Draft Regulation of Job Creation Law Expected Become a Way Out for Smallholder’s Oil Palm Plantation Legality
Oil palm smallholder farmers are one of the most important actors in the national palm oil industry mega-sector. Their share reaches 41 percent of the total area of oil palm plantations in India. The number of smallholder farmers also reaches 2.6 million people. This shows that oil palm plantations are the basis of a communities economy that has been proven to create inclusive social-economic benefits such as increasing income and welfare, so that they are able to become the locomotive for regional economy and contribute to national economic development.
However, beyond contributions they have made, the smallholder farmers have to face problems that continue to shackle and threaten their existence, namely the legality status of plantations that are claimed in forest areas. This problem is faced by millions of independent farmers who have independently developed oil palm plantations since decades ago.
Rural communities who become oil palm farmers have become a unitary ecosystem with the forest and they do not know the boundaries of forest areas, so they consider the surrounding forests has belong to rural/customary communities, one of which can be used for oil palm plantations. However, along with spatial planning and forest use policies that often changing, the land is claimed as a forest area so that farmer’s plantations are considered illegal.
APKASINDO data shows that around 3.2 million hectares of farmer’s plantations are claimed to be in forest areas or the area of about 48 percent of total area of oil palm farmer’s plantations. This causes them difficulty to access various sources of capital/credit and participate in palm oil development programs such as PSR (replanting) and ISPO. This legality problem is still being used by local “unscrupulous” to exploit farmers for discount their FFB’s price. In addition, this is also often “fried” by anti-palm oil parties to spreading a black campaign attacking the palm oil industry. Therefore, it is necessary to immediately look for policy formulations that can be implemented to solve that problem.
The issuance of the Job Creation Law as an “omnibus” for simplifying regulations with the aims of easing the investment and creating job opportunities, so that it is hoped that it will be a solution and bring convenience to economic actors, including solving the smallholder farmer’s plantations from the problem of claiming forest area status. However, the spirit of the Job Creation Law is considered to contradict with the derivative product of the Draft Government Regulation (RPP) related to the certainty settlement of smallholder farmer’s oil palm plantation in the forestry and plantation sector, because it is considered burdens farmers.
APKASINDO has raised several points of objection to draft regulation. They are related to the settlement of claims on farmer’s plantations with a maximum area of 5 hectares in forest area that has been detemined, and the farmers are required to have a business license related to their location and business field.
This shows that draft regulation has closed opportunities for farmers who have oil palm plantations with an area of 6-25 hectares to obtain the release of forest areas. The draft regulation also contradicts Law no. 39/2014 concerning Plantation, which categorizes the farmer’s plantation area as less or equal to 25 hectares.
In addition, the enactment of the draft regulation requires the government to identify and verify the fulfillment of oil palm plantation, so that it will have an impact on costs, long time and also have the potential to attract transaction practices that are detrimental to smallholders. In fact, the settlement of farmer’s problem related claim in forest area must be immdediately.
The next point regarding settlement claims of oil palm plantations in forest areas will only be resolved if the forest area has gone through a designation process. In fact, many oil palm plantations are claimed to be in forest areas, but the forest status of has not yet reached the stage of determining forest areas. Indonesian Forestry Scholar Association (Persaki) Expert Council, DR. Petrus Gunarso, also questioned what percentage of forests in Indonesia had actually been confirmed and declared as permanent forests.
In the draft regulation is also a requirement for farmers to have business permits which are limited to location permits and business permits in the plantation sector. In fact, so far, oil palm farmers do not have this permit because it is not required based on previous regulations such as the Plantation Law or the Minister of Agriculture Regulation. Even in rural communities, the social legality of a plantation land is only based on the recognition of the community/neighbors.
Do not let the smallholder famers feel that the Indonesian government has abandoned them because there is no solution to problems that have long shackled them. The governments of other countries and the international community pay attention to the welfare of smallholder oil palm farmers. However, this is in contrast to the government in this country which issued a policy but has not been able to solve the problem of claim farmer’s plantations, in fact this policy is even burdening them.
The Indonesian government should support and defend the interests of smallholder farmers oil palm plantations by creating solutions to their problems. Draft regulation of Job Creation Law should still be hopeful by presenting a solution in the form of a short, easy, and inexpensive settlement mechanism as the philosophy of that law.
The regulation in question is in the form of a policy to exclude existing smallholder farmer oil palm plantations from forest areas and recognizing permit letters/certificates that have been owned by farmers such as Cultivation Registration Certificates (STDB), Customary Rights, Evidence of Planters’ Land Sale and Purchase, and other evidence recognized by the community and local customary law which are issued before the enactment of the Job Creation Law.
By resolving the problem of claims for farmer’s plantations in forest areas so that the legality can be “clean and clear”, it will bring enormous benefits to the development of oil palm plantations in Indonesia. Farmers will have access to capital and market because the legality of their land and business is guaranteed. They also can participate in the replanting program (PSR) and sustainable certification (ISPO). These benefits will lead to an increase in the welfare of oil palm farmers, which will drive the regional and national economies. At the same time also improving the image and prove to anti-palm oil NGOs that oil palm plantations in Indonesia are sustainable.
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