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Toll road
Assessment of the government’s projects
role performance in public-private
partnership (PPP) toll road
projects in Indonesia 239
Mohammad Arif Rohman Received 30 July 2019
Revised 7 February 2020
Department of Civil Engineering, Construction Management Laboratory, 14 May 2020
Institut Teknologi Sepuluh Nopember, Surabaya, Indonesia 20 October 2020
5 January 2021
24 May 2021
Accepted 19 July 2021
Abstract
Purpose – This study aims to investigate the government’s role in the development of toll road projects that
adopt public-private partnership (PPP) schemes in Indonesia. In addition to investigating its role, this study also
attempts to quantitatively assess its performance as the use of quantitative analysis in this area is still fairly
limited. The analysis was developed from the perspectives of two main stakeholders involved: government and
private sectors. The findings of this study are expected to help both government and private sectors to better
understand the government’s role as well as its performance in PPP toll road projects in Indonesia.
Design/methodology/approach – The data was analysed by using statistical methods. Following the
identification of the government’s role in PPP toll road projects from the literature, a preliminary survey
involving 12 highway construction experts was conducted to verify the initial findings from the literature
review. Subsequently, the authors conducted a survey of 146 respondents from both government and
private sectors. To analyse the collected data, both descriptive and inferential statistics were used, which
include analysis of means, analysis of reliability, as well as independent T-test. T-test was used to examine
differences in perception between the two groups.
Findings – In total, 12 criteria from the literature were used to assess the government’s role and its
performance in PPP toll road projects in Indonesia. Based on the analysis, the authors find that the
government’s role in the development of PPP toll road projects can be considered moderate in its performance.
In this respect, the author argue that, instead of focusing on meeting all the criteria, it would be better for
government to focus on meeting only a number of them, which include realizing smooth land acquisition,
selecting appropriate concessionaire, offering a solution to community protests over environmental issues,
providing substantial government support, providing supervision, enforcing the law and eradicating
corruption. The results of this study provide valuable information for international parties aiming to
participate in PPP toll road projects in Indonesia, considering this country has been offering a wide
opportunity for private sectors to be involved in developing infrastructure. Meanwhile, for the host
government, the findings can be used as the basis for conducting improvements to attract private sectors’
involvement and to achieve more successful upcoming PPP toll road projects in Indonesia.
Research limitations/implications – The findings of this study might provide valuable information
for the host government to evaluate its role and performance to achieve more successful PPP toll road projects
in the future. Rather than focusing on all attributes, the improvements can be made by focusing only on the
critical ones: those ranked high on the importance and low on its performance. In addition, this finding can
also help private sectors to better understand both the role and performance of government in Indonesia as
this country offers a great opportunity for infrastructure investment through PPP schemes.
Practical implications – The findings of this study might provide valuable information for the host
government to evaluate its role and performance to achieve more successful PPP toll road projects in the future.
Journal of Financial Management
of Property and Construction
Vol. 27 No. 2, 2022
The main author thanks The Indonesian Ministry of Research, Technology and Higher Education pp. 239-258
which sponsored this research. The authors also thank all respondents who participated in the © Emerald Publishing Limited
1366-4387
interviews and questionnaire survey. DOI 10.1108/JFMPC-07-2019-0065
JFMPC Rather than focusing on all attributes, the improvements can be made by focusing only on the critical ones: those
ranked high on the importance and low on its performance. In addition, this finding can also help private sectors to
27,2 better understand both the role and performance of government in Indonesia as this country offers a great
opportunity for infrastructure investment through PPP schemes.
Social implications – Text.
Originality/value – This paper contributes to the body of knowledge on the criteria to assess the
government’s role performance in the Indonesian PPP toll road projects. Whilst there is still limited research
240 has been conducted regarding the government’s role in the PPP toll road projects in Indonesia, this study
presented the criteria of the government’s role and showed how to assess and evaluate the host government’s
performance based on these criteria in a more objective approach using quantitative method. This result can
be used as the basis for improvements to achieve a more successful PPP toll road project in Indonesia and
might be in other similar developing countries.
