Trucking and Illegal Payments in Aceh 2005 Showed Average Costs of Rp

Home , Banda Aceh

Organization Satu is a trucking firm that has branched out into The number of posts where trucks have to stop to pay bribes in Trucking and Illegal Payments in Aceh 2005 showed average costs of Rp. 650,000. For the two On the route to Banda Aceh, there was an initial rapid drop As can be seen in Figure 3, the number of TNI (military) posts Two weigh stations exist on the Banda Aceh-Medan road: one offering services for other trucks such as ‘facilitation’ at weigh each province is similar, with an average of 5.7 in Aceh and 7.8 in weeks beginning November 4th, when monitoring started, between early November and mid-December, before where fees are charged reduced from 7 to 2 over the course of in Gebang, Langkat district, North Sumatra; the other in stations. Members of Organization Satu are usually trucks that North Sumatra. However, more than double the amount is paid at average payments on the road were Rp. 388,750. More payments started to climb again to an average of Rp. 397,400 the monitoring. Brimob (Brigade mobil Ð paramilitary police) Seumadam, Aceh Tamiang district, in Aceh. The are massively overweight. In order to use the service, trucks are North Sumatran posts than Acehnese ones: Rp. 57,703 on recent interviews with truck drivers indicate that illegal for the two-week period beginning January 27th. There was a posts have by and large disappeared. Posts that remain are characteristics of illegal payments are different at each. required to pay around Rp. 100,000 for each journey before average in North Sumatra, compared to Rp. 23,178 in Aceh. payments fell over the course of 2005 due to a number of sharp decline in payments at the end (fees averaged only Rp. most likely to be manned by regular police forces. Indeed, departure. Facilitation includes a decrease in overweight fines to factors including the pull-out of military troops and police as 134,000 for the two-week period starting February 20th) but after an initial drop-off in the number of police posts, there has When trucks stop at the Gebang weigh station, they Rp. 50,000-70,000 at the Gebang station (Organization Satu only The recent steep drop in payments in North Sumatra appears to part of the Helsinki peace agreement and the arrival of the this appears to be an anomaly and the average is based on a been a rise in the last month. Police personnel are starting to commonly pass bribes to DLLAJ officials working the station. covers North Sumatra), regardless of weight. There appears to be relate to efforts on the part of the provincial police chief to clamp Public Disclosure Authorized Aceh Monitoring Mission (AMM). limited number of truck journeys. occupy many of the posts left vacant by military and Brimob Until recently, provincial law 7/2002 governed fees at weigh collusion between Organization Satu and the local DLLAJ down on roadside pungli (extortion). In late January, a widely who have departed as part of the peace process. workers, with revenue generated shared between the two. publicized statement was made about efforts to get rid of illegal stations in North Sumatra, with trucks meant to pay Rp. fees, and this appears to have lowered on-road payments. Table 1 shows the average illegal on-road payments on the On the route from Banda Aceh to Medan, fees increased 50,000 per ton they were overweight directly to DLLAJ Organization Dua, which is organized by a preman (criminal) However, continued monitoring will be needed to see if this trend Banda Aceh-Medan road Ð at posts and weigh stations Ð for through November to a high of Rp. 657,000 for the December Figure 3: Numbers of Posts (TNI, Brimob, Police) Ð Trips to officials. In November 2005, this law was superceded by group, provides security and insurance against theft from trucks. holds. trips into Aceh, trips from Aceh, and the average across all 12th-15th period. They fell off in December, but have started Banda Aceh from Medan national legislation that says that drivers should not pay any It covers many trucking routes over Sumatra, with its Medan- trips. to climb again. For the final two-week period, combined fees fees at stations, with overweight trucks having a court hearing Banda Aceh operation opening in early 2005. Each route is run Different Costs for Different Goods averaged Rp. 390,000 per truck, higher than the November instead. However, the old system still operates, except that by a division, with each division having a large degree of Table 1: Average On-Road Illegal Payments (Posts and Weigh total. the common fee is Rp. 20,000 per overweight ton. Common autonomy over price setting and its operations. Most trucks are A variety of goods were carried on the monitored trucks going in Stations) on the Banda Aceh-Medan road by Time Period practice is for drivers to hand over their papers, with money members of Organization Dua. All Organization Dua members and out of Aceh. Figure 6 shows the percentage of trucks Forms of Illegal Payments hidden inside. None of this money goes into the state coffers. are required to pay a registration fee of Rp. 120,000 and a carrying different loads for each direction. For trucks driving in to 2 week Both directions To Aceh From Aceh Rates of payment at the Gebang station stayed high over the monthly fee of Rp. 25,000. Trucks that do not pay Organization Aceh, 75% carried household goods, 35% food (ingredients and period Average # Trips Average # Trips Average # Trips There are a number of forms of illegal payments. course of the monitoring, although rates of issuance of official Dua money often experience ‘theft’ on the road. prepared), 28% construction material, 25% drinks and 16% scrap starting Cost (Rp.) Observed Cost (Rp.) Observed Cost (Rp.) Observed tilangs also increased during the period under observation. mental. For trucks leaving Aceh, 59% were carrying scrap metal, 4th Nov 388,750 4 497,500 2 280,000 2 Police and Military Posts. Along the Banda Aceh-Medan Organization Tiga used to help facilitate trucks crossing the North 30% plastic goods and 22% empty bottles. 