Ridwan Max Sijabat, Jakarta – A labor union has accused senior officials at the Manpower and Transmigration Ministry of misusing Rp 30 billion (about US$3.3 million) in funds earmarked for the severance pay of workers with oil and gas companies.
The funds that are unaccounted for have left thousands of dismissed workers without the severance pay they are entitled to, the Federation of Workers Unions in the Chemical, Energy, Oil and Gas Mining and Public Works Sector (FSP-KEP) reported.
The union claims that part of the funds have been used to finance the construction of three hospitals for workers in North Sumatra, Riau and Papua and to purchase two luxury cars for two senior officials at the ministry.
"We found irregularities in the provision of Rp 30 billion of the funds for the three labor hospitals and in the purchase of luxury cars," union chairman Sahat Butar-butar told The Jakarta Post on Wednesday.
He added that the union was still completing a comprehensive report that it intended to file with the Corruption Eradication Commission (KPK).
Sahat also said that workers had no representation in managing the funds and they had not received a report on how the funds were managed.
Based on a joint ministerial decree issued by the manpower minister and the mining and energy minister, subcontractors in the oil and gas mining sector have since 1995 been required to put aside 8.33 percent of their contracts' value for severance payments for all dismissed workers.
The scheme was initially carried out by state-owned insurance firm Astek and the Severance Pay Scheme Foundation (YDTP).
The foundation was liquidated in 2000 and a government team was appointed by the manpower minister to manage the foundation's assets and funds totaling Rp 155 billion. The reason for the closure of the foundation was not made public.
The team is led by Muzni Tambusai, the director general for industrial relations at the ministry. Following YDTP's liquidation, subcontractors have set up a severance payment scheme for their own workers.
Sahat also claimed that the funds belonged to workers and had to be paid to potential recipients.
"The absence of transparency in the funds' management has raised allegations that the government officials in the team have personal interests in holding on to the funds," he said.
Muzni dismissed the accusations, saying the funds did not belong to workers because they had been collected from subcontractors that won projects from Pertamina and its partner companies in the oil and gas mining sector.
"Of course, the funds collected from subcontractors were aimed at providing severance pay for contract workers after their terms expired," he said, citing about 38,000 dismissed workers who had participated in the scheme but had not received their severance pay.
Muzni also acknowledged that his team had paid Rp 30 billion to establish three hospitals for workers in Medan, Pekanbaru and Sorong but claimed it was taken from the interest on the funds.
"Suspicions could arise over possible irregularities in the deal but we made it in accordance with the rules of the game," he said without giving any details about the hospitals.