INTERREGIONAL COOPERATION BASED ON SOUND

GOVERNANCE PERSPECTIVE
Tjahjanulin Domai
Faculty of Administration Science, University of Brawijaya Malang
Abstract : The recent decentralization and local autonomy policies in Indonesia
has brought some implications such as the changing pattern of the relationship
between the governmental levels and the greater authority on the local
government, as well as the opening of the opportunity for the local to do
interregional cooperation. However, Farazmand observes some barriers against
this cooperation involving: untrustworthy, power domination, excessive
expectation, political and cultural environment, religion, ethnic and racial.
Keywords: Decentralization, Intergovernmental Relations and Sound
Governance.

INTRODUCTION
1. Interregional Cooperation
In the period of local autonomy and decentralization, interregional
cooperation shows a significant development in Indonesia. Many
cooperation institutions are formed as a response to the changing pattern
of the relationship between government levels and also to the greater
authority on the local government due to the implication of the
implementation of decentralization policy in Indonesia (Pratikno, et.al.,
2007).
Such change opens the road for the local government to cooperate
either with other local government or non-state actor.
In other side, decentralization gives a new challenge and
opportunity in the local realm. The local may be difficult to respond it
effectively without a reliable cooperation (Pratikno, et.al, 2007). For
example, the economic development opportunities, among other tourism,
in certain region may not be effectively managed if it should be selfoperated. Often, it triggers a new conflict in the interregional context.
Supporting Pratikno et.al (2007), Paterson (2008) admits that many
recent local governments have looked for a new method to reduce the
expense, to maintain the service quality, to review the service system, to
determine the priority, and to establish which service is given through
alternative channels.

The alternatives of the service delivery that might be used by local

government may include: contract with the private company, voluntary
organization, or environment group; franchise; subsidy to the direct
service user; the use of donated labor; the determination of users charge
to cover service cost; and the negotiation of intergovernmental cooperative
agreement.
Paterson (2008) says that intergovernmental cooperation is a
manner used by one government or more to achieve mutual goal, service
delivery, or problem solving. The example of such cooperation may range
from informal action and/or information or equipment exchange; the
interest for mutual service delivery or mutual projects to manage water,
trash, waste, and drainage, throughout formal arrangement, such as the
strict legal agreement. Survey at New York State Department in 1981 and
1982 shows the presence of formal and informal cooperative relations with
other government.
Interregional cooperation for development and resource usage is
attempted to reduce interregional gap, to control conflict, to improve
service, to empower the community, and to increase efficiency and
effectiveness of resource usage, in order to produce a compatible
development which is balancing the tenure, role, and function, but still to
consider democracy principles and to integrate the diversity of each
potential into one integral management (Tasmaya, 2007).
Some literatures mention that cooperation has different degree,
which is ranging from coordination throughout the highest degree,
collaboration (Thomson, 2001; Thomson and Ferry, 2006). Basically,
there is expert opinion that the difference of this degree remains in the
depth of integration, interaction, and complexity. Cooperation is in the
lowest rank, while collaboration is in the highest rank (Keban, 2007).
Ramses and Bowo (2007) assert that in essence, cooperation
indicates the dynamic interaction between two parties or more to achieve a
mutual goal. This definition contains three main substances which are
producing a mutual framework. These are two parties or more, interaction,

and mutual goal. If one substance is eliminated, the cooperation is

considered as absent.
Two parties always describe a group of interests which are
influencing and interacting to each other to achieve mutual goal. If the
relation or interaction is not for meeting each partys interest, this relation
is not cooperation. A dynamic interaction is not directly meant as
cooperation. An interaction to meet the interest of one party, and at the
same time, to abandon the interest of other party, cannot be called as
cooperation. Indeed, cooperation always put the interacting parties in the
balancing and harmonic position. The cooperation is only achieved by
giving mutual benefits to the participant. If just one party is a loser in the
cooperation, the meaning of cooperation is failed. In pursuing for the
mutual benefits in the cooperation, good communication between the
participants and the shared understanding for mutual goal are needed.
Other reasons for interregional cooperation are as follows:
1. The cooperated parties can establish greater power. In the
interregional cooperation, the power of each cooperated region can
be synergized in dealing with threat or problem which is difficult
to be self-handled. By cooperating, the possibility of dealing with
environmental barrier or obtaining productivity is higher.
2. The cooperated parties may achieve higher progression. By
cooperating, each region will transfer the capability, skill, and
information. Thus, one region can learn the strength or capability of
other. Indeed, each region will try to progress or develop itself
based on the mutual learning.
3. The cooperated parties can be more empowered. By cooperating,
each region will have better bargaining position, or more capability
to defend the interest in the higher level of government structure. If
a region should struggle for its self-interest, its voice may be easily
neglected. If a region chooses to be a member of a forum of
regional cooperation, its voice may be considerable.

