Bappenas Analisis Program Sosial

PART FOUR
Social Safety Nets in Indonesia:

Analysis and Prospects*
* The study was based on a paper prepared for ESCAP by Mr Puguh B. Irawan, Social Economist,
Central Board of Statistics; and Mr Erman A. Rahman, Mr Haning Romdiati and Ms Uzair
Suhaimi, National Development Planning Agency (BAPPENAS), Indonesia. The views expressed
are those of the authors only. They do not necessarily reflect the views of the United Nations or
its Secretariat.
Strengthening Policies and Programmes on Social Safety Nets
Social Safety Nets in Indonesia: Analysis and Prospects
I. BACKGROUND
A. Impacts of the 1997 economic crisis
The most severe social impact of the crisis in Indonesia was the worsening of poverty
that, in fact, had improved quite impressively in the two and a half decades preceding the
1997 economic crisis. Between 1976 and 1996, poverty had declined from around 40 per
cent to just over 11 per cent (Table 1). The success of poverty alleviation was coupled with
clear improvements in such areas as education and health. However, the crisis reversed
these developments, raising the number of poor people to 49.5 million by December 1998
from 34.5 million in 1996.
The intensification of poverty was related to several factors: (a) the skyrocketing
prices of basic commodities; (b) the contraction in production resulting in increases in
unemployment; (c) the decline in household income in both urban and rural areas; and (d)
the impact of El Niño.
Since then, however, the number of poor people has fallen from 48.4 million in
February 1999 to 37.5 million in August 1999. This favourable turn of events was greatly
influenced by the deflating prices of food commodities as well as the steady, although slow,
recovery of the economy in general. To a certain extent, it may also have been a positive
effect of social safety net programmes, such as Special Market Operations for Rice (OPK)
and the labour intensive programme.
Notwithstanding the currently improved situation, the Government did not act quickly
enough in responding to the crisis when it erupted. It was stymied by an inadequate
bureaucracy, the absence of early monitoring systems for social concerns, even by the
unavailability of reliable and timely poverty statistics, as well as information on the
identification of the poor. It took some time, at least a full year, before it could mount
meaningful social safety net programmes.
B. Objectives of the study
The present country study has the following objectives:
(a) To assess the adequacy of policy formulation of social safety nets in Indonesia;
(b) To assess the efficacy of social safety net programme implementation; and
(c) To recommend measures to strengthen the responsiveness of social safety net
programmes to short-term emergencies as well as to long-term strategies.
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Table 1. Indonesia: Poverty line, estimated number and percentage

of poor people, 1976-1999
Poverty line Percentage of poor people Number of poor people

(rupiah/capita/m) (Po – Headcount Index) (in millions)
Year
Percentage Absolute
Urban & Urban &
Urban Rural Urban Rural points Urban Rural change
rural rural
change (millions)
1976 4 522 2 849 38.8 40.4 40.1 – 10.0 44.2 54.2 –

1978 4 969 2 981 30.8 33.4 33.3 – 6.8 8.3 38.9 47.2 – 7.0
1980 6 831 4 449 29.0 28.4 28.6 – 4.7 9.5 32.8 42.3 – 4.9
1981 9 777 5 877 28.1 26.5 26.9 – 1.7 9.3 31.3 40.6 – 1.7
1984 13 731 7 746 23.1 21.2 21.6 – 5.2 9.3 25.7 35.0 – 5.6
1987 17 381 10 294 20.1 16.1 17.4 – 4.2 9.7 20.3 30.0 – 5.0
1990 20 614 13 295 16.8 14.3 15.1 – 2.3 9.4 17.8 27.2 – 2.8
1993 27 905 18 244 13.4 13.8 13.7 – 1.4 8.7 17.2 25.9 – 1.3
1996 38 246 27 413 9.7 12.3 11.3 – 2.3 7.2 15.3 22.5 – 3.4
1996a 42 032 31 366 13.6 19.9 17.7 – 9.6 24.9 34.5 –

Dec. 1998 96 959 72 780 21.9 25.7 24.2 6.5 17.6 31.9 49.5 15.0
Feb. 1999 92 409 74 272 19.5 26.1 23.5 – 0.7 15.7 32.7 48.4 – 1.1
(19.4) (26.0) (23.4) (15.6) (32.4) (48.0)
Aug. 1999 89 845 69 420 15.1 20.2 18.2 – 5.3 12.4 25.1 37.5 – 10.9
(15.0) (20.0) (18.0) (12.3) (24.8) (37.1)
Source: Central Bureau of Statistics, 2000, Penyempurnaan Metodologi Penghitungan Penduduk Miskin dan
Profil Kemiskinan 1999
(The revised methodology of counting the poor and poverty profiles 1999).
Note: 1. Figures in brackets are without East Timor.
2. The highlighted figures (1996a-Aug.1999) apply a consistent standard of defining minimum basic
food and non-food in the poverty line.
C. Anti-poverty policies
Long before the crisis, since the early 1970s, poverty alleviation has been one of the
major priorities in Indonesia’s national development strategy, although it was never stated
explicitly in any official document until the early 1990s. Various anti-poverty policies prior
to the crisis in the country were carried out by both the Government and non-governmental
organizations (NGOs), frequently with support in the form of financial assistance from
various donor agencies. The fundamental goal of this anti-poverty strategy was improving
the welfare of the population and reducing the socio-economic gap or inequalities between
sub-groups of the population.
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Table 2. Indonesia: The averaged nominal (and real) expenditure, 1996-1999
(rupiah/capita/month)
URBAN RURAL
Lowest Middle Highest Lowest Middle Highest

40 per 40 per 20 per All 40 per 40 per 20 per All
cent cent cent cent cent cent
1996 46 918 91 576 226 633 100 639 30 552 50 809 100 920 52 696
Dec. 1998 92 790 168 249 387 463 181 809 65 970 109 394 202 463 110 601
(46 713) (84 700) (195 058) (91 527) (33 211) (55 071) (101 924) (55 679)
Feb. 1999 98 907 186 599 419 272 198 056 70 697 115 414 212 261 116 893
(47 753) (90 092) (202 430) (95 624) (34 133) (55 414) (102 482) (56 437)
Aug. 1999 97 369 184 030 430 960 198 701 67 379 112 801 217 919 115 603
(48 672) (91 992) (215 426) (99 325) (33 681) (56 386) (108 932) (57 787)
Percentage change:
1996-Dec. 1998 97.8 83.7 71.0 80.6 115.9 115.3 100.6 109.9
(– 0.4) (– 7.5) (– 13.9) (– 9.1) (8.7) (8.4) (9.9) (5.7)
Dec. 1998- 4.9 9.4 11.2 9.3 2.1 3.1 7.6 4.5
Feb. 1999 (2.2) (6.4) (3.8) (4.5) (2.8) (0.6) (0.5) (1.4)
Feb. 1999- – 1.6 – 1.4 2.8 0.3 – 4.7 – 2.3 2.7 – 1.1
Aug. 1999 1.9) (2.1) (6.4) (3.9) (– 1.3) (1.8) (6.3) (2.4)
Source: Irawan and Romdiati (2000).

