House urges government to seize consortium assets

House urges government to seize consortium assets

JAKARTA (JP): The House of Representatives' Commission VII on
education, youth affairs and sports recommended the government
confiscate the assets of the underwriting consortium for the 19th
Southeast Asian (SEA) Games.

The commission's deputy chairman, Engkoswara, from the Karya
Pembangunan faction, told reporters after a hearing with State
Minister of Youth Affairs and Sports Agung Laksono on Monday that
the government had the right to seize the assets if the
consortium was unable to pay its Rp 44 billion (US$6.6 million)
debt to the government.

"The commission and the government would ask the consortium
which assets could be seized. Maybe the government could
confiscate the Mulia hotel and imported luxury cars," he said.

The consortium, which was in charge of raising funds for the
SEA Games, owed Rp 35 billion to the State Secretariat. The
money, which has now increased to Rp 44 billion including
interest, was taken from the government's reforestation fund.

The consortium, chaired by former president Soeharto's son
Bambang Trihatmodjo, claimed it had suffered a Rp 68.1 billion
loss, according to a financial audit by KPMG Hanadi Soedjendro &
Co.

It built the 40-story Mulia hotel in the Senayan area to
accommodate all athletes in the biennial event. It also imported
luxury cars to transport top officials of each participating
country's National Olympic Committee.

The consortium blamed the losses on the economic crisis, which
hit the country mid-1997, and asked the government to write off
its debts.

But State Secretary Muladi declined the request and said he
would appoint another public accountant to audit the consortium.

Agung said later that the government would take over the debts
and would urge the consortium to repay them later.

"The commission had approved the government to take over the
debts but we hoped the written agreement would be signed, at the
latest, on Oct. 1 before we are all replaced by new House
members," Engkoswara said.

He also said that if the consortium's assets could not cover
the debts, the government could seize personal assets of former
members of the consortium.

"If they still could not pay their debts, we can solve the
problem in court," he said.

Engkoswara assured reporters that neither the commission nor
the government had any intention to write off the consortium's
debts.

"There is no way they can get away from this. They must be
responsible. But we must also study if their deficit was caused
by force majeure such as the economic crisis," he said.

Agung said that although the commission had approved the plan
for the government take over the debts, he would still need the
approval from the state secretary and coordinating minister for
development supervision and state administrative reforms.

"We must also discuss the consortium's obligation if the
government takes over the debt. There are three ways to solve the
problem. First, by rescheduling all the consortium's debts.
Second, by reducing the debts and third, by writing off the debts
due to the consideration of force majeure."

Agung said he would invite the consortium officials to meet
the commission to solve the problem.

Agung's assistant, Amrum Bustamam, said that President B.J.
Habibie was scheduled to visit the training center in the Senayan
sports complex "hopefully" this week.

"The President will see the preparations of our athletes
before they compete in the SEA Games in Brunei Darussalam from
Aug. 7 to Aug. 15. He will also see the Senayan complex to
observe if the complex is suitable to host the 2006 Asian Games."
(yan)