A. Background

State administration is a whole activity conducted the government staff in implementing the state function according to the state’s purpose (Siagian, 2003, p. 2).[1] One of the activities which are carried by the government officials that the procurement of government goods and services. Procurement of goods and services is one key element in organizing the country’s development. For ordinary people’s activities, the procurement of goods/ services d not become a serious problem when almost 30-40% of the 2012 budget or approximately worth 450 trillion disbursed in this procurement activity.

The procurement of goods / services of misappropriation occurred in many activities. The contract, which is not in accordance with the tender process that is not true, mark-up the price by the amount unreasonable, naughty officials of commitment maker, not maximal work providers, as well as various other cases, the instances of corruption that eventually led activities procurement becomes an activity budget waste. This is evidenced by the 80% of cases of corruption there and be reported to the Commission related to the procurement of government goods / services. The conditions above prove that the Indonesian government is unaccountable in running the government.

As the implementation of the development of e-governance in order to make government professionals, governments apply a system of procurement of goods/services electronically which is often referred to as e-procurement. In general, the implementation of e-procurement is to increase public accountability in the procurement of goods and services. From the standpoint of normative in Presidential Decree Number 54 Year 2010 e-procurement aims to give the media the goods / services that are efficient, effective, transparent, open, competitive, fair and accountable.[2] On January 25, 2013 the President of the Republic of Indonesia issued Presidential the latest Presidential Instruction No. 1 of 2013 on the Prevention and Combating of Corruption Action Year 2013, one of which is requiring the procurement of goods / services with electronic tender system (e-Procurement) to 100% of procurement in the scope of the Ministry and Local Government. This was stated in item 147 on the Instruction attachment.

To support the acitivity of goods/service procurement, some of the government institution establishes the central of Layanan Pengadaan Secara Elektronik (LPSE). LPSE is a work unit established in whole ministry/institution/regional work unit/another institution to hold the system of goods/service procurement electronically and facilitate ULP/ Procurement Officer in implementing the procurement goods/service electronically. System of procurement electronically is created to manifest the expectation of the government procurement goods/service implementation electronically. The service available in the recent SPSE is E-Tendering, E-Audit, E-Catalogue, and E-Purchasing.

By this background, this paper wants to elaborate the system of procurement in Indonesia, especially the successful implementation of e-procurement conducted by several governments.

B. Discussion

Procurement of goods and services in the government is now entering a new phase, namely by applying the procurement of goods / services based on electronic or e-procurement. E-procurement by Sutedi (2012, h.254) is an auction system in the procurement of government goods / services with the use of technology, information and internet-based communication, in order to take place in an effective, efficient, open and accountable.[3] It is almost the same as the explanation of Indrajit cited by Andrianto (2007, h.218) that e-procurement is defined as a process of digitizing tender / auction long experienced the distinction of goods / services of government-assisted internet.[4] Simpler definition submitted by Andrianto (2007, h.215), that e-procurement is the procurement of goods / services conducted through the electronic auction.[5]

The legal basis for the implementation of e-procurement is Law No. 11 Year 2008 on ITE, Presidential Decree No. 80 Year 2003 and Presidential Decree No. 8 Year 2006. According to Presidential Decree No. 80 of 2003 as guidelines for the procurement of goods / services the government provides a definition of the procurement of government goods / services as follows: Procurement of goods / services is the government procurement of goods / services financed by APBN / APBD, well executed self-managed and by providers of goods. Furthermore, in the Circulation Letter of the Minister of Public Works No. 17 / SEM / M / 2010 regarding the implementation of the Supply of Goods and Services Selection of Electronic Government (E-Procurement) provides a definition: “Oversight of the distinction of electronic implementation or e-procurement is providing the goods / services using information technology and electronic transactions in accordance with the provisions of the legislation “. Regulations on carrying on government procurement of goods and services set in Presidential Decree Number 54 Year 2010 concerning Procurement of Government Goods / Services.[6]

Generally, e-procurement can be implemented by two methods, namely e-tendering and e-purchasing. E-tendering is a procurement process of goods/service which is participated by the goods/services provider electronically through once time bargaining, while the E-Purchasing is the process of procurement of goods / services conducted through the electronic catalog.