Keywords Project success, Toll roads, Government’s role, Indonesian infrastructure,
Public-private partnerships (PPP)
Paper type Research paper
1. Introduction
Infrastructure plays an essential role in economic development. For a developing country, it
is expected that public-private partnerships (PPP) can offer solutions in regard to the budget
limitation in developing public infrastructure by collaborating with private sectors. In
Indonesia, toll road has been a vital project, especially for these past few years, as the
Government of Indonesia (GoI) intends to develop toll roads to support the country’s
economic growth (Wibowo, 2005; Rohman, 2017). Unfortunately, the development of toll
road projects in Indonesia has not been quite successful. Even though toll roads in Indonesia
have been built since 1978 and the private sector has been involved since the 1990s
(Abednego and Ogunlana, 2006), there is only 2,000 km of toll roads under the operational
stage (Badan Pengatur Jalan Tol (BPJT), 2019; DetikFinance, 2019).
Although several factors have been reported as the causes of this problem, it is important
to note that the success of the PPP project heavily depends on the role of the government. It
is the host government’s role to ensure political and economic stability, good governance,
favourable legal and regulatory framework, transparent procurement mechanism and well-
committed public agency (Zhang, 2005a).
Previous studies have proposed the attributes of government’s role in PPP projects
(Birgonul and Ozdogan, 1998; Kumaraswamy and Zhang, 2001; Zhang, 2005a; Kwak et al.,
2009), including the critical success factors (CSF) (Chan et al., 2010; Wibowo and Alfen,
2015). However, there is still limited investigation that focuses on the attributes of the
government’s role in PPP toll road projects in Indonesia. Indonesia as a developing country
has been offering a massive opportunity to the involvement of the private sector in public
infrastructure development. Moreover, research on this topic that uses a quantitative
approach to assess stakeholders’ perceptions is still scarce.
This paper focuses on the examination of the government’s role and its performance in
PPP toll road projects in Indonesia. This study uses a quantitative approach to assess
the perceptions of two main stakeholders involved: government and private sectors. The
perceptions of these two stakeholders are essential to the comprehensive examination of
the government’s role and its performance in PPP toll road projects. The goal of this paper
can be divided into three objectives, namely, to find out the criteria or attributes to measure
government’s role in PPP toll road projects, to assess the performance of government’s
role based on stakeholders’ perceptions and to find room for improvement in government’s
role to deliver better PPP toll road implementation in Indonesia.
2. Literature review Toll road
2.1 Public-private partnerships toll road implementation in Indonesia projects
Traditionally, the government is responsible for public infrastructure provision (Tsamboulas
et al., 2012). However, infrastructure provision in developing countries is often limited by
technology as well as the budget of the government (Kumaraswamy and Zhang, 2001). PPP
concept has been widely proposed to overcome the public sector’s limitation as it is believed
that it has many advantages such as potentially using private sector’s resources, stirring up
innovation, improving productivity, providing better risk allocation, promoting value for 241
money and delivering cost-effectiveness (Ng et al., 2012).
According to Wibowo (2005), for a number of years toll road projects have become essential
PPP projects in Indonesia as the government aims to support the country’s economic growth
through either built-operate-transfer (BOT) or operation-and-maintenance-contract scheme as
parts of the PPP scheme. Badan Perencanaan Pembangunan Nasional (BAPPENAS) (2010)
explains that 17 out of 26 priorities for PPP projects between 2010 and 2014 were toll road projects.
To attract private sectors, several actions were carried out by the GoI to streamline the
process such as establishing a new policy regulation framework (Wibowo and
Kochendoerfer, 2011). However, Rostiyanti and Tamin (2010) assert that those actions have
not been entirely successful to attract the involvement of private sectors because, since 2005,
there have been insignificant changes in toll road length in the operation phase. Indeed,
attracting private sectors in infrastructure development is not as simple as it appears, as this
type of project involves a high degree of risks (Wibowo and Kochendoerfer, 2011).
Problems regarding the implementation of toll roads have been identified by Rostiyanti
and Tamin (2010). Some of them include excessive government intervention in the process,
limited support from the government, as well as complex and conflicting regulations.
