THIS WEEK'S HEADLINES

Monday, June 22, 2015

President Joko Widodo explicitly reject KPK Law revision. In fact, the President would withdraw the revision proposal altogether from the National Legislation Program (Prolegnas) of 2015.

The revision of KPK Law was in fact a barter between the government a DPR. The exchange was negotiated involving Revision of KPK Law and Government Regulation in Lieu of Law (Perppu) No. 1/2015. KPK Law Revision is DPR's precondition in order to approve Perppu on the appointment of the Acting KPK Commissioner.

KPK wiretapping authority was again proven effective with the arrest of four suspects in the bribery for the two legislators in Musi Banyuasin. During the arrest, KPK also confiscated a bag of money that amount up to around Rp 2.56 billion in Rp 50,000 and Rp 100,000 denominations.

Tuesday, June 23, 2015

DPR Budget Chamber (Banggar) doubt aspiration fund program proposal could be implemented optimally since the concept was poorly and hastily prepared.

KPK had named four suspects in the bribery case of Musi Banyuasin local budget manipulation. KPK continue to develop investigation since there are strong indications that the transaction took place with instruction from their superior officers, namely Regent of Musi Banyuasin.

DPR and Vice President Jusuf Kalla endorse KPK Law revision despite the President's disapproval to the revision. The revision is widely criticized as a design to weaken KPK because it propose to cutback KPK's wiretapping authority, which is regarded as KPK's soul. If this authority is mutilated, it is feared that KPK will no longer have capacity to arrest corrupt officials that are still running loose.

KPK questioned three district councilmen from Commission E of DPRD DKI Jakarta in their investigation of UPS procurement, in which the state lost an estimated Rp 50 billion, namely Asraf Ali, Iman Satria, and Lucky Satrawirya.

Dahlan Iskan had to answer about 50 questions Bareskrim investigators to clarify documents of high speed diesel fuel procured by PLN in 2010. His lawyer, Yusril, believed Dahlan Iskan is not involved in any corruption allegations.

Wednesday, June 24, 2015

Aspiration fund moved ahead and passed by DPR although not unanimously. Many warned that aspiration fund is highly likely to be a new source for corruption. Public are now awaiting government's response, whether to accommodate DPR or to listen to public outcry and dismiss the proposal?

The President's commitment is also needed to dismiss DPR's proposal to revise KPK Law. The draft regulation had been unanimously passed by the parliament, in spite of the President's previous objections.

The Department of Public Works (PU) in Musi Banyuasin allegedly played a role to manipulate local budget (APBD-P) for 2015. Allegedly, the department took bribery in relation with national road improvement project that has a budget of Rp 59 billion.

Selection panel for KPK leadership (Pansel KPK) extended registration of candidates until July 3, 2015. The extra time was required since some candidates need to follow lengthy procedures in acquiring documents, such as legalized diploma from abroad.

Acting Deputy Chairman of KPK, Johan Budi, submitted his registration as candidate for KPK leadership in 2015-2019. Johan asserted that he enter the candidacy because he feels that the excellence of KPK is starting to fade.

Thursday, June 25, 2015

The Government has refused the parliament's proposal for aspiration funds because it is considered to contradict the administration's Nawacita/nine priority programs and parliament have no mandate to manage budget, which is an executive authority.

Police Chief Gen. Badrodin Haiti requested a similar free wiretapping authority as the KPK for his institution. KPK currently have authority to wiretap without a court order.

Contractors for the building renovation of the Secretariat General of the Ministry of Energy and Mineral Resources (ESDM) in 2012 were apparently only “borrowed” names used to manipulate Presidential Decree No. 54 of 2010 about Procurement. This was revealed in court while hearing testimony of witnesses

Friday, June 26, 2015

The President and his administration had refused to accommodate DPR's proposal about aspiration funds. The Government believes that global economy is in turmoil, with direct impacts in Indonesia, thus existing and planned budget must be optimized and it is impossible to add new budget items beyond the planned programs.

The President also reiterate his blatant refusal to revise KPK Law, that many had warned would decapitate KPK. The Government asserted that the people should not doubt the administration's commitment to eradicate corruption. Moreover, there are other more urgent legislations that require DPR's attention in the National Legislation Program 2016 aside from the KPK Law revision.

