GOVT TO AUDIT PLN'S REQUEST FOR ADDITIONAL SUBSIDY FUNDS

Jakarta, June 17 (ANTARA) - The government will audit state electricity company PLN's plan to propose Rp2 trillion-Rp3 trillion in additional subsidy funds for investment in new power connections before submitting it to the House of Representatives (DPR), an official said.

Director General for Electricity and Energy Utilization Jacobus Purwono said here on Wednesday PLN had not yet officially proposed the additional subsidy to the government .

"But we will carry out an audit on it first to know the PLN's calculations, the amount really needed and the mechanism of the funds' allocation," Purwono said before attending a working meeting with the House's Working Committee on electricity.

He said the option that could be taken in order to meet PLN's request was to use existing unspent subsidy funds.

Previously, PLN President Director Fahmi Mochtar had proposed additional subsidy in an effort to overcome a shortage of funds for the installation of new power connections.

He said that PLN only had Rp1 trillion in funds for the installations of new power connections, while the need reached Rp3 trillion-Rp3.5 trillion so that additional subsidy was needed.

Purwono said earlier that it was quite possible for the government to provide PLN with extra funding this fiscal year for the installation of new power connections.

"But the additional subsidy will be disbursed following an audit by the Supreme Audit Board (BPK)", he said.

Purwono added that officially PLN had yet to submit the figures on the additional subsidy, but in an informal way, PLN had submitted a proposal for Rp2 trillion in additional funds.

PLN was recently reported to have raised the cost of the new connections without the government's approval which is contradictory to the Law.

Following objections from many circles, PLN canceled the increase, saying that in meeting applications for new power connections, it had only received Rp1 trillion from the government while it actually needed Rp3 trillion.