Abednego and Ogunlana (2006) also point out that there are often delays in the decision-
making process which can negatively impact the smooth running of the implementation.
The literature suggests that PPP is not a panacea that can solve all problems and is
suitable for all project settings (Cheung et al., 2012). Implementing PPP is not easy work as
this concept requires certain and particular environments to be successfully implemented (Li
et al., 2005a; Chan et al., 2010; Hwang et al., 2012). In this respect, the success of PPP toll road
projects is influenced by a number of factors such as transparency of procurement process,
good governance, a reliable and good private consortium, political support, stable
macroeconomic condition, favourable legal framework, guarantee and involvement from the
government, well-organized and committed public agency, as well as appropriate risk
allocation and sharing (Li et al., 2005a; Chan et al., 2010; Hwang et al., 2012). Those
aforementioned factors are highly influenced by the role of the government as the main actor
in the PPP project (Kwak et al., 2009). Therefore, we argue that the government’s role is an
important factor for the success of this type of project.
3. Research design
3.1 Identification of research variables
Identification of research variables was carried out by selecting attributes from previously
published works. Studies on the government’s role in PPP projects, CSF, risks in PPP projects, as
well as barriers of PPP implementation were carefully reviewed and synthesized to generate the
attributes of the government’s role. We identified many factors related to this topic from the
literature. Nonetheless, there are a number of attributes that overlap with each other as they share
similar characteristics. Thus, we either delete them or combine them into meaningful categories.
At the final stage, we managed to identify a total of 12 attributes of the government’s role in PPP
projects. These attributes are further classified into seven major categories (Table 1).
As depicted in Table 1, there are seven major categories: selecting and planning on
appropriate PPP projects, providing favourable investment environment, developing legal
and regulatory framework, conducting competitive procurement and contractual
arrangements, providing supports and guarantees, establishing good governance in
bureaucracy and monitoring and supervising project implementation. To test the validity of
these attributes, we conducted an interview with 12 highway construction experts.
five years of field experience and were involved in at least three toll road projects. Semantic
scale from 1 (not very relevant) to 5 (very relevant) was used to measure experts’ opinions.
Mean and standard deviation (SD) were used to analyse the relevancy and importance of
the attributes. As stated before, this study adopted Rohman and Wiguna (2019), who use the
middle score (3.00) as the cut-off to determine the relevance of the attributes. Thus,
attributes with a mean higher than 3.00 are considered relevant to be included in the
measurement of the government’s role. Experts’ opinion regarding the 12-attributes from the
preliminary survey is presented in Table 2.
As shown in Table 2, the mean of all attributes identified from the literature is
larger than the cut-off point (3.00). Majority of them (9 out of 12) even have a higher
mean score than 4.00 and only three attributes have an average score of slightly lower
than 4.00. Therefore, the overall attributes were considered to be relevant in the
measurement of the government’s role in PPP toll road projects in Indonesia.
The rank of the five most important attributes, listed from the most relevant to the least
relevant, is as follows: realization of the smooth land acquisition process (mean 4.83),
JFMPC
27,2 No. Government’s role attributes Mean SD
4. Result analysis
The main survey was conducted following the primary survey and the pilot test through
questionnaire distribution across eight selected toll road projects in Indonesia under the PPP
scheme. A total of 146 samples were obtained from the main survey and explained in the
next section.
Selection of a feasible PPP project was the attribute ranked the highest among other
attributes (4.089), as well as from the perceptions of government (4.068) and private sector
(4.110). This finding indicates that all parties share the view of this attribute being a good
measure of government’s performance.
The provision of stable political conditions (mean 3.966) and the establishment of stable Toll road
economic conditions (mean 3.893) are placed in the second and third positions, respectively. projects
Nevertheless, the government has a different view of these two attributes. The government
ranks the provision of stable economic condition in fifth place (mean 3.877), whilst the
private sector ranks this attribute in second place (mean 4.055). Meanwhile, the provision of
the stable economic condition is ranked fourth (mean 3.877) from the government
perspective whilst the private sector places this attribute in the third position (mean 3.909).
