Indonesian Stock Market » Good Governance

RI on verge of major transparency initiative

Cempaka — Wed, 08 Sep 2010 09:16:00 +0000

The Jakarta Post, Jakarta | Wed, 09/08/2010 9:14 AM

Indonesia has fulfilled all requirements to apply for the Extractive Industries Transparency Initiative (EITI), with the recent appointment of three regional secretaries from oil, gas and mining regions.

The initiative is the product of a multi-party international consensus between governments, extractive industries and civil societies to boost cash flow transparency in the extraction industries.

“All that Indonesia needs to do now is submit a formal letter signed by Coordinating Economic Minister Hatta Rajasa,” David W. Brown, a senior EITI adviser in Indonesia said.

He added that the three regional secretaries from East Java, East Kalimantan and Riau, including officials from various directorate generals connected to the mining industry, would represent the Indonesian government.

Representatives from civil society members and extractive company associations — including the Indonesian Coal Mining Association, Indonesian Mining Association, and Indonesian Petroleum Association — were also part of the Multi-Stakeholder Group, he said.

He said that although Hatta had not signed the formal request for candidacy since the team was formed in July, the elapsed time still fell within reasonable limits. “No expiration date exists for the requirements that have been submitted,” he said.

Ridaya Laodengkowe, an activist from Publish What You Pay, said that it would be advisable for the letter to be sent before the Idul Fitri holidays because the EITI board would enter a meeting session toward the end of September.

“We are hoping that the letter will be sent soon since the EITI board members are those who will decide about Indonesia’s candidacy,” he said, adding that two years had passed since activists campaigned for the importance of EITI candidacy among the extractive industries society in Indonesia.

The lengthy time span for meeting candidacy requirements, he said, was partly caused by the government’s difficulty in deciding on which of their agencies would represent oil, gas and mining districts.

Rezki Sri Wibowo, deputy executive director of Transparency International Indonesia, said that certain people considered EITI an internationally imposed initiative and resisted it as a result.

“Indonesians have a nationalistic sentiment toward the oil and gas industry, which they say is connected to security issues,” he said.

Ridaya said the government finally showed commitment to forward Indonesia’s candidacy in the initiative because they “saw a local and global demand for transparency”.

“They felt it especially when the Wall Street reform was widely discussed, in which increasing the transparency of extractive industries became part of the draft’s agenda,” he said.

The Dodd-Frank Wall Street Reform and Consumer Protection act in the US requires oil, gas and mining companies under the US Securities and Exchange Commission to publish their income, tax payment and royalties to host countries and the US government. (gzl)

RI one of Anticorruption Academy founders

Cempaka — Wed, 08 Sep 2010 07:26:00 +0000

The Jakarta Post, Jakarta | Wed, 09/08/2010 9:16 AM

JAKARTA: Indonesia has become a signatory for the establishment of the United Nations’ International Anticorruption Academy in Vienna, Austria together with 29 countries.

“We hope the government will ratify the agreement soon,” Corruption Eradication Commission (KPK) deputy chairman Haryono Umar said Tuesday.

He added that the academy would be open to anticorruption practitioners at public as well as private institutions at the local and regional as well as international levels.

Launched on Sept. 2 by UN Secretary-General Ban Ki-moon, the academy is a joint initiative by the Austrian government, the UN Office on Drugs and Crime, and the European Anti-Fraud Office and will come into full operation next year.

It is earmarked as a pioneering institution that aims to overcome current shortcomings in knowledge and practice in the field of anti-corruption.

It will function as an independent center of excellence in the field of anticorruption education, training, networking and cooperation, as well as of academic research, the academy says on its website, www.iaca-info.org. — JP

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Cabinet to be reshuffle in October, Gerindra executive

Cempaka — Tue, 07 Sep 2010 12:10:00 +0000

Antara News, Tuesday, September 7, 2010

Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono is to reshuffle his cabinet in October this year, a senior Greater Indonesia (Gerindra) Party official said here Tuesday.

"Yes, it`s true. I have heard there will be a cabinet reshuffle this year," Ahmad Muzani, Gerindra Party secretary general, told reporters in Jakarta.

He said, in October 2010, the present cabinet would be exactly one year old, and the President would then be able to review the peformance of his assistants, reconsider their capacity and competence and decide whether or not to keep them.

Muzani said he had received the information on an impending reshuffle from a politician in the government coalition.

The performance of the second United Indonesia cabinet, according to Muzani, was worse than the previous cabinet`s. There was little, if any, coordination among the different ministries.

"This cabinet has not performed maximally in all sectors. The previous cabinet was better although the political situation now has remained stable," Muzani said.