Note: Numbers in brackets indicate the values of real expenditure/capita/month after the adjustment of
inflation rates in the respective periods.
Several programmes were implemented as part of the anti-poverty strategy. Among

them, perhaps the most far-reaching, was the massive programme of intensification of rice
cultivation, known by the acronym of Bimas and Inmas. The programme consisted of four
pillars: (a) introduction and dissemination of the Green Revolution technology, (b) distribu-
tion of subsidized agricultural inputs (fertilizer and pesticide), (c) a massive programme of
infrastructure development (irrigation and roads), and (d) a price support scheme operated
by the Food Logistics Agency. This programme accelerated rice production, from an annual
growth rate of 3.7 per cent during the period 1972-1977 to 7.2 per cent during the period
1977-1982. The rapid growth in agricultural production during the 1970s and the early
1980s, in conjunction with the resulting employment creation in off-farm activities from
agricultural processing, transport and trade, was believed to have significantly contributed to
poverty reduction, notably in rural Java.
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The Government also launched direct intervention programmes aimed at alleviating

poverty in 1994. In this effort, it adopted two approaches: geographic targeting and
individual targeting. Geographic targeting is based on the characteristics of regions,
directing the funding to less developed regions (village or sub-district level). Individual
targeting, on the other hand, is based on information about individuals or households, such
as their income (living below the predetermined poverty line) or their social status (the
disadvantaged, etc.), channelling the anti-poverty programme to the lowest-income or
disadvantaged groups. Two of the direct anti-poverty intervention programmes prior to the
crisis were Inpres Desa Tertinggal (IDT), a major geographic targeting programme, and
Pembangunan Kesejahteraan Keluarga (PKK), an individual targeting programme.
The IDT programme, operated during the period 1994-1996, involved block transfers
of an annual 20 to 60 million rupiah per village to around 20,000 poor or less developed
villages (about one third of the villages in the country). It had three complementary
components: (a) roll-over funds for small business, (b) provision of business/activity
advisers, and (c) rural infrastructure development. The funds were allocated specifically to
promote income-generating activities through various economic activities by the poor, and
labour-intensive public works that involved the poor. With regard to a family approach, the
target group of the programme was the poor households in the less developed villages who
were gathered into community groups, which collectively received roll-over working capital
to be used for establishing their members’ own productive enterprises, with the hope of
helping them move out of poverty.
Estimates about the number of poor people reached by IDT varied from 27 to 30 per
cent (Alatas, 1998) to approximately 50 per cent (Molyneaux and Gertler, 1999). There
was, however, a contrary view. Manning (1999:141) argued that the IDT programme was
unlikely to have made much progress toward poverty reduction since the decline of the
incidence of poverty was only 7 per cent during the period 1990-1995.
In relation to individual targeting programmes, the empowerment programme for
family welfare (PKS), implemented in 1995-1996, had two subprogrammes: (a) saving for
family welfare, and (b) business credit for family welfare. The programme provided grants
directly to poor families as classified by the National Family Planning Coordinating Agency
(pre-prosperous family and prosperous family I) in both non-IDT and IDT villages (the first
implementation was only in IDT villages). The main purpose was to train and assist poor
families to develop productive small-scale enterprises in order to enhance family welfare.
It is difficult to make a precise judgement on whether or not the PKS programme
achieved its original goals. Although data published by the Office of the Coordinating
Minister for Welfare and Poverty Alleviation Affairs (1998) show that in mid-1998, the
business credit for family welfare in IDT villages absorbed more credit than the total
amount of funding (131.6 per cent), some data also show that the credits had been invested
in banks with the expectation of making gains from higher interest rates rather than in
directly productive activities.
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D. Social security schemes
The social security schemes, already in existence in Indonesia prior to the crisis,
cover only those working in the formal sector, i.e. people in the Government and in the
private sector. In general, social security benefits for civil servants and armed forces
personnel comprise payment of retirement saving benefit and pension, and health care,
whereas the benefits enjoyed by private and state enterprises’ employees, as covered in
the social security for private sector workers, include employment injury insurance, death
compensation and retirement insurance.
A compulsory health insurance scheme for public servants, first introduced in

1968, provided medical care for active workers, pensioners and their families. By
1991, in an effort to provide better health services, the Government restructured the
scheme. It provided comprehensive medical care to registered members and their
dependents either on capitation, budget or package system under the managed health-
care concept.
A savings and insurance scheme for Government employees established in 1977

provided two benefits: endowment insurance and pension. Endowment insurance
requires civil servants to contribute 3.25 per cent of their salaries to the scheme that
provides a basis for a lump sum payment of over 16 months of the latest salary at
retirement age (56 years) or in the event of death in service. To receive a monthly
pension on retirement, civil servants are also compulsorily required to contribute 4.75
per cent of their wage. By 1999, there were around 1.7 million retirees and around
0.8 million survivors receiving a monthly pension in Indonesia. At the same time, the
pension insurance scheme for government employees covered around 4 million
active civil servants and around 160,000 state companies’ employees throughout
Indonesia. The insurance scheme for Indonesian armed forces personnel also provided
two benefits to the armed forces personnel, endowment insurance and monthly pension,
with the same portions of beneficiaries’ contribution as the one for government
employees.
The social security scheme for private sector employees, established in 1992,
replaced a previous scheme that was first introduced in 1978. It applied to private and
state enterprises with 10 workers or more, or a monthly wage bill of 1 million rupiah.
The scheme provided four benefits: compensation for work accidents, death benefit (term
insurance), old-age benefits (savings withdrawal) and health care.
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II. SELECTED SOCIAL SAFETY NET PROGRAMMES

