Low Employment Participation, The Importance Of Reform To Reduce The Burden Of The State Budget

Illustration. (Photo: Doc. Antara)

"If everyone asks for a contribution from the state budget, it will be difficult. So it means, we are all improving this. (Social security program)," he said at the Social Security Summit 2024, Tuesday, November 26.

Therefore, Sudarto said that the Ministry of Finance continues to strive to reform the pension system in accordance with the mandate of Law no. 4/2023 concerning the Development and Strengthening of the Financial Sector (UU P2SK).

However, Sudarto admitted that this effort would not be easy because it had to involve all relevant Ministries/Institutions.

"It looks quite heavy because it will involve all the joints of our lives," he said.

On the other hand, Sudarto said that the current number of Indonesian workers is around 145 million. Where only 14 million pension guarantee participants and 16 million old-age security participants.

"This is our concern, don't let friends retire to get social assistance. What does that mean? Burden the state budget," he explained.

In addition, Sudarto also discussed the phenomenon of sandwich generation, where according to him it is not ideal for a continuous productive generation to support the life of an unproductive generation.

He emphasized that currently there are pension guarantees and old age guarantees that can support life for generations who are no longer actively working.

Sudarto revealed that the number of active BPJS Employment participants currently only reached 41.56 million people. This figure shows that not all formal workers are registered as BPJS Ketenagakerjaan participants.

"Active participants in 2023 are only 41.56 million where our workers are formally informal approaching 150 million. These 41 are not sufficient for all formal workers," he explained.