Economists back transfer of forestry fund
Economists back transfer of forestry fund
JAKARTA (JP): Economists welcomed the government's move to transfer US$270.90 million of forestry funds to the Ministry of Finance as state contingency funds.
"This is a good move because the forestry funds, under the finance ministry, will be more transparent and accountable to the public," Hadi Soesastro, executive director of the Centre for Strategic and International Studies, told The Jakarta Post Saturday.
Minister of Forestry Djamaludin Suryohadikusumo told the House of Representatives on Friday that his office had transferred $270.90 million of its reforestation funds to the finance ministry to offset any possible shortfalls from declining oil prices in state revenues in the 1995-96 fiscal year.
Similar praise was also voiced by business analyst Christianto Wibisono, chairman of the Center of Indonesian Business Data.
"By transferring reforestation funds into the state budget, we can be a little more sure of accountability," he said.
It is entirely up to Minister of Finance Mar'ie Muhammad to decide on the allocation of that fund, Djamaludin said.
The transfer from the forestry ministry increased the amount of reserves held by the government to more than Rp 2.2 trillion. Some Rp 1.7 trillion of this reserve came from budget surpluses accumulated over the last three years.
The government has calculated its oil revenues in 1995-96 on the basis of an average price of $16.50 per barrel.
The budget forecasts revenue from the oil and gas sector at $6.03 billion or 17.01 percent of total domestic revenue.
Both Hadi and Christianto, although they differed on the likeliness of a deficit, consented that there is nothing wrong with increasing the reserve.
"Although I don't think deficit is likely, it is always good to have more reserves," Hadi said.
Christianto said that the reserve can be used for other emergencies instead of compensating for deficits.
Levies
Official figures show that Rp 3.04 trillion in reforestation funds have been raised through levies collected from forest concessionaires over the last five years.
The funds, currently placed in state banks in time deposits, are managed by the forestry ministry and not counted as state budget revenues. Their utilization therefore escapes legislative supervision.
The government merely stipulates that reforestation funds are strictly for forestry development programs which may be carried out by the concessionaires.
Many observers and environmental organizations were surprised last year when the forestry ministry transferred about $185 million of interest gained from the reforestation funds to IPTN, the state aircraft manufacturing company chaired by State Minister of Research and Technology B.J. Habibie. A presidential decree allowed it to be transferred as an interest-free loan.
Eleven environmental groups filed suit against President Soeharto through the State Administrative Court. The presiding judge turned down the suit.
Another economist, who requested anonymity, said Saturday the transfer of the reforestation funds to the finance ministry may be a way to prevent further "unorthodox" use of the funds.
"Judging from the characters of Ministers Djamaludin and Mar'ie, it is quite possible that this is a political move to control the funds," he said. (hdj/rid)