UNS – The economist of Universitas Sebelas Maret (UNS) Surakarta, Lukman Hakim, Ph.D., rejects the discourse of the dissolution of the Financial Services Authority (OJK), where he considers that doing so will only worsen the condition of the Indonesian economy. “I think the issues related to OJK dissolution does not need to be extended, this could worsen market confidence in our economy condition amid its attempt to survive against this pandemic,” Dr. Lukman Hakim, opined when contacted by uns.ac.id, Thursday (16/7/2020).
In the midst of a vortex a number of figures who support the discourse of the dissolution of the OJK, Dr. Lukman mentions that he prefers the option to improve and enhance the performance of the OJK if it is still lacking. Aside from the discourse, a number of figures for the past few days have also been diligently voicing the pressure that the supervisory function of the financial services sector is returned to Bank Indonesia. However, Dr. Lukman worries that this will lead to weak government control.
“The idea to return the banking supervision from OJK to the Bank Indonesia is also not quite right. Previously it is under the Ministry of Finance within the LPJK (Financial Services Supervisory Agency), now, under the Regulation it becomes OJK. If today, the monitoring is returned to the Bank Indonesia, this means that the government will increasingly have no power to control banks, because the central bank is an independent institution. The Bank Indonesia will be a very powerful institution outside of government authority,” explains Dr. Lukman Hakim.
During the ongoing COVID-19 pandemic the position and role of OJK are crucial especially regarding its relationship with BI. He declares that there is a need for trust and confidence from the community toward these two institutions.
“To face this pandemic, institutions such as OJK and BI must always present in the middle of society, always ready to listen, and find solutions so that it will calm the community. The key during this condition is for the community to be calm, not panic, and believe that the government, in this matter OJK and Bank Indonesia, is working hard in facing this condition,” Dr. Lukman Hakim emphasized.
The chaos of the economic situation due to the Covid-19 pandemic also requires OJK to work extra hard. Even though in its implementation OJK has to face various financial industries, which leads to delays in policy implementation. However, Dr. Lukman considers that the mandate given by the government to OJK in the financial sector has been prepared and carried out carefully.
A number of accurate tricks have also been taken by the OJK to ward off the economic turmoil that will be faced by Indonesia. These include the POJK No. 11/POJK.03/2020 regarding the Economics Stimulus as Countercyclical Policy as the Impact of Coronavirus Disease 2019 Spread in the Banking Industry, and the POJK No. 14/POJK.05/2020 regarding Countercyclical Policy for the Impact of Coronavirus Disease 2019 in Non-Bank Financial Service Institution.
When inquired regarding the relation between the Jiwasraya case with the discourse on the dissolution of the OJK, Dr. Lukman mentions that OJK needs to collaborate with the DPR (House of Representatives) to prepare a strong legal umbrella in the Non-Bank Financial Industry.
“Related to the problems in the insurance industry, I think the regulation in the non-bank financial industry is not as prudent as its counterpart in the banking industry. This due to the various forms of business under this category. Indeed, OJK must accelerate the formulation of regulations for the non-bank financial industry, in partnership with the House of Representative as a legal umbrella in handling problems occurred,” he concluded. Humas UNS
Reporter: Yefta Christopherus AS
Editor: Dwi Hastuti
