Over the past few weeks there have been occasional news reports about a clash between Indomaret (a local chain of mini-mart) and the administration of Banyumas, a regency in Central Java. While the fate of 19 condemned Indomaret stores in Banyumas might not appear to be of great interest in and of itself, the case is interesting for the light that it throws on relationships between small business owners and public administrators in Indonesia. In particular, the case brings to mind the shady links between Rumah Bahasa (a controversial language school in Jakarta) and DIKNAS, the department tasked with regulating the industry. For anyone wanting to understand how a school like RB can stay in business, the Indomaret Banyumas case will prove quite revealing.

Where Are Your Official Permits?

The case first beeped on the radar about 6 weeks ago, when a story appeared that Banyumas regency was closing down 19 mini-marts which didn’t have the correct permits. At first the regency tried to make it seem very proper, expressing their disapproval and disappointment at these law-breaking renegades, Indomaret. Here is how it was reported in the Jakarta Post on September 20:

A Banyumas regency official has said that his office intends on shutting down 19 Indomaret outlets due to permit violations. The tough decision was made following the stores inability to fulfill certain requirements of their permits.

“We have warned them so many times. In fact, they even dared to ignore our warnings by removing the seals and reopening the stores without our permission,” Banyumas regional secretary Wahyu Budi Saptono said on Saturday.

This regional official here makes it seem as if the fault is entirely with the mini-mart chain. They have violated their permits. They have ignored warnings. They have broken seals. They have have re-opened stores without permission. They really do seem flagrant rule-breakers this Indomaret Banyumas group, don’t they?

But if you think of it, isn’t there something a bit strange about the whole scenario? If this group were so bad, why were they allowed to open 19 different stores? How did they keep getting permits to open new stores if the 15th, 16th and 17th store they opened were so flagrantly violating their permits? At least one comment-writer smelt a rat. He wrote:

Another one who didn’t pay ??????? Very serious violations when you refuse the “help” of officials !!!!! I don’t know what serious offenses these stores had committed in their neighborhoods but looks like KPK, the Corruption Commission, have a huge job but, alas, they are seriously understaffed!

A Twist in the Tale

The instincts of this user, Pauloh, turned out to be excellent. By the following month, the case had taken another interesting turn. It was now alleged that an official in the Banyumas administration had been wired a substantial amount of money by Indomaret to be able to continue operating without the official permits. Here is the Jakarta Post from a month later:

The head of Banyumas Public Order Agency, Rusmiyati, has been dismissed from her current position and transferred to a staff job at the Regional Employment Agency (BKD) following allegations that she accepted bribes from the management of the Indomaret convenience store group. Here is more from the JP:

“Rusmiyati has confessed that she received gratuities from Indomaret. We cannot tolerate this,” Banyumas Regent Achmad Husen said on Tuesday.

Commenting on the case, Indomaret’s lawyer Joko Susanto confirmed that the Indomaret management had wired Rp 100 million (U$ 8,326) to Rusmiyati.

“The money was meant to smooth the procedures for getting the necessary store permits,” he said.
He added that there was a reasonable possibility that Rusmiyati might have received bigger sums apart from the transferred amount.

This lends quite a different look to the whole picture, doesn’t it? “Smooth the procedures for getting the necessary store permits“. In other words, the local administration has been making problems about getting the myriad of different permits you need to start and run a business in Indonesia. Typically these problems can be magically made to disappear if money finds its way into the right hands. While there seems to be no doubt that the head of the Head of the Public Order Agency, Ms. Rusmiyati, was corrupt and taking bribes, the implication is clearly that some of the money would be used for clearing away bureaucratic red tape ie. bribing others.

Therefore, we can infer that the bribes were not all intended for Rusmiyati herself. This view is also supported by the interesting line, “There was a reasonable possibility that Rusmiyati might have received bigger sums apart from the transferred amount“. Also, before we move on, it is amazing yet revealing that Rusmiyati wasn’t fired but merely transferred despite being caught red-handed in a Rp 100 million graft case. What on Earth would an official have to do before she gets fired in Banyumas Regency? Was this non-punishment given because other more senior people were involved? You have to wonder.

Rumah Bahasa and Indomaret Compared

How can these nefarious dealings in Banyumas, Central Java, help us to understand Indonesia’s troubled TEFL industry? What is the link between a chain of mini-marts and a (dramatically shrinking) chain of language schools in Jakarta? Here are the main points of similarity.

1) Both Indomaret and Rumah Bahasa were operating a highly visible business without the proper permits. Indomaret had 19 questionable stores and Rumah Bahasa had high-profile premises right on main roads in Jakarta.

2) In both cases, the government agencies who were supposed to supervise the businesses was mysteriously absent. Rumah Bahasa isn’t even registered as a PT. (public company) and yet it runs large schools right on the main roads of Kelapa Gading and Bintaro. How did Indomaret open and operate 19 stores illegally before the government stepped in and closed them down? Was someone sleeping at their job for years? The only reasonable explanation is that government officials were accepting bribes to turn a blind eye to unauthorized businesses. Rusmiyati was almost certainly not the only person involved in the case of Indomaret, but she is taking the blame and a scandalously light ‘punishment’ as part of a cover-up. In the case of Rumah Bahasa, DIKNAS and Immigration must be turning a blind eye.

3) A third point worth considering is the ‘feigned innocence’ of the authorities. When the Indomaret scandal emerged, authorities pretended to be outraged by the actions of Indomaret. They issued stern reprimands in the press. Yet in truth they must have known for a long time that 19 stores were operating without the right permits, so really they must have been complicit in lax law enforcement for a long time. Similarly, DIKNAS is pretending not to know that there is a rogue school chain called Rumah Bahasa opertaing in Kelapa Gading and Bintaro (it was formerly in Green Bay and Season City too). Yet the school in Kelapa Gading is a mere 400 metres from the North Jakarta Immigration Office. Their innocence is feigned not real. The only reasonable explanation is that their feigned ignorance has been bought.

Conclusion

Therefore, the “Skandal Indomaret Banyumas” (Banyumas Indomaret Scandal) can shed a lot of light on the TEFL industry in Indonesia. It reveals how a school chain like Rumah Bahasa can operate large, highly visible schools without even being registered as a business. It can also help us understand how TBI was get away with employing non-qualified teachers on VKU (business consultant visas) for years. There is a pervasive culture of giving and receiving bribes in the Indonesian bureaucracy as well as the private sector. There is also a whole thicket of red tape associated with starting a business and the process can only be “smoothed” by the paying of bribes. We can only include that Frendy Horas, the owner of the scam-ridden Rumah Bahasa, has his own Rusmiyati or too at DIKNAS and the Immigration Department. Sadly, corruption is pervasive in Indonesia and the TEFL industry is deeply implicated.