To fetch a pail of water ...

Suharto quit in 1998 after the South-East Asian economic meltdown and massive riots against his authoritarian regime. Now Indonesia has democracy and decentralisation. Of last year’s US$70 billion budget US$25 billion was distributed to provincial governments. The theory is that these administrations should know where the real problems lie - but that doesn’t mean they’ll be fixed.

For the 32 years of Soeharto’s rule the regions were denied any effective say in the nation’s affairs. They proposed projects that might or might not get the nod, according to the whims of bureaucrats in Jakarta and the political contacts of the provincial governor, usually a retired general.

The lack of “good governance” skills at the local level has led to aid donors, like Australia, funding training programs to teach officials how to handle budgets and make decisions. But the bureaucracy is a lumbering, clunking rundown machine, the result of Soeharto’s “disguised unemployment” policies of filling fictitious jobs.

Spending on government administration, excluding teachers and health professionals, saps almost 12 per cent of the budget. Similar countries allocate half this percentage.

Government desk jockeys are fearful of change: one study showed local administrations were taking nine months to frame annual budgets leaving only three months to quit the cash. Another factor making bureaucrats twitchy is the fear that if every piece of paperwork hasn’t been signed and stamped by a boss, they may be charged with corruption. At last count a massive 3.1 per cent of the GDP - that’s US$10 billion remained unspent.

In the past officials openly topped-up their meager salaries by taking a cut on projects. Deals with private contractors were inflated by up to 20 per cent with the surplus distributed to the pen pushers. This system, though now illegal, remains deeply entrenched.

So although Indonesia can now pay its bills the World Bank claims investment in infrastructure is only 3 per cent of GDP. This is half the expenditure recorded before Soeharto stepped down. Indonesia has now slipped way behind its neighbours, with a large number of its citizens unable to get basic services. Apart from the water problem, one third of the population doesn’t have access to electricity and most secondary and suburban roads would be better classified as goat tracks.

Past pro-poor programs have relied heavily on subsidies, though these are grossly inefficient and shoot wide of the mark. Although some fuel subsidies have been erased (the pump price of premium petrol is less than US$0.50), fiscal props still account for an outflow of US$12 billion a year. Most of this goes on electricity, which is good news for those with air conditioners and washing machines.

Indonesia, the world’s fourth most populous nation, is a signatory to the Millennium Development Goals, a worldwide bid to reduce poverty by 2015, with access to clean water a critical factor in improving health. So will a cashed-up Indonesia now seize what the World Bank calls “a unique opportunity” and ensure all its citizens get access to taps, even if the water has to be boiled before drinking?

Don’t bank on it. The 500 people interviewed for the World Bank report took the opportunity to bad-mouth public administrators, a right they dare not exercise during the Soeharto era when dissidents might vanish, the media was muzzled and anyone in a uniform had to be respected - and feared.

Commented report author Nilanjana Mukherjee: “I've seen some radical changes in the past few years and a lot more people in the bureaucracy are open to dialogue. I think the water problem may be fixed but I fear the sanitary issues may not be addressed. There are major environmental problems here and the government isn't doing a lot.”

Old habits die hard: according to citizens surveyed the attitude of many government officials is that poor equals stupidity. So there’s no need to explain policies or enlighten those at the bottom of the heap with information that might get them uppity. As the proverb goes, what you don’t know, you don’t miss. The water carriers will be in business for a while yet.