RI returns corrupted US$10 million funds: WB

RI returns corrupted US$10 million funds: WB

Dewi Santoso
The Jakarta Post/Jakarta

The World Bank said on Friday that the Indonesian government had
returned the US$10 million in funds publishers here allegedly
corrupted from the Book and Reading Development Project.

The World Bank announced in Washington last Tuesday that
collusion had led to the procurement of inferior quality books in
a school book project and urged the Indonesian government to
repay US$10 million of some $53 million disbursed.

"We've informed the Indonesian government about the
misprocurement in the project in the second half of year 2003 and
we received the $10 million from the government in January this
year," said World Bank acting country director Joel Hellman.

The Ministry of National Education's director general for
elementary and intermediate school affairs Indra Djati Sidi again
refused to comment on the allegation on Friday.

Hellman further said that the Ministry of National Education
had been cooperative in handling the case, adding that both the
ministry and the World Bank had drawn up action plans together.

As many as 20 private and state publishers and 10 individuals
have been blacklisted from any new World Bank-financed contracts
for a period of debarment as they have allegedly conducted
fraudulent and corrupt practices.

Hellman said the bank had handed the case over to the
Indonesian government to deal with the publishers.

He explained that the bank's Sanctions Committee had started
investigation in 2000, following a report from an article written
in the Indonesian news magazine Tempo, in which allegations of
fraud and corruption in the Book and Reading Development Project
were made.

"The World Bank has a Sanctions Committee, which examines
individual firms that may have been involved in collusion, and
the committee found that there was misprocurement in the
project," said Hellman.

He explained the committee discovered that in each region of
the country, a small group of firms colluded to determine [which
publishers] would win the project.

"They (the publishers) then would make a payment of a certain
percentage to the groups," he told The Jakarta Post.

This, he said, was not how the project should have been run as
the common practice is that it is open to all publishers to
compete against one another to win the project in a transparent
and healthy way.

He added that the Sanctions Committee had contacted the firms
(publishers) about its findings and had issued notices of
debarment to firms and individuals allegedly involved.

"All of the firms and individuals are granted the opportunity
to dispute the charges, but none of them have made any moves,"
said Hellman.

However, the secretary-general of the Indonesian Publishers
Association Robinson Rusdi said it was not true that the
publishers did not reply to the letter.

"They have replied to the letter, but the World Bank acted as
if it received no reply from us," said Robinson.

The Book and Reading Development Project began in October 1995
and was implemented by the Ministry of National Education. It was
partly funded by an International Bank for Reconstruction and
Development (IBRA) loan valued at $132.5 million, which funded
the purchase of textbooks for junior secondary schools.

The government disbursed $40 million from the state budget in
the joint project. The project closed on Dec. 31, 2002, having
disbursed some $53 million of the loan.