House-saving scheme for workers planned
JAKARTA (JP): The government is planning to implement a savings scheme to aid low-income employees of private companies in purchasing their own homes, Minister of Public Housing Akbar Tanjung said yesterday.
He told reporters after meeting with President Soeharto at Merdeka? Palace that the planned saving scheme would be implemented for those with a monthly income of less than Rp 500,000 (US$224).
Tanjung met with the President to report on the preparedness of the Indonesian delegation for the UN Conference of Human Settlements (Habitat II) in Istanbul, Turkey from June 3-14. Tanjung will lead the delegation.
Housing will be one of the conference's main issues.
In his response to the planned saving scheme, Soeharto said it should not be compulsory. The workers should save the money voluntarily and the funds should be used for the benefit of the workers.
The President also stressed that fund management must be open and transparent, Tanjung said.
The office of the Minister of Public Housing, in cooperation with the Management Institute of the School of Economics at the University of Indonesia, has conducted a study on the house saving scheme for the employees of private companies, he said.
"The conclusion is that the employees are able to save a certain amount of money in accordance with their income. For example, an employee with a Rp 150,000 (US$63.8) monthly income can save up to Rp 4,700," he said.
Employees earning less than Rp 500,000 want the saving scheme because they will be unable to buy a house with their salaries alone, Tanjung said. He added that most of them live in rented houses.
The government started implementing the house saving scheme for civil servants in 1992. Since September 1993, 115,000 civil servants have enjoyed housing loans generated from the savings, according to Tanjung.
Tanjung said that to help provide houses for low-income workers, the government has reduced or even wiped out the permit fees to build low-cost houses.
Meanwhile, during a discussion on housing, Suyono, an assistant to the Minister of Public Housing, said that people in urban areas can't afford houses because of skyrocketing land prices.
"Their incomes are too low compared to the prices of homes," he said in a discussion held at the United Nations Information Center yesterday.
"The prices of houses in Indonesia are more or less similar to those in Singapore, while the income of Singaporeans is 20 times higher than Indonesians," he said.
Due to limited land, the government is promoting the vertical housing program, which also aims at improving slums. The government has given a lot of subsidies because of the high construction costs of apartment houses, he pointed out.
Unfortunately, low-income people prefer slums to apartments, Suyono said.
Therefore, private developers are encouraged to build luxury apartments in the hope that once the wealthy have started to live in apartments, others will follow in their footsteps.
Budhy Tjahjati, deputy chairperson of the National Development Planning Board, said that low-income people do not like apartments because their designs were made without considering the social aspects.
"Low-income people are very communal. They need to be together. Maybe we should broaden the alleys. Maybe we need to build rooms where they can get together," she said. (sim)