Irawaty Wardany, Nusa Dua, Bali – Procurement bribery at government offices makes up the bulk of graft cases in Indonesia and reportedly costs it Rp 36 trillion (US$3.9 billion) a year, a top anticorruption official said Monday.
"Procurement is one of the areas most prone to corruption. Around 70 percent of the cases handled by the Corruption Eradication Commission (KPK) are mark-ups for procurements," KPK chairman Taufiequrrachman Ruki told reporters at a media conference after the opening of a regional seminar on Fighting against Bribery in Public Procurement in Nusa Dua, Bali.
The KPK has received 16,000 reports of cases but it was able to process only a few dozen, he said.
Taufiequrrachman said that the government lost around Rp 36 trillion (US$3.9 billion) each year because of corruption in public procurement. "Most of it is in government expenditure," he said.
Meanwhile, State Minister for National Development Planning Paskah Suzetta said he was now working with Coordinating Minister for the Economy Budiono, Finance Minister Sri Mulyani, and the KPK to prepare a presidential decree on the establishment of a national body for procurement.
"We are now in the process of finalizing the draft of the presidential decree. I hope it can be finished by the end of December this year so that the body can be established in early 2008," he said.
Currently there is only a unit in the National Development Planning Agency that regulates procurement procedures.
Paskah said that if bribery in procurement could be decreased, it was estimated that the government could save up 50 percent of the state expenditure.
He added that the establishment of the body was only one of the government's main agendas in procurement reform, which includes reforming the legal framework.
The reform includes the development of an electronic procurement system and capacity building of human resources. "We expect to improve the regulation on procurement procedures from a presidential decree into a law in the future," Paskah said.
Procurement procedures are currently regulated under a 2003 presidential decree.
Paskah said several regions had started to implement an electronic procurement system.
"We have made pilot projects in four regions, West Java, East Java, North Sulawesi and Kalimantan," he said. "The projects will also be developed in other areas. We expect the surrounding regions could learn from them."
On the electronic procurement system, Taufiequrrachman said that the KPK had proposed the government establish such a system in 2004.
"The government then started to implement the electronic announcement in 2005," he said. "And according to Pak Paskah, the government could save around Rp 9 trillion just from electronic announcements through 24 government institutions."