A major challenge facing Indonesia's new president, Soesilo Bambang Yudhoyono, is reform of the internal security sector. He could make an important contribution by initiating a comprehensive review of policy and operations, in order to develop a roadmap to guide organisational reform, a legislative agenda and a strategy for conflict prevention and resolution. Only presidential leadership can trump institutional rivalries and launch a process that is vital to Indonesia's democratisation.

Major problems include:

• unclear institutional division of labour, particularly between the police and the military (Tentara Nasional Indonesia, TNI);
   
• contradictory or ambiguously worded legislation on some aspects of internal security and no legislation at all on others;
   
• lack of accountability of the security services;
   
• inadequate oversight of operations; and
   
• no strategic direction.

One of the thorniest issues is the precise division of labour between the police and military. Formal responsibility for internal security has rightly been allocated to the police but there are "grey areas", such as counter-terrorism and counter-insurgency, where the roles are poorly defined. Moreover, even in areas that are exclusively police responsibility, such as upholding law and order, police capacity remains weak. The force needs to be doubled and its performance markedly improved before the military can be confined to external defence, the ultimate goal of most reformers. The question is how to define a transition role for the military in internal security while police capacity is being developed, without further blurring the lines between them. A law on TNI support to the police is currently being drafted, but has become a source of friction.

Intelligence is another difficult area, particularly in light of Indonesia's terrorism problem. The intelligence functions of the police, military, and National Intelligence Agency (BIN) overlap, and coordination is not smooth. The government needs to work out an appropriate division of labour, probably through legislation, but in a way that ensures that all three maintain political neutrality, are subject to civilian oversight, and do not acquire powers beyond what is acceptable in a democratic society.

The president has several options for addressing another problem, the lack of any clear policy direction or control over internal security. One possibility is to strengthen the office of the Coordinating Minister for Political, Legal, and Security Affairs, his old job. Another is to create a U.S.-style National Security Council, an idea much talked about but difficult to implement without a legislative mandate. He could also give the internal security portfolio to an existing ministry, or create a new ministry for the purpose. But any new bureaucratic arrangement would require funding, and the president would have an uphill battle to secure the necessary support from an obstreperous parliament he does not control.

No reforms are likely to succeed, however, without effective, professional oversight mechanisms involving the parliament, the courts, parts of the executive branch itself, and civil society. Without both fiscal and human rights accountability, legislative or bureaucratic changes can only go part way toward solving the problems.

As a first step toward a comprehensive review of internal security, the Yudhoyono government should consider producing a concept paper that defines the problems, allocates responsibilities among different bodies, provides guidance on capability development, and identifies how these will change as conflict is resolved and capacity improves.

Jakarta/Brussels, 20 December 2004