Commission XI Reveals Proposal to Eliminate OJK Levies through P2SK Law Revision

Jakarta (ANTARA) - Commission XI of the House of Representatives has revealed a proposal to eliminate levies by the Financial Services Authority (OJK) on the financial services industry during discussions on revising the Law on the Development and Strengthening of the Financial Sector (P2SK).

Deputy Chairman of Commission XI, Fauzi Amro, told reporters after a public hearing in Jakarta on Monday that this remains a proposal and has not yet been decided.

Commission XI continues to seek input from various parties, including OJK, Bank Indonesia (BI), the Deposit Insurance Corporation (LPS), and experts in the financial services sector.

Fauzi explained that the separation of OJK from BI under the 2011 OJK Law was initially intended to strengthen supervisory functions while ensuring the institution’s independence.

However, he noted that levies on the financial services industry could potentially create conflicts of interest.

In the ongoing discussions, an alternative has emerged to source OJK’s funding not from industry levies but from surpluses of BI and LPS, which currently enter the state budget as non-tax state revenues (PNBP).

Nevertheless, Fauzi acknowledged that this scheme could raise new issues, particularly if PNBP from other sectors also demand similar treatment, leading to complexities in state financial management.

On the other hand, funding from BI and LPS surpluses is seen as capable of strengthening OJK’s independence if properly implemented, as it reduces direct dependence on financial services industry players.

However, he said the proposal remains contentious. Some parties suggest maintaining selective levies, especially to anticipate situations where BI and LPS do not record surpluses.

In this regard, a selective contribution scheme could serve as an alternative if surplus funding is unavailable, given that OJK’s operations require sustainable financing.

“The best option is for them (BI and LPS) to have surpluses. But if they (BI and LPS) do not have surpluses, where does (OJK’s funding) come from? Well, that might (include) a selective contribution clause,” Fauzi said.

Separately, OJK Commissioner Chairman Friderica Widyasari Dewi stated that her institution respects various proposals regarding changes to its funding scheme, including the option to eliminate industry levies.

According to her, the most important thing is to ensure the institution’s budgetary needs are met to support its extensive tasks and mandates, from supervision and regulation to developing systems and information technology in the financial services sector.

She noted that several strategic programmes, particularly in strengthening supervisory systems and infrastructure, have faced budgetary constraints.

On that occasion, Friderica also emphasised that the funding source change proposal is not yet final and is entirely under the authority of the lawmakers.

This proposal also opens opportunities for a hybrid scheme combining industry funds and state budget allocations, as practised in various countries.

She observed that every funding model has its advantages and challenges, including in terms of institutional independence, so it needs to be carefully formulated to maintain a balance between supervisory functions and national interests.

Meanwhile, during the public hearing, academic from the Faculty of Law at Pancasila University, Fritz Edward Siregar, assessed that financing through the state budget does not automatically eliminate the institution’s independence.

“We must not too quickly state that levies affect independence or that state budget funding creates dependence. In my view, that is too simplistic. What needs to be examined is not just the source of funds, but whether the funding design creates real dependency or not,” Fritz said.

In his view, financing through the state budget actually reflects the institution’s position as a public entity working for the interests of the state and society, as long as it is not used as an instrument of intervention in operational functions.

“What must be avoided is the budget design being used as a tool for intervention or disrupting the institution’s operational functions,” Fritz said.