Management of Jamsostek

Management of Jamsostek

From Kompas

It is amazing that with virtually no capital to speak of at its establishment three or four years ago, PT Jamsostek (the state-owned social security company) has collected funds amounting to Rp 5.3 trillion. Its profit in the same period is a fantastic Rp 476 billion.

Jamsostek has deposited Rp 2 trillion with government banks earning interest of 14 percent p.a., while it has entrusted another Rp 1 trillion to Bank Tabungan Negara, also a state bank, according to Kompas, Dec. 5, 1997.

PT Jamsostek's objective is the welfare of its members, its funds should therefore be managed by a cooperative or a foundation. I would prefer a cooperative so that cooperatives are given a boost. Besides, the Ministry of Cooperatives can act as advisor.

Jamsostek is a limited liability company. Such a company tends to seek the greatest possible profit. Jamsostek having large profits is wrong because it means that compensation for its members, in the form of allowances in cases of accident, for health care, old age and death, is too small because most of the profit goes to the company.

What is referred to as members' welfare is not adequately fulfilled, especially if the company has a problem like now. In order to determine an equitable amount for allowances, the company should learn from advanced countries. Moreover, it should recruit honest and capable managers.

W. HADI SOEWIRJO

Pati, Central Java