DURING THE CRISIS
A. Introduction
In an effort to mitigate the adverse impact of the crisis on the poor and the other
groups in the country, the Government launched a number of social safety net programmes
for them. These social safety net programmes can be classified under four major areas of
concern: (a) food security for the poor centred on the distribution of subsidized rice to poor
households; (b) access of the poor to basic social services such as health and education; (c)
access of the poor to income or employment opportunities; and (d) access of the poor to
improved livelihood through small and medium-sized enterprises development.
B. Food subsidy programme
Special Market Operations for Rice (OPK: Operasi Pasar Khusus) was aimed at
assisting food insecure and poor families nationwide to meet their most fundamental needs.
The programme distributed 20 kilograms of rice per family every month at the subsidized
price of 1,000 rupiah per kilogram.1 This was a special programme specifically designed in
the wake of food riots and soaring food prices in mid-1998.
The OPK programme was first launched in the period July 1998-March 1999 and
then was continued in the fiscal years 1999/2000 and 2000. Beneficiaries consisted of
pre-prosperous families and prosperous stage I families. The programme was administered
jointly by the State Ministry of Food and Horticulture and the Food Logistic Agency.
The number of beneficiaries covered in the programme rapidly increased from only
around 142,000 families in the July 1998 pilot test to almost 9.4 million families in
December 1998. The OPK programme continued to expand in December 1999, reaching
over 12.3 million families. The figure in October 2000 shows that the programme had
distributed 162,048 tons of rice, or around 93 per cent of the target, to over 10.4 million
families with an average of 15.5 kilogram/month/family.
The distribution was carried out through some 45,000 distribution points spread over the
country. Payment was in cash, when rice was received by beneficiaries. Later payment,
usually a fortnight after rice was received, was permitted when beneficiaries who were unable
to buy obtained a written guarantee from local authorities. Failure to pay in two weeks caused
the next rice allocation to be postponed until the beneficiary was able to pay his or her debt.
1 In the first six months of its implementation from July to November 1998, the ration was 10 kilograms/
month/family. But since December 1998, the quantity of rice being provided was increased to 20
kilograms/month/family. It is worth noting that the average market price of rice of medium quality was
around 1,800 rupiah/kilogram.
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In financing this large-scale operation in food subsidy, the government spent around
2.7 trillion rupiah (or an estimated 3.4 trillion rupiah at market prices) in the fiscal year
1998/1999.
In terms of disseminating information, the OPK programme was given wide publicity,
i.e. it was “socialized” through the mass media (television, local broadcasting radios and
newspapers); through social, religious and community groups; and through personal contacts
with community leaders. The monitoring of the OPK programme was carried out through
direct monitoring by implementing parties (local government, regional and subregional food
logistics depots and relevant institutions), and through independent evaluation by NGOs and
universities every six months.
The implementation of the OPK programme during the first year of operation was
widely criticized. The criticisms ranged from those directed at the readiness of the
concerned agencies to carry out their tasks, reports of corruption, exclusion of non-resident
poor (who had no identity cards), programme socialization, and probably the most impor-
tant, the method used in determining the target group. Since then, the programme has
subsequently undergone significant design revisions, particularly with regard to geographic
targeting.
Soon after the initial period of implementation, the programme was subjected to a
rapid field appraisal by the Social Monitoring and Early Response Unit (SMERU) (1998).
SMERU carried out an appraisal in 21 urban areas and 19 rural areas in five provinces.
The mission concluded that: (a) the administration of the OPK programme was not
adequately done, partly because of the unavailability (or inadequacy) of an operational
budget; (b) public information and outreach was inconsistent, inaccurate and ineffective; and
(c) the quality of OPK rice was low and medium but in general, programme beneficiaries
found it acceptable. Another drawback of the OPK programme was the lack of operational
mechanisms to distribute cheap rice from distribution points to beneficiaries. This is the
reason why the subsidized rice received by programme participants was less than 10
kilograms. The community had to bear the indirect cost to collect and distribute the rice
from the distribution points to the beneficiary’s households. These costs were generally not
reimbursed by the programme.
SMERU has a more recent evaluation of the OPK programme. The SMERU report
shows that not all OPK beneficiaries were poor, defined as households within the first
quintile of the income spectrum. The target ratio of the OPK programme was 0.9,
indicating that the programme was poorly targeted.2
2 Target ratio is defined as the ratio between the fraction of programme beneficiaries who are non-poor
and the fraction of the overall population who are non-poor, and it ranges from 0 (refers to perfect
targeting) to 1.25 (refers to missed targeting).
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However, a study by the Centre for Food, Nutrition and Agricultural Studies and
Services (CEFNAS) (2000) in the urban areas of West Java, Central Java, East Java,
Yogyakarta, Lampung and South Sulawesi indicates somewhat opposite findings:
• The programme was quite popular, as 97.5 per cent of respondents had heard of
the programme mostly from local task forces;
• OPK beneficiaries were more likely to be families with low social and economic
status, as indicated by the fact that almost three quarters of respondents had per
capita expenditure of less than 300,000 rupiah per month and, on average, spent
over two thirds of their expenditure on food;
• Rice distribution points were generally not far from residential areas of OPK
beneficiaries, as 86 per cent of the beneficiaries travelled less than 1 kilometre to
collect the rice in person;
• The average amount of rice received was 13.32 kg/family/month;
• The rice price purchased by programme beneficiaries was 1,025 rupiah per
kilogram, which was slightly higher than the official price (1,000/kg). This price
was acceptable to most of the beneficiaries as it was still lower than the market
price. However, it was found too high by some 18 per cent of respondents who,
in fact, could not afford it;
• More than 90 per cent of respondents had no complaint about the programme
services; and
• Of the complaints expressed, 47.5 per cent related to the quality of rice, 4.9 per
cent to the quantity, and 7.3 per cent to the price.
Another study (by the Institute for Economic and Social Research and Education)
directed to the rural areas of eight selected provinces that covered about 1,300 sampled
households came up with somewhat different conclusions. The study said that 61 per cent
of all programme beneficiaries were poorly informed about the programme; that the
beneficiary household on average received only 11 kilograms per month at 1,050 rupiah per
kilogram; and that the income transfer of the programme to a beneficiary household was
15,357 rupiah. This study recommended the discontinuation of the OPK programme, unless
it was significantly improved, especially in regard to programme targeting, the distribution
mechanism, programme “socialization” and transparency.
After major revisions in programme design and operation, in response to the

criticisms, the OPK programme proved a remarkable success. Reviewers Tabor and Sawit
(1999) for instance praised the programme for its accomplishments in nearly every
performance area. They concluded that the programme was well-coordinated, well-targeted
and extremely cost-effective, as indicated among other things by: (a) almost 90 per cent
coverage of the total poor population; (b) an 85 per cent ratio of net transfer benefits
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received by target groups to total cost in the fiscal year 1998/1999; and (c) by the estimated
average transfer benefit of around 6,413 rupiah per month per beneficiary, which contributed
6 per cent to the average income of poor households and 9 per cent to the average income
of rural poor households. They also found that the OPK programme created some 72,000
new jobs, contributed to price stability, enhanced consumer comfort, restored law and order,
improved income distribution, and helped sustain the productivity of health and educational
spending.
C. Scholarship and block grants for primary

and secondary schools
Data suggest that Indonesia has achieved great success in improving the education of
its people during the last two and a half decades, especially at the primary and secondary
levels. Nevertheless, the country still faces many problems, recently exacerbated by the
economic crisis. In response to this, the Indonesian government established the stay-in-
school programme, under scholarships and block grants or operational assistance to primary
and secondary schools. This programme provides for scholarships to poor children and
block grants to poor schools. The programme was initiated in 1998, then expanded in the
second and third year of implementation. The coverage of the programme was eligible
children and schools in all provinces in Indonesia. The scholarship programme used
national level data to target poor schools and local knowledge for the selection of individual
participants. The executing agency is the Department of National Education, with the
involvement of national, provincial, district, sub-district and school committees.
The scholarship programme was developed as an effort to prevent a large number of

children from poor families from dropping out of school (at primary, lower and upper
secondary schools) as a consequence of crisis-induced factors. During the crisis, many poor
and near-poor families found it difficult to keep their children in school, as they found their
financial capacity too small relative to the school fees they had to pay. By providing
funding for those children, the Government enabled the poor families to let their children
stay in school.
In addition, the Government, through the stay-in-school programme, extended support

to needy schools, both public and private, that provide services for the poor, to improve the
schools’ ability to manage and maintain the quality of their services. The support consisted
of block grants to primary, secondary and upper high schools.
The programme is planned to continue for a period of five years, with funding to
come from the state budget and loans from the World Bank and the Asian Development
Bank (ADB). The programme will spend a total of 5 trillion rupiah. Already it has
provided scholarships to about 4.3 million students and block grants to approximately
132,000 schools throughout the country.
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As a rescue package, this programme was prepared in a rush, hence, it received much
criticisms, especially in the early implementation stage. In later years, improvements were
pursued on the basis of inputs from: (a) communities, both through complaining and mass
media; (b) internal evaluation from organizations executing the programme; (c) external
evaluation from academic researchers; and (d) recommendations from NGOs. The improved
programme design, along with a good commitment from the executing bodies, brought
about satisfaction and appreciation from donor agencies and other concerned parties. In
1999, the World Bank presented a President’s Award for Excellence to the programme as an
appreciation of the Bank for the programme’s greatly improved performance.
According to the World Bank, there were four criteria used as indicators of the good
performance of social safety nets in education (Info JPS, 2000:4):
• High response in preventing a decreased enrolment rate and quality of education

