Minister welcomes plan to audit reforestation funds

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)