Indonesia: Institutional Capacity and Regulatory Analysis of BLUD in Tahura Sult
Based in Seoul, the Global Green Growth Institute (GGGI) is an intergovernmental organization founded to support and promote a model of economic growth known as green growth, which targets key aspects of economic performance such as poverty reduction, job creation, social inclusion, and environmental sustainability. GGGI works with countries around the world, building their capacity and working collaboratively on green growth policies that can impact the lives of millions. The organization partners with countries, multilateral institutions, government bodies, and private sector to help build economies that grow strongly and are more efficient and sustainable in the use of natural resources, less carbon intensive, and more resilient to climate change.
OBJECTIVES OF THE ASSIGNMENT
As a part of its overall program in Indonesia, and to support Government of South Kalimantan's mission, GGGI is supporting the South Kalimantan Provincial government through the Forestry Agency to assess the potential of utilizing Payments for Environmental Services in their areas of jurisdictions - in the Tahura (Taman Hutan Raya) Sultan Adam and Waduk Riam Kanan – to enable sustainable management of conservation areas that provide critical environmental services. This activity is also included as one of the Phase III Green Growth Program (GGP3) joint work plan with the Ministry of Environment and Forestry (KLHK).
Currently, within the conservation area of Tahura Sultan Adam, there are thirteen (13) definitive villages whose increasing population is heavily dependent on the Tahura land for their economic activities. Also, because of many environmentally degrading activities such as logging, mining, fishing, farming, grazing activities (some of which are not- legal), the state of some areas within the Tahura Sultan Adam and surrounding the Riam Kanan Reservoir has reached a critical stage. To address these problems and prevent further damage to the environment, there have been efforts to improve the quality and quantity of the land cover in the Tahura Sultan Adam, such as the UPT Reforestation Riam Kanan through the Right Riam Reforestation Inpres Project until the 1980s, Balai Rehabilitasi Lahan dan Konservasi Tanah through Project Overseas Economic Cooperation Fund, etc. However, many challenges present in the area are yet to be resolved, which could potentially impact Riam Kanan Reservoir's ability to maintain a desirable level and quality of water services.
Therefore, as a part of the effort to address the challenges, in 2021, GGGI has collaborated with the Forestry Agency of South Kalimantan to work on the scoping study to analyze and determine the potential for utilizing a PES scheme in Tahura Sultan Adam and Riam Kanan Reservoir. The study aimed to build a sustainable model that supports the provincial government's commitment to South Kalimantan in increasing the capacity for rehabilitation and conservation activities with a contribution scheme that is fair and beneficial for all stakeholders involved. This study mapped out and assessed the relevant stakeholders and land-use activities in and around the Tahura Sultan Adam area and Riam Kanan Reservoir. Additionally, the study evaluated the potential uses of economic instruments, including Payment for Environmental Services (PES), Ecological-based Fiscal Transfer (EFT), and other relevant instruments to protect the upper watershed area and the conservation forest.
The scoping study concluded different potential funding schemes are possible, as follows:Water conservation partnership with co-financing from multiple stakeholders in the landscape Individual Cooperation from stakeholders (e.g., CSR funds)
In addition to the above, when the scoping study was being conducted, there were changes in the UPTD Tahura Sultan Adam that has transformed its status to BLUD (Regional Public Service Agency) based on the Governor's Decree 188.44 of 2021. UPTD has the potential to be the intermediary of the scheme, especially as providers’ coordinator and in making agreements with water user companies on behalf of the providers. We also propose UPTD to take on the role of finance vehicle, where the contribution given by the water user companies are being managed and disbursed to potential providers. With UPTD’s status change, it means that as a BLUD, it will be able to receive and manage funds from different sources such as the private sector, grants, and loans—or in other words, exercise its potential role of pool, manage, and disburse contributions for watershed and forest conservation.However, information gaps remain, especially on assessing the possible institutional framework and mechanisms for BLUD, e.g. including aspects of management, financial set-up, and legality of BLUD, that need to be analyzed to realize a sustainable financing mechanism for Tahura that is effective and efficient. More information also needs to be collected regarding the responsibilities and mandates of provincial agencies in relation to maintaining Riam Kanan watershed.
Hence, GGGI will mobilize one (1) individual consultant on a deliverable contract basis to conduct a study on the Institutional capacity and regulatory analysis of BLUD, to identify the readiness and capacity of key government institutions (e.g. UPTD) to manage and operate such a funding mechanism to support sustainable management at Tahura.
