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Jakarta Post

Electricity trade unions oppose omnibus bill revisions over privatization concerns

  • Norman Harsono

    The Jakarta Post

Jakarta   /   Tue, July 14, 2020   /   02:49 pm
Electricity trade unions oppose omnibus bill revisions over privatization concerns PLN Workers’ Association (SP PLN) union leader Abrar Ali (seated, front center) and Indonesia Power Workers’ Union (PP Indonesia Power) secretary general Andy Wijaya (seated, front right) give a press conference on July 9. (Courtesy of SP PLN/-)

Major electricity industry trade unions are considering public protests and strikes to opposite revisions to the 2009 Electrification Law in the controversial omnibus bill on job creation, mainly over concerns that the country’s electricity supply chain will be privatized.

The unions are particularly opposed to the addition of Article 10 (2) and Article 11 (1) to the omnibus bill, which appear to give more room for private enterprises to enter Indonesia’s electricity industry. Article 11 (1) of the bill states that electricity for the public interest can be provided by state enterprises, municipally owned firms, private enterprises, cooperatives and the community.

Under existing regulations, private entities can only act as power producers, which entails building power plants, while state-owned electricity firm PLN has a monopoly on the transmission, distribution and sale of electricity, which involves the construction of significant amounts of electricity infrastructure.

The union’s most prominent association, the PLN Workers’ Association (SP PLN), is planning to coordinate fellow power unions in resistance the bill, said union leader Abrar Ali.

“That [resistance] can be in the form of public protest or a work strike,” he told reporters during an online conference on July 9.

The omnibus bill on job creation seeks to revise 79 laws simultaneously, including the 2009 Electricification Law. It supporters say it will boost investment, cut red tape and make it easier to do business in Indonesia.

Lawmakers have said the bill’s ultimate aim is to create more job opportunities, but civil society organizations and trade unions have contested the bill over a myriad of issues related to transparency, labor rights and environmental protection, among other concerns.

The electricity trade unions issued a formal statement on on July 9, signed by six organizations, including SP PLN, the Indonesia Power Workers’ Union (PP Indonesia Power) and the Pembangkit Jawa Bali Workers’ Union (SP PJB). 

The latter two unions represent workers under two of Indonesia’s largest power producers, Indonesia Power and Pembangkit Jawa Bali, both of which are PLN subsidiaries.

The unions criticized the lack of transparency in the bill’s deliberation, as well as its apparent effort to centralize power.

The two contested articles were originally added to the 2009 Electrification Law but were declared unconstitutional by the Constitutional Court in 2015. SP PLN filed the lawsuit.

“The way we see it, lawmakers are revising a zombie article,” said PP Indonesia Power secretary general Andy Wijaya.

He added that the unions’ respective companies, as state-owned businesses, were powerless to oppose government wishes, and therefore, the unions had not had talks with their boards of directors.

“PLN’s management is more of an executor. They cannot do anything. But we know there is disquiet,” he said.

The Energy and Mineral Resources (ESDM) Ministry directorate for electricity, which has overseen the drafting of the omnibus bill’s electricity-related revisions, declined to comment on the unions’ privatization concerns.

“The bill is currently being discussed with the House [of Representatives] in relation to the problem inventory list [DIM] and has not yet [been discussed] with the Energy Ministry,” ministry secretary general Munir Ahmad told The Jakarta Post on Monday.

Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan said on June 2 that the government was expecting the House of Representatives to conclude deliberation on the omnibus bill on job creation in July and that the government expected the bill, if passed, to speed up Indonesia’s economic recovery.

The government previously delayed deliberation on the labor-related provisions of the bill following strong objections from members of the public, especially workers’ organizations.