Analysts blast govt's plan to abolish Bulog
JAKARTA (JP): Analysts and a legislator have lambasted the government's plan to establish a new agency to replace the State Logistics Agency (Bulog), saying that during the economic crisis it is not the right time to abolish the agency.
They warned that abolishing Bulog would cause a disruption in the distribution of rice and would further cause severe suffering for the nation's poor.
The Center for Agriculture Policy Studies' executive director, H.S. Dillon, said on Sunday that replacing Bulog with a new agency could be an ill-timed decision because almost 80 million of the country's population were suffering an income shock and did not have the purchasing power to procure rice.
"The plan shows once again how deaf and blind the Habibie administration is to the sufferings of the people, who are food insecure," Dillon told The Jakarta Post.
He said that the government's intervention to ensure the availability of basic commodities was of the utmost important now.
"In a time of the crisis such as this, if the government had a real sense of crisis, then national food security would be accorded top priority and placed directly under the President," he said.
Minister of Industry and Trade Rahardi Ramelan, who is also acting chairman of Bulog, said earlier this month that it was studying the possibility of establishing a new agency by December to replace Bulog in another bid to improve the distribution of staple foods in the country.
Bulog has for a long time been notorious for its indulgences in collusive practices relating to the distribution of basic commodities. It has also been singled out as a target for reform by the International Monetary Fund.
Bulog is now only in charge of importing rice and distributing it throughout the country after it lost its monopoly rights of soybean, wheat, sugar and cooking oil imports and distribution.
Dillon argued that rather than establish a new agency, the government should focus on creating an effective distribution system for rice, which would ensure supplies reaching the very poor.
"But what Rahardi and his colleagues in the cabinet have been doing so far is experimenting with the poor. This is entirely a misguided sequencing of policies," Dillon added.
"They are immature. They don't know what they're doing. They are playing around. They are not focusing. They have no priorities. And they are experimenting with the poor."
Legislator Umbu Mehang Kunda, who chairs House Commission III for agriculture, forestry, transmigration and food affairs, echoed Dillon's view and said the government should improve Bulog's performance instead of establishing a new agency, which would take time to function well.
"The establishment of a new agency will only cause a deadlock in buffer stock activities," he said.
He said that members of the commission questioned the government's plan to eliminate Bulog, saying the country still needed the agency as a buffer stock to stabilize prices, especially for rice.
"Bulog has a long experience in distributing rice and it will not be easy to fill the role it has played so far because rice is a political tinder box in this country," Umbu said.
Economist Didik J. Rachbini from Institute for Development of Economics and Finance said that a food authority agency such as Bulog was still necessary in every country to ensure price stability of staples.
"The plan is good but the new agency should be transparent and effective in doing its jobs," Didik told the Post.
He said that Bulog's role should be expanded again in the distribution of other basic commodities aside from rice, such as soybean, sugar and drugs, to be in competition with private traders and subject to market forces. (gis)