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PPSK bill: Govt seeks to curb House clout on BI, other watchdogs
In the deliberation of the financial sector bill, the government has proposed changes that would ban political party figures from sitting on boards of the central bank and other watchdogs after the draft initiated by lawmakers had raised concerns about the bodies’ independence.
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Central role: The Bank Indonesia (BI) logo is displayed on a gate in Jakarta on Sept. 2, 2020. (Reuters/Ajeng Dinar Ulfiana)
T
he government has proposed to the House of Representatives the reinstatement of a ban on political party figures from running for posts at Bank Indonesia and to undo changes suggested by lawmakers that had raised concerns about political influence on other watchdogs.
The proposal is part of the government’s response to the omnibus bill on financial sector development and strengthening (PPSK) drafted by lawmakers.
Revising Article 47 in the BI Law, the proposal by the government would once again prohibit members or leaders of political parties from sitting on the BI board of governors, according to a document seen by The Jakarta Post, undoing a 2004 revision that had eliminated an earlier ban.
A similar ban would apply to the Deposit Insurance Corporation (LPS), where political party members or leaders would be barred from its board of commissioners.
While the House draft would remove a ban on political party leaders that is currently stipulated in Article 67 of the LPS Law, the government proposal, on the contrary, would extend the ban to regular party members.
The government’s proposal also scraps lawmakers’ plans for the House to seize control of the selection process for leaders of the Financial Services Authority (OJK) and the LPS, so as to keep unchanged current rules that involve both the government and the House in the process.
Finance Ministry Fiscal Policy Agency head Febrio Kacaribu, who leads the deliberation from the government side, neither confirmed nor denied the proposal.
