Jamsostek to pay high interest rate for pension program<\/p>\n
The Jakarta Post
\nJakarta<\/p>\n
State social security company PT Jamsostek will meet its pledge
\nto pay an interest rate of 8.5 percent on its pension funds this
\nyear after a good performance in 2004, the company's president
\ndirector says.<\/p>\n
The rate, 2.5 percent higher than that offered by commercial
\nbanks, would be paid to about 24 million workers who contribute
\nto the scheme, Jamsostek head Achmad Djunaidi said on Wednesday.<\/p>\n
Djunaidi said the firm's Rp 3.3 trillion (US$360.7 million)
\nprofit from its investments last year would finance the payout.<\/p>\n
All members of the scheme would start enjoying the higher
\ninterest rate this month, he said.<\/p>\n
He added that 80 percent of Jamsostek's total assets worth Rp
\n33 trillion came from the pension funds.<\/p>\n
Jamsostek's investments in the stock market and its purchase
\nof bonds and mid-term notes were major contributing factors to
\nthe high profit, Djunaidi said.<\/p>\n
\"The investment in stock markets yielded Rp 489 billion, the
\npurchasing of bonds and mid-term notes was at Rp 1.5 trillion,
\nand the investment in bank savings, properties and mutual funds
\nyielded more than Rp 1 trillion,\" he said, adding that Jamsostek
\nhas always complied with Government Regulation No. 22\/2004 on
\nprudent investment policy by investing a larger share of its
\nassets.<\/p>\n
He said management would remain vigilant when investing
\npension scheme money to avoid the kind of losses Jamsostek
\nrecently suffered in connection with the Bank Global financial
\nscandal, in which Jamsostek reportedly lost billions of rupiah in
\ninvestment in the bank.<\/p>\n
\"We will remain prudent when investing because Jamsostek's
\nassets, which are invested in numerous schemes, belong to workers
\nand the investment yields are accumulated to help improve
\nworkers' social welfare,\" he said.<\/p>\n
Separately, director of operations and services Indra Haryadi
\nsaid along with raising the pension funds' interest, Jamsostek
\nwould increase workers' compensation for occupational accidents.<\/p>\n
\"We are still formulating a mechanism to increase the
\noccupational accident compensation and reviewing the health care
\nprogram without having to increase workers' premiums,\" he said.<\/p>\n
He said it would be untenable for Jamsostek to increase the
\nworkers' premiums because the slow economic growth in the country
\nhad already led to a decrease in the number of workers
\nparticipating in social security programs.<\/p>\n
Workers with the support of their employers have contributed
\nalmost 7 percent of their gross monthly salaries to Jamsostek's
\nlife insurance, accident compensation and pension packages.<\/p>",
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