President to help select SOE execs
Rendi A. Witular, The Jakarta Post, Jakarta
President Susilo Bambang Yudhoyono will from now on directly select candidates for state-owned enterprises' (SOEs) management to prevent political parties and other groups from infiltrating SOEs and turning them into their cash cows.
Presidential spokesman Andi Malarangeng said on Tuesday that the President had issued Presidential Instruction No. 8/2005 on the selection of directors and commissioners for SOEs, stating that the president will be directly involved in the selection process for the executive posts.
"From now on, the selection of SOEs management will be stricter than before. It's to ensure that the people who run the SOEs will perform well and be of high integrity," said Andi at a media conference at the State Palace.
The instruction stipulates that SOE management candidates selected by the Office of the State Minister of State Enterprises should be approved by the final assessment team (TPA) before they are inaugurated.
The team members will include the President, the Vice President, the state minister of administrative reforms, the Cabinet secretary, the state minister of state enterprises, the chief of the National Intelligence Agency (BIN) and other relevant ministers.
The TPA will also help select candidates for top government posts in public services, the military and police.
At present, the candidacy for top posts at SOEs is fully under the responsibility of the Office of the State Minister of State Enterprises. Previously, a deputy at the state minister's office could directly select and inaugurate new managements for SOEs without having to consult the president.
Such practices have been blamed for the SOEs' poor performance since most selected managements have direct links with political parties and other groups, making the SOEs a cash cow for them.
The issuance of the presidential instruction is in line with the upcoming selection of managements for some strategic and profitable SOEs, including Bank Mandiri, Bank Negara Indonesia, Bank Rakyat Indonesia, Bank Tabungan Negara and state oil and gas firm Pertamina.
The new government has thus far replaced the management of national flag carrier Garuda Indonesia and pension fund management PT Jamsostek. However, it remains unclear whether the appointments were approved by the President.
Sources at the House of Representatives said a number of political parties were vying to have their candidates placed at SOEs, especially at Bank Mandiri, to enable them to gain financial support to fund their operations and for preparing for the 2009 general election.
State Minister of State Enterprises Sugiharto acknowledged that the presidential instruction was aimed at preventing political interests from misusing the SOEs.
"The aim is to make the selection more ideal. We don't want any political interest in SOEs. It is time now to make the enterprises perform and benefit the country," he said.