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Indonesia’s public housing savings rule sparks criticism as it seeks to cover more workers, including foreigners

BP Tapera commissioner Heru Pudyo Nugroho said the changes are part of the government’s effort to “enhance the effectiveness and accountability of Public Housing Savings management”.

He said participants contribute to the fund over a specified period and receive their savings with interest at the end of their participation, reported news outlet Kumparan.

Workers may stop participating in BP Tapera when they retire or die, according to its website. Independent workers and freelancers may pull out at the age of 58. Workers may also stop contributing if they do not meet the participation criteria for five consecutive years.

BP Tapera helps improve lower-income groups’ access to housing through various financing schemes – loans with below-market interest rates for home ownership, home building and renovation, for example.

Those with monthly incomes below IDR8 million are eligible for Tapera help; in Papua province, the income threshold is IDR10 million. 

Through the House Financing Liquidity Facility, BP Tapera also funds the building of homes by the Ministry of Public Works and Housing. As of May 8, the facility has funded the development of nearly 73,000 housing units across over 8,000 housing estates in the archipelago, according to BP Tapera’s website.

Prices of the homes vary based on location and developer. In Java (except Jakarta, Bogor, Depok, Tangerang and Bekasi) and Sumatra (except Riau Islands, Bangka Belitung and Mentawai Islands), for instance, costs start from IDR166 million, according to the Decree of the Minister of Public Works and Housing issued in 2023.

This year, about IDR 9.083 trillion (US$562 million) will be used to subsidise housing for low-income citizens, stated the website.

Mr Eko said BP Tapera aims to register 13 million workers as participants by this year.

Under the new regulation, all employers must register their workers with BP Tapera by 2027, seven years after the regulation was enacted in 2020. 

As of December 18, 2023, total assets managed by the Tapera conventional fund, derived from 3.07 million participants, was IDR7.23 trillion.

BP Tapera’s fund management is supervised by the Tapera Committee, the Financial Services Authority, and the Supreme Audit Agency.

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