Military allowed to sell assets from business ventures
Tony Hotland, The Jakarta Post, Jakarta
The "clearance sale" of assets and properties belonging to Indonesian Military (TNI) foundations and business ventures could last for a month, the Minister of Defense says.
Juwono Sudarsono said on Wednesday the TNI would be allowed to sell certain assets in business ventures before the government officially took over other businesses under the new law.
"Before a presidential regulation is issued, changes of ownership are not a problem as long as the procedures are in line with the law, and the sales are approved by the Ministry of Finance," Juwono told a hearing with the House of Representatives Commission I here.
The presidential regulation will come into effect in early November at the latest. The TNI is still collecting data on its business ventures, although the defense ministry had set a Sept. 26 deadline for the military to complete the job.
Law No. 34/2004 on the Indonesian Military stipulates that the government will acquire all the TNI businesses within five years to create a more professional military that stays away from business.
The legislation has prompted the quick sales of the TNI's assets in some companies, although some believe that those assets belong to the state and should not be sold privately.
The Navy has reportedly released its ownership of several "unprofitable" companies, while the Army's Kartika Eka Pakci Foundation has also sold its 11 percent stake in PT Artha Graha to companies belonging to businessman Tomy Winata, who controls the holding company.
Army-controlled Mandala Airlines is also now on offer, with its sale allowed as long as it followed the law, Juwono said.
Mandala president commissioner Lt. Gen. Hadi Waluyo has hinted he may offer the company to investors because it had suffered losses in the last two years. The plan surfaced after a Mandala plane crashed into a crowded residential area in Medan early this month, killing 149 people.
Juwono could not, however, explain where the money acquired from the sales of military assets would go. "We will review the regulations in order to boost accountability," he said.
Defense ministry secretary general Lt. Gen. Sjafrie Sjamsuddin said every process that did not follow legal procedures would be a serious violation, but would not detail any sales he believed were illegal.
Several House lawmakers urged the TNI on Wednesday not to sell or transfer its assets to any other parties before the enactment of the new military law.
"While not explicitly, the law suggests that the assets should not be transferred until the regulation on which ventures will be taken over by the government is issued. Such sales are against the law," said Commission I deputy Effendi Choirie said.
Another commission member Ade Daud Nasution also criticized the quick sales of businesses by military generals.
The defense ministry is working with the Office of State Minister of State Enterprises, Ministry of Justice and Human Rights and Ministry of Finance to set criteria on military businesses -- either enterprises, foundations or cooperatives -- which will then be handed to the government.
The TNI has earlier said it wanted to keep the foundations and cooperatives under its control to help improve soldiers' welfare, arguing the government provided less than a half of its military budget.