PRIVATE DEVELOPERS SUPPORT ONE MILLION HOUSES PROGRAM by Fardah

Jakarta, June 25, 2015(Antara) - The government's plan to build some one million houses for people belonging to the low-income group has received significant support from the private sector and ministries.

       Three ministries - the Home Affairs Ministry, the Public Works and Housing Ministry, and the Agrarian and Layout Ministry - signed a memorandum of understanding (MoU) to support the pro-people program on June 9, 2015.

       The MoU was inked to support the government's program that was officially launched by President Joko Widodo (Jokowi) in April, 2015, in Ungaran, Central Java, Home Affairs Minister Tjahjo Kumolo stated while addressing the signing ceremony.    

   The Home Affairs Ministry will function to facilitate the development of houses for civil servants through cooperation with regional administrations for activities including land clearing, selection of locations, and simplification of the licensing procedures, he explained.

        "The program to build one million units of low-cost houses in 2015 will be financed with funding from the state budget for 334 thousand units and non-state budget funds for 666 thousand units," he revealed.

       Low-income people including fishermen, workers, civil servants, police, and military members are entitled to get the houses.

       "Implementation of the program will involve developers including the Real Estate Indonesia (REI), and state lenders BTN and Bank Negara Indonesia (BNI)," Kumolo noted.

       The developers have lauded the government's pro-people program.

       "REI can see that the government is more serious in giving higher priority to building houses for low-income people," REI Chairman Eddy Hussy noted.

       In a meeting with President Jokowi on June 23, 2015,  Eddy Hussy stated that REI supports the government¿s One Million Houses Program and will build 247 thousand houses.

       The association conveyed a number of suggestions to Jokowi regarding housing construction to support the government's One Million Houses program.

        It suggested that the procedures to obtain housing construction licenses be reduced to 10 stages only.

       The housing developers also suggested allowing foreigners ownership of houses or apartments in Indonesia.      
   REI has also asked the government to review the policy of allowing one group to possess not more than 400 hectares of land in a province.

        Moreover, the association urged the government to provide supporting infrastructure for the construction of low-cost housing projects in new areas.

        "We need infrastructure development in new areas to develop 1 million homes that will be built for people in the low-income group," Eddy Hussy said.

        Currently, there are many new land areas for constructing houses but lack supporting infrastructure, he noted.

        The REI urged the government to demarcate specific zones for lands that will be used to build low-cost housing projects.

        "The taxable value of property (NJOP) in the special zone has been determined and set, so that there is no increase in the price of land," he claimed.

         Regarding BI's policy that will ease the loan-to-value (LTV) ratio for property, Hussy remarked that the policy will help to accelerate growth in the property sector following the slowdown in housing loans (KPR) and apartment ownership loans (KPA).

       Public Works and Public Housing Minister Basuki Hadimuldjono, who accompanied the president during the meeting with REI chairman, said the head of state has asked the suggestions to be followed up.

       "This subject of foreign ownership is being discussed by the government, by the Finance Ministry in particular. Providing them residential permits after they buy property in the country is also being considered," the minister noted.

         Besides, the president might permit ownership of more than 400 hectares of land on the condition that the housing project should be realized immediately, the minister explained.

         President Jokowi also urged regional governments to simplify and reduce the number of procedures involved in obtaining housing construction licenses from the current 20 to 40 stages to only 10.

        The One Million Houses Program, which is implemented this year, will also be supported by the Social Security Administration Body for Manpower (BPJS Ketenagakerjaan) which has planned to implement a housing construction program for workers in the industrial area.

       "We are ready to build houses for workers in the industrial area," BPJS Manpower President Director Elvyn G. Masassya stated.

       According to Masassya, President Jokowi lauded the program and planned to discuss it in a closed-door meeting.

        In addition to housing, the BPJS Ketenagakerjaan will build modest rental apartments (Rusunawa) for low-income workers.

        "The Rusunawa will be built in six locations including West Java, Jabodetabek, Central Java, East Java, and South Sulawesi, among others," he said.

        Total funds, amounting to Rp360 billion, have been set aside for building Rusunawa.

        President Jokowi earlier stated that he will utilize the Social Security Administration Body's funds worth Rp180 trillion to support a housing construction program for workers.

       Unfortunately, only five percent of the funds can be invested in the housing sector. Therefore, the regulation that restricts the use of funds will need to be revised.

        The president will revise the rule in a bid to increase investment up to 50 percent for housing construction.

      The president assessed that a significant part of the Social Security Administration Body's funds can be allocated to the productive sectors.

       "However, it must be ensured that the utilization of funds should be controlled by good management," the president affirmed.

       The One Million Houses Program is part of Nawacita, or the nine priorities of the Jokowi administration.   ***4***
(T.F001/A/BESSR/F. Assegaf) 25-06-2015 12:08:35