Government issues crucial decree on land acquisition

Muninggar Sri Saraswati and Rendi A. Witular, The Jakarta Post/Jakarta

The government has finally issued the much-awaited regulation on land acquisition in an effort to speed up the construction of massive infrastructure projects, sacrificing rights of property owners opposed to the projects.

Presidential spokesman Andi Malarangeng said President Susilo Bambang Yudhoyono had already signed Presidential Regulation No. 36/2005 on Land Provision for the Development of Public Interests. The regulation was issued to resolve problems in land acquisition for state infrastructure projects for the sake of the public.

"The regulation is to speed up the planned massive infrastructure construction. We understand that land acquisition has become an obstacle for infrastructure construction," he told reporters at the State Palace on Friday.

Andi reiterated that uncertainty caused by the problem had quelled investors' interest in the infrastructure sector, at a time when the country was in dire need of investment in the sector to support higher economic growth and reduce unemployment.

The massive infrastructure projects are part of the government's effort to prevent congestion in distribution, which significantly increases the cost of doing business here.

However, numerous infrastructure projects in the country have run aground due to problems related to land acquisition, with investors facing widespread protests and rejection from land owners.

Land owners' objections in the East Flood Canal construction in the eastern part of Jakarta and in the construction of a few sections of the Jakarta Outer Ring Road have halted those projects.

Therefore, the government has included in the regulation an authority to eliminate the land owners right to protect their properties, unless an agreement is made on the compensation payment given by the government for the land.

The right, however, can only be applied to a minority of land owners who fail to agree on compensation payments offered by the government for their land that will be used for public facilities or infrastructure.

The regulation allows land disputes to be resolved in court, while the construction of the project continues.

It also stipulates that the compensation to land owners be based on the land's taxable value of property (NJOP) and its current market price. The price assessment for the land will be conducted by an independent property appraiser.

To prevent land speculation, the regulation also stipulates a safeguard arrangement for land owners -- whose land will be used for public facilities -- in selling their lands to other parties aside from the government.

"People who want to buy a land allocated for public facilities in the future, should seek a written approval from local administrations before they seal the deal," said Andi.

In the approval, the buyer should agree that he or she will not sell the land to other parties at a higher price than that initially set by the government.

At present, the government and private investors have to spend additional funds to buy land at higher prices due to the emergence of land speculators.

Andi said the safeguarded locations should be allocated by local administration's spatial agencies for public facilities.

In Greater Jakarta, for example, a land safeguard will be applied for the toll road connecting Cikarang in Bekasi and Tanjung Priok in North Jakarta; a road section from Depok to Jl. Antasari in South Jakarta and the Cinere and Jagorawi route in Bogor.

I-box Presidential Regulation No. 36/2005 covers: 1. Public roads, toll roads, railways, water pipes and sanitation 2. Dams, reservoirs, irrigation works 3. Public hospitals and public health centers 4. Seaports, airports, railway stations, bus terminals 5. Religious facilities 6. Schools 7. Markets 8. Public cemeteries 9. Public shelters 10. Post and telecommunication facilities 11. Sports venues 12. Television, radio stations and supporting facilities 13. Government offices, embassies, the United Nations or agencies under the auspices of the UN 14. Military and police facilities and installations 15. Penitentiaries 16. Low-cost apartments 17. Garbage dumps 18. Natural and cultural conservation areas 19. Parks 20. Social institutions 21. Power plants, transmission and distribution facilities