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LAND ACQUISITION: Bridging Funds Refunded from April

Date :

01 Mar 2017

Category :

Other Infrastructure Policy

Source :

Bisnis Indonesia

File :

Bisnis Indonesia, 8 March, 2017, Page 7, Section: Infrastruktur 
By Deandra Syarizka
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JAKARTA - The government has confirmed that the process of first-phase reimbursement of the land acquisition bridging funds for toll road projects can begin in early April 2017, after getting verification from the Financial and Development Supervisory Agency.

Head of the Toll Road Regulatory Agency (BPJT), Herry Trisaputra Zuna, said that the Ministry of Public Works and Housing (PUPR) will arrange the signing of memorandums of understanding between the State Assets Management Institute (LMAN) and toll road business entities (BUJTs) for this purpose.

"Before the payment, we arrange MoUs first between LMAN, BPJT, and BUJTs; the plan is to do this before 15 March," he said when contacted by Bisnis, Monday (7 March).

Until the end of 2016, the total amount of bridging funds that have been collected from the 32 toll road business entities has reached Rp 32.59 trillion.

Based on the Ministry of Finance Regulation No. 21/PMK 06/2017 on Procedures for Land Acquisition Funding for National Strategic Projects and Management of Assets Derived from Land Acquisition by the State Assets Management Institute, the memorandum of understanding will cover a number of things, among them the basis of agreement, agreed nominal amount, and agreed cost of funds, as well as a statement that the head of LMAN will make a payment in the amount stated in the agreement.

Herry added that the refund process may be divided into several phases.

The first one is repayment for bridging funds expended until December 2016. The second phase will refund bridging funds spent from the beginning of this year until March.

Head of Public Services Board of BPJT, Arief Haryono, explained that, until 31 December 2016, the warrants for payment (SPP) recorded in BPJT already reached Rp 14.22 trillion.

Of that amount, actual repayment of the bridging funds expended by business entities for public purposes reached Rp 13.09 trillion. Meanwhile, the funds derived from the difference between the SPP amount and actual repayment amount as of December is still being used to pay affected residents until March this year, hence this is included in the second phase repayment period. Thus, he said, the first phase repayment of bridging funds proposed by LMAN reached Rp 13.09 trillion. The amount includes the cost of funds, or interest amounting to Rp 350 billion.

"So, on 1 April, it will be payment of the principals first. The cost of funds will follow after that. What we have proposed is Rp 13.09 trillion. We want to immediately refund all, but it still depends on the verification of BPK. It could be that [the amount paid] is less than that," he said.

Arief added that, for the second-phase, his institution has requested repayment of bridging funds amounting to Rp 2.40 trillion, which consist of actual utilisation of land bridging funds from January to March this year and an interest amount of around Rp 500 billion.

According to him, BPKP officials are currently in the process auditing the land payment documents in each region.

He expressed hope that the verification process can be completed on 23 March, for approval by the central office of BPK and subsequently [the verified bridging funds get] refunded by LMAN in early April.

He affirmed that the reimbursement of the bridging funds does not yet include two toll road segments, namely Pasuruan - Probolinggo and Krian - Legundi - Bunder - Manyar. This is because the Pasuruan - Probolinggo segment has not been included in the list of national strategic projects, while the Krian - Legundi - Bunder - Manyar segment has become a national strategic project. However, this segment is not yet on the list of national strategic projects whose land acquisition is to be financed by LMAN.

Director of LMAN, Rahayu Puspasari, said that the refund of bridging funds to toll road business entities will use the 2016 LMAN budget of Rp16 trillion. His office is finalising the contents of a memorandum of understanding to be signed and is seeking the right time to do the signing.

"As soon as the PMK [regulation of Finance Minister] has been issued, BPKP will verify within approximately 20 working days. The results from this review will later be submitted to the Ministry of PUPR; then PUPR will suggest the reimbursement of the bridging funds to LMAN. The funds are ready. Every time presented, we will finish the verification directly and we will pay straight away," he said.

He added that Faith only procure land for 50 national strategic projects, with the list being determined by the Committee for Acceleration of Priority Infrastructure Provision (KPPIP).

Therefore, he said, the refund of the bridging funds for toll road land acquisition for projects outside the list of national strategic projects, such as the Pasuruan - Probolinggo toll road segment, will only be made after the toll roads have been set to become national strategic projects.

Actual Bridging Funds for Toll Road Land Acquisition

Total of Bridging Funds Rp 32.59 trillion  
Jabodetabek  Rp 17.73 trillion 39%
Trans Java  Rp 8.76 trillion 27%
Sumatera & Others  Rp 7.52 trillion 23%
Non-Trans Java  Rp 3.58 trillion 11%

Source: Ministry of PUPR, December 2016