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Significancy of Empowering Entrepreneurial Management Capacity to reach Good Government Performance:

Gorontalo Experience

Fadel Muhammad, Governor of Gorontalo

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Local Government Issues & Problem

? Problem of Performance. Decentralization policy gives opportunity for local government to manage local affairs, few local government has abilities to achieve better performance than before. Unfortunately many local goverment face serious problem to improve their performance. In this case fairly measurement for local government performance is Human Development Index

? Corruption Movement. According BPK finding aproximatlely Rp 3,03 trilion local government revenue unrecorded in local budget. There are 44 local government spending not able to be tracked by BPK (Board of National Financial Controller). BPK found 7 case indicate corruption in local government financial management.

? Sense of Priority. Many local government neglect importance of public spending for education, health and economy inftastructures as human development investment. Unfortunately they prefer to build luxurious office complex, bigger spending on administration and office budget.

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Portrait of Development HDI in several Province as proxyLocal Government Performance

42.0265.764.4Sulawesi Barat

0.4468.13.8367.82.6765.363.6Sulawesi Selatan

1.5870.76.4269.665.4Bangka Belitung

0.8670.25.4569.63.296663.9Sumatera Selatan

1.7364.863.7Papua Barat

1.9762.11.3360.92.2160.158.8Papua

1.3368.81.9567.966.6Banten

1.1669.95.0269.11.8665.864.6Jawa Barat

3.2167.52.0365.464.1Gorontalo

1.0974.22.9573.46.2671.367.1Sulawesi Utara

Growth (%)2005

Grwoth (%)2004

Growth (%)20021999

Management Capacity and Performance: Comparison between mother Province and enhancement Province in HDI growth.

Gorontalo performed highest growth of HDI

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Towards Better Local Government Performance

What Have Been Done?

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Current Management

Capacity

Need Management

Capacity Capacity Gap

Reinventing Local Government through implementation of entrepreneurship management capacity Focus:

?Improving managerial capacityof bureaucrat

?Improving System Capacity

Locus?Human resources?Financial?Information technology

Gorontalo Province¡s Strategy on Reinventing Local Government

Introducing Entrepreneurship Government towards better local governance (indicated by HDI as proxy)

Source: Joint research conducted by UGM and Province of Gorontalo

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Entrepreneurship management

capacity

Macro environmental

Local Government Performance

Local endowment

Organization Culture

Influencing Factors toward Local Government Performance

Source: FM Model, adapted from PhDSource: FM Model, adapted from PhDDissertation, UGM 2007Dissertation, UGM 2007

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GrandStrategy

Sharpened Vision

Building Gorontalo to be a self-sufficient, productive, and religious province

Gorontalo, The Innovative Province VISION

MISSION

? Innovation on Entrepreneurship Governance

? Innovation on Human Resources Development

? Innovation on Rural-based People¡s Economy Development

? Innovation on Appropriate Technology

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ORGANIZATION

CULTURE

STRUCTURERightsizing

Less governresponsive

TowardPeople needs and

problem

Democratic

Professional

Responsive

Bureaucracy Reform on Structure and Culture towards Smart Government

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OFFICE

The merge of Revenue Office and Financial Board, two similar-functioned units.

GENERAL BUREAU

FINANCIAL BUREAU

GOVERNOR (CEO)/VICE GOVERNOR

(VICE CEO)PROVINCIAL

SECRETARIAT asCOO

SECRETARIATE ASSISTANT OF DEVELOPMENT

REVENUE OFFICE

FINANCIAL BOARD as CFO

SECRETARIATE ASSISTANT OF

PUBLIC SERVICE

MERGER

.

SECRETARIATE OF LOCAL ASSEMBLY

BOARD

Also applied toAnother board orAgency such as personnelBoard, etc

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Fiscal Decentralization Practise and Red Tape Reduction

G

W

S

K

D

G

W

S

K

G

W

S

K

A A

SPP FLOW SPM FLOW CHEQUE FLOW

Year of 2002

Before Fiscal Decentralization

Keterangan :

D

K

A

S

W

G

=Agency/Board

=Board of Finance

= Assistant

= Province Secretary

= Vice Governor

=Governor

Financial bureaucracy passing¡14 desk¡ before 2002

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Fiscal Decentralization Practise (continue¡ .)

After Fiscal Decentralization

Keterangan :

D

K

A

S

W

Q

=Agency/Board

=Financial Board

= Assistant

= Province Secretary

=Vice Governor

=Financial SectionSKPD

Almost 18 Local Government Unit (SKPD) implementing red tape reduction, money disbursement only passing 2 desk. 8 SKPD on going reform process. (effective 2007).

W

S

K

D

K

K

A

SPP FLOW SPM FLOW CHEQUE FLOW

Year of 2006

QIII

CUT THE RED TAPE AND MAKING CHECK AND BALANCE

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Civil Service Reforms? Mind setting short course for the highest

to lowest level officers? Rewards system: The introduction of

TKD (Regional Performance Benefit) aimed to distribute project bonuses in a more transparent and equal manner

? Punishment for those not complying with the regulations

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Breakthrough for Development

? Bureaucracy Reform through entrepreneurship government. Introducing 5 Working Values: innovation, teamwork, prosperity, society trust, speed

? Focus on Three Programs:1. Human Resources Development 2. Agriculture (Maize Economy)3. Marine and Fisheries (11 Models of Coastal

Economy Development).? Limited Government Intervention? Continuous Innovation to raise people¡s living

standard

? Partnership and networking

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Optimizing Achievement Performance rather than

Action Performance

OUTCOMES

Sources: Research on Governance Assessment, Developing a Diagnostic Tool and it¡s Application for Governance Reforms in Gorontalo Province (2006)

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Performance Indicator for Good Local Governance

Gorontalo Province relatively good at

? Ensuring peoples¡ political right ? More access to local policy formulation

? Delivering Public services? Good at maintaining local access to public service

? Combating Corruption? People¡s statisfaction with follow-up actions in combating

corruption? Enacting good local regulation

? More local low ensuring investment climate, public participation, etc¡

? Law enforcement? Fairness in law enforcement

? Sustaining political stabilization? No significant horizontal conflict

Source; Government Assessment Survey 2006

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REWARDS FOR THE INNOVATIVE PROVINCE

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