Official says fuel coupon system is safe from misuse

Official says fuel coupon system is safe from misuse

JAKARTA (JP): The coupon system designed by the government to
protect public bus passengers and poor families from the increase
in fuel prices is safe from misuse, a top government official
said on Monday.

Arifin Takyan, a member of the government's information team
for fuel and electricity subsidies, said the fuel coupons would
be distributed in such a way that only poor people would obtain
them.

"First of all, the coupons are not for sale, but would be
distributed for free to those people entitled to government fuel
subsidies," Arifin, who is also oil and gas expert staff to the
Minister of Mines and Energy, said in a press briefing.

The coupons will be printed monthly in different colors. Each
color is valid for one month. This is to help discourage people
from stocking or reselling the coupons.

The government will introduce the coupon system to protect
public bus passengers and poor families from the increase in fuel
prices, planned in tandem with the government's efforts to cut
fuel subsidies for the April-December 2000 state budget.

Fuel coupon holders are entitled to buy fuel at the current
price level.

The government has announced that as of April 1, the price of
Premium gasoline will increase to Rp 1,150 ( 15 US cents) from Rp
1,000 per liter, automotive diesel oil to Rp 600 from Rp 550 per
liter, industrial diesel oil to Rp 550 from Rp 500, kerosene to
Rp 350 from Rp 280, and bunker oil to Rp 400 from Rp 350 per
liter.

The government initially proposed a 20 percent hike in fuel
prices with a fuel subsidy of Rp 18.3 trillion, but later revised
it to 12 percent with a fuel subsidy of Rp 22.4 trillion.

Arifin also suggested that counterfeiting the coupons would be
difficult, since they would be printed by the reliable state
owned securities paper and bank note printing company Peruri.

He also said people would also not be tempted in trying to
make fake coupons due to the small margin for profit.

"For instance, the price difference of subsidized and
unsubsidized kerosene is only Rp 70. One must further slash this
margin to attract buyers."

Arifin did stress, however, the importance of social control
in the use of the coupons, especially for the kerosene coupon
which will be distributed in remote villages.

Regarding the gasoline coupon, he said public transportation
drivers could only use them at public gas stations where the
gasoline would be filled directly into the tanks of their
vehicles.

"It would be difficult to stock the gasoline and sell it
somewhere else," Arifin said.

He also stated that the central government would distribute
the coupons to public transportation owners through the regional
Land Transportation Control Agencies (DLLAJR) in accordance with
their monthly consumption.

The government estimated fuel consumption for public minivans
to be 13 liters per day, while buses are 67 liters per day.

One premium gasoline coupon allows drivers to buy 12 liters of
gasoline at a cheap price, while an automotive diesel oil coupon
is valid for the purchase of 20 liters.

Arifin said gas stations will first buy fuel from the state
oil and gas company Pertamina at normal rates, but they would be
able to reimburse the fuel coupon at Bank Rakyat Indonesia (BRI),
Bank Negara Indonesia (BNI) and Bank Mandiri.

Arifin added the government kerosene coupons would be
distributed to some 17.4 million poor families registered with
the coordination team of social safety net programs via their
regional governments and subdistrict offices.

According to him, a family will receive a quota of 12 liters
of kerosene per month, with each coupon valid for the purchase of
one liter.

Arifin admitted the government could not guarantee the success
of this new subsidy scheme.

"We'll give it a three month trial period," he said.

After this probationary period the government and the House of
Representatives will evaluate the results and decide whether to
replace the scheme with a new one. (bkm)