The Indonesian Land Administration Project

While as much as 70 % of the construction in the 1970 s was initiated through government agencies, this balance has recently shifted to private sector in investments.

 Under the pressure of economic transformation a number of land - related problems have become more severe; not least being social conflicts and disputes over rights to land. Various measures by the government to improve its capability for land management and planing include The Land Administration Project ( ILAP ).

 Although the main focus of the project is land registration it doesn't mean that it is the only topic in the project. Practically every aspect of land matters will be dealt with in the project. It reinforces the need for technical change to be accompanied by change at the institutional and the community level.

 * The views and interpretations herein are those of the author and should not be attributed to the National Land Agency of Indonesia.

 GENERAL BACKGROUND 

Although Indonesia proclaimed its independence in 1945, it doesn't mean that we could start with national development immediately. Battles with the colonial troops occupying the country and the struggle to gain international recognition were just two examples of problem of high priority. We had to settle with the existing land laws of various origins, ie indigenous and colonial/western. After 350 years under some forms of colonial rule, land laws became a pluralism. Colonial rule introduced the western systems to meet the interests of colonial governments. The traditional unwritten laws based on the customs of various regions exist side by side with the land laws prevailing in the kingdoms scattered in the country.

 Indonesia is an archipelago of about 17,500 islands and islets with total land area of approximately 1.9 million square kilometers. One report said that the population will reach the figure of 200 million in February 1997. The five main islands are Sumatra (0.474 m.sq.kms), Java (0.132 m.sq.kms), Kalimantan (0.539 m.sq.kms)~ Sulawesi (0.189 m.sq.kms), and Irian Jaya (0.422.m.sq.kms). The land area is generally covered by the thick tropical rain forests. However, intensity of landuse is not even. Land in Indonesia is mostly under extensive rather than intensive use. More than half of the land area is covered with forests, but there is an uneven distribution of population. Approximately 60 % of the population is concentrated on the island of Java, which accounts for only 6.8 % of the total land area of the country. In recent years there has been an intensification in land use. This intensification has been roughly in line with the growth in population, which increased at an annual rate of 1.98 °/O between the 1980 census and the 1990 census.

Land classed as forest decreased in the period (2.6 million hectares), however this understates the actual rate of deforestation, which has been estimated at 1.3 million hectares per years.

 It was not until 1960 with the enactment of the Basic Agrarian Law (BAI~), the situation was ended. Two main features can be found in the BAL:

 The policy of "domeinverklaringD (Ujf it is not proven a land with a right, it is a state land") was revoked

The recognition of customary right as long as it is not in conflict with national interests.

In 1961 the government regulated the land registration based on the BAI~ and constitution. The BAL also includes the basic regulations of Land Reforrn, Landuse Planning and Land Granting.

 In general land status can be divided into two groups i.e. the state land and private land. Private land is either registered or not (yet), and state land is defined as land without any right attached to it. The common forms of land tenure are freehold, leasehold and rental agreement. Freehold can be obtained from transfer, granting of state land or "timprovement" from leasehold of state land. Leasehold can be obtained from transfer or granting of state land.

 Out of around - million parcels today, approximately 17 million have been registered since 1961. In 25 years it is estimated that the parcels will become around 78 million due to subdivision and "land-opening" (5).

 SYSTEM OF REGISTRATION

 Rights in land can be recorded in three systems: (a) private conveyancing; (b) the registration of deeds and (c) the registration of title. The first two of them are in existence in Indonesia. The first one, the private conveyancing, is not exactly regulated but based on customary law. The practice is legal, however it is an informal operation. It is originated in the customary society where such practice requires witnesses. The right is transferred at the time of payment, using the principle of" cash and clear.

 Private conveyancing happens when customary (unwritten) law governs the dealings. However if Umodern" registration is encouraged, the dealings can be registered together with the initial registration of the right. Being in the public register, the information about the ownership and subsequent dealings is made to be known to the public. The compilation of land records and the juridical processes that must be gone through in order to bring land information onto the registers should provide formal identification and legal proof of ~ ownership. The public registers should contain all essential juridical information allowing anyone viewing the

system to identify third - party rights as well as the name of the landowner (4). The absence of such public registers in the private coveyancing is the source of weakness of the system. Without a formal system to register rights an informal land market develops, and those who deal in an informal market are forced to operate in an environment of uncertainty. This discourages long term investment and can lead to the resource degradation and social unrest which is familiar throughout the developing world (1).

