The Jakarta Post
The government aims to boost homeownership in Indonesia through its public housing savings program (Tapera), which requires employers and workers to contribute to a mortgage loan scheme similar to universal healthcare insurance. However, some employers and workers have said the program will be an added burden.
Public Works and Housing Ministry Infrastructure Financing Director General Eko Djoeli Heripoerwanto said recently that Tapera would help provide funds for first-time homebuyers and increase the homeownership rate.
"Our target is to help 11 million new homeowners to purchase homes. To achieve this, the government must provide funds [via Tapera] to 5 million households," he told a virtual press briefing on June 5.
The government has laid out a goal to increase the homeownership rate to 70 percent, from the current 56.7 percent, in the 2020-2024 National Medium-Term Development Plan (RPJMN).
Eko said the ministry had provided mortgage loan (KPR) subsidies for 950,000 housing units from 2015 to 2019, and hoped to boost homeownership funding through Tapera.
“We can’t always rely on our limited state-budget [APBN], and Tapera could provide funding to increase [homeownership],” he said.
President Joko “Jokowi” Widodo signed Government Regulation (PP) No. 25/2020 on Tapera on May 20, which provides instructions for fund management body BP Tapera and makes membership compulsory for all workers.
The regulation requires participants to make a monthly deposit equal to 3 percent of the employee’s monthly salary, which is split between the employer and employee for private sector workers, with the employee paying 2.5 percent and the employer paying 0.5 percent.
Both workers and employers have opposed the newly signed regulation, which they describe as redundant and burdening.
Indonesian Employers Association (Apindo) chairman Hariyadi Sukamdani said the government should instead utilize the existing social security program, the Workers Social Security Agency (BPJS Ketenagakerjaan), which already has a legal basis for helping to fund homeownership.
“We already have old-age benefits [JHT] that are included in BPJS Ketenagakerjaan that could be used to purchase homes. Why do we need another program that requires us to pay even more, when we already have a similar program?” Hariyadi told The Jakarta Post in an interview.
BPJS Ketenagakerjaan participants can withdraw 30 percent of their JHT balance to purchase a house or 10 percent of their balance for other necessities, according to PP No. 46/2015 on the national social security system.
Timboel Siregar, the secretary-general of the Indonesian All Workers Organization’s (OPSI), complained that the benefits of Tapera could only be used by low-income participants (MBR) while other participants were prohibited from withdrawing their balance until they reached the pension age of 58 years old.
“If we take a look at the program, all workers are obliged to pay premiums, but the benefits are only for MBR. Even though our money is being kept and invested, the Tapera regulation does not guarantee a good return on their investment,” Timboel told the Post in a separate interview.
Public policy expert from the University of Indonesia, Agus Pambagio, also weighed in on the issue, urging the government to focus on solving land ownership issues that had caused housing prices to jump.
“Most of our residential areas are controlled by a small group of calo [middleman] who treat land as a commodity, driving up prices. We should fix the system first,” he told the Post.
Furthermore, he said the government should also evaluate Tapera’s preceding agency, the Housing Savings Advisory Board for Civil Servants (Bapertarum-PNS), before moving forward with Tapera as the former agency had been plagued with issues.
BP Tapera is set to replace Bapertarum-PNS, with the latter expected to hand over its assets totaling Rp 12.3 trillion (US$861 million) to the former. The government has injected Rp 2.5 trillion into BP Tapera so far.
Bapertarum-PNS has a total of 6.7 million participants, both active civil servants and retirees.
“We frequently saw budget shortages when the participants wanted to use their benefits, so they usually also applied for an additional loan from a bank. The government should examine the failures of Bapertarum,” Agus said.
Responding to the growing criticism, BP Tapera commissioner Adi Setianto told journalists during a press conference on June 5 that participation from higher-income households was needed to provide long-term funds for MBR. Participants could still enjoy their benefits in the form of invested funds, he added.
“We need to have a spirit of gotong royong [mutual assistance] from higher-earning participants in order to provide long-term funding for the program that will benefit low-income workers,” said Adi.
In addition, Adi said Tapera was benchmarking its mortgage rates with the Housing Financing Liquidity Facility (FLPP), which provides a fixed interest rate of 5 percent for 20 years, way below the normal rate used in the BPJS Ketenagakerjaan scheme.
“The difference between BPJS Ketenagakerjaan’s mortgage benefits and Tapera is that we use the FLPP rate, which is lower than the commercial rate the BPJS uses,” he said.
Eko said the FLPP program would also be gradually integrated with Tapera when the agency was fully operational.
Private companies are given a seven-year deadline to register their workers in Tapera. BP Tapera will focus on the program transfer of FLPP and managing the transfer of participants from Bapertaperum-PNS until 2021, before expanding membership to state-owned enterprises, regional-owned enterprises, the Indonesian Military and the National Police in 2022. “By 2024, we hope BP Tapera will be a world-class and credible institution,” Adi said.
BP Tapera has appointed state-owned Bank Rakyat Indonesia (BRI) as the custodian bank for the funds. The agency also appointed five investment managers, comprising both private and state-owned financial institutions.