Tue, 10 Jun 2003

BPKP finds irregularities in 2003 budget spending

Dadan Wijaksana, The Jakarta Post, Jakarta

The Development Finance Comptroller (BPKP) has found a total of 1,697 irregularities in the 2003 budget spending as of April, with potential losses projected at around Rp 1.01 trillion (US$123 million).

"The amount (of irregularities) came from a total of Rp 23.6 trillion in spending we have inspected since April," BPKP chairman Arie Soelendro told legislators during a hearing with the House of Representatives Commission IX on financial affairs.

The irregularities took place at state institutions, ministries and regional governments.

The agency defines "irregularity" as a deviation from the law, a deviation from a set of objectives, and noncompliance with ethics or efficiency.

As the BPKP does not specifically allege corruption or embezzlement in the report, irregularities can thus mean outright losses or simply potential losses.

Among state institutions, the worst performer is BP Migas, the country's oil and gas upstream authority, with 19 cases of irregularities that may cause a loss of Rp 29.2 billion -- the largest potential loss by a state institution.

This was followed by the State Logistics Agency (Bulog) with 22 cases and a potential loss of Rp 1.8 billion.

As for regional governments, North Maluku province recorded the largest number of irregularities, with 50 cases valued at a potential loss of Rp 9.1 billion. North Sumatra had the second largest number of irregularities, with 28 cases at Rp 2 billion.

During the hearing, Arie also said that the agency was facing difficulties pushing ahead with the audits in order to follow up with the findings for various reasons.

"For example, of the total 1,697 cases, only 296, or 17 percent, have been followed up with an audit," he said.

The reasons ranged from the lack of attention from the management of the audited institutions, to the absence of sanctions from the government, to a simple failure of the management to follow up, he added.

As far as the irregularities in regional governments were concerned, Arie said, the Regional Autonomy Law had made it harder for the BPKP to proceed with its investigation.

The law gives regions across the country bigger roles in managing their own affairs, including their supervisory roles.

Meanwhile, the report also mentioned that, as of April, the agency had submitted to the Attorney General's Office a total of 15 cases with a strong indication of corruption, valued at a total of Rp 12.6 billion.

"A litigation process is now underway at the Attorney General's Office," the report said.