4. The cooperated parties can minimize or prevent the conflict. By

cooperating, regions which are previously competing to each other
or having a conflict can be more tolerant and trying to take a lesson
of the conflict.
5. Each party feels sense of justice. Each region feels to be
benefited because there is a transparency. Each region in the
cooperation has similar access to any information made or used.
6. Each cooperated parties will need sustainability of the matters
which are cooperated. By cooperating, each region will have a
commitment to not betray the partner, but to keep up the
sustainability of mutual relationship.
7. The cooperation can eliminate regional ego. By cooperating,
regional ego may be avoided, and vision of collectivity as a
nation must grow (Keban, 2007).
Moreover, Hamdi (2007) adds that: First, each region in the development
level must understand that the benefit of the cooperation network is
important to improve the regional progression. Second, the cooperation is
developed voluntarily and representing a demand of mutual reliance or
interregional

interdependence.

Therefore,

in

developing

shared-

understanding and a willingness to cooperate for sustainable learning and

for capacity building, the leadership of national government is needed to
motivate local government to cooperate, mainly by some instruments such
as policy and national regulation.
Ramses and Bowo (2007) declare that the cooperation between
autonomous local governments in all levels with other institution is an
important policy due to the following reasons:
1. The execution of public service affair across autonomous regions
can be effective and efficient if it can be mutually synergized
between the autonomous regions. The certain public service aspects
may be optimized through integrative implementation by the
bordered regions.

2. The optimum solution toward the collective problems related to

space order, traffic and transportation, trash management, water
supply, and the preservation of river basin, is only settled through
cooperation. The cause-and-effect relationship between the space
use, population mobility, and its implication, is creating collective
problems which are required for collective solution.
Considering the complexity and the extension of democratization and
transparency demands, thus the cooperation between autonomous regions
is urgent in order to create more effective, efficient and responsive
governmental implementation upon the demand of around autonomous
regions.
2. The Type of Interregional Cooperation
Theoretically, the term of cooperation has been long known and
conceptualized as a source of efficiency and service quality (Rosen quoted
in Keban, 2007). Cooperation is recognized as a precise way to take
benefit from economies of scale. Collective expending or purchasing, for
example, may illustrate this benefit taking process. Purchasing in greater
scale or beyond threshold points will more benefiting than buying in
smaller scale. By cooperating, overhead cost is controlled despite its small
scale. Sharing in investment, for instance, may give more satisfying final
result in the activities such as the provisioning of facility and equipment,
or the appointment of specialist and administrator. The cooperation also
increases service quality, especially in the provisioning of facility and
equipment when each party cannot buy alone. By cooperating, the
expensive service facilities are possible to be bought and enjoyed
collectively, such as recreation center, adult education, and transportation.
Interregional cooperation, therefore, is a form of arranging the cooperation
between local governments in the predetermined fields to achieve better
efficiency and service quality.
Historically,

