Students demonstrate outside the Corruption Eradication Commission (KPK) building in Jakarta. Photo by Aprillio Akbar for Antara.

Fifty-one employees of the Corruption Eradication Commission (KPK) have been dismissed for failing a controversial national vision test – a screening mechanism with strong echoes of the New Order‘s tactics of control over state institutions. This will weaken the agency’s already-diminished ability to combat corruption.

Indeed, it may be the fatal blow. Despite the damage done by the revisions to the KPK law in 2019, up to this point, dedicated KPK investigators have still been able to expose major corruption scandals, including those involving high profile politicians. But with this purge of key investigators it looks like the KPK has been well and truly destroyed.

As depressing as it is, the destruction of KPK is not surprising. For all its commitment, high-profile arrests, and the many graft scandals it uncovered, corruption remains endemic in Indonesia. In fact, corrupt political and business elites are behind the gutting of the agency. This has been possible because of the way the administration of President Joko “Jokowi” Widodo has exploited identity politics and co-opted civil society.

The destruction of the KPK reveals the limits of institutional approaches in advancing democratic legal reform in Indonesia. As arguably the world’s strongest anti-corruption body, the KPK has failed not only to make any significant dent in corruption but also to defend itself from attacks launched by powerful alliances of corrupt political and business elites.

This suggests that corruption in Indonesia is much more than a moral, cultural or institutional problem. There is a political economy dimension that needs to be considered to understand why corruption is endemic and why institutional reforms will never be enough to address the problem.

A rent-seeking economy

Endemic corruption in Indonesia is intricately related to the way political-economic power is organised. It is a consequence of a rent-seeking economy where private wealth accumulation relies on access to, and control of, public institutions. This process fuses political and economic power.

Business actors need to build and maintain patronage relationships with the bureaucrats and government officials at local and national levels who issue the permits and licences that allow them to expand their businesses. At the same time, political actors require economic resources to help them win expensive election campaigns and maintain office in a corrupt system. The political power they gain is also essential for them to further plunder state resources with their business allies.

These predatory but symbiotic relations define the way public institutions work in Indonesia. Simply put, corruption is part of the way political and business alliances accumulate wealth and power, and keep it.

The limits of democratic legal reforms

Institutional reforms implemented in the years following the fall of the authoritarian New Order saw Indonesia’s score climb on international measures of the rule of law, such as the World Justice Project’s Rule of Law Index. But the destruction of KPK illustrates how legal reforms never really dismantled rent-seeking practices.

Reforms in the justice sector, such as amendments to the 1945 Constitution, increased judicial autonomy, and the establishment of new institutions like the KPK, were remarkable achievements. But these democratic reforms have done nothing to stem the deepening illiberalism that has occurred over recent years.

Political and business elites still have plenty of room to abuse and modify democratic institutions, and promote legal reforms to facilitate rent-seeking practices. There are always chances for them, formally and informally, to circumvent, challenge or reverse reforms.

Yes, incremental successes in the battle against corruption led to high hopes, but mega corruption scandals implicating high profile figures or involving massive financial losses have usually remained untouchable (such as the Bank Indonesia Liquidity Assistance or BLBI case).

Back in 2004, Lindsey warned that the governance paradigm used in the legal reform process in Indonesia “promotes overly simplistic approaches to the complex and political project of legal infrastructure reform”.

But many international donor-funded law and justice sector reform projects in Indonesia have been resolutely apolitical. They focus on institutions and policy and do not address political aspects or power structures.

Institutions do not operate in a vacuum. The way that they work is defined by constellations of power. This is why even a strong institution like the KPK remains prone to being hijacked by anti-democratic forces. There is little it can do about this now that the elite seem to have consolidated against it.

For example, under President Susilo Bambang Yudhoyono, the KPK was at times able to rely on the president to protect it from major attacks launched by corrupt politicians and the police. This usually only occurred after significant public pressure on the president to act. It helped that Yudhoyono was very concerned about presenting an image as a true democrat, especially in front of an international audience.

Under Jokowi, however, this approach has backfired. The president has the authority to appoint members of the selection committee that nominate potential KPK commissioners. This is the loophole that was exploited by elites to appoint questionable officials, like Firli Bahuri, as KPK chair, who has presided over its decline.

The KPK’s institutional design and powers are dependent on the KPK Law, which can be amended at will by the national legislature, the DPR, which now contains few pro-democracy forces. In other words, without powerful backers in the ruling elite, the KPK can do very little to protect itself.

Simply put, the recent destruction of the KPK illustrates the limits of an institutional approach to further democratic and legal reform. The KPK has failed not only to advance the anti-corruption agenda, but also to protect itself from infiltration by, and attacks from, anti-democratic forces.

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