Govt will not issue permits to delinquent developers

JAKARTA (JP): The government will use permits to make sure that luxury house developers carry out their obligation to construct low-cost housing, State Minister of Public Housing Akbar Tandjung said here yesterday.

"If the developers neglect their obligation to build low-cost public housing, local administrations will not issue the permits needed for their operations," Akbar said in a hearing with the House of Representative's Commission V which deals with housing issues.

He added that among the permits issued by local administrations are location permits, site-plan permits and building permits.

Under a joint decree signed by the ministers of public housing, home affairs and public works, private developers should apply a 1:3:6 housing scheme, which requires them to build six low-cost houses and three medium-cost ones for each luxury house built.

"The government will impose firm sanctions against developers refusing to construct low-cost houses according to the housing ruling," Akbar said.

The chairman of the Indonesian Real Estate Association, Enggartiasto Lukita, said that he supports the government's housing policy.

"Developers support the government's policy promoting the development of low-cost houses," he said.

However, commission member Ali Marwan questioned the integrity of big developers vis a vis their fulfillment of the government's ruling on the building low-cost houses.

Akbar acknowledged that some big developers have not fully met the requirements.

"In Bandung, for example, there is a developer which felt it had built enough low-cost houses after giving a subsidy of Rp 1.4 million (US$625) to the local administration for each luxury house it built," Akbar said.

By imposing the ruling, the government expects that during the sixth Five Year Development Plan (Repelita VI) period, which will end in 1999, at least 500,000 low-cost houses will be built.

During the first year of the Repelita VI period, the state- owned developer Perum Perumnas built 12,120 low-cost houses and private developers 68,177 other units, while cooperatives failed to build any houses. Repelita VI requires the three institutions to build a total of 93,000 houses in 1994-95.

Minister Akbar said that the cooperatives' failure to construct low-cost houses was caused by, among other things, the high prices of land and increasing construction costs. (31)