Observer: Giving THR To Civil Servants, National Army And National Police Does Not Significantly Boost Purchasing Power

Illustration. (Photo: Doc. Antara)

JAKARTA - The government has decided to provide holiday allowances (THR) for Civil Servants, National Army, and National Police this year. The disbursement will be carried out on H-10 before Eid Al-Fitr. By providing THR faster than private workers who do the 7 days before Eid, the government hopes that there will be better purchasing power.

Responding to this, Indonesia's Center of Reform on Economics (CORE) Senior Economist Piter Abdullah said that the national economy slumped during the pandemic not entirely due to the loss of purchasing power.

"Some of the lower class, especially those affected by layoffs, have experienced a decrease in purchasing power. But civil servants, military, and police are in the upper groups. So, their income is not much affected," he said when contacted by VOI, Tuesday, April 20.

The provision of (THR) for Civil Servants, National Army, and National Police can indeed encourage consumption, but not much. But, said Piter, it will ultimately help the economy survive the pandemic.

Likewise, Executive Director of Indef Tauhid Ahmad said that giving (THR) for Civil Servants, National Army, and National Police did not significantly increase purchasing power. Because the number is only 4 million people.

"It will raise the purchasing power when we add private officers, farmers, fishermen, and so on and their numbers are much higher. So even though there is (encouraging purchasing power) it is relatively small," he said.

Tauhid warned that THR should not be given to Civil Servants, National Army, and National Police instead of being saved, not consumed. Moreover, they do not allow them to go out of town, including being prohibited from going hometown in 2021.

"If you save again, it will not have an impact on the economy. What we are worried about is that giving THR savings is not consumed, because they are not going hometown. Currently, they are also not doing shopping like last year's Eid, not going hometown, not shopping for clothes, even if there is an expense for consumption, it is not much," he said.