No kickbacks no business for printing company
No kickbacks no business for printing company
JAKARTA (JP): City councilors, in a scathing attack on city
officials, said Tuesday many agencies under the city
administration avoided giving orders to a city-owned printing
firm because of poor prospects of getting kickbacks.
"As a matter of fact, there are some gubernatorial decrees
requiring them to deal with the firm. As it turned out, they
(municipal agencies) did not pay heed to any of them," Helmy AR
Syihab, chairman of the City Council's commission B on finance
said.
PT Bumi Grafika Jaya, located on Jl. MT Haryono, South
Jakarta, is a joint venture between the city administration and
the Marga Jaya Foundation, where the former reportedly has 88
percent of the firm's share.
Helmy said the firm, which was founded in 1972, remains in
limbo after being left out in the cold by almost all municipal
agencies. Reportedly the agencies seemed to prefer dealing with
private firms from which they have a better prospect of getting
"commissions."
"Being close to bankruptcy, the firm can today barely pay its
property tax and the salaries of its 88 workers," Helmy said
during an inspection visit to the firm.
The turnover of the firm totaled Rp 1.3 billion (US$606,626)
in 1993/94.
He said the firm is now in desperate need for injection of
fresh funds totaling Rp 3 billion (US$1.39) from the municipality
so it can revamp itself with modern facilities to compete with
private print companies.
All the facilities are reportedly as old as its establishment.
BOT
Helmy said he supported the existence of the firm as well as
its need for more funds but he proposed the firm be relocated to
the outskirts for the purpose of raking in more profit.
"With no profit at all, the company will find it difficult to
even pay its property tax since the price of land in the area is
already quite expensive," he said.
The land in the area, which is among the most expensive area
in the city, is reportedly worth Rp 3 million ($1,399) per square
meter.
The city councilor proposed that the municipality offer the
1.2-hectare to private companies under the BOT (Build-Operate-
Transfer) scheme where under the city master plan the companies
can build either hotels or office buildings there.
"For a print company, it is not necessary to have a location
in such a strategic location as it is now. The firm still can
operate effectively on the outskirts," said Helmy.
Flurry of decrees
Bumi Grafika Jaya, he said, has advantageous edge over its
competitors based on a series of gubernatorial decisions.
The former governor Ali Sadikin first issued the first of many
decrees in 1974, stating that the orders for printed material by
municipal agencies must be rendered to the firm.
Aware that very few agencies complied with the decree, his
successor Tjokropranolo issued another decree in 1979 with
similar content. This was followed by another, similar decree of
1983, issued by his successor Governor R. Suprapto.
The same situation prevailed with Suprapto's successor, as
well as the two governors who came after him. All three of them
also issued decrees.
The latest, but probably not last, decree came from Governor
Surjadi Soedirdja. His, issued in 1993, stated that the firm must
be involved in each tender for supplying printed material to all
municipal offices, whose funds are taken from the routine and
development budget.
If Bumi Grafika Jaya fails in the tender, reads the decree, 50
percent of the contract must be rendered to the firm at the same
price as the firm which wins the tender has offered.
The private firm can completely possess the contract only if
Bumi Grafika is not even capable to run 50 percent of the
contract at similar price. (jsk)