Go-Jek and the Government: an unfortunate love-hate relationship

Most Indonesians were caught in shock when yesterday night, the Ministry of Transportation has pretty much decided to ban all car and motorcycle-based ride-sharing services from operating in Indonesia. This was subsequently followed the next morning by the Minister itself apparently lifting the ban.

Behind the decision was a statement from the Ministry of Transportation that reads:

Regarding the rise of app-based services which use private vehicles to carry people or goods, it has to be taken action that its operations are forbidden.

The statement was signed on the 9th of November by the Minister of Transportation, Ignasius Jonan, and called for the police to take further action.

The decision came suddenly, much to the dismay and outrage of Indonesian netizens, including yours truly. Angry tweets were everywhere, it made the morning news, and even someone made a petition for it. What actually caused this decision to come in effect, and where is the reasoning behind this banning?

This article was written partly in response to Tom Pepinsky’s post GO-JEK: from ‘Disruptive Innovation’ to ‘Disrupted Innovation’, while at the same time calling out the lack of logic that has made this decision to come in effect.

Background

The issue that ride-sharing companies like Go-Jek has always been trying to fill the gap in has always been the unfortunate state of public transport systems in big Indonesian cities, especially in Jakarta. On one hand you have all these old buses with no air conditioning, and on the other side you have unorganised motorcycle taxis, called “ojek”.

Two of the most well-known bus companies that operate in Jakarta are Metromini and Kopaja. This is quite a problem, especially when no one really knows who owns Metromini. Whereas Kopaja is starting to fix their services, Metromini is stuck in the cold. Their management is nearly nonexistent, their fleet is aging and close to breaking down, and with a driver pay system known as the “setoran”, where drivers must earn a set minimum of daily income that will be kept by the company. If they’re lucky enough to earn more, that extra income will then go to the drivers themselves.

Which is why you’ll see these buses drive recklessly along the roads, disregarding traffic laws, filling in as much passengers they can to earn a living. It’s no surprise that they got involved in accidents a lot. In fact Metromini themselves contribute to 10% of all public transport accidents in Jakarta.

All of these buses operate under the flag of Organda, the organisation representing all public transport services, like buses, minibuses and taxis.

On the other side, you have motorcycle taxis called ojeks. They also contribute to their own set of issues, mainly with price gouging. No matter how near or far the ride’s going to take, they will put up an imbalanced price tag. An ojek driver could just put up a IDR 50,000 price tag just for a ride within the same district. Moreover, they behave like most motorcycles do, zig-zagging through the traffic, ignoring traffic lights and road markings.

The lack of trust by the people, thanks to the carelessness of these public transport systems, make it one of the least trusted organisations in the country. Which is why people tend to keep using private vehicles, and unfortunately with the number of private vehicles rising exponentially every year, it will surely grind big cities like Jakarta to a halt in a few years.

This is where app-based ojek services like Go-Jek step in, bringing a more organised structure to the disorganized and unregulated market of ojek drivers1. They try to eliminate the core issues of being in an ojek, by putting their drivers through background checks, then providing them with all the amenities, like helmets and face masks, and they also imposed a balanced profit-sharing system, based on the distance of a ride.

Where’s the logic?

From all the information I’ve gathered, the logical reasoning behind this banning is illogical at best. The Ministry of Transportation have made a number of claims and reasoning on why they went with banning all motorcycle-based ride-sharing services, and a representative from the Ministry had a talk with a local TV station earlier, which I’ve collected some of their points earlier.

There are, however, two of their points that I strongly object.

“Motorcycles are not supposed to be used as a form of public transport.”

Now, if it were supposed to be like that, then you should’ve clamped down on Go-Jek, and all other ojek services from the start. This delayed and vague response is not helping anyone, and just causes a lot of confusion among people.

“Security is the primary concern”

You keep saying that as more and more people are dying from the recklessness of Metromini drivers. People are worried about their safety inside these so-called “rollercoasters of the road”, and you had the balls to ban those who try to make everyone much safer?

Maybe try to fix your public transport system first, then we’ll talk again.

Disorganised government, and possible lobbying

This decision also came along months after president Jokowi invited2 a bunch of Go-Jek, and all other ojek drivers to a dinner showing full support of the new economy. And a month after that, the owner of Go-Jek was invited to Silicon Valley along with Jokowi himself for a state visit.

The fact that this happens after the President shows full support of the new app-based ride-sharing business that is currently on the rise in Indonesia, is inconceivable. It only shows how disorganised our government is. Most of us aleady know that our government is highly corrupt, runs on an archaic bureaucracy system, and as of now has pretty much been dumbed down to squabbling between oppositions, instead of working for the people. So this is really just a tip of the iceberg.

And for an icing on the cake, the statement was also apparently CC’d to the head of Organda, so some people have been speculating that the Organda was part of the lobby, because the Organda has been known to be lobbying against these ride-sharing apps.

The aftermath

As of now, what happens after all this kerfuffle remains unclear. People, of course, were pissed. The President himself has stated that he’ll “contact the Ministry of Transport immediately”. The National Consumer Protection Agency (BKPN) has criticised the decision, stating that the decision was “premature” and they went further by stating that “ojeks are actually protected and recognised as a business field according to the National Statistics Agency (BPS)”.

There also have been words that the Minister of Transportation has pulled a 180 and lifted the ban. I’m currently still trying to verify this, but as Jonan stated in the article, “If people still want to use these as an alternative until our public transport improves, then go ahead.”

As for the current state of our public transport, as long as it remains however it is right now, it is safe to say that we will still need these alternatives for quite a while.