BANKING & FINANCEr

Colin Bloodworth
has worked as a financ~alconsultant In Indonesia slnce 1992. He is Dlrector o f PPI Indonesia and can be contacted a t
colin.hloodwoh@ppi-advisory.com or +62 I1 3004 8024

PERSONAL FINANCEEMPLOYEE WELLBEING - CAN YOUR
STAFF (OR YOU! AFFORD TO RETIRE?
One aspect of CSR is t h econsideration t h a t should
be given t o t h e welfare ofemployees, This entails ensuringthat they enjoy a safe andpleasant working environment
and that they receive pay andbenefits that allow them to enjoy

provided for in the labour laws was a'pesangon' consisting of a lump sum
relating to the number of years worked.
Where employers were concerned aretired employee was now out of sightand out of mind.

to cover the liability of laying staff off,
never mind providingfortheir retirement. I
don't know how many times I have read in
the press of workers arriving on a Monday
morning to find factory gates locked andthat the owners had disappeared.

f ~ s o m progressehas been madeI was appointed to the committee ofnsion scheme. However, unless thefi

any years the actual pensia small one. Whatever tn.Sj~dis
him as a driver who had worked for an oilcompany I was with in Jakm some 20

Protecat say

wife were now desfamily to help theand a little money
then checked with mynd they confirmed hepreaflng a pansionthat Is the case inampany
n rismngof whom had cornple

Scheme were the envy of the world, but
the world was different then; people

worked until 65 and died just a few years
later. Today, people are living into theireighties and this puts huge pressures on
the working force. In lndonesia people havemore family support to compensate but
even that is diminishingwith urbanisation.
No doubt a few trillion Rupiah could befreed up if the remaining fuel subsidy were
removed but there are other priorities suchas education and infrastructure.
lndonesia is not alone with its budget
deficits. The US, UK and most ofcontinental Europe are struggling to makeends meet. British pensioners who havechosen to live in lndonesia are victims ofan unusual form of discrimination in that
their state pensions are frozen from thetime they leave the UK, even though they
have completed their full contributions
during their working lives. This applies
to pensioners in 123 countries, including
Australia and Canada, but those living inother countries enjoy annual increments
in line with those living in the UK. There isreportedly a lady living in Australia who istoday receiving a pension of six pounds aweek, the same amount as when she left
the UK in the 1970's. There is an actiongroup addressing this and a branch exists
in Bali. If you would like to support it, I canprovide the contact details.

50 w h t is the solution?
Since with the best will in the world neither
governments nor employers can provide alevel of benefits that would provide people
with a decent standard of living in old age,what can bedone? Employers may not havethe financial means to solve the problem
but they can take a proactive approach byassisting and educating employees so thatthey can help themselves.

behind in the UK would be well-advised
to consider transferring them offshore toa QROPS while the facility is still available.
Most people seriously underestimate howmuch they will require in retirement. Whatif you have left it too late to save? There
are some measures left such as clearing
debt, delaying retirement or working parttime, trading down a property for a smaller
one and so on. But prevention is always
better than cure.

Where local employees are concerned they

appening take action now
n employer or manager,,@# &?$y to spread theave *eir

who called.&-,.. -.*- - .,*.OM~-I$$$&-,-. ~ . . e ~ ~ ~ F w ~ M