T

he government’s relationship with the country’s start-ups has drawn suspicion during the COVID-19 pandemic, as the companies have been invited join national-scale programs, including the multitrillion rupiah preemployment card program, without public oversight or transparency, experts have said.

Recently, Andi Taufan Garuda Putra, a member of President Joko “Jokowi” Widodo’s expert staff, was criticized for sending out a letter on Cabinet Secretariat stationary asking district heads across Indonesia to support a COVID-19 relief program led by his fintech start-up, Amartha.

He sent the letter on April 11 without acknowledgement of the home minister, who supervises regional leaders, prompting the public to question the government’s impartiality. Andi has since revoked the letter and issued an apology, saying that his intention was to do something good as quickly as possible.

“There is clearly a conflict of interest that could lead to abuse of authority,” said Indonesian Forum for Budget Transparency (Fitra) secretary-general Misbah Hasan in a text message to The Jakarta Post on Tuesday.

“CEOs should step down prior to working in the government to be neutral. But I think the government was wrong in the way it recruited these CEOs because these appointments could hinder their creativity in improving their start-ups,” Misbah said.

There have been other cases like Andi’s. Adamas Belva Devara, another presidential expert staff member and the CEO of education start-up Ruangguru, was caught up in controversy as his company was appointed by the government to be one of several start-ups responsible for training workers in the preemployment card program.

On Wednesday, he sought to justify the situation on his personal Twitter account following complaints from netizens. He said he had asked State Palace officials if there was a conflict of interest even though he was not involved in the program’s partner selection process. He said he was ready to step down from the position but that the decision “should be discussed with the palace”.

The program, which aims to retrain and improve the skills of laid-off workers, has been given Rp 20 trillion (US$1.2 billion) from the state budget to cover about 5.6 million participants. Each participant will receive Rp 3.55 million in money and services: Rp 1 million for training costs, a stipend of Rp 2.4 million for four months of daily expenses and Rp 150,000 for job survey fees.

If the program procured goods and services through an appointment, Misbah said, it would violate Presidential Regulation (Perpres) No. 16 /2018 on government procurement, which states that procurement valued at Rp 200 million and above should be done through a tender.

“Even during the pandemic, the procurement and bidding must be transparent, accountable and open for all eligible providers through the Electronic Goods and Services Procurement [LPSE] system,” he said.

He went on to say that since the program had been rolled out, the National Public Procurement Agency (LKPP), the Government Internal Supervisory Agency (APIP) and the Supreme Audit Agency (BPK) would have to audit the procurement process, including the start-ups involved in the program.

Ruangguru CEO Iman Usman addressed the issue on his Twitter account @imanusman on Tuesday. He said procurement for the preemployment card was more like a social aid program, such as the Indonesia Smart Card (KIP) in which aid recipients could use the money they received to buy books, for instance, in partnering bookstores that “have fulfilled certain requirements”.

“The preemployment card is similar. People can choose courses from the eight digital platforms that have qualified,” he said in one of the tweets without specifying the qualifications.

Other than Ruangguru’s Skill Academy, education start-ups MauBelajarApa, Pijar, Pintaria and e-commerce firm Tokopedia-backed Tokopedia Pintar, among other start-ups, are also engaged in the program. Meanwhile, e-wallet GoPay, OVO and state-owned companies-backed LinkAja will channel the funds to the participants’ digital wallet.

Corporate affairs chief Nila Marita of Gojek, which will be involved in the preemployment card program through its e-wallet GoPay, told the Post that the start-up had been “officially appointed by the government” to be a payment partner in the program.

Tokopedia also stated in a press release on March 23 that it had been “appointed as an official digital platform by the Office of the Coordinating Economic Minister to launch the pre-employment card features”.

Institute for Development of Economics and Finance (Indef) economist Bhima Yudhistira said the government could use free and existing facilities, such as university websites, to offer online lessons for the preemployment program, instead of spending money on start-up platforms.

“Some start-ups are cozying up to the government to keep getting projects and sustain their businesses,” he told the Post over the phone on Tuesday. That practice, he added, would create a bad precedent for future start-ups as they might think that businesses needed the government as a patron to ensure viability, creating new generations of oligarchs.

Throughout March and April, other government bodies have partnered with start-ups in other sectors as well.

The Health Ministry, for example, signed a memorandum of understanding last month with 11 telemedicine start-ups, including Halodoc and Good Doctor Technology Indonesia.