Part 3 – Halal For Cash

Part 3 – Halal for Cash

Indonesia has a population of around 237 million people. It has the largest number of Muslims of any country in the world and is home to 13% of the world’s entire Muslim population. It also happens to be our nearest neighbour and a lucrative export market.

In Australia, halal red meat production for export is governed by the Australian Government Muslim Slaughter Program (AGMS). The AGMS is underpinned by legislation through the Australian Quarantine and Inspection Service (AQIS).

AQIS introduced the AGMS program in 1983 to regulate the production of halal meat and meat products. The AGMS is controlled by legal requirements in the Export Control (Meat and Meat Products) Orders under the Export Control Act of 1982, and applies to red meat, offal and meat products.

If you want to call food halal in Indonesia, then labelling is mandatory.

The ‘pig scare’* crisis in Indonesia in 1989 led to the formation of the nation’s halal certification authority; the Majelis Ulama Indonesia (MUI) or the Indonesian Clerics Council which enforces the Republic of Indonesia’s health and labelling Acts.

(*Pork was detected in meatballs from thirty nine different meatball shops in the Surabaya and Yogyakarta region.)

In Australia halal certifiers have needed to seek approval from the MUI for the licensing rights to halal certify for exports into the Indonesian market.

In 2006, the MUI was caught up in an Australian corruption scandal dubbed by the Indonesian media as, ‘Halal for Cash’.

Australian halal certifier, Mohamed El Mouelhy, (there’s that name again) made allegations of corruption against the then Chairman of the MUI, Amidhan Shanerah.

Several Australian certifiers paid a total of $28,000 personally to Shanerah for travel expenses to and from Australia. El Mouelhy contributed $4,000.

Shanerah denied that the Australian certifiers had funded the trip. He claimed that the State (Indonesia) paid for the trip. The allegations claimed Shanerah pocketed the funds paid to him personally by the Australian certifiers.

Following Shanerah’s junket to Australia, all the “donating” certifiers were approved, except Mr El-Mouelhy who was refused certification because he was unqualified, being neither an Islamic law expert nor a food scientist. He remains unaccredited and unable to certify halal in Indonesia.

Subsequent to the corruption allegations, changes were made to halal certification in Indonesia.

It’s reasonable to ask if Mr El Mouelhy would have made such a fuss had he received his halal certification accreditation.

Following this public corruption scandal, the Indonesian government introduced a bill on halal certification so as to transfer the halal certification authority from the MUI to a new, independent body. It was claimed this was done for the protection of Indonesian consumers.

The Religious Affairs Minister Suryadharma Ali said that taking over the authority to issue halal certification from the MUI was part of an effort to “uphold the principle of fairness”.

He said, “Other Islamic organisations will be jealous and will demand the same role. Besides, it is the government that has the mandate to issue a regulation, not a mass organisation.”

The Minister proposed, in a new arrangement for halal certification, that the MUI could still be involved in providing recommendations but only from a “religious perspective”.

Suryadharma Ali, who is the chair of the Islamic-based United Development Party (PPP), said that by eliminating the role of the MUI, the government could also reap additional tax revenues from the issuance of halal certificates.

Under the current arrangement, the MUI gets to keep all proceeds derived from the issuance of the certificates. The MUI charges 5 million rupiah (approx $400) for a halal certificate.

Tasked with deliberating the bill, Lawmaker Hasrul Azwar, a member of the House Commission overseeing religious and social affairs, said the MUI had never been transparent about what it earned from halal certification.

Hasrul Azwar, also a PPP politician, said that once the government had control of the halal certification process it would not only reap more revenue for the state but could also help curb extortionate practices. “We plan to break down the components of costs involved in the issuance of each certificate to prevent businesses from being charged illegal levies. We have to control it”, he said.

The draft bill also proposes the establishment of an independent halal-certification body, which is currently being formed.

Australia, however, still has no regulation of the halal certification ‘industry’. Unqualified Muslims are allowed to proliferate and prosper at the expense of mostly non-Islamic consumers.

Indonesia with 210 million Muslims, 85% of the population, has one government appointed halal certifying body. Australia with 500,000 Muslims, 2.2% of the population, has 33 listed halal certifiers.

And the government appoints not a single one of them!

Halal certification in Australia is entirely unregulated and runs rampant through our consumer markets.

After eight years of dispute with the MUI, the Indonesian government has only just reached an agreement with it to finalise legislation for an independent consumer-based body to regulate halal certification.

In contrast, Australia’s halal certifiers are growing like weeds through our economy, reaping billions at the cost of the consumer and taxpayer, certifying anything and everything that moves, or doesn’t move.

In Indonesia, the MUI will continue to halal certify until 2018 at which time it will hand over to the new body. Part of its submission to government is that it wants halal certification to be mandatory on all foods, goods and pharmaceuticals which is attracting strident opposition from Indonesian consumer and industry bodies. Yet it attracts little attention here.

The Indonesian Association of Food and Beverage Companies is against halal certification saying that applying halal labels is a “heavy burden on industry”.

That same heavy burden is occurring here in Australia.

Indonesia, in respect of out-of-control halal rorting, is strangely well ahead of Australia in tackling the problem. It’s time for Australia to catch up.

CORRUPTION ALLEGATIONS

On 24 February last year, Jakarta’s “Tempo” magazine reported on wide-spread allegations of corruption in halal certification.