services, as well as preventing an increased drop-out incidence;
• High cost-effectiveness of the fund since the programme was not funded by a
new loan but by state budgets and a loan from the World Bank and ADB for five
years;
• High innovation since it made a new breakthrough in distributing the fund not
through bureaucratic mechanisms but directly to the school and scholarship
holders through local post offices; and
• The involvement of many institutions, both from government (National Education
Department, Religion Department, Finance Department, National Development
Planning Agency (Bappenas) and PT Pos Indonesia) and international agencies,
such as, the United Nations Children’s Fund (UNICEF), the World Bank, the
Asia-Europe Meetings (ASEM), and the Australian Government’s overseas aid
programme (AusAID), in the planning process and implementation of the
programme.
In general, the problems that faced the social safety net in education were related to
technical implementation and finance. Technical problems included lack of information on
the programme at the community level, low ability and comprehension in programme
implementation, and a lack of reliable indicators for target groups. Financial problems were
related to leakage of the fund and corrupt practices.
One deficiency frequently ignored was the fact that scholarships covered only school
fees and other related expenses. In some instances, the amount was not even enough to
cover the bare educational needs of children from the very poor, as access to schools was a
more pressing problem than that of school fees. Even though poor families could afford to
pay for school fees and other expenses, they could hardly afford to pay for the transporta-
tion costs, especially for those with children who were at lower and upper secondary
schools, because these schools were often located at a distant away from their places of
residence.
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D. Programmes in the health sector
The social safety net programme in the health sector is the JPS-BK programme. This
has the objective of helping poor families maintain their health and nutritional status which
may have deteriorated as a consequence of crisis-induced factors. In operation since early
1998, the JPS-BK programme extends basic health and reproductive health services and a
system of referrals to poor families, provided by community health centres and their
networks, including village midwives. The programme maintains and improves the
nutritional status of pregnant women, children under two, post-partum women, as well as
babies of poor families.
The selection of the target group is based on a combination of the National Family
Planning Coordinating Agency’s list of PKS and Prosperous I families, and local criteria
determined by village teams which consist of village midwives, the health section of village
community councils, the village community reliance institutions, with assistance from the
Family Planning Field Officer.
To receive assistance, poor families selected into the programme were given a health
card for seeking medical assistance and care from community health centres or other health
facilities. The selected families were eligible to receive medical assistance for one fiscal
year and for the following fiscal year if they were selected again.
Based on the report covering the period from January to October 2000, the social
safety net programme in the health sector has given health cards to around 10 million poor
families, or 92 per cent of the target, of which almost 39 per cent utilized health services,
including nearly 20 per cent who made cumulative visits. In May 2000, the coverage of
pregnant mothers, birth-delivering mothers and post-natal mothers receiving basic midwifery
services was 71 per cent, 49 per cent and 44 per cent of the targets, respectively. Under
the programme, every person received 10,000 rupiah for basic health services for the whole
year. With that amount of money, it is very hard to get decent health services for the
whole year.
The social safety net in health was financed mainly by the state budget and two loan
projects from ADB. The total budget allocated to the programme was around 1,043 billion
rupiah for fiscal year 1998/1999 and was 1,030.4 billion rupiah during fiscal year 1999/
2000. Details of fund allocation and absorption are shown in annex III.
Both the fund for poor families and the fund for food and nutrition surveillance of
the Health Security for the Community were distributed through post offices and regional
offices of the Treasury.
Several independent studies on the performance of social safety net programmes in

health have pointed to some apparent problems, including: (a) mis-targeting, (b) non-
availability of data on prospective beneficiaries, (c) inconsistency of data, (d) administrative
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problems arising from the fact that many poor families living in urban slums did not hold
identity cards and thus were not eligible to receive benefits, (e) the tendency for late
distribution of funding to community health centres and village midwives, and (f) a lack of
socialization between beneficiaries and programme implementors at local levels.
Naturally, these problems have been, and continue to be, addressed by the programme
implementors. In particular, much attention has been directed towards solving the
mis-targeting problem. Efforts in this area have been aimed at collecting more data about
populations of target villages, removing inconsistencies in the existing data, and extracting
more information from data currently available. Administrative problems are also being
addressed.
E. Supplementary food for primary school students
Since mid-1996, Indonesia has undertaken a national school-feeding programme to

provide supplementary food for primary school students, of both public and private schools.
In the first year of implementation, the programme was operated only in Java and Bali. By
the second year, it was expanded to include all poor villages throughout Indonesia. During
the crisis, the programme was further expanded and placed under the umbrella of social
safety nets in health.
The supplementary food programme is a multi-sectoral programme. Because of this,

many parties are involved in its administration, including the National Education
Department, Internal Affairs, Agriculture, Health, and Religion and the community. These
institutions work together at all administrative levels from national to village level.
The objective of the programme is to improve the status of nutrition and health
among primary school children by providing them with food supplements and enhancing the
schools’ capability for delivering nutrition and health services to their constituents. For
school children, the aims of the programme are: (a) reducing absenteeism, (b) alleviating
short-term hunger, (c) increasing total energy, (d) educating children on topics of health and
nutrition, and (e) reducing worm infection rates. For the schools, the programme attempts
to improve the knowledge of teachers on teaching health and nutrition topics. Parents and
the community itself are not left out. The programme offers them knowledge and
involvement in children’s health and nutrition.
Generally, the programme provides a nutritional snack three times weekly, and in
some schools, up to four times weekly. The supplemental foods are given to the children in
the form of locally available and prepared snacks. The use of local material in snacks is
intended to support the development of the local economy and involve the local community
(including school administrators and parents) in managing the programme. By involving all
elements potentially concerned with children’s education, the implementation of the
programme becomes the responsibility of government, parents and community together.
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On the whole, the targeting of the programme seems to have been accurate. The
target group is all students at primary schools, including those at Islamic religious schools
in the IDT villages across the country. Another target group is the community, especially
students’ parents and teachers. Targeting is continuously being improved to ensure that
students belonging to poor families in poor urban areas were included.
In the 1999/2000 fiscal year, the programme reached 100 per cent of targeted schools
and almost 100 per cent of targeted students (roughly 9.5 million). The budget spent 489.9
billion rupiah (94.5 per cent of the target), a fair amount reflecting the extent of coverage
of schools and students.
In looking at the overall programme, at least two big issues appear, namely the
management and the financing of the programme. As mentioned before, many individuals
of various agencies are involved in the administration of the programme. In some cases,
this situation gives rise to a lack of coordination which results in delays of fund
allocations. This, in turn, leads to the reduction in the number of programme participants,
and tardiness in the administration of projects, including the de-worming of children. On
the positive side, this gives rise to an enhanced relationship among community members, a
key aspect of human resources development and people’s empowerment, all vital elements
of community development.
In terms of financing, the funds allocated to the programme during five years
(1996-2000) seem to have been well spent. The local implementors had the ability to
combine the social safety net fund with community support, thus achieving very good
results. There were no reports of corruption or leakages from the fund.
F. Labour-intensive programmes
In response to the sharp increase of unemployment in the wake of the crisis, notably
among unskilled workers, the government introduced a series of cash programmes to create
public labour-intensive activities aimed at mobilizing the unemployed. The crash
programmes were implemented in 10 cities across Java. In 1998, as the impact of the crisis
on people’s living standards became more severe, the government expanded the programme
into a national social safety net to cover the whole country. Encompassed by the new
social safety net, were labour-intensive public works projects aimed specifically at the
unemployed in the urban and rural areas (under the project to overcome the impact of
drought and employment problems programme), the unemployed skilled workers (under the
labour-intensive for skilled employment programme), and the unemployed in the forestry
sector (under the labour-intensive programme in public works for slum and coastal area
development). These programmes were implemented only in fiscal year 1998/1999 and
were later integrated into two larger programmes, the urban labour-intensive programme and
the special initiatives for unemployed women.
169
The programme to overcome the impact of drought was implemented by the Department
of Manpower in two stages. Stage I, for the period from April to December 1998, aimed at
creating 28 million working man-days, and Stage II, for the period December 1998 to March
1999, aimed at providing 23 million working man-days. The programmes were to cover 215
districts in Stage I, and 220 districts in Stage II in all 27 provinces. Eligible participants
received a daily remuneration of 7,500 rupiah/person, a rate comparable to the regional
minimum wage rate. The funding of the programme, amounting to over 317 billion rupiah for
Stage I, and to 279 billion rupiah for Stage II, was fully supported by the state budget.
The programme to overcome the impact of drought focused on the creation of
employment opportunities for manufacturing and construction labourers, as well as the
extension of assistance to poor communities to improve their housing and living conditions.
The programme was launched by the Department of Public Works during the period October
1998-March 1999, with a total budget at 442.5 billion rupiah from the state’s supplementary
budget. Activities in this programme were expected to generate 12.7 million working man-
days, and the remuneration for beneficiaries ranged between 7,500 and 10,000 rupiah,
depending on the location. Activities included public work for the improvement of urban
slum and coastal settlement areas, flooding control and drainage improvement in urban areas,
and the development of public facilities. The programme covered 13 provinces in Indonesia.
The labour-intensive project in the forestry sector was implemented by the Department
of Forestry and Estate during the period June 1998-March 1999. It aimed at overcoming
unemployment and underemployment through public works in forestry, improving the food
security of poor communities through agroforestry activities, and overcoming deforestation
through tree replanting. The beneficiaries were farmers’ associations, the unemployed, and
university graduates with a forestry background. The total budget allocated was 490.5 billion
rupiah, with a target of generating 30.6 million working man-days from public work
activities in 810 villages in 155 districts in 19 provinces throughout Indonesia.
The programme for the skilled unemployed was implemented by the Department of
Manpower with the aim of providing job or business opportunities to skilled unemployed
through its two models: the establishment of productive economic units and the establish-
ment of new self-employed business. Both models were intended to provide jobs and
income, new skills and business networks to the skilled unemployed, as well as to stimulate
local economic activities. The total budget allocation was almost 400 billion rupiah during
the period April 1998-March 1999, with a target of creating some 69,320 jobs from 3,466
activity units. It was implemented in 26 provinces.
The programme of special initiatives for unemployed women was implemented under
the Department of Settlement and Regional Development. This was designed to provide job
opportunities to poor and unemployed women in urban areas through their proposed
economic activities. Beneficiaries were women in poor households without a permanent
income and those living in urban areas. They were between 15 and 60 years old, with no
higher than a high school diplopma. The total budget was 75 billion rupiah, and the target
170
was to create 70,000 jobs for the poor urban unemployed, with a 80:20 female-male
composition. It was implemented in six provinces with large urban centres (North
Sumatera, Jakarta, West Java, Central Java, East Java and South Sulawesi).
Finally, the urban public works programme was designed to provide job opportunities
to around 400,000 unemployed with a 80:20 male-female composition and a compensation
equal to the regional minimum wage. It was also implemented by the Department of
Settlement and Regional Development during the fiscal year 2000. Beneficiaries were the
unskilled and poor unemployed in urban areas, aged 15-55 years, with no more than a high
school education. It was allocated with 366 billion rupiah from the state budget, and it
covered all provinces in Indonesia.
The programme to overcome the impact of drought has shown a fairly good
performance in targeting. With a target of about 28 million working man-days in stage 1
and some 23 million working man-days in stage 2, the programme succeeded in reaching
110 per cent coverage and 88 percent in job creation, with the absorption of an allocated
budget at 99.2 per cent and 78.9 per cent for stages 1 and 2, respectively, during the fiscal
year 1998/1999. A similar achievement was also made in the skilled public works
programme, which absorbed almost 90 per cent of the budget and provided 65,000 jobs, or
100 per cent of the target, during the same fiscal year. Good performance was also
indicated in other public works programmes, especially in the forestry sector which
absorbed only 26.4 per cent of the allocated budget but created 44.6 per cent of the labour-
intensive programmes in the slum and coastal areas. The budget absorption was relatively
high ranging between 75 and 96 per cent, but with low job-creation at around 20-60 per
cent of the target working man-days.
In designated regions implementing the programme to overcome the impact of

