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Aides take blame as Jokowi retracts pension fund rule

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Indonesian President Joko ‘Jokowi’ Widodo has backtracked on a newly issued pension fund regulation. THE JAKARTA POST

Aides take blame as Jokowi retracts pension fund rule

Indonesian President Joko ‘Jokowi’ Widodo’s aides have been taking the blame after he backtracked on a newly issued controversial pension fund regulation, as labour groups and politicians within his grand coalition delivered a strong backlash.

Jokowi has postponed the ceremonial launch of the unemployment benefits programme (JKP), which was scheduled to kick off on February 22, amid strong criticism that has poured in over a recently issued regulation on the pension fund program (JHT) for workers.

Minister of Manpower Ida Fauziyah signed in early February a ministerial regulation that would allow workers to claim their pension funds when they reach 56 years of age. It is a significant change from the previous regulation enacted in 2015 that set no age threshold but stipulated that any pension fund would only be disbursed a month after the worker had been laid off or resigned.

The new regulation will come into effect on May 4, but has been met with widespread opposition from labour groups and politicians, both within and outside the government coalition.

House speaker and politician of the ruling Indonesian Democratic Party of Struggle (PDI-P) Puan Maharani has criticised the government for being insensitive to the current circumstances, saying the new regulation would only make things more difficult for workers amid mass layoffs during the Covid-19 pandemic.

“The JHT is not a fund from the government; it is the rights of workers because it comes from a collection of salary deductions,” she said on February 14.

Responding to the criticism, minister Ida said that the regulation was issued because, as a special social security net, the JKP would provide layoff benefits. The JKP, which aims to provide cash for workers who are laid off before turning 56, was billed as a substitute for the JHT through the controversial 2020 Job Creation Law, which still needs to undergo revision following a Constitutional Court order.

Coordinating Economic Minister Airlangga Hartarto also said that JHT participants would receive greater accumulated benefits and contributions with the implementation of the new regulation once they reached the retirement age.

A day prior to the planned JKP launch, Jokowi held a meeting with Airlangga and Ida, in which the president ordered both of his aides to simplify the procedures and requirements needed to cash out the pension fund.

“The president has paid close attention to the aspirations and understands protests from workers,” Cabinet secretary Pratikno said after the meeting.

“The arrangements will be further regulated in the revision of the Manpower Minister Regulation or other regulations.”

Officials from the Ministry of Manpower and the Presidential Palace have dismissed claims that the new regulation had been issued without Jokowi’s approval.

Expert staffer of Deputy III at the Executive Office of the President, Fadjar Dwi Wishnuwardhani, said that Jokowi was aware of the content of the ministry regulation and instructed his aides to revise it after receiving aspirations from workers.

“He basically asked for this regulation to be simplified in order to facilitate the process of taking [the JHT],” said Fadjar as quoted by Tempo.

Political communication analyst Kunto Andi Wibowo noted that Jokowi’s backpedalling on the new regulation could serve as a political move that boosts public trust in him.



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