Dennis Shanahan, Jakarta – Aid agencies operating in Indonesia using Australian government funding face scrutiny after John Howard offered to investigate if any of the funds were being spent to undermine Indonesian control in the rebellious provinces of Aceh and Papua.

At a meeting between the Australian Prime Minister and Indonesian President Megawati Sukarnoputri, the Indonesians raised fears that Australian government funds were being used to support separatist movements in Indonesian provinces. The Megawati Government has been concerned that aid agencies, in particular, are helping separatists in struggles for independence.

The issue of Indonesian sovereignty was high on the list of topics discussed at the meeting as was the investigations into the Bali bombing, people smuggling and anti-terrorism. Mr Howard assured Ms Megawati that it was not the intent of the Australian Government to support any separatist movements, and offered to investigate any evidence Indonesia had of Australian government funding being channelled into efforts to undermine Indonesian sovereignty.

After the private assurance Mr Howard publicly reaffirmed the "total support of the Australian Government for the indivisibility of the Indonesian republic, and total respect for and support of Indonesian sovereignty over all parts of that country".

"It is not part of the policy of the Government of Australia to in any way directly or indirectly support activities which are designed to undermine the integrity of the Indonesian Republic."

Ms Megawati publicly welcomed Mr Howard"s reassurance and said a "procedure" was now in place to deal with Indonesia's concerns.

He and Ms Megawati highlighted the success of the Bali bombing investigations and the continuing anti-terrorism co-operation between Australia and Indonesia. Mr Howard described the work of the Indonesian authorities on the Bali bombing as "truly impressive, professional and effective".