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Social Protection is the Right Step to Increase People’s Purchasing Power


By: Savira Ayu)*

The government has strengthened several social protection programs for the public in order to increase purchasing power in the midst of global inflation. One of them is the distribution of Wage Subsidy Assistance (BSU) for workers which immediately received a lot of appreciation by various parties.

In 2022, the Government will again provide Salary/Wage Subsidy Assistance (BSU). The distribution of this assistance will be carried out through the Ministry of Manpower (Kemenaker). It is known as a direct statement from Ida Fauziyah as the Minister of Manpower that the provision of BSU promoted by the Government is aimed at providing protection to workers and also of course accelerating national economic recovery.

It is hoped that later after all BSUs are distributed by the Government to these workers/laborers, it will be able to increase people’s purchasing power so that the wheels of the Indonesian economy will soon turn again after the Covid-19 pandemic. Of course, it cannot be denied that the impact of the pandemic even now is still quite pronounced, especially in terms of the economy.

It could even happen that inflation continues to suppress people’s purchasing power during the holy month of Ramadan like now until the momentum of Hari Raya later. So, as directed by President Joko Widodo, the government must immediately strengthen social protection.

This reduction in people’s purchasing power is a real phenomenon. Even some chicken and beef traders in Bengkulu admit that their merchandise since entering the month of Ramadan seems to be getting less demand. Of course, it’s not only because the price of meat has gone up, but also the prices of other basic necessities have gone up at the same time.

Economic issues are not only exacerbated by the pandemic, but world political sentiments are currently experiencing tension when the conflict between Russia and Ukraine begins to roll. This even directly affects the creation of inflation on a global scale. This causes the prices of some basic commodities to skyrocket and put more pressure on our economic recovery.

Therefore, you can imagine what would happen if the Government did not immediately take action in the form of providing BSU assistance. Of course, with people’s purchasing power decreasing day by day, it will also have a big impact on the wheels of the national economy as a whole.

The Minister of Manpower Ida further explained that the criteria for receiving BSU in 2022 are currently only given to workers/laborers whose salaries are below Rp. 3.5 million. They will each receive Rp 1 million in assistance from the funds allocated by the Government with a total amount of Rp 8.8 trillion.

To ensure that assistance can be distributed to the community quickly, precisely, accurately and accountably, the Minister of Manpower is still working on the entire mechanism for granting the 2022 BSU. Regarding the maturation of all mechanisms related to the distribution of BSU, all of them were directly instructed by President Joko Widodo.

The appreciation immediately flowed to the Government of Indonesia, which was considered immediately alert and very concerned about its people. Piter Abdullah as Economist from the Center of Reform on Economics (CORE) stated that with many basic commodity prices that are still soaring as of now, it is very appropriate to take action by the Government to provide BSU to workers with these criteria.

Similarly, the appreciation was also given by Puan Maharani as Chair of the DPR RI. For him, the commitment from the Government to provide assistance to workers whose salaries are below Rp. 3.5 million is very appropriate. According to him, of course with the BSU provided by the government, the community will be relieved of the burden of their economic difficulties.

The social protection policy that is currently being rolled out by the Government is the right step to maintain people’s purchasing power. All parties are expected to be wise and work hand in hand to support the Government so that the current difficult situation can be resolved immediately.

)* The author is a contributor to Pertiwi Institute

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