Leakages found in rice-for-poor projects: Minister

Muninggar Sri Saraswati, The Jakarta Post, Jakarta

An independent monitoring team revealed on Wednesday a clear violation in the implementation of the fuel subsidy compensation program which was supposedly aimed at reducing the impact of higher fuel prices on the poor.

"We are not ruling out possible violations by some of our brothers," said James Hellywarang, coordinator of the monitoring team from 35 universities across the country.

He said that some residents, who did not qualify for the low- cost rice, were still allowed to purchase the subsidized rice, and then turned around and sold it to the poor at higher prices, thus profiting from their poor neighbors.

James chose not to make public the specific data on the violations that they had documented, saying that his team had yet to finished their report.

"But, the percentage is very, very small," he added quickly.

Coordinating Minister for People's Welfare Jusuf Kalla admitted that many of the poor did not get the subsidized rice.

"It's our fault, but we will improve soon as this year's program is not yet complete," he said when asked to comment on the independent monitoring team's statement in a press conference.

Also attending the presentation were Minister of Energy and Mineral Resources Purnomo Yusgiantoro, Minister of National Education Abdul Malik Fajar, State Minister of Communications and Information Minister Syamsul Mu'arif and Minister of Social Affairs Bachtiar Chamsyah.

This year, the government allocated Rp 4.4 billion (US$517,600) for the fuel subsidy compensation scheme in the form of below-market-price rice and other services. The government also has provided similar programs such as inexpensive health services, social services, primary education, higher education, religious education, transportation, water facilities, small- scale enterprise help, coastal people's empowerment and contraception.

Although the program was supposed to begin in January, Kalla admitted that only the rice and education programs had been running for the 12 million or so poor people across the country.

"The government only got around to disbursing the funds in May," he said, adding that the government had not yet disbursed most of the money.

The government has only implemented 11 percent of the program due to financial shortages, he said without elaborating.

The government introduced the fuel subsidy compensation scheme in 2000 to ease the burden of the fuel subsidy phasing-out on low-income people. It has cut off the fuel subsidy in accordance with the IMF bailout program requirements, which has been in effect since 1997.

The government decided to do a check on the use of the funds following reports that some of the money had missed its target group, the poor, in 2001 due to corruption and shoddy implementation.