowering transactions costs in the

economy,especiallybetweenruralandurbanareas,and increasingdemand forgoods

andservicesproducedbythepoor (or for labordirectly).Thissuggeststhat,economic

growth shouldbeaccompaniedbymeasures thatwillensure that themajorityof the

populationisbenefitingfromtheeconomicgrowthitself.Thisiswheretheactiveroleof

thegovernmentisneeded.

Bothcities,

Surakarta

and

Bandung

are

growing

cities

propelled

by

the

industrial

and

tradesectors.Asthedutybearer,bothmunicipalitygovernmentshavetheobligations

totakeanymeasurestoensurethateveryonehasequalopportunitytotapthebenefits

from economic development. Therefore, appropriate policy measures are needed to

acceleratedistributionofwelfareacrosspopulation.Focusingattentiontowardinformal

sector economy is one important innovative policy option based on a number of

reasons.

First, the informal sector economy constitutes a substantial portion of labor market,

accounting 63.8% in 2005, 64.3% in 2006, and 65.4% in 2007 [39]. Therefore,

strengtheningtheinformalsectorsparticularlyinurbanareaswilleventuallycontributes

to reduce unemployment. Secondly, the informal sector has strong linkages with the

livelihood of the poor by providing affordable goods and services to these groups of

population.Thirdly,theeconomicbenefitof informalsectoreconomy isstilluntapped

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andwithproperpolicies,thissectorwillbeable tocontribute to regional revenue.As

shown inSurakartacase,thegovernmenthassucceededtogeneratemorerevenueas

the result of the proper management of informal sector. The additional revenue will

eventuallyprovideleveragetolocalgovernmenttoinvestinpublicspendingaimingfor

socialand

economic

development.

A

study

conducted

by

Muljarijadi

and

Thio

[46],

whichestimates theeconomicvaluation from the informalsectoractivity inBandung,

hintsanewprospectpolicyoptiontotaptheeconomicbenefitofthesector.

ConclusionThis paper shows that a high level of economic growth does not necessarily lead to

reduceddisparityacrossregionsandpopulations.Inmanycasesmarketfailstoworksas

themosteffectivemeanstopromotereducedimbalances.Thisiswheretheactiveroles

ofthestatearereinstatedtoreduceissuesofinterregionalandinterpersonaldisparity.

The rightsbasedapproachprovidesanalternativewayof thinking todeliverequity in

development. Itemphasis thatany measures takenby the government institutiondo

notviolate individualsrights tohaveequalopportunity toparticipate indevelopment

processandtotapthebenefitfromeconomicdevelopment.Thestoryoftwocitiesopen

up new possibilities for policy innovations derived from the humanrights principles.

Withinthehumanrightsframework,thefruitofeconomicdevelopmentshouldnotbe

enjoyed exclusively by those who work in formal sector, but to all people regardless

theirbackground.Withproperpolicymeasures,governmentinstitutionscanfulfilltheir

obligationsasthedutybearerwithoutbeingburdenedbysuchduty.TheSurakartacase

shows that they can earn more revenue from the informal trading sector without

compromisingtherightsofthestreetvendorstowork.

Thestreetbasedapproachcanbeappliedinmanydevelopmentsectorsthatinvolvethe

rightsof the rightholders,particularly those thatarecategorizedas social,economic,

andculturalrights.Inhealthsector,everyoneisentitledwithadequateaccesstohealth

services. The government should take policy measures to ensure adequate access in

termofphysicallyaccessible,economicallyaffordable,withacceptable levelofquality.

Some regional governments have developed a number of policies to fulfill their

obligationon

the

rights

to

health.

Dwicaksono

and

Nurman

[47]

review

anumber

of

policyinnovationintroducedbysevendistrictandmunicipalitygovernmentstoprovide

affordable and accessible health service for every citizen. In health sectors, some

regional government has launched free elementary education, a policy that coincide

withtherightstoeducationasstatedinICESCR.

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21

There are also some implications induced by the rightsbased approach to planning

practices.First,itrequiresplannerstoseekinnovativesolutionbeyondtheconventional

waystoaddressurbanandregionalproblems.Thetwocasesillustratethatplannersare

expected to seek innovative solutionbeyond the conventional view toaddressurban

andregional

problems.

As

the

case

of

informal

street

vendor

activities,

planners

should

see that theseactivitiesarepartof theurban lifeand thereforeneedequalattention

withthefocusofotherissues,for instanceonhowtodevelopgrowthcentersinurban

andregionalareas.

The approach also requires the planners to recognize the implications that may be

createdbythedevelopmentpolicyproposalsonanyindividualsrights.Asetofpolicies

thataredesigned for thebenefitof thewhole society,mayviolate individuals rights.

Thecaseof the roadblockadingbyathousandofclerics inCirebontoprotestthetoll

road construction project [48] is one example of such policy. Thepesantren (Islamic

boardingschool)isimpactedbythetollroadproject.Thepesantrenareawillbedivided

by the construction of new toll road. Although the project is designed with good

intention,however, itviolates the rightsofpeople toenjoy cultural life, the rights to

property,andtherightstofromforcedeviction.

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AcknowledgementI would like to thank my colleagues in Yayasan AKATIGA, who have kindly provided

importantmaterialsand research reporton the StudyofUrban InformalEconomy:A

CaseStudy

on

Street

Vendors

Activities

in

Bandung.

Iam

also

grateful

for

the

fruitful

discussionduringthedevelopmentofthispaper.

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23

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Documents

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