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Does Remuneration Improve Indonesia’s Civil Service Performance?


Ella Wargadinata
Institute of Home Affairs Governance (IPDN)
Jl. Raya Jatinangor Km. 20 Sumedang


There is a public anecdote that Indonesia’s Civil Service has low performance and also tends to abuse their power for their own benefit. This condition arose by bloat organization, low paid-salary system and un-professional its management. Though Indonesians agree that civil service should be reformed, unfortunately it was not executed comprehensively. Remuneration tried to replace a rigid Indonesia’s civil service payment system adopted on selected ministry choosing as a first step of civil service reformation in Indonesia recently. Salary adjustment viewed as a vital element which can improve civil service performance and also prevent government’s employee rent seeking from their work. However, remuneration it is only a small part of bureaucracy reform, salary increase was not the only way the bureaucracy reform could improve civil servants productivity and the government’s performance. The more important elements are to reform organization structure, business processes and human resources management. Salary adjustment was important as rewards for civil servants but not the key for the success of a comprehensive bureaucracy reform.   

Keywords: Civil Service Reform, Organization, Performance, Remuneration


This paper is analyzing existing Indonesia’s Civil Service performance post big bang reformation in year 2000. It endeavors to determine the cause factors and the system which should be adopted to pursue performance improvement in Indonesia’s civil service. Since the fall of new order-regime, the country has prioritized democratization, macroeconomic stability and growth. Indonesia has been dramatically transformed since then, from being a community in which an authoritarian regime severely constrained political expression and organization, in little over a year Indonesia became a vigorous multiparty democracy with a vibrant media and civic life. After fall of authoritarian administration in 2000, Indonesia emerged as ''democratic tiger'' that explained on how Indonesia move several steps to democratize their government. Elections become public routine agenda, at both the national and local level, embedding both choice and stirrings of direct accountability to their people for the first time. Not only brought new fresh air on politics but Indonesia also succeeded to exit from economic crisis in mid June 1997. Almost ten years after, Indonesia is enjoying its sixth straight year of economic expansion with growth in 2007 slated to reach 6.3 per cent, slightly above the average for the Association of South East Asian Nations six - Malaysia, Thailand, Philippines, Vietnam, Singapore and Indonesia. Those evidences indicate Indonesia is indeed moving along a steady reform path.

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Jun 16, 2011, 11:25 PM