APSN Banner

Aceh agency in graft dispute

Source
Jakarta Post - August 28, 2006

Jakarta – The Attorney General's Office is looking into a report of alleged irregularities in Aceh-Nias Rehabilitation and Reconstruction Agency (BRR) projects.

"We are reviewing the newly released report," the office's deputy for special crimes, Hendarman Supandji, told The Jakarta Post on Saturday.

Indonesian Corruption Watch (ICW) announced Friday that its investigation, combined with "reports from the public", turned up evidence of irregularities in BRR-run projects. All of the projects in question were funded by the 2005 state budget.

The total value of the projects flagged by the graft watchdog is around Rp 23.8 billion (US$2.2 million). They include the publication of reports, the appointment of a media consultant and the appointment of a firm providing office equipment.

The reconstruction agency, chaired by former energy minister Kuntoro Mangkusubroto, manages about Rp 13 trillion in funds. Most of the money was donated by the international community following the devastating Dec. 26, 2004, earthquake and tsunami.

Nanggroe Aceh Darussalam suffered massive damage in the tsunami, with infrastructure destroyed and at least 150,000 people dead and missing.

Fears of graft were raised shortly after the disaster as billions of dollars in aid money poured in. To help expedite reconstruction in Aceh and Nias, a presidential decree was issued last year giving the BRR the right to award housing projects without a tender.

Teten Masduki, the ICW coordinator raised concerns that slow spending of BRR's budget could also lead to the awarding of non housing projects without a tender.

He said of the reconstruction agency's total 2005 budget of Rp 3.9 trillion, only 10 percent, or Rp 414.6 billion, had been absorbed in rehabilitation and reconstruction work.

"Similar irregularities could happen again this year because only 6.65 percent of the total Rp 9.6 trillion budget was spent in the first quarter of 2006-2007," he told the Post last week.

William Sabandar, BRR's representative in Nias, acknowledged Friday that spending was slow but said this was because of the "BRR's commitment to achieving a high degree of effectiveness, transparency and quality". However, he said, the agency's spending has now reached 65 percent of its budget. An agency report says it spent 62 percent of its Rp 13.1 trillion budget until April 2006.

The ICW has raised suspicion of collusion between the BRR and a number of firms involved in its projects. Among the projects questioned was the appointment of PT Emerson Asia Pacific as a BRR media consultant.

Teten alleged the direct appointment of Emerson had to do with the close ties between a BRR deputy chairman and Pratiwi Ibnu Tadji, the president of Emerson.

Ibnu Tadji, Pratiwi's husband, is the owner of PT Semar Kembar Sakti, which was appointed by the reconstruction agency to supply office equipment. Ibnu told the Post on Sunday the ICW's allegations were groundless. He said Emerson took part in a tender held by the BRR prior to the awarding of the contract.

Ibnu also denied his wife had close ties to any agency official, adding that any current close ties resulted "from working together after the contract was awarded". He also said Emerson had twice made clarifications to the ICW.

The graft watchdog also suspects irregularities in the publication of three reports in Indonesian and English. These reports detail the agency's work in its first six months, on the first anniversary of the tsunami and on the agency's first anniversary. The projects, valued at Rp 3.2 billion, involved nine partner companies.

"The ICW found indications of markups and graft in this project because the process did not follow official procedures and the printing costs were far higher than normal," Teten told the Post last week.

Prosecutor Hendarman of the Attorney General's Office said the Aceh Prosecutor's Office was investigating the allegations regarding the report project.

The BRR has said it "appreciates the ICW's findings" and will use them to improve the agency's internal controls. It added that the agency was open to a thorough investigation.

Country