Forestry ministry rejects request to transfer funds

Forestry ministry rejects request to transfer funds

JAKARTA (JP): The Ministry of Forestry and Plantations has
turned down the request from the Ministry of Finance to transfer
the Rp 1.1 trillion (about US$78.57 million) in forestry funds
raised before March 31 this year to the state treasury.

The ministry's Secretary General Oetomo S. said the transfer
of the money to the state treasury would drain all his office's
financial resources to finance the ongoing reforestation program.

According to the initial agreement, he said, the reforestation
funds that must be kept at the treasury office would be limited
to those raised after April 1 in order to comply with the
government's decision to include the funds in the state budget.

"If we have to transfer all the reforestation funds we
received, how can we finance our projects? The government would
have to find other sources to finance the projects. Besides, they
can not guarantee that the funds in the state treasury will be
returned to the forests," Oetomo told journalists.

He said the funds and the interest collected by the ministry
before April 1 have been allocated to finance the development of
timber estates and the ministry's reforestation and land
rehabilitation programs until the year 2000.

This amounted to around Rp 1.1 trillion, consisting of Rp
927.6 billion of reforestation funds and Rp 147.4 billion of
interest. This money is kept in the Ministry of Forestry's
accounts in several state banks.

Oetomo said that the finance minister's request conflicted
with that received from the state secretary, in which the
transfer of the reforestation funds to the state secretary is
limited only to those raised after March 31, the closing date of
the fiscal year.

He said the reforestation funds collected by his office from
April 1 until mid June amounted to over Rp 300 billion.

The reforestation fund is a mandatory fee imposed by the
government on forest concessionaires to ensure that forests are
managed in an environmentally sustainable manner. The size of the
fees depends on the volume and type of timber felled.

Starting April 1, the reforestation funds are accounted for in
the state budget as non-tax receipts. Previously, the funds were
transferred into the Ministry of Forestry's accounts. The
allocation and use of the funds were governed by presidential
decree.

Meanwhile, Minister of Forestry and Plantations Muslimin
Nasution said separately yesterday that the ministry has secured
Rp 330 billion in reforestation funds allocated for PT Kiani
Lestari and urea pill fertilizer producer PT Ario Seto Wijoyo.

He said that the ministry has taken back the Rp 250 billion
fund allocated for PT Kiani Lestari -- a company owned by
Mohammad "Bob" Hasan, a long-time crony of former President
Soeharto -- for its pulp and paper factory in East Kalimantan.

Muslimin said that the ministry has also secured Rp 80 billion
funds allocated for PT Ario Seto.

Former president Soeharto, during his tenure in power, issued
several decrees ordering the Minister of Forestry to allocate
reforestation funds to various projects run by his family members
and cronies which were not related to forest development. (gis)