Ridwan Max Sijabat, Jakarta – Employers are demanding the government review the social security system to eliminate corruption in the management of its huge labor fund, and to facilitate the planned review of the nation's labor law.
The secretary-general of the Indonesian Employers Association (Apindo), Djimanto, said the government had no choice but to amend the 1992 law on social security and reorganize state-owned PT Jamsostek, which carries out the programs.
"Besides reviewing the current four programs, Jamsostek should establish an additional program to provide severance pay for dismissed workers. PT Jamsostek must also be changed into a non-profit trust fund to avoid government interference in the company's internal affairs," he told The Jakarta Post here Friday.
He said employers did not object to raising the current premium of 8 percent to 11 percent and paying an additional premium for the severance pay fund for dismissed workers, provided Jamsostek was revamped so that its Rp 36.6-trillion (over US$4 billion) assets could be controlled by employers and workers as the chief stakeholders.
"The current leadership crisis in Jamsostek is related to the government's full control, including the appointment of its board of directors. Plus, it is unfair that the government gets annual dividends from Jamsostek while its assets belong to the workers."
He added the company had become a haven for corrupt practices and a money-making outlet for certain state officials and political parties.
Recently, the 2,900-member Jamsostek Workers Union brought a no-confidence motion against the company's management to the government and the House of Representatives. The union complained of alleged corrupt practices and cronyism and demanded the replacement of the current board of directors.
The proposals to change the social security programs and reorganize Jamsostek have won support from labor unions, Manpower and Transmigration Minister Erman Suparno and the House of Representatives. Supporters said the moves would ease workers' opposition to the planned review of the labor law.
The Confederation of All-Indonesian Workers Union and the Confederation of Indonesian Prosperous Trade Union said both the recent controversial plan to amend the 2003 Labor Law and the leadership crisis at Jamsostek triggered their call to alter the social security law.
House Commission IX on labor and social affairs is still preparing a draft law to amend the social security program, with the central goal of revamping PT Jamsostek to become a trust fund.
Meanwhile, despite the leadership crisis, Jamsostek booked almost Rp 630 billion in profit in 2005, an increase of 49 percent over 2004. "According to the Supreme Audit Agency (BPK), Jamsostek's financial performance is 'healthy and accountable'," said Iskandar Z. Rangkuti, Jamsostek's director for investment.
Asked about BPK's findings of 48 irregularities in the company, Iskandar said most of the cases have been settled, while three are still being processed.
A number of Jamsostek officials have been questioned by the police in connection with the irregularities. Former Jamsostek president Achmad Djunaidi was convicted earlier this year in a graft case involving the company's purchase of bonds from troubled private banks and companies. He was sentenced to eight years in prison by the South Jakarta District Court, but has appealed the verdict.