TEMPO.CO, Jakarta - The Indonesian Ombudsman identified several governance issues within the oil palm industry, particularly concerning state-provided services. These issues raise concerns of potential maladministration and non-compliance with principles of justice, transparency, and accountability. 

Yeka Hendra Fatika, a member of the Indonesian Ombudsman, highlighted the low achievement of the Cultivation Registration Certificate (STDB) for smallholder palm oil farmers, reaching only 1.54% of 2.5 million farmers.

“How many more years will it take for our smallholder palm oil areas to obtain STDB? The progress in collecting STDB data for palm oil is extremely slow,” Yeka emphasized during the Handover of the Systemic Analysis Study Results Report to 12 relevant institutions on Monday, November 18, 2024.

He attributed this low coverage to budgetary constraints, human resource limitations at the local government level, and overlapping land claims between plantations and forest zones.

Additionally, Yeka mentioned that the Indonesian Sustainable Palm Oil Certificate (ISPO) certification rate is also significantly low, with only 35.67% of the total 16.38 million hectares of plantation area certified. For smallholder farmers, the rate is even lower, at 0.86% of the 6.94 million hectares.

Yeka cited inadequate certification services, the ineffectiveness of the ISPO Committee, and unclear policy support for certification funding as the primary reasons for this low rate.

“The low achievement in STDB data collection and ISPO certification indicates a potential for maladministration, stemming from neglect of legal obligations and failure to provide adequate services,” Yeka emphasized.

Further, the uncertainty surrounding the Technical Approval Service (TAS) for the Utilization of Palm Oil Mill Wastewater to Land Applications (LA-POMLW) poses another challenge. The absence of clear guidelines for preparing LA-POMLW Technical Studies, particularly regarding water quality standards and emission limits, hinders the process.

Yeka warned that this potential maladministration could negatively impact the productivity of Fresh Fruit Bunches (FFB), which currently averages 12.8 tons per hectare in Indonesia. In contrast, Malaysian palm oil companies with 95% MSPO certification have achieved a higher productivity level of 19 tons per hectare.

“There's a productivity gap of approximately 6.2 tons per hectare of FFB,” he noted.

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