Industrial action for higher wages likely: Observers
Industrial action for higher wages likely: Observers
Ridwan Max Sijabat, The Jakarta Post, Jakarta
Labor activists and observers predict that more state enterprises
will be threatened with massive strikes since most of their staff
are underpaid.
Federation of State Enterprises' Trade Unions (Federasi SP
BUMN) chairman Abdul Azis Hasan said strikes were seen as the
last resort to force the government to improve the employees'
remuneration standard, which is lower than that of civil
servants.
"After employees of several state-owned companies (threatened
to) walk off their jobs recently, PT Pelni workers are likely to
follow suit because the sea transportation firm can no longer
compete with airline companies," Abdul said on Thursday.
He underlined that labor unions in state enterprises had grown
stronger amid the reform euphoria, which made employees much more
aware of their rights.
Most state enterprises do not comply with core labor standards
in accordance with the Labor Law. Of 158 state enterprises, only
60 percent or 94 companies have adopted a collective labor
agreement with their management, Abdul said.
"A series of threatened strikes involving employees of
aircraft maker PT Dirgantara Indonesia, railway company PT KAI,
national flag carrier Garuda Indonesia and oil and gas firm
Pertamina reflect not only mismanagement and inefficiency, but
also the government's violation of core labor standards," he
said.
Separately, International Transport Federation (ITF) country
representative Hanafi Rustandi said that state enterprises in the
transportation sector had lost out to private competitors because
of mismanagement and inefficiency.
"Garuda, Merpati, KAI, Pelni and Damri are not competitive
because of severe financial difficulties and rampant corruption
which has led to inefficiency," he said.
State enterprises, he added, had long served as cash cows for
the government and ruling political parties, making them unable
to improve their employees' welfare.
Hanafi and Abdul both said that poor labor conditions were a
time bomb that could explode at any time if no radical measures
were taken to improve the companies' performance.
The coordinator of BUMN Watch, Naldi Nazar Haroen, said the
government's failure to take bold measures against inefficiency
and corruption would result in many state enterprises collapsing
in coming years.
"Most state enterprises remain unhealthy since they have been
subordinated to technical departments controlled by politicians.
The companies will continue functioning as money machines for the
bureaucracy and ruling parties," he said.
A recent BUMN Watch study revealed that only 15 of the 158
state enterprises had booked annual profits over the last few
years. Of the profitable firms, only a few have adequately
improved their employees' welfare.
Naldi said that to boost profits, the enterprises should first
of all be divided into profit-oriented and public service-
oriented ones. Learning from Malaysia, the companies should be
overseen by a holding company chaired by a professional, instead
of a minister.
"Profit-oriented companies have to develop professional modern
managements and be required to meet certain targets," he said.
Under such a structure, Malaysian state enterprises contribute
to 85 percent of the country's annual state budget.
State enterprises in Indonesia control Rp 1.158 trillion in
total assets, but contribute only 2 percent or Rp 23 trillion
annually to the state budget, Naldi said.