interregional

cooperation

mechanism

has

been

becoming an important issue in the developed countries (Henry quoted in

Keban, 2007). It is starting with very limited fields such as police and fire
departments, in which one city and other have an agreement to help each
other in dealing crises such as fire and other disaster. In advance, this
cooperation mechanism is not only applied into emergency situation, but
also into an arrangement to buy some services from private company or
other government, or even from NGO. Early cooperative agreement
made by local governments is (1) designed for single activity, (2) serviceoriented than facility-oriented, (3) not permanently, (4) being as standby-provision which is implemented in certain cases, and (5) requiring
permission from legislative.
The type and method of the cooperation between local governments
include: (1) Intergovernmental Service Contract, (2) Joint Service
Agreement, and (3) Intergovernmental Service Transfer (Henry, 1995). The
first cooperation type is made if a region pays other region to implement
certain service such as prison, trash management, animal or livestock
control, or tax estimation. The second type of cooperation is usually found
to implement the functions of planning, budgeting, and service delivery to
the local community, such as regional library, communication between
police and fire departments, control over fire, and trash management. The
third type represents a permanent transfer of a responsibility from a region
to other region concerning with fields such as general work, structure and
infrastructure, health and welfare, government and public finance.
Meanwhile, other opinion says that the cooperation between local
governments can be found in two formats, which are forms of agreement
and forms of arrangement (Rosen quoted in Keban, 2007). The forms of
agreement are distinguished as follows:
a. Handshake Agreements, which is a cooperation arrangement
without written document.
b. Written Agreements, which is a cooperation arrangement with
written document.
Handshake Agreements represent a form of agreement which is easily
subjected to conflict and misunderstanding. Written Agreements are

usually required for contract, collective ownership, or the work to build a

mutual service unit. Anything mentioned in the written agreements involve
any conditions of cooperation and self-withdrawal, cost sharing, location,
maintenance, schedule, operation and the rule of collective resource
ownership, rent condition, and conflict solving method.
Rosen quoted in Keban (2007) adds that forms of arrangement of
the cooperation consist of the following:
a. Constantia, which is a cooperation arrangement in the resource
sharing because it is more expensive to be self-paid. The example is
library. It has books and other services which are used together by
student and public. It will be expensive to build the library for each
party.
b. Joint Purchasing, which is a cooperation arrangement to buy goods
in order to save the cost when buying in greater scale.
c. Equipment Sharing, which is a cooperation arrangement in sharing
expensive equipment, or those not daily used.
d. Cooperative Construction, which is a cooperation arrangement in
constructing buildings like recreation center, library, parking lot,
performance hall, and others.
e. Joint Services, which is a cooperation arrangement in providing
public service, such as one-roof service center which is collectively
owned where each party sends its officer to work in this center.
f. Contract Services, which is a cooperation arrangement where a
party contracts other party in order to deliver certain services, such
as drink water service, trash management, and others. Such
arrangement is easily made and easily terminated, or easily
transferred to other party.
However, the reality shows that type and method of cooperation are often
troubled in its implementation (Rosen, 1993). Each region may have
different jurisdiction, and therefore, each must be difficult to arrange the
resource schedule and the charge of the cost. In turn, a friction or conflict
is easily found. It is often occurred because one region feels overcharged,

while the other feels lack of service than is deserved. The community is
also suffered if the service location is centralized (combined) because
transport cost may be higher than if the service location is self-provided.
In addition to transport problem, the community feels isolated as served
by new parties.
Centralized purchasing through joint purchasing cannot escape from
critic. Standardization of goods bought is often problematic because a
region feels that goods bought is already based on its standard of interest,
while other region denies it. Indeed, it is always difficult to meet the
interest of each cooperated party (Rosen, 1993).
In the developing countries, the cooperation between local
governments is seen in the development planning activity, such as
Integrated Area Planning (IAP). It is a breakthrough to solve the
complicated problems when this cannot be solved by a development
planning based on administrative region borders. It must be admitted that
recent interregional cooperation may not appear as a demand. However,
some problems or internal decisions made by a Regency or City, or
Province, are always related to the problems or decision beyond its
regional border. The reality indicates many problems faced by a Regency
or City, or Province exactly emerge because of policy made by other
region concerning matters such as trash, criminality, demographic,
education, and health. In short, a planning or policy which is made by a
Regency or City, or also Province, often disregards its impact of other
Regency/City or Province. In such, the function of integrative planning
and horizontal coordination is the main key.
The introduction of integrated area planning model is expected
to reduce some conflicts among administrative regions, by making
effective the development at certain sectors and institutions that are
subjected to conflict (regardless the administrative region borders). This
model comes up as a reaction to the weakness in the sector planning, the
coordination between sectors, and the satisfaction of the demand of each
special