18thNov 177,000 8 232,750 4 121,250 4 road, the police and military run roadside posts. Drivers are In contrast, it is harder to pay bribes at the Seumadam station Sumatra-Aceh border. Before the pull-out of troops associated 2nd Dec 123,400 5 198,000 2 73,667 3 requested to stop at these and to pay a fee, normally in cash in Aceh, and the bribes that are paid are substantially smaller with the peace agreement, drivers would have to pay massive Figure 6: Goods Carried By Trucks In and Out of Aceh on Banda th but sometimes in the form of drinks such as Krating Daeng (a fees at the border and were often subject to harassment and 16 Dec 159,944 9 197,100 5 113,500 4 than at Gembang. In Seumadam, truck drivers stop before Aceh - Medan Road th popular energy drink) as well. violence. As the troops left, Organization Tiga has tried to change 30 Dec 147,833 9 322,625 4 8,000 5 they reach the weigh station and walk the last few hundred Public Disclosure Authorized th its role to offer a combination of the weigh station and security 13 Jan 212,333 9 263,571 7 33,000 2 meters to tell DLLAJ officials that the truck is overweight and th Weigh Stations. The DLLAJ (Provincial Land Transportation services provided Organization Satu and Organization Dua. 0.8 27 Jan 222,100 10 357,400 5 86,800 5 to begin the process of bargaining for the fee to be paid. After th Agency) runs two weigh stations on the Banda Aceh-Medan Members are required to pay a registration fee of Rp. 100,000 and 0.7 Bribes and illegal payments that truck drivers pay on the As Aceh opened up after the tsunami, such fees 20 Feb 96,400 5 67,333 3 140,000 2 paying the agreed amount, the driver brings the truck into the a monthly fee of Rp. 55,000. Members pay Rp. 10,000 per Banda Aceh - Medan road constitute a major cost to doing constituted a significant tax on the reconstruction and route. The stations are meant to weigh trucks to prevent them station for formality purposes only. Since mid-February, pungli 0.6 from carrying overweight cargos. According to national overweight ton at the weigh stations. Where accidents occur, business in Aceh. On average, trucks traveling to Banda recovery effort. Interviews with truck drivers conducted by The costs of on-road payments are significantly higher for (extortion) has started to decrease with more overweight Organization Tiga assists in handling documentation. 0.5 Aceh from Medan pay Rp. 321,000 in bribes, extortion and the World Bank in March 2005 revealed that trucks going legislation, trucks that are overweight are supposed to be tickets issued. However, the process depends on which shift trucks coming in to Aceh from Medan than for those leaving issued an official citation (surat tilang). They must 0.4 other illegal fees. Those traveling in the other direction from Banda Aceh to Medan were asked to pay bribes at Aceh. On average, trucks headed for Banda Aceh pay Rp. is working. While some officials will now not take bribes, Organization Empat provides similar services at weigh stations, subsequently appear in court and pay a fine determined by a There has been a gradual decline in the amount paid at each 0.3 average Rp. 366,296. These costs have a substantial between 70 and 110 different posts during a single trip. At 236,500 while those leaving Aceh pay Rp. 94,074. others are happy to do so. with members also paying Rp. 10,000 per overweight ton. Percentage judge. Instead, however, those at the weight station often post for trips in to Aceh. For the November 4th-17th period, 0.2 impact on tsunami reconstruction and are carried over to each post, the truck driver was required to give some form Monthly fees are Rp. 50,000 for this service. All members have a consumers in the form of increased prices. of illegal payment, ranging from a few thousand Rupiah, to accept payments on the spot, and take bribes to reduce the drivers paid on average Rp. 8,800 per post when they were Convoy Fees sign in the center of their windshield with the Organization Empat 0.1 However, if convoy fees and other ‘facilitation’ fees (see below) amounts paid. stopped. This stayed fairly constant until January 27th, when a pack of cigarettes, to as much as Rp. 100,000. While in are included, costs are higher in both directions. Including logo. Some also bear the inscription of a military command unit. 0 the average fee fell below Rp. 6,000, and for the last two-week Only trucks leaving Aceh pay convoy fees. Trucks that are HouseholdConstruction....Drinks goodsEmptyFood bottlesPrepared ingredientsSteel FurniturefoodCars/motorcyclesElectronicsPlasticMedicines goodsChemicalsSandPlastic Goods In order to quantify and assess the amount truck drivers many cases the individual fees collected at each post were convoy fees Ð which are only charged for trucks leaving Aceh Convoy Fees. Some trucks traveling from Banda Aceh to period, drivers paid just under Rp. 3,000 per post. For trips carrying goods such as scrap metal, plastics and bottles pay Organization Lima helps trucks who are in traffic accidents. have to pay, BRR and the World Bank started monitoring small, total amounts were high. Trucks heading to Banda Ð brings the cost of exporting goods from Aceh on journeys to Medan pay convoy fees to the military police. Trucks who pay out of Aceh, fees paid at posts fell earlier; average amounts Fewer trucks use this service. payments beginning in early November 2005. Data was Aceh from Medan carrying consumer goods paid an Medan to Rp. 366,296. Including ‘facilitation’ fees Ð which are these fees. To transport such goods, it is necessary to get these fees are usually carrying goods of dubious legality, per post dropped to under Rp. 2,000 at the end of 2005, and official documentation. To save on time, and to avoid collected by direct observation with surveyors average of Rp. 650,000 in illegal payments per trip. While charged in Medan Ð brings the average cost for trucks including scrap metal. have remained under Rp. 3,000. These fees Ð particularly the per-journey fees Ð constitute a accompanying truck drivers on their regular journeys from humanitarian aid was exempt, other goods needed for traveling to Banda Aceh to Rp. 321,000. These extra costs are government inspection, trucks pay fees to be accompanied by

