Telkom has yet to fulfill preconditions of rate hike

Telkom has yet to fulfill preconditions of rate hike

Arya Abhiseka, The Jakarta Post, Jakarta

The government and state-owned telecommunications company PT
Telkom have not yet fulfilled most of the preconditions
stipulated by the House of Representatives for the approval of
the increase in telephone rates.

Therefore the higher rates that came into effect early this
month were not legal, an analyst said on Wednesday.

Roy Suryo told reporters the Directorate General of Post and
Telecommunications and PT Telkom had only met two of the
preconditions, namely a total increase limited to 45.49 percent
to become effective between 2002 and 2004 and the formulation of
the annual increase.

He said other prerequisites required by the House that had yet
to be fulfilled included the formation of an Independent
Regulatory Body (IRB) that will monitor telecommunication policy
and protect consumers' interests with regards to rates and
charges related to interconnect telephone companies.

"There is not even a concept of such a regulatory body yet,"
said Suryo.

Director General of Post and Telecommunications Jamhari Sirat
said last November that the draft regulation on the establishment
of the body was to be completed before the end of last year but a
staff member from his office said on Wednesday that the
regulation was not ready.

"The IRB must first function before the increase is imposed,
because that body should analyze the rate of the increase first,"
Suryo added.

Suryo said PT Telkom also had failed to properly inform the
public about the percentage of the increase.

"Telkom claims that the tariff increase averaged 15 percent,
leading the general public to assume that the overall increase in
charges was only 15 percent, while in reality local calls rose by
33.3 percent, he said.

In fact, the 15 percent average increase was made up of a 33.3
percent hike in local calls, 31.10 percent in the monthly
subscription fee and 3.97 percent reduction in long distance
calls.

"A farmer who rarely uses the long distance service has not
been properly informed that the local call service he most
frequently uses has been raised by 33.3 percent," Suryo added.

Gatot Dewa Broto of the Directorate of Post and
Telecommunications admitted there was confusion over the
increase, and urged PT Telkom to immediately conduct a proper
campaign. "It is really important for PT Telkom to inform the
public."