TREND ANALYSIS OF PENSION FUNDS IN INDONESIA FOR PERIOD 2012-2016

Abstract

Pension Fund is one of most important issue that faced by developing countries including in
Indonesia. This research investigates Indonesia Pension Fund condition within 2012-2016 to
know what are the phenomenon and critical issue that need attention. The analysis performed
using comparison method for each factor through descriptive analysis based on quantitative
data from OJK (Financial Services Authority). The results show that participation rate of
Pension Fund still low compared to total productive age populations below 7%. On portfolio
and performance perspectives, most of the Pension Fund shows stagnancy both on portfolio
development that dominated by deposit and saving (26%) and ROI performance below 10%.
Redemption methodology preference changes from monthly redemption to lump sum
redemption that indicates Pension Fund’ challenges on cash flow management in future.
Based on stated conditions and challenge, more employer starting to switch its employee’s
Pension Fund program to third parties-based Pension Fund which managed by financial
institution. This research provides better understanding of Indonesia Pension Fund condition
by relating number of participant to total managed asset that reflected on portfolio proportion
and investing strategy that results better ROI. Furthermore, redemption methods also become
important to paid attention of from Pension Fund management in future