Public Disclosure Authorized a convoy. 16 of the 27 trucks in our sample traveling from Aceh significant tax on trucking. For 13 of the 59 truck journeys, trucks Banda Aceh to Medan and back. Overall, 59 journeys reconstruction were not. These illegal payments not only having an impact on the tsunami reconstruction process. ‘Facilitation’ Agencies. A number of organizations provide With the presence of the AMM and international tsunami paid facilitation fees (normally to Organization Satu) averaging Rp. were surveyed from November 2005 through February have an impact on truck drivers and firms, but the costs to Medan (59%) paid convoy fees: eight paid fees to Brimob, To Aceh From Aceh various ‘services’ to trucks who pay them fees. Services reconstruction NGOs, security personnel have, in many cases, six to preman groups, one to the regular police (polri), and one 140,000. For 49 out of 59 truck journeys, the trucks had paid 2006. carry over to consumers in the form of increased prices. Figure 1 shows the average level of payments over time for include reducing the overweight fees trucks must pay at weigh monthly fees of between Rp. 25,000-30,000. changed the ways in which they collect fees. Increasingly to the military police. Fees are paid in Banda Aceh, but the trucks traveling to and from Banda Aceh, including fees paid at stations, protection to trucks from robbery, and accident trucks do not stop at security posts but, instead, are waved convoy usually starts in Lhokseumawe or Langsa. For those The data shows steep declines in illegal levies at security In order to better quantify and assess the amount truck security posts, weigh stations, convoy fees and facilitation protection. The legal status of many of these firms is down and pulled over at different points on the road, with Levels of Illegal Road Payments in Aceh and North Sumatra Trucks carrying different goods pay different fees. As can be seen expenses. The line shows the trend, while each dot point trucks joining convoys, the costs are quite substantial Ð about from Table 3, on-road fees at weigh stations and posts are highest posts associated with the pull-out of military troops and drivers have to pay in bribes and other illegal fees, BRR uncertain. attempts made to make pungli (extortion) less visible. shows the amount paid for an individual journey. The level has Rp. 500,000 per trip on average (see Table 2). Most on-road fees are paid in North Sumatra. The average for trucks carrying agricultural produce or food (at Rp. 284,667 police forces as part of the Helsinki peace agreement. For and the World Bank started monitoring these payments. and Rp. 276,633, respectively). Trucks carrying scrap metal pay dropped, but remains high; even in the last week, one truck Payments at Posts Payments at Weigh Stations amount paid in Aceh at posts and weigh stations is Rp. 39,076; in trips in to Aceh, the amount paid at these posts fell from Data was collected by direct observation Ð surveyors paid over Rp. 500,000 on fees. Table 2: Different Convoy Fees on Banda Aceh-Medan route North Sumatra, the average is Rp. 146,899. Almost all of the less than one-third this amount. However, if convoy fees are Rp. 242,500 to Rp. 50,666. However, illegal payments at accompanied truck drivers on their regular routes from payments in Aceh come after Lhokseumawe as trucks drive included the amount paid for transporting scrap far outweighs the weigh stations by overweight trucks have risen, overtaking Banda Aceh to Medan and back from early November There has been a marked drop in the number of posts at Payments at weigh stations have overtaken those at posts as southwards. The larger part of the difference between Aceh and cost of other goods. Figure 1: Illegal Payments (Posts, Weigh Stations, Convoy Fees which trucks need to pay fees. As a result, there has been a the largest illegal charges for truck drivers on the Medan- # Journeys in Average per posts as the biggest source of on-road payment. DLLAJ 2005 until late February 2006. In total, information was and Facilitation) Paid To North Sumatra is accounted for by differences in fees at weigh (Provincial Land Transportation Agency) staff appear to be collected on 59 truck journeys, 27 from Medan to Banda steep decline in the amount truckers pay at posts. On trips to Banda Aceh road. Figure 4 shows the payments at weigh Convoy Journey (Rp.) stations. At the Seumadam station in Tamiang, Aceh, trucks paid Table 3: Cost of Goods Carried By Trucks In and Out of Aceh Aceh, the average number of posts declined from 28 (in early complicit. Aceh, and 32 from Banda Aceh to Medan. On each stations over time, for trucks coming to and from Aceh. An Brimob 8 518,750 Rp. 15,898 on average; in the Gebang station in North Sumatra, November) to 17 (end of February). The average total paid at initial reduction in payments gave way to a marked rise in average payment is Rp. 91,864. Good Carried # Journeys Average cost per trip Average cost per trip journey, surveyors noted each payment that truck drivers such posts has declined from Rp. 242,500 to Rp. 50,666 (see (excluding convoy (including Trucks also pay convoy fees in Banda Aceh and had to make, the amount paid, to who, where the payment early 2006. The drop in the last two weeks of data collection Preman 6 475,000 fees) Ð Rp. convoy fees) Ð Rp. Figure 2). does