Jakarta. The mandatory home savings program for salaried employees isn't a new concept. In fact, several countries, including neighboring Malaysia and Singapore, have adopted similar policies, a Public Works and Housing Ministry official said on Sunday.

The government has issued a law mandating that salaried employees save 3 percent of their take-home pay to obtain loans for buying new homes or renovating their primary residences.

The law has drawn protests from employers who are required to contribute 0.5 percent to the mandatory savings, known locally as Tapera.

"There are many countries that have already adopted similar programs. The closest to us are Singapore, which introduced the Central Provident Fund, and Malaysia, with the Employees Provident Fund -- both of which collect funds from employees and employers," said Herry Trisaputra Zuna, the ministry’s director general of infrastructure financing.

Herry said the public home savings fund aims to tackle the backlog of 36 million houses in Indonesia.

“This figure includes 9.9 million new houses for citizens who don’t have permanent residences and 26 million houses that don’t meet the statutory minimum standards for housing,” he said.

Participants in the home savings program are entitled to receive a Rp 4 million subsidy for the down payment on a house purchase, he said.

The fund will be managed by a special body named BP Tapera, whose main tasks are to address the national housing backlog and provide affordable home loans.

Last year, the ministry built 229,000 new houses for low-income families using the state budget. However, the number is expected to decline to 167,000 this year due to budget constraints.

“Once the public home savings program collects a substantial amount of funds, it will be able to tackle the huge backlog in public housing with support from the state budget,” Herry said.