JAKARTA – The Ministry of Public Works and Ministry of Public Housing are said to be supposedly split into two separate entities in order to optimise the effort to lower housing backlog. Within the past nine years, the government is deemed inefficient in bridging the supply and demand of public housing.

Panangian Simanungkalit, Executive Director of Panangian School of Property (SPS), said the reason behind the split of Ministries of Public Works and Public Housing refers to the increased backlog of housing that has reached 12.7 million. “It could be concluded that there needs to be a ministry that accommodate and coordinate with five other related ministries. It is for land mapping, so that the housings built in one town does not contribute into oversupply,” he explained in Jakarta yesterday (26/10).

According to Simanungkalit, a separate Public Housing Ministry will coordinate the policy to create a balance between the number of demand and supply of housings. The housing issue needs interlocking policies, including policies of bank’s interest rate, subsidy, and power of purchase of consumers, adjusted with the tenor of instalment. “So, the focus of a ministry is vital in managing this,” he added.

As of now, Simanungkalit mentioned that the supply and demand for housings are no longer balanced. The demand is there, but the supply is low, making the price no longer affordable, especially for low-income communities. On the other hand, emerged a mindset or a lifestyle, particularly in millennials, that no longer sees house ownership as an absolute need.

“It is a mindset that is not aligned well with the 1945 Constitution of Indonesia, in which the government aims to create prosperous society,” Simanungkalit mentioned.

According to Simanungkalit, the emerging mindset of not having a house in millennials is a reflection of their frustration towards increasingly high house price. If it continues, there will come a time when a generation does not have an asset, which will, in turn, create a wide social gap in the next 10 years.

It is said that the government must play a definitive role in providing housing needs for Indonesian masses. The mindset of not having a house as an asset should not be encouraged. “If this backlog is seen as a problem of high demand, the government may solve this issue with various schemes, including the extension of House Ownership Credit tenor according to the people’s capability,” Simanungkalit explained further.

Prior to 2014, Ministry of Public Works and Public Housing were two separate institutions with their own functions and authorities. (LK/ZH)