The fourth position of the government’s role performance was the provision of
247
appropriate government support (mean 3.822). Again, the government shared a different
perception with the private sector as this attribute was ranked in second place (mean 3.932).
However, according to the private sector’s view, this attribute was positioned in fourth place
(mean 3.712). Good communication between the government and the private sector ranked
fifth among the overall attributes (mean 3.747). Nevertheless, this attribute was placed in the
sixth position according to the government (mean 3.822) and fifth position according to the
private sector. The realization of the smooth land acquisition process was ranked the lowest
among the overall government’s role performance attributes (3.096). Even though the
government ranked this attribute in the 11th position, the private sector placed this attribute
in the lowest position, namely, the 12th position.
The highest difference in perception between the two sectors was regarding the
appropriate supervision attribute (0.516). In this case, those who belong to the private sector
perceived that they had already been supervised sufficiently by the government (mean
3.639), even though the government did not have a similar perception about it (mean 3.123).
The second-highest difference perception between the government and the private sector
was related to the corruption eradication attribute (0.466). The government perceived that
they had already performed corruption eradication (mean 3.644), whilst the private sector
gave a lower score about it (mean 3.178). The third highest difference perception between the
government and the private sector was on the simplification bureaucracy procedure (0.397).
In this case, the government scored this attribute higher (mean 3.904) compared to the
private sector (mean 3.507). Meanwhile, for the other nine attributes, the difference in means
ranged between 0.032 and 0.023.
Table 4 also showed that the overall sector performances were still below the satisfactory
level (4.000) or called sub-optimal. Only one attribute obtained a score above 4.000 from a
total of 12 attributes. Meanwhile, 11 other attributes had scores under 4.000. The average
score from the 12 GR’s attributes was 3.657 (below 4.000). The attributes scored between
3.000 (neutral) and 4.000 (agree). It can be said that the performance is still not optimal
because, as explained in research design Section 3.3, to be considered having good
performance, the minimum score for an attribute should be more than 4.000 (agree) because
the questionnaire was designed as positive statements to represent the respondents’
agreement (Rohman et al., 2017). Therefore, the score should be at least 4.000 (agree) if the
respondents are satisfied with the attributes’ performance.
5. Discussion
According to the analysis result, it is found that the existing government’s role performance
in PPP toll road projects in Indonesia is still not quite satisfying (moderate level) where the
Levene’s test for
equality of variances t-test for equality of means
95% confidence interval
of the difference
Sth.
Sig. Mean error
F Sig. t df (two-tailed) difference difference Lower Upper
GR1 Equal variances 1.008 0.317 1.429 144 0.155 0.17808 0.12465 0.42447 0.06831
assumed
Equal variances not 1.429 134.167 0.155 0.17808 0.12465 0.42462 0.06846
assumed
GR2 Equal variances 0.418 0.519 0.268 144 0.789 0.03237 0.12058 0.27071 0.20596
assumed
Equal variances not 0.268 143.471 0.789 0.03237 0.12058 0.27072 0.20597
assumed
GR3 Equal variances 4.533 0.035 2.816 144 0.006* 0.39726 0.14105 0.11846 0.67607
assumed
Equal variances not 2.816 143.798 0.006* 0.39726 0.14105 0.11845 0.67607
assumed
GR4 Equal variances 0.172 0.679 2.923 144 0.004* 0.46575 0.15933 0.15083 0.78068
assumed
Equal variances not 2.923 143.477 0.004* 0.46575 0.15933 0.15082 0.78069
assumed
GR5 Equal variances 3.096 0.081 1.619 144 0.108 0.23288 0.14385 0.05146 0.51721
assumed
Equal variances not 1.619 143.277 0.108 0.23288 0.14385 0.05147 0.51723
assumed
GR6 Equal variances 0.015 0.901 1.403 144 0.163 0.24658 0.17580 0.10090 0.59406
assumed
Equal variances not 1.403 143.988 0.163 0.24658 0.17580 0.10090 0.59406
assumed
GR7 Equal variances 6.628 0.011 1.308 144 0.193 0.15068 0.11520 0.07702 0.37839
assumed
1.308 137.535 0.193 0.15068 0.11520 0.07711 0.37848
(continued)
role attributes
Toll road
Table 5.
the government’s
249
250
Table 5.