SCOPE OF WORK AND EXPECTED OUTPUTSRelated to operations: Review and analyse the institutional arrangement, financial setup, and legal basis of BLUD. This includes a review of national regulations related to BLUD, issued by Ministry of Finance and Ministry of Home Affairs. Assessment of Tahura UPTD BLUD's potential in expanding its operation into acting as a financial vehicle for a public-private partnership for conservation and sustainable management in Tahura. Review of other BLUD practices with similar characteristics to UPTD Tahura Sultan Adam.
Related to division of responsibility in Riam Kanan watershed maintenance: Developing a matrix of mandates and responsibilities of stakeholders identified in the scoping study as well as newly identified stakeholders, if any. Proposing a governance scheme that potentially aligns with the sustainable financing mechanism for Tahura SA
Related to source of revenue: Identification of existing funding sources from APBN, APBD, Private Sector, TAPE/TAKE and others for sustainable management of conservation areas. Assessment of how different funding sources highlighted above can align to and could contribute to the BLUD funding mechanism. Identifying the challenges and critical aspects of establishing BLUD as a sustainable funding mechanism, such as governance, the efficiency of revenue collection and financial management, overall business model, etc.
Developing an actionable roadmap for using BLUD (or other institution) as the sustainable financing mechanism for implementing economic instruments in Tahura Sultan Adam.
For this task, the Consultant will work with:Dinas Kehutanan Kalimantan Selatan GGGI Outcome 2 Team (the Investment Team) for coordination and technical assistance
Tasks and Approach:Conduct an intensive discussion with:
- The office of Tahura Management, the Forestry Agency, the office of SK Province Regional Secretary and other stakeholders involved in the BLUD process for Tahura Sultan Adam
- Engagement with local university (ULM) and Technical Implementation Unit of MoEF based in South Kalimantan (e.g. BKSDA, BPDAS, Balitbang Banjarbaru, etc.)
- Conduct stakeholders' engagement and coordination with MOEF (Ditjen KSDAE and PDLKWS), Kemendagri (organizational structure and financial management of BLUD) and MOF (related to the financial management of BLUD)SWOT analysis of BLUD mechanism as a funding mechanism for conservation areas in Tahura Sultan Adam Analyze the institutional framework and financial management of BLUD within the government's regulations, specifically in using such institutions for the implementation of economic instruments in the Tahura Sultan Adam area. Identify of potential funding sources of BLUD (APBN, APBD, Private Sector, etc.) and channeling mechanisms Analyze the feasibility for BLUD UPTD Tahura Sultan Adam in taking on the role of finance vehicle (collection, management, and disbursement of funds), intermediary, and community coordinators in the implementation of watershed and forest conservation partnership (a hybrid PES scheme). This includes but not limited to capacity and capability of governing and managing fund, how to set a separate account from the BLUD core business, operation cost in taking expected roles, potential constraints in increasing funding availability and funding disbursement. Identification of additional funding sources that can be channelled through the BLUD mechanism to increase capacity in institutional arrangement, local communities' livelihood, and strengthen infrastructure for conservation area management. Provide policy recommendations for BLU/BLUD development and operationalization for the watershed and forest conservation partnership in Tahura Sultan Adam Provide recommendations on the management and financial set-up of BLUD Tahura Sultan Adam for watershed and forest conservation partnership in Tahura Sultan Adam
Due to the evolving COVID-19 pandemic, the meetings will be conducted in hybrid (offline and virtually), unless there is an internal policy change taken by provincial/district government or GGGI or both.
Any communication by the Consultants to other external partners must be approved by GGGI.
DELIVERABLES AND PAYMENT SCHEDULE
The Individual Consultant is required to submit countersigned Coversheet Form in which Work Completion section was signed by the service requestor as the deliverable of each service.
Submission of workplan and timeline for the initial processes
27 May 2022
Review and analysis on the financial management, institutional arrangement, and legal basis of BLUD, with comparative case study from other parts of Indonesia
3 June 2022
Focus Group Discussion (FGD) on the role of BLUD Tahura Sultan Adam - to identify the readiness and capacity of key government institution (e.g. UPTD) to manage and operate the multistakeholder forum/conservation fund
24 June 2022
Draft report on the BLUD analysis
29 July 2022
26 August 2022
The Consultants may also be required to produce additional output(s) as deemed reasonably necessary by GGGI.
GGGI will enter a contract for the delivery of the work set out in the Terms of Reference.
