House urged to keep Jamsostek monopoly
Ridwan Max Sijabat, The Jakarta Post, Jakarta
State-owned insurance company PT Jamsostek and labor unions have strongly urged the House of Representatives to maintain the government's monopoly in running social security programs for workers, in its amendment of the social security law to allow private company participation.
They appreciated the House's move to amend Law No. 3/1992 and reform social security programs but opposed the proposal to allow the private sector to take part in running basic insurance programs. Besides being contrary to internationally-accepted principles on social security, the workers would be unclear on their basic protection rights, they argued.
"Both the government and the House should fully understand the Human Rights Declaration and International Labor Conventions on labor protection. They should anticipate negative consequences for such a ruling," Jamsostek's operation director Djoko Sungkono told The Jakarta Post by telephone from Singapore.
Djoko, along with several legislators and insurance experts, was in Singapore for the last leg of a week-long road show to conduct a comparative study on the implementation of social security systems in Southeast Asian countries and South Korea.
He was commenting on the House's recent decision to amend the social security law immediately, to allow the private sector to participate in providing social security schemes for workers.
Djoko, also an insurance expert, explained that social security programs were actually the state's responsibility in providing protection for workers.
"The social security scheme is mandatory because it is the government's obligation to provide protection for workers. So far, we have been running four of nine obligatory social security programs. The four are health care, occupational accidents, life insurance and pension programs.
"No country in the world has allowed private companies to run such programs for reasons of accountability," he said, adding that there was no guarantee for workers if private companies were bankrupted while running the programs.
Hikayat Atika Karwa, deputy chairman of the Confederation of All-Indonesian Workers Union (KSPSI) criticized the House for politicizing the social security issue. He said, a number of labor unions had joined force with KSPSI to oppose the House's proposal to allow private companies to run the programs.
"The House should not amend the social security law in order to make money from private companies. The proposed reform of the social security system is much needed, but to benefit the workers not to steal their money," he said.
Muchtar Pakpahan, chairman of the Indonesian Prosperity Trade Union (SBSI), said his union would also be strongly opposed to private companies involvement in the programs.
"Our current congress recommends that the government should hold a monopoly in running the social security programs. This allows better service and maximum benefits for the workers," he said.
Djoko has also urged the House to approve Jamsostek's proposal to become a nonprofit institution, which would be directly supervised by the President.
"Under a nonprofit status, the government, currently the biggest shareholder, would no longer get dividends from the company's annual profit. The government would also be required to contribute to the programs to show its commitment to providing protection for the people, as in South Korea, Thailand, Malaysia and Singapore," he said.
Under the four programs operating, Jamsostek has collected Rp 21.6 trillion from 26 million workers and 107 companies across the country. A bigger part of the assets has been deposited in state-owned banks, blue-chip shares and SBI promissory notes.