Private Public Consultations

Although many people are discussing Public-Private Partnerships (PPPs) as a new model for developing infrastructure in Timor-Leste, Private Public Consultations (PPCs) have been with us for a long time. One example is the "Public Consultation" announced by the National Petroleum Authority (ANP) and Ministry of Petroleum and Mineral Resources on this banner, which has been displayed across from the Foreign Ministry for about a week.

The meetings will discuss draft Technical Regulations for oil and gas operations off Timor-Leste's south coast, in the Exclusive Area not shared with Australia. The detailed rules can protect (or endanger) workers, revenues and the environment. These regulations, hundreds of pages long,   are critically important in balancing the cost-cutting, profit-seeking incentives of the companies against the human, financial and ecological responsibility of Timor-Leste's government to safeguard against such dangers.  When a similar consultation was held in 2008 on Technical Regulations for the Joint Development Area, La'o Hamutuk identified many areas which needed improvement, and we would like to be able to help this time as well. Since then, offshore oil disasters like Deepwater Horizon and Montara have been sharp reminders of the need for effective regulation.

After we saw ANP's banner, we asked them for the draft regulations, so that we could prepare for the consultation. A day later, they declined to share the documents, but did send us an invitation (left) and agenda (right). We are posting them to encourage others to join the Dili workshop, which will be at Delta Nova on Wednesday, 14 May from 08:30 - 16:00.  Four hours of presentations will be followed by 45 minutes of questions and answers.

La'o Hamutuk does not have experts on staff who can thoroughly analyze complex technical documents; we rely on experienced international volunteers.  The ANP also required outside help, and they contracted Gaffney, Cline & Associates who presented a draft in 2011, which ANP has been studying for nearly two years.

After such a long process, ANP knows that it takes time to understand these documents and give useful input. The late notice for the consultation, with no substantive information, raises doubts about its purpose. So we asked:

"Wouldn't the consultation be more effective if people had a chance to read the drafts before the workshop, and perhaps to discuss them with others to get wider and wiser input?  Or is this really a socialization, where ANP will explain what they have already decided to do, rather than expecting to modify the drafts based on people's suggestions during the consultation process?"

In response, ANP promised that "the ANP will continue receive public opinion/feedback or submissions after the workshop."  We hope that they will modify the regulations to incorporate the suggestions they receive, and that this PPC is more than pro-forma.

Update, 13 June: A week after we wrote this blog, ANP posted the draft regulations and other materials at http://www.anp-tl.org/webs/anptlweb.nsf/vwAll/PUBLIC%20CONSULTATION. They "highly encourage" and "greatly appreciate" public participation in this consultation, and recently extended the time for written submissions from 14 to 30 June. To make a submission or to ask for more information, contact anp.konsultasaunpubliku@anp-tl.org.

Update 1 July: La'o Hamutuk has made a web page about this consultation process, including the submission we gave to ANP yesterday. The main points of our submission include:

• Timor-Leste’s interests are broader than simply maximizing production of oil and gas, but encompass state revenues, environment, sustainable development, and minimizing risks of injury, damage or corruption.
• Many provisions on environment, health and safety should be improved, including those discussing management of discarded materials, legal frameworks, minimizing risks, banning flaring, defining “best practice” and “reasonably practical,” health and safety committees and audits, sanctions, and protecting against companies’ negligence or malfeasance.
• Before onshore exploration begins, local communities need more consultation and protection.
• Timor-Leste should receive more money from extracting our oil and gas, and not be so generous to the companies.
• All revenues – taxes, royalties, fees, penalties – must be deposited into the Petroleum Fund as required by the Petroleum Fund Law.
• Transparency is generally ignored and sometimes prohibited by these draft regulations and contracts, and needs more attention, requirement and protection.
• Even though local content is unlikely to be a significant element in building Timor-Leste’s non-oil economy, it needs better definition and clearer requirements.
• Obligatory monetary “contributions” from companies are inappropriate, as they violate budgetary and democratic processes.

Environmental licensing – who needs it?

Liga ba Lisensamentu Ambientál – hodi proteje ita hotu, verzaun Tetum artigu ne'e atualiza iha Novembru 2018

Protecting Timor-Leste's fragile environment is essential for national development and improving the quality of people’s lives. It allows us to farm, eat, drink, fish and breathe. If we allow it to be damaged, we get famine, flooding, pollution, toxic waste and disease. This is recognized in Article 61 of Timor-Leste’s Constitution: “Everyone has the right to a humane, healthy, and ecologically balanced environment and the duty to protect it and improve it for the benefit of the future generations. … The State should promote actions aimed at protecting the environment and safeguarding the sustainable development of the economy.”

As the 2011-2030 Strategic Development Plan explains, “The people of Timor-Leste have a strong relationship with the natural environment. For generations, our ancestors depended on the environment for food, clothing, building materials and everything else essential for life. We lived in harmony with the environment, using it sustainably to support our families.”

To achieve these goals, and to protect Timor-Leste’s unique geology and ecosystems, projects with significant environmental risk need to be evaluated and licensed before they are built, including both assessing possible environmental impacts and planning how to manage them, during both construction and operational phases. Since 2011, Timor-Leste has had our own environmental licensing law, and before that the Indonesian AMDAL law applied here. Nevertheless, very little is known about the licensing processes for environmentally risky projects which were started or built in the last three years.  Many never even bothered to apply.