JFMPC
Note: *Italic bold means there are significant different perceptions between the two sectors
attributes mean are still below 4.000 (four) score as the minimum score which shows the Toll road
respondent’s agreement related to good attribute performance. This study confirmed a projects
previous study that revealed that the performance of PPP success factors related to the
government is still somewhat below moderate (Wibowo and Alfen, 2015). Perhaps, this is
the reason for the quite unsuccessful implementation of the existing toll road projects in
Indonesia.
The above result should become the reason for the host government to perform some
improvements on its role in the PPP scheme. The GoI should perform its role better to
251
achieve more successful PPP toll road projects. Indeed, the success or failure of any PPP
project heavily depends on the government’s role (Kumaraswamy and Zhang, 20010). PPP is
not a panacea that can be implemented in all project environments. There are some
prerequisites for the successful implementation of this scheme where several of them only
can be provided by the host government. The willingness of the private sectors to be
involved in these projects greatly depends on the government’s role performance in the host
country (Zhang, 2005b). It happens where the government can provide a conducive
environment to support business operations.
Based on the government’s role evaluation, it was found that most of the attributes need
improvement as 11 out of 12 attributes scored lower than 4.000 as the minimum score.
However, rather than the overall attributes, the improvement could be focused on solely some
of them which were considered critical (Rohman and Wiguna, 2019). This is conducted by
selecting attributes which performances are not quite satisfying (score is lower than 4.000) but
considered very important attributes (score is higher than 4.000). Eight critical attributes can be
included as the focus on the improvement, namely, the realization of the smooth land
acquisition, appropriate supervision, selection of the appropriate concessionaire, law
enforcement, simplification of bureaucratic procedure, solving community protest regarding
the environmental issues, development of good communication between the government and
the concessionaire and provision of appropriate government support.
Firstly, the realization of a smooth land acquisition process becomes the priority that
should be improved by the government. This research finding is confirmed by Tamin et al.
(2011), revealing that land acquisition still becomes one of the main challenges in Indonesian
toll road development. Indeed, there is an improvement in this aspect of the current toll road
development. However, the process still needs to be improved to provide certainty for the
investor. Land acquisition is a complicated issue in PPP projects as many projects are
delayed or even cancelled because of this issue (Kumaraswamy and Zhang, 2001). This
problem also happened in several BOT road projects in Bangkok, Thailand and Guangzhou,
China, causing project delays (Chen and Doloi, 2008). Therefore, it is the role of the host
government to smooth the land acquisition process which prevents time delay and cost
overruns. In Indonesia, the land is owned by the community and, without the community’s
permission, it cannot be used for public infrastructure. The government should plan
appropriate approaches for the community to ensure a smooth land acquisition process. The
government that is represented by Land Provision Committee (P2T) is the main actor in the
land acquisition process (Tamin et al., 2011). It is difficult for the private sector to deal with
this issue without the government’s support and involvement. The government should
provide clear and adequate procedures for the land acquisition process as well as they need
to be consistent in implementing them. This process is usually related to the simplification
of the regulation and bureaucratic system as well as the law enforcement. Recently, the
government published Peraturan Presiden (Presidential Decree) No. 66 in 2020 which is
expected can smooth and simplify the land acquisition process (PP No. 66, 2020).
JFMPC Secondly, appropriate supervision should also be improved. This is needed because it is
27,2 not enough for the government to only select the private sector and then transfer as many
risks as possible to them without being actively involved in the process. The government
needs to supervise the project implementation to ensure that the project is executed within
the allocated time, budget and also meets the specification. Therefore, proper supervision
(Li et al., 2005a) at each stage of the project must be carried out to ensure that the design and
252 planning are appropriately implemented. Appropriate supervision should be performed in
the overall project lifecycle to ensure that the project is implemented as expected. In the
construction stage, the government has to ensure that the project execution meets the project
objective and success criteria. Meanwhile, in the operational stage, the government needs to
ensure that the toll roads service quality is achieved or meets the target. Good service
quality is one of the main objectives in applying PPP schemes, that is to achieve better value
for money (Grimsey and Lewis, 2005).
