toilets, although people prefer to have their individual toilets. community toilets are a good alternative where individual toilets are not feasible, especially in areas subject to frequent flooding, where most residents are tenants or where there are severe space constraints and very densely populated slum areas. in 2008 the health ministry launched a national strategy for community-led total sanitation, emphasizing peer pressure and shame as drivers for rural sanitation instead of public investment. the government's national program for community empowerment (pnpm—program nasional pemberdayaan masyarakat) also has the potential to improve water and sanitation services through block grants, technical assistance and training to communities. however, similar broad programs have in the past only allocated around five per cent of funds to water and sanitation. legal framework relevant laws include law no. 7/2004 on water resources; law no. 22/1999 on local government; law no.32/2004 on regional government; and law no.33/2004 on fiscal balance between the center and the regions. the water resource law aims at integrated and sustainable water resources management and clarifies the responsibilities of the central government as well as provincial and district governments in terms of water resources management, such as the granting of water abstraction licenses. the local government law was a landmark in terms of decentralization in indonesia after the fall of suharto, making the previous rhetorical commitment to decentralization a reality by transferring all powers except certain specifically enumerated powers to local government. the fiscal balance law greatly increased the revenue base for local government. relevant implementing regulations include government act no.16/2005 "on the development of the water supply system", which allows private sector participation in water supply; two decrees by the ministry of public works from 2006 and 2007 to establish a national water board; and the ministry of home affairs decree no. 23/2006 on guidelines for water tariff setting. the latter stipulates that tariffs should fully recover costs including a rate of return of 10 percent. the decree no.47/1999 of the ministry of home affairs on guidelines for evaluating the performance of water service providers (benchmarking) has now lost some of its teeth because of the subsequent decentralization policy. decrees by the ministry of health as well as the ministry of industry and trade regulate the quality of bottled water, as well as for water kiosks that refill large water bottles. urban areas the provision of water services in urban areas is the responsibility of pdams (perusahaan daerah air minum), local government owned water utilities. there are 319 pdams in indonesia. two (jakarta and north sumatra) operate at provincial government level. all others operate at district government level, meaning at the level of a regency (of which there are 349) or a city (of which there are 91) (see list of regencies and cities of indonesia) most pdam are very small, with less than 10 000 connections: only four per cent have more than 50 000 connections. institutional responsibility for wastewater and sewerage is at the district government level; departmental responsibility varies between districts. very few urban utilities provide sanitation services. sanitation utilities are called pd-pal or local government owned wastewater utilities. some smaller pdams have associated themselves under public-private partnerships. the first such partnership was created under the provincial government of north sumatra in 1999, involving six pdams led by the utility in tirtanadi. another partnership of 11 pdams was established in eastern indonesia together with the dutch water company wmd. as of 2011, 29 localities had signed contracts with private companies to operate, and sometimes also to finance, their water infrastructure. the largest contracts are two concession contracts in jakarta (see water privatization in jakarta). most other contracts are relatively small with water sales of less than 100,000 cubic meter per day. in some cases they are management contracts without investment responsibilities, such as in panaikang-massakar in sulawesi. in many cases, the private companies also partly finance infrastructure, such as a water treatment plant, under build operate transfer contracts. this is the case in medan in north sumatra and bandung in west java. the private partners are mostly indonesian companies, such as the property developer bakrieland or the water company acuatico, or foreign companies such as the singapore-based engineering company moya asia. the central government promotes public-private partnerships in water supply through guarantees and partial subsidies. however, as of 2011 many ppp projects had to be cancelled because of the difficulty of negotiating the terms between the central, regional and local governments. utilities are associated in perpamsi, the national association of water utilities created in 1972. the association has 394 member companies that serve 24% of the population of indonesia. in 2003 perpamsi initiated a performance benchmarking program with support from the world bank. the data base currently contains 115 water utilities (pdam) in indonesia, including most of the larger ones. rural areas springs, such as this one in batu karut in the sukabumi regency on java, are an important source of water in rural areas of indonesia rural indonesia has a long history of community-managed water supply services using naturally occurring springs, rainwater and groundwater sources. however, community capacities to sustain such water systems over long periods have tended to be limited. past rural water supply and sanitation projects have often not invested sufficiently in building community capacity to plan, implement, operate and maintain services in ways that benefit and satisfy all sections of rural societies, conditions necessary for service sustainability. rural consumers have not consistently been offered voice and choice in decisions related to establishing and managing services and paying for them. services have often been provided in a top-down manner by agencies external to the community, using public sector or donor funds and contractors answerable to government agencies rather than to the users of services. this has led to mismatches between what the users want and get, a lack of community ownership of rural water supply and sanitation facilities and unclear responsibilities for maintenance. in 2003 the government endorsed, but did not adopt a national policy for the development of community-managed water supply and environmental sanitation facilities and services that provides