geographic

area

(possibly

not

aligned

with

the

existing

administrative region borders), such as river basin (DAS) and rural

development which is then called integrated rural development.
Though this model is very reliable in the past, there is important
barrier to be considered somehow. This barrier is related to the structure
(organization)

which

is

designed

to

manage

integrated

rural

development. This structure is a formal structure established based on the

existing political and administrative units, such as officials and technical
agencies from each Regency/City or Province. However, this formal
structure is not planned to deal with such issue. As a result, this model is
lack of support from formal authority, meaning that the model is also
difficult to implement and hard to be succeed.
Exit gates that are ever offered are (1) establishing a structure
representing a length of arm of the central government in the related area,
or a structure made by the local government or private company with
special status; (2) founding a planning consultant team from outside the
area to only concern about planning; and (3) reforming the existing
organizational structure and improving the staff capability in preparing
and implementing the plan, and strengthening the horizontal relationship
between sectors and also weakening vertical relationship.
3. Interregional Cooperation Policy in the Normative Review
Interregional cooperation is formally enforced in the legal term by
Law No.22 of 1999 on The Local Government with Article 87 verse (1)
saying that some regions can develop interregional cooperation as
collectively decided, (2) regions can form an interregional cooperation
agency, (3) regions can develop cooperation with other agency as
collectively decided, and (4) collective decision and/or cooperation
agency, as mentioned in verse (1), (2), (3) and (4) which is burdening the
community and region, must be acknowledged by House of Representative
of each region.
Indeed, Article 88 verse (1) says that regions can develop a mutual
cooperation with institution/agency out of country, as collectively decided,

except in matter related to governmental authority, as mentioned in Article

7 verse (2) on Order of Conduct.
The opportunity of cooperation is opened when Law No.22 of 1999
is replaced by Law No.32 of 2004 through its Article 195 verse (1) stating
that to improve the community welfare, region can cooperate with other
region based on the consideration of efficiency and effectiveness of public
service, synergy, and mutualism.
Next, Article 196 determines the importance of cooperation in the
public service. Verse (1) states that the implementation of governmental
affair which is affecting the interregional area will be arranged together by
related regions. Verse (2) says that to create efficiency, regions are
supposed to deliver public service collectively with the other around
regions for public interest. Verse (3) says that for the management of
cooperation as mentioned in verse (1) and verse (2), regions form
cooperation agency. Verse (4) states that if the regions cannot implement
cooperation as mentioned in verse (1) and (2), the public service will be
implemented by government.
The cooperation policy is enforced by the Government Regulation
No.50 of 2007 on the order of conduct for the local cooperation.
Especially, in the Article 4, public service is a set of services given to the
public by the government, such as administrative, superior sector
development, the delivery of goods and services, the provision of hospital,
market, clean water management, housing, parking lot and trash
management.
Local cooperation, therefore, represents a structure to optimize the
interregional relationship and interdependence, to compare with local
development, to synergize interregional potential, and to improve the
exchange of knowledge, technology and information.
Through local cooperation, it is expected to reduce local gap in
giving public services, especially in remote area, interregional borders,
and disadvantaged region.

The object which can be cooperated may be some affairs related to

the authority of autonomous region, local asset, and local potential, as
well as public service delivery. The implementation of cooperation must
concentrate into the principles of efficiency, effectiveness, synergy,
mutualism, sharing agreement, virtue, equality, transparency, justice, and
law certainty. Indeed, cooperation object is a main factor to consider in
implementing cooperation, thus allowing the determination of type of
cooperation.
For instance, in realizing the development harmony based on the
interregional growth rate in the urban area of Yogyakarta, and in
anticipating the problems occurred in Bantul Regency, Sleman Regency
and Yogyakarta City, the cooperation is required for the management of
urban structure and infrastructure. Thus, the follow-up measure taken by
Bantul Regent, Sleman Regent and Yogyakarta Mayor is a Joint Decree
No.18/2001, No.01/PK-KDH/2001, and No.01/2001, on the cooperation of
the management of urban structure and infrastructure between Bantul
Regency, Sleman Regency, and Yogyakarta City.
Basically, these regulations have similar and complementing
principles. Interregional cooperation will improve public welfare based on
the efficiency and effectiveness of public service, the synchronization of
activity program, a synergy, and mutualism, in order to deal with the
regional collective problems.
4. The Implementation of Interregional Cooperation Policy based on
Empirical Review
The interregional cooperation policy is divided into cooperation
with the bordered region and cooperation with distant region. Review of
interregional cooperation with the bordered region is concentrating on the
problem solving and the anticipation of border problem, and optimizing
and increasing the efficiency of the use of local resource and fund.
Cooperation made by the government of Yogyakarta City, Sleman
Regency and Bantul Regency is an activity to deal with the urban

