Everyone needs to calm down

Everyone needs to calm down

The Jakarta administration decided recently to increase the
minimum wage for this province to Rp 591,600, or less than US$60,
from Rp 426,250. The 38 percent increase was stipulated in a
gubernatorial decision signed on Oct. 31. The increase is rather
significant in the current sluggish economy because the old wage
covered only 81 per cent of the monthly cost of living for a
single person in Jakarta.

Jakarta Governor Sutiyoso said last week that the step had
been taken after listening to the opinions of many parties,
including employers and neutral experts from the University of
Indonesia. He said that, in deciding upon the wage rise, the
authorities had made a serious attempt to ensure that it would
not have a negative impact on the business sector. He expected
employers to implement the new regulation and exercise the wisdom
of openness so that everything would be clear.

Yet, Apindo, the Indonesian Employers Association, reacted by
saying last Thursday that it would not pay the new minimum wage
set by the Jakarta authorities because the decree had been
decided unilaterally. It said that the association would quit the
Wage Commission at its next meeting because "the Commission had
ceased to function." Apindo's statement was drafted in a meeting
with its 14 board members in Jakarta on that day. "It is useless
to attend the Commission meeting because the authorities have
always taken the side of the workers and turned a deaf ear to
us," said Suwito, one of the executives who had represented the
Association in meetings with the government.

Meanwhile, the Chairman of the Indonesian Retail Merchants'
Association (Aprindo), Hari Darmawan, told a press conference on
the same day that businesspeople were still attempting to recover
from the various catastrophes that had followed the 1997 economic
crisis. In addition, they were now also feeling the pinch as a
result of the Sept. 11 terrorist attacks in the United States,
which had heavily hit business in general.

"Last year, amid all our economic difficulties and low profit
margins, we agreed to a Rp 426,250 minimum wage compared to the
previous year's minimum wage of Rp 350,000. This proposed
increase is devastating for us," Hari, who owns the Matahari
chain of department stores, said.

Every thinking citizen in this country fully understands the
current devastating economic crisis as well the reality that the
problem with our blue collar workers -- and also civil servants
-- has dragged on and on for decades. Labor has been the main
victim of the system, especially when the military regime of
president Soeharto not only showed no hesitation in using troops
to rob the labor unions of their bargaining position to improve
the welfare of their members but also to brutally emasculate
them.

We also understand the complaints of the employers, who have
always viewed the issue from the business point of view but fall
short of mentioning any efforts they have made to improve the
welfare of their workers.

We also underline Governor's Sutiyoso's statement urging the
employers to be open in resolving their problem with the workers.
But Sutiyoso failed to elaborate on his statement by, for
example, urging the businesspeople to mention their profit
margins and lay bare all the illegal levies imposed on them by
corrupt officials.

The governor, who has to face constant labor problems in his
jurisdiction, seems to be badly in need of a strong economic team
so that his administration can delve deep into the problem.

But above all, what needs to happen today is for every party
to accept the Jakarta administration's decision because it has
been decided through democratic deliberation and has therefore
become law.