Jamsostek to pay high interest rate for pension program
Jamsostek to pay high interest rate for pension program
The Jakarta Post
Jakarta
State social security company PT Jamsostek will meet its pledge
to pay an interest rate of 8.5 percent on its pension funds this
year after a good performance in 2004, the company's president
director says.
The rate, 2.5 percent higher than that offered by commercial
banks, would be paid to about 24 million workers who contribute
to the scheme, Jamsostek head Achmad Djunaidi said on Wednesday.
Djunaidi said the firm's Rp 3.3 trillion (US$360.7 million)
profit from its investments last year would finance the payout.
All members of the scheme would start enjoying the higher
interest rate this month, he said.
He added that 80 percent of Jamsostek's total assets worth Rp
33 trillion came from the pension funds.
Jamsostek's investments in the stock market and its purchase
of bonds and mid-term notes were major contributing factors to
the high profit, Djunaidi said.
"The investment in stock markets yielded Rp 489 billion, the
purchasing of bonds and mid-term notes was at Rp 1.5 trillion,
and the investment in bank savings, properties and mutual funds
yielded more than Rp 1 trillion," he said, adding that Jamsostek
has always complied with Government Regulation No. 22/2004 on
prudent investment policy by investing a larger share of its
assets.
He said management would remain vigilant when investing
pension scheme money to avoid the kind of losses Jamsostek
recently suffered in connection with the Bank Global financial
scandal, in which Jamsostek reportedly lost billions of rupiah in
investment in the bank.
"We will remain prudent when investing because Jamsostek's
assets, which are invested in numerous schemes, belong to workers
and the investment yields are accumulated to help improve
workers' social welfare," he said.
Separately, director of operations and services Indra Haryadi
said along with raising the pension funds' interest, Jamsostek
would increase workers' compensation for occupational accidents.
"We are still formulating a mechanism to increase the
occupational accident compensation and reviewing the health care
program without having to increase workers' premiums," he said.
He said it would be untenable for Jamsostek to increase the
workers' premiums because the slow economic growth in the country
had already led to a decrease in the number of workers
participating in social security programs.
Workers with the support of their employers have contributed
almost 7 percent of their gross monthly salaries to Jamsostek's
life insurance, accident compensation and pension packages.