drought, a study showed that the programme targeting was moderately effective, as less than
two thirds of the variations in the allocations across regions can be explained by unemploy-
ment and poverty levels (Lewis, 1999). This study also reported that the impact of the
programme on job creation reached 59 million working man-days, with the estimated wage
share to the total budget allocation accounting for 75 per cent. The corresponding figures
for the urban slum and coastal area improvement and public works programme were 57
million working man-days and 45 per cent of the estimated wage share. Criteria selection-
related mis-targeting, and male-biased benefit receivers are the two most frequently raised
problems in the implementation of the programme.
In terms of targeting, the urban slum and coastal area improvement and public works
programme was fairly well-targeted, as 70 per cent of all beneficiaries were unemployed/
laid-off workers, and 65 per cent of them were construction labourers. Nevertheless, the
programme faced several problems. These included a lack of programme socialization and
weaknesses in information delivery, as well as a lack of sustainability, especially since some
communities could not maintain the completed projects and the proposed project/activities
were sometimes not compatible with the actual needs of the village community.
171
The performance of the programme of special initiatives for unemployed women was
similarly commendable. By October 2000, 47.4 per cent of the total allocated budget of 75
billion rupiah had been disbursed, with almost 39 per cent of the targeted working man-
days being absorbed by women. At the same time, the urban labour-intensive programme
showed good performance. In 80 per cent of the districts implementing the programme, 90
per cent of the registered workers were employed within a month, and the programme
created 6.6 million working man-days, or 84.5 per cent of the target.
G. Programme of empowerment for the regions
Finally, a programme focusing on the empowerment of regions to overcome the

impacts of the economic crisis (PDM-DKE) was also launched. The PDM-DKE programme
was formulated to assist poor communities in urban and rural areas to improve their
purchasing power through employment creation, and to rebuild/improve socio-economic and
public facilities to support the production and distribution of goods and services. The
programme was implemented by Bappenas and the Department of Home Affairs. It was
first launched for the period from December 1998 to March 1999, then it continued in
October-December 2000. Target groups were poor populations in urban and rural areas,
particularly those who had lost jobs and income sources, and were unable to meet their
daily basic needs (food, basic health and education). Thus, the selection of location gave
high priority to villages with high unemployment rates, outside of those who have already
been receiving assistance. Geographic coverage of the PDM-DKE programme was urban
and rural villages within sub-districts which were not receiving fund allocations from the
Sub-District Development Programme and the Urban Poverty Alleviation Programme.
In the first year of programme implementation, the total budget allocated for the
PDM-DKE programme was around 1.8 trillion rupiah, and then in the following year, it was
allocated with 792 billion rupiah. As the programme consists of community-based develop-
ment activities, its performance is reviewed from this perspective. Allocated funding is also
reviewed as to its assignment to specific programme activities. During the fiscal year 1998-
1999, 1.45 trillion rupiah was disbursed to finance various activities covered in the PDM-
DKE programme, accounting for 93.4 per cent of the total allocated budget. Based on
reports of programme implementation from districts, the allocated budget was disbursed to
various programme activities in 1998-1999, as follows: 47.8 per cent for infrastructure
development and 52.2 per cent for economic activities/businesses. It was also reported that
the number of PDM-DKE programme beneficiaries was 115,222 community groups, which
was around 8.6 million people with 10,047,980 working man-days.
The data as of October 2000 indicated that less than 10 per cent of the total allocated
budget had been distributed to the target groups. In relation to the planning process
undertaken at the community level, the report suggests that in almost all target villages, village
community discussions were held on two occasions, whereby 86 per cent of villages, over one
fifth of poor households took a role in the first and second community discussions.
172
H. Monitoring and evaluation
Much of what now takes place as monitoring and evaluation of social safety net
programmes is self-initiated. Though this procedure has been well-appreciated in the
importance of its findings as guidance to programme implementation, it has been questioned
on the grounds that it tends to be self-serving, i.e. exaggerating sucesses and minimizing
failures. As a result, NGOs have been encouraged to engage in the monitoring and
evaluation of social safety nets at various levels. Among the NGOs that have been involved
in project monitoring and evaluation are the Social Monitoring and Early Response Unit or
SMERU which assessed the impacts of several social safety nets on poverty, labour markets,
health and education, gender, and crime, among others. After 18 months since its
establishment, it had detailed its findings in more than 60 reports. The Civil Society
Independent Network for Transparency and Accountability of Indonesia Development, with
its network in 40 districts in the country, has focused its efforts on improving transparency
and raising public awareness of government programmes. The Central Independent
Monitoring Unit and its provincial partners has monitored social safety net programmes in
health and education.
In addition to moniting and evaluation, NGOs have also been involved in actual
programme management of social safety nets and in the implementation of non-crisis related
programmes.
III. OBSERVATIONS
A. Strengths and weaknesses
1. Targeting
In respect of targeting, several conclusions have been reached. With regard to the
link between geographic allocation of funds and the levels of unemployment and poverty, it
was ascertained that the variation in PDM-DKE funding allocation across districts was very
strongly associated with the variations in unemployment and poverty levels, with a
coefficient R2 of 97 per cent. This means that the programme was extremely well-targeted
as it was launched in regions with a high incidence of unemployment and poverty. It is
important to note that the finding is merely an aggregate data-based analysis which often
fails to reflect the reality. The results of the SMERU Rapid Field Appraisal Mission
indicated that the database on the number of poor families (PKS and Prosperous I) and
unemployed persons by districts used for budget allocation of the PDM-DKE programme
was in fact not consistent with the actual programme beneficiaries, causing many eligible
needy people not to receive benefits. As a case in point, in the village of Kalirungkut,
Surabaya, the mission found that only 6 per cent of total PKS in the village received funds
173
for economic activities and that the allocated funds substantially varied between villages,
ranging from 5 million rupiah to 1 billion rupiah. The reason for this state of affairs was
that the method of determining the budget allocation was based on district potential or the
number of poor families and unemployed persons.
The National Planning Agency (BAPPENAS) itself as one of two implementing

