1. Institutional Setting of Poverty Reduction/Social Protection Programs in Indonesia

Vita Febriany

The SMERU Research Institutewww.smeru.or.id

2. Institutional Issues on CCT Program

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Programs Related to Poverty Reduction

Sector Number of

Programs

Number of Executing Agencies

Budget (million

US$)

Political, Law and Security

15 9 500

Economic related programs

69 12 4,000

Social welfare 33 11 2,500

Total 117 32 7,000

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Ministerial Task Force (TKPK)

• Launched in 2005 • A cross-sectors forum • Expected to accommodate all efforts to reduce

poverty• Consisting of:

• 19 ministers • 3 head of bureau and• other non-governmental members

• Chair: Coordinating Minister of People’s Welfare• TKPK offices are also established at provincial and

district level

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Under TPKP framework, since 2008, all programs dealing with poverty reduction have been coordinated into 3 clusters of program

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Cluster I Cluster II Cluster III

Social Assistance

Aim: to reduce economic cost burden of the poor

Community EmpowermentAim: to increase the poor’s income & affordability

Micro-enterprises EmpowermentAim: to increase savings & business sustainability of SMEs

Main Instruments:Rice for the poor, Health Card, CCT, scholarship for the poor.Other Instruments:Social assistance for disabled, elderly, children, etc.Targets in 2009:18.5 million the near poor, poor, and very poor households.

Main Instruments:PNPM Mandiri (National Community Empowerment Program) PPK, P2KP, PPIP, PISEW, etc.

Targets in 2009:6,408 villages

Main Instruments:Credit for the People (KUR)

Targets in 2009:US$ 2 billion for 4 million microcredit recipients

“Giving a fish” “Train how to fish” “Provide fishing rod and boat”

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The Drawback of TKPK (Ministerial Task Force)

• Poor coordination across ministries• Most ministers are from different political parties

and interest groups• Conveying diverse poverty alleviation and agenda• Bureaucratic fragmentation • Financial limitations• Weak deciding power

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Special Task force

• In Mid 2010 TKPK changed its name into the national team for poverty reduction acceleration (TNP2K).

• Three main tasks: • To formulate the poverty reduction policy and program, • To make the poverty reduction activities more synergic between

ministries and institutions, • To perform the monitoring and evaluation function.

• Led directly by the Vice President• The office is next to the Vice President office• Vice President checks the progress in every two weeks

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Head : Vice PresidentDeputy I : Coordinating Minister of People’s WelfareDeputy II : Coordinating Minister of Economic Affairs

Members

Executive Secretary:Welfare Affairs Deputy of Vice President Secretary

Cluster 1:Household based Integrated

Social Assistance(Vice President Office)

Cluster 2:Community Empowerment based Social Assistance /

PNPM Mandiri(Coordinating Ministry of

People’s Welfare)

Cluster 3:Micro-enterprises

Empowerment based Social Assistance

(Coordinating Ministry of Economic Affairs)

Institutional Issues on CCT program

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CCT program in Indonesia

• Known as Family of Hope Program (PKH).• Implemented since 2007.• Transferring funds directly to women.• Employing 12 health and education

indicators.• In 2010 covers around 800,000 poor

households.

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Institutional Issues of PKH

• At central government: between ministries

• Between central and local governments

• At village level

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Between Ministries

• PKH is a demand driven program.• Managed by The Ministry of Social Affairs (MoSA)• Inter-sectors coordination is provided by a central

coordinating team• MoSA is considered as lack of credibility compared

to other ministries• Difficult to ensure other ministries' support and

commitment

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Between Central and Local Governments

• PKH is a central government program.• Indonesia is a very decentralized country with

autonomy lies at the district government. • PKH has been implemented only at selected

districts. • There is an MOU between central and district

governments. • Low level of local governments’ commitment

(‘business as usual’).• District health and education offices follow strategies

from their line ministries and local government policy.

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At village level

• Service providers at the village level follow policies at the district level.

• Lack of information at services providers• Extra burden no additional compensation• Resulted in the virtual absence of compliance

monitoring.

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PKH Institutional Interrelationship

Health Office

Education Office

Social Affairs Office

District Government

Health clinics SchoolsField Facilitators

Ministry of Social AffairsMinistry of Health

Ministry of Education

Central

District

Village

MOU