NCICD

Institutional Status
PMU Support Consultant
July 2014

Asset Management: sheet 27-33

Content
1. Master Plan stage: PMU
2. Implementation stage:
• Single Authority
• Legal basis
• Strategic Company
• Decision making agenda
3. Asset Management stage: Asset owner, Asset Manager &
Service Provider
4. Communication and Consultation
5. Knowledge and Capacity Development
6. Budgets 2014-2015
Evolution of program management

Master Planning Implementation O&M

(2013 – 2014) (2014 – 2020) (2014 – 2020)

PMU = Planning / Programming &

coordination platform
• Master plan
• Investment program
• Preparation of priority measures

Implementing Body
• Stage A
• Stage B
• Stage C

Water Management / Asset

Management Body
• Lagoon management
• O&M of pumpstations & locks
• Dike maintenance
Master Plan Stage

PROGRAM MANAGEMENT UNIT

 Current institutional setup
Steering
Strategic Direction
Committee

Coordination
Policy coordination
Team
PMU=Coordination Platform
Diffusive Program ownership
Limited mandate
Limited capacity PMU Management
Limited budget

PMU Operational
Master Plan
Assistance
 Parties involved
Steering Executive
Coordination Team
Committee Committee

• Coordinating Minister Echelon-1 Echelon-1 Representative from:

of Economic Affairs Representative of: • Ministry of Politics, Justice and Security
• Coordinating Minister • MENKO • Ministry of Home Affairs
for Politics, Justice • Bappenas • Ministry of Finance
and Security • PU • Ministry of Bappenas,
• Minister of Public • DKI Jakarta • Ministry of Public Works,
Works (Sekda) • Ministry of Environment
• Minister of Bappenas • Ministry of Mining and Natural Resources
• Other related • Ministry of Transportation
Ministers
PMU • Ministry of Marine and Fisheries
Managing Committee • Ministry of Research & Technology
• Gubernurs of DKI
Jakarta, Banten and • Ministry of BUMN
Echelon-2 • Ministry of Defence
Jawa Barat.
Representative of: • Indonesian National Police
• MENKO • Jawa‐Barat and Banten (SekDa)
• Bappenas • BKPM
• PU • BMKG
• DKI Jakarta • BPN
• BPBN
• BIG/Bakosurtanal
• BPPT
PMU status
The fragmented and time consuming coordination
mechanism cannot keep pace with the actual developments
Sector priorities and preferences come first
The number of interfaces to be managed increases
dramatically
The flow of information becomes more intense and complex
Absorption capacity is limited, especially for funding,
financing and delivery model complexity
Project concept not entirely understood or accepted
Fragmented communication (not one clear message)
Risk of poor or wrong decision making or no decisions at all

Title: RHDHV Powerpoint V04 22/06/2012 Page 7

Subtitle of presentation 22 June 2012
PMU status
The program needs to be opened up to the market soon
The market prefers/expects to deal with a single and trusted
Authority, not with several institutions having different views
and interests
Relations between the Authority and private sector parties
have to be developed
Long term program requires stable regulatory framework,
clear output specifications and acceptable risks for both
public and private parties
The Authority should have sufficient autonomy, mandate
and reliability to do business with.

Title: RHDHV Powerpoint V04 22/06/2012 Page 8

Subtitle of presentation 22 June 2012
Implementation Stage

TOWARDS A SINGLE AUTHORITY

 Why a single Authority is needed?
• Magnitude of the program ( 9 components / US$ 40
billion) exceeds capabilities of individual Ministries and
Agencies. A fully dedicated Entity is required.
• The program is cross cutting legal boundaries of tasks
and functions of Ministries, Agencies and Regions (DKI
Jakarta, West Java and Banten provinces)
• Program includes commercially viable and non-viable
components. Cross funding requires bundling of
components and integrated cash flow management
under one umbrella
• Commercial development capacity needs to be
established within the Authority
• Investors prefer one window for doing business
Government strategy towards Private Sector
Government Private
Regulations that provide
new room for innovation in Incentive for private sector
project delivery including to develop most effective
wide arrays of PPP PPP scheme
modalities

Ensure clear mandate and Giving clarity and

strong authority with confidence in dealing with
adequate resources to focus various issues surrounding
on project delivery .
Proof of the project
Guarantee the availability of Commitment
funding for basic safety Building the trust and boost
components. Shows private sector confidence.
government commitment and Allows to focus on efficiency
sets basis for private
participation
measures

Under clear legal base, will Gives certainty in

provide decisiveness and
procurement process
confidence to expedite the
procurement process hence resulting in faster delivery
project delivery and better implementation
Institutional setup Implementation Stage
President
RI

Steering Ministers & Governors

Committee CMEA, PU, Bappenas, DKI, JaBar …..