a road map for sector reform, by: changing the policy goals for the sector, from achieving "coverage targets" counted in terms of construction of systems facilities, to the twin goals of sustainability and effective use of water supply and sanitation services; espousing strategies such as empowerment of communities to choose, co-finance, construct and manage and own their water systems; requiring the use of gender-and poverty-sensitive approaches in working with and empowering user communities to ensure poverty targeting and impact on local poverty; building stakeholders' understanding at all levels concerning service sustainability; measuring success in terms of sustained population access to services, and effective use of those services, i.e. hygienic and health - promoting use of services by all sections of communities and improved sanitation and hygiene behaviors among various age-sex groups of the population. the community participation and cost recovery under the new approach has led to greater sustainability of services. for example, an evaluation of a rural water supply and sanitation project supported by the asian development bank that did not yet use the new approach revealed that less than four years after project completion, only 30 per cent of the water supply facilities and 30 per cent of sanitation facilities constructed by the project were still functioning. however, according to a ministry of health report that reviewed the functionality of water infrastructure in five districts that had implemented the world bank-supported wslic project from 2001 to 2006, the average functionality of public taps was 72 per cent. the significant differences in functionality between the adb and wslic activities has been largely attributed to the participation of communities in the construction of infrastructure and the communities recovering monthly fees to cover maintenance costs of water and sanitation systems. however, in peri-urban areas or rural areas that are increasingly absorbed in urban conglomerations, community management alone may not be an adequate arrangement. according to the world bank, newer models of support and responsibility sharing between user communities and local governments or local private sector agencies are needed. civil society civil society groups, both local and international, play a vital role in the sector. some are implementing water and sanitation programs in districts that have not yet received any form of government support in the sector. despite their diversity, most are harmonised in their approach. very few, however, work through government systems. other civil society groups, including religious leaders in village communities, play a significant role in the success of community-based approaches. religious leaders support community cohesion and influence and encourage clean and healthy behaviours to complement water and sanitation infrastructure. history and recent developments the water supply of jakarta has been privatized since 1997 through two 25-year concession contracts the first water utilities in indonesia, called pdam after their indonesian acronym, were set up during the colonial period at the beginning of the 20th century. following independence in 1945 they became part of local government. in the 1970s the central government became more involved in their financing and management. in 1987 a government act nominally handed water supply back to local governments, but in reality central government remained very involved. only after the fall of suharto in 1998 a serious effort at decentralization was made with the local government law of 1999 that effectively handed over responsibility for water supply to local governments. jakarta privatization in june 1997 two 25-year water concessions were awarded without bidding to serve the city of jakarta beginning in february 1998. a subsidiary of the french firm ondeo (now suez), called palyja, was awarded the concession for the western part of the city and a subsidiary of the british firm thames water international called tpj was awarded a concession for the eastern part. policy for rural water supply and sanitation in 2003 the government adopted a national policy for the development of community-managed water supply and environmental sanitation facilities and services that provides a clear route map for sector reform (for details see above). efficiency non-revenue water (nrw) in indonesia's best utilities stands at only 20%, while the worst quartile of utilities participating in perpamsi's benchmarking exercise have nrw of 43%. however, nrw data is generally unreliable as many pdams do not have meters installed to accurately measure nrw. in terms of labor productivity, the best performing utilities have a staff ratio of 4 per 1000 connections, while utilities in the worst quartile have more than 9 staff per 1000 connections. labor productivity for water utilities is considered to be at acceptable levels if it is below 5 per 1000 connections. in jakarta the level of non-revenue water was 51% in 2001, one of the highest levels in indonesia. however, in terms of labor productivity the two utilities in jakarta fare relatively well with only 5.3 employees per 1000 connections. cost recovery and tariffs the ministry of home affairs decree no. 23/2006 sets out a policy of full cost recovery through tariff revenues for water utilities. the decree prescribes an increasing-block water tariff with a first subsidized tariff block for a consumption of up to 10 cubic meters per household, and a break-even tariff for higher consumption. commercial and industrial users can be charged higher tariffs with higher blocks at the full-cost tariff. however, in reality, few utilities recover their costs. according to a 2005 study by the department of public works, most pdams faced financial problems. only about a third increased tariffs between 1998 and 2005. one third of utilities had foreign debt, whose value in local currency increased substantially due to the devaluation of the rupeeh in the 1998 financial crisis. many pdams defaulted on loans they had received from the ministry of finance. as of 2009 renegotiation of these loans (principal, interest and penalties) was still underway, thus cutting off the utilities from new government loans. water sold by vendors is much more expensive than piped water. sometimes water is transported by a bike. according to the asian development bank, in jakarta the average tariff in 2001 (average of residential and commercial users) was us$0.29/m3, compared to production costs estimated at only us$0.11/m3. 98% of revenues billed were collected. according to these figures, at least the jakarta utility managed to recover its costs. since then tariffs have been