not appear to be representative of overall trends, as it is As can be seen in Figure 5, on-road payments have reduced in ‘facilitation’ fees to organizations in Medan to bring down was made (down to the sub-district level), as well as being driven by only two journeys which were given tilangs Polri 1 400,000 both Aceh and North Sumatra, but they are still higher in the latter. Scrap metal 21 93,666 424,619 on-road costs and to provide security services. Convoy information on the characteristics of the truck (e.g. goods Agricultural produce 3 284,667 284,667 Figure 2: Amount Paid at Posts - Trips to Banda Aceh from rather than paying bribes. TNI 1 500,000 Food 15 276,633 276,633 fees average almost Rp. 500,000 for each truck that pays carried, type of truck), and about the journey (e.g. time the Medan Figure 5: Road Payments (Posts and Weigh Stations) Banda Public Disclosure Authorized Manufactured goods 34 195,838 251,681 them Ð normally those carrying goods of questionable trip was undertaken and when fees were paid). Data was Figure 4: Payments at Weigh Stations on Banda Aceh-Medan Aceh - Medan Ð Provincial Split Medicine 1 154,000 154,000 legality. Trucks traveling to Banda Aceh normally pay fees also collected on the extra sums paid for convoy services Road to at least one of five organizations that reduce prices paid and to organizations in Medan that help ‘facilitate’ lower on- at weigh stations and provide other services. road payments and who provide security services. Payments to ‘Facilitation’ Agencies Conclusions Together, the data collected allows for the monitoring of Bringing down these costs, and ensuring that fees levied extortion trends and analysis of its nature. Whereas trucks leaving Aceh sometimes pay convoy fees, Illegal payments remain a significant cost to business and those leaving Medan for Aceh often engage the help of reconstruction in Aceh. After four months of monitoring, the data are legal and paid into state coffers, must be a priority. Illegal Payments by Truckers in Aceh ‘facilitation’ agencies. These organization reduce the bribes shows a significant decline in illegal levies along the Banda Aceh- paid while on the road, and help provide security for trucks. Medan road, associated with the pull-out of troops and police Background and Methods Since the monitoring began in early November 2005, there We refer to the five most prominent organizations covering the mandated by the Helsinki peace agreement. However, bribes Banda Aceh-Medan road as Organizations Satu, Dua, Tiga, paid to state officials at weigh stations have risen as have fees Bribes and illegal fees that truck drivers have to pay to has been a significant decrease in illegal on-road Empat and Lima (or one to five in Indonesian; the names of paid to organizations in Medan for various ‘on-road’ services. corrupt police, military, state officials and preman (criminal) payments on the Banda Aceh-Medan road. However, other Convoy fees also remain high. these organizations have been changed). All are based in groups are a major cost to doing business in Aceh. During fees, such as for convoy protection and ‘facilitation’ costs Medan, all fees are paid there, and the organizations do not the years of conflict in Aceh, security personnel took have not fallen and, together, on-road and off-road illegal 1 It should be noted that the sample of truck journeys is not necessarily representative. We Bringing down the costs of these illegal payments must be a tried to pick a roughly random sample of drivers and firms, but the relatively limited number of appear to have legal status. Each organization works priority. This will require impartial monitoring of security posts and advantage of the unrest to exact charges from truck drivers payments remain a significant cost to doing business in journeys undertaken means that certain forms of goods (such as timber) were under- separately without any cooperation between them. and others driving the roads of Aceh. In areas they Aceh. represented. weigh stations, checking trucks accompanied by convoys to 2 On-road payments include fees at security posts and weigh stations. Off-road fees include ensure the goods they are carrying are legal and to discourage controlled, the Free Aceh Movement (GAM) charged payments for convoy services and to ‘facilitation’ agencies. Each is explored in detail below. 5 If trucks are members of organizations like Organization Satu (discussed below), fees are illegal payments, and investigating organizations in Medan who similar levies. The martial law period from May 2003 gave The decrease in on-road payments Ð at security posts and 3The figures are not strictly comparable because the March total is based on interviews with truck drivers (and hence relies on the accuracy of their recall of sums paid), whereas the lower. If the trucks are members of Organization Satu they pay Rp. 50,000-70,000, however 7 are colluding with corrupt state officials. security forces increased powers and extortion soared with weigh stations Ð appears to be a continuation of a trend Trucks often carried more than one kind of cargo, hence the numbers add up to over 100%. November total is based on direct observation. However, interviews conducted with truck much overweight they are. If they are member of Organization Tiga or Organization Empat, journeys, and hence the goods coming in to and out of Aceh on the trucks in our sample may few checks on the actions of some local actors. from earlier in 2005. Interviews with truck drivers in March drivers in February 2006 show that the interview data is broadly accurate, as reported rates they pay Rp. 10,000 per ton overweight Ð although drivers also have room to bargain. The not be representative of all goods flowing in and out of the province were similar to those recorded by direct observation in the same period. names of these organizations have been changed.

