House commission wants end to social security monopoly
House commission wants end to social security monopoly
JAKARTA (JP): A commission of the House of Representatives
(DPR) yesterday called on the private sector to establish social
security companies and end the virtual monopoly of the state-
owned PT Astek.
The House's Commission VI on labor affairs said the more
companies running the program, the more efficient and effective
the social security programs should be.
The proposal was made during a hearing between the commission
and directors of Astek, which had been criticized for the way the
state company has been managed.
M.Z. Wasaraka of the ruling Golkar faction, who chaired the
hearing, questioned Astek's monopoly in running the social
security program for workers in Indonesia.
The company should share the burden with other companies, he
said, pointing out that healthy competition would mean that
companies could strive to give their best service to workers.
Astek, a state company administered by the Ministry of
Manpower, currently has a virtual monopoly over the business of
providing social security programs, although the 1992 law on the
subject made no mention of it being the only company.
By last December, Astek's Jamsostek program has covered 45,500
companies and 5.7 million workers. Its funds had accumulated to a
total of Rp 1.7 trillion ($800 million).
Jamsostek program covers health, pensions as well as
protection against accidents and death at work places.
Astek President Abdillah Nusi argued during the hearing
however that more companies necessarily means greater efficiency.
"Astek principally has no objection to the commission's
suggestion, but the factors of inefficiency and ineffectiveness
should be taken into consideration," he said.
Even in countries like the United States, Canada and Britain,
there is now a tendency to hand over the business of providing
social security programs to a single company, state or private,
he said.
Never late
Abdillah said his company has the capacity to handle all the
social security program needs of Indonesia by itself for at least
the next 15 years.
He pointed out that Astek had so far only managed to tap about
30 percent of the 140,000 companies which by law should provide
social security programs to their workers.
He also defended Astek's record in maintaining its services to
the participants of the program, pointing out that the company
was never late in paying claimants.
Abdillah, who was appointed as president by Minister of
Manpower Abdul Latief last February, said he was currently
revamping the company as part of his effort to recruit a total of
30 million workers to join the Jamsostek within the next 15
years.
The company's campaign had focused more on informing companies
of their obligation to provide social security programs for
workers. Now the campaign is emphasizing enforcement, he said.
The 1992 law on social security stipulates that all companies
employing more than 10 workers must enlist them into social
security programs. Violators are subject to a fine of Rp 50
million or six months imprisonment.
Responding to a question, Abdillah ruled out the possibility
of foreign investors entering the social security business in
Indonesia. (rms)