RDTL Decree-Law no. 5/2011 of 9 February on Environmental Licensing  (Portuguese original) requires projects which could have significant environmental effects to prepare Environmental Impact Assessments and Environment Management Plans (Art.4). The National Environment Directorate (DNMA, part of the Ministry of Commerce, Industry and Environment) creates a committee (Art.10) to evaluate the EIA and EMP, conduct public consultation (Art.11), and require improvements (Art. 12.3, 14.3) before recommending (Art.13) that a license be issued (Art.14). No one can begin implementing a project without a license (Art.23.5), subject to up to a quarter-million-dollar fine (Art.34.5). Licenses (as well as reasons for denial or special requirements) are to be published in the Jornál da Repúblika (Art.14.4, 21.4) and DNMA must maintain a public register of licenses, evaluations and other information (Art. 38).

Although the Decree-Law is not perfect, it could help protect Timor-Leste’s delicate ecosystems … if it were actually implemented. A few years ago, La’o Hamutuk participated in consultations on exploratory offshore drilling, and we also learned that the Suai Supply Base received a license last year (with no public consultation), but the Jornál da Repúblika has never mentioned an Environmental License.

Last January, La'o Hamutuk joined discussions with an ADB technical assistance project to improve environmental licensing processes, and it became clear that this law is violated far more often than it is obeyed.

We asked how many licenses had been granted, and a few weeks later ADB included a list from DNMA in a workshop presentation, showing that DNMA had issued eleven licenses, and five more were in process. Only two of the eleven were for large projects with major environmental impact (Category A under the Decree-Law): the now-abandoned Pelican Paradise resort project in Tasi Tolu, and the Suai Supply Base (SSB).

DNMA’s list said that the SSB License was “issued with political interference,” a precedent they didn’t want to repeat. As La’o Hamutuk has explained, the SSB license was issued last year without any public consultation or the required project-specific Environmental Management Plan. When we suggested that DNMA should implement clause 2.4 of this License -- “Due to serious violation of the EIA, EMP and Environmental License procedures, the RDTL environmental authority will suspend or cancel environmental license as described in Article 35(c) of Decree-Law No. 5/2011” -- everyone at the workshop smiled.

La’o Hamutuk then made a formal request (Tetum original) for information on licensing to date, and DNMA staff was cooperative. Although the public register doesn’t yet exist, in March they provided the table of licenses at right, as well as some of the licenses and other information.

Later, they told us that they were reviewing another Category A project, Esperanca Timor Oan (ETO)’s planned fuel depot in Hera, and provided the terms of reference for its upcoming licensing application.

However, we were sad to learn that many significant projects never contacted DNMA to initiate the licensing process. Multi-story buildings on two or more hectares of land are Category A, but DNMA has heard nothing from the builders of Timor Plaza (Tony Jape, Comoro), the Ministry of Finance building (Kampung Alor) or the Palm Business and Trade Center (Jackson Lay, Surik Mas), even though construction is far along for all three of these.

Even if a project uses less than two hectares, it still requires a license as Category B. The Prime Minister himself laid the cornerstone for AGP Square (Tommy Winata, Arthagraha Group Peduli, Kaikoli) last November, but DNMA has heard nothing about this project. Other large projects – the Hera and Betano power plants, Comoro bridges, tourism beach developments -- have also defied  licensing requirements. We listed a few of them in the following table, and we encourage people who know of other projects which require licenses (the criteria are annexed to the Decree-Law) to tell DNMA about them.

Project	Location	Owner	Status	Land Area	Cat.	License status
Timor Plaza 5-story building and several others	Comoro, Dili	Tony Jape	Some buildings finished, other construction continues	4 Ha	A	Never applied. Ground-breaking in 2009, opened 2011.
AGP Square 26-story building	Kaikoli, Dili	Tommy Winata, Arthagraha Group Peduli	Cornerstone laid, no work since	1.5Ha	B	Not yet applied. Ground-breaking Nov. 2013
Palm Business and Trade Centre	Surik mas, Dili	Jackson Lay	Mostly built	2 Ha	A	Never applied. Construction began in 2011, opened 2013.
Ministry of Finance 11-story Building	Kampung Alor, Dili	RDTL MoF	Mostly built	2 Ha	A	Never applied. Construction began in 2011, not yet finished.
Hera power station	Hera	EDTL, MOP	Built	3.5 Ha	A	Never applied. Construction began in 2009, operation in 2011.
Betano power station		EDTL, MOP	Built	82 Ha	A	Never applied. Construction began in 2010, operation in 2012.
Pacific Beach Resort	Dolok-oan	Tony Jape	Land clearing  started recently	22 Ha	A	Not yet applied
Dollar Beach	Metinaro	Tony Jape				Not yet applied
Trafigura fuel depot	Hera	Sacom Energia			A	Not yet applied
ETO fuel depot	Hera	Esperanca Timor Oan			A	TOR approved, application in process
Offshore oil drilling	Bayu-Undan, Kitan	Conoco-Phillips, Eni			A	Never applied to DNMA, new wells in 2013-4
MSS Building	Kaikoli, Dili	RDTL MSS	Built	0.7 Ha	B	Never applied, already built
Comoro Bridges I+II	Comoro, Dili	MTC/MPS	70% built	250m	B	Never applied, mostly built

After La’o Hamutuk’s inquiries, DNMA became more pro-active in publicizing licensing requirements, and started distributing a notification letter (right) to state agencies and private sector developers. We hope that this will be followed up with enforcement.

Among the long list of projects whose proponents have not engaged with DNMA, two are especially dangerous and worrisome. Trafigura, a European commodities trading company, plans to build a fuel storage depot in Hera, with the capacity to hold 90 million litres of oil, nine times the amount needed for Category A.
Together with their local partner Sacom Energia (headed by Abilio Araujo), Trafigura received a $73 million contract last March to supply fuel for the Hera and Betano power plants and delivered the first 12 million liters on 2 April. Trafigura comes with a long record of corruption and environmental devastation, including a recent $750 million case in Angola and one which poisoned 100,000 people in Côte D’Ivoire in 2006, and we hope that DNMA and other regulators will prevent them from inflicting similar damage in Timor-Leste.

