Trillions in Forestry Losses Due to Corruption: ICW

Jakarta Globe 30 Apr 10;

Trillions of rupiah has been lost from state coffers as a direct result of corruption and mismanagement in the forestry sector, a leading graft watchdog has said.

“We estimated the shortfall to forestry revenue in Riau province alone from 2002 to 2006 was Rp 1.855 trillion [$205.9 million],” Anggita Tampubolon, a researcher at Indonesia Corruption Watch, said on Friday.

This translates to average annual losses in Riau of Rp 371 billion over the period.

ICW based its calculation on comparisons between official deforestation estimates and production estimates.

Firdaus Ilyas, budget analysis monitoring coordinator for ICW, said the potential losses across the nation were far greater.

“This data comes from just one province,” he said, “and could be duplicated across the country.”

ICW’s finding eclipses recent research by the Supreme Audit Agency (BPK) said losses from Riau’s forestry sector between 2008 and 2009 amounted to Rp 491 million.

The audit factored in illegal mining in forests, unauthorized issuance of concessions, zoning violations, underreporting of forestry earnings, failure to collect on those earnings and embezzlement.

To combat graft, ICW recommended an overhaul of policy to grant concessions, greater transparency in forestry earnings, improved revenue collection and more stringent law enforcement.

“The government needs to seriously follow up on reports like the BPK’s or from local communities,” Firdaus said.

Meanwhile, Wirendro Sumargo, executive director of Forest Watch Indonesia, said ICW’s report did not take into account the vast losses on top of the shortfall to state coffers.

“The ecological cost itself is much higher than that — about Rp 2 trillion,” he said. “You need to take into account the environmental services or biodiversity lost as well.”

Wirendro said combating corruption in the sector would not be easy. “It won’t be apparent on the perpetrators’ bank accounts because of the nature of how they work,” he said. “Most perpetrators just get an administrative slap on the wrist and never face corruption charges.”

ICW’s Anggita acknowledged the difficulty, but said the BPK’s audit opened the way for strong action to be taken. “The audit revealed losses to the state, and under the corruption law that’s grounds for prosecution,” she said. 

Antara, JG

Old Logging Cases to Get New Look
Jakarta Globe 30 Apr 10;

The Judicial Mafia Eradication Task Force is likely to probe several illegal logging cases halted by police or prosecutors, including the controversial acquittal of businessman Adelin Lis, an official said on Friday.

“Many cases will now likely be re-examined for the possibility that they were not properly handled,” task force secretary Denny Indrayana said after meeting North Sumatra Police Chief Insp. Gen. Oegroseno and provincial chief prosecutor Sutiono Usman Aji.

Police spokesman Sr. Comr. Baharuddin Djafar told the Jakarta Globe that among the many illegal logging cases discussed at the meeting was that of Adelin.

The businessman was acquitted of illegal logging charges last year by the Medan District Court and fled the country before prosecutors could lodge an appeal, despite him being under a travel ban.

“The task force is looking into why Adelin was acquitted,” Baharuddin said. “Police found a lot of incriminating evidence in his case, but some of it was never presented by the prosecutors in the trial.”

Officials from the North Sumatra prosecutor’s office could not be reached for comment.

The focus on illegal logging comes after a coalition of nongovernmental organizations last week reported 12 public officials to the task force for halting investigations into 13 pulp-and-paper companies accused of illegal logging in Riau, also on Sumatra Island.

During a meeting with the task force on Wednesday, Forestry Minister Zulkifli Hasan said illegal logging and farming were responsible for the clearing of about two million hectares of forest nationwide annually. He also told the task force his ministry was “probing a big case in Padang Lawas, North Sumatra,” but declined to elaborate.

Indonesia Corruption Watch researcher Anggita Tampubolon said the so-called forestry mafia had cost the state trillions of rupiah through illegal logging.

“Legitimate companies often purchase timber from illegal loggers,” she told the Globe. “Law enforcers often only net the small logging companies, while the major ones go untouched.

“The bribery comes in when the companies try to whitewash the illegally logged timber by getting local government officials to issue traceability certificates.”

Anggita added that although police could charge the legitimate companies with possession of illegally obtained goods, such instances were rare. “Instead, the big companies profit every time police confiscate logs from smaller companies because [they can buy them when] they’re auctioned off at way below market price,” she said.

Usman Hamid, chairman of the human rights group Commission for Missing Persons and Victims of Violence (Kontras), said logging and oil palm companies were also responsible for driving many villagers off their land.

“The task force should also question local government officials who unilaterally issue concessions to these companies,” he told the Globe.

Usman cited the 2004 eviction of 839 families from Central Tapanuli district. In that case, the government had granted the villagers cultivation rights to the area in 1983, but later revoked it and instead signed over the land to an oil palm company.

“These villagers became victims of intimidation and physical abuse by rogue public officials,” Usman said.

“Cases like this abound in North Sumatra. There are thousands of families there who have been ordered to vacate their homes without any compensation.”