T

he House of Representatives has announced plans to have the Supreme Audit Agency (BPK) conduct an audit on Bank Indonesia to anticipate the imminent economic crisis brought on by the rupiah'€™s decline in value.

House speaker Setya Novanto said on Wednesday that he has asked Commission XI overseeing finance and banking to commission a special audit (PDTT) by the BPK on the central bank following the Indonesian currency'€™s continued slide against the US dollar.

The rupiah passed the significant 14,000 mark against the US dollar on Monday for the first time since the 1998 financial crisis.

'€œWe have asked House Commission XI through Fadel [Muhammad] to hold talks with the BPK in preparation of the special audit,'€ Setya told reporters at the House complex in Jakarta.

According to the Golkar Party politician, the rupiah'€™s depreciation has a significant effect on the state budget, which is why the government and all relevant stakeholders need to act swiftly and appropriately.

The audit would be used to anticipate the dollar'€™s continued surge against the rupiah, Setya said. He added that hopes were high for the BPK to provide insight into the current monetary conditions in terms of the central bank'€™s preparedness and whether it had taken the necessary steps to alleviate the situation.

The House speaker also said that representatives from the central bank were being summoned to provide input and clarify the current situation.

Commission XI chairman Fadel Muhammad told The Jakarta Post on Wednesday that he agreed in principle to the commissioning of the audit, as long as it did not weigh down on the current economic conditions. He said that the commission would meet with the BPK later at night.

Fadel, also a Golkar Party politician, previously told the media that it would be better to put faith in the work of the central bank, the Financial Services Authority (OJK) and the government'€™s economic team, especially at such a crucial moment like this.

Another Commission XI member, Golkar politician Mukhamad Misbakhun, said that it was important for the BPK to audit BI to ensure that there were no conflicts of interest.

'€œIt is the central bank'€™s duty to manage foreign exchange reserves, which is important for the rupiah'€™s stability. The fact is that BI is also the largest taxpayer in foreign exchange gains,'€ Misbakhun told the Post on Wednesday.

'€œThere is a moral hazard involved and transparency is key to assessing the performance of monetary policies.'€

Meanwhile, House deputy chairman Agus Hermanto of the Democratic Party urged the government to focus on reinvigorating the economy in the short term, such as by providing direct subsidies to the lower and middle classes that would help maintain their purchasing power as the rupiah weakens.

'€œThe economy is currently falling drastically '€” we might have a crisis on our hands if we don'€™t act accordingly. At least we should work toward a recovery against the dollar and for the lower-middle class, so they can still afford a decent life,'€ he said on Wednesday.

On the legislators'€™ end, Agus said the House was working hard to expedite the Financial System Safety Net (JPSK) bill for completion this sitting period. '€œWe have to push this piece of legislation for this period. Hopefully it will help push the economy back up,'€ Agus said.

Fadel said that Commission XI would work hard to finish the deliberation of the bill before the sitting period ends on Oct. 31.

On Tuesday, Finance Minister Bambang Brodjonegoro officially submitted the JPSK bill, consisting of 51 articles, for the House to deliberate.

Discussions on the JPSK bill are centered on the need for Indonesian policy makers to possess a strong legal framework in the country'€™s crisis management protocol.

The law is expected to assist policy makers with making decisions during times of crisis, such as when bailing out banks or declaring failed banks, as what happened in the Bank Century bailout case in 2008.