agglomeration problems such as road, clean water, waste water,

transportation, trash, and drainage. The cooperation of these regions is
expected to improve the efficiency and effectiveness of mutual interest,
precisely related to the management of Yogyakarta City.
According to Suryakusumo (2008), the limitation of each region is
a chance for the cooperation with other region. Each region can take
greater benefit from cooperation rather than its self-action. Interregional
cooperation will be operated if there are two or more regions interacted for
mutual goal, in the equal position, in harmonic balance, and willing to
settle into memorandum of understanding.
In fact, interregional cooperation is successful in some regions.
Indeed, in this cooperation, every problem must be mutually solved.
Therefore, each local government can synergize its development concept.
Interregional Cooperation Agency has been established in some
regions. The authority may differ because its establishment is based on
memorandum of understanding made in each region. For example is
BKAD at Banjarnegara, Banyumas, Purbalingga, Cilacap and Kebumen.
Interregional

cooperation

agency

is

also

established

at

Boyolali,

Sukoharjo, Karanganayer, Wonogiri, Sragen and Klaten Regencies. This

Agency is named by Regional Economic Development, which is founded
from the cooperation of Indonesia government and German government.
Provincial interregional cooperation is found at Pacitan Regency
(East Java), Wonogiri (Middle Java), and Gunung Kidul (Yogyakarta
Privileged Region), which is named by Pawonsari. The cooperation
between Surabaya City and Sidoarjo Regency is called as Su-Si. Similar
cooperation is also evident between Bogor City and St.Louis City of
United States. The international cooperation seems already settled between
Yogyakarta and Hue City of Vietnam in Thua Thein Hue Province.
Provincial based cooperation has also been created by Riau Island, Bangka
Belitung, Riau and West Kalimantan Provinces.
Taking these into account, it seems consistent with sound
governance dimensions proposed by Farazmand (2004). The process

dimension explains the interaction of stakeholders in the cooperation. The

structure dimension explains how the governance is managed. The term
structure defines a direction for the process.
Sound Governance has a solid, legitimate, competent and dynamic
structure either in the format and substance. The constitution dimension is
a fundamental guiding document, being as blue print for governance while
the constitution

is

source of legitimacy. The organizational

and

institutional dimension explains that institution without clearly defined

organization is brittle and suffered from destruction. Organization without
institution is also weak and less resistant. Therefore, this dimension
becomes an integral component for sound governance. Furthermore,
management and performance dimension is equaled to a kind of glue or a
systemic transmission with the expected result. Management must be
supported by knowledge, technology, capacity, resource and skill. Policy
dimension gives a guide to the institution and organization of governance
in pursuing for the expected goal and target. Awareness and value
dimension represents a distinctive value system which is irregular in the
governance structure/process. For example, a governance system which is
poor, corrupt and not healthy always relies on the external power,
complexity, diversity, and low intensity. Sound governance has healthy
and dynamic values such as justice, equality and integrity. Ethic,
accountability and transparency dimension is an important thing for sound
governance. The implementation ethic can prevent the misled of power
and the corruption, thus preventing bureaucracy from only concerning
with economic and administrative affairs. Bureaucracy works for the
effectiveness and efficiency, and has public orientation. Sector dimension
of the governance is important because it is specific sectors, including
industry, education, health, and transportation. Therefore, this dimension
requires direct participation of the community, reliable management, and
reliable knowledge and skill.