Tony Jape, the developer of Timor Plaza, has never applied for a single environmental license. He recently began clearing more than 20 hectares of beachfront land in Dolok-oan, between Cristo Rei and Hera, for a tourist resort. Some have asked how Jape got permission to develop this public land and a similar tract at “Dollar Beach” in Metinaro (his projects in Darwin are also problematic), but this article focuses on environmental regulation. The precedents set here could protect (or endanger) many parts of Timor-Leste’s beautiful and fragile shoreline.

Timor-Leste has not had effective environmental protection during twelve years of independence, or for centuries before that. Although we appreciate the work of the State Secretariat for Environment in discouraging littering and planting trees, the most imminent dangers to our ecosystems are from large construction and industrial projects, which involve huge quantities of toxic chemicals that endanger health and could contaminate river ecosystems, ground water, agricultural land, oceans and the atmosphere.

We hope that Timor-Leste’s Government will become more effective in keeping our land and waters safe, clean and habitable, strengthening some communities’ use of Tara Bandu to protect their local areas. Government and project owners must make information available, consult with the people, and obey and enforce our laws, so that everyone can work together to protect Rai Furak ida ne’e.

Kontrolu ba Reguladór Petróleu sira

Link to this article in English

Maske Artigu 129 Konstituisaun Timor-Leste defini Tribunal Administrativo, Fiscal e de Contas, maibé Tribunal ne’e seidauk estabelese loloos. Maske nune’e, publikasaun rua ba audit foin daudauk ne’e hosi Tribunal Rekursu, ne’ebé hala’o knar interinu ba Tribunal de Contas nudár pasu inísiu ida ne’ebé importante. Câmara de Contas hala’o audit finansial ba instituisaun rua estadu nian – Autoridade Nasionál Petróleu (ANP) no Universidade Nasionál Timor-Leste (UNTL) – no sira publika iha sira nia website.

La'o Hamutuk halo tradusaun Ingles ba relatóriu ba ANP nian no ba rezumu no rekomendasaun ba relatóriu ba UNTL nian. Ami mós publika relatóriu orijinál kompletu iha Portuguese ba relatóriu ba ANP no ba UNTL iha ami nia website.

Audit rua ne’e identifika frakeza sira ne’ebé signifikante, maibé sira lori Timor-Leste tuir dalan governasaun di’ak liu nian, ne’ebé atu halo katak osan povu nian sei uza ho matenek no ba interese públiku nian ba iha futuru. ANP no UNTL hakerek resposta ketak-ketak ne’ebé Tribunal anexu ba Tribunal nia relatóriu rua ne'e. Sira korige no klarifika informasaun balun, justifika pratika balun, no konkorda atu konsidera mudansa barak.

Checks and Balances entre instituisaun Timor-Leste nian nudár salvaguarda esensiál tebes atu kontra korrupsaun no maljestaun. Ami espera katak ANP no UNTL sei implementa rekomendasaun sira ne’e ho lalais, no katak ajénsia estadu sira seluk, inklui Instituisaun Públiku no Negósiu Públiku nian ne’ebé hetan osan hosi Orsamentu Jerál Estadu nian, sei aprende hosi ne’e.

Artigu ida ne’e foka liu ba audit ba Autoridade Nasionál Petróleu (ANP) durante 2010-2012. Tribunal apresia buat barak ba pratika ANP nian, inklui sira nia kooperasaun di’ak ho auditor, maibé foka sai katak Relatóriu Anuál ANP nian (2010, 2011, 2012) dala barak publika tarde no la inklui informasaun finansial ne’ebé kompletu. Sira mós hateten ba ANP katak sira nia prosedimentu internal tenke aprova hosi órgaun sira ne’ebé tau matan ba sira – Komisaun Konjunta Australia-Timor-Leste no Ministériu Petróleu no Rekursu Minerais Timor-Leste nian – no katak sira nia prosesu aprovizionamentu nian tenke tuir Lei sira ba Aprovizionamentu Timor-Leste nian.

Timor-Leste nia osan lakon tiha dalan

ANP ne’e iha komponente rua. Parte ida, mak regula projetu petróleu sira iha Area Konjunta ba Dezenvolvimentu Petróleu (JPDA), nudár ajénsia bi-nasionál ne’ebé estabelese hosi Tratadu Tasi Timor 2002, ne’ebé finansia hosi pagamentu sira hosi kompañia petróleu no gas  ne’ebé iha kontratu iha JPDA (tokon $4.9 iha 2012), inklui Bayu-Undan, Kitan no Sunrise. Iha parte seluk, mak regula projetu petróleu no gas iha Area Eskluzivu Timor-Leste nian no atividade sira iha rai maran inklui prosesamentu no fan produtu petróleu nian, ne’ebé finansia hosi transferénsia ida hosi Orsamentu Jerál Estadu Timor-Leste, ne’ebé falun iha dotasaun ba Ministériu Petróleu no Rekursu Minerais nian (tokon $1.5 iha 2012, tokon $2.2 iha 2013, tokon $3 iha 2014). Tanba Tribunal foka sai ona, ANP la mantén iha sira nia dalan kona-ba osan hira mak sira gasta hosi parte ida-idak nian, tanba ne’e imposivel atu hatene osan ida ne’ebé mak sira hetan hosi kompañia no Governu ne’e gasta tuir nia dalan.

