JAKARTA. Publish What You Pay Indonesia (PWYP), which is a Civil Society Coalition for Transparency and Accountability of Extractive Resources Governance, consisting of 38 Civil Society Organizations (CSOs) spread across Indonesia, revealed that 27 of the 108 mineral and coal (minerba) companies have not submitted company payment data to complete the 2012-2013 EITI (Extractive Industry Transparency Initiative) report.
On the other hand, there are 11 out of 174 companies in the oil and gas sector that have not completed the EITI report. A number of mining and oil and gas companies that have not reported EITI have the potential to set a bad precedent for transparency and governance of the extractive industries in Indonesia.
Maryati Abdullah, Coordinator of PWYP Indonesia, regretted the attitude of the company in not sending the EITI report amidst the government’s efforts to restore the suspended status of EITI Indonesia’s membership.
This suspended status has been in effect since 26 February 2015 because Indonesia was late in issuing the EITI report for the 2012-2013 period. “This shows the weak commitment and seriousness of these companies to be transparent and at the same time does not support the Jokowi administration’s efforts to improve transparency and accountability for the extractive industry in Indonesia,” said Maryati in a written statement, Tuesday (29/9).
The mineral and coal companies that have not reported include 1 company holding a Contract of Work (KK), 9 mineral mining business permits (IUP), 2 Coal Mining Exploitation Work Agreements (PKP2B) and 15 coal IUPs. Yenni Soetjipto, Civil Society Representative in the EITI Indonesia Implementation Team, urged the government to take a firm stance on companies that are reluctant to report EITI.
“The reluctance of companies to report EITI should be a tool for evaluating the government on the existence of these companies. Moreover, the implementation of EITI Indonesia is one of the actions mandated in Presidential Instruction (Inpres) Number 7 of 2015 concerning Action to Prevent and Eradicate Corruption, so that the reluctance of companies to report EITI can be interpreted as resistance to anti-corruption movement efforts, “added the Secretary General of FITRA (Indonesian Forum for Transparency. Budget).
Yenni added that the 38 companies that have not reported are expected to send their reports by October 5 at the latest. “Later, we will consider the implementation team forum the consequences for those who do not report. If possible, we hope that there will be sanctions for not reporting, such as being announced to the mass media and the report being followed up to the relevant ministers and regional governments, “said Yenni.
EITI is an international standard in reporting state revenues from extractive industries, whose process involves multi-stakeholders consisting of government, business and civil society and has been implemented in 46 countries. The implementation of EITI in Indonesia is based on Presidential Regulation No. 26 of 2010 concerning Transparency of State Revenue and Regional Revenue Obtained from Extractive Industries.
The selection of extractive companies covered in the EITI report is made based on the total amount contributed by these companies to the total state revenue originating from the extractive sector. For the oil and gas sector, all companies that have produced are included in the scope of this report.
As for the mineral and coal sector, the companies that are included in this report are a combination of companies that have contributed 80% of corporate income tax revenue from the mineral and coal sector and paid royalties to the state in the amount of more than IDR 25 billion (where the companies this contributed 81.67% and 84.65% to state revenue from royalties in 2012 and 2013).
On the other hand, the process of compiling the 2012-2013 EITI report, which is currently still being prepared by the Independent Administrator (AI), needs to be closely guarded. Especially in meeting the 2013 EITI standard as a reference for preparing the EITI report.
The 2013 EITI Standard requires the addition of contextual information in the EITI report so that it is more comprehensive and useful for the public in understanding the extractive industry in Indonesia and the reconciliation results provided.