Indonesia: Government in partnership talks with more start-ups amid preemployment card controversy

• Apr 23, 2020

The government is in talks with four start-ups to forge partnerships for the preemployment card program as it wants to add more online courses despite recent backlash over the program’s partner selection process and courses.

The program management’s president director, Denni Purbasari, said adding new partners was intended to encourage more start-ups to grow. It was expected to take four to eight weeks to evaluate whether a company was suitable to be a partner in the program.

“I believe competition will promote innovation, it will push the price to be competitive and encourage more training institutions to partner with the program,” Denni said in an online briefing on Wednesday. “There will be more options for small training institutions to work with the partners.”

In providing online courses to help the participants upskill and reskill themselves, the government currently partners with eight start-ups, including Skill Academy, which is owned by e-learning platform Ruangguru, Pintaria and MauBelajarApa. The participants will use the money transferred to their e-wallet to pick and purchase any training they need.

However, the pre-employment card, which is aimed mainly at offering relief for laid-off workers and owners of small businesses hit hard by the COVID-19 outbreak, has been subject to criticism. The public accused the management of a conflict of interest for partnering with a start-up linked to an expert staff member of President Joko “Jokowi” Widodo.

In response to the controversy, the expert staffer in question, Adamas Belva Devara, who is also the CEO of Ruangguru, resigned on Tuesday, despite explaining that he had not been involved in any partnership discussion or the appointment of Ruangguru as a partner in the program.

Denni admitted that there was no open selection process prior to the existing partners’ appointments. Her office chose the start-ups because they had a national network, the necessary information and technology capacity, suitable courses and partnerships with training institutions, among other things.

Furthermore, the program management had held consultations with tech companies, researchers, labor unions, the Indonesian Chamber of Commerce and Industry (Kadin), the Indonesian Employers Association (Apindo) and representatives from more than 50 companies before the appointments, according to Denni.

“Ruangguru’s core business is selling courses, and it is big,” said Denni, who previously served as the Executive Office of the President’s economic advisor. “We cannot ignore this fact.”

Aside from Skill Academy, the program management is also partnering with a government agency and six other companies, including e-commerce firms Bukalapak and Tokopedia, to provide more than 1,500 courses.

Following its launch on April 11, the preemployment card has attracted more than 7.6 million applicants as of Wednesday. With Rp 20 trillion (US$1.2 billion) in allocated funds, the program aims to cover 5.6 million recipients this year. Only 168,111 participants were admitted in the first phase, while the rest would be admitted in later ones.

Under the program, each recipient will get Rp 3.5 million worth of benefit, which will be disbursed in stages. To ensure they take the online courses, the program management will first disburse Rp 1 million to each recipient to pay for courses. After completing the training, the recipients will get Rp 600,000 in monthly benefits for four months on top of a Rp 150,000 incentive for participating in job surveys.

Office of Coordinating Economic Minister secretary Susiwijono Moegiarso said the preemployment card was the only government aid targeted to support laid-off and furloughed workers in both the formal and the informal sector as well as the owners of small businesses.

“The number of applicants has reached 7.6 million in just 12 days, reflecting the public’s extraordinary response,” Susi said in the same online briefing on Wednesday. “On the other hand, we are also empathizing with the many people in need of the assistance.”

Denni said the program was also preparing to accommodate hundreds of thousands of youth entering the workforce in June as they finished senior high school but did not immediately move on to college. They might struggle to find a job as the economy was taking a downturn due to the outbreak.

According to data updated on Monday by the Manpower Ministry, as many as 2.2 million workers reported that the outbreak had affected their jobs. More than half of them were formal-sector workers furloughed by 43,690 companies.

“Laying off is an emergency measure when no other measures are feasible,” Manpower Minister Ida Fauziyah was quoted as saying in a statement released on Wednesday. “But we are encouraging firms to try measures such as eliminating overtime, reducing working hours or furloughing workers in turn while paying them half.”

Source: https://www.thejakartapost.com/news/2020/04/23/government-in-partnership-talks-with-more-start-ups-amid-preemployment-card-controversy.html