ANP iha osan surplus ho tokon $4.4 durante fin de 2012, inklui nia lukru tokon $0.8 durante iha 2012 de’it. Tanba labele sura ida-idak, Tribunal no ANP labele hateten sai osan hira hosi montante ne’e mak mai hosi atividade JPDA no hira mak transfere hosi Orsamentu Estadu Timor-Leste nian mak la gasta hotu. Hanesan Tribunal hatudu, imposivel atu hatene osan hira mak ANP sei presiza hosi fundu públiku Timor-Leste nian kada tinan.

Durante Komisaun Eventual nia enkontru ne’ebé taka ba públiku iha Janeiru liu ba, Parlamentu hasa’e transferénsia ba ANP hosi Orsamentu Estadu 2014 hosi tokon $2 ba tokon $3, ne’ebé La’o Hamutuk hatene katak ida ne’e ba avaliasaun independente ida ba projesaun ConocoPhillips ne’ebé halo redusaun ba reseita Bayu-Undan nian. Maske Tópiku ida ne’e ketak hosi prosesu audit Tribunal nian, La’o Hamutuk preokupa tanba sá mak despeza ida ne’e, ne’ebé iha ligasaun ho atividade JPDA nian, la selu ho pagamentu sira kompañia nian. ANP nia submisaun ba Parlamentu la mensiona ida ne’e.

Bainhira tinan 2012 remata, ANP iha tokon $6 iha banku, hosi ne’e ANP hetan de’it tokon $263 ba nia funan. Tribunal enkoraja ANP atu tau osan sira ne’e iha investmentu sira ne’ebé laiha risku, no bele lori funan, ne’ebé Tribunal estimatiza katak nia retornu bele liu 29,000 iha tinan ne’ebá.

Priviléjiu sira hosi kontabilidade ne’ebé fraku

Tinan rua liu-ba, La’o Hamutuk hakerek “Iha nasaun barak ne’ebé afeta ho malisan rekursu, ema ho oportunidade atu lasu osan husi atividade petróleu no gas sai priviléjiu ida, iha klase korruptu. Ami la hanoin katak buat ne’e akontese ona iha Timor-Leste, no espera katak buat ne’e sei nunka mais akontese.” Iha tempu ne’ebá ami preokupa katak ANP selu asisténsia saúde ne’ebé di’ak liu ba nia emar sira kompara ho asisténsia saúde ne’ebé funsionáriu estadu sira seluk bele asesu ba. Ami triste katak Tribunal hetan ezemplu barak tan hosi sentimentu ba direitu ida ne’e, no ami espera katak ANP sei nakloke an liu hodi simu sujestaun Tribunal nian kompara ho ida ne’ebé sira halo ba ami nia sujestaun.

Tribunal foka sai katak ANP nia prosesu fó kontratu no aprovizionamentu nian, hala’o tuir sira nia regulasaun internal, ne’ebé dala barak involve de’it ema ida no laiha regra ne’ebé klaru, hodi halo ANP fasil liu ba kollusaun, fraude ka korrupsaun sira seluk.

Tuir Tribunal nia Audit ANP gasta tokon $2.3 (43% hosi sira nia despeza) ba iha sira nia personalia iha 2012 no 20% seluk ba iha konsultador sira. ANP rasik deside sira nia eskalaun saláriu nian, ne’ebé la hetan aprovasaun hosi Ministériu Petróleu ka Komisaun Konjunta. Kustu personalia ANP nian rata-rata $29,256 kada funsionáriu, liu dala lima kompara ho rata-rata ne’ebé funsionáriu públiku, jestor no assessor sirane’ebé servisu ba Timor-Leste hetan. Iha 2012, ANP nia funsionáriu na’in rua deit mak mai hosi rai li’ur; dezde 2013 nia klaran funsionáriu na’in 78 tomak mesak Timor-oan. ANP nia resposta husu tribunal atu labele kompara ANP nia remunerasaun ho funsionáriu públiku sira seluk, tanba "natureza indústria petrolíferu, ne’ebé ANP tenke faz parte, no papél importante ANP nian atu konstrui Estadu Timor-Leste, no realidade katak asuntu saláriu ne’ebé sensitivu politikamente."

Aleinde ba sira nia saláriu, ANP nia funsionáriu sira mós hetan Fundu Pensaun ida (iguál ba 15% hosi sira nia saláriu, hamutuk $226,000 iha 2012, ne’ebé sira sei simu bainhira sira sai hosi ANP), seguru ba saúde nian ($51,000 iha 2012), no reembolsa ba servisu saúde nian ne’ebé la limita ($29,000 iha 2012). Sira mós hetan osan ba sira nia feriadu família nian ($2,400 ba kada família ho ema na’in hat, hamutuk $102,000 iha 2012), ne’ebé sei selu maske sira la hala’o viajen ba feriadu nian. Hanesan Tribunal hatudu sai, pagamentu sira ne’ebé bele halo ba ema estranjeiru sira ne’ebé husik sira nia rai hodi mai servisu, maibé funsionáriu ANP nian” la’ós ema sira hosi rai li’ur, ho liafuan seluk, sira halo servisu ba sira nia nasaun rasik, Timor-Leste.” Hodi aumenta kanek ba insultu nian, benefísiu hirak ne’e barak mak tenke sujeitu ba taxa vensimentu no taxa retensaun nian, maibé ANP la selu taxa balun ne’ebé sira tenke selu.

