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Labour rally in Jakarta demands 15% wage rise, highlights rise in cost of living

CNBC Indonesia - October 27, 2023

Rosseno Aji Nugroho, Jakarta – The Confederation of Indonesian Trade Unions (KSPI) and the Labour Party held a demonstration near the Horse Statue in Central Jakarta on Friday October 27 demanding a 15 percent increase in the minimum wage for 2024.

"We demand a wage rise of at least 15 percent", said a speaker on the command vehicle at the location.

Hundreds of workers took part in the action today. They came from a number of different trade unions that are under the wing of the KSPI such as the Indonesian Trade Union Federation (FSBI) and the National Trade Union (SPN).

The action was initially planned to be held in front of the nearby State Palace, but Jalan Merdeka Barat had been closed off by police so the workers demonstrated at the Horse Statue instead. As of 2.13 pm the demonstration was still continuing.

KSPI President Said Iqbal, who is also the president of the Labour Party, said that there are several reasons why workers are asking for a 15 percent wage rise. One of the reasons is that that Indonesia has been classified as an upper-middle income country.

With an annual per capita income of around US$4,500, this is equivalent to 5.6 million rupiah a month. Iqbal said that the Jakarta provincial minimum wage (UMP) should therefore be increased by 700,000 rupiah a month.

"A middle-income country in the upper grouping with a minimal income of US$4,500. If multiplied by 15,000 rupiah [the US dollar exchange rate], divided by 12 months, this comes to 5.6 million rupiah per month. Jakarta's [UMP] is currently 4.9 million. To get to 5.6 million rupiah, in an upper-middle income country, this is still 700,000 rupiah short, that's 15 percent. So we're not just making this up", he said.

Iqbal also highlighted the recent 8 percent wage rise for civil servants (PNS), the TNI (Indonesian military) and Polri (Indonesian police), and 12 percent in pension funds.

Workers agree with these wage rises. But what Iqbal does not agree with is if the increase in workers' wages is as a taxpayer is smaller compared with those who are paid through taxes. Therefore, the increase in workers' wages must indeed be 15 percent or higher than civil servants.

Aside from the grounds above, another reason is the results of a Labour Party and KSPI research and development (Litbang) survey which found that the average reasonable living cost index had risen by 12-15 percent.

"A survey of the price of meat, rice, and so on, 64 items, surveys of several regency and municipal markets, an increase of 12-15 percent. This is connected with the 12-15 percent rise in pensions", he explained.

The other argument is related to food prices. Iqbal said that the increase in rice prices has now reached 40 percent. Then other food items have also increased by about 15 percent. This is in line with the inflation rate which is released every month the Central Statistics Agency (BPS). So based on this argument, Iqbal stressed that the provincial minimum wage for 2024 should be raised by 15 percent.

"Just look at the BPS' [figures]. The inflection in food [prices] that are consumed by the lower layers of society", said Iqbal. (wur)

[Translated by James Balowski. The original title of the article was "Buruh Demo Minta UMP 2024 Naik 15%: Harga Beras-Daging Naik!".]

Source: https://www.cnbcindonesia.com/news/20231027142631-4-484257/buruh-demo-minta-ump-2024-naik-15-harga-beras-daging-nai