Are the Food Security Fund and Economic Stabilisation Fund fattening select businesses or the Maubere people?

Subject: Rice Contracts
Date: Mon, 17 Nov 2008 13:22:01 +1100

POLICITAL DECLARATION
FRETILIN BENCH

Excellency Mr. President of National Parliament
To all Distinguished Parliamentarians,
To all the Maubere people,

Today the FRETILIN bench wants to present in Parliament (cultural house of the Maubere people) the fundamental question of food security in connection with food to sustain people's lives and budget that has been spent and that is to be spent in 2008.

The Food Security Fund was created as a mechanism that the FRETILIN government created with the intention to not only buy rice but to provide support to farmers to increase their capacities and to ordinary people to gain protection through having sufficient food.

After more than a year, the de facto AMP government has spent millions of dollars on the budget item Food Security Fund with money that has been moved from the Economic Stabilisation Fund with the intention to assist people who have difficulty obtaining food – but perhaps the intention was to fatten up as well some of their colleagues and friends, which included the quick expenditure of the budget that was approved by Parliament in July 2008, in particular the Economic Stablisation Fund.

The food shortage problem, especially rice, has become a big problem in our nation since the de facto AMP government began governing this country – because the question of food shortage has occurred in many districts in Timor-Leste which has made the de facto AMP government buy and sell rice to their own Maubere people.

Mr. President and all parliamentarians,

The question of buying and selling rice to the people has become the principal reason from the de facto AMP government to ask the representatives of the people who sit in parliament to approve a very big budget in the 2008 Ratified Budget.

From the very beginning of the year, the de facto AMP government sold rice to the Maubere people with the very high official price of $17 each sack but the price rose to as high as $40 a sack when sold in the market in some districts. Despite the government using the reason of intervention to normalize the price of rice in the market – this normailsation has instead become an instrument of the government to raise the price of rice which was sold at a price of $12 to $15 in the tome of the FRETILIN government. The FRETILIN bench is concerned with this policy of intervention from the government through the Food Security Fund and the Economic Stabilisation Fund.

Just after the de facto AMP government came into place – the FRETILIN bench registered that the previous FRETILIN government had total of 17,582.57 tonnes of rice in storage. The previous government bought this rice at a price of not more than $500USD. The FRETILIN bench is very concerned why rice is being sold at a price of $17 a sack when it was bought for $500USD?

In the General Budget for the Transitional Period 2007 – the government requested total amount of $6,880,000USD for the Food Security Fund and this item was not spent, as reported in the 31 March 2008 final report of Execution of the Transitional Budget 2007, which was carried over to the total amount of $5,799,986USD.

But the food security item was increased in the 2008 General Budget to the amount of $5,352,000USD before the budget was ratified. The budget from the Food Security Fund is always increasing and then the parliament approved again the budget item of $11,867,000 but in reality the de facto AMP government has spent, since the budget of the transitional period, a total of $24,546,986USD.

The FRETILIN bench wants to know the total amount of money spent on food security, how many tonnes were bought and how many tonnes were sold? What was the contract process of the de facto AMP government and how did they carry it out? Was the Tender Regime applied or not? And why is the price of government rice so high?

We are concerned that perhaps the government contracts for buying rice were awarded by raising hands as occurred in the contract to Três Amigos, the company of which the director was formerly the director of finance and administration in the Office of the President when the current de facto Prime Minister was President of the Republic.

Parliamentarians,
The FRETILIN bench sees that the policy of buying rice from the AMP government has become an instrument to spend the people's money quickly and without any control. In the month of October just after the approval of the 2008 ratified budget the FRETILIN bench registered that the government has already made contracts to buy rice with 7 companies, with money taken out of the Economic Stabilisation Fund. The companies that have been awarded contracts to buy rice are as follows:

1. Sebajaya; 1,615,000
2. Atramor; 1,848,640
3. Belun Feto; 3,842,500
4. Três Amigos; 3,843,500
5. Star King; 3,842,000
6. Maubara Fitun Naroman; 3,843,000
7. United Food; 3,842,500

The total amount of money spent from the Economic Stabilisation Fund to the companies listed totals 22,676,140 USD.

The FRETILIN bench has also noted that through the contracts that the de facto AMP government has awarded to the above named companies the government has also allocated money from the Economic Stabilisation Fund to a total of $57,371,750UDSD to buy rice, which brings the total amount of $80,047,890USD was spent to buy rice utlilising money from the Fund.

Parliamentarians,

The de facto AMP government, which has only recently come into power, has spent total of $104,594,876USD to buy rice. The amount of money that the government is spending to buy rice from the utilizing money from the Food Security Fund and Economic Stabilisation Fund deeply concerns the FRETILIN bench.

The fundamental questions that the representatives of the Uma Fukun (Parliament) have are as follows:

1. Was the people's money that was spent was to buy rice provided to those who really needed it?

2. The policy of the Food Security Fund and the Economic Stabilisation Fund is for the benefit of the company Três Amigos and the Prime Minister or for the poor? The FRETILIN bench notes that the director of Três Amigos Mr. Germano da Silva, previously the director of Administration and Finance in the Office of the President, received a contract worth $17,842,500USD

3. The expenditures were made applying the Juridical Regime for Tender or not?

4. Finally, FRETILIN bench would like to ask for copies of all the contracts that the de facto AMP government has made with companies to buy rice and how much of the rice has been sold to Maubere people and how much is to be sold?

