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Thousands protest against Indonesia’s plan to take from workers’ pay to fund a national housing program

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Thousands of workers in Indonesia have rallied in front of the Presidential Palace in Jakarta to protest a new plan to take from their salaries to support a national housing scheme.

The Public Housing Savings Program, known in Indonesia as Tapera, was brought in late last month by outgoing President Joko Widodo.

Under the policy, all workers on at least a minimum wage have to contribute 2.5 per cent of their salary from 2027. Ilhamsyah, leader of the United Confederation of Indonesian Labour party, told ABC they are demanding the government retract Tapera.A group of houses shot from birdview.He said the compulsory savings program reflected the government’s “failure to provide an appropriate living space” for civil servants, military personnel, and police among other workers.

Ilhamsyah added it would “punish the working class” especially if there were penalties for not contributing. At least 11 labour and other organisations were expected to attend the protest, while Indonesian police said they were deploying at least 1,600 personnel.A group of people holding colorful flags on the street.What is the new housing scheme?
Under the new policy, all workers on at least a minimum wage must contribute 2.5 per cent of their monthly income, with employers pitching in an additional 0.5 per cent towards the housing savings program.

Previously, only full-time government workers had to contribute. The government said the value of people’s money would “multiply”, but didn’t elaborate on how.

Workers will be able to access the funds when they buy a property. If they don’t buy a property or already have a property, they can withdraw the funds when they turn 58 or retire.

However, a large part of the country won’t be subject to the policy because as many as 47.1 per cent of Indonesia’s workforce β€” or about 24.8 million people β€” are earning less than the minimum wage, according to 2023 official data.

The average minimum wage also varies between about $200 to $500 per month depending on the province.
The new policy has triggered anger among workers, particularly those who were already struggling with the rising costs of living. Source: ABC

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