Govt to subsidize wages with Rp 8.8t, but business wanted more

The Indonesian government has announced a wage subsidy to help employers weather a period of tightened restrictions to prevent COVID-19 infections, but the scheme falls far short of what business associations have demanded.

Finance Minister Sri Mulyani Indrawati said the government would subsidize wages to the tune of Rp 500,000 (US$ 34.50) per worker per month. The program will run for two months, so that each employee will get Rp 1 million, which is to be transferred in a single payment by state-owned banks directly to the employees.

The subsidy will only apply to workers who are on a monthly salary of less than Rp 3.5 million, are registered with the Workers Social Security Agency (BPJS Ketenagakerjaan) as of June 2021 and work in nonessential industries in areas with level 4 public activity restrictions (PPKM).



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