E-Tendering exactly the procurement pattern that has been carried out manually, the only difference being all phases conducted electronically, while the E-Purchasing uses a completely different way. User’s goods / services just choose the goods / services desired by the electronic catalog that is open and transparent. This catalog compiled by LKPP through an umbrella contract to the producer or the main provider, so the price is certainly much lower than the market price. Special E-Purchasing, currently still not been implemented, pending completion umbrella law signed by the President.

The purpose of the e-procurement implementation is to create transparency, efficiency and effectiveness and accountability in the procurement of goods and services through electronic media between service users and service providers. Demin (2002) added about e-procurement goal is to improve the level of service to users, and develop a more integrated approach to procurement through the company’s supply chain, as well as to make effective use of human resources in the procurement process.[7]

From the e-procurement process has been obtained some benefits such explained by Teo et.al., (2009) divides the advantages of e-procurement into 2 of the direct benefits (improve data accuracy, increase efficiency in operations, process applications faster, reduce costs administration and reduce operating costs) and indirect benefits (e-procurement to make procurement more competitive, improve customer services, and improve relationships with partners).[8] In addition Panayitou et al., (2004) also added that e-procurement can reduce the supply cost (an average of 1%), reducing Cost per tender (average 20% cost per tender), can give a lead time savings (open tender for an average of 6.8 months – 4.1 months and for a limited tender boasting an average 11.8-7.7 months), improved process (ordering simple, reduce paper work, reduce waste, streamline bureaucracy, standardization of processes and documentation.[9]

However in some ways, e-government procurement (e-GP) implementation in Indonesia is not easy. There are many obstacles encountered in the implementation, for example, recently an auction system through the Internet in various regions in Indonesia is complained by the provider of goods / services construction. They urged the government to delay the e-procurement system in 2008 with the reason a lot of abuse of e-procurement, including human resources and operational executor (Tempo, 2007). According to the research that has been done, the system electronic auction has yet to be implemented optimally at this time because it has not yet meet three preconditions the implementation of the government, namely the legal requirement of implementation (not ready for legal protection), the terms of the technical implementation / level of technological capability and requirement management / level human resource capacity (Gokmauli, F, 2008).[10]

E-procurement system of goods/service in Indonesia is still has many weaknesses and has been effective to be able to restrain the corruption. The guideline of the procurement of the goods and service as regulated in President Decree 80 Year 2003, is still enabled. Procurement of goods and services that are currently in force in Indonesia still have weaknesses and have not been able to effectively prevent corruption. Guidelines for Procurement of Government Goods / Services as stipulated in Presidential Decree 80 of 2003, it is still possible for the Procurement Committee and Goods / Services for corruption at every stage. The weakness was evident by the overwhelming cases of corruption related to the procurement of government goods and services handled by the KPK. In 2006 alone the corruption case related to the procurement of government goods and services reached 77 percent of all cases of corruption handled by the KPK.

Due to the chance of irregularities in the procurement of government goods and services, the Commission is also in charge of the areas of corruption prevention concentrate to participate solve the problem. Several agencies and local governments are also feeling the weakness in the system of government procurement of goods and services that exist today are no less innovative in finding solutions to the problem. Several agencies and local governments find solutions through an e-Procurement

Currently, e-Procurement is one of the best approaches in preventing corruption in the procurement of government goods and services. With e-procurement opportunities for direct contact between the supplier of goods / services procurement committee become smaller, more transparent, more efficient time and cost and easy implementation to perform financial accountability. That is because the electronic system gets international certificate. Based on the advantages that exist in the e-Procurement, the Commission encourages all government agencies to gradually implement e-Procurement in the procurement of goods and services.

One of the local governments that implement e-procurement is Bojonegoro. Bojonegoro is implementing the use of electronic systems in the auction of goods / services (e-procurement) Best of 2012 district level in Indonesia. Basically effectiveness is measuring the degree of success of the organization or program in achieving its intended purpose. Therefore, to see the implementation of e-procurement in Bojonegoro is effective or not, it can be seen from how much the implementation of e-procurement in Bojonegoro has achieved the goals set in Presidential Decree No. 54 of 2010 contained in article 107. This is because that is one of Bojonegoro Regency implement policies sis-tem use of e-procurement has been made by the Central Government. In addition, Bojonegoro is a District that has received an award from the Institute Procurement Policy of Goods / Services (LKPP) as the best e-procurement system.

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