 The system that is formally adopted is the registration of deeds. A copy of all agreements that affect the ownership and possession of the land must be registered at the Land Office. As a result, by searching the registry for the most recent document of transfer, any would - be purchaser should feel confident that the vendor has the right to sell. Inspection of the register will show how the vendor obtained the property and the conditions under which it was acquired. This of course provides no proof that the previous transaction was legitimate, hence the transaction before that should be inspected and so on until the purchaser is confident that there is a clear chain of title (4). On its own the system gives no guarantee of title. The registration of deeds adopted is not an independent system of its own. The principle is to protect the real owner from the risk of wrong registration. It means that even after the registration, the real owner can still claim his/her ownership through court proceedings. If his/her claim is confirmed by the court, then the ownership in the register is changed accordingly. While such registries do not actually guarantee title, they provide the most important evidence of ownership that should be assumed to be correct unless proved otherwise in the court. The key factor here is the accuracy and the completeness of the documents including the proper map to show the boundaries (3). So the register is theoretically unchallenged if the name registered is the real owner, and the map can be used to reconstruct the original boundaries in the field dictated by mutual agreement between two adjoining title holders. In this system the registers are treated as primary evidence rather than definitive proof. The integrity of the system is sufficient for land owners to have full confidence in their rigths if the land data is accurate. The presence of however inaccurate data will weaken the system.

 THE PROJECT

 With GDP growing at an average rate of more than 6 % over the last 25 years, land use patterns are changing rapidly and this is expected to continue. Under the pressure of rapid economic growth and transformation, a number of land - related problems have become progressively more severe; not the least of these being social conflicts and disputes over land rights. Land-related issues in Indonesia have been receiving considerable attention in recent years, with a general perception that the many land problems seem to be becoming more serious and threatening. (7) Improvement in the land administration system will not solve or even address all these problems, but improvements in the land administration system and in the legal and regulatory systems that underpin it will provide the basis for addressing the perceived problems in a systematic and transparent way.

In 1991 in response to a request from the Government of Indonesia (GOD, a sector work titled "Indonesia: Land Resources Management and Planning n was produced by the World Bank. Based on that report which was received well, a project was prepared to address some of the important and impending issues concerning i management and planning of land resources. It was agreed between GOI and the Bank that the project which

could be the first in a series of the Bank projects designed to focus on land-related issues, would basically concentrate on improving land administration, especially the aspects of land titling/registration and the related institutional framework.

 The main objectives of the proposed project are to improve land administration and to give a legal security to land tenure in Indonesia, by facilitating emergence of emcient land markets and alleviating social conflicts over land rights, through acceleration of land titling and registration and increasing the effectiveness of the institutional framework. Another objective of the project is to support GOl's efforts to devise a long-term policy for land management through a series of studies and workshops.

 Project design has been undertaken within a definite set of constraints. These constraints are grouped under the following topics: project perspective; project areas; project targets; technology; Sustainability; funding.

 Project Perspective

 The project has been designed as the first five year phase in a planned twenty - five - year Program to improve the land administration system. A broad twenty - five - year Program has been prepared with the following goals:

to accelerate registration of rights in land and the issuance of land certificates, such that at the end of 25 years all eligible land holders have certificates;

to review land administration laws, regulations and procedures such that they serve the requirements of the society, are in a form that is able to be implemented by the National Land Agency (BPN), understandable and accepted by the public, in accord with Government policy, and flexible enough to respond in a timely manner to changed circumstances;

to strengthen BPN as an institution so that it is recognized as providing a valuable, cost effective service to Government and the public;

to have adopted a scale of fees that is high enough for BPN to be self-financing, and low enough that BPN services are available for all Indonesians;

to have BPN as an active participant in the on-going review of land administration aspect of Land Management Policy.

 

The Project has been designed to start addressing these goals in the first five years of the Program, so that the goals may be acheived at the earliest possible time.

