PLN wants govt's helps to revive the company
Friday, March 23 2001 - 04:30 AM WIB
State electricity company PT Perusahaan Listrik Negara (PLN) has asked the government to allocate the not-yet-disbursed electricity subsidy for 1999/2000 budget year of Rp 3.5 trillion for electricity subsidy for year 2000.
In a limited economic ministers meeting at the vice presidential palace on Thursday (March 22), PLN president Eddie Widiono also asked the government to postpone the payment of PLN's income tax resulting from the revaluation of the company's capital and assets.
Eddie noted that subsidy funds could not be disbursed because of "the wrong disbursing method" in which the government would disburse the fund only when PLN booked negative cash flows.
"In fact, in terns of income and loss, we suffered a huge loss. Therefore, we asked the government to allocate the subsidy funds for our 2000 needs," Eddie said.
PLN also demanded the government to give some leeway in the form of interest discount of its massive debt to the government.
Finally, PLN demanded the government to cut natural gas prices for PLN's power generations using gas as its energy source, to make the electricity produced by those power generations a lot cheaper.
Coordinating Minister for Economic Affairs Rizal Ramli said that the government basically could understand all PLN's demands, but the government would discuss those demands further in technical meetings with economic ministers in the Cabinet, especially with the finance minister.
Rizal said that the meeting at the vice presidential palace had not yet decided on the proposal from PLN about the use of the 1999/2000 subsidy fund, and added that he would discuss the matter with the finance minister.
About PLN's capital and assets revaluation, Rizal said that PLN's capital currently stood at minus Rp 9 trillion and assets at positive Rp 52 trillion. After revaluation, PLN's capital would be boosted to positive Rp 158 trillion, and assets to Rp 202 trillion. However, PLN will be burdened with massive income tax from the difference resulted from assets revaluation.
"PLN has asked the government that the payment of the income tax could be postponed, and we will suggest the finance minister to accept the proposal," Rizal said.
Rizal added that he had promised PLN that the government would give interest discount of PLN's massive debt to the government. "Besides, the government can abolish various penalties imposed on PLN."
Nevertheless, Rizal said that the government had asked PLN to sell non-core assets, such as houses built for its employees, to help improve its cash flow. Those houses could be sold to PLN employees.
Rizal, however, could not give a positive response to PLN's demand for a cut in natural gas prices for PLN power generations, noting that it would affect the government's income from the oil and gas sector. (*)