Budget Politics in Indonesia: A Case Study of the House of Representative's Optimization Fund

Muhammad Dimyati Sudja, Kumba Digdowiseiso, Banu Abdillah, Aditya Kusuma Rachman


This study explores the nature of public budgeting through a study of the interaction between formal political institutions and informal practices in the Indonesian budget arena after the 2014 General Election. The study draws on a collection of theories related to the role of political institutions in budget making and engages in theoretical debates in a field study of the key roles of politicians and parties in the Indonesian political system since the advent of democracy. Based on data collected through literature studies, this study examines legislative behavior in the budget-making process. Based on the case study, that the relationship between the legislature and political parties and the behavior of the executive government is influenced not only by the constitutional power of the President in the budget, but also by electoral rules that encourage legislators to prioritize access to patronage resources over party affiliation. In other words, the budget-making process is driven by a combination of the executive's need to advance its budget agenda in a multiparty presidential setting, in the absence of party direction and discipline, and the legislator's need to secure patronage resources. These findings offer new insights not only into the budget process but also into the workings of the Indonesian legislature. First, the case studies show that the presence or absence of a governing coalition is not the main determining factor in providing stability in the budget decision-making process. Second, they point out that, in the absence of an effective coalition, the use of constitutional budget-making powers to retain support from the legislature comes at a very high political cost. Third, this study reveals a form of cartel-like behavior among individuals, not parties, which challenges the application of cartel party theory in the Indonesian context.


budget; multiparty presidential; legislative–executive relations; patronage; indonesia

Full Text:



Ambardi, K. (2008). The Making of the Indonesian Multiparty System: A Cartelized Party System and its Origin. (Dissertation/Thesis), ProQuest, UMI Dissertations Publishing.

Angelia, N. (2020). Analysis of Community Institution Empowerment as a Village Government Partner in the Participative Development Process. Budapest International Research and Critics Institute-Journal (BIRCI-Journal) Vol 3 (2): 1352-1359.

Aspinall, E. (2013). Popular Agency and Interests in Indonesia's Democratic Transition and Consolidation. Indonesia, 96(1), 101-121.

Aspinall, E. (2014). Parliament and Patronage. Journal of Democracy, 25(4), 96-110.

Aspinall, E., & Klinken, V. (2010). The State and Illegality in Indonesia. Leiden: KITLV Press.

Audit Board of the Republic of Indonesia. (2015). Summary of Semester Examination Results (IHPS) I Year 2015.

Caiden, N., & Wildavsky, AB (1996). Planning and Budgeting in Poor Countries. New York: Wiley.

Chaisty, P., Cheeseman, N., & Power, T. (2015). The Coalitional Presidentialism Project: How MPs Understand Coalitional Politics in Presidential Systems, Research Report (Oxford: Oxford University, January 2015).

Chang, E. (2005). Electoral Incentives for Political Corruption under Open-List Proportional Representation. The Journal of Politics, 67(3), 716-730.

Crouch, H. (2010). Political Reform in Indonesia after Suharto. Singapore: ISEAS Publishing.

Dama, M., et.al. (2021). Implementation of Green Government by the Regional Government of East Kalimantan Province as a Form of Ecological Principles (Case Study of the Impact of the Implementation of Coal Mining Policy in Samarinda City). Budapest International Research and Critics Institute-Journal (BIRCI-Journal) Vol 4 (3): 4445-4457.

Farhan, Y. (2018). Thesis: The Politics of Budgeting in Indonesia, Australia: University of Sidney

Ford, M., & Pepinsky, TB (2013). Beyond Oligarchy? Critical Exchanges on Political Power and Material Inequality in Indonesia. Indonesia (96), 1-9.

Fozzard, A. (2001). The Basic Budgeting Problem: Approaches to Resource Allocation in the Public Sector and their Implications for Pro-poor Budgeting: Overseas Development Institute London.

Hadiz, VR, & Robison, R. (2013). The Political Economy of Oligarchy and the Reorganization of Power in Indonesia. Indonesia (96), 35-57,219-220.

Hallerberg, M., Scartascini, CG, & Stein, E. (2009). Who Decides the Budget?: a Political Economy Analysis of the Budget Process in Latin America. Cambridge, Mass: Harvard University David Rockefeller Center for Latin American Studies.

Hanan, D. (2012). Making Presidentialism Work: Legislative and Executive Interaction in Indonesian Democracy. (Dissertation/Thesis), ProQuest Dissertations Publishing.

Hawkesworth, I., Blöndal, R., & Choi, D. (2009). Budgeting in Indonesia. OECD Journal on

Budget, 9(2), 1-31

Hicken, A. (2011). Clientelism. Annual Review of Political Science, 14(1), 289-310.

Hilgers, T. (2011). Clientelism and Conceptual Stretching: Differentiating among Concepts and among Analytical Levels. Theory and Society, 40(5), 567-588.