 Project Areas

 Project areas are selected with the following considerations:

 Areas where improvements in land administration will have the greatest potential impact on the development of efficient land markets and the alleviation of social conflict over land rights.

Areas are selected on the basis of high predicted economic and population growth, areas where the potential economic benefits that derive from a more efficient land market are expected to be the greatest and where there is most social tensloft over land allocation and use.

Project design has been approached in a very pragmatic manner. It is recognized that there are considerable difficulties with the current system, substantial bureaucratic resistance to change, and a range of vested interests. In order to implement long - term change there is the need to demonstrate result quickly. Areas are selected where the environment, both within BPN and external to BPN, is most receptive to change.

Areas of uncertain jurisdiction are avoided. This particularly applies where definite policy guidelines are required.

The design endeavours to maximise the results of the pilot studies implemented by BPN and developing procedures to coordinate Land Office technology initiatives.

To prepare for subseqment phases of the twenty - five - year Program a number of smaller projects are included in the design. These include:
- project to assess optimal procedures and technology;
- projects to explore specific land registration issues that will be important in subsequent phases (communal customary land, boundaries of forest,etc);

 It is recognized that the first five - year phase will be a time when new techniques and technology will be ~ trialled and refined. Allowances have been made for a range of pilot studies. Targets are set on the basis of conservative estimates of production output around 1.2 million parcels of systematic registration, and 4,000,000 additional certificates from sporadic ( individual ) registration. Not all Land Offices are intended to conduct systematic registration. Those in the area with high percentage of registered parcels, if they meet other criteria, will get supports for sporadic activities to speed up the registration of the whole parcels. The design has also been undertaken so as to provide basic information and infrastructure to continue activities with minimal delays into the next phase of the program.

 Technology

The design emphasis appropriate technology. Equipment is appropriate when effectively and efficiently employed in the hands of trained personnel.

 Sustainability

The design incorporates proposals for the BPN to become a self - financed agency with the resultant flexibility to adequately reward staff and the ability to beffer fund on - going operations and institutional development.

 Funding

 The design assumed that a World Bank loan is successfully negotiated and accompanied by a bilateral program. Both were realized.

 The Project has three complimentary parts:

 PART A ACCELERATION OF LAND TITLING AND REGISTRATION

- Cadastral Base Mapping and Graphical Indices. - Systematic Land Titling and Registration.

- Sporadic Land Titling and Registration.

- Institutional Support for Land Titling and Registration.

- Improvement of the Legal Framework.

- Long - Term Development.

PART C DEVELOPMENT OF LAND MANAGEMENT POLICY

The AusAlD funded Technical ~ssistance program supporting a total of 18 international and 12 national advisers. The Project is being implemented by the National Land Agency, starting in 1994.

 In the first two years of the Project, two pilot projects have been undertaken to test the new methods, new process and new procedures, principally Systtematic Registration and the attendant procedures. The pilot projects were conducted in a range of urban, semi - urban and rural settings. The first pilot project covered an urban area of 1,200 parcels, and the second one covered approximately 5000 parcels. New methods and procedures introduced include:

 - The adjudication team visit the people, door to door instead of people going to the office in the routine process;

- Payment was collected after the certificate was submitted to the land owner instead of payment in advance.
- Written documents to prove ownership was not absolute requirement in the adjudication. The team will ask the applicant to make a sworn statement to beused as supporting evidence. Other written statements from witnesses and formal leader were obtained in the process.
- Low, uniform cost to the people. ( It is cheap because it is subsidised ). For land granting the overall cost to the applicant in about US$ 12 and for conversion of customary land right it is about half of it.
- The private sector were introduced into the project to undertake the cadastral survey. In the past, the private sector undertook the survey for establishing ground control points only.

At the moment, with the end of the pilot projects, the implementation of full - scale systematic registration has been started since June 1996. It was started with the training and deployment of 42 adjudication teams involving a total of 670 personnel. The number of teams will increase to 122 in Project Year 5, at which time 1950 people will need to be trained and mobilised.