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BANK DUNIA THE WORLD BANK BANK DUNIA THE WORLD BANK BANK DUNIA THE WORLD BANK BANK DUNIA THE WORLD BANK Organization Satu is a trucking firm that has branched out into The number of posts where trucks have to stop to pay bribes in Trucking and Illegal Payments in Aceh 2005 showed average costs of Rp. 650,000. For the two On the route to Banda Aceh, there was an initial rapid drop As can be seen in Figure 3, the number of TNI (military) posts Two weigh stations exist on the Banda Aceh-Medan road: one offering services for other trucks such as ‘facilitation’ at weigh each province is similar, with an average of 5.7 in Aceh and 7.8 in weeks beginning November 4th, when monitoring started, between early November and mid-December, before where fees are charged reduced from 7 to 2 over the course of in Gebang, Langkat district, North Sumatra; the other in stations. Members of Organization Satu are usually trucks that North Sumatra. However, more than double the amount is paid at average payments on the road were Rp. 388,750. More payments started to climb again to an average of Rp. 397,400 the monitoring. Brimob (Brigade mobil Ð paramilitary police) Seumadam, Aceh Tamiang district, in Aceh. The are massively overweight. In order to use the service, trucks are North Sumatran posts than Acehnese ones: Rp. 57,703 on recent interviews with truck drivers indicate that illegal for the two-week period beginning January 27th. There was a posts have by and large disappeared. Posts that remain are characteristics of illegal payments are different at each. required to pay around Rp. 100,000 for each journey before average in North Sumatra, compared to Rp. 23,178 in Aceh. payments fell over the course of 2005 due to a number of sharp decline in payments at the end (fees averaged only Rp. most likely to be manned by regular police forces. Indeed, departure. Facilitation includes a decrease in overweight fines to factors including the pull-out of military troops and police as 134,000 for the two-week period starting February 20th) but after an initial drop-off in the number of police posts, there has When trucks stop at the Gebang weigh station, they Rp. 50,000-70,000 at the Gebang station (Organization Satu only The recent steep drop in payments in North Sumatra appears to part of the Helsinki peace agreement and the arrival of the this appears to be an anomaly and the average is based on a been a rise in the last month. Police personnel are starting to commonly pass bribes to DLLAJ officials working the station. covers North Sumatra), regardless of weight. There appears to be relate to efforts on the part of the provincial police chief to clamp Aceh Monitoring Mission (AMM). limited number of truck journeys. occupy many of the posts left vacant by military and Brimob Until recently, provincial law 7/2002 governed fees at weigh collusion between Organization Satu and the local DLLAJ down on roadside pungli (extortion). In late January, a widely who have departed as part of the peace process. workers, with revenue generated shared between the two. publicized statement was made about efforts to get rid of illegal stations in North Sumatra, with trucks meant to pay Rp. fees, and this appears to have lowered on-road payments. Table 1 shows the average illegal on-road payments on the On the route from Banda Aceh to Medan, fees increased 50,000 per ton they were overweight directly to DLLAJ Organization Dua, which is organized by a preman (criminal) However, continued monitoring will be needed to see if this trend Banda Aceh-Medan road Ð at posts and weigh stations Ð for through November to a high of Rp. 657,000 for the December Figure 3: Numbers of Posts (TNI, Brimob, Police) Ð Trips to officials. In November 2005, this law was superceded by group, provides security and insurance against theft from trucks. holds. trips into Aceh, trips from Aceh, and the average across all 12th-15th period. They fell off in December, but have started Banda Aceh from Medan national legislation that says that drivers should not pay any It covers many trucking routes over Sumatra, with its Medan- trips. to climb again. For the final two-week period, combined fees fees at stations, with overweight trucks having a court hearing Banda Aceh operation opening in early 2005. Each route is run Different Costs for Different Goods averaged Rp. 390,000 per truck, higher than the November instead. However, the old system still operates, except that by a division, with each division having a large degree of Table 1: Average On-Road Illegal Payments (Posts and Weigh total. the common fee is Rp. 20,000 per overweight ton. Common autonomy over price setting and its operations. Most trucks are A variety of goods were carried on the monitored trucks going in Stations) on the Banda Aceh-Medan road by Time Period practice is for drivers to hand over their papers, with money members of Organization Dua. All Organization Dua members and out of Aceh. Figure 6 shows the percentage of trucks Forms of Illegal Payments hidden inside. None of this money goes into the state coffers. are required to pay a registration fee of Rp. 120,000 and a carrying different loads for each direction. For trucks driving in to 2 week Both directions To Aceh From Aceh Rates of payment at the Gebang station stayed high over the monthly fee of Rp. 25,000. Trucks that do not pay Organization Aceh, 75% carried household goods, 35% food (ingredients and period Average # Trips Average # Trips Average # Trips There are a number of forms of illegal payments. course of the monitoring, although rates of issuance of official Dua money often experience ‘theft’ on the road. prepared), 28% construction material, 25% drinks and 16% scrap starting Cost (Rp.) Observed Cost (Rp.) Observed Cost (Rp.) Observed tilangs also increased during the period under observation. mental. For trucks leaving Aceh, 59% were carrying scrap metal, 4th Nov 388,750 4 497,500 2 280,000 2 Police and Military Posts. Along the Banda Aceh-Medan Organization Tiga used to help facilitate trucks crossing the North 30% plastic goods and 22% empty bottles. 