No hike in minimum wage: Theo

JAKARTA (JP): The government decided yesterday not to raise monthly minimum wages throughout the country despite last minute pleas for a 20-percent increase from labor leaders.

Minister of Manpower Theo L. Sambuaga announced the decision yesterday after he chaired a meeting of representatives of the All-Indonesia Workers Union (SPSI), the Indonesian Employers Association (Apindo) and the Manpower Ministry.

During the tripartite meeting, the SPSI leadership initially insisted that wages be raised, but they later became split. According to deputy chairman Wilhelmus Bokha, chairman Datoek Bagindo and secretary-general Hisbuldin eventually endorsed the decision, even though other leaders were still demanding the raise.

Theo promised that the tripartite institution would reconvene and raise wages once there were signs that the Indonesian economy was recovering.

With the announcement and the high inflation rate, the government has failed to reach last year's target of bringing the average minimum wage level to what is officially perceived as meeting basic needs.

An average increase of 10.07 percent in April last year brought the minimum wage to 95.32 percent of the target, compared to 92.49 percent in 1996.

The inflation rate last year was 17 percent, while the rate for the last three months is expected to be about 20 percent.

Currently the minimum monthly wage for a worker in the Greater Jakarta Area is Rp 172,500.

Batam has the highest minimum wage level at Rp 235,000, reflecting the high cost of living there. Yogyakarta has the lowest minimum wage level at Rp 106,500.

Bokha decried yesterday the decision not to raise the minimum wage saying it would cause greater suffering for workers.

He also said the decision had not been made in a democratic manner because it had not been endorsed by all participants in the meeting.

"We are deeply concerned about the decision and how it was reached," he said.

Bokha said he could not understand why Datoek Bagindo and Hisbuldin finally signed the decision while the SPSI presidium of leaders did not endorse it.

Bokha, who is known for his outspokenness, predicted the decision was "an erroneous one at the start of a ministerial career" and that it would make Theo unpopular not only with workers but the public as well.

He said despite the monetary crisis, most companies would have been able to comply had the government decided to raise wages. In addition, financially troubled companies were already allowed not to provide a raise.

He cited how minimum wages in the plantation sector had been raised 16 percent, while wages in the textile sector had risen 16 percent to 20 percent, in the cigarette, tobacco, beverage and food sector 13 percent to 18 percent and in the electronic sector 40 percent.

Both Apindo chairman Hadi Suratno and Datoek Bagindo were not available for comment yesterday.

Apindo deputy chairman Thamrin, who also attended yesterday's meeting, hailed the announcement, saying it would help the country's business sector survive the economic crisis.

"To me, maintaining the business world's survival is far more important than monthly minimum wages," he said.

He, however, urged large and export-oriented companies not badly affected by the monetary crisis to raise their workers' minimum wages.

"Most large and export-oriented companies have no difficulties in raising their workers' wages. They should take the initiative to bargain with workers and raise their minimum wage levels," he said. (rms)