 LESSONS

 Considered as ordinary project the Indonesian Land Administration Project ( ILAP ) is manned by officials having routine jobs. The size, the complexity and the new methods alone demand full - time attention. From the beginning the situation has been understood and anticipated. However, it was not easy to appoint full time personnel due to the fact that unless we can convince the related ministry, it is considered as ordinary project with usual appointment of personnel taken from the organization to be given additional task. To be exact, the size, coverage, complexity and time - span merit for the permanent structure in the organization. It has been proposed to the Ministry of Administrative Reform for consideration.

 Special teams are created for the project by mobilizing personnel from other land offices. It is a mobilisation of a large workforce for a long time averaging up to 10 months in the field each year. It must be done this way because of the zero growth policy of new personnel ( no additional recruits of personnel to the present total)and the limited capacity of the local Land Offices. The coordination, integration and leadership of the teams in one particular area of Land Office must be carefully arranged to avoid misunderstanding and confusion of integrating the documents into the local administration of the Land Office.

 The new methods need to be supported by amendment to the legal framework. Delegation of power and authority is required to speed up the process. The formalization of land rights requires the authority to adjudicate by ways of informal evidence such as occupation in good faith, statements of witnesses, rather than rigid documentation.

 The workload.will need delegation of authority to sign the certificate (delegated to the chairman of the adjudication team).

 In the overall life of the systematic registration an estimated 25 % of the total (+26,000 BPN staff will be deployed for the project. This requires a commitment of training and redeployment which is quite a problem new to BPN. With a figure of 78 million certificates to be completed in 25 years, and in the first five years it is planned only a little more than 5 million, it must be understood since the beginning that from this factor alone comes a major problem. Therefor lessons must be learned and a way must be found to meet the challenge in personnel mobilisation.

 The role of the Customer Relations and Services (CRS) component of the project cannot be overestimated. To be effective and efficient, in the systematic area, the registration must be compulsory. At least one case of rejection was found in the pilot project where one owner refused to participate because he thought it was too easy, too fast, too cheap compared with what he heard about the procedure and cost fo~ certification. On the other land if the active participation by the community in the project area is an important element in the process, the promotion program of the CRS can be a boomerang if it is heard some place else. One case of complain has been detected from a region outside the project area, where they questioned about the big disparity of the cost for land registration.

 The diversity of the participation of the private sector now needs careful attention. It is estimated that for the project it is impossible to rely on the availability of the government's surveyors. In the next 15 years over 1400 surveyors will be needed by the project, (1) Other than the need to establish extensive education and training program, the establishment of such industry requires legal basis for licensing the surveyors.

 Since the enactment of the BAL, land registration has been undertaken mostly on a sporadic basis, which is reliant on the process of registration being triggered by an application from an occupier of land. It has proved to be time consuming, expensive and inefficient to the extent that "independent u individual parcel mapping without cadastral survey will "float" the parcel to end up with the occurance of overlapping certificates. Theoretically, this situation can be rectified by the process of comprehensive system of graphical index mapping. However, in practice it is not that simple, simply because of difficulty in placing the individual parcel map ~n its relative position among other parcels in the project area.

 The integration of documents using the new methods into the existing system needs a careful attention revision of rules and regulations and skill. The new documents of the systematic adjudication are coming in huge bulk that need to be integrated systematically into the existing system. The need of change in the system to be more efficient is also an additional task of the project. Along the way, a new attitude is needed among the staff. In introducing technological innovations, the proper attitude is needed together with the sense of commitment. Computerisation must inevitably be applied to assist in meeting the changes and demands which will be felt in the land offices. An IT Strategic Plan will allow BPN to move beyond the current project - driven approach to computerisation (1).

 The problem of commitment is usually dismissed as non existence. Everyone will think that it is a built - in attitude on the part of government. The lesson here is that a commitment must be translated into actions, cooperation and communication to the extent of willingness to have an attitude of to give - and - take basis. Considering the long life of the project, two things should be considered.

 As a government's policy, there is a problem how to ensure that the project remains and is perceived to remain, relevant to the pursuit of that policy.

Policy and bureaucratic impatience can occur (1).

 CONCLUSIONS

No doubt ILAP is a challenge and the greatest one lies in the first five years. It is also conclusive that to eet that challenge, BPN needs all hands it can get, including sustainable government's support of political will and other commitment, physical and mental.