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Jakarta Post

Bribery rampant in state projects: Witness

About 50 visitors attended the high-profile corruption trial, which allegedly involved many political elites in the country, at the Jakarta Corruption Court on Friday morning

The Jakarta Post
Jakarta
Sat, August 6, 2011 Published on Aug. 6, 2011 Published on 2011-08-06T08:00:00+07:00

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bout 50 visitors attended the high-profile corruption trial, which allegedly involved many political elites in the country, at the Jakarta Corruption Court on Friday morning.

Some of them sighed when a key witness explained to the presiding judge that bribery was a very common practice in the government procurement business.

PT Duta Graha Indah (DGI) president director Dudung Purwadi said that his company had to bribe many government officials to win a contract to build the Southeast Asian (SEA) Games’ athlete’s village in Palembang.

“Many other companies, not only us, do such things when it comes to government procurement projects,” Dudung said.

Speaking as a witness in the trial of defendant Mindo “Rosa” Rosalina Manullang, Dudung told the panel of judges that “success fees” paid to state officials who helped companies win contracts “has become a general tradition”.

Dudung, whose company won the contract to build the athletes’ village in Palembang, South Sumatra, worth Rp 191.7 billion (US$ 22.4 million), said that his company had made a deal with Rosa, who acted on behalf of ousted Democratic Party politician Muhammad Nazaruddin, to disburse 20 percent of the project value as “a success fee”.

Dudung said that Rosa in particular spoke about the fees to PT DGI marketing manager M. El Idris, who was later also named a suspect by the Corruption Eradication Commission (KPK).

“We didn’t propose the success fee. Rosa did,” he said. He said as an initial agreement, the company was asked to prepare a success fee of 18 percent of the value of the contract, for Nazaruddin, the procurement committee, the regional government of South Sumatra, and Rosa herself.

However, Dudung said that there was an additional success fee, of 2 percent of the project value, allocated for Youth and Sports Ministry secretary Wafid Muharram.

“Rosa said that he [Wafid] wanted to have a share of the fees,” he said.

Dudung said that the athlete’s village project, which his company won in December last year, was not his first “deal” with Nazaruddin. “We have had several projects before, but I cannot remember precisely the number of the projects,” he said.

The NGO Indonesia Procurement Watch (IPW) announced last year that 92.7 percent of the 792 goods and services providers in Greater Jakarta had admitted to having bribed government officials to win procurement contracts.

The survey said that the dirty practices had become entrenched in the system over a period of years, and could not be eradicated.

“Those who are arrested for procurement-related crimes are the unlucky ones,” it said.

A recent study by the KPK concluded that up to 40 percent of all procurement funds were misused.

This year, 30 percent of the state budget of Rp 1,250 trillion was allocated for procurements.(lfr)

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