'Industrialists remiss on workers' welfare'

JAKARTA (JP): Minister of Manpower Abdul Latief lashed out at Indonesian industrialists yesterday, saying that most of them only emphasize the profit aspects of their companies but neglect the welfare of their workers.

Addressing a seminar held by the National Council on Wages, at the Borobudur Hotel, the minister said the government's regulation on minimum wages is designed to protect workers' welfare.

"So far, most Indonesian industrialist are just like traders, who do not pay much attention to the development of human resources," Latief said, adding that such an attitude did not reflect the true role of professional industrialists.

He also pointed out the importance of workers' welfare, which, he said, "is one of the main factors supporting a company's productivity," and that good workers are like an asset of the company.

He said that, in the present era of global changes, low wage levels are no longer regarded as a comparative advantage.

"Only when the workers feel secure for their welfare and get reasonable pay can they do a good job, which yield to higher productivity," he said, adding that low wages might hamper the workers' creativity and efficiency.

Latief, a successful businessman, who built the Sarinah Jaya empire, recruited by President Soeharto into the cabinet, also dismissed the arguments often put forward by his former colleagues that wage increases should be linked to productivity.

He argued that companies should first ensure that their workers' welfare is well taken care of before discussing any link between wages and productivity.

Stressing that labor issues can be manipulated politically, he said that his ministry has always wanted to settle the issue strategically and conceptually.

Yesterday's seminar was attended by about 200 participants, who represented various business companies and government institutions.

Another keynote speaker at yesterday's meeting was the director general of taxes, Fuad Bawazier.

Bawazier said that the government taxation system is designed to support the development of human resources by improving technical skills and know-how.

He cited, as an example, that the money collected from income taxes is used partly to finance the training of workers, to provide them with scholarships, as well as to conduct research and development activities, all of which are for the workers' own benefit.

He said that income taxes should not be a burden to workers, because the government has introduced a policy to exempt them, especially the low-income workers, from paying taxes.

Those workers with small incomes, but who have big families to support, are exempted from paying tax.

Currently, the government applies tax exemption for workers with a spouse, three children, and yearly income of Rp 5,184,000 ($2,305). (03)