Interregional cooperation is a response to such complexity. Indeed,

a comprehensive framework should be made by involving any related
parties.
Interregional cooperation must be based on mutual interest.
Therefore, interregional cooperation should in the nature of participative
and flexible to produce a consensus. This consensus is failed if it is
without recognition of equality, volunteering, and autonomy of each
related party. Thereby, interregional cooperation is a kind of interregional
horizontal relationship.
The value of interregional cooperation based on Old Public
Administration is different from the values of New Public Management
and

Sound

Governance.

In

this

Old

Public Administration-based

interregional cooperation, the relation pattern is hierarchic, seeing a forum

of cooperation organization as a coherent unit with clear goal, with
process structured from the top, being oriented toward certain goal, and its
decision making dominated by the central as the single actor.
Interregional cooperation based on New Public Management is
more concerning with interregional relationship which is each region is
free,

flexible

and

self-support.

In

this

interregional

relationship,

hierarchical and centralized authority is absent. New Public Managementbased interregional cooperation seems underscoring the performance
indicator as a measure of interregional cooperation to obtain the economic,
efficient and effective value.
Interregional cooperation based on Sound Governance involves four
actors and ten dimensions. These four actors develop an inclusiveness of
political relationship between country, community, business world, and
international power.
In the interregional cooperation context, these four actors interact
to each other in the position of equality, self-support, mutualism, and
participative, which is supported by dimensions of process, structure,
awareness and value, constitution, organization and institution, and

management and performance, policy, sector, globalization, and ethic,

accountability and transparency.
Sound
Governance

Old Public
Administration

New Public
Management

The above figure is showing a relationship between three concepts.

Sound Governance is containing with more critical and dynamic thoughts.
More clear about these concepts is shown in the table:
Table 1. The Difference of The Characteristic of Old Public
Administration, New Public Management and Sound Governance
Old Public Administration
Hierarchic

New Public Management

Free relationship

Sound Governance
Equal

Clear goal

Flexible

Self-Support

Central-based decision

Self-support

Mutualism

Government as singular

Less

Participative

Democratic

actor

hierarchic

authority

Efficient,

economic

and effective

5. Some Problems in the Implementation of Interregional Cooperation

The cooperation between local governments must be seen as an
irresistible demand. Peterson (2008) admits that intergovernmental
cooperation is settled to search for a new method to relieve expense
burden, to ensure the service quality, to determine the priority, and to
establish

which

service

given

through

cooperation.

Furthermore,

intergovernmental cooperation is an order of conduct used between two

governments or more in pursuing for mutual goal, service delivery or
problem solving. The example of this cooperation may be informal action
during joint information or equipment, or formal arrangement, including a
legal agreement. For instance, the municipal officers in New York have

wider authority to make intergovernmental agreement. Early government

may implement the function or service individually, but now it should be
collectively operated.
Intergovernmental cooperation is a significant step. Different
situation can stimulate cooperation. Some considerations of government in
agreeing for cooperation are as follows:
(1) Economies of scale, in which some services given by government
accelerate the achievement of economies of scale when the cost of
recent service unit increases with the greater volume of service.
Such service is a chance for cooperation. The example is public
work, liquid waste management, capital facility, clean water, and
trash dumping. The cost of these units is usually reduced to obtain
the optimum cost.
(2) Unevenly distribution of natural resources such as land, clean
water, transportation, road and drainage. These resources are
needed by the government to meet the public interest. The example
is clean water supply and end point of trash dumping.
(3) Development activity and service delivery by local government for
the public interest cannot be constrained by administrative region.
The example is drainage, trash dumping, road, transportation,
health service, and education. It will require the cooperation
between the bordered local governments.
In the cooperation between local governments, a dominant consideration is
building

consensus

between

related

actors.

Therefore,

flexible

cooperation is required to open chance of change and adjustment during

the implementation of cooperation. However, some barriers constrain the
implementation of cooperation, such as:
(1) The regional ego is very salient during the cooperation between
local governments.
(2) Untrustworthiness between actors of cooperation.
(3) Resource gap among the cooperated local governments.

(4) A dominance of a region against other region in the decision

making about the cooperated sector.
(5) Different vision-mission among local governments.
These problems are also found by Farazmand (2004) in Sound
Governance. There are also barriers against the implementation of
cooperation, such as:
(1) Untrustworthiness is a main barrier against the cooperation of
actors.
(2) Power structure is globally dominant, thus forcing the partner to be
submissive.
(3) Too high expectation for the successful cooperation.
(4) Environmental

condition

of

actors

which

is

suffered

from

ideological, political and cultural effects.