NCICD
Development Implementing Body
Authority

Strategic Company

Projects
One NCICD
• One Program
• One Authority
• One Law
• One Fund
• One Message
• One Voice
NCICD Development Authority
• The DA represents the single organization through
which NCICD is realized
• The DA is established on the legal basis of Perpu
(emergency status) and subsequent permanent
legislation
• It consists of a Steering Committee, Implementing
Body and Strategic Company
• The strategic company (SOE) develops the project
pipe line and manages project implementation
under various forms of private sector engagement.
 Steering Committee
• The SC represents all relevant government
bodies and is directly accountable to the
president
• Functions:
– Policy guidance, coordination and strategic
direction
– Approval of annual plan and budget of the
Authority
 Implementing Body
• The IB is the Regulatory and Executive Body within the DA.
It acts on behalf of the participating governmental
institutions and takes into account interests of the private
sector and the society.
• Main functions:
– Strategy implementation
– Supervision of the performance of the Strategic Company
– Approval of business plans of SC
– Balancing & safeguarding stakeholder interests
• Composition:
– Chairman appointed by the President (Minister level)
– Executive secretary
– Deputy Chairmen for key functions/departments: Investment
Planning & Programming, Program Implementation, Operation
& Maintenance, Monitoring & Evaluation
– Advisory Committee representing stakeholder interests
Strategic Company concept
Strategic Company (State Owned Enterprise) as master
developer, funding vehicle, general contractor
GOI backed funding (on-lending, direct loans, guarantees,
VGF) of:
Sea dike, Pumps and Lock
Land reclamation (partially)
SC finances from mixed cash flow (land sales and –lease,
toll and fare-box) and delivers through PPP and B2B
schemes:
land reclamations,
toll roads and MRT
repayment of loans
Private sector can participate (?)
Strategic Company (Stage B & C)
Contract with/ mandate from Implementing Body
Optimizing between components towards the objectives
of the company and the public interest
Value creation through integrated planning of
components and drive for revenue creation and cost
reduction
Regular sovereign financing through on-lending, SOE
lending and corporate finance of the development
company and project finance in PPP schemes.
Mixed SOE and private funding with optimized revenue-
cost balance.
 NCICD Strategic Company
• The SC is the Commercial Entity to plan, finance and procure
feasible program components. It is a State owned Enterprise,
controlled by and reporting to the Implementing Body.

Functions:
• Develops investment packages and prepares investment proposals
for approval by the IB
• Manages several funding sources and flows of funds under control
of the IB
• Manages inter-project flow of funds for optimal cross subsidization
of project components
• Enables various private sector involvement modalities under one
umbrella (transaction flexibility)
• Performs roles as shareholder, GCA, concessionaire and executing
agency
• Pursues “Value for Money” principle, optimizing costs and revenue
over the entire life cycle of assets
 Legal basis
The legal basis of the DA is at the same level with Ministries,
Institutions and Regional Government, and consists of:

• PERPU (Regulation in stead of Law) for the Development Authority

– Declaration of emergency situation for the National Capital
– Temporary: will be in place until final legislation (UU)
– Justification of extraordinary and urgent measures (not business
as usual)
• PERPRES
– For the establishment of the organization and procedures within
the Development Authority, especially the Steering Commitee
and the Implementing Body
• PP (Government Regulation)
– For the establishment of the Strategic Company as BUMN (by
MoF)
 Steering
Policy
NCICD Committee
Development Body
Implementing Regulation
Body

Strategic Funding &

Company Execution

Land Infrastructure Dikes

Component 3
Component 1 Component 2
etc.

Implementation
 NCICD Institutional setup

Steering NCICD Development

Committee Authority

Established by PERPRES
Steered by Master Plan
Implementing Emergency procedure
Streamlining policies Body Delegated authorities (to be
Synchronization (regulator) specified)
Professional staff
Deal with private business
Funding Development Steered by Business Plan
Company (SOE) Corporate/Public
procurement policy

Contracts

Project Project Project Implementation

SPV Project
(Private) (ROE)
Project Companies(private)
 NCICD Strategic Company
Three roles
Concessionaire Contracting
Three Execution
(B2B) (PPP) (conventional)

Land Development Transport/ Access Safety & Environmental

Tail, Lagoon
Body + Deep Toll Urban Stage A Stage B Pumps Sewerage
Wings…x MRT Operation
Land side seaport Road Road Dikes Seawall & Locks &
(raw
islands Sanitation
water)

Bundling & cross funding

 NCICD Development Company

Execution
Start small?