Citing an example, he said there was no coordination between the ministry of defense and the ministry of maritime affairs and fisheries when the Bintan border incident happened last August 13.

"The problem is there is little or no coordination. This was also evident when Indonesian fisheries officers arrested seven Malaysian fishermen who were poaching in Indonesian waters. I think, we have to rediscuss it all," the Gerindra executive said.

In the economic field, the real sector had until now remained in the doldrums and become weak.

"The main thing in the economic field is the real sector. If this sector is not moved, the entire economy is constrained and the people`s purchasing power will drop," he said.

Asked which of the cabinet ministers deserved to be replaced, Muzani did not give a

direct reply. "I do not know about this, which cabinet members need to be replaced," he said.

Previously, Ahmad Mubarok, a member of the executive board of the ruling Democrat Party, had told the press the President would reshuffle his cabinet this year.

Over Half of Graft Suspects Beat the Rap

Cempaka — Sun, 05 Sep 2010 19:30:00 +0000

Jakarta Globe, Anita Rachman | September 06, 2010

The Corruption Eradication Commission building is shown in this file photo. Indonesia Corruption Watch data showed that 54.8 percent of defendants facing charges of corruption in regular courts ended up walking free. (SP Photo)

Jakarta. New research by a prominent watchdog reveals an alarming trend in the fight against graft, showing that well over half of corruption suspects tried in court in the first half of the year were acquitted.

Released on Sunday, Indonesia Corruption Watch data showed that 54.8 percent of defendants facing charges of corruption in regular courts — including district or municipal courts, the Court of Appeal and the Supreme Court — ended up walking free. Of those who were convicted, 8 out of 10 received sentences under five years.

“This is an indication of how our courts do not show seriousness in punishing corruptors — 54 percent is a huge number,” said Donal Fariz, an ICW law researcher and head of the watchdog’s court monitoring division.

The first six months of the year saw 166 graft defendants tried in 103 cases in various courts, with district courts handling 82 cases, he said. Bureaucrats topped the list of defendants, followed by lawmakers and counselors, local government officials, teachers, lecturers and a former minister. Cases largely involved school and local government spending.

“We need to watch our appellate courts, because their trend is pretty different from our antigraft court’s,” Donal said, adding that in 17 cases handled by the Anti-Corruption Court over the same period, no defendants were acquitted.

Alongside the 54 percent of defendants acquitted, the data shows that 22.9 percent of defendants were jailed for up to two years, and 18 percent for two to five years. The average sentence was 12 to 13 months.

“These acquittals build an atmosphere that makes this country a haven for corruption,” Donal said. “The president and the House of Representatives should seriously look at this situation and structurally lead the eradication of corruption in both governmental and legislative bodies.”

ICW data also shows that from 2005 through July this year, 857 corruption cases involving 1,965 defendants were heard in court. In these cases, 49.5 percent of the defendants were acquitted. The strictest year was in 2005, when appellate courts had a 22.2 percent acquittal rate.

The strength of the nation’s battle with corruption has been in question recently, as many graft convicts have enjoyed clemency and sentence reductions.

The National Mandate Party’s (PAN) Tjatur Sapto Edy, the deputy chairman of House Commission III, which oversees legal affairs, has called for corruption convicts to be banned from receiving clemency or sentence cuts.

Another commission member, the Golkar Party’s Nudirman Munir, said the House saw the acquittal rate as a serious problem.

“We want to give the Judicial Commission more authority, so it can examine and take action on cases that run against the sense of justice,” he said.

He vowed that a revision to the law on the Judicial Commission was on the House’s list of priorities to tackle this year.

Legal expert Topo Santoso, from University of Indonesia, warned that strengthening the Judicial Commission should not be the first priority. He said police and prosecutorial offices handling the cases should also be examined. An acquittal was not a decision that depended on the judges alone, he said, but on every institution involved in the prosecution. Each agency had a responsibility to contribute to the success of the courts, he said.

“What if the police dossier is weak?” he said. “The police are the gateway to criminal justice. If we haven’t succeeded in wiping corruption out of that institution, don’t expect our courts to succeed.”

KPK seizes N.Sumatra governor’s Jaguar

Cempaka — Fri, 03 Sep 2010 07:44:00 +0000

The Jakarta Post, Jakarta | Fri, 09/03/2010 8:40 AM

The Corruption Eradication Commission (KPK) confiscated a luxury car it believed was purchased with money stolen by North Sumatra Governor Syamsul Arifin, whom it has named a suspect in a multi-billion rupiah graft case.