agencies admitted various problems in the implementation of the PDM-DKE programme.
The following problems were identified:
(a) Late distribution of funds from the Original Office of Treasury to beneficiaries
which was related to administrative problems, bureaucractic bottlenecks,
geographic coverage, and lack of understanding towards distribution procedure
among local implementers;
(b) Fund leakage;
(c) Mis-targeting to the unintended beneficiaries largely because the number of the
proposed programme beneficiaries was larger than the actual one;
(d) Lack of skills of concerned personnel in executing the programme, and poor
reporting systems that led to a difficulty in carrying out monitoring mechanisms;
(e) Lack of programme socialization potentially causing inadequate transparency in
delivering information on the overall programme implementation and overwhelm-
ing local authorities’ interventions to the use of funds by beneficiaries; and
(f) Lack of understanding towards the procedure of programme implementation
which had caused institutional-related problems, bringing about poor coordination
between implementors.
2. Coordination
As admitted by the Government (TKPP-JPS, October 1999: 3), the lack of awareness
and understanding of the spirit of social safety net programmes, institutional weaknesses,
and the practices of corruption and collusion were the major sources of inefficiency in the
first year of implementation. Although the management of the programmes has improved
and more public involvement has been encouraged by the application of “safeguarding
mechanisms”, implementation remains at a rudimentary stage (Sekretariat TKPP-JPS, 2000).
Coordination, both horizontally and vertically, may be the most important aspect
in implementing any social safety net programme. As shown earlier, they were planned and
implemented by several line ministries/agencies, with their budgets being channelled through
different mechanisms, making horizontal coordination difficult. Moreover, these
programmes were mainly central government initiatives. Although local governments and
the local communities were encouraged to be actively involved in planning and the
174
subsequent steps (targeting, implementing, monitoring, etc.), they remained, for the most
part, spectators to the process, lacking a “sense of belonging” as well as a “sense of
ownership” of the programmes implemented in their localities. There is certainly a need to
develop more reasonable ways for coordinating activities of the government at the various
levels, especially on the grass-roots level.
Again, the cancellation of PKP, PKPP, and PDM-DKE programmes in fiscal year
1999/2000 may be a good example of a lack of coordination. Although such programmes
were repeatedly announced as a government priority in reducing the impact of the crisis, the
lack of coordination between the programme implementing agencies and the financial
authority made the programme impossible to carry out, necessitating its cancellation during
the fiscal year 1999/2000, and its late implemention in the following fiscal year. The
financial documents for those programmes were issued in the end of the first quarter of
fiscal year 2000 (PIN-JPS, 2000: 1), which is a 9-month fiscal year, and started delivering
benefits to the beneficiaries only after three months of implementation at the end of the
year (TKPP-JPS, 2000).
3. Fund use
The crucial source of inefficiency in the social safety net programme implementation
was related to mismanagement and corruption of the programme funds. Fund misallocation
and leakages occurred from the planning stage, implementing stage to evaluating and
monitoring stage. Misuse commonly occurs when programmes are delivered to target
beneficiaries indirectly through the development of infrastructure projects. Mis-targeting
problems, such as the proposed projects being inconsistent with the actual needs of the poor
community, and limited benefits for the poor from the project implementation and outcome,
are classical sources of inefficiency in programme implementation. In addition, the lack of
sound financial accountability and transparency are other important sources of fund
leakages.
Table 3 provides an example of various practices of fund misuse potentially occur-

ring in the implementation of any social safety net programme. This example is drawn
from the result of an audit by the Financial and Development Auditing Agency on the
implementation of the PDM-DKE programme during the fiscal year 1998/1999 in eight
provinces. Overall, the proportion of fund misuse to the total budget allocated for the
programme in these audited provinces was quite small, reaching only 3.4 per cent.
However, an interesting feature appearing in the table is related to the types of misuse.
Table 3 clearly indicates that mis-targeting and inefficient programme implementation were
the major sources of fund misuse, explaining around 57 per cent of the total financial
misuse. This was then followed by poor financial accountability and misuse over the
designated criteria or procedures of programme implementation, leading to financial losses
for the Government.
175
Table 3. Fund misuse in the implementation of PDM-DKE and AMP programmes

based on the results of an audit in eight provinces (North and West Sumatera,
Jakarta, West and Central Java, South Kalimantan, South Sulawesi
and West Nusatenggara) for the fiscal year 1998/1999
Percentage
Millions of
Type of fund misuse share to total
rupiah
misuse
1. Poor financial accountability: 8 935 26.4

a. PDM-DKE (poor project administration & financial 8 402 24.8
accountability)
b. AMP PDM-DKE (incomplete supporting documents for 533 1.6
financial accountability report)
2. Misuse over the designated criteria/rules indicating 5 484 16.2
financial loss for government:
a. PDM-DKE (corruption, fictitious official travel and 4 980 14.7
materials purchase)
b. AMP PDM-DKE (failure to return fund residue to state’s 504 1.5
treasury)
3. Inefficient use of project fund: 127 0.4
(marked-up budget, project activities incompatible to
local conditions)
4. Mis-targeting, ineffective programme implementation: 19 359 57.1
a. PDM-DKE 16 323 48.1
b. AMP PDM-DKE 3 036 9.0
Total misuse in audited fund in the implementation
of PDM-DKE in 8 provinces 33 905 100.0
Total budget allocated for PDM-DKE & AMP programme
in 8 provinces 995 110
Percentage fund misuse to total allocated budget in 8 provinces 3.41
Source: Summarized and calculated from an unpublished report by the Financial and Development
Auditing Agency.
The actual magnitude of misallocation and leakage in the overall social safety net
programme implementation is impossible to detect. The difficulty is related to the fact that
both misallocation and leakage may occur at various levels of implementing agencies from
the central to the community level. However, based on an unconfirmed report, the
magnitude of misallocation and leakage in four programmes, as shown in table 4, was
around 788 billion rupiah. Compared with the total budget allocated to each programme in
176
Table 4. Percentage crude estimates of fund misallocation and leakage in the

implementation of some reviewed social safety net programmes
during the fiscal year 1998/1999
Allocated fund Estimated misallocation/ Percentage

Programme (in billions leakage (in billions misallocation/
of rupiah) of rupiah) leakage
Food subsidy of OPK 5 450 116.7 2.1

