Jamsostek explains

In response to Mr. Johni Hutabalian's letter in the Dec. 17 edition of The Jakarta Post titled "Labor Insurance" (from Kompas), we would like to give the following explanation:

1. Government Regulation No. 14 of 1993 determines the insured amount for participants in the state-owned social security company's occupational accident insurance, life insurance, retirement funds and health insurance.

2. The executive body of PT Jamsostek is continuously endeavoring to increase the insured amounts so that our programs benefit those it insures. But our efforts to do this are governed by the company's capacity and its financial development. For example, the insured amount for life insurance has been increased five times since the establishment of Astek until its present program in Jamsostek. The rates have increased from Rp 170,000 to Rp 1,200,000. The company is now calculating another increase in the insured amount to be proposed to the government.

3. The amounts paid to the victims of the Garuda plane at Sibolangit varied. The total indemnity payment for the families of the 45 victims amounted to Rp 3,566,256,156. Based on the victims' wages reported to PT Jamsostek, the victims' families received payments according to the regulations in force, i.e. 60 percent times 60 months of salary = 36 months of salary. Therefore, the payment varied from Rp 10 million to Rp 572 million.

4. In its management of funds, PT Jamsostek adheres to Government Regulation No. 28 of 1996 on the Management and Investment of Jamsostek Program Funds. Of the profits from the investment of funds collected, a certain amount is put aside for dividends (the government), 30 percent is allocated to projects that help our participants (like workers' houses, training, training of handicapped workers, worker safety and health, scholarships for workers' children, free medical costs for workers and aid to the model workers), while the remainder is used for the development of small businesses, pre-welfare funds, etc. Thus, PT Jamsostek has never used funds from contributions outside the program. Workers' funds are safely saved and are always evaluated for their adequacy.

5. Your opinion that retired employees of PT Jamsostek get very high pensions compared to Jamsostek participants is very unfounded. Everything has been regulated in Law No. 11 of 1992 on Pension Funds and Government Regulation No. 76 of 1992 on Employers' Pension Funds. With reference to the two regulations, PT Jamsostek determined the Regulation on Pension Funds of PT Jamsostek's employees.

R. IRAWAN

Public Relations

PT Jamsostek