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Trade union slams new wage deductions for public housing savings program

CNN Indonesia - May 28, 2024

Jakarta – The Indonesian Trade Union Congress Alliance (KASBI) has criticised the government's plan to require workers aged 20 years and over to participate in the Public Housing Savings Program (Tapera) and have 2.5 percent of their wages deducted for the program.

KASBI Confederation General Chairperson Sunarno said trade unions were never invited to a dialogue by the government to discuss Government Regulation (PP) Number 21/2024 on Amendments to PP Number 25/2020 on the Organisation of Tapera.

"It is very clear that the government decided on the regulation unilaterally. The principle of democratic rights and deliberation was not carried out", said Sunarno on Tuesday May 28,

He believes that the government was too rash in formulating PP 21/2024. In fact, he said, the government does not understand the difficulties faced by the majority of workers up until now.

Sunarno alluded to the issue of low wages, workers whose employment status is vulnerable and are easily laid off, trade union busting, the widespread use of outsourcing and poor occupational health and safety (K3).

He also said that wage deductions for workers at the moment are already very big compared with the amount of annual wage increases that are considered very small.

"BPJS [Social Security Management Agency] health 1 percent, the old-age pension 2 percent, pension guarantee 1 percent, PPH 21 [workers income tax] (take home pay) 5 percent from PTKP [non-taxable income], cooperative deductions, and so on. Add to this to the 2.5 percent for Tapera from workers. So if a worker's wage is between 2 and 5 million [rupiah] a month, then a worker's wage deductions can reach 250-400,000 rupiah a month", he said.

Sunarno also belies the Tapera deductions will clearly burden workers, bearing in mind that they will not automatically get a home in the short term.

He said that the government should focus on providing homes for workers from the state budget, not instead deducting already low workers wages as capital for investment.

KASBI is therefore asking that the government regulation on Tapera be revoked. "We suspect that the salary deductions for Tapera are just a political method in the interests of political capital and the power of the oligarchic regime", he said.

The salaries of workers in Indonesia, including private employees, will be subject to additional deductions for Tapera.

The new policy is contained in Government Regulation Number 21/2024 on Amendments to PP Number 25/2020 on the Organizations of Tapera, which was signed by President Joko "Jokowi" Widodo on May 20, 2024.

Article 5 of the PP Tapera stipulates that every worker that is aged at least 20 years or is married who has an income of at least the minimum wage is required to become a Tapera participant.

Then under Article 7, it specifies that the types of workers who are required to become Tapera participants are not just state civil servants (PNS or ASN), TNI (Indonesian military) and Polri (national police) members along with state-owned enterprise (BUMN) employees, but also private employees and other workers who receive a salary or wages.

"Every worker and self-employed worker who earns at least the minimum wage is required to be a participant", reads Article 5 Paragraph 3 of the regulation.

The government has given a time limit of no later than seven years from the date the regulation came into effect for workers to register with the Tapera Management Agency (BP). This means that employees must register no later than 2027.

The contributions by wage worker participants in Tapera are paid by the employer and the worker themselves, while contributions by independent worker participants are paid by the workers themselves or the freelancer.

A participant's contributions are set based on a specific percentage of pay or wages reported on a monthly basis for employees. Then the average income for a month over the previous calendar year with certain limits for independent workers.

The most recent size of contributions as a percentage is stipulated under Article 15 of Government Regulation Number 21/2024. In Paragraph 1 of the article, it states that the amount is set at 3 percent of the salary or wages of worker participants and 3 percent of the income for independent worker participants.

Paragraph 2 of the same article meanwhile regulates the size of contributions for workers, which are borne jointly by employers who contributes 0.5 percent and workers who contribute 2.5 percent. (yoa/Ugo)

[Translated by James Balowski. The original title of the article was "Buruh Kritik Pemotongan Gaji Pekerja untuk Tapera".]

Source: https://www.cnnindonesia.com/nasional/20240528155725-20-1102912/buruh-kritik-pemotongan-gaji-pekerja-untuk-taper