Safety & Environmental

Stage A Sewerage
Stage B
Dikes &
Seawall
Sanitation
Managing the implementation stage
Steering Committee
NCICD Development Body
Implementing Body

Strategic Strategic
DKI / PAM
DKI & PU DKI/PU Company Company
Jaya (SOE) (SOE)

Sanitation & Water

Stage A Stage B Stage C
Sewerage supply

Strategic Company: Business

Synchronised Implementation agreement, planning &
Case, Funding and Selection of
monitoring framework
private partners
 Indicative key decision making agenda
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2030-2050

Formation of PMU
Adoption of MP Implementation Model
Adoption of NCICD Master Plan & Delivery Model
Start Implementation of short term measures (stage A dike) + O&M arrangements
Revision of Spatial Plan Jabodetabekpunjur (Perpres 54/2008)
Establish NCICD Development Body
Revision of RTRW DKI Jakarta 2011-2030
Perpu and Perpres adoption
Start of acceleration measures water quality improvement
Establish Strategic Company
Go no go procurement Stage B
Completion Stage A
Start construction Outer Sea Wall
O&M arrangements dike and lagoon
Close contract pump stations & toll road
Interim decisions Stage B

Moving/develop new fishing port

Moving/develop new Power Plant
Completion of Outer Sea Wall
Stage B pre-closing decision
Stage B closing decision (early)
Stage B closing decision (late)
Go no go Stage C dike
Stage B closing
decision (latest)
Asset Management Stage

TOWARDS SUSTAINABLE OPERATION

& MAINTENANCE
 O&M best practice framework

World Economic Forum

Boston Consulting Group, 2013
 O&M Critical success factors

World Economic Forum

Boston Consulting Group, 2013
Asset Management Stage
Existing or new AM organization?
dam operation,
lagoon water level
Lagoon water quality management,
pumping regime
Etc.
Source of operational budgets?
New & specific taxation or levy system possible, or adapt
existing tax system?
Outsourcing (O&M company) & types of contracts
Roles in Asset Management

Asset Owner Sets the goals/ objectives

Delivers the objectives, prioritises

Asset Manager
activities based on risks

Service Provider
Executes the activities
Asset Management Hierarchy

Investment
Plan

Minor/major
assets

Asset Management Plan

(replacement, upgrades)

Asset register
(location, type, condition)
NCICD Asset Management function
Asset Management Body

Safety
Cost Monitoring &
Systems
Recovery Evaluation
management

O&M
O&M O&M
Sea and River
Lagoon Pumping Stations
Dikes
COMMUNICATION & CONSULTATION
Communication Strategy
Synchronized plans Positive business cases &
and budgets private sector involvement

Government Private sector

Government Other Financiers Investors & Supporting
in PMU government Developers companies

NCICD
Civil society General public
Affected Media Parliament Legal
NGO’s Universities
communities & Politicians & Law

Support and constructive Approval and legal

criticism & inputs compliance
NCICD key messages
“Turning threats into opportunities”
Top 5 challenges
1) Restore ecological balance
2) Create water safety (drinking water, flood safety, surface water quality)
3) Create space for revitalization of the area: reverse the trend of congestion, stagnation and withdrawal
4) Create conditions for improved quality of life for all inhabitants
5) Improve access to the area for the movement of people and goods.

Strategic direction: Create Space offshore: How?

• For water • By moving North: reclaim land from sea, build dikes,
• For people create connections
• For transport connections • By following an integrated approach: on-land and
• For economic activities offshore measures are balanced
• For urban development • By careful planning and commitment
• For ecological restoration • Through investments: private and public
• By collaborative management

Observe Three Overarching Principles

1. Remediation: reducing the pollutant load of the ecosystem and stop land subsidence
2. Sustainability: maintain balance between environmental quality, economic viability and socio-cultural
well-being
3. Partnership : strategic partnering between stakeholders to achieve beneficial objectives
 Communication Road Map Ground
breaking
Master Plan
Complete
Sept 2013 Dec April July Dec 2014
Implementation Project
Project Preparation
model Implementation

Communication Awareness Sense of urgency Sense of ownership

objectives

Information Common ground on

Directions for solutions, Conditions for Progress imlementa-
demands challenges, need for
opportunities and short implementation, PPP tion, operation and
measures,
term measures arrangements, funding maintenance
organization

General Website
communication
Media Media Media Media Media Media
activities
release release release release release release

Public
event
Online multi media: www.ncicd.com
KNOWLEDGE & CAPACITY
DEVELOPMENT FOR NCICD
Capacity Development in NCICD
Capacity Development is focused on three levels:
individual, organizational and policy level.

