Fri, 05 Sep 2003

Govt to provide compensation for PT DI workers

Moch. N. Kurniawan and Fabiola Desy Unidjaja, The Jakarta Post, Jakarta

The government rejected on Thursday demands to void a decision by state aircraft maker PT Dirgantara Indonesia (PTDI) to suspend indefinitely 6,000 employees, but promised to raise some US$50 million to provide them with compensation.

Speaking to reporters on Thursday, Vice President Hamzah Haz said the compensation would be taken from the restructuring fund allocated to the company.

"The Indonesian Bank Restructuring Agency (IBRA) has proposed a program to save the company, which requires those who intend to acquire PTDI to prepare US$50 million as a compensation fund for the 6,000 dismissed workers," he said.

Hamzah said the manner of the suspension showed the government's commitment to treating the company's employees fairly, as "it (the suspension) was carried out in accordance with the existing law."

By suspending most of its employees, the aircraft maker was given a chance of recovery, he said.

"If the company's financial condition starts to recover, it can reemploy those who have been suspended," he added.

Hamzah warned the employees against venting their disappointment through violence, as it would only make additional complications and discourage potential investors to acquire the company.

The company suspended indefinitely 9,000 employees in May, citing financial constraints. The decision sparked protests, as employees claimed the had not been consulted before the policy was carried out.

After days of demonstrating, the company allowed 3,000 employees to complete standing orders from both foreign and domestic institutions.

The Bandung-based company plunged into a financial crisis with the fall of President Soeharto in 1998, who regarded the technology sector as the nation's pride. It was built with the help of then research minister B.J. Habibie, who later succeeded Soeharto following his downfall.

The post-Habibie administrations considered the company was unhealthy and a financial burden to the state.

Thousands of PTDI employees took to the streets on Thursday for the second time in as many days to renew their demand to be reemployed. They gathered in front of the State Palace after driving in a motorcade across the capital from the haj dormitory in Pondok Gede, East Jakarta.

The rowdy protest could be heard inside the Palace, where President Megawati Soekarnoputri was accepting credential letters from new ambassadors from Canada, Kuwait and Slovakia.

The rally proceeded peacefully.

On Wednesday, the workers staged a protest at the House of Representatives.

Some of the protesters said they would continue to demonstrate either in Bandung or Jakarta until the government complied with their demand.

In response to the demand, State Minister for State Enterprises Laksamana Sukardi appealed to the employees to understand that the restructuring program was aimed at saving the company.

"We have to understand that the financial and organizational conditions of the company need to be restructured. The company is bleeding," he said.

He said the government was aware that the decision could not satisfy everybody, but insisted that the survival measure was unavoidable.

"We have all agreed that we will abide by the regulation and the manpower minister will facilitate the problem-solving process," Laksamana said, referring to Jacob Nuwa Wea.

He promised his office would open a training center for the employees, so they could find placement at other state-owned enterprises.