Indonesia: Govt issues new regulation for belabored preemployment card

The government on Wednesday issued a new regulation for its flagship incentivized training program to close loopholes in the previous regulation that prompted public criticism of systemic irregularities and conflicts of interest.

The newly issued Presidential Regulation (Perpres) No. 76/2020 on the preemployment card allows the program management to demand that ineligible participants return the financial assistance (incentives) in full within 60 days. The management may also file criminal charges against ineligible participants that used falsified personal data in applying to the program.

The regulation clearly stipulates that the program is eligible to laid-off workers, furloughed employees and micro and small business owners. It also regulates the conditions for the program’s offline training courses.

It further clarifies that the appointment of online training platforms as program partners and third-party training institutions is not a “procurement of goods and services”, but “still takes into account the purpose, principles and ethics of the state procurement of goods and services”.

The new regulation is not retroactive, and stipulates that all decisions taken by the program management under the previous Perpres are “legitimate, as long as they were taken with good intentions”. The program’s Job Creation Committee is then required to evaluate the decisions.

The provision is applicable to the appointment of partnering platforms and third-party training institutions, among other things. 

The Perpres also restructures and expands the Job Creation Committee that oversees the program, which originally consisted of six members led by the coordinating economic minister and the presidential chief of staff.

The new committee has 12 members comprising the state secretary and six ministers: the home, finance, education, manpower, industry and national development planning ministers. The five remaining committee members are the Cabinet secretary, the attorney general, the National Police chief, as well as the heads of the Development Finance Comptroller (BPKP) and the National Procurement Agency (LKPP).

The preemployment card program had drawn widespread public criticism over the apparent lack of transparency since it was launched on March 20, with an aim to provide a safety net to workers affected by the health crisis. The two key criticisms were that the appointment of online partners through a nontransparent process left it open to conflicts of interest, and that it did not comply with the prevailing regulation on the procurement of goods and services.

“We welcome suggestions from all parties, including [top] institutions like the KPK, and we have received many inputs from the public, including the [people] who are eligible for the preemployment card,” program director Denni Purbasari said on June 22.

Earlier in June, the Corruption Eradication Commission (KPK) uncovered irregularities in the program, including a potential for conflicts of interest and a risk of mistargeting.

The KPK found potential conflicts of interest in at least 250 courses provided by third-party institutions that had ties to partnering platforms. For instance, partnering platform Pintaria offered 199 courses, one-third of which was provided by its parent education technology company HarukaEdu.

By the end of June, the program was offering 3,805 courses through eight partnering platforms, including e-commerce giants Tokopedia and Bukalapak.

“It should not be like this because it weakens the [course] curation,” KPK corruption prevention deputy Pahala Nainggolan said on June 19.

Director Denni said at the time that the program management had issued a public call for expressions of interest and that 19 firms had responded.

The preemployment card was one of Jokowi’s reelection campaign promises and originally designed as an upskilling and reskilling program. As the global health crisis started impacting the economy and led to job losses when companies downsized in response, the government redesigned it into an incentivized training program as part of its COVID-19 safety net strategy.

The reworked program offers participants Rp 1 million in “coupons” to be spent on training courses, and a Rp 2.4 million cash assistance to be disbursed over four months upon completing the program. The program targets 5.6 million affected workers and small business owners, and has a Rp 20 trillion (US$1.3 billion) budget for this year.

In the nearly four months since it was rolled out, the program has registered 680,918 participants, more than half of whom had been laid off as a result of the health crisis.