Small business alowed to procure official goods

JAKARTA (JP): President Soeharto has called for the full enforcement of rulings allowing small businesses and cooperatives to procure goods, equipment or services for government offices.

Minister of Cooperatives and Small Enterprises Subiakto Tjakrawerdaya said Thursday night that the President had ordered Vice President Try Sutrisno to strictly punish those violating the rulings.

"The instruction makes clear that the government is committed to involving small businesses and cooperatives in the procurement of goods or equipment for government offices," Subiakto said in a meeting with members of the Indonesian Chamber of Commerce and Industry (Kadin).

In the meeting, presided over by Coordinating Minister for Production and Distribution Hartarto Sastrosoenarto and Kadin chairman Aburizal Bakrie, Kadin members were briefed about the results of the limited cabinet meeting early this week, which discussed the poverty alleviation program and business partnership between small and big companies.

Also present at the meeting were Minister of National Development Planning Ginandjar Kartasasmita, Minister of Population Haryono Suyono, Minister of Public Works Radinal Moochtar, and hundreds of chamber members from throughout the country.

Subiakto said presidential decree No. 16 of 1994 and presidential decree No. 24 of 1995 gives small businesses and cooperatives a privilege in procuring goods and equipment or providing services to government offices.

The minister said about 30 percent of the annual state budget was allocated for the government's routine spending, including for the procurement of equipment, goods or services.

"But the implementation of the regulations is weak due to the weakness of the monitoring system," Subiakto said.

Subiakto said the Coordinating Ministry for Economy, Finance and Development Supervision had recently issued an instruction to form a new mechanism in supervising the implementation of the regulations.

He said government offices or other related institutions were instructed to report on the implementation of the regulations every three months to secretary generals of each ministry and the reports would be audited by the Development Finance Controller.

Subiakto said the government had also issued a regulation which obliged big companies bidding for government projects to state in their tender applications about their partnership program with small businesses and cooperatives.

The more activities the big companies gave to small business and cooperatives, the bigger their chance to win the tender, he said.

The government would every year issue a directory of projects limited to small business and cooperatives, he said.

Also, the government would issue a regulation specifying the sectors which were respectively limited to small business and cooperatives and also open to big companies provided that they cooperated with small businessmen and cooperatives.

Chairman of the Association of Indonesian Young Entrepreneurs (HIPMI) Bambang Wiyogo said the new policy showed that the government was taking sides with small enterprises and cooperatives.

In the past, despite the regulations on small business and cooperatives privileges, the government did not clearly show its standing toward the groups, he said.

"For me, it (the new policy) is a surprise. It's a new concept of economic policy," he said. (jsk)