Semo (no selu) as

Tribunal mós kritika ba ANP tanba la tuir prosedimentu aprovizionamentu standar Timor-Leste nian, ka sira nia polítika internal hodi hetan maizumenus kotasaun rua ba kada kompras ne’ebé liu $500. Tribunal kritika ANP tanba sosa billete aviaun nian no akomodasaun nian ho ajudikasaun direta (single-source, la loke tender nakloke ida) no foka sai katak ajénsia viajen rua – Harvey World Travel (kompañia Australia nian ida ne’ebé nia eskritóriu iha Dili) no Ratna Artha Wisata (kompañia Indonézia ida iha Bali) – hamutuk hetan osan liu tokon ida hosi ANP durante 2010-2012. Iha 2012 de’it, ANP selu ba Ratna Artha Wisata $314,455. Iha ezemplu seluk, Tribunal deskobre osan ANP selu liu tokon $44,600 ba billete neen entre Dili no Brisbane iha 2010. Kada billete nia kustu $7,441, kustu ne’e dala tolu kompara ho viajen ba klase bisnis aviaun nian no dala walu kompara ho kustu ba klase ekonomia nian.

Tribunal rekomenda “katak ANP tenke urjentemente muda sira nia dalan bainhira sosa billete aviaun nian, tanba sira nia pratika la promove kompetisaun entre fornesedór sira no risku sira ne’ebé tuir prinsipiu despeza públiku nian ne’ebé ekonomia, efikás no efetivu.” Maske Tribunal la halo alegasaun korrupsaun ka kollusaun, ami espera katak Prokurador-Jeral, Komisaun Anti Korrupsaun no/ka Provedor ba Direitus Humanus no Justisa nian sei buka hatene se mak hetan benefísiu liu hosi pratika sira ne’e.

Konkluzaun

La’o Hamutuk predikte ona problema sira ne’e dezde inísiu 2007, bainhira ezbosu primeiru ba Dekretu Lei ANP nian sirkula sai. Iha ami nia submisaun ho pájina 31 kona-ba ezbosu iha 2008 ne’ebé ikus mai sai lei, ami husu atu “iha kreatividade, checks and balances, envolvimentu públiku, estabilidade, transparénsia, tau matan ida ne’ebé independente, kontabilidade no efetividade legal liu duke saida mak ezbosu lei ne’e iha, no ami nafatin ezije esforsu ida ne’ebé kuidadu no konsiensiozu atu aprende hosi problema sira seluk hosi fatin seluk bainhira  aprova lei ne’ebé sei proteje loloos sidadaun Timor-Leste nia jerasaun ohin no aban-bainrua nian.”

La’o Hamutuk nia submisaun ba Orsamentu Jerál Estadu repete bei-beik hodi husu ba kontabilidade segredu no fraku hosi ANP ne’ebé uza osan povu nian. Ba ezemplu, iha Janeiru 2013 ami hateten ba Parlamentu “TimorGAP, IPG no ANP presiza duni fiskalizasaun ne’ebé hanesan ho ajénsia estadu tomak sira seluk, inklui fiskalizasaun hosi Parlamentu. Ami kontinua hodi enkoraja Parlamentu atu husu relatóriu orsamentál no finansial hosi instituisaun sira ne’e. ... Karik Parlamentu aprova finansiamentu ida ne’e lahó informasaun sira ne’ebé adekuadu, ita-boot sira falla duni atu hala’o knar tuir Artigu 95 Konstituisaun RDTL.”

Timor-Leste tenke orgullu no sente hakmatek katak instituisaun estadu nian ida, Tribunal interinu ba Administrativo, Fiscal e de Contas, hala’o ona nia responsabilidade Konstitusional nian ho sériu tebes. Ami espera katak sira sei halo audit ba instituisaun públiku sira seluk, no órgaun sira ne’e sei implementa Tribunal nia rekomendasaun ho lalais. Ne’e sei sai di’ak liu tan bainhira entidade públiku tomak estuda relatóriu sira ba ANP no UNTL no foti pasu ohin atu hadi’ak pratika sira ne’ebé sei menus ne’ebé dala ruma Tribunal bele kestiona iha futuru. Maioria hosi buat sira ne’e hatudu momoos hela.

Checking the Petroleum Regulators

Liga ba artigu ida ne'e iha Tetum

Although Article 129 of Timor-Leste’s Constitution defines the High Administrative, Tax and Audit Court (Tribunal Administrativo, Fiscal e de Contas), it is still not fully established. However, the recent publication of two audit reports by the Court of Appeals, which serves as the interim Tribunal de Contas, is a major milestone. The Court’s Audit Chamber (Câmara de Contas) carried out financial audits of two state institutions – the National Petroleum Authority (ANP) and the National University of Timor-Leste (UNTL) – and posted them to its website.

La'o Hamutuk has made English translations of the ANP report and the summary and recommendations of the UNTL report. We have also posted the complete Portuguese original ANP and UNTL reports to our website.

Both audits identified significant weaknesses, but they move Timor-Leste toward better governance, which makes it more likely that the people’s money will be used wisely and for the public interest in the future. Each agency wrote a response which is appended to the Court's report -- they corrected and clarified information, justified some of their practices, and agreed to consider many changes.

Checks and balances between Timorese institutions are essential safeguards against corruption and mismanagement. We hope that ANP and UNTL will implement the Court's recommendations quickly, and that other state agencies, including Public Institutions and Public Businesses on the margins of the General State Budget, will take note.

This article focuses on the audit of the National Petroleum Authority (ANP) during 2010-2012. The Court appreciated many of ANP practices, including its good cooperation with the audit, but pointed out that ANP Annual Reports (2010, 2011, 2012) are often late and do not include complete financial information. They also told the ANP that its internal procedures must be approved by its overseers – the Australia-Timor-Leste Joint Commission and Timor-Leste’s Minister for Petroleum and Mineral Resources – and that its procurement processes should comply with Timor-Leste’s Procurement Laws.

