Jakarta – Trillions of rupiah in state funds are embezzled each year through corrupt procurement deals involving government facilities.

Former Corruption Eradication Commission (KPK) deputy Sjahrudin Rasul told civil servants attending a graft-prevention workshop Wednesday that improper conduct had eradicated almost half the total funding allocated for the purchase of new equipment for government facilities.

"Corruption is present almost every step of the way in these deals," Sjahrudin said to the audience.

Recent figures from the Supreme Audit Agency (BPK) indicate that up to 50 percent of national contracts involving equipment purchases are plagued by corruption. The Development Finance Comptroller (BPKP) estimates corruption levels to be around 30 percent.

"These deals involve large sums of money," Sjahrudin said. "In 2006, these contracts involved around Rp 118 trillion (US$10 billion), and that does not include funds from the regional budget, state or local businesses."

He said the nation's weak legal structure allowed these acts to go unpunished. "Also, the absence of standard pricing and an independent monitoring body, as well as the weakness of the Supreme Audit Agency all encouraged this cycle of misconduct to continue," he said.

Both the government and businesses have been involved in purchasing equipment in the past through closed deals hidden from the public eye.

This lack of transparency frequently leads to opportunities for corruption, Sjahrudin said. During the planning phase, there are often markups on the price of materials, with the figure hiked again just before the bidding process begins.

The documentation used in these deals is often falsified, incomplete or fabricated entirely, and as the parties involved have a vested interest in the outcome of the deal, this lack of official documentation makes tracing crimes and those responsible very difficult.

"From the very beginning of these deals, it is hard to determine whether every step along the way was purely made to allow corruption to flourish," Sjahrudin said.

The winner of the contract is usually determined well before the sale of any goods begins to ensure everybody benefits satisfactorily.

In the long run though, the result of these deals is always the same. Despite adequate funding initially, there are normally chronic shortages of high-quality goods and services at these government facilities, with key funding siphoned along the way.

According to Transparency International, Indonesia scored a Corruption Perception Index (CPI) of 2.6 out of 10, a slight increase from 2.3 in 2007.

"Yes, there has been a small improvement, and for that we should be grateful, but we still have a long way to go," State Minister for Administrative Reform Taufik Effendy said.

"We must strive to eradicate corruption in a way that involves all members of society." (dis)