The U.K.'S LEP: A Model To Help Indonesia? [Part 1]
    Category: Issues & Ideas By : Scott Younger Read : 1094 Date : Tuesday, August 06, 2013 - 06:35:20

    The Master Plan for Acceleration and Expansion of Indonesia's Economic Development (MP3EI) has set out a bold framework for developing the archipelago, including a key role for regional governments and the private sector in this plan. Bold plans are fine—implementing them is another matter. Thus some thought needs to be given as to how this ambitious plan is going to be achieved.

    It is understood that regional development will only succeed with the drive coming from the regions themselves; a centralized focus would not be able to achieve the significant annual rates of growth required, nor as easily build the local support needed to get the project off the ground. While some regions are showing positive signs of improvement, in general much remains to be done.

    Just to recap, the MP3EI highlights 22 different economic areas, including education, human resources development, infrastructure, agriculture, mining, tourism and so on. Much attention has rightly been given to infrastructure since a large part of the performance of the regions is clearly related to their interconnectivity. In England the need for focusing on decentralized regional development was recognized several years ago, and in response Local Enterprise Partnerships (LEPs) were created. These LEPs have replaced the previous regime of regional development agencies (RDAs). The role of LEPs in fostering development in the U.K. might provide some useful lessons to Indonesia for its own development plans under the MP3EI.

    LEPs are interesting entities. They are voluntary partnerships between local governments and private businesses and were put forward by the central government in 2011. These LEPs help determine local economic priorities and lead growth and job creation within the given area of any particular local government. The central government by this move has clearly recognised that the private sector has a vital role to play in nationwide development and this view matches that of the objectives stated within the MP3EI.

    The U.K. government invited the formation of LEPs across the country and, from over 50 proposals received, accepted an intial batch of 24, which was announced in October 2010. This number has increased to 39 since September 2012. LEPs are catalysts, responding to needs and seeking to broker collaboration to create new jobs, support new businesses and sustain the growth of existing businesses. They must be seen as cogs in a bigger wheel comprising many partners responsible for innovation in a national and government context.

    An LEP has two charters—a planning and development charter, aimed at streamlining  the planning and development process, and a regulatory and business partnership charter, which is agreed upon by the local government and the business community of the LEP.

    A typical structure of an LEP, which is chaired by a private sector voluntary appointee, includes a number of local govenment representatives from the various jurisdictions within the LEP's geographic area as well as representatives of various business, professional, community and academic interests. Each LEP must identify its mission and set out in detail how its objectives might be achieved. Any decisions made by the LEP must include input from private and public sector viewpoints, and with due consultation from relevant boards, committees and of smaller community groups.