Representatives of tripartite constituents from seven selected regencies and municipalities of East Kalimantan gathered to examine and discuss about the promotion of certainty, adequacy, coverage, and sustainability of old age income security system in a three-day provincial consultation held from 14-16 August.

Attended by 25 representatives of tripartite constituents, the consultation meeting concluded with the signing of a joint statement producing a set of recommendations for policy reform on old age income security system.

The joint statement proposes the establishment of a mandatory universal pension scheme for all citizens, except wage earners. It also proposes the coverage expansion of existing pension scheme to non-wage workers, and the old age benefits scheme by making it a voluntary scheme for all citizens.

The joint statement recommends the increasing of pension contribution rate to 5 percent with a contribution composition between employers and workers of 3 percent and 2 percent respectively. Pension benefits will be increased to 40 percent and to be paid periodically until death after 20 years of contribution.

The joint statement also recommends an increase rate of the contribution and benefit for old-age scheme to 8.7 percent with a contribution composition between employers and workers of 5.7 percent and 3 percent respectively. Benefit for universal pension scheme has been set at Rp 1 million to be paid monthly until death with pensionable age of 60 years old.

Officially opened by the Head of Manpower Office of East Kalimantan, Rozani Erawadi, the consultation meeting discussed current states of elderly's social and economic conditions, old-age income security system in Indonesia, international standards and practices, and direction of reform policy.

Representing the ILO, Christianus Panjaitan as the Project Officer for Social Protection Programme, presented international standards and practices of old-age income security programmes, challenges of existing system in Indonesia and options for policy reform.

Elda Pardede, a population and labour economist from University of Indonesia, provided insights about the aging population. “Considering Indonesia is now entering the aging population, we urgently need to reform our pension system to address old age income gaps between men and women, formal and informal and urban and rural areas,” Elda said.

The ILO support was provided by its Promoting and Building Social Protection in Indonesia Phase 4 programme. Funded by the Ministry of Health, Labour and Welfare of the Government of Japan, the programme focuses on creating conditions to gradually build comprehensive sustainable social protection systems for all by enhancing the expansion of the system coverage to all workers (both in formal and informal economy).