(5) Religion and culture issues may obstruct intergovernmental
cooperation.
(6) Ethnic and racial issues can also hidden the implementation of
intergovernmental cooperation.
6. The Cooperation between Local Governments as a Choice of Policy
The question of the model used by a country or a local government
to solve the collective problem is related to the choice of policy. Problem
solving through cooperation is susceptible to weakness, ineffectiveness,
inefficiency, and failure. It can be measured from the appropriateness of
the policy chosen by exploring the deeply the policy realm. Among ten
dimensions of Sound Governance, one dimension is policy, which is
important to provide clear guide, direction and control to the process,
structure and management dimensions. One policy may come from
external of governance organization, which is usually from legislative
authority. Such policy guides and directs the institution and organization
of governance to pursue for the expected goal and target. Second type of
policy is that internal to organization and institution of governance. Such
policy is an organizational policy or a manual which is defining and

determining the rule of conduct, regulation, procedure and values

considered to achieve the performance, mission and goal of the
organization of Sound Governance. Both external and internal policies
become a controlling mechanism for the performance of the organization
of Sound Governance. The higher participation of citizen in the
policymaking means higher credibility and legitimacy of governance
system.
The cooperation between local governments as a choice of policy
will face local governments onto certain problem. Local governments may
not ready to deal with the problem, thus not using the cooperation between
local governments as the problem solving.
Intergovernmental relationship remains as a conceptual pillar due to
the presence of promise. If the choice of policy is appropriate, local
government will play key role to implement local government system for
the internal or external public welfare. Thus, the cooperation between
local governments should be planned in integration.
Some experts disagree with the definition of intergovernmental
relationship. Websters Dictionary determines that:
Intergovernmental relationship is an existence or emergence of
cooperation or collective actions between two governments or
levels of government.
To understand the intergovernmental relationship, Wahab (2009) explains
a model of local governments in cooperating to each other. This model is
described as follows:
1.

The Coordinate Authority Model

It is characterized by:
a.

Federal/central and local governments have equal

authority.

b.

Federal/central
autonomous authority.

and

local

governments

have

c.

The strict line between central and local authorities,

in which each region cannot intervene.

d.

Local, city, regency, and provincial governments

follow an unitary system.

Critics against The Coordinate Authority Model are:

a. There is no strict line between central and local authorities, thus
absolute power can be enjoyed either by central or local.
b. Power channeling in this system doesnt have clear direction
whether from central to local or from provincial to regions,
although the superior government has authority given by the laws of
local government.
2.

The Inclusive Authority Model

It is characterized by:
a.

Central and local governments are affected by

decision made by political actors in the national level, and also
affected by national economic interests.

b.

The authority of institutions outside national agency

such as Governor and member of Local House of Representative is
so limited. For instance, United States applies such pattern where
the political system is arranged hierarchically by central. The
growing opportunity for cooperation is almost ensured in the central
and local levels (state-province-local). The combination of province
and local has equaled to budget demanded by central.

3.

The Overlapping Authority Model

It is characterized by:
a.

The power is widely distributed such that each

government level reduces its dependency to each other.

b.

High

synergy

is

produced

for

each

central,

provincial and district governments, with its autonomous region and

its exclusivity in the central, provincial, and district governments.

c.

The

cooperation

between

governments

or

governmental environments is developed in the competitive or

cooperative realm.
4.

Federal and State with Autonomous Region

It is characterized by:
a.

The objective of federal government is egalitarian

and universal.

b.

The objective of local government is particularistic,

which is specific only the region.