QUALIFICATIONS AND EXPERTISE REQUIRED
The skills and experience required of the adviser should include inter alia:
At least a master's degree related to environmental conservation, economics, public policy, or other relevant degree from a reputable local or overseas universities
Years of Experience:Track record of at least 5 years of experience with forest management units, forest conservation projects and use of economic instruments for environmental sectors in Indonesia. Experience with sustainable forest management, prevention of forest degradation, payment environmental services, watershed restoration and restoration projects in Indonesia (can be over multiple engagements, please provide evidence of project completed with the stakeholders mentioned above). Strong knowledge/background of technical issues in, aspects relating to Forest land use, peatlands emissions, restoration and conservation will be highly favorable. Familiar with green growth and green investment issue and strategic implementing in Indonesia and Provincial Level. Demonstrated understanding of and experience with Indonesian government system and key stakeholders in the forestry and land use sub-sectors, private sector and markets will be highly favourable. Experience in consensus building between different government departments via workshops and roundtables in Indonesia will be an advantage.
Other Competencies:Good working knowledge of ITC technologies. Confidential handling data and information. Good interpersonal and communication skills, with the ability to effectively interact with people in a multi- disciplinary and multi-cultural environment, Demonstrated ability to take initiative and work independently while also having the skills and interests to work effectively within teams. Able to understand and solve problems emerge, understand the related internal and external factors. Good in time management and organization. High initiative and sufficient work commitment Able to prepare required materials, following the standard format determined by GGGI. Have a passion for learning and be adaptive to the changes in business processes. Able to work under pressure. Fluent in Indonesian and proficient in English, both oral and written.
In order to be considered for the position, the candidate must meet the minimum qualification listed below. Consideration and selection will be based on a panel evaluation of the evaluation criteria factor below. Please note that only shortlisted/finalist applicants will be interviewed or contacted. GGGI does not pay for any expenses associated with the interviews unless expenses are pre-authorized. Reference check will be conducted on those candidates selected for an interview. The applicant's references must be able to provide substantive information about his/her past performance and abilities.
Interview and writing exercise may be requested. Applicants are required to prepare a brief narrative demonstrating how prior experience and/or education and training address selection criteria factors listed below:Professional Competency (30 points): At least a master's degree related to environmental conservation, economics, public policy, or other relevant degree from a reputable local or overseas universities Experience (30 points): Track record of at least 5 years of experience with forest management units, forest conservation projects and use of economic instruments for environmental sectors in Indonesia. Experience with sustainable forest management, prevention of forest degradation, payment environmental services, watershed restoration and restoration projects in Indonesia (can be over multiple engagements, please provide evidence of project completed with the stakeholders mentioned above). Strong knowledge/background of technical issues in, aspects relating to Forest land use, peatlands emissions, restoration and conservation will be highly favorable. Individual Competency (40 points): Good interpersonal and communication skills, with the ability to effectively interact with people in a multi- disciplinary and multi-cultural environment and demonstrated ability to take initiative and work independently while also having the skills and interests to work effectively within teams.
Maximum Points Available: 100
At GGGI’s discretion, reference checks and interviews may be conducted as part of the evaluation process.
Applicants must also include in their application package as follows:A cover letter of no more than 3 pages that demonstrates how the candidate’s qualifications meet the work requirements; A curriculum vitae which, at a minimum, describes education, latest experience and career achievements; Names, current and accurate contract numbers (email and phone) of three professional references that have knowledge of the applicant’s abilities to perform the duties set forth in the solicitation.
All the above information must be included in the application package in order for the package to considered complete
Interest candidates should send the above information directly in the link https://careers.gggi.org/vacancy/
All application submitted by GGGI website. Application submitted after the deadline will not be considered. Application, Cover Letter, and CV must be sent in English. A consortium, or a firm may not be engaged for the individual consultant assignment.
Value Added Tax clarification
Individual consultant without Indonesian tax ID: In accordance to Directorate General Taxation number SE-145/PJ/2010 VAT is applicable on foreign services rendered by international entities not registered in Indonesia are subject to 10% VAT.
Withholding tax on foreign services rendered/withholding tax Art 26
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Withholding tax on local purchase of goods and services
Payments of certain types of income paid to resident taxpayers are subject to withholding Art 23 at a rate of 15% (for dividend, interest, royalties) and 2% (rental of asset, other than land and building [which is subject to final tax Art 4(2)] and services such as technical, management, consulting services, etc).
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