Key features and accountability of public private partnerships in the context of Indonesian public asset management

  • Rohmat Rohmat

    Student thesis: Doctoral Thesis

    Abstract

    Limited financial resources have led many governments including Indonesia to find alternative ways to fund their development. Public Private Partnerships (PPP) offer governments substantial benefits by accessing the private sector’s funding, knowledge, and experiences. In regard to public asset management (PAM), PPPs are expected to address the problem of surplus assets. However, the involvement of the private sector through PPPs in public affairs sparks accountability questions.
    The research aims to explore PAM and PPP practices in a developing country using the concepts of governance and accountability. Compared to developed countries, few studies have been conducted in the context of developing countries. In the current literature, numerous studies explain PPPs yet only a few investigate PAM practices. Moreover, even less research discusses accountability concerns regarding PPP practices in the PAM context. The research answers the questions ‘How and why have PPPs been adopted in the Indonesian PAM context?’ and ‘What are the accountability challenges of PPPs in Indonesia’s PAM?’.
    The multiple case study approach underpins the research design. Four cases have been studied because of their diverse and influential criteria where semi structured interviews, government documentation and publicly available information are the sources of information. The information gathered is categorised and analysed to identify the emerging themes which are discussed further through the views of the current literature on PAM, PPPs and accountability in order to deliver the findings.
    The research presents the development and challenges of the Indonesian PAM. Despite its adoption of the principles of transparency and accountability, its PAM still suffers from the problem of surplus assets, asset security and flaws in current policies. PPP adoption is viewed as effectively addressing the surplus asset problem, yet the adoption faces the major difficulties of inflexible regulations and procedures and inappropriate organisational structures. Furthermore, accountability issues arise in many stages of PPP. The research argues that factors of risk allocation, cost benefit analysis and expertise are the factors which most influence accountability. There are also accountability problems in relation to compliance and transparency.
    The research contributes to knowledge in three ways. First, it extends the understanding of governance and NPM concepts at the national level of PAM practices in the developing world. Second, the focus at the project level on property-based PPPs, expands the discussion of asset-based PPPs by presenting the perspectives of different types of actors. Last, in the debate about accountability theory, the research proposes new evidence about the factors that influence accountability.
    With regard to policy and practice, the study advances three ideas to be discussed further. It proposes that the Indonesian government clearly reduce the impact of past unsound PAM practices, which has discouraged government officers from taking further actions in managing a large number of surplus assets illegally utilised by other parties. To address the problems of PPP adoption, regulations and policies need to be more flexible. Along with accountability and transparency, flexible policies are argued to foster the PPP adoption. Last, as dynamic attributes in both the government and private sector, the policies issued should encourage innovations. Measurement should be designed to promote innovative actions among government officers in managing public assets.
    Date of Award2020
    Original languageEnglish
    SupervisorJohn Halligan (Supervisor), Chris Aulich (Supervisor) & Harun Harun (Supervisor)

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