18thNov 177,000 8 232,750 4 121,250 4 road, the police and military run roadside posts. Drivers are In contrast, it is harder to pay bribes at the Seumadam station Sumatra-Aceh border. Before the pull-out of troops associated 2nd Dec 123,400 5 198,000 2 73,667 3 requested to stop at these and to pay a fee, normally in cash in Aceh, and the bribes that are paid are substantially smaller with the peace agreement, drivers would have to pay massive Figure 6: Goods Carried By Trucks In and Out of Aceh on Banda 16thDec 159,944 9 197,100 5 113,500 4 but sometimes in the form of drinks such as Krating Daeng (a than at Gembang. In Seumadam, truck drivers stop before fees at the border and were often subject to harassment and Aceh - Medan Road 30thDec 147,833 9 322,625 4 8,000 5 popular energy drink) as well. they reach the weigh station and walk the last few hundred violence. As the troops left, Organization Tiga has tried to change th its role to offer a combination of the weigh station and security 13 Jan 212,333 9 263,571 7 33,000 2 meters to tell DLLAJ officials that the truck is overweight and th Weigh Stations. The DLLAJ (Provincial Land Transportation services provided Organization Satu and Organization Dua. 0.8 27 Jan 222,100 10 357,400 5 86,800 5 to begin the process of bargaining for the fee to be paid. After th Agency) runs two weigh stations on the Banda Aceh-Medan Members are required to pay a registration fee of Rp. 100,000 and 0.7 Bribes and illegal payments that truck drivers pay on the As Aceh opened up after the tsunami, such fees 20 Feb 96,400 5 67,333 3 140,000 2 paying the agreed amount, the driver brings the truck into the a monthly fee of Rp. 55,000. Members pay Rp. 10,000 per Banda Aceh - Medan road constitute a major cost to doing constituted a significant tax on the reconstruction and route. The stations are meant to weigh trucks to prevent them station for formality purposes only. Since mid-February, pungli 0.6 from carrying overweight cargos. According to national overweight ton at the weigh stations. Where accidents occur, business in Aceh. On average, trucks traveling to Banda recovery effort. Interviews with truck drivers conducted by The costs of on-road payments are significantly higher for (extortion) has started to decrease with more overweight Organization Tiga assists in handling documentation. 0.5 Aceh from Medan pay Rp. 321,000 in bribes, extortion and the World Bank in March 2005 revealed that trucks going legislation, trucks that are overweight are supposed to be tickets issued. However, the process depends on which shift trucks coming in to Aceh from Medan than for those leaving issued an official citation (surat tilang). They must 0.4 other illegal fees. Those traveling in the other direction from Banda Aceh to Medan were asked to pay bribes at Aceh. On average, trucks headed for Banda Aceh pay Rp. is working. While some officials will now not take bribes, Organization Empat provides similar services at weigh stations, subsequently appear in court and pay a fine determined by a There has been a gradual decline in the amount paid at each 0.3 average Rp. 366,296. These costs have a substantial between 70 and 110 different posts during a single trip. At 236,500 while those leaving Aceh pay Rp. 94,074. others are happy to do so. with members also paying Rp. 10,000 per overweight ton. Percentage judge. Instead, however, those at the weight station often post for trips in to Aceh. For the November 4th-17th period, 0.2 impact on tsunami reconstruction and are carried over to each post, the truck driver was required to give some form Monthly fees are Rp. 50,000 for this service. All members have a consumers in the form of increased prices. of illegal payment, ranging from a few thousand Rupiah, to accept payments on the spot, and take bribes to reduce the drivers paid on average Rp. 8,800 per post when they were Convoy Fees sign in the center of their windshield with the Organization Empat 0.1 However, if convoy fees and other ‘facilitation’ fees (see below) amounts paid. stopped. This stayed fairly constant until January 27th, when a pack of cigarettes, to as much as Rp. 100,000. While in are included, costs are higher in both directions. Including logo. Some also bear the inscription of a military command unit. 0 the average fee fell below Rp. 6,000, and for the last two-week Only trucks leaving Aceh pay convoy fees. Trucks that are HouseholdConstruction....Drinks goodsEmptyFood bottlesPrepared ingredientsSteel FurniturefoodCars/motorcyclesElectronicsPlasticMedicines goodsChemicalsSandPlastic Goods In order to quantify and assess the amount truck drivers many cases the individual fees collected at each post were convoy fees Ð which are only charged for trucks leaving Aceh Convoy Fees. Some trucks traveling from Banda Aceh to period, drivers paid just under Rp. 3,000 per post. For trips carrying goods such as scrap metal, plastics and bottles pay Organization Lima helps trucks who are in traffic accidents. have to pay, BRR and the World Bank started monitoring small, total amounts were high. Trucks heading to Banda Ð brings the cost of exporting goods from Aceh on journeys to Medan pay convoy fees to the military police. Trucks who pay out of Aceh, fees paid at posts fell earlier; average amounts Fewer trucks use this service. payments beginning in early November 2005. Data was Aceh from Medan carrying consumer goods paid an Medan to Rp. 366,296. Including ‘facilitation’ fees Ð which are these fees. To transport such goods, it is necessary to get these fees are usually carrying goods of dubious legality, per post dropped to under Rp. 2,000 at the end of 2005, and official documentation. To save on time, and to avoid collected by direct observation with surveyors average of Rp. 650,000 in illegal payments per trip. While charged in Medan Ð brings the average cost for trucks including scrap metal. have remained under Rp. 3,000. These fees Ð particularly the per-journey fees Ð constitute a accompanying truck drivers on their regular journeys from humanitarian aid was exempt, other goods needed for traveling to Banda Aceh to Rp. 321,000. These extra costs are government inspection, trucks pay fees to be accompanied by a convoy. 