Tue, 18 Apr 2000

Parties out to exploit state firms: Sources

JAKARTA (JP): State companies remain highly vulnerable to exploitation as cash cows for political groups like they were under previous political administrations, informed sources said on Monday.

Officials at the Office of the State Minister of Investment and State Companies Development Laksamana Sukardi disclosed that many vested-interest political groups aggressively lobbied to have their choice of representative appointed to boards of directors of state companies.

The sources, who requested anonymity, said Laksamana was increasingly frustrated because his drive to clean up state companies from corruption was often undermined by politically well-connected officials in his own office.

They added that some top officials at Laksamana's office were found to have misused the minister's name for payment or other forms of personal favors from state companies' management.

Laksamana's predecessor, Tanri Abeng, who is now a suspect in a corruption case related to the Bank Bali scandal, also expressed concern over what he called the use of state companies as a political instrument.

"I heard several state companies' directors complain of uncertainty about their real function due to strong intervention from outside to make the public companies a political instrument for certain groups," Tanri said in Bandung over the weekend.

He added the practice must be stopped or state companies would become uncompetitive and eventually be edged out of the market.

Several members of the House of Representatives also have expressed concern that many state companies were managed by corrupt officials appointed during Soeharto's administration.

"It is deplorable that not all senior officials at Minister Laksamana's office fully support the cleanup campaign at state companies," Didi Supriyadi of the House finance and budget commission said.

Didi said what has been dubbed the fit-and-proper test conducted to screen professional managers with high integrity for state companies' boards of directors appeared to have been manipulated by some political groups to ensure their choices were picked.

Another House member, Usman Ermulan, recommended that independent assessments be assured through the selection of personnel for state companies' boards of directors under clear- cut guidelines by an interministerial team.