Losing track of Timor-Leste’s money

The ANP has two components. One part, which regulates petroleum projects in the Joint Petroleum Development Area (JPDA), is a bi-national agency established by the 2002 Timor Sea Treaty, funded by fees from oil and gas companies with contracts in the JPDA ($4.9 million in 2012), including Bayu-Undan, Kitan and Sunrise. The other part, regulating oil and gas projects in Timor-Leste’s Exclusive Area and onshore activities including processing and sale of petroleum products, is financed by a transfer from Timor-Leste’s General State Budget, hidden in the appropriation for the Ministry for Petroleum and Mineral Resources ($1.5m in 2012, $2.2m in 2013, $3m in 2014). As the Court pointed out, ANP does not keep track of how much money is spent by each part, so it is impossible to know whether the money it receives from the companies and from the State are being used appropriately.

ANP had accumulated a cash surplus of $4.4 million by the end of 2012, including $0.8m profit in 2012 alone. Given the lack of separate accounting, the Court and ANP cannot tell how much of this is from JPDA activities and how much was unused money transferred from Timor-Leste’s budget. As the Court pointed out, this makes it impossible to know how much money ANP will need from Timor-Leste public funds each year. 

During the closed-door Ad-hoc Budget Committee last January, Parliament increased the appropriated transfer to ANP from the 2014 State Budget from $2 million to $3 million, which La’o Hamutuk was told is for an independent evaluation of ConocoPhillips projections of reduced Bayu-Undan revenue. Although this topic is outside the scope of the Court's audit, La’o Hamutuk wonders why this expense, which relates to JPDA activities, is not being paid for with company fees. ANP's submission to Parliament did not mention it.

When 2012 ended, ANP had $6 million in the bank, on which it earned just $263 in interest. The Court encouraged ANP to put this into no-risk, interest-bearing investments, which the Court estimated could have returned more than $29,000 that year.

Privileges from lack of accountability

Two years ago, La’o Hamutuk wrote “In many resource-curse afflicted countries, people with the opportunity to skim money from oil and gas activities become a privileged, corrupt class. We do not think this has happened yet in Timor-Leste, and hope it never will.” At the time, we were concerned that the ANP was purchasing better health care for its people than was available to other state employees. We are saddened that the Court found more examples of this sense of entitlement, and we hope that ANP will be more receptive to the Court’s suggestions than they were to ours.

The Court pointed out that ANP’s hiring and procurement processes, conducted according to its internal regulations, often involve only one person and have unclear rules, making them vulnerable to collusion, embezzlement or other corruption.

According to the Court’s Audit, ANP spent $2.3 million (43% of its expenditures) on personnel in 2012 and another 20% on consultants. The ANP sets its own salary scales, which have not been approved by the Petroleum Ministry or Joint Commission. ANP personnel costs averaged $29,256 per employee, more than five times the average for other civil servants, managers and advisers employed by Timor-Leste. In 2012, two ANP staff were internationals; since mid-2013 all 78 staff are Timorese. In its response, ANP asked the court not to compare its remuneration with that of other public servants because of "the nature of oil industry, of which the ANP is unavoidably a part, and the important role that ANP plays in the process of building the State of Timor-Leste and the fact that salary issues are politically sensitive."

In addition to their salaries, ANP staff receive a Pension Fund (equal to 15% of their salary, totaling $226,000 in 2012, which they get when they leave ANP), health insurance ($51,000 in 2012), and unlimited health care reimbursements ($29,000 in 2012). They also get money for family vacations ($2,400 for each family of four, totaling $102,000 in 2012), which is paid even if they don’t take a trip. As the Court pointed out, this may be expected by foreigners who leave their home countries to work, but ANP staff “are not expatriates, in other words, they do their work in their country of origin, Timor-Leste.”  To add injury to insult, many of these benefits should be subject to wage and withholding tax, but ANP does not pay all the taxes they owe.

Flying (and paying) high

The Court also cited ANP for not following standard Timor-Leste procurement procedures, or even its own internal policy of obtaining at least two quotes for any purchase over $500. They criticized the agency for purchasing airplane tickets and accommodation by direct award (single-source, without an open tender) and pointed out that two travel agencies – Harvey World Travel (an Australian company with a Dili office) and Ratna Artha Wisata (an Indonesian company in Bali) – together received over a million dollars from ANP during 2010-2012. In 2012 alone, ANP paid Ratna Artha Wisata $314,455. In another example, the Court described how ANP paid more than $44,600 for six tickets between Dili and Brisbane in 2010. At $7,441 per ticket, this is three times the round-trip business class fare and eight times what it should have cost to fly economy class.

The Court recommended “that the ANP must urgently change the way it purchases airline tickets, since its practice does not promote competition between suppliers and jeopardizes compliance with the principles of economy, efficiency and effectiveness of public expenditure.” Although the Court did not allege corruption or collusion, we hope that the Prosecutor-General, Anti-Corruption Commission and/or Provedor (Ombudsman) will find out who benefited from these practices.

Conclusion

La’o Hamutuk has predicted such problems since early 2007, when the first draft of the ANP Decree-Law was circulated. In our 31-page submission on the 2008 draft which eventually became law, we asked for “more creativity,  checks and balances, decentralization, public involvement, stability, transparency, independent oversight, accountability and legal effectiveness than is in the current draft law, and we again urge a careful and conscientious effort to learn from problems elsewhere to enact laws which will truly protect current and future generations of Timor-Leste citizens.”