16 of the 27 trucks in our sample traveling from Aceh significant tax on trucking. For 13 of the 59 truck journeys, trucks Banda Aceh to Medan and back. Overall, 59 journeys reconstruction were not. These illegal payments not only having an impact on the tsunami reconstruction process. ‘Facilitation’ Agencies. A number of organizations provide With the presence of the AMM and international tsunami paid facilitation fees (normally to Organization Satu) averaging Rp. were surveyed from November 2005 through February have an impact on truck drivers and firms, but the costs to Medan (59%) paid convoy fees: eight paid fees to Brimob, To Aceh From Aceh various ‘services’ to trucks who pay them fees. Services reconstruction NGOs, security personnel have, in many cases, six to preman groups, one to the regular police (polri), and one 140,000. For 49 out of 59 truck journeys, the trucks had paid 2006. carry over to consumers in the form of increased prices. Figure 1 shows the average level of payments over time for include reducing the overweight fees trucks must pay at weigh monthly fees of between Rp. 25,000-30,000. changed the ways in which they collect fees. Increasingly to the military police. Fees are paid in Banda Aceh, but the trucks traveling to and from Banda Aceh, including fees paid at stations, protection to trucks from robbery, and accident trucks do not stop at security posts but, instead, are waved convoy usually starts in Lhokseumawe or Langsa. For those The data shows steep declines in illegal levies at security In order to better quantify and assess the amount truck security posts, weigh stations, convoy fees and facilitation protection. The legal status of many of these firms is down and pulled over at different points on the road, with Levels of Illegal Road Payments in Aceh and North Sumatra Trucks carrying different goods pay different fees. As can be seen expenses. The line shows the trend, while each dot point trucks joining convoys, the costs are quite substantial Ð about from Table 3, on-road fees at weigh stations and posts are highest posts associated with the pull-out of military troops and drivers have to pay in bribes and other illegal fees, BRR uncertain. attempts made to make pungli (extortion) less visible. shows the amount paid for an individual journey. The level has Rp. 500,000 per trip on average (see Table 2). Most on-road fees are paid in North Sumatra. The average for trucks carrying agricultural produce or food (at Rp. 284,667 police forces as part of the Helsinki peace agreement. For and the World Bank started monitoring these payments. and Rp. 276,633, respectively). Trucks carrying scrap metal pay dropped, but remains high; even in the last week, one truck Payments at Posts Payments at Weigh Stations amount paid in Aceh at posts and weigh stations is Rp. 39,076; in trips in to Aceh, the amount paid at these posts fell from Data was collected by direct observation Ð surveyors paid over Rp. 500,000 on fees. Table 2: Different Convoy Fees on Banda Aceh-Medan route North Sumatra, the average is Rp. 146,899. Almost all of the less than one-third this amount. However, if convoy fees are Rp. 242,500 to Rp. 50,666. However, illegal payments at accompanied truck drivers on their regular routes from payments in Aceh come after Lhokseumawe as trucks drive included the amount paid for transporting scrap far outweighs the weigh stations by overweight trucks have risen, overtaking Banda Aceh to Medan and back from early November There has been a marked drop in the number of posts at Payments at weigh stations have overtaken those at posts as southwards. The larger part of the difference between Aceh and cost of other goods. Figure 1: Illegal Payments (Posts, Weigh Stations, Convoy Fees which trucks need to pay fees. As a result, there has been a the largest illegal charges for truck drivers on the Medan- # Journeys in Average per posts as the biggest source of on-road payment. DLLAJ 2005 until late February 2006. In total, information was and Facilitation) Paid To North Sumatra is accounted for by differences in fees at weigh (Provincial Land Transportation Agency) staff appear to be collected on 59 truck journeys, 27 from Medan to Banda steep decline in the amount truckers pay at posts. On trips to Banda Aceh road. Figure 4 shows the payments at weigh Convoy Journey (Rp.) stations. At the Seumadam station in Tamiang, Aceh, trucks paid Table 3: Cost of Goods Carried By Trucks In and Out of Aceh Aceh, the average number of posts declined from 28 (in early complicit. Aceh, and 32 from Banda Aceh to Medan. On each stations over time, for trucks coming to and from Aceh. An Brimob 8 518,750 Rp. 15,898 on average; in the Gebang station in North Sumatra, November) to 17 (end of February). The average total paid at initial reduction in payments gave way to a marked rise in average payment is Rp. 91,864. Good Carried # Journeys Average cost per trip Average cost per trip journey, surveyors noted each payment that truck drivers such posts has declined from Rp. 242,500 to Rp. 50,666 (see (excluding convoy (including Trucks also pay convoy fees in Banda Aceh and had to make, the amount paid, to who, where the payment early 2006. The drop in the last two weeks of data collection Preman 6 475,000 fees) Ð Rp. convoy fees) Ð Rp. Figure 2). does not appear to be