The light blue Jaguar was confiscated from Beby Ardiana, Syamsul’s daughter.

“We suspect that the car was purchased with money that Syamsul illegally earned,” KPK spokesman Priharsa Nugraha said.

Syamsul was accused of embezzling state money while he was regent of Langkat in North Sumatra from 2000 to 2007.

“Beby came to hand over the car at around 7 a.m.,” Priharsa said.

Beby, the operational director of PT Lembu Andalas, surrendered the car a day after she was questioned by the KPK as a witness in her father’s case.

The 2003 Jaguar was purchased for Rp 600 million in 2004. It will now be stored at the state-run Deposit and Confiscation House in Cipinang, East Jakarta.

The KPK named Syamsul, who is also a member of the Regional Representatives Council (DPD) representing North Sumatra, a suspect in the case in April this year.

The alleged graft was uncovered by the Supreme Audit Agency (BPK) following its audit on the financial report of Langkat regency.

The report, released on March 16, 2009, pointed at alleged misappropriation of funds from the regency budget between 2000 and 2007, which resulted in Rp 102 billion in losses to the local administration.

The losses were caused by unaccounted funds spent on projects that were not included in the local administration’s budget. Among the large spending was Rp 21.5 billion that the regent claimed was allocated for the activities of some “working units”.

The Langkat administration reportedly collected money from companies, much of which was diverted for personal use by local officials.

Some groups filed reports with the KPK on June 13, 2009, and the KPK began investigations on July 14, 2009. So far, Syamsul has returned Rp 67 billion of the money to the state. However, the KPK is continuing its investigations on allegations that he violated the corruption law. (lnd)

Surprise! Poll Says Most People Don’t Like Lawmakers

Cempaka — Wed, 01 Sep 2010 21:44:00 +0000

Jakarta Globe, Armando Siahaan | September 02, 2010

Jakarta. A survey released on Wednesday by a political research institution confirmed what many already believe to be true: that the public sees current lawmakers as having poorly executed their functions and are demanding more than they deserve.

“The current lawmakers are more popular than the previous working period, but the public perceives them as being worse in terms of their performance,” said Yunarto Wijaya, a political analyst from Charta Politika, which conducted the survey.

The survey found that 63.7 percent of the 378 respondents consider the 2004-09 lawmakers as better than the current ones.

More than 55 percent said the current group of lawmakers was more prominent — but not for good reason. More than 50 percent of the respondents also said the House failed to carry out its three main functions.

Only 22.4 percent of the respondents agreed that the House had done a good job on passing bills, reflecting the worrying fact that the House had only passed seven bills out of the ambitious initial target of 70 for the year.

Moreover, only 22.8 percent believed that the House had done a good job on budgeting, while 52.1 percent thought that the lawmakers have failed in supervising the government.

On the controversial new Rp 1.3 trillion ($144.3 million) House building, which may include a recreational room with spa and fitness center, a staggering 80 percent of the respondents said lawmakers did not need it to improve their performance.

About 78 percent did not see the need to increase lawmakers’ salary, while 61.7 agreed that the lawmakers did not need to go abroad for comparative studies.

“Most of the respondents deemed plans or policies on a salary increase, the new building and comparative studying abroad as negative,” Yunarto said.

On the issue of chronic absenteeism, 84 percent agreed that frequently absent lawmakers should be fired.

Based on the survey and a separate media analysis by Charta Politika, the image of the lawmakers in the past several months has been influenced by a number of issues, including the long-running Bank Century scandal, the high rate of absenteeism, the controversial pork-barrel fund and construction of the expensive new building.

Consequently, Yunarto said that the current legislature’s performance was perceived poorly not only because “the lawmakers have failed to achieve an optimal performance, but that their constant appearance in the media frequently ended up in a coverage with a negative tone.”

Priyo Budi Santoso, the House deputy speaker from the Golkar Party, said that the media coverage on the legislature tended to be one-sided, reporting only the negative, controversial issues, but never the positive side.

He said the media had only been harsh on the legislature, but not the executive government.

“I challenge the media to be critical of the legislature, but also the executive government,” Priyo said.

Pius Lustrilanang, a lawmaker from the Great Indonesia Movement Party (Gerindra) and the head of the Household Affairs Committee, said the struggle for the House to fix its image was particularly difficult because it did not have an embedded public relations function.

Representatives have claimed that measures taken to make them attend plenary sessions are "unfair'. (Antara Photo/Widodo S Jusuf)

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Indonesian President Pledges Police Reform

Cempaka — Tue, 31 Aug 2010 13:07:00 +0000

Jakarta Globe, August 31, 2010

Jakarta. President Susilo Bambang Yudhoyono promised on Tuesday to replace Indonesia's much-maligned chiefs of police and prosecutors but denied the reshuffle was linked to corruption and incompetence.