Mr. President of National Parliament,

Distinguished parliamentarians, all Maubere people,

In conclusion, the FRETILIN bench's political declaration sees that the policy of the AMP government is to fatten their business friends rather than their people who have to buy rice at a high price. The FRETILIN bench sitting in today's plenary will hold a parliamentary enquiry to the de facto AMP government according to the RDTL Constitution, articles 95, no. 3 and 101, no. 2 and articles 14h, 139 and 140 of the National Parliament Regiment, to discuss the extremely relevant question of national interests and material discussion of the subject of Food Security Fund and Economic Stabilisation Fund to buy rice for the Maubere people.

Dili, 11 November 2008

In the name of the FRETILIN bench

Parliamentarian Arsénio Bano

----------------------
Note Rice Contract after 11 November 2008.


1. Serbajaya; 1,615,000
2. Atramor; 1,848,640
3. Belun Feto 3,842,500
4. Tres,AMIGOS; 3,843,500
5. Star King; 3,843,000
6. Maubara Fitun Naroman; 3,843,000
7. United Food; 3,842,500
8. Jubilex; 3,516,000
9. Monteveado; 3,516,000
10. Prima Food; 3,516,000
11. Ran Aitana; 3,516,000
12. Suai Indah; 3,516,000
13. Hercio International; 3,516,000
14. Veteran General; 3,516,000
15. Olifante; 3,516,000
16. Taci 3,516,000
17. Lunarsol; 3,516,000

There for, The total amount of money spent from the Economic Stabilisation Fund to the companies listed totals 57, 838, 3900 USD.

The FRETILIN bench has also noted that through the contracts that the de facto AMP government has awarded to the above named companies the government has also allocated money from the Economic Stabilisation Fund to a total of $22,209,390 to buy rice, which brings the total amount of $80,047,890USD was spent to buy rice utlilising money from the Fund.

Timor Leste budget crisis: AMP Government appears determined to breach court ruling

FRENTE REVOLUCIONÁRIA DO TIMOR-LESTE INDEPENDENTE

F R E T I L I N


MEDIA RELEASE
Dili, 16 November 2008


Timor Leste's de facto government appears determined to try to thwart the Court of Appeal's decision against its failed 2009 budget, FRETILIN's parliamentary leader Aniceto Guterres warned today.

The collective made up of three Court of Appeal judges on November 13 unanimously ruled against the budget's two key pillars – the US$240 million so-called "Economic Stabilization Fund" (an unconstitutional slush fund) and the illegal transfer of US$290.7 million from the Petroleum Fund to the budget.

Speaking in Dili, Aniceto Guterres said: "The court's decision was, and I paraphrase its own words, to:

a) Declare the unconstitutionality, with the force of general compliance, the following provision:

The provision in line o), of no. 3 of article 1 of law No. 12/2008 of 5 August, whereby the amount of 240 million US dollars is allocated to the Economic Stabilization Fund.

b) Declare the illegality, with the force of general compliance, the following provision:

The provision 3 of article 1 of Law No. 12/2008 of 5 August, whereby it stipulates the amount of transfers from the Petroleum Fund for 2008, in an amount in excess of $396,100,000 (three hundred and ninety six million one hundred thousand) US dollars.

"This is clear for all to read. However in a media release dated 14 November 2008, the spokesperson for the AMP de facto government contradicted the court decision, declaring that 'the Economic Stabilisation Fund is in accordance with the Constitution of the Republic of Timor-Leste and is compliant with the law'.

"This is simply untrue and indicates their intent to thwart the court's ruling which severely embarrasses the de facto government," Guterres said.

"The AMP spokesperson's media release also said: 'While the decision is not published in the Official Gazette, the Government does not have official knowledge of the decision made by the Court of Appeal', adding that the court decision 'limits the "unconstitutionality" and the "illegality" to the period after the publication of the judgement in the Official Gazette. Which means that, whatever the amount that has already been withdrawn from the Petroleum Fund thus far, it would never be unconstitutional nor illegal.'

"This interpretation is self-serving and false," Guterres said.

"On page 51 of its decision the court said:

'In the face of the previously stated, it is decided to limit the effects of this declaration of unconstitutionality and illegality, as a means of safeguarding the acts of a financial and budgetary nature, undertaken up to the date of the communication of this decision to the National Parliament.'


"The court has declared these budget measures illegal and unconstitutional while limiting the effect of its declaration, because of the impact it would have on the state. These acts have not been forgiven or sanctioned, the government has merely been given a reprieve from having to reinstate or pay restitution to the state.

"This is an act of good faith by the court to maintain stability in the financial system and society. It does not diminish the fact that they were illegal and unconstitutional acts for which this government and the majority in the parliament have to account for.

"The statement by the spokesperson for the government shows they intend to find any way to circumvent and thwart the court's ruling against them. FRETILIN will take further legal action to seek legal remedies for any contravention of the court's decision.

"We warn the de facto government against rushing to pay out amounts of money on the ludicrous basis that they are not formally notified of the court's decision until the Official Gazette publishes the decision. Given that the government controls the Official Gazette (Jornal da Republica) and the timing of its publication, this would be the ultimate in cynicism and bad faith.

'We call on the government, especially the Prime Minister and his Minister of Finance to come to the Parliament and explain to the people's representatives what the exact budget situation is. We need to know exactly how much cash has been paid to the 13th of November 2008, what amount is pending as partial remaining payments and what agreements the government is not at this stage obligated to pay, and therefore according to the court decision should not be paid from the amount in excess of US$396.1 million drawn from the Petroleum Fund in breach of the constitution.


"It is important that the administration does this, so that we are all certain that no more illegal or unconstitutional acts are perpetrated."

"We call on the government to exercise good faith and stop the slide into an institutional and potentially constitutional crisis," Guterres concluded.

For further information contact Jose Teixeira on +670 728 7080