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)