representative of overall trends, as it is As can be seen in Figure 5, on-road payments have reduced in ‘facilitation’ fees to organizations in Medan to bring down was made (down to the sub-district level), as well as being driven by only two journeys which were given tilangs Polri 1 400,000 both Aceh and North Sumatra, but they are still higher in the latter. Scrap metal 21 93,666 424,619 on-road costs and to provide security services. Convoy information on the characteristics of the truck (e.g. goods Agricultural produce 3 284,667 284,667 Figure 2: Amount Paid at Posts - Trips to Banda Aceh from rather than paying bribes. TNI 1 500,000 Food 15 276,633 276,633 fees average almost Rp. 500,000 for each truck that pays carried, type of truck), and about the journey (e.g. time the Medan Figure 5: Road Payments (Posts and Weigh Stations) Banda Manufactured goods 34 195,838 251,681 them Ð normally those carrying goods of questionable trip was undertaken and when fees were paid). Data was Figure 4: Payments at Weigh Stations on Banda Aceh-Medan Aceh - Medan Ð Provincial Split Medicine 1 154,000 154,000 legality. Trucks traveling to Banda Aceh normally pay fees also collected on the extra sums paid for convoy services Road to at least one of five organizations that reduce prices paid and to organizations in Medan that help ‘facilitate’ lower on- at weigh stations and provide other services. road payments and who provide security services. Payments to ‘Facilitation’ Agencies Conclusions Together, the data collected allows for the monitoring of Bringing down these costs, and ensuring that fees levied extortion trends and analysis of its nature. Whereas trucks leaving Aceh sometimes pay convoy fees, Illegal payments remain a significant cost to business and those leaving Medan for Aceh often engage the help of reconstruction in Aceh. After four months of monitoring, the data are legal and paid into state coffers, must be a priority. Illegal Payments by Truckers in Aceh ‘facilitation’ agencies. These organization reduce the bribes shows a significant decline in illegal levies along the Banda Aceh- paid while on the road, and help provide security for trucks. Medan road, associated with the pull-out of troops and police Background and Methods Since the monitoring began in early November 2005, there We refer to the five most prominent organizations covering the mandated by the Helsinki peace agreement. However, bribes Banda Aceh-Medan road as Organizations Satu, Dua, Tiga, paid to state officials at weigh stations have risen as have fees Bribes and illegal fees that truck drivers have to pay to has been a significant decrease in illegal on-road Empat and Lima (or one to five in Indonesian; the names of paid to organizations in Medan for various ‘on-road’ services. corrupt police, military, state officials and preman (criminal) payments on the Banda Aceh-Medan road. However, other Convoy fees also remain high. these organizations have been changed). All are based in groups are a major cost to doing business in Aceh. During fees, such as for convoy protection and ‘facilitation’ costs Medan, all fees are paid there, and the organizations do not the years of conflict in Aceh, security personnel took have not fallen and, together, on-road and off-road illegal 1 It should be noted that the sample of truck journeys is not necessarily representative. We Bringing down the costs of these illegal payments must be a tried to pick a roughly random sample of drivers and firms, but the relatively limited number of appear to have legal status. Each organization works priority. This will require impartial monitoring of security posts and advantage of the unrest to exact charges from truck drivers payments remain a significant cost to doing business in journeys undertaken means that certain forms of goods (such as timber) were under- separately without any cooperation between them. and others driving the roads of Aceh. In areas they Aceh. represented. weigh stations, checking trucks accompanied by convoys to 2 On-road payments include fees at security posts and weigh stations. Off-road fees include ensure the goods they are carrying are legal and to discourage controlled, the Free Aceh Movement (GAM) charged payments for convoy services and to ‘facilitation’ agencies. Each is explored in detail below. 5 If trucks are members of organizations like Organization Satu (discussed below), fees are illegal payments, and investigating organizations in Medan who similar levies. The martial law period from May 2003 gave The decrease in on-road payments Ð at security posts and 3The figures are not strictly comparable because the March total is based on interviews with truck drivers (and hence relies on the accuracy of their recall of sums paid), whereas the lower. If the trucks are members of Organization Satu they pay Rp. 50,000-70,000, however 7 are colluding with corrupt state officials. security forces increased powers and extortion soared with weigh stations Ð appears to be a continuation of a trend Trucks often carried more than one kind of cargo, hence the numbers add up to over 100%. November total is based on direct observation. However, interviews conducted with truck much overweight they are. If they are member of Organization Tiga or Organization Empat, journeys, and hence the goods coming in to and out of Aceh on the trucks in our sample may few checks on the actions of some local actors. from earlier in 2005. Interviews with truck drivers in March drivers in February 2006 show that the interview data is broadly accurate, as reported rates they pay Rp. 10,000 per ton overweight Ð although drivers also have room to bargain. The not be representative of all goods flowing in and out of the province were similar to those recorded by direct observation in the same period. names of these organizations have been changed.

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