During trial of alleged corruption in ESDM Ministry, a witness testified that there was a deposit of USD 140,000 paid to Didi Dwi Sutrisnohadi, Head of Finance at the Ministry.

Former Minister Jero Wacik was intensely questioned by investigators in relation to Minister's fund. While he could not answer all questions asked, Jero Wacik maintained the same answer, that he had not misuse Minister's fund for personal interests.

KEY DEVELOPMENTS

June 22

- DPR barters KPK Law revision with Perppu legislations

- KPK wiretapping authority proven effective

June 23

- DPR Budget Chamber doubts aspiration fundings

- DPR and Vice President agree to revise KPK Lawsuits

- Three local councilmen questioned in UPS corruption case

- Dahlan Iskan questioned in fuel procurement case

June 24

- DPR passed Aspiration Fund initiative

- DPR unanimously passed KPK Law revisions

- Candidate registration for KPK commissioners extended until July 3

June 25

- Aspiration Fund said to contradict Nawacita

- Police Chief wants free wiretapping authority, like KPK

- Fictitious partners revealed in ESDM Ministry corruption case

June 26

- President rejected Aspiration Funds proposal

- President rejected KPK Law revision

- Trial of alleged corruption in ESDM Ministry revealed deposit payment submitted to Ministry's Head of Finance

IN-DEPTH ANALYSIS

Aspiration Fund: New Mine for Political Financing?

After a long and heated controversy on aspiration funds that was settled in a plenary session, House of Representatives (DPR) members doggedly elected to give themselves IDR 20 billion each.

Earlier, the parliament demonstrated consultation with various parties, including Corruption Eradication Commission (KPK) and the government, to gather advice on the matter. Both institutions recommended that DPR should not insist on allocating aspiration funds in state budget since it was believed to be prone to corruption (Koran Tempo, June 25, 2015). As always when making public policies in DPR, a hearing is mere formality to justify the parliament's decision, which ultimately based solely on their own interests and logics. At least, DPR had demonstrated a mechanism for participation in the process.

The base argument of DPR's approval is development equality. DPR flatly denied that the fund would be prone to corruption because program proposal for its use must be discussed between DPR and the government. State Audit Office (BPK) and KPK would also be engaged to monitor its use. Technically, DPR requested the funds to be included in Special Allocation Fund (DAK).

KPK themselves suggested that DPR delay the approval of the funds because, technically, DPR can not present a comprehensively transparent system. While Interior Minister Tjahjo Kumolo was unconvinced that the fund would actually create development equality since DPR members are mostly from Java (306 seats), while Bali, NTB and NTT have 32 representatives. Maluku and Papua have only 17 representatives. Rather than achieving development equality, city-bias and centralistic development in Java will only cement Java's central position. In itself, the concept contradicts with the Nawacita ideals of President Joko Widodo's administration which envision a national development that begins from rural areas and eastern regions. Budiman Sudjatmiko, a parliamentarian from PDI-P believes that aspiration funds would also contradict with the village fund program which is he described as the essence of development decentralization concept.

The question is, why would the majority in DPR eventually approve the proposal in spite of these general objections? The answer lies, most likely, in two aspects. First, DPR had begun to feel uneasy when they use illegal mechanism in order to secure political fundings. The sheer number of parliamentarians who had been caught red-handed by KPK for budget manipulation could provide a strong motivation to provide themselves with legal access to public funds. Their fears became even more apparent after their concerted persistence to revise KPK Law, particularly focusing on articles related to KPK's authority in interception, investigation and prosecution.

The second reason would be the increasing pressure to have a bigger purse in order to campaign their rerun as parliamentarians. Although the amount required can not be verified due to poor reporting system of campaign fundings, many estimate that campaign funds for a seat in DPR can amount up to billions of rupiah. With the aspiration funds, at least the incumbents will have resources to rerun and win their campaign because they can easily use aspiration funds for disguised campaign activities. The implication of this argument would be the shrinking opportunities for prospective new parliamentarians to enter the contest, where in turn a new candidate would have to provide bigger campaign funds in order to have a seat in DPR. ***