SOE Streamlining: Danantara Guarantees No Layoffs, Eyes Rp50 Trillion Annual Savings

The Danantara Investment Management Agency has confirmed that no layoffs (PHK) will occur during the ongoing streamlining of state-owned enterprises (BUMN). Chief Operating Officer Dony Oskaria stated that all employees will be retained and integrated into the consolidated companies as part of efforts to improve efficiency and corporate performance. The agency is currently working to reduce the number of SOE entities from 1,077 to between 200 and 300, with the process targeted for completion by 2026. According to Dony, President Prabowo Subianto has directed that the transformation of SOEs must not harm workers. “The President certainly does not want any layoffs,” he said. The streamlining is driven by the need to address the high number of inefficient and loss-making companies; approximately 52 percent of the current 1,077 entities are recording losses, with accumulated losses reaching Rp20 trillion. Despite this, Danantara opted to retain the entire workforce after calculating the financial impact of consolidation. Dony explained that the savings generated from the consolidation process far exceed the cost of keeping all employees. “We calculated the annual labour costs of the companies we are streamlining. It turns out it is only Rp2–3 trillion,” he said. “So I thought, if I take all the employees, I still save Rp47 trillion.” He stressed that no staff will be reduced during the restructuring, and all employees will be transferred to the newly merged companies. “We will not reduce any employees. They will all become part of the consolidated companies. Our thinking is we do not want to wrong the employees, because it is not their fault,” he stated. Beyond guaranteeing no layoffs, Dony revealed that the SOE streamlining programme could generate direct savings of up to Rp50 trillion annually. He noted that current practices often involve multi-layered transactions between holding companies, subsidiaries, and sub-subsidiaries, which create significant inefficiencies.