Technocratic officials in the central government and their donor supporters have not contested the government’s decision to increase spending on education—indeed, they argued forcefully in the early post-New Order period that the government should spend more on education in order to improve access to and the quality of education and enhance the country’s economic competitiveness (see, for instance, World Bank 1998; Jalal and Musthafa 2001). However, they have queried the efficiency of increased government spending on teachers’ salaries noting that growing teacher numbers has lowered teacher-student ratios to the point where further increases in teacher numbers are unlikely to produce any significant educational gains (World Bank 2013: 101; Al-Samarrai _et al_ 2012; USAID Prioritas 2015). They have also expressed concern about both the fiscal sustainability of further rises in government spending on teacher salaries and the potential for such spending to crowd out other important areas of investment (Jalal _et al_ 2009: 169; Chang _et al_ 2014: 161-162).

With the fiscal implications of these policies becoming increasingly widely recognized, technocratic officials were able to secure a moratorium on new civil service appointments in 2011 in regions where government spending on salaries exceed 50 percent of the regional government budget. Announcing the policy, Finance Minister Agus Martowardoyo stated that: ‘The high share of personnel costs erodes the funding available for capital expenditures. This means we have reduced budgets for social services and infrastructure development’ ( _Jakarta Post_ 2011). This moratorium appears to have remained in place in many regions for several years.

In interviews with various local government officials in District A, District B, and Municipality B—all districts that have been subject to the moratorium—we heard that the moratorium was leading to a sharp reduction in the number of _guru PNS_ within their respective regions and making these regions more reliant upon _guru honor_ to deliver the required number of classes.<sup>19</sup> Indeed, the head of the regional civil service agency in District A declared that his district would be a facing ‘teacher crisis’ in 2019 if the moratorium continued because of the impending retirement of teachers who were recruited in the late 1970s.<sup>20</sup> These teachers—many of whom were employed through the issuance of a presidential instruction ( _inpres_ ) and are consequently referred to as _guru inpres_ —were extremely large in number because their employment was a key part of the New Order’s effort to dramatically expand the school system using proceeds from the oil boom. Their forthcoming retirement is thus expected to lead to a significant reduction in teacher numbers. In two districts—District A and District B—we heard that local education agencies and/or regional civil service agencies were beginning to plan around longer working weeks as a way of dealing with the looming teacher shortage.

The PGRI has made similar claims about a teacher crisis, arguing forcefully that the country in fact is facing a severe teacher shortage (PGRI 2015; _Kompas_ 2015b). For it, the crucial relevant figure is not student-teacher ratios but rather the number of classes ( _rombel_ ) taught by teachers who have not yet been granted civil servant status. Using this basis of calculation, it has argued that the country needs another 400,000 teachers at the primary level alone (PGRI 2015).

Representatives of some regional governments have pushed back against the moratorium suggesting that it is too blunt an instrument for trying to reduce the cost of teachers’ salaries (Boediwardhana 2011). The PGRI has claimed that the moratorium breaches the 2005 Teachers Law to the extent that the law requires the government to fulfill teachers’ needs including in

> 19 Interviews with the Secretary of the District A Education Agency; head of the District B Education Agency; and head of the Municipality B Education Agency.

> 20 Interview, June 2015.

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