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Workers rally against controversial pension scheme
Jakarta Post - July 4, 2015
"This is just a warm up. We will keep fighting against capitalism to seek justice for workers. This wave of protests will not stop if the government doesn't change the regulation," said one of the female protesters.
The protester was referring to Government Regulation No. 46/2015 on the withdrawal of old-age benefit (JHT) funding. Under the regulation, subscribers of the JHT scheme could withdraw their pension fund only after 10 years of enrolment in the program, as opposed to the five year minimum period mandated by the 1992 Social Security Law, the basis for the old social security programs.
After the regulation took effect on July 1, a great number of workers and lawmakers have filed a petition to protest the regulation.
In response to the brouhaha, the House of Representatives Commission IX overseeing labor issues and health, plans to summon Manpower Minister Hanif Dhakiri and executives from the Workers Social Security Agency (BPJS Ketenagakerjaan) to seek clarification about the regulation.
Commission IX member Okky Asokawati, a politician from the United Development Party (PPP) and a former catwalk model, said the new regulation was in contradiction with the 2004 national social security system itself.
"Under the old regulation, workers could withdraw their JHT funds after five years of membership in the program, but under the new regulation, the JHT funds can be withdrawn only after 10 years of membership, and withdrawals are limited to ten percent. This will definitely affect workers," she said.
The government and BPJS Ketenagakerjaan have defended the new regulation, saying that it was aimed at protecting workers when they retire.
"If a worker is laid off and then all of their JHT funds can be withdrawn at once, then it would be against Law No. 40/2004 on national security systems," Hanif said on Thursday, referring articles 35 and 37 of the law which stipulated that old-age benefit funding can only be withdrawn after 10 years of paying premiums.
Hanif said that laid-off workers should not withdraw their pension fund as they were already given a severance payment.
"If the problem is termination of employment [PHK], then there's already the severance payment scheme as a means of protection. The JHT is often perceived as a regular savings scheme. That's what participants of the program should understand," said Hanif.
Social security expert Bambang Purwoko expressed his concern over the lack of understanding between lawmakers and the workers protesting the new regulation.
"The JHT and pension programs are designed to protect workers approaching retirement age. The JHT benefit will be paid in a lump sum while the pension benefit will be received on a monthly basis. Of course, the funds belong to workers and they have the right to take it but if the funds are withdrawn long before their retirement, they will be left unprotected and this is what the law seeks to address," he told The Jakarta Post on Friday.
Bambang, also a professor of social security studies at the University of Indonesia and Pancasila University, said the BPJS Ketenagakerjaan could face financial problems and difficulty rolling out their other programs like affordable housing if workers were allowed to withdraw the social security funds earlier. "Like banks, the BPJS Ketenagakerjaan could face a rush," he said.
The BPJS Ketenagakerjaan's assets have reached Rp 170 trillion (US$12.76 billion), a large part of which is JHT funds that will be paid to workers in due course, in accordance with the regulation.
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