The

base

of

relationship

between

central,

provincial

and

local

governments is as follows:
1. The central government is the keeper of money.
2. The central government needs human resource and organization
resource, thus giving the money to the supplying government in
turn for the resources.
3. Provincial and district governments have human and organization
resources, thus requiring money to manage it.
Through any model perspectives, it is shown that intergovernmental
relationship is a form of policy. To understand the intergovernmental
relationship, we must understand the distinctive marker behind the success
and failure after the implementation of policy.
Intergovernmental

relationship

concept

may

understood

as

partnership concept, as suggested by Hetifah (2009). Partnership is a

new perspective, representing an elaboration of governance. Partnership is
needed to increase the support of public and private sectors in building a
communication path. Local government considers partnership because it
supposes to use the limited resource. Many program of communication
cannot be developed alone either by the government or the non-profit

organization. Developing the communication path may be more effective

through cooperation.
According to Wahab (2009), partnership needs high commitment to
manage the change to empower the position of related parties. For
example, in the partnership, each party should obey the provisions stated
in Law No.32/2004 on Local Government, or submissive to the
Memorandum of Understanding. This memorandum usually explains the
role and responsibility of each party. The cooperation between local
governments may be difficult to formulate, thus increasing the possibility
of distortion or failure in the decision making process or during the
agreement of decision making procedure. In other word, Memorandum of
Understanding and other procedure of negotiation must be rationalized and
understood appropriately by each local government to prevent the useless
management of resource or service delivery to the public, or to avoid from
low quality or unsatisfying outcome. Regularly consistent evaluation
should be conducted over the role and responsibility of each party. It is
important to ensure the transparency the cooperated governments. This
evaluation can involve the public input.
The expectation of lay person and policy marker onto the problems
is solved through cooperation. Decision making is thus facilitated to
achieve goal efficiently and effectively.
There are some examples of Governance Network which is flexible
and proactive with its real impact on public policy making. The problem,
however, is that Governance Network involves social and political
processes which are occurred in the uncontrolled political and economical
context. In reality, some barriers obstruct the effective Governance
Network: (1) it is difficult to motivate actor into the participation due to
high transaction cost and small opportunity for an actor to obtain real
political influence; (2) it is not possible to solve the internal conflict in the
network for mutual solution; (3) the creation of self-supported Governance
Network is difficult due to the minimized legitimacy and resource; (4) the
governmental failure in understanding the Governance Network procedure

or the political resistance from the actor of Governance Network; and (5)
different perceptions between Government Network and Governance
Network.
These problems are contrasted to Farazmand (2004) who is
explaining it from the process dimension in Sound Governance. It is said
that Sound Governance involves a governmental process, where all
elements or stakeholders are interacted. A process, therefore, can explain
how the governance works. Above problems are contrasted to the structure
dimension. This dimension is consisting for a group of element, actor,
regulation, procedure, and constitutive decision making frame. Sound
Governance has a solid structure which is enriched by information,
legitimized, competent, and dynamic in any forms or substances. In Public
Governance, the officers can be selected and appointed, and the
stakeholders and community self-support organization are part of
governmental structure.
Formulating and implementing the satisfying solution for unclearly
defined and complex policy will be need: (1) the participation of all
relevant and influential factors in the network negotiation; (2) the actor to
collect the resource; and (3) the actor to agree for the conception of
problem nature, option diversity, and rational of the most important
decision making. There is no guarantee that all these demands are met. In
reality, a set of barriers need to be dealt before producing a problem
solving which is compatible to Governance Network.
The participation of actors may be constrained by the closure nature
of Governance Network. Schapp and Van Twist (1997) quoted in Sorensen
and Torfing assert that there are four type of closure where one actor
disregards other actor. First, there is an unawareness of social closure if
the rule, norm and procedure are regulating access to Governance Network
by disregarding certain actor. Second, social closure is evident if the
network actors recognize that some relevant actors are disregarded. Third,
there is an unawareness of cognitive closure, meaning that in the
discursive network actor context, the other actor may be disregarded in the

negotiation of Governance Network.

Finally, cognitive closure may be

recognized if the network actor is considering the exclusion effect of the

reference, but is not willing to change it for the further participation into
Governance Network.
It is aligned with Farazmand (2004) for the cognition and value
dimension where the cognition and value are representing the distinctive
or irregular value system in the structure and process of governance. For
instance, a governance system which is poor, corrupt and not healthy
always relies on the external power, complexity, diversity, and low
intensity. However, Sound Governance has healthy and dynamic values
such as justice, equality and integrity.
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