Thirdly, the selection of an appropriate concessionaire should also be conducted in this
PPP scheme. Appropriate selection of the developer or concessionaire can increase the
chance of successful PPP projects (Rohman et al., 2015). It can be achieved when the
government conducts a fair and competitive bidding process (Zhang, 2005b). Through this
process, a concessionaire that best meets the criteria can be selected. Zhang (2005a) also
added that not only giving competitive tendering but also providing a clear contract that can
accommodate appropriate risk allocation. In the existing practice, the government usually
selects the private concessionaire which provides the most attractive financial consideration.
However, as the need to implement the sustainable construction concept in the context of
PPP, competitive procurement should also consider the sustainability performance
(Koppenjan, 2015). This sustainability practice should balance the three components,
namely, economic, environmental and social aspects. Indeed, integrating the sustainability
concept in PPP implementation is essential, considering that this type of project has a long
project life cycle (Kumaraswamy et al., 2007). As such, competitive procurement in PPP
should motivate the private sector to present an innovation (Verweij et al., 2019) that
improves sustainability achievement.
Fourthly, law enforcement is also very important. Providing legal certainty is needed by
the private sector to run the business. All regulations that have been issued should be
strictly enforced (Zhang, 2005a). Corruption is usually happened due to the incomplete or
unclear regulatory framework combined with the weak of law enforcement. Indonesia has
various types of law and regulation at different levels, yet has problems regarding its
enforcement (Wibowo and Alfen, 2015). An example of the importance of this law
enforcement is in the case of the land acquisition process above. In the current practice, the
land acquisition process in Indonesian PPP still cannot be executed optimally and is often
delayed because of the weakness of this aspect’s implementation (Rostiyanti and Tamin,
2010). Therefore, the process of land acquisition should be implemented through a
transparent and fair procedure based on the regulation to minimize the action of land
speculators or otherwise, this process is complicated to be timely implemented (Rostiyanti
and Tamin, 2010).
Fifthly, simplification of bureaucratic procedure should also be improved as this is
usually related to regulation and law enforcement issues as has been explained previously.
Several variables have been identified as barriers to PPP projects: bureaucratic procedures,
too many institutional players and risks due to poor local governmental administration and
corruption (Zhang, 2005a). The bureaucratic and regulation problems were considered to be
a hindrance in the process of land acquisition (Rostiyanti and Tamin, 2010). It is, therefore,
very important for the host government to establish a simple and easy bureaucratic system,
which can eradicate corruption and to make sure every person has an equal position under Toll road
the law. By establishing a reliable bureaucracy, a smooth and fast approval process can be projects
executed for time and budget efficiency. Conversely, too many problems in the bureaucratic
system could make every step longer, which could finally lead to budget increase and time
extension of the project completion. The problem in the bureaucratic system can also
influence the private sector’s interest to have less trust in the government. These
bureaucratic problems also increase opportunities for corruption. Owusu et al. (2019) argued
253
that corruption has adverse effects in lowering the construction work quality and distort the
entire process of procurement. The private sector is possibly reluctant to get involved in the
PPP scheme because of the corruption that happened in the host country (Zhang, 2005a),
making the business risk higher.
Sixthly, solving the community protest regarding the environmental issues is also needed as
the construction of toll road projects play role in the life of the surrounding environment and
community. As the result, the community protests the toll road development which often causes a
delay in the project. Regarding this, the government should manage this process with an
appropriate approach. Indeed, community support is very important for a successful
infrastructure project development. A failure to accommodate the community’s aspirations as
part of the project would cause stakeholders’ opposition that potentially results in project failure
(El-Gohary et al., 2006; Li et al., 2013). Woltjer (2002) highlighted that using an appropriate
approach to solve the community’s aspirations is vital to reduce social problems. Referring to
that, the best way to accommodate the community’s needs in the decision-making process is by
involving their perspective in a PPP scheme (Rohman et al., 2017). It is believed that stakeholder
consultation can be a good channel to solve any public issues on PPP implementations. Solving
social issues might minimize stakeholders’ opposition and gradually improve the chances of
success of this project. On the other hand, this project might not work and stakeholders’
opposition can happen due to the failure of responding and fulfilling the community expectations
(Majamaa et al., 2008).
