Indonesian Vice President Ready to Face Bailout Inquiry

Vice President Boediono on Friday announced his readiness to be questioned by the House of Representatives over the controversial Rp 6.7 trillion ($717 million) bailout of PT Bank Century, which was disbursed last year while he was central bank governor. “I believe this is the right and the role of the House to decide what it needs to know, and summon [officials] of the government. We are ready,” Boediono said at his offices. The statement came a day after House Speaker Marzuki Alie formally accepted a motion from 139 lawmakers to launch intensive investigations into the scandal. Members from eight of the nine parties in the House were represented in the petition. President Susilo Bambang Yudhoyono’s Democratic Party was the exception. Eighty of the motion’s signatories were from the Indonesian Democratic Party of Struggle (PDI-P). Boediono, who recommended the bailout when he was head of Bank Indonesia, said he wanted to help clear up the case. “The motion aims to provide new insight. We want everything to be clear,” Boediono said. “The vice president is also a citizen. As a citizen, I am ready to be questioned.” The government’s decision to bail out the ailing bank at the time was an effort to overcome an emergency situation. There was an extraordinary problem, including a liquidity problem. So, if any criminal act had been committed in the bail-out process, it should be investigated, no matter who was involved, he said. The Century bailout spurred public outrage because the government had injected Rp 6.7 trillion through the Deposit Insurance Agency (LPS) last November to save the privately owned bank when the House had only approved Rp 1.3 trillion. The government has argued that the bank’s failure would have had a domino effect on the financial sector amid the global economic downturn. Boediono argued that in time of crisis, “Saving [a bank] should come first. If there is any fraud, then it should be followed up legally later.” The House is scheduled to deliberate next week on whether to proceed with investigations of the Century rescue. Democratic Party lawmaker Sutan Bhatoegana said such a probe would “not be effective,” and dismissed any possible significant outcome from the scheduled deliberations. “Judging from the previous motion to probe the mafia in the gas industry, I believe the motion would not be effective. [The earlier] motion only resulted in a recommendation to revise the oil and gas law,” he said. The Democrats were not worried by the motion as it was only a move by lawmakers in their capacity as individuals, not party members, he said. Of a similar opinion was Taufik Kiemas, the People’s Consultative Assembly (MPR) chairman who also heads the PDI-P advisory committee. He said his party did not initiate the motion even though the vast majority of its supporters were PDI-P lawmakers. Taufik, the husband of PDI-P chairwoman and former President Megawati Sukarnoputri, claimed that the party had chosen not to serve as the opposition in this case. “Golkar initiated the motion, PDI-P is just a follower. I think PDI-P has chosen its stance to balance the government. It’s impossible that we act as opposition. We are dynamic critics,” said Taufik, who became chairman of the MPR with full backing from the Democrats. Gayus Lumbuun, a PDI-P lawmaker, said Taufik was going against strict instructions from Megawati to all PDI-P followers to support the motion. “Ibu Megawati has stated that the PDI-P must become the main actor in unraveling the case,” he said at the House on Friday. Last month, lawmakers disclosed that the Supreme Audit Agency’s preliminary audit — marked “state secret” — had uncovered indications” of criminal activity.

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