Improving Economy, Government Ask Entrepreneurs Not To Pay THR

Illustrations (Irfan Meidianto / VOI)

JAKARTA - Indonesia's economy is slowly improving towards recovery, after previously contracting quite deeply in the second and third quarters of 2020. For this reason, entrepreneurs are asked not to pay in installments the holiday allowance (THR) this year.

Coordinating Minister for the Economy Airlangga Hartarto is confident that the Indonesian economy will be able to grow better this year. This is in line with several projections of international institutions.

The World Bank, OECD, ADB and IMF project Indonesia's growth to be in the range of 4.4 percent to 4.9 percent in 2021 and 4.8 percent to 6.0 percent in 2022.

Meanwhile, the Indonesian government estimates that the national economy will grow in the range of 4.5 percent to 5.3 percent in 2021.

This growth is inseparable from the support of the National Economic Recovery Program (PEN) which continues to be pushed to strengthen the purchasing power (demand) and production (supply) sides.

To encourage economic growth, said Airlangga, the government will also accelerate the mass vaccination program, strengthen the implementation of the Job Creation Law, and expand the implementation of Micro PPKM.

Airlangga has met a number of businessmen who are members of the Indonesian Chamber of Commerce and Industry (Kadin). In front of these entrepreneurs, Airlangga asked to pay the Lebaran THR for workers in full this year.

"Last year the THR was paid in installments, I ask this year to be paid in full. We have to commit," he said through a formal statement quoted on Saturday, April 3.

The former Minister of Industry considered that this was necessary because the government had issued various incentives for business actors in the midst of the COVID-19 pandemic. Therefore, entrepreneurs are expected to be able to make good use of these incentives. Moreover, the economy started to slowly improve.

The Ministry of Manpower issues regulations

Menaker Ida Fauziyah said he would issue a regulation to ensure companies pay THR Lebaran 2021 for their workers.

"We have formulated a wage policy during the economic recovery period due to COVID-19, such as the provision of allowances for religious holidays in 2021," said Ida at the Hearing Meeting (RDP) with Commission IX DPR RI, Tuesday, March 16.

However, Ida has not yet set a payment method. Meanwhile in 2020, THR will be paid in installments due to the COVID-19 pandemic situation which caused the national economy to contract quite deeply.

"We will complete Permenaker No. 6/2016 on Religious Holiday Allowances (THR)," he explained.

KSPI asked THR to ask for installments

Previously, the President of the Confederation of Indonesian Workers Unions (KSPI) Said Iqbal asked that the holiday allowance (THR) be paid 100 percent and not in installments. He said this was in accordance with the government's statement which said the economy had improved.

If the THR is paid in installments, Iqbal said, the purchasing power of the workers will be even worse. Moreover, the government has stopped the government for subsidizing salaries or wages.

"If the THR is paid in installments or not 100 percent, the purchasing power of workers will be further hit in the midst of the corona pandemic as a result of being laid off and paid a level wage," Said said in a written statement, Wednesday, March 17.

Iqbal said that if the purchasing power of workers decreases it will also result in a decrease in public consumption. Meanwhile, there are still increases in the prices of staple goods ahead of the fasting month and Eid.

Therefore, Iqbal considered that there must be a balance and a sense of justice between the interests of workers and employers. Moreover, entrepreneurs have also received economic stimulus and tax breaks from the government. So, simultaneously the THR and labor wages must be paid in full, not in installments so that consumption will increase so that economic growth also increases.

"Not in installments so that consumption will increase so that economic growth will also increase," he explained.