Minister welcomes plan to audit reforestation funds

JAKARTA (JP): Minister of Forestry and Plantations Muslimin Nasution hailed yesterday the government's decision to appoint a public accounting firm to audit reforestation funds collected from timber companies.

The minister said the involvement of public accountants in auditing the reforestation funds would make his ministry's job easier in finding any deviation of funds.

"The audit will ensure more transparency in the collection and use of the reforestation funds," Muslimin told journalists at his office.

The new supplementary memorandum of economic and financial policies signed by the government with the International Monetary Fund Thursday stipulates that the government has to complete international standard audits of reforestation funds by the end of this year.

The IMF requires the reforestation funds, including the interest, to be managed within the state budget and to be used to develop forests and rejuvenate critical land.

The reforestation funds are collected as mandatory fees imposed by the government on forest concessionaires to ensure that forests are managed in an environmentally sustainable manner. The size of a fee depends on the volume and type of timber felled.

Starting April 1, the reforestation funds are accounted for in the state budget as nontax receipts. Previously, the funds were transferred into the Ministry of Forestry's bank account. The allocation and use of the funds were governed by presidential decree.

Muslimin said the ministry had no problem with the finance minister's request to transfer all reforestation funds collected from the timber companies to the state treasury.

"Our question is whether there is any guarantee that the funds will be returned to the forests? So we are still negotiating with the Ministry of Finance to establish a mechanism which will ensure that the funds will be used for forest development," he said.

In another issue, Muslimin said his office was still considering whether to increase the dollar rate for reforestation fees to Rp 10,000 from Rp 5,000 due to a continued drop in the country's currency and to adjust the revised state budget.

But he declined to explain if the new dollar rate would affect unpaid reforestation fees for 1997.

Reforestation fees are currently set between US$12 and $16 per cubic meter depending on the type of tree, but payments are made in rupiah.

In 1996, the government collected Rp 880 billion in reforestation funds. This fiscal year, it is expected to total Rp 1.6 trillion. (gis)