• Strategies &
priorities
Policy • Regulatory
framework
• Systems &
procedures
Organization • Structure & culture
• Resources

• Knowledge &
Individual experience
• Skills & attitudes
KCD focus

Policy Level: Focus on policy instruments,

Implementation & funding arrangements & stakeholder
management
Organizational level: Focus on capabilities of
implementing body and program delivery units
Individual level: Focus on capacities of government
officials and staff of implementing body
KCD process

SC SC SC

Asset
PMU IMPLEMENTING Manag
Body Body

KCD Inputs
2013 2030
2014/15
KCD Menu
International study tours and site visits
International High-level Review Panel meetings
Individual peer reviews
Seminars and conferences
Master Classes
Short, tailor-made courses
On-the-job training
Apprenticeships/internships
K-networks and Learning communities
Applied research
Capacity development requirements
• Managerial Capacity: the capacity to plan and oversee
project implementation from planning, quality, money and risk
point of view
• Technical capacity: the ability to deliver sustainable and
safe technical solutions that will support NCICD’s safety and
economic development objectives
• Entrepreneurial / Commercial Capacity: the ability to
enhance the value of the project through reduction of costs
and risk and increase its development – revenue potential
• Financing Capacity: the ability to attract funds to implement
the assigned scope at reasonable cost
• Procurement / Negotiation Capacity: the ability to prepare,
procure and manage an array of state-of-art delivery models
and partnerships, including risk assessments, Value for
Money assessments etc.
KCD Road Map 2014
PROPOSED BUDGETS 2014-2015
NCICD Budget proposal 2014
Allocation International
Component Amount APBN/APBD funding
Development Authority
A0 PMU $ 633,327 $ 633,327
A1 DA Honoraria $ 632,000 $ -
A2 DA Office Costs $ 127,000 $ 72,000
DA Support
B1 Consultation & Communication $ 345,000 $ 95,097
B2 Knowledge and Capacity Building $ 1,058,532 $ 338,532
B3 Peer review $ 65,000 $ 2,695
B4 Strategic support $ 1,650,000 GON?
B5 Technical Support $ 2,166,250 GON?
B6 Investment & PPP arrangements $ 4,416,250 GON?
No regret Measures
C Stage A Development $ 11,000,000 $ 11,023,108
D Stage B&C Development $ 3,982,476 $ 2,217,237 GOK?
E Land subsidence $ 1,596,715 $ 1,457,133
F Water quality improvement $ 5,180,345 $ 4,082,632 JICA?
Total 12 months $ 32,852,894 $ 19,921,759 $ -

