The government’s plan to grant mining permits to mass organizations continues to be criticized. Considered breaking the law.

• The Indonesian Mining Expert Association (PERHAPPI) said the plan to give priority to mass organizations to manage mines in violation of the Mineral and Coal Law.
• The revision of Presidential Regulation Number 96 of 2021 to accommodate mining permits for mass organizations has not been completed.
• National Coordinator of Publish What You Pay Aryanto Nugroho urged the government to open the draft revision of the regulation to the public.
• “Sultry “on the news of the “clearance sale” of mining permits for mass organizations (ormas), the Indonesian Mining Expert Association (PERHAPPI) decided to determine the view. Rizal Kasli, who leads the institution, intends to send the results to President Joko Widodo as input.

Rizal hopes that the government will not take the wrong step. The reason is, the plan gives priority to mass organizations to manage the mine in violation of the provisions. In Law Number 3 of 2020 concerning Minerals and Coal, the supply of mining areas is prioritized to state-owned business entities as well as regional-owned business entities. If the license plate company is not interested, the offer will only be given to the private sector. “Everything has to go through an auction,” he said, yesterday.

The auction process is important not only to meet the rule of law, but also for transparency and the principle of justice. In addition, there is an element of revenue state in the procedure. The business entity must pay the cost of data and information compensation when participating in the auction of the mining business permit area. “If this is lost, it means that the country is harmed. It can enter the realm of criminal acts of corruption because this is detrimental to the state,” said Rizal.

Currently the government is designing a strategy to give priority to mass organizations. Presidential Regulation Number 96 of 2021 concerning the Implementation of Mineral and Coal Mining Business Activities is being revised to accommodate the plan. According to Tempo sources, in the revised draft of the rules there is Article 75A which regulates the granting of special mining business license areas in a priority for business entities owned by mass organizations.

The informan told that the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan opposed the idea. In a meeting at the State Palace, Jakarta, on March 13, Luhut expressed his refusal to argue fiercely with the Minister of Investment Bahlil Lahadalia, who encouraged alignment with mass organizations.

Luhut is open to the plan to hand over WIUPK to mass organizations. However, “The giving to private business entities must go through auction,” he said through a written answer to Tempo, Friday, April 5, 2024.

A week after the debate, Article 75A disappeared from the revised draft of PP Number 96 of 2021. In the document requesting a re-copy of the revision of the rules with the header of the Minister of State Secretary on March 26, 2024 obtained by Tempo, a new provision appears. Mass organizations that will get WIUPK are specifically referred to as religious mass organizations. In addition, the mining permit that will be given is only for coal commodities in the concession area of the former coal mining business agreement.

This revised design is still unfinished. According to the Head of the Public Relations, Law, and Cooperation Bureau of the Ministry of Law and Human Rights Hantor Situmorang, the harmonization stage in his team was completed on November 23, 2023. “The next stage is the request for determination by the President and the next invitation by the Minister of State,” he said when asked for confirmation, yesterday.

The Ministry of Energy and Mineral Resources stated that the process at the Ministry of State Secretariat has not been completed. “If it is published, we will announce the release in the first opportunity,” said the Head of the Communication Bureau, Public Information Service, and Cooperation of the Ministry of Energy and Mineral Resources Agus Cahyono Adi.

While it has not been completed, the National Coordinator of Publish What You Pay Aryanto Nugroho urged the government to open the draft revision of the regulation to the public. He highlighted the closed governance of mining even since Jokowi formed the Investment Acceleration Task Force, which became the forerunner of the plan to give WIUPK to this mass organization.

In May 2022, the President appointed Bahlil to lead the task force. He is in charge of tracing mining permits and unproductive gardens. The task force’s authority increased in January 2022. The team may revoke mining business licenses, business rights, and forest area concessions. Bahlil was recorded to revoke 1,749 mineral mining permits and 302 coal mining permits. Bahlil said that area will be offered to mass organizations.

According to Aryanto, so far there has never been any clarity about the revocation of the permit. ‘The one who was revoked was, because of what, not opened to the public,’ he said. Even though this information is important to determine the next step. ‘Do we have to offer that land again or reclaim it first, for example.’ The reason is, mining activities are currently considered massive.

Even if mining activities must be managed, Aryanto questions the government’s motive for prioritizing business entities owned by mass organizations. If you refer to the Minerba Law, private business entities do not have the opportunity to participate in the WIUPK auction. That is, if the mass organization has a business entity or legal entity, they can already contribute to the mining sector.

Director of the Center for Economic and Natural Resources Studies Ilham Rifki said that this policy actually opened the gap in buying and selling mining permits. “It is not impossible that the distribution of IUP for mass organizations ends in buying and selling or brokering IUP,” he said. The government’s decision also has the potential to worsen conditions in the midst of the revocation and recovery of mining permits that are not clear by the previous Investment Acceleration Task Force.

The Economist of the Institute for Development of Economics and Finance, Abra Talattov, highlighted the competence side of the corporate entity owned by the mass organization that will manage the mine. The auction process is important to ensure that the company has qualified capabilities. “It is useless if IUP is given, but they do not have competence. In fact, it will stall again like the IUP which was revoked yesterday,” he said. The government will fall again into the same hole of error.

Bahlil previously mentioned the WIUPK offer for this mass organization as an effort by the government to involve more people in the management of natural resources. He considered that there was no problem with allowing mass organizations, cooperatives, even small and medium enterprises to enter the mining industry as long as they meet the existing conditions. Regarding competence, he said this opportunity can be a learning place for them. “If you wait for experience, is that big entrepreneur already experienced before?” Bahlil said in his office, last March 18.

In an interview with Tempo magazine on March 1, 2024, Deputy Secretary General of the Board of Nahdlatul Ulama Rahmad Hidayat Pulungan said that NU had applied for a mining business license to the government to manage the former concession area owned by PT Kaltim Prima Coal in East Kalimantan. However, the application has not received government approval.

Source: Tempo