Indonesians Protest MPs’ New $3,075 Housing Allowance Amid Austerity

Hundreds of Indonesians gathered in Jakarta on August 25, 2023, to protest a newly announced monthly housing allowance of 50 million rupiah (approximately $3,075) for Members of Parliament (MPs). This increase comes at a time when the nation is grappling with economic uncertainty and government austerity measures, prompting public outcry over perceived insensitivity.

The housing allowance was unveiled just days after President Prabowo Subianto pledged to implement strict austerity measures during his State of the Nation address on August 15. Many citizens and experts criticized the allowance as excessive, given that it is nearly ten times the minimum wage in Jakarta, Indonesia’s capital.

Following significant discontent expressed on social media, student groups and other organizations mobilized to demonstrate outside the parliament building. Protesters voiced their frustrations over lawmakers’ apparent disconnect from the struggles faced by ordinary citizens. University student Ivan remarked, “It’s really heartbreaking. Many people still earn less than 50,000 rupiah a day. They should see that the condition of Indonesian society right now is dire.”

As the protest intensified, demonstrators attempted to breach barriers set up by the police, sparking a response that included tear gas and water cannons. Another protester, Zico, highlighted an alternative perspective, stating, “Instead of allowances for MPs, the money should be used to increase teachers’ salaries so they can live decently or to create jobs.” Current salaries for teachers in Indonesia range from 1.2 million to 7 million rupiah monthly.

The police managed to contain the protesters approximately 500 meters from the main gate of parliament initially. However, they regrouped and attempted to push through again later in the day, resulting in further clashes. While there were no immediate reports of injuries or arrests, the protests disrupted traffic and public transport across Jakarta and other cities in Indonesia.

Background on the Allowance and Public Reaction

The housing allowance, announced by Adies Kadir, deputy speaker of the House of Representatives, followed questions about potential budget increases for parliament. The House, which consists of 580 members, has not provided official residences for MPs due to deteriorating conditions, leading lawmakers to request a cash allowance instead.

In addition to the housing allowance, MPs are set to receive increases in their rice allowances from 10 million to 12 million rupiah per month and fuel allowances from 5 million to 7 million rupiah. Adies justified the increases by stating, “The finance minister also felt sorry for our fellow MPs,” emphasizing that the adjustments were necessary.

Despite already earning up to 230 million rupiah monthly from various allowances and attendance bonuses, the public backlash was swift and severe. Social media users shared contrasting images of commuters on overcrowded transportation against footage of MPs during the State of the Nation address, leading to the trending hashtag #bubarkanDPR, or “disband the parliament.”

Some lawmakers defended the decision, including singer-turned-MP Sigit Purnomo, who argued that the allowance was “carefully calculated” to meet MPs’ needs while aligning with government finances. Even members of the Indonesian Democratic Party of Struggle (PDI-P), part of the opposition, supported the allowance, asserting that it was appropriate for Jakarta’s living conditions.

Critics, including economist Media Wahyudi Askar from the think tank Center for Economic and Legal Studies (CELIOS), labeled the housing stipend as “irrational,” advocating for the funds to be redirected towards economic stimulus or essential public services. Achmad Nur Hidayat, a lecturer at National Development University, suggested that parliament should reevaluate its pay structure and impose realistic caps on allowances.

Political Implications and Future Considerations

The controversy surrounding the housing allowance follows President Prabowo’s recent commitment to austerity and budget cuts, which he claimed saved 300 trillion rupiah for government programs. Despite promises to reduce the budget deficit, the proposed allowance increase raises questions about the balance between political support and financial responsibility.

Political analysts suggest that the allowance increase may be a strategic move by Prabowo to secure parliamentary support for his ambitious programs, including a free-meal initiative costing taxpayers approximately 335 trillion rupiah annually. Observers like Kunto Adi Wibowo from Padjadjaran University noted, “Parliament was given privileges in the form of higher allowances possibly because Prabowo doesn’t want his programmes vetoed or politically disrupted.”

Experts warn that the backlash over the allowance could complicate future policy decisions. Hendri Satrio from Paramadina University noted the challenge Prabowo faces in retracting the allowance hike given the need for parliamentary support. The public’s vocal objections highlight a growing demand for accountability and transparency regarding lawmakers’ benefits, suggesting that such considerations will play a significant role in future governance.

As the discussions around the housing allowance continue, Indonesians remain vigilant, underscoring the need for their representatives to prioritize the public’s welfare over personal benefits.