President Susilo Bambang Yudhoyono, in this file photo,
pledged on Tuesday to replace the chiefs of police and
prosecutors but denied that the moves were political.
(Bloomberg Photo/Ian Waldie)

His comments to cabinet ministers came as businessman Anggodo Widjojo was sentenced to four years in jail for attempting to bribe anti-graft investigators with the alleged backing of top police and prosecutors.

The case shocked the nation when it broke last year but it was far from an isolated incident, with reports of alleged judicial graft and misconduct filling the pages of the newspapers on a daily basis.

Yudhoyono said the law enforcement agencies needed to be professional and "fair", and called for any official found to be involved in wrongdoing to be punished.

"If any police members or prosecutors are involved in any violations, measures should be taken against them according to the law with transparency and high accountability," he said.

National police chief General Bambang Hendarso Danuri and Attorney General Hendarman Supandji would be replaced along with the head of the armed forces as part of a scheduled reshuffle, he said.

"These officials will end their terms in line with the existing law," he said, adding that he was "not pleased" by suggestions the changes were political.

The reshuffle is expected to take place in October and speculation is mounting about who will take over the embattled institutions.

Yudhoyono has won two elections on the back of promises to stamp out chronic corruption but his reform efforts have stalled amid opposition from vested interests including lawmakers and police.

Agence France-Presse

President proposes Bambang, Busyro as KPK leader candidates

Cempaka — Tue, 31 Aug 2010 12:38:00 +0000

The Jakarta Post, Jakarta | Tue, 08/31/2010 5:41 PM

President Susilo Bambang Yudhoyono officially proposed Bambang Widjojanto and Busyro Muqoddas as Corruption Eradication Commission leader candidates to the House of Representatives on Tuesday.

The president underlined that the selection of the two final candidates was free from his intervention.

“The selection team members are figures who have integrity, capability and credibility. The law does not give the president an authority to intervene the selection process and I uphold the stipulation,” Yudhoyono told a press conference.

He said both Bambang and Busyro were the best candidates who had undergone a strict selection process. The president also expected that whoever passed the House screening could help uproot corruption.

“We want the KPK to work effectively in line with our program to fight corruption and uphold the law,” Yudhoyono said.

The House has three months to respond to the nomination of Bambang and Busyro.

Only 21 SOEs fully comply with mandatory wealth report

Cempaka — Sat, 28 Aug 2010 07:52:00 +0000

The Jakarta Post, Jakarta | Sat, 08/28/2010 10:48 AM

Only 21 out of 141 state-owned enterprises have fully complied with the mandatory wealth report requested by the Corruption Eradication Commission (KPK) as part of the country’s fight against graft.

The State-owned Enterprises Ministry data revealed that as of Aug. 24 the 21 state companies, including PT Pelindo II, PT Adhi Karya, PT Inhutani III, PT Inhutani IV, PT Asabri, PT Jasindo, PT Jasaraharja, PT Dahana, PT Wijaya Karya, PT Pembangunan Perumahan, PT Sarinah, PT Inka, PT Pradnya Paramita, Perusahaan Perdagangan Indonesia (PPI), PT Reindo, PT Batan Teknologi, have submitted wealth reports of all their executives to the KPK.

State firms which are considered less compliant with the compulsory wealth report include national flag carrier PT Garuda Indonesia, state bank PT Bank BNI and state gas distributor PT PGN, Antara news agency quoted the ministry.

The ministry also said 5,550 or 86 percent of state company officials subject to the wealth report policy had fulfilled their obligation.

SOE Minister Mustafa Abubakar had asked the KPK to remind the state company officials.

He expected all the defiant state firm officials to declare their wealth by the end of September. The government, he added, will impose sanctions, ranging from salary cut to demotion, against those who refuse to report their assets.

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Big names

Cempaka — Fri, 27 Aug 2010 07:35:00 +0000

The Jakarta Post, Antara | Fri, 08/27/2010 1:59 PM

Justice and Human Rights Minister Patrialis Akbar (sixth left) leads a press conference at the Presidential Office in Jakarta on Friday after a selection committee for the new chairman of the Corruption Eradication Commission (KPK) gave two candidate names to President Susilo Bambang Yudhoyono. The committee chose Judicial Commission chairman Muhammad Busyro Muqoddas and human rights activist Bambang Widjojanto out of seven final candidates. Antara/PAndu Dewantara

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