14. Expanding Social Security in Indonesia: The Current Processes and Challenges

This chapter reviews social security development in Indonesia, which has evolved from providing very little in its early years, to a system that benefited only formal sector workers, to universal coverage. There are two important milestones in this development. First, starting in the mid-1960s, the New Order government gradually developed various social security schemes, albeit limited to the formal sector. Second, after the Asian financial crisis towards the end of the 1990s, a stronger social security system was established by adopting legislation for universal coverage. The challenges for implementing it, however, remain formidable due to Indonesia’s vast geography, large population and diversity in availability and quality of infrastructure.