Indonesia is a country in which only small part of the population of nearly 220 million is covered by formal systems of social security, and these systems cover only some of the contingencies set out in ILO Conventions. To date, only 17 per cent of working population is covered by employment-linked systems of contributory social insurance. The rest of the population, particularly those who work in the informal economy, when faced with adverse events affecting their livelihood, rely mainly on informal mutual support arrangements based on extended families, local communities and religious groups.
Over years, the ILO has supported the development of social security in Indonesia in terms of policy development for social security system reform, the restructuring of the national social security system (Jaminan Sosial Tenaga Kerja/Jamsostek), and the promotion of “flexicurity” in addressing the adverse impact of labour market flexibility.
The ILO has also published a recent publication on social security, “Social Security in Indonesia: Advancing the Development Agenda”. The publication presents a series of recommendations to improve the existing social security schemes and to develop an effective action plan to implement the national social security system covering key issues in social protection: (i) Implementation of National Social Security (SJSN) Law; (ii) Reform of Jamsostek; (iii) Extension of social security coverage for the informal economy workers; and (iv) Social assistance targeting the poor.