Aburizal could be forced to settle Lapindo mudflow

The Jakarta Post, Jakarta, Tuesday September 30 2014,


The House of Representatives on Monday unanimously passed into law a bill that allows president-elect Joko “Jokowi” Widodo to force chairman of the Bakrie Group, Aburizal Bakrie, to fulfill his Rp 781 billion (US$65 million) financial obligation to the victims of the Lapindo mudflow disaster in Sidoarjo, East Java, next year.

Aburizal, who is also Golkar Party chairman, has lost the privileges he has enjoyed between 2007 and 2014 courtesy of President Susilo Bambang Yudhoyono’s administration.

The President had allocated more than Rp 6 trillion to compensate villagers living in the vicinity of the so-called “affected area map”, which was legalized via a presidential decree in 2007.

Such generous financial protection for the Bakrie Group was among the reasons why Golkar helped the Yudhoyono government remain stable in the face of nationwide protests at the President’s generosity toward the conglomerate.

However, the 2014 state budget, which was passed during Monday’s plenary meeting, no longer mentions such spending. Instead, Article 16 (2) only stipulates that “the [central] government can give a grant to local governments for post-disaster rehabilitation and reconstruction.”

Indonesian Democratic Party of Struggle (PDI-P) lawmaker Rieke Diah Pitaloka applauded the absence of an article stipulating that the government take over the financial burden caused by disaster, which was allegedly caused by PT Lapindo Brantas, an oil and gas company affiliated with Golkar chairman Aburizal, during its drilling operations in 2006.

“Lawmakers and the government should have erased the article long ago. It doesn’t make sense if taxpayers take over responsibility [for paying] from the company that triggered the disaster in the first place,” she told The Jakarta Post.

Lalu Mara, deputy secretary general of Golkar and Aburizal’s close aide, declined to comment on the House’s decision.

“It’s better to contact Pak Andi Darussalam to seek a comment on the matter,” he said, referring to the vice president of Lapindo Minarak.

There have been several efforts to stop the mud eruption, including a relief well method and the insertion of concrete. However, none have been able to stop the flow of mud, which many geologists believe could last up to 30 years.

In 2007, the government also established the Sidoarjo Mudflow Mitigation Agency (BPLS) to handle and control the mud eruption, relocate infrastructure, recover infrastructure, and supervise Lapindo in handling compensation for villagers in the affected area.

Lapindo, via its subsidiary PT Minarak Lapindo Jaya, recently claimed it needed to pay another Rp 781 billion of the required Rp 3.8 trillion in compensation to more than 4,000 victims who used to live within the affected area.

Public Works Minister Djoko Kirmanto, who leads the BPLS advisory board, said last week that the agency had recommended the government use the 2015 budget to help pay the remaining compensation.

However, Finance Minister Chatib Basri reiterated over the weekend that according to a Constitutional Court ruling issued earlier this year, the government was obliged to force Lapindo to complete payment of compensation to victims of the mudflow disaster.

Another PDI-P lawmaker, Arif Budimanta, reminded Jokowi and his incoming administration to ensure that outgoing President Yudhoyono, who proposed next year’s state budget, did not spread funds for compensation among the budgets of certain ministries or other state institutions.

“We need to make sure that those who caused it [the mud disaster] take responsibility for what they have done,” Arif said.



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