Cabinet focuses on meeting basic needs

Cabinet focuses on meeting basic needs

JAKARTA (JP): President Soeharto asked ministers yesterday to
donate their first year's salaries to the poor, declare their
personal wealth and that of their spouses and pay serious
attention to the public's demand for clean and credible
governance.

Soeharto conceded at the first plenary session of his 36-
member cabinet that he had yet to find the best solution for the
current economic crisis, calling on the nation to brace itself
for the possibility of more pain.

"But the President has instructed the continuation of
government subsidies for imported basic staples and medicines,"
Coordinating Minister for Economic, Financial and Industrial
Affairs Ginandjar Kartasasmita said after the cabinet meeting.

Ginandjar said the essential commodities would be sold on the
open market at an exchange rate of Rp 5,000 to the American
dollar -- against the market rate of Rp 10,000 -- to help
alleviate some of the pain.

Minister/State Secretary Saadilah Mursjid said the President
asked ministers to follow his example by donating their first
year's salaries to poverty-alleviation programs.

"Mr. President has decided to donate his entire presidential
salary and allowances to the poor, saying he can live comfortably
on his soldier's (five-star general) pension," Saadilah said.

Ginandjar, Saadilah and Information Minister Alwi Dahlan
briefed the media yesterday on the outcome of the 90-minute
cabinet session.

According to a 1993 decree of the finance ministry's
Directorate General for Budgetary Affairs, the monthly salaries
of the President and Vice President are Rp 15 million ($1,500)
and Rp 10 million, respectively.

Cabinet ministers, the speaker of the House of Representatives
and chairman of the Supreme Court and Supreme Audit Agency each
get a basic monthly salary of Rp 2.5 million ($250).

Minister of Social Services Siti Hardijanti Rukmana has been
assigned to manage the funds derived from the President's and
ministers' salaries, Alwi said.

"I will manage the funds in a transparent manner," Hardijanti
said at a news conference late yesterday.

Ginandjar said the President also ordered the ministers to
hone their spending priorities in order to make the most
efficient and productive use of the severely limited state
budget.

"In facing this most difficult economic condition, which is
similar to the dire situation in the early phase of the New Order
government, we certainly need to rearrange our spending
priorities." he said.

At the meeting, the President conceded that he had yet to find
the best solution to the current crisis, notably stabilizing the
rupiah rate, Ginandjar said.

IMF

Soeharto said the government would continue negotiating with
the International Monetary Fund to resolve any differences of
opinion in implementing the 50-point economic reform he agreed to
on Jan. 15 as a condition of the US$43 billion bailout program
arranged by the IMF.

"However, we will go ahead with our reform program with or
without IMF assistance," Ginandjar added.

"Soeharto underlined that we must depend on our own
capability. In this difficult time the most important thing is a
solution (to the crisis) and to stabilize the rupiah rate."

Ginandjar indicated that the government had yet to decide on a
mechanism to stabilize the rupiah rate at a reasonable
level.

"Even though a fixed rate regime under a currency board system
(CBS) is one of the mechanisms being mulled over, the government
has not yet taken a firm decision on this.

"But I regret that the heated debates on the CBS have caused
some misunderstandings with the IMF which are now trying to be
mended.

"We require a large sum of foreign reserves to back up a
credible CBS," he said in reference to one of the barriers to
immediately adopting the mechanism.

Elaborating on the social safety net for the poor, Ginandjar
said the government would give top priority to securing adequate
supplies of rice, soybeans, cooking oil, sugar and wheat flour at
reasonable prices.

The State Logistics Agency (Bulog) has been forced to import
more than three million tons of rice this year because the
country's production declined substantially due to the impact of
El Nino.

Minister of Information Alwi Dahlan said the President
instructed the ministers and provincial governors to declare
their personal wealth and that of their respective spouses,
whether in fixed or liquid assets, to him as part of the drive to
create a clean government to resurrect public confidence in the
government.

"In case a minister is faced with a corruption charge during
his or her tenure, the personal asset declaration can then be
used as a reference for investigations," Alwi quoted the
President as saying.

However the personal asset reports would not be made public,
he said.

The upper echelon of officials -- such as secretary-general
and director general at ministries -- are required to declare
their personal wealth to Coordinating Minister for Development
Supervision Hartarto.

Five of the 36 ministers have large business interests,
including Minister of Tourism, Arts and Culture Abdul Latief, who
is the founder of the ALatief Corporation and Sarinah Jaya
department store, and State Minister of Empowerment of State
Enterprises Tanri Abeng, who is the president of Bakrie Group.

Minister of Industry and Trade Mohamad "Bob" Hasan owns large
stakes in timber and engineering companies, paper and pulp mills,
shipping and a wide diversity of other businesses.

Minister of Social Services Siti Hardijanti Rukmana
(Soeharto's eldest daughter) controls the widely diversified
Citra Lamtoro Group, while State Minister of Sports and Youth
Affairs is a major shareholder in the AN-Teve broadcasting
service and PT Media Target Prestasi. (prb)