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Soeharto ordered bill funding

Jakarta Post - December 5, 1997

Jakarta – Minister of Manpower Abdul Latief said yesterday that it was President Soeharto who ordered the use of state-owned social insurance company PT Jamsostek's funds to finance the deliberation of the manpower bill.

Latief said the President's decision was taken because the ministry fell short of funds and the government was pressed for time to establish such a crucial law in the face of many problems such as unemployment.

According to Latief, the President told him that from now on he would directly oversee the spending of Jamsostek's funds.

"The President instructed me to convey this to the press," he told journalists after attending a ceremony to present Upakarti awards for small companies at the State Palace. The ceremony was led by Vice President Try Sutrisno.

Latief met with Soeharto Wednesday at the latter's residence on Jl. Cendana, in Central Jakarta to report on, among other things, the controversy surrounding the use of Jamsostek's funds to finance the deliberation of the manpower bill.

Latief came under severe criticism for allegedly paying members of the House of Representatives to help pass the controversial bill his office sponsored. He denied the allegation but admitted to using the money for, among other things computer services during deliberation al some expensive hotels.

Earlier reports said that Latief had asked Jamsostek for Rp 7.1 billion (US$2.15 million) to finance the two months of deliberation, but the company only managed to provide Rp 3.1 billion. The money was taken from the company's budget earmarked for protection of workers and membership expenditure.

"As I told you before, Rp 2.85 billion has been used (to process the bill). It included Rp 950 million for secretariat and computer services," Latief said yesterday adding that Jamsostek's funds had also been used to finance the repatriation of 24,000 illegal Indonesian workers from Saudi Arabia last month.

Latief said the government asked for Jamsostek's help because the company had performed commendably. Its assets are worth Rp 5.3 trillion, with cumulative profits in the past three years reaching Rp 476 billion. The Development Finance Comptroller (BPKP) and the Attorney General's Office are now investigating the alleged misuse of the funds. The Jakarta Provincial Prosecutor's office has questioned eight people in connection with the case.

Latief said the President had also assigned Minister/State Secretary Moerdiono "to solve problems with related state agencies". "This is the President's instruction. As an aide of him I must obey his order. An honest minister must act like that," he said.

Deputy House Speaker Syarwan Hamid and legal expert Muladi found nothing wrong with Soeharto's order to Latief, saying that it was common for a leader to take over his or her aides' responsibility.

"In management, such a practice is acceptable," said Syarwan.

Muladi said although the takeover was constitutional legal proceedings to investigate possible administrative irregularities in the use of Jamsostek funds must go on.

"The investigation itself remains under the President's supervision, given that both the BPKP and the Attorney General's Office are two government institutions," Muladi said.