Tempo reported: (excerpts)

“Corruption, it seems, knows no bounds of time or place. Even when it comes to halal labels – which guarantee foods contain nothing that is haram, or forbidden for religious reasons – has now become a target for manipulation.

“The certificates should be issued free of charge to avoid causing problems for companies and consumers alike. In practice, however, producers are made to pay for the costs of testing food and drink products, and there is no transparency over the tariffs charged. This has led to an ironic situation: halal certificates are issued through a haram process.

“The MUI works with certification organisations in several nations. And it is here the opportunity for abuses emerges.

“Because of such bribery, the performance of the halal-label issuing companies has never been audited.

“One of the ongoing debates concerns whether certification should be voluntary or obligatory. The Indonesian Association of Food and Beverage Companies is of the view that applying halal labels is a burden on the industry.

“The MUI Food, Drugs and Cosmetics Research Agency has set an administration fee of Rp6 million per product, but in practice there are other costs which are unclear and which can run to tens of millions of rupiah. As a result, not only will consumers pay more, the competitiveness between local products is affected.

“These indications of abuse must be followed up. The MUI must explain where funds from issuing halal certification have gone. This non-government organisation, which gets some funding from the State Budget and which manages public funds from halal certification, must be made more transparent through an audit by the Supreme Audit Agency.

“Far-reaching measures are needed to deal with this problem. The Indonesian Consumers Association once proposed that halal labels be replaced with non-halal certificates. In other words, rather than labelling food as halal, haram food should be separated from halal food.

“This concept is based on the simple assumption that most food in Indonesia is processed according to halal procedures anyway, and uses ingredients that are not haram.

“Products that are not halal, such as those containing pork or alcohol, would have to be labelled accordingly. This method would be more practical, less complicated and infinitely less costly.

“Mohamed El Mouelhy, (he just keeps popping up) so called president of the Sydney-based Halal Certification Authority told Tempo.”It’s common knowledge in Australia that in order to get authorisation you have to bribe MUI officials.” (end excerpts)

El-Mouelhy said that his “organisation” and six other Australian “institutions” had together paid $A28,000 to MUI officials in 2006, of which “the largest share” went to MUI Chairman at the time, Amidhan Shanerah.

El Mouelhy however did not receive authorisation in return so his accusations may be somewhat skewed as a result of his belief that he was dudded.

Australian Halal Food Services (AHFS), a Melbourne-based business, told Tempo they paid bribes to senior MUI officials to renew their licences to certify abattoirs as halal.

These bribes ranged from $A3000 to $A10,000 and were put directly in the bank account of Amidhan Shanerah.

MUI angrily responded via Tempo in these terms:

In March last year, the current Chairman of MUI, Muhammad Sirajuddin Syamsuddin stated that the MUI recognises dozens of halal certifiers in Australia. In fact, there was only one who failed the test and that was none other than Mohamed El-Mouelhy.

The halal certification company owned by this Mouelhy man was disqualified in 2006 because he had no scientific involvement in his business, and no Islamic law experience, even though he claimed to be an expert himself because he was Egyptian.

But the MUI claims there must be at least two people involved, one Islamic law expert and one Islamic scientist.

Director of meat processors JBS Australia, John Berry, told Tempo the high cost of halal certification was limiting business and was concerning to Australian meat exporters who deal with Indonesia.
(end response)

These explosive accusations have sparked an outcry among Indonesians who slammed the MUI monopoly of the halal industry deeming its conduct as ‘haram’.

“Heart and conduct must be halal too,” tweeted Rudy, an angry Indonesian.
Others responded:
@bloomer22 :
“halal certificates are issued through haram process”. if it’s true then shame on you, MUI !*
@sophienyan
“Basically it’s like you can sell Allah’s rules to the highest bidder.”
@ryan_triana :
“this is disgusting, how can a religious institution betray their own beliefs??”
@NickFongers
“it’s the power of money..!!!”
@sunnili:
Fascinating investigation on this Halal labelling scam. Indo Islamic council taking bribes for certification.

The Jakarta Post, Indonesia’s leading English-language daily, followed up with this:

Editorial: “Halal and Transparency”
Sat, March 01 2014 (excerpts)

“For decades the stench of the lucrative ‘business’ behind halal certification has been more than apparent to the public, but suspicions have drifted with the passing winds.

“That is until a “halal for cash” story, allegedly involving the Indonesian MUI, was picked up by Tempo magazine.

“The MUI brings together Muslim figures from various Islamic organisations whose integrity and knowledge about Islam is beyond question.

“Therefore, it has been taken for granted that everything the MUI did was for the good of the ummah (the Muslim community).

“Tempo quoted Mohamed El Mouelhy, (there’s that man again) admitting to having spent $A28,000 on airfares, hotel and lodging and travel allowances when he arranged the visit of MUI officials, including chairman Amidhan Shanerah.

“Amidhan Shanerah branded El Mouelhy’s remarks as libellous, saying his trip was covered by the Indonesian Government.

“The struggle for power has intensified not only because of the “halal for cash” report but also, and more importantly, because of the Government’s bid to control halal certification.

“As certified products are for public consumption, a strict control mechanism is imperative. Under the existing arrangement, no-one dares to exercise oversight of the MUI.” (end editorial)

While Indonesia is attempting to tackle halal certification corruption in its own country, Australia turns a blind eye, allowing an open slather, for fear meat exports may be affected.

But, aside from meat, corrupted practices right here in Australia are deleteriously affecting all of Australia’s domestic consumers.