The Role of Central and Local Agencies in Indonesia's Road Project Delivery System

Abstract

The policy regarding the management of national road networks in Indonesia has been centrally programmed and managed by the Directorate General Bina Marga, under the Ministry of Public Works. Under such policy, the national road and bridge system is planned, programmed and financed by the central government, whereas the implementation of construction and rehabilitation/maintenance of roads and bridges are delegated to local authorities. In exercising its authority, the government of Indonesia has relied on traditional design-bid-build approach for delivery of road and highway construction and maintenance projects. Under this approach, program development and engineering were prepared by the central agency (DGBM) whereas the biding and construction process will be carried out by local authorities at provincial level. This paper discusses result of preliminary study on alternative delivery method for road projects in Indonesia. The study attempts to identify the potential application of design-build delivery method, as well as performance based contract to the current management structure of national road network system. In particular, this study aims at investigating the impact of organizational structure and decentralization mechanism at both central and local authorities to current state of application of traditional design-bid-build delivery method in road construction projects.