Discussion Notes

Strategic Asia Policy Interchange

“Education and Knowledge Sector”

The fifth Strategic Asia Policy Interchange, held on Thursday, 1. October, 2009, on ‘Education and Knowledge Sector’ featured Mr Scott Guggenheim (AusAid Social Policy Adviser) and Prof. Nizam (Secretary of the Board of Higher Education, Ministry of Education). The discussion was moderated by Mr Derry Habir, Associate Director of Strategic Asia Indonesia.

Mr Scott Guggenheim opened his presentation with explaining some key issues in the knowledge sector::

• Indonesian government needs to give more attention to the development of its knowledge sector in order to be able to improve the quality of the outputs which could be used for policy making purposes.  
• Despite the increased budget allocation for the education sector in the national spending and  ongoing civil service reform in education sector, some of the problems in the knowledge sector development remains, including: unstable financing base for the knowledge sector work by and within the government; existence of discouraging regulations for developing knowledge institutions; lack of grand strategy for knowledge sector development; low level of competition between knowledge institutions in Indonesia; gap between role and actual involvement of the research and development units in government institutions in the actual policy making
• As a part of its assistance to the government, AusAid plans to launch a long-term support program to revitalize the knowledge sector. The program will consist of the following:
  • Review of the knowledge sector development experiences in other countries, namely India, in order to learn the lessons from existing successes or failures.
  • Understanding the ways in which other middle income countries have solved their knowledge sectors’ problems.
  • Mapping of the institutional landscape of the Indonesian knowledge sector.
  • Analysis of the economic sustainability of the institutions.
  • Analysis of persisting regulatory problems and the way they should be changed.
  • In addition to extensive analysis, the program will also include consultations and capacity building in collaboration with private sector.

Prof. Nizam made the following observation:

The government’s mid-term strategy has emphasized that the education is a driving force to improve competitiveness. To do this, the following measures have been taken:

• Issues on the economic feasibility of educational institutions had been addressed by using the Law on BHP (Badan Hukum Pendidikan) that gives financial feasibility for those institutions.
• Provisions of incentives for the research works and the researchers
• Promote the to tailor-made models of education and technological development rather than total adoption of imported system

 Highlights of the Discussion

• Indonesia unfortunately has never properly documented the success stories of its domestically-breed programs as compared to foreign support programs. As a consequence, there are tendencies to seek external expertise rather than domestic ones in program design and policy formulations.
• To boost the knowledge sector development, there is also need for a paradigm shift in education field that puts much more emphasis on the end purpose of education, i.e. research as a basis to produce knowledge that can ultimately be utilized for welfare improvement. The concept of link and match between supply and demand side, or education and market ought to be much more seriously implemented.
• Development of the knowledge sector can not be isolated from the policy context/environment. In Indonesia case, several factors need to be considered:
  • The fact that neighboring countries are still redefining their positions
  • Policy options tend to be much more cross-sectoral and cross-boundarie
  • Gap between the knowledge sector and potential users such as political parties due to the lack of political platform.
• The Indian experience highlighted the policy context for knowledge sector’s growth. It happened at the time of reform where there was an open economy and subsidy reduction. Political willingness of the government to put great attention towards the knowledge sector is also an important starting point to begin the development.
• The government of Indonesia needs to have a white paper on knowledge sector development. This white paper should narrow down the main policy reforms that are needed to create a long term financing mechanism that could provide basic stability to knowledge institutions.

 Conclusions

• The success or failure of knowledge sector development will be determined by recognition by the government that knowledge sector development is an urgent necessity for the nation.
• It is necessary to establish an overall plan with a long-term vision for the development of knowledge sector in Indonesia, which encompassed the aspects of quality, supply, and demand.
• Grand strategy is an important instrument in developing the knowledge sector, but given the dynamic involved, greater public engagement and public dialogues are necessary.
• Link between knowledge development and critical thinking is quite significant. Therefore, measures to instill critical thinking method should be an integral part of basic education.