Pramono Anung: Gov’t Encourages BUMN to Establish Holding Companies

Cabinet Secretary Pramono Anung delivers press statement after a limited meeting, at the Presidential Office, Jakarta (29/2)

Cabinet Secretary Pramono Anung delivered press statement to the reporters after a limited meeting, at the Presidential Office, Jakarta, on Monday (29/2) afternoon. Pramono said that President Joko “Jokowi” Widodo has received inputs from the Minister of State-owned Enterprises (BUMN) as well as other ministries to strengthen BUMN holding companies.

Pramono also said that it is to prevent BUMN from any political party infiltration. “The President gave direction to carefully carry out the holding companies in order to make a more compact and agile BUMN that are not burdened with non-professionals details,” Mas Pram, nickname of Pramono Anung said.

According to Pramono, there are several BUMN holding companies which were discussed in the meeting, among others, infrastucture, banking, mining, new energy, and energy security. The details will be delivered by related ministries once the process is finished.

In long term, BUMN is expected to be our power, like Temasek (Singapore’s BUMN) and Malaysia’s BUMN. “With synergy, the process of establishing holding companies will make BUMN stronger,” Pramono added.

Pramono also expected the process in BUMN holding companies to be natural. “There are indeed changes of Government Regulations in the process, as the derivative of the Law,” Pramono said.

After establishing holding companies, Pramono said BUMN is expected to no longer receive funds from the State Budget (APBN). “BUMN will be independent and stronger. They will contribute to the country in income tax,” Pramono explained.

Construction of Ministries’/Institutions’ Facilities

Meanwhile, regarding the construction of infrastructures and facilities of ministries/institutions, Pramono said that the President decided to carry on the moratorium. “Not every construction will be approved. The approval is only issued for educational facilities,” Pramono added.

According to Pramono, new land purchasing for ministries/institutions will not be approved as well. “They were instructed to use public land,” Pramono said.

The Government realized that we must increase state revenues in 2016 to add the State’s income. Therefore, regional and central governments are not allowed to add facilities including land purchasing. “Only facilities relating with education, terrorism, and drugs that are allowed. And it must get approval from the President. Beforehand, the President asked Minister of Finance as well as Development and Finance Surveillance Agency (BPKP) to conduct detailed studies and not to easily grant approval,” Pramono Anung concluded. (DID/SM/EN) (RAS/MMB/YM/Naster)