3M not violating ministerial decree, GM Mutia proclaims

3M not violating ministerial decree, GM Mutia proclaims

JAKARTA (JP): PT Mutiara Mandala Mahardhika (3M) general
manager, Mutia Farida, said on Saturday her company was not
violating a ministerial decree issued by the former ministry of
social services last year.

Mutia was responding to an ultimatum given by the state
minister of social affairs and chairman of the National Social
Welfare Agency (BKSN), Anak Agung Gde Agung, to improve the
People's Fund for Sports fund-raising program (Damura).

"We told Pak Agung in a meeting on Thursday that we were not
in violation of the decree. If we have to change the program, we
will only decrease the amount of the prize money and increase the
percentage of the donation for sports development," she said in a
telephone interview.

Anak Agung told a news conference on Friday that the
government would withhold permission to launch Damura unless PT
3M could meet 12 conditions made by the government.

"We are within the guidelines of the ministerial decree and
have followed those of the Indonesian Ulemas Council," Mutia
said.

She said PT 3M would lower the total percentage of prize money
from 50 percent to 40 percent. PT 3M, which plans to sell 10
million Damura cards over an as yet to be determined period for
Rp 5,000 (0.70 US cents) each, initially earmarked Rp 25 billion
for prize money.

"The prize money is in accordance with the ministerial decree.
There is a certain calculation which I personally don't really
know. We consider the highest prize money of Rp 25 million fair
enough for consumers. We have followed MUI's guidelines saying we
can't offer big prizes as it could encourage people to gamble."

"The original prize money was Rp 250 million because it's a
new program in the country and we wanted to give the best to our
consumers. The Rp 25 million is based on polling."

Anak Agung said PT 3M was wrong as it offered Rp 166 billion
prize money in one year instead of Rp 6 billion as stated in the
decree.

"Based on experience in the Philippines, selling has dropped
as the organizers lowered the prize money to only 35 percent. We
don't want that to happen here," Mutia said.

Mutia also declined to follow Anak Agung's suggestion to
increase the price of the scratch cards to avoid poor people
buying them.

"We think Rp 5,000 is too expensive for them. If we have to
increase the price, it would really be difficult for us to sell
the cards. If Damura is too expensive, I'm afraid the National
Sports Council (KONI) and BKSN won't get any contribution from
our profit," she said.

Mutia also turned down the condition to print the insurance
policies and Damura cards at state money printing company PT
Peruri.

Each Damura ticket consists of two parts. The first is a
scratch and win card, which offers a chance to win between Rp
5,000 and Rp 25 million if the holder scratches three symbols
that match. The second part is a one-month life insurance policy
which the holder or his or her estate can claim Rp 2.5 million
should he or she suffer a permanent disability or dies.

"I think it's a misunderstanding. Only the insurance policies
will be printed at PT Peruri, not the scratch cards. We could
have printed the cards at PT Peruri but I won't risk the business
for cheaper production costs to avoid counterfeiting. We'll print
the cards at the Scientific Games International (SGI) base in
Atlanta, Georgia."

Mutia said KONI would receive 16.5 percent, 10 percent more
than the original agreement, to support sports development. The
decision has followed the government's condition.

Speaking on the schedule to launch Damura, which was
originally in November 1999, Mutia said due to the Ramadhan
fasting month, Christmas holiday and Idul Fitri at the time PT 3M
received the decree, the launching was postponed out of respect
for Muslims and Christians. (yan)