Debt settlement solution sought

Debt settlement solution sought

JAKARTA (JP): Representatives of the Attorney General's Office
have offered a helping hand to the Gelora Senayan Management
Board (BPGS) in finding a solution to the settlement of a debt
owed by a consortium assigned to manage the 19th Southeast Asian
Games.

Minister of Youth Affairs and Sports Agung Laksono said on
Tuesday that the representatives visited him several weeks ago to
ask for an explanation of a media report about the possible
writing off of the debt.

"The representatives from the Attorney General's Office said
they would help us with a legal settlement if the consortium
failed to pay off its debt," said Agung, who is also a BPGS vice
chairman.

Last week, Gelora Senayan sports complex's board of directors
agreed to write off a Rp 1 billion debt owed by a consortium
assigned to manage the biennial event held here in October 1997,
but the final decision would be the State Secretariat's.

The consortium incurred the debt through preparing venues at
which to stage various competitions and training programs.

Minister Agung said the consortium had repeatedly asked for
the debt to be written off, citing financial constraints as the
main reason.

"When the consortium took over the deal to support the Games,
it pledged to pay in installments. However, it never paid the
installments. It only paid third parties. They had a logical
argument that the money was used for the training program, which
was a way to promote the nation's name in international sports,"
he said. The third parties were those who gave services to the
athletes, such as cleaning or catering services.

He said, however, that the State Secretariat insisted the
consortium pay off its debt.

"But if the State Secretariat agrees to the write-off, then
the debt business is over. I hope concrete action will be taken
immediately, because the money belongs to the State Secretariat,"
Agung said, adding that the debt write-off would also need
approval from the Ministry of Finance.

The consortium, chaired by one of former president Soeharto's
sons, Bambang Trihatmodjo, was responsible for raising funds to
finance the Games.

In its audit report, the consortium declared a Rp 68 billion
deficit. The financial losses excluded Rp 46 billion in debts the
consortium owes to the Senayan management board, the Jatiluhur
reservoir authorities and hotels which accommodated participating
athletes during the event as well as the Ministry of Forestry.

The consortium's executive director, Bambang Riyadi Soegama,
told minister Agung last September that it had not embezzled the
money. Soegama also said the consortium would approve of a legal
settlement if it failed to pay off its debt.

The Attorney General's Office is currently investigating
allegations of corruption, collusion and nepotism involving
Soeharto, his families and cronies. Attorney General Andi M.
Ghalib earlier vowed to have the investigation completed before
the People's Consultative Assembly's General Session in
August. (ivy)