Sutiyoso denies knowledge of 'incentives', vows probe

JAKARTA (JP): Governor Sutiyoso vowed on Friday to investigate allegations that city-owned companies made under-the- table payments worth hundreds of millions of rupiah to auditors from the Development Finance Comptroller (BPKP).

"Such practices should not be conducted. This is no longer the time," he said.

Despite an executive's statement that the governor was fully aware of the practice, Sutiyoso insisted the firms were not permitted to make an unaccounted outlay from their budget.

It was "unnecessary", he added, for the auditors to receive the payments outside of their regular salary because the audits were part of their job duties.

In a hearing at the City Council on Thursday, president of city-owned market operator PD Pasar Jaya Syahrir Tanjung admitted the firm paid "incentives" totaling Rp 60 million to BPKP officials who audited the firm's 1997 financial report.

"It's normal. It's for their time auditing our firm, which took eight months," Syahrir said after meeting with members of Commission B for economic affairs.

He declared the practice occurred with Sutiyoso's knowledge and approval.

The governor claimed on Friday to know nothing about the payments, but offered that it could be a legacy of the rampant corruption in the bureaucracy in the past.

"I have no idea. But it might be (part of the) old tradition."

Syahrir's statement angered many councilors, particularly after they learned that the 10 BPKP auditors were paid in December last year at the height of the reform movement to eradicate corruption, collusion and nepotism.

The city owns at least 60 companies.

Many also believe that the firms make similar payments to auditors from the city inspectorate and tax offices.

Councilor Lukman F. Mokoginta called on Friday for a serious investigation of the allegations.

"It's an economic crime," Lukman said.

Sutiyoso said he ordered deputy governor for administrative affairs Abdul Kahfi, who also heads the city's reform team, to probe the matter.

"I have already asked Pak Kahfi to report to me soon after the completion of his investigation," he said.

The governor established the reform team in June 1998 to rid the administration of corruption, collusion and nepotism in the city administration. (jun)