House to amend BI law on Dec. 6
House to amend BI law on Dec. 6
JAKARTA (JP): The House of Representatives vowed on Thursday
to complete the amendment of the central bank law by Dec. 6, so
as to allow an immediate reshuffle of the top management of Bank
Indonesia.
House deputy speaker Tosari Widjaja said that the government
would propose an amendment bill to a plenary session of the
legislature on Nov. 27.
Speaking to reporters following a closed door meeting of the
House's consultative body, Tosari said that the various factions
in the legislature would then debate the bill on Nov. 29 and 30,
and that a special House team would debate it intensively from
Dec. 1-6.
He said he hoped the amendment of the central bank law would
be approved by all the factions on Dec. 6 and that the central
bank's new management team would be selected before the House
went into a one-month recess.
"We are planning a long recess from Dec. 11 until Jan. 12,
2001," he said.
He explained that the House had decided to deal with the
amendment through the normal legislative process rather than
employing the short-cut mechanism as initially planned, in an
apparent move to avoid public suspicion that the amendment was
intended merely to force out the current Bank Indonesia Governor
Sjahril Sabirin.
Tosari did not say when the Bank Indonesia management
reshuffle would take place, but if the central bank law were to
be amended, the House could easily dismiss Sjahril in accordance
with the law and quickly install a new board of governors. This
could take place even before legislators start their long recess
on Dec. 11.
Under the current central bank law, which was approved by the
House in May 1999, the eight members of the board of governors of
Bank Indonesia may not be replaced unless they have been proven
to have committed a crime, become incapacitated or voluntarily
step down.
President Abdurrahman Wahid has long insisted on a reshuffle
in the top management of Bank Indonesia so as to rid the central
bank of the corrupt practices of the past. But his plan was
stymied by the central bank law and the stubbornness of Sjahril,
who until now has refused to resign.
The amendment to the central bank law will include a clause
allowing for the dismissal of a member of the board of governors
if he or she has not been active in office for three consecutive
months.
Sjahril has been under house arrest since June over his
alleged involvement in the politically-charged Bank Bali scandal
last year. Sjahril has so far denied all wrongdoing.
The amendment will also increase the duty of accountability
owed by Bank Indonesia, with the House being empowered to fire
the governor and the deputy governor should they fail to meet the
monetary targets set by the central bank.
The financial markets have shown nervousness over the past few
days following the resignation of senior deputy governor Anwar
Nasution and four other deputy governors last week.
There has been concern that it may take longer than
anticipated for the House to pass the amendment and reshuffle the
bank's top management due to the amount of political wrangling
going on.
"We must complete the passage of the amendment bill as soon as
possible. Delaying it will only create more political
difficulties," Tosari said without elaborating.
The President has proposed Anwar and two other Bank Indonesia
officials, Siti Fadjriah and Hartadi A. Sarwono, as candidates
for the posts of governor and senior deputy governor. But reports
say that Siti and Hartadi have turned down the offer. (rei)