Astek diversification plan meets opposition
Astek diversification plan meets opposition
JAKARTA (JP): The state-run insurance company PT Astek's plan
to invest its clients' money in other ventures met with strong
objection from the House of Representatives yesterday.
Legislators from different political factions joined hands in
a hearing with Astek officials to foil the plan, which they said
was "deviating from the firm's original mission as a non-profit
institution".
Members of House Commission VI on labor affairs suggested that
Astek stick to its original social mission, as required by the
1992 law on social security program.
"The law prohibits Astek from becoming a business entity,"
legislator Odiyanto of the Armed Forces faction said. "Astek is
to serve workers' interests and nothing else."
Astek President Abdullah Nusi told the hearing, chaired by
legislator Haris Soedarno, that the firm means to set up
subsidiaries and use the profit for the welfare of workers and to
create more jobs.
He said Minister of Manpower Abdul Latief and Minister of
Finance Mar'ie Muhammad, in their capacity as Astek's share
holders, have approved the plan.
"Astek means to set up subsidiaries with cement, pulp and
paper, property and hospitals as their core business. This would
be better than depositing the funds in banks," he said, adding
that almost all developed countries do the same.
Astek, set up in 1987 to manage social security insurance,
which covers occupational accidents, health care and pension
funds, has accumulated Rp 3.2 trillion (US$1,4 billion) from 7.6
million workers. Over 51,000 companies have participated in the
program. Its investment fund is expected to reach Rp 15 trillion,
with about 30 million clients, in the year 2000 and Rp 70
trillion with 87 million clients in 2018.
Opposition to the diversification plan also came from a
legislator in the ruling Golkar party, Rambe Kamarosaman.
"This company was established not to do business and make
profit but to serve and protect workers," he said.
Pranowo, of the Armed Forces faction, said that Astek, as a
state-owned company should, instead of doing business, focus on
giving its best service to workers.
"The funds that have been accumulated by Astek belong to the
workers. Therefore, they have a priority to be served and
protected.
"But now what happens? Astek has yet to succeed in enforcing
the law, to have all paid workers and companies participating in
the social security program," he said.
Royani Haminullah of the Indonesian Democratic Party faction
warned that Astek should be extra-careful in managing the funds
it has collected from workers, saying that the more subsidiaries
the company had, the more inefficient it would be.
He stressed that Astek should not put the funds on the line as
most workers still live in poverty.
Citing recent findings of the Government Audit Agency, he said
that Astek has used the participants' money for unaccountable
projects.
He cited, as examples, that the company purchased Rp 1.4
billion shares of Damai Indah Padang Golf and Cibodas Golf Park
in West Java in 1993, and Rp 9.2 billion shares of PT Textronics.
Minister Latief also said recently that PT Astek was planning
to establish a pulp and paper factory and a cement plant, which
would be financed with the participants' money. (rms)