REFORMING CIVIL SERVANT PENSION (PNS) PROGRAMS IN INDONESIA: AN INSTITUTIONAL APPROACH ANALYSIS

There are two objectives of the Civil Servants (PNS) Pension reform in Indonesia such as to improve the pension benefits of civil servants and to reduce the fiscal burden for pension budget spending in the long term. The implication is to observe the current and an alternative system based on good governance in national and international experience. As a result, there is a need to conduct an explorative study which regard to the existing legislation and institutional in Indonesia and various international experiences in some leading countries for conducting pension reform . The method of writing this paper uses qualitative descriptive analysis. The primary data was collected by conducting interviews and focus group discussions (FGD) and secondary data based on literature studies to obtain lesson learnt which provide on national and international papers, important data and documents especially the current legislation and government legal drafting (RPP). As a background of analysis, this paper presents an introduction and a regulatory framework. The contents of the introduction are the problems and the choices of solutions for PNS pension plans in Indonesia. Whereas a regulatory framework presents a series regulatory reforms to promote social security including private and public pension program and possibility for its implementations. Explorative reform on pension program is learning on the experience of various foreign countries including Chile, Australia and several Asean countries. In short, there is momentum to reform civil servant (PNS) program pension in Indonesia. This momentum indicated by decreasing replacement rate and and increasing budget spending on pension funding which its ratio is relatively still low to total gross domestic product (GDP) . As a result, there is a need an institutional approach analysis on pension reform in PNS pension program based on development on regulatory framework as a legal basis a new governing body managed PNS pension fund professionally.