Thu, 29 May 2003

Planned bill to secure Bappenas' legal authority

Dadan Wijaksana, The Jakarta Post, Jakarta

The National Development Planning Board (Bappenas) plans to draft a bill on economic development that will allow it to retain its role in drawing up the country's short and medium-term development programs, including the annual state budget.

The plan was divulged by State Minister for National Development Planning/Bappenas chairman Kwik Kian Gie on Wednesday, during a meeting with House of Representatives Commission IX for state financial affairs.

Legislators voiced support for the plan, saying the bill, when passed into law, would provide a strong legal basis for the continued existence of Bappenas.

"We agree on the importance of a stronger legal basis, in the form of a law, for the national development planning system," the chairman of Commission IX, Max Moein, said following the hearing with Bappenas.

The recent enactment of the state finance law created uncertainty over the fate of Bappenas. According to this new law, Bappenas would no longer play an active role in drawing up the government's annual state budget, with the finance ministry taking complete control over drafting the budget.

The state finance law also stipulates that Propenas, a five- year development program prepared by Bappenas, which in the past has been used as the main reference point for drafting the state budget, is no longer suitable or realistic within today's fast- changing economic framework.

According to the state finance law, the Propenas would be replaced by a document called the Medium-Term Expenditure Framework (MTEF), which would be an economic guide for a three- year period.

This raised speculation that the once-powerful Bappenas would either be dissolved or its role drastically shrunk.

The state finance law was drafted by the finance ministry and was approved by a special House committee, which included a number of Commission IX lawmakers.

Sources say President Megawati Soekarnoputri did not sign the law, but it has nevertheless come into effect because it has been over a month since it was approved by the House.

Kwik refused to provide details of the planned law on national economic development planning, saying that everything was still being assessed.

During the hearing, however, while all of the legislators supported a continued role for Bappenas, a few of the lawmakers questioned how the agency could best be utilized in the future.

One legislator suggested that Bappenas would be much more beneficial if it became independent instead of being part of the government structure.

Bappenas, established 40 years ago, in the past, particularly during the administration of president Soeharto, was a very powerful agency as all key projects had to pass through the office for approval.