Firms' appeal to adjust power rate hike rejected
Firms' appeal to adjust power rate hike rejected
JAKARTA (JP): The government turned down on Wednesday an
appeal from several firms to adjust an electricity rate increase,
and told them instead to reschedule their bill payments with
state electricity company PT PLN.
Minister of Energy and Mineral Resources Purnomo Yusgiantoro
said the government could not accept a proposal for a gradual
increase.
Some business organizations have asked the government to
adjust the hike by up to 101 percent by September 2002. But they
want the rate hike to be limited to 20 percent this year.
"There will be no revision in the 2000 power rates. What can
be done is to negotiate the payments with PLN," Purnomo said,
following a hearing with House of Representatives Commission V
for industry and trade affairs.
Minister of Industry and Trade Luhut Pandjaitan also attended
the hearing.
The government decided in April to increase power rates
between 53 percent and 76 percent. But the organizations have
complained that the decision to hike power rates was too sudden.
Members of the associations said they could not afford the
hike because the government also raised fuel prices and the
regional minimum wage for workers in the same year.
Most of those complaining were textile firms, which employ a
large work force and are PLN's largest consumers.
PLN president Kuntoro Mangkusubroto said PLN would wait until
the end of December to see whether the government would accept or
dismiss the companies' request for downward revisions of new
power rates.
If the government turned down their appeal, he said, PLN would
stick to the new power rates and disconnect the power of those
refusing to pay them.
Purnomo said a revision in the rate hike would hurt the
financially strapped PLN.
He also warned that negotiations on the rescheduling of rate
payments should not cause PLN to miss its revenue target.
"A step-by-step payment negotiation can be discussed with PLN,
but if it affects the government's subsidies, then this concerns
the finance ministry," he told legislators during the hearing.
Purnomo feared that a drop in PLN's expected revenue would
require the government to cover the shortfall with another
power subsidy, which was budgeted at about Rp 3 trillion (some
US$315 million) this year.
PLN data shows that since April, overdue payments have
amounted to Rp 600 billion, of which Rp 400 billion is owed by 29
firms.
PLN said it had completed negotiations with 45 companies, with
another four yet to settle.
But the state company said five of the 54 companies continued
to defy calls for negotiations with PLN.
Luhut warned that the government would get tough on firms who
avoided the negotiation table.
He said he would check whether the companies refusing to pay
were actually experiencing financial difficulties.
"We will go through each of the company's balance sheets, and
if their books show that they were telling the truth, then we
will help them, otherwise we'll squash them," he said after the
meeting.
PLN marketing and distribution director Eddie Widiono said
that of the five firms refusing negotiations, one was a steel
company and the other four were textile companies.
Eddie said only companies with pressing financial problems
were given the option to negotiate their bill payments.
"But the company must first sign a document in which it
acknowledges that it owes money to PLN," Eddie said.
He said PLN would remain consistent and disconnect the power
of the five companies if no progress was made by the end of the
month. (bkm)