Govt to take over TNI businesses
Kurniawan Hari, The Jakarta Post/Jakarta
Minister of Defense Juwono Sudarsono said on Wednesday that the government would take over military business enterprises that have assets worth Rp 5 billion (US$550,000) or more, while smaller ones would continue to be owned by the Indonesian Military.
Speaking during a hearing with the House of Representatives' defense commission, Juwono said that the enterprises taken over by the government would be converted into state-owned companies.
"The smaller ones will not be taken over. They will still be owned by the TNI to help fulfill the soldiers' needs," Juwono said, referring to the Indonesian Military.
The assets of the business enterprises owned by the military range between Rp 1 billion and Rp 5 trillion.
The TNI Law (No.32/2004) strictly bans soldiers from getting involved in any business activities. The law also says that all TNI activities and needs are to be financed out of the State Budget.
The TNI law, signed by former president Megawati Soekarnoputri on Oct. 16, also stipulates that the government must take over all business activities of the TNI within the next five years.
It was not surprising, therefore, that Juwono's statement immediately drew strong reactions from legislators attending the hearing.
Djoko Susilo of the National Mandate Party (PAN) said that as long as soldiers continued to be involved in business, efforts to build up a professional military would be difficult to realize.
"We do not want soldiers to engage in business while at the same time forget their military responsibilities," Djoko said.
Effendi Simbolon of the Indonesian Democratic Party of Struggle (PDI-P), meanwhile, said that Juwono's statement was a personal opinion and therefore could not be used as a reference.
He said that the minister would possibly carry out the reform by focusing on businesses that have assets of more than Rp 5 billion.
Juwono said he had floated the idea simply to stimulate discussion on the TNI's business activities. He also said that he would meet with State Minister for State Enterprises Soegiharto to discuss the issue.
During a hearing with the defense commission last week, TNI chief Gen. Endriartono Sutarto acknowledged that the TNI's business enterprises contributed 70 percent of the TNI's budget. During the hearing, legislators urged the TNI to make moves to comply with the TNI law.
Responding to the demand, Endriartono said that the TNI had asked an independent auditor to audit the military's businesses.
"We will report the results of the audit to the House," he added.
Meanwhile, defense observer Kusnanto Anggoro from the Centre for Strategic and International Studies (CSIS) said that building up a professional TNI was essential.
He said that in its current state, the TNI would be able to perform optimally in defending the country's territorial integrity.
Kusnanto added that the main problem in the TNI was not the amount of money it received but rather transparency and accountability in the way it spent this money.
Meanwhile, Andi Wijayanto from the University of Indonesia (UI) said that the defense ministry and the TNI must decide on which units should be upgraded to counter potential threats.
"For example, if we agree that the major potential threats are separatist rebels and sectarian conflicts, then we must reinforce the Army," he said.
Selected military business ============================================================= Companies Assets Owner ------------------------------------------------------------- PT Indotruba Tengah 116 billion Army PT Taliabu Timber 7 billion Army PT Sumber Mas Timber 35 billion Army PT Bank Artha Graha 5 trillion Army PT Aerokarto Indonesia 869 million Air Force PT Yala Trading - Navy ------------------------------------------------------------ Source: ICW, TNI