House urges Sugiharto to curb corruption

House urges Sugiharto to curb corruption

Rendi A. Witular, The Jakarta Post, Jakarta

Lawmakers questioned State Minister of State Enterprises
Sugiharto on Tuesday about his seriousness in tackling corruption
at the ministry and in the country's 158 state-owned enterprises.

In the first meeting between the minister and the House of
Representatives Commission VI overseeing trade, industry, and
SOEs, at least five legislators questioned the integrity of
Sugiharto, his deputies and the candidates he proposed for senior
posts.

Yusron Wachid, of the Golkar Party, urged Sugiharto to explain
allegations of misconduct from an incident in 1999 when he was
the chief financial officer of publicly listed energy firm PT
Medco Energi Internasional.

"Sugiharto needs to be perceived as a clean figure with high
integrity in order for him to effectively lead the fight against
corruption. He also should also clarify the situation regarding
allegations of misconduct," Yusron said.

"We do not want the management of our SOEs falling into the
wrong hands," he said.

Rakyat Merdeka earlier this month reported that Sugiharto was
accused of involvement in a fictitious transfer of shares by a
foreign-owned company, John Koh & Co.

The problem was settled with both parties agreed to an out-of-
court settlement before the case was taken to court in Singapore.

Sugiharto has played down the reports of a dispute and said
such allegations had come from people aiming to discredit him.

He is expected to provide the commission with a written report
about the matter later this week.

Efiyardi Asda, of the United Development Party, said Sugiharto
should immediately dismiss his current deputies, who were
allegedly involved in graft offenses, if he wanted to set a good
example of clean governance.

"I have received reports that the current deputies have been
involved in corrupt practices. It is public knowledge these
officials have often received "levies" from the management of
state port operators," Efiyardi said.

Many of the country's SOEs have long been poorly managed and
deliver low rates of return on investment and equity due to
interference by political interests, which illegally siphon off
money from the businesses.

Idealisman Dachi of the Democratic-Pioneer-Star party faction
warned Sugiharto that all new deputies should be scrutinized so
as to ensure the SOEs were managed honestly.

"There is a report that some of the proposed deputies are
those who have a close links with a corrupt former economic
minister from the New Order regime.

"We would be deeply concerned if this report proved to be
true," Idealisman said.

SOEs with largest losses in 2003

No. SOEs Net losses (in millions of rupiah)

1. Perusahaan Listrik Negara (PLN) 3,558,348

2. Perusahaan Perdagangan Indonesia 418,224

3. Pelni 382,446

4. PANN Multi Finance 152,258

5. Indofarma 129,570

6. Industri Sandang Nusantara 114,772

7. Kertas Kraft Aceh 108,442

8. PTPN II 96,166

9. Inhutani I 90,972

10. Cipto Mangunkusumo General Hospital 81,221

Source: Office of State Enterprises