Gap $ 12,931,135
Category Nr. Components Proposed Budget Budget proposal 2015 (APBN/APBD) International
NCICD 2015 CMEA PU DKI Finance
PMU A0 PMU Secretariat
Coordination activities $ 60,000 $ 60,000
Institutional development, incl. $ 240,000 $ 90,000 $ 75,000 $ 75,000
Meetings $ 9,000 $ 9,000
Total PMU $ 309,000 $ 159,000 $ 75,000 $ 75,000 $ -
NCICD A1 DA Honoraria
Development Steering Committee $ 54,000 $ 54,000
Authority (DA) Executive Board $ 103,000 $ 27,000 $ 38,000 $ 38,000
Strategic Company management $ 80,000 $ 80,000
Strategic Company staff $ 150,000 $ 150,000
Sub total $ 387,000 $ 81,000 $ 38,000 $ 268,000 $ -
A2 DA Office costs
Office rent $ 72,000 $ 72,000
Office equipment & furniture $ 100,000 $ 18,000 $ 40,000 $ 40,000
Office running cost $ 60,000 $ 18,000 $ 24,000 $ 24,000
Transportation $ 60,000 $ 9,000 $ 24,000 $ 24,000
Sub total $ 292,000 $ 45,000 $ 88,000 $ 160,000
Total DA costs $ 679,000 $ 126,000 $ 126,000 $ 428,000 $ -
Strategic B1 Setup of Strategic Company (Capacity Development)
Company Project & Program management $ 25,000 $ 25,000
establishment Corporate Services function $ 25,000 $ 25,000
& support Procurement function $ 25,000 $ 25,000
Business Development function $ 25,000 $ 25,000
Engineering function $ 25,000 $ 25,000
HR and legal function $ 25,000 $ 25,000
PR& Communication function $ 25,000 $ 25,000
Finance function $ 25,000 $ 25,000
Sub total $ 200,000 $ 75,000 $ 25,000 $ 100,000 $ -
B2 Knowledge Development & Exchange
International exchange $ 150,000 $ 30,000 $ 60,000 $ 60,000
$
Seminars & conferences (in Indonesia) 100,000 $ 15,000 $ 40,000 $ 40,000
Sub total $ 250,000 $ 45,000 $ 100,000 $ 100,000
B3 Strategic support
Business development & program
governance support $ 750,000 $ 750,000
Technical support $ 750,000 $ 750,000
Sub total $ 1,500,000 $ 1,500,000
Total DA support $ 1,950,000 $ 120,000 $ 125,000 $ 200,000 $ 1,500,000
Category Nr. Components Proposed Budget Budget proposal 2015 (APBN/APBD) International
NCICD 2015 CMEA PU DKI Finance
Stage A C1 Implementation stage A
Development Construction current sea wall - public/private261,550,000
$ $ 261,550,000
Construction river embankments $ 162,345,000 $ 162,345,000
Construction new pumping stations $and locks294,000,000 $ 294,000,000
$ 717,895,000 $ - $ 456,345,000 $ 261,550,000 $ -
C2 Resettlement
Communication $ 250,000 $ 250,000
Social safeguard study on resettlement
$ of population
250,000
on river embankments $ 250,000
Relocation/Resettlement/Landacquisition
$ 97,800,000 $ 97,800,000
Sub total $ 98,300,000 $ - $ - $ 98,300,000 $ -
C3 Additional Technical Surveys
Topographical survey (40x12.5km) $ 1,000,000 $ 1,000,000
Survey Existing Embankment Levels$(remaining embankments)
500,000 $ 500,000
Hydrological Survey $ 500,000 $ 500,000
Sub total $ 2,000,000 $ - $ 500,000 $ 1,500,000 $ -
C4 Technical assistance
International Support technical implementation
$ 2,225,000
stage A $ 2,225,000
Communication and consultation $ 200,000 $ 40,000 $ 80,000 $ 80,000
Sub total $ 2,425,000 $ 40,000 $ 80,000 $ 80,000 $ 2,225,000
Total Stage A $ 820,620,000 $ 40,000 $ 456,925,000 $ 361,430,000 $ 2,225,000
Stage B & C D1 Detailled studies stage B + C
Development Land reclamation as base for OSW $ 500,000 $ 500,000
Multi modal transport & network study$ 500,000 $ 500,000
Toll roads pre-feasibilitystudy $ 300,000 $ 300,000
Spatial Planning $ 200,000 $ 200,000
Pre-feasibilitystudy Deep sea port-industrial-logistics
$ 300,000
cluster $ 300,000
Detailed legal preparation for concession
$ contracts
2,000,000 $ 2,000,000
AMDAL and environmental studies $ 1,000,000 $ 1,000,000
Hydraulic studies (inflow lagoon) $ 500,000 $ 500,000
$ 5,300,000 $ - $ 2,000,000 $ 3,300,000 $ -
D2 Technical surveys
Bathymetric survey (60 km x 20 km) $ 500,000 $ 500,000
Geotechnical surveys Outer Sea Wall$ and land reclamations
2,800,000 $ 2,800,000
Sub total $ 3,300,000 $ - $ 500,000 $ - $ 2,800,000
Total Stage B & C $ 8,600,000 $ - $ 2,500,000 $ 3,300,000 $ 2,800,000
Category Nr. Components Proposed Budget Budget proposal 2015 (APBN/APBD) International
NCICD 2015 CMEA PU DKI Finance
Reduction of E1 Monitoring land subsidence
land Reduction ground water extraction pilot
$ 300,000 $ 300,000
subsidence Geotechnical research (existing monitoring
$ wells)240,000 $ 240,000
Monitoring reduction ground water $extraction (subsidence
600,000 study/borings) $ 600,000
$ and satellite
Subsidence monitoring (combined Insar 1,000,000
images) $ 1,000,000
Total land subsidence $ 2,140,000 $ - $ - $ 2,140,000 $ -
Water quality F1 Water quality improvement
improvement Additional monitoring water quality$improvement500,000
rivers $ 500,000
Acceleration study water quality improvement
$ (incl
1,000,000
sanitation) $ 1,000,000
Total surface water quality improvement $ 1,500,000 $ - $ 500,000 $ - $ 1,000,000
TOTAL $ 835,798,000 $ 445,000 $ 460,251,000 $ 367,573,000 $ 7,525,000