Labour intensive in forestry 490.5 160 32.6
PDKMK and P3T 997 370.2 37.1
Scholarship and DBO 1 259 141.5 11.2
Source: Calculated from table 6 and report from the Ministry of Finance as quoted by Kompas, 17 May
1999.
the fiscal year 1998/1999, the proportions of misallocation and leakage were around 2 per
cent for the OPK programme, 32.6 per cent for the labour-intensive programme in forestry,
37 per cent for the programmes to overcome the impact of drought and for skilled labour-
intensive employment, and 11 per cent for the scholarship and the stay-in-school
programme. Apart from the reliability of this report, financial-related mismanagement tends
to be frequent in the case of programmes or projects designed in a great rush and
contingent upon unpredicted events. This especially happens in the early implementation
stage when those involved in the programmes do not know exactly how to proceed.
On the basis of complaints, the government has reviewed programme implementation
and has tried to improve the outreach of social safety nets by using more accurate and timely
data for targeting, and by paying close attention to programme integration and women’s
participation. The outcome of dialogues with community representatives was embodied in 13
recommendations for the structural improvement of social safety net programme imple-
mentation, followed by these five specific programmes for improvement: (a) intensification of
programme socialization; (b) development of mechanisms for complaint resolution; (c)
provision of regular and clear performance indicators; (d) establishment of independent
programme verification; and (e) increased involvement of civil society in monitoring.
B. Safeguarding the social safety net programmes
Although the social safety net programmes had a short-term perspective, it was placed
in a long-term perspective when the Government placed it under the umbrella of ‘good
governance’. Starting in the fiscal year 1999/2000, the Government ruled that social safety
net programme implementation must have three essential characteristics, namely transpa-
rency, participation and public accountability. These qualities were fostered in all social
safety net transactions.
177
1. Transparency
In pursuit of transparency, the implementing agencies of social safety nets were

required to disseminate programmes widely through the media. As a result, at the national
level, each programme implementing agency and the Social Safety Net Information
Clearinghouse, established under the Coordinating Team, disseminated social safety net
information through advertisements and dialogues on television and radio stations, advertise-
ments in the newspapers, and publications of bulletins, leaflets and booklets. These were
distributed through local governments down to sub-district and village level, as well as
through units having worldwide web sites (PIN-JPS, 2000: 5). In addition, local social
safety net information centres produced and distributed information materials to various
groups in the locality.
In reviewing the performance of information dissemination, the question has arisen as

to whether the information reached the intended target groups or not. Studies on the
question have been given opposing answers with some saying that prospective beneficiaries
have been well-informed, while some others indicated that many prospective beneficiaries
have received inadequate information or have not received any information at all, and that
only a few people have made inquiries through local social safety net information centres.
To explain the difference in the conclusions, it has been suggested that the favourable results
were of programmes that have been preceded by careful and intense information work.
As a starting point to increase accountability of programme implementation, social

safety net programmes were required to base their reports on actual performance. The first
indicator of performance in this reporting system was the number of reports received at the
central level. As a new system, it did not run as well as expected. Only a few reports
were received and of those received, mostly were either incomplete or late.
The ultimate indicator is, of course, output. On this account, the social safety net
programmes varied widely. The amount of rice distributed, the numbers of students who
were given scholarships, the number of schools that received block grants, the number of
persons who were employed, and the number of women who have been employed, are
among the indicators of direct output and are easy to measure. However, the ultimate
impact of the programmes on recipients, whether their needs were satisfied and to what
extent, has not been measured.3
The transparency and accountability of implementation can be improved and where

they have been carried out, they have contributed to the encouragement of the public’s
interest and participation in social safety nets.
3 See the series of “Social Safety Net Performance Report” and “Monitoring Report” produced by TKPP-
JPS Secretariat (unpublished).
178
2. Independent verification
Another task pursued to lift the level of programme implementation is the programme
of independent verification. Here, the Controlling Team conducts field verification at the
beneficiary level on the monthly reports of “key social safety net programmes”4 in order to
assess the reliability of reports. The results of the verification were interesting. One
verification found that reports from the block grants for primary and secondary schools
programme were reliable and reflected programme performance in the field.
Some reports, however, were considered “unverifiable”. These included the reports on
the OPK rice subsidy programme. The indicator chosen for the programme was ‘numbers
of families receiving rice’ and the ‘amount of rice distributed’. There was no indicator set
for the quantity of rice distributed to each recipient which was what should have mattered,
from the viewpoint of programme effectiveness.
3. Grievance resolution
The Coordinating Team and all programme implementing agencies established a

complaint resolution unit to handle and resolve any complaint relating to the social
safety net programmes as well as to take up appropriate corrective measures. The
complaint resolution unit reported its actions to the general public and to the Coordinat-
ing Team.
A monitoring report of October 2000 indicated that 73 per cent of the received
complaints on the key social safety net programmes were resolved, and the remaining were
still being investigated. This performance is considered as on the low side. One reason
advanced by one monitoring group for this low performance was the great number of
complaints that had to be tackled including complaints that dated back to the programme’s
first year of implementation.
Although the results show significant achievement, there are several problems still
crying out for a solution. The most important problem is the lack of information on the
existence of the local social safety net information centres. Another problem is that of no
follow-up by responsible institutions of the complaints after they have been made. Another
problem pertained to the status of “resolved complaints” which often required further
follow-up, particularly in referring criminal misconduct to the district attorney and/or local
police offices.
4 The term “key social safety net programmes” refers to six social safety net programmes, i.e. OPK,
Beasiswa & DBO Dikdasmen, JPS-BK, PKP, PKPP, and PDM-DKE.
179
Table 5. Complaints received and handled by the complaint resolution unit,

February 1999 – October 2000
Complaints Resolved
Complaints Under Complaints No Percentage

Key SSN Program received Investigation Proven Evidence of Complaints
to Prove Resolved
(1) (2) (3) (4) (5) (6)
= [(4)+(5)]/(2)
Special Market Operations 428 227 158 43 47.0%

for Rice (OPK)
Scholarship and School Block 828 110 520 198 86.7%
Grant (SBG)
SSN on Health Sector (JPS-BK) 118 39 47 32 66.9%
Urban Labour-Intensive (PKP) 86 23 44 19 73.3%
Special Initiatives for Women 42 6 12 24 85.7%
Unemployment (SIWU)
Empowerment of the 354 99 76 179 72.0%
Regions to Overcome the
Impact of the Economic
Crisis (PDM-DKE)
Total 1,502 405 781 316 73.0%
Source: Drawn from the Coordinating Team, Social Safety Net Performance Report and Monitoring
Report of October 2000.
IV. THE ROLE OF DEVELOPMENT PARTNERS
A. The role of the Government
In general, social safety net programmes were implemented by the central government
through the line ministries/agencies, with their local offices and local units. Furthermore,
these programmes are coordinated by a Coordinating Team headed by BAPPENAS at the
central level, and by the provincial and district/municipal development planning boards at
the local level in the regions. At another level, there is a controlling team, whose members
are reputable individuals from government and non-governmental organizations that provides
inputs to policy-making and verifies reports. A third unit is an independent unit mandated
to monitor programme implementation in the field.
180
The three components were expected to interact and discuss the results of their
respective activities in a “stakeholders’ forum” that was to be set up at the national and
local (district/municipal) levels. See figure I below.
Figure I. National social safety net organizational setting
STAKEHOLDERS’
FORUM
COORDINATING CONTROLLING INDEPENDENT MONITORING

TEAM TEAM TEAM/CIVIL SOCIETY
Programmes GROUPS
Secretariat
CRU ICH National
COORDINATING
TEAM
Programmes Province
Secretariat
CRU IC
District/Municipal
STAKEHOLDERS’
FORUM
COORDINATING INDEPENDENT MONITORING

