Intrusive legislature

Intrusive legislature

Megawati Soekarnoputri's rise to the presidency in July with
strong coalition support created a market belief that her
government would be able to speed up its long-delayed reform
agenda through the House of Representatives.

But what the government has been facing so far is an
overzealous House of Representatives which attempts to intervene
into virtually every program the government is pursuing. This
meddling by the legislature has been so excessive that many
policy measures are stuck in delay after delay at the expense of
the government's credibility domestically and internationally.

Having said all that, we are not suggesting that the House be
as submissive as its predecessors during the authoritarian
Soeharto administration, rubber stamping any proposals from the
executive branch. But what we see now is a House that has swung
from an extremely subservient posture to an overly intrusive one.

Since many reform programs have fallen far behind schedule,
either because of backtracking by the previous administrations or
obstructive meddling by the House, the government often feels
compelled to "buy its way" through the legislature to expedite
things. Hence, allegations have been abound about how particular
ministers made payments, which were disguised in seemingly legal
expense accounts, to House members. Recently, a major controversy
erupted after Rp 10 million worth of traveler's checks owned by
Treasury Director General Anshari Ritonga was found by a cleaner
on the eighth floor of the House building.

The House should certainly exercise effective control of the
government to ensure good governance that is both transparent and
accountable but this responsibility must be done appropriately
within the parameters of the law and the Constitution.

The People's Consultative Assembly (MPR), the country's top
legislative body, has set a five-year plan of broad guidelines on
state policies to direct government operations, and the policies
must be implemented through the annual state budget which must be
approved by the House. Hence, House deliberations on the annual
state budget plan are supposed to be the most efficient and
effective way of controlling governmental operations.

But once the budget plan and its programs are approved, the
House should no longer intervene into every deal or move the
government is making as long as the measures are consistent with
the budget programs, other regulations and budgetary procedures.

The most glaring examples are debt restructuring, asset sales
and privatization of state companies, which are core elements of
reforms and vital to stop the economic bleeding.

The 2001 state budget, which was approved by the House late
last year, clearly details the policy objectives and revenue
targets of those reform measures and also outlines how the
government will pursue them. Terms of reference, procedures and
policy guidelines for these programs have been clearly expressed
in numerous executive rulings.

However, every time the government moves to sell particular
assets or privatize particular state companies, it often becomes
bogged down in endless debates in the House, resulting in
governmental gridlock and, perhaps even more damage is done
because it causes widespread uncertainty about government policy.

Even more astonishing is the seemingly narrow-minded,
nationalistic sentiments among House members even though they
should be fully aware that foreign investors are virtually the
only potential buyers of all the distressed assets. Our economy
is now like a profusely bleeding patient, which desperately
requires a blood transfusion, and the only donors that are fit to
provide the blood are businesspeople and investors from other
countries.

House members may not be aware that the quality of distressed
assets is now deteriorating rapidly due to a lack of lifeblood
(working capital credits) and, that many assets, such as banks,
are kept alive only by funds from the taxpayers (state budget
support).

The House need not worry that foreign acquisition of some
assets or state companies would give overseas investors a blank
check to do whatever they like in our economy. We have laws and
regulations to ensure sound business practices and direct
businesses into the goals of our national development.

After all, we should not forget that it was our corrupt,
collusive national conglomerates, and not foreign companies, that
were partly responsible for our current economic troubles.