Juwono, V., & Eckardt, S. (2008). Budget Accountability and Legislative Oversight in Transition: The Case of Post-Suharto Indonesia. In R. Stapenhurst, R. Pelizzo, D. Olson & L. Trapp (Eds.), Legislative Oversight and Budgeting. A World Perspective. (pp. 293-309). Washington DC: World Bank Institute.

Katadata. (2017). It turns out that the most private officials caught in corruption by the KPK. , from https://databoks.katadata.co.id/datapublish/2017/06/21/ternyata-pejabat-swasta-the most-many-tertangkap-korupsi-kpk

Katz, R., & Mair, P. (1995). Changing Models of Party Organization and Party Democracy: The Emergence of the Cartel Party. Party Politics, 1(1), 5-28.

Kawamura, K. (2013). President Restraint: Effects of Parliamentary Rule and Coalition Government on Indonesia's Presidentialism. In Y. Kasuya (Ed.), Presidents, Assemblies and Policy-making in Asia (pp. 156-193): Springer.

Liddle, W. (2013). Improving the Quality of Democracy in Indonesia: Toward a Theory of Action. Indonesia, 96(1), 59-80.

Liddle, W., & Mujani, S. (2006). Indonesia in 2005: A New Multiparty Presidential Democracy. Asian Survey, 46(1), 132-139.

Liddle, W., & Mujani, S. (2013). Indonesian Democracy: From Transition to Consolidation. In M. Kunkler & A. Stepan (Eds.), Democracy and Islam in Indonesia (pp. 24-50). New York: Columbia University Press.

Lienert, I. (2005). Who Controls the Budget: The Legislature or the Executive? Washington: International Monetary Fund.

Limongi, F., & Figueiredo, A. (2007). The Budget Process and Legislative Behavior: Individual Amendments, Support for the Executive, and Government Programs. World Political Science Review, 3(3).

Mainwaring, S. (1993). Presidentialism, Multipartism, and Democracy: The Difficult Combination. Comparative Political Studies, 26(2), 198-228.

Mainwaring, S., & Shugart, MS (1997). Presidentialism and Democracy in Latin America.

Cambridge; New York: Cambridge University Press.

McLeod, R. (2005). The Struggle to Regain Effective Government under Democracy in

Indonesia. Bulletin of Indonesian Economic Studies, 41(3), 367-386.

Mietzner, M. (2009). Indonesia in 2008: Democratic Consolidation in Suharto's Shadow.

Southeast Asian Affairs, 2009(1), 105-123.

Pereira, C., & Acosta, AM (2010). Policymaking in Multiparty Presidential Regimes: A Comparison between Brazil and Ecuador. Governance, 23(4), 641.

Pereira, C., & Mueller, B. (2004). The Cost of Governing: Strategic Behavior of the President and Legislators in Brazil's Budgetary Process. Comparative Political Studies, 37(7), 781-815.

Raile, ED, Pereira, C., & Power, TJ (2011). The Executive Toolbox: Building Legislative Support in a Multiparty Presidential Regime. Political Research Quarterly, 64(2), 323-334.

Robison, R., & Hadiz, VR (2004). Reorganizing Power in Indonesia: The Politics of Oligarchy in an Age of Markets (Vol. 3). New York: Routledge.

Rubin, I. (2010). The Politics of Public Budgeting: Getting and Spending, Borrowing and Balancing. Washington, DC: CQ Press

Santiso, C. (2005). Parliaments and Budgeting: Understanding the Politics of the Budget.

Available at SSRN 875858.

Sjahrir, BS, Kis-Katos, K., & Schulze, GG (2013). Political Budget cycles in Indonesia at the District Level. Economics Letters, 120(2), 342-345.

Slater, D. (2004). Indonesia's Accountability Trap: Party Cartels and Presidential Power after Democratic Transition. Indonesia (78), 61-92.

Slater, D. (2011). Proportional Presidentialism: Formal Rules and Informal Powersharing in Indonesia. Paper presented at the “Ruling Politics: The Formal and Informal Foundations of Institutional Reform”, Weatherhead Center for International Affairs. Harvard University.

Tomsa, D., & Ufen, A. (2013). Party Politics in Southeast Asia: Clientelism and Electoral Competition in Indonesia, Thailand and the Philippines (Vol. 55). Milton Park, Abingdon, Oxon; New York: Routledge.

Von Hagen, J. (2005). Political Economy of Fiscal Institutions: SFB/TR 15 Discussion Paper.

Wildavsky, AB (1974). The Politics of the Budgetary Process. Toronto: Little, Brown.

Winters, J.A. (2011). Oligarchy. Cambridge; New York: Cambridge University Press.

Winters, J.A. (2013). Oligarchy and Democracy in Indonesia. Indonesia (96), 11-33,220.

World Bank. (2007). Spending for Development: Making Most of Indonesia's New

Opportunities Indonesia Public Expenditure Review 2007. Jakarta: The World Bank Office Jakarta.

DOI: https://doi.org/10.33258/birci.v5i3.6621

Article Metrics

Abstract view : 42 times
PDF - 22 times


  • There are currently no refbacks.

Creative Commons License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.


Creative Commons License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.