La’o Hamutuk’s submissions on the General State Budget have repeatedly questioned the secrecy and the lack of accountability for ANP usage of the people’s money. For example, in January 2013 we told Parliament "TimorGAP, IPG and ANP merit the same budgetary scrutiny and financial oversight as all other state agencies, including by Parliament. We continue to encourage Parliament to require budgets and financial reports from these institutions. …. If Parliament approves this funding without adequate information, you will fail to meet your responsibilities under Article 95 of the RDTL Constitution.”

Timor-Leste should be proud and relieved that one state institution, the interim High Administrative, Tax and Audit Court, is taking its Constitutional responsibilities seriously. We hope that they will audit other public institutions, and that these bodies will implement their recommendations promptly. It would be even better if every public entity studied the reports on ANP and UNTL and took steps now to fix defective practices the Court might question in the future. Most of them are pretty obvious.

Double digit lakon ona

Link to this article in English

Lider Timor-Leste sira dala barak orgullu katak Timor-Leste nia kreximentu GDP (Produto Internu Bruto ka PIB) naun mina-rai sa’e liu 10% kada tinan, lalais liu kompara ho inflasaun global – katak, iha “nivel double-digit.” Ezemplu mak, semana kotuk Primeiru Ministru ko’alia ba investidór potensiál sira iha Malázia katak “Dezde 2007, ami nia medida ba nivel kreximentu nian iha 11.9% no Banku Dezenvolvimentu Aziátiku (ADB) halo predisaun katak kreximentu nivel double digit sei kontinua ba futuru.”

Maski nune’e, Banku Mundial nia Pacific Economic Update (ba parte Timor-Leste), fó sai iha Tersa-feira foin lalais ne’e, hateten sai istória ida ne’ebé diferente, no mós  ADB nia Asian Development Outlook (ba parte Timor-Leste) ne’ebé publika semana kotuk, FMI nia relatóriu Article IV kona-ba Timor-Leste hosi Dezembru 2013, no Ministériu Finansas nia analiza fulan rua antes halo hanesan mos. Ne’e la’ós imajen ida ne’ebé optimistiku teb-tebes, maibé ida ne’e klaru no tenke sai input importante ba ukun-na’in sira. Hanesan iha tabela ida ne’e ne’ebé Banku Mundial hatudu sai, iha 2015 Timor-Leste sei sai nasaun ho kintu lugár iha rejiaun ne’ebé nia kreximentu GDP nian lalais liu. Outubru liu ba, Banku Mundial nia relatóriu tau Timor-Leste iha segundu lugár.


Bainhira Ministériu Finansas Timor-Leste halo proposta ba Orsamentu Jerál Estadu 2014 iha Outubru liu ba, sira redús sira nia estimasaun anterior ba kreximentu GDP nian iha 2012 hosi 10.6% ba 8.1%, no mós redús sira nia projesaun ba kreximentu iha 2013 hosi 10.6% ba 8.2%. Ba pasadu, ajénsia internasionál sira uza númeru Governu nian de’it, nune’e sira halo tuir de’it saida mak iha tiha ona.

Ministériu Finansas mós hatún projesaun ba kreximentu iha futuru. Ajénsia internasionál sira halo sira nia projesaun rasik, no sira hatún liu tan iha Governu nia projesaun nia okos. FMI no Banku Mundial daudauk ne’e halo predisaun katak kreximentu GDP naun mina-rai sei tun gradualmente, tun ba 7.7% iha 2015. Hafoin ne’e, sira hein katak Governu nia despeza atu sa’e, espesialmente despeza ba iha projetu infrastrutura sira, ne’ebé sei estimula tan kreximentu GDP ne’ebé lalais liu. Infelizmente, laiha ema ida mak antisipa ba kreximentu signifikante ba iha GDP produtivu nian (hanesan Agrikultura no maun de obra) ba maizumenus tinan balu oin mai.

Sura liu ba kreximentu GDP iha futuru sei fó kusta tokon dolar ne’ebé barak ba Timor-Leste. Outubru liu ba, konvite atu harii no halo operasaun ba Portu Tibar hateten ba konkorrente potensiál sira katak “Timor-Leste nia ekonomia sa’e maka’as no FMI nia predisaun real ba kreximentu GDP naun mina-rai maizumenus iha 10%, durante ba tinan lima oin mai.” Kompañia sira daudauk ne’e iha ona prosesu pre-selesaun nian, no konvite ba konkursu ba Parseria Públiku Privadu nian sei fó sai iha fulan ida ne’e nia laran. Karik trafiku portu nian muda tun no menus liu kompara ho ita ne’ebé ita ekspeta (revizaun foin lalais ne’e ba estimasaun GDP nian sei redús ida ne’e ba 16% ka liu), nune’e, Timor-Leste tenke kompensa hodi selu kompañia sira tanba sira  nia rendimentu tun.

Tabela tuir mai lista hela figura kreximentu GDP nian hosi fonte no dadus barak, ida ne’ebé foun liu iha lista primeiru