Seventhly, the development of good communication between the government and the
concessionaire. This is very important and one of the PPP success factors as this type of project is
a long concession period partnership between the public and private sectors that involve many
stakeholders and types of risks in its implementation. Maintaining good communication between
these two parties can lead to better project coordination which affects the project performance.
Kumaraswamy and Zhang (2001) pointed that poor project coordination is one of the reasons
why several PPP projects in the area of energy and transportation were unsuccessful. Good
project coordination may happen where there is good communication between any parties
involved in the project implementation, especially between the government and the
concessionaire. Potential disputes between any parties involved can be reduced if good
communication can be realized between these two main parties (Kwak et al., 2009).
Eightly, the provision of the private sector that needs government support should also be
improved, as some risks on political and economic conditions in PPP projects can occur. The
government should provide appropriate and adequate support. PPP projects have higher
risks than traditional projects so the private sector could be thinking very carefully about
investing in PPP projects. To attract private sector involvement, the host government needs
to provide support or a guarantee to minimize the private sector’s risk. Therefore, an
appropriate and adequate support of the government is needed to minimize the private
party’s risks (Kumaraswamy and Zhang, 2001). According to Osei-Kyei and Chan (2017),
government support is one of the CSF in PPP projects which is applied in many countries,
even though its manifestation can be different among jurisdictions. The government
JFMPC support can be realized by providing tax relief, exchanging rate differences and being
27,2 flexible in toll tariff adjustment (Kwak et al., 2009)
6. Conclusion
Even though PPP research has been widely explored in published literature, there are still
limited works that have been conducted which focuses on investigating the attributes of the
254 government’s role in PPP toll road projects in Indonesia based on a quantitative approach.
This paper presents attributes to measure the government’s role as well as assess its
performance in PPP toll road projects in Indonesia using statistical analysis from the
stakeholders’ perception, namely, the government and the private sector. According to the
result, it was found that 12 attributes were considered relevant or important to be used to
assess the government’s role performance in PPP toll road projects in Indonesia.
The research also found that the performance of the GoI role in toll road development can be
categorized as a “moderate” one, meaning that there should be an improvement on the current
government’s role performance to achieve more successful project implementation. In this
research, the government and private sector mostly did not have quite significantly different
perceptions regarding the government’s role attributes. This means that the questionnaire was
valid for the analysis, which complemented the reliability test in this research.
The above result can be used as the basis for the current PPP toll road projects
implementation in which the GoI should improve its roles to achieve a more successful toll
road projects implementation, considering that this country is intensively attracting the
private sector in developing toll roads through PPP scheme. The improvement should be
focused on seven attributes that are considered critical, namely, the ones which are very
important, yet have low performance in the existing practice. Those critical attributes are
the realization of the smooth land acquisition, appropriate supervision, selection of the
appropriate concessionaire, law enforcement, simplification of bureaucracy procedure,
solving community protest related to the environmental issues, development of good
communication between the government and the concessionaire and provision of
appropriate government support.
This study contributes to the body of knowledge by providing an understanding of the
government’s role attributes and its performance in PPP toll road projects in Indonesia or even in
other developing countries that have similar characteristics to Indonesia. These findings can be
used as a guide for the host government as the most powerful stakeholder to improve its
performance in implementing the PPP model successfully. This study can also help the private
sector understand the PPP environment in a developing country such as Indonesia which offers a
large opportunity for private involvement in toll road projects development.
Further reading
Heywood (1999), Political Theory: An Introduction, Macmillan Press Ltd.
Neuman, W.L. (2012), Basic of Social Research: qualitative and Quantitative Approaches, Pearson.
Ng, S.T., Wong, J.M.W. and Wong, K.K.W. (2013), “A public private people partnerships (P4)
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Corresponding author
Mohammad Arif Rohman can be contacted at: arif@ce.its.ac.id and arif.its@gmail.com
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