Lecturer's Salary of Rp2.6 Million: Is the Problem Really That Simple?

A lecturer’s statement at the Constitutional Court regarding the basic salary they received some time ago sparked widespread discussion about the welfare of educators in Indonesia. The basic salary figure of around Rp2.6 million presented during the hearing generated public sympathy as well as demands for the government to immediately adjust lecturers’ income. For some, this amount is considered disproportionate to the lengthy education process, the high level of competence required, and a lecturer’s responsibility in carrying out the Tri Dharma of higher education.

At first glance, this problem appears simple. Lecturers’ salaries are considered too low, so the solution is to raise the basic salary. However, upon closer examination, the issue of lecturer welfare is actually far more complex than just the figure stated on a payslip. The biggest mistake in this polemic is viewing all lecturers as a single group with the same problems, when in fact the conditions faced by each group of lecturers are very different.

The most fundamental difference lies between private university lecturers and state university lecturers. Even within state universities themselves, there are various institutional characteristics and employment statuses that produce different income systems. Therefore, a policy that is appropriate for one group of lecturers is not necessarily a solution for another.

For private university lecturers, the polemic regarding salary amounts at state universities does not actually change much. Their income does not follow the civil servant pay system but depends entirely on the policies of the foundation or university where they serve. The campus’s ability to pay salaries is the main factor determining the welfare of its lecturers.

Unlike state universities, the main problem faced by many private universities is not the lecturer pay system, but the ability to maintain the institution’s financial sustainability. Students are the main source of income for private universities. When competition to recruit new students becomes increasingly tight, the university’s ability to finance operations, including paying lecturers, is affected.

On one hand, a number of state universities continue to expand student admission capacity through various selection pathways and the opening of new classes. This condition further narrows the share of prospective students who have been the main source of income for many private universities. The consequence is clear: when the number of students declines, university income also decreases. The campus’s ability to pay lecturers, improve facilities, and enhance the quality of academic services is also pressured. Therefore, no matter how large the demand for salary increases for state university lecturers, it will not have a direct impact on the welfare of private university lecturers. The problems they face are rooted differently.

Because the root of the problem is different, the solution for private universities cannot be equated with demands for adjusting state university lecturer salaries. A more realistic option is to encourage the consolidation of several private universities to form institutions with more efficient economies of scale, to reorganise the expansion of student admissions at state universities so that competition is healthier, or to provide government funding support to strengthen the operational sustainability of private universities. However, this last alternative still faces obstacles in the form of limited government fiscal space and various policy implications that need to be considered.

In contrast to private universities, the discussion regarding the welfare of state university lecturers is actually much more complex. This group is not a homogeneous group. Some lecturers work at state universities with work unit status, while others are at state universities with legal entity status. In terms of employment, there are lecturers with civil servant status, government employees with work agreements, permanent non-civil servant lecturers, and non-permanent lecturers. Additionally, there are lecturers who have obtained lecturer certification and those who have not. All these combinations produce different income structures.

Therefore, the term ‘lecturer’s salary’ is often misleading because what a lecturer receives each month actually does not only consist of a basic salary. Beyond the basic salary, there are various other components such as performance allowances, professional allowances or lecturer certification, and remuneration. In many universities, it is precisely these components that make the largest contribution to a lecturer’s total income.

So why is the basic salary made relatively small? The answer relates to how an organisation manages its finances and encourages employee performance. From a financial management perspective, universities do not receive income evenly every month. Large receipts generally occur when students register at the beginning of the semester. After that period, cash flow tends to slow down, while various operational obligations must still be met. If most employee costs were charged in the form of a large fixed salary, the university would have to provide the same amount of funds every month regardless of revenue conditions. As a result, the cash flow managed by the state university could be negative at certain points, impacting services to students.

This is why many organisations, whether universities, hospitals, or private companies, prefer to maintain the proportion of basic salary at a certain level and supplement it with various forms of incentives and remuneration. Such a scheme provides greater room for institutions to maintain financial sustainability without sacrificing employee welfare. The second reason relates to the performance management system. Universities today are no longer assessed solely on teaching activities. A university’s reputation is also determined by productivity.