Government will not write off consortium debts: Agung

JAKARTA (JP): State Minister of Youth Affairs and Sports Agung Laksono on Wednesday refuted reports that the government would write off the debt of the 19th Southeast Asian (SEA) Games underwriting consortium.

"The reports are untrue. The government will only take over the consortium's debt, but only after a thorough review of the consortium's audited financial reports saying they suffered losses," he announced after a coordination meeting on the eradication of poverty.

"The debt must be covered because we cannot let the forestry ministry suffer losses if the International Monetary Fund audits its financial reports. The debt is Rp 35 billion (US$5.23 million) plus Rp 5 billion in interest."

The consortium, which was responsible for raising money to stage the biennial event in 1997, owes Rp 35 billion to the State Secretariat, but claims it had no idea the money was taken from the forestry ministry's reforestation fund.

The consortium, chaired by former president Soeharto's son Bambang Trihatmodjo, asked the government to take over its debt, saying it was unable to repay its total debt of Rp 156 billion.

The idea arose from a meeting between Agung, Deputy Attorney General for Civil and State Administrative Affairs Wan Jacob Rahim Saleh and the consortium's executive director, Bambang Riyadi Soegama, two weeks ago.

"It is not certain the government will take over the debt because it will have to see if the consortium's failure to pay its debt was based on mismanagement or force majeure. If it was because of force majeure, we must consider whether to force them to repay all of their debt, or excuse them from paying the interest on the debt or take some other action. This is not under my authority, but the state secretary's," Agung said.

"The decision is not final because we also have to consult with the House of Representatives, hopefully, on Monday."

Minister of Justice/State Secretary Muladi expressed his reservations last week about the government underwriting the consortium's debt.

He also proposed the idea of hiring a public auditor to reaudit the consortium's financial reports.

Agung said if the government took over the debt, the consortium would not be excused from repaying its debt.

"We're not writing off their debt. Don't think that they can just run away from their responsibilities," he said.

Agung urged the consortium to begin rescheduling its debt repayments, as promised by Bambang Soegama last year.

"The consortium has been promising to repay its debts step-by- step since last year, but apparently they gave up due to the monetary crisis."

Agung said the consortium had repaid 60 percent of its Rp 1.3 billion debt to hotels and the Gelora Senayan management board.

Agung also said Habibie had approved his visit to a number of training centers to oversee national athletes' preparations for the 20th SEA Games in Brunei Darussalam from Aug. 7 to Aug. 15.

However, Agung contradicted the National Sports Council's stated ambition to retain the country's overall title in the biennial event.

"It's more important to improve our athletes' performances, particularly the juniors, than to retain the title. Retaining the title is number two," he said.

Agung also said the government would give moral support to Indonesia's Ananda Mikola, who is racing in the Formula 3000 in Italy.

"Ananda is a very talented athlete who needs to be supported. The government urges businesspeople to financially help Ananda reach his ambition of becoming Formula 1 champion." (yan)