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Workers misunderstand old-age risk scheme, says expert

Social security expert Bambang Purwoko expressed his deep concern over workers and lawmakers who protested Government Regulation No

Ridwan Max Sijabat (The Jakarta Post)
Jakarta
Fri, July 3, 2015

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Workers misunderstand old-age risk scheme, says expert

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ocial security expert Bambang Purwoko expressed his deep concern over workers and lawmakers who protested Government Regulation No. 46/2015 on the withdrawal of old-age risk scheme funds, saying protesters did not understand the law and the old-age risk program benefits in the social security context.

'€œThe President abides by Law No. 40/2004 on national social security systems, which allows workers to withdraw the old-age risk scheme funds only after at least a 10-year premium contribution to the program. According to chapters 35 and 37, it can be withdrawn after 10 years of paying premiums,'€ he told The Jakarta Post in Jakarta on Friday.

Lawmakers should not protest the regulation but, instead, give a good understanding to all stakeholders, especially workers, of the regulation and the program'€™s philosophy.

'€œThe old-age risk [JHT] and pension programs are designed to protect workers upon entering retirement age. The JHT benefit will be paid in a lump sum while the pension benefit will be received on a monthly basis. Of course, the funds belong to workers and they have their right to take it but if the funds are withdrawn far before their retirement, they will be left unprotected and this is against the law,'€ he said.

A great number of workers and lawmakers have filed a petition to protest the new government regulation'€™s issuance after finding that the JHT funds could no longer be withdrawn after five years of enrolment as was allowed by the 1992 Social Security Law under the old social security programs.

Bambang, also a professor of social security studies at the University of Indonesia and Pancasila University, said the Workers'€™ Social Security Management Agency (BPJS TK) could face financial problems and its current additional programs like affordable housing and flats for workers would be under threat if workers were allowed to withdraw the social security funds earlier.

'€œLike banks, the BPJS TK could face a rush,'€ he said.

He added the BPJS TK'€™s strength lay in the management of huge funds collected from workers and their employers under the JHT and pension programs.

The BPJS TK'€™s assets have reached Rp 170 trillion (US$12.76 billion), a large part of which are JHT funds that will be paid to workers in due course, in accordance with the regulation. (++++)

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