Estimatizasaun no projesaun sira ba kreximentu "real" GDP naun-mina Timor-Leste nian kada tinan
No.	Fonte	Data uza	2011	2012	2013 (est)	2014 (proj)	2015 (proj)	2016 (proj)
0	FMI World Economic Outlook	1/14 4/14	12.1%	9.3%	8.4%	9.1%	8.8%	9.9%
1	World Bank EAP Economic Update	4/14		8.3%	8.1%	8.0%	7.7%	8.6%
2	ADB Asian Development Outlook	4/14	12.1%	8.2%	8.0%	8.5%	8.5%
3	FMI Konsultasaun Artigu IV Consultation	12/13	12.0%	8.3%	8.1%	8.0%	7.7%	8.6%
3a	Total GDP (inklui mina) [3] FMI Konsultasaun Artigu	12/13	7.3%	5.7%	-3.2%	-6.9%
4	Orsamentu Jeral Estadu RDTL 2014	10/13 3/14	12.0%	8.2%	8.0%	8.8%
5	Hamburg Port Consulting (IFC) [2]	1/13 10/13	10.6%	10.9%	10.4%	9.9%	10.8%	11.5%
6	World Bank EAP EU	10/13	10.8%	10.6%	10.4%	10.2%	11.5%
7	ADB Asian Development Outlook	4/13	10.8%	10.6%	10.0%	10.0%
8	Orsamentu Jeral Estadu RDTL 2013	12/12 4/13	10.8%	10.6%	10.4%
9	FMI Konsultasaun Artigu IV	1/12	10.6%	10.0%	10.0%	10.0%	10.0%	10.0%
Notas: 1.     Kronolojia iha liña tabela nian ne’e muda, nune’e ida ne’ebé foun liu iha leten liu no tuan mak iha okos liu. Bainhira dadus rua mak fó sai ona, entaun hatudu katak sira fó sai dala ida tan. Lina tabela sira hosi 6-9 troka ona ho estudu sira ne’ebé foun liu. 2.     Lina tabela 5, bazeia ba projesaun tuan, projesaun ne’e sei uza atu halo planu ba portu foun ba kontainer iha Tibar. 3.    Anaunsérke liña tabela 3ª nian, hatudu figura tomak ba kreximentu real GDP naun mina-rai nee (halo ona korresaun ba inflasaun). Lina tabela 3ª mós inklui GDP hosi produsaun petróleu no gas, ne’ebé nia total liu 75% no hahú tun dezde 2012 tanba nia rezerva supa sai ona. GDP ne’e sei kontinua tun bainhira Bayu-Undan nia produsaun tun ba zero iha tinan neen oin mai.  4.    Liña 0 foin aumenta hafoin blogue ida ne’e publika tiha ona, tanba FMI foin publika sira nia dadus hafoin loron tuir mai.
Tabela ne’e kompila hosi Lao Hamutuk bazeia ba dokumentu sira ne’ebé refere ba. Abril 2014

GDP la’ós dalan di’ak ida atu sukat dezenvolvimentu ekonomia ne’ebé justu. GDP sura de’it osan, la’ós povu, tanba ne’e ema kiak sira ne’e la reprezenta hosi GDP. Iha tempu ne’ebé hanesan, ekonomia ida bele iha kreximentu GDP ne’ebé as, mai hamutuk ho númeru ema barak ne’ebé mak moris iha pobreza – klaru katak ida ne’e mak Timor-Leste nia situasaun dezde 2007. Aleinde ne’e, kreximentu populasaun ne’ebé sa’e lalais hamenus tiha GDP nia benefísiu ba kada ema ka ba kada família, no inflasaun nasionál sa’e maka’as liu tan kompara ho inflasaun global, hodi separa GDP “real” hosi kapasidade kompras ba ema sira ne’ebé kiak no ema sira hosi klase médiu.

Liu ¾ hosi GDP Timor-Leste nian mai hosi faan rezerva naun renovavel petróleu no gas, ne’ebé mós fornese maizumenus 93% Estadu nia rendimentu. Maski nune’e, GDP naun mina-rai ne’ebé diskute iha leten la inklui iha parte GDP ida ne’e, la hanesan ho estatístika iha rai seluk. Banku Mundial esplika katak GDP naun mina-rai mak “Timor-Leste nia preferénsia atu sukat atividade ekonómiku nian” tanba ida ne’e responsivu liu ba desizaun polítika nian duke petróleu, ne’ebé supa hosi kompañia rai li’ur sira no fan iha merkadu global. Timor-Leste nia rendimentu petróleu to ona nia másimu produsaun iha 2012 no sei tun iha dékada ida tuir mai, nune’e total kreximentu GDP nian sei negativu durante tempu sira hafoin mina-maran, hanesan hatudu iha liña 3ª iha tabela leten.

Problema seluk mak GDP naun mina-rai barak liu mak mai hosi gastu Estadu nian (hosi osan mina-rai nian). Faktu katak, sein konstrusaun, administrasaun públiku, parte boot hosi merkadorias no bens imobiliáriu sira hosi Governu, laiha kreximentu ba GDP naun min-rai. Setór produtivu sira – agrikultura no maun de obra – ne’ebé boot iha 2003 kompara ho 2011 (dadus ikus liu bele hetan iha ne’e), maski seidauk ajusta ho populasaun.

Loron hafoin ami publika artigu ida ne’e, FMI publika iha sira nia  World Economic Outlook ne’ebé atualiza, hodi halo estimatizasaun ne’ebé sa’e uitoan ba kreximentu GDP ba Timor-Leste kompara ho relatóriu seluk foin-daudauk ne’e, maibé nafatin iha 10% nia okos, hanesan hatudu iha Liña) iha tabela iha leten. Maske nune’e, FMI hateten sai katak figura sira ne’e mai hafoin halo tiha estimasaun ba tinan 2011 nian ( maske sira atualiza iha Janeiru 2014) no iha figura balu ne’e la konsistente ho dadus ne’ebé verifikavel liu.

Relatóriu hira mak sei halo atu lori ukun na’in no setór privadu sira iha Timor-Leste hodi fokus ba servisu sira ne’ebé todan no la glamour hanesan dezenvolvimentu agrikultura, indústria ki’ik, turizmu ne’ebé apropriadu, no prosesamentu ai han atu redús defisit merkadorias no kria ekonomia ida ne’ebé la depende ba despeza ida ne’ebe mai hosi rezerva petróleu? Ita laiha ona tempu barak.