TEAM TEAM/CIVIL SOCIETY
Programmes GROUPS
Secretariat
CRU IC
Source: Adapted from the Coordinating Team for social safety net programmes (October 1999).
Notes: • Programmes = programme implementing agencies
• CRU = Complaint Resolution Unit
• ICH = Social safety net Information
181
B. Public participation
The introduction of the local stakeholders’ forum nationwide is expected to give

reality to the plan of fostering civil society participation in government activities at the local
level. The forum is expected to provide a public sphere for consultation on the planning
and monitoring of programmes and the handling of complaints (Tim Kerja Persiapan FLP,
2000). Local governments have been instructed to support the establishment of such forums
in their jurisdiction.
As indicated in figure I, civil society is expected to monitor social safety net

implementation independently. The government did not provide funds for such monitoring
but encouraged donor agencies to channel their grants directly to interested organizations.
At the same time, most social safety nets already incorporate civil society and local
community participation in their programmes, including the participation of monitoring
and evaluation consultants (Association of South-East Asian Nations Secretariat, August
2000).
C. Non-governmental organizations
The establishment of the local stakeholders’ forum was expected to increase the
involvement of civil society in decision-making in social safety net programme implementa-
tion. In this era of decentralization, the introduction of the local forum can be considered a
devolution of power from district/municipal government (and legislative body) to the people
themselves. As of October 2000, some 226 forums have been formed in the regions (out of
more than 350 districts/municipalities).
However, there are still many issues and problems about the stakeholders’ forum that
remain to be resolved. One important issue is that most forums have been transformed into
“civil society monitoring teams”, with the limited involvement of NGOs, rather than being a
public space for communication and interaction between local stakeholders – government,
legislative body, NGOs, academicians, community representatives, and the press – as how
they were designed to be. On the part of government, there is an unwillingness to involve
“anti-government NGOs” in the discussion of issues. From the civil society side, there is a
perception that the forum is part of the government’s co-optation effort.
The stakeholders’ forums have so far been successful in initiating public participation,
monitoring implementation in the field, organizing local civil society, and building
interaction mechanisms among local stakeholders (Tim Kerja Persiapan FLP, 2000: 12-13).
As has been pointed out, NGOs have been active in two distinct areas of decision-
making and action in relation to social safety nets, the monitoring and the programme
management. They have also been active in implementing non-social safety net crisis
response programmes of the communities.
182
V. FINANCING
A. Funding through the state budget
The social safety net budget totalled 14,820 billion rupiah, 11,873 billion rupiah, and
5,463 billion rupiah in 1998/1999, 1999/2000, and 2000 respectively, as shown in Table 6.
For each year, the total consists of a portion that comes from the development budget and
another portion that comes from the current or routine portion of the national budget. The
table shows that social safety net budget is allocated to food security, education, health,
employment creation, and community funds programmes.
Table 6. Budget allocation, implementing agency, and source of funds for social
safety net programmes in Indonesia, 1998-2000
Budget allocation (billion rupiah)

Intervention Sector and Implementing Budget
SSN Program 1998/1999 1999/2000 2000 Agency Source
Food Securlty: 633 117 8

Special Market Operation for Rice 0 5 8 BULOG and State budget
(OPK), program management and DDN-OD
safeguarding only
National Food Security Program 633 0 0 Min. of State budget
through Farmers’ Empowerment Agriculture
(PKPN-MPMP)
Development of Poultry Rural 0 57 0 Min. of JBIC
Rearing Multiplication Centre Agriculture
(RRMC)
Rehabilitation of Brackish Water 0 55 0 Min. of JBIC
Shrimp Culture Infrastructures Agriculture
Education: 2 697 2 064 1 066

Scholarship and School Block 1 138 1 251 667 DEPDIKNAS ABD, WB
Grant (SBG) and state
budget
Scholarship for University and 113 278 0 DEPDIKNAS State budget
Block grant
Primary School Rehabilitation and 851 0 0 DEPDIKNAS State budget
Development
Operational and Maintenance Funds 959 535 399 DEPDIKNAS, State budget
for Primary Schools (DOP SD/MI) DEPAG, and
DDN-OD
(continued)
183
Table 6 (continued)
Budget allocation (billion rupiah)

Intervention Sector and Implementing Budget
SSN Program 1998/1999 1999/2000 2000 Agency Source
Health: 2 273 1 664 1 280

SSN in Health Sector (JPS-BK) 1 043 1 030 867 Min. of ADB and
Health state budget
Social Welfare (JPS-BS) 95 102 68 Min. of Social ADB and
Affairs/BKSN state budget
Specific Block Grant for Community 721 0 0 Min. of Health State budget
Health Centres and DDN
OD
Supplementary Food for Primary 414 532 345 Intersectoral State budget
School Students (PMT-AS)
Employment Creation: 2 066 1 000 441

Labour-Intensive Program to Eradicate 997 0 0 Min. of State budget
Crisis Impacts (PDKMK) and Labour- Manpower
Intensive for Trained Working Forces
(P3T)
Labour-Intensive Program in Forestry 490 0 0 Min. of State budget
Sector Forestry
Labour-Intensive Program in Public 579 850 366 Min. of Public State budget
Works Program (PKSPU-CK in Works/DEP-
1998/1999) / Urban Labour- KIMPRASWIL
Intensive (PKP)
Special Initiatives for Women 0 150 75 DEPKIM- State budget
Unemployment (PKPP) PRASWIL
Community Funds: 1 701 792 435

Empowerment of the Regions to 1 701 792 435 DDN-OD State budget
Overcome the Impact of the
Economic Crisis (PDM-DKE)
Total Development Budget 9 370 5 638 3 230
Rice Price Subsidy of OPK program 5 450 6 235 2 232 BULOG State budget
(current/routine budget)
Total Budget 14 820 11 873 5 462
Source: Drawn from PIN-JPS (2000), Programme-Programme Jaring Pengaman Sosial (social safety net
programmes) and other TKPP-JPS publications.
Notes: 1. Three programmes (PKP, PKPP, and PDM-DKE) were not implemented in fiscal year 1999/2000
owing to fiscal limitations.
2. Three programmes (development of the rural multiplication centre, the rehabilitation of brackish
water shrimp culture, and scholarships and university block grants) were implemented as a regular
development programme (non-social safety net) in fiscal year 2000.
184
Table 7 shows the social safety net budget in the context of the national budget.
Two things are immediately noticeable from the table: first, that the total and social safety
net budgets for 1998/1999 were quite high, and second, that both declined thereafter. In
1998/1999, the total budget amounted to 263,888 billion rupiah of which 14,820 billion
rupiah, or 5.62 per cent, was allocated to social safety nets. Both decreased in the
following year, the total budget declining to 212,699 billion rupiah and the social safety net
budget to 11,873 billion rupiah. The percentage of the social safety net budget also
decreased to 5.58 per cent of the total. The decline continued in 2000, when the total
budget fell to 183,069 billion rupiah, and the social safety net budget to 5,462 billion
rupiah. The share of the latter to the former also fell to 2.98 per cent. That the social
safety net budget should go on a decline can perhaps be attributed to the fact that the
crisis to which it was addressed to has lessened, and the worsely affected, as well as the
rest of the population, have been returning to normal life. The fall in the total budget is
more difficult to explain since the economy is said to have been on the mend in the last
year or two, and therefore has been better able to support a larger budget, but that is
beyond the scope of this paper.
Table 7 also shows the sectoral composition of the development budget. This budget
totalled 71,600 billion rupiah in 1998/1999, 61,747 billion rupiah in 1999/2000, and 39,387
bilion rupiah in 2000.
The source and composition of the social safety net budget can also be seen from the
table. The total social safety net budget of 14,820 billion rupiah, 11,873 billion rupiah, and
5,462 billion rupiah in the fiscal years 1998/1999, 1999/2000, and 2000 respectively, can
also be seen. The distribution of the social safety net budget to the different programmes
and projects (i.e. food security, education, health, and employment creation) to the sectoral
budget, regional budget, and project loan funded budget is also shown.
The portion of the social safety net budget that is funded by foreign loans deserves a
closer look. It was 5.6 per cent in 1998/1999, 14.8 per cent in 1999/2000, and 22.4 per
cent in 2000.
B. External sources of financing
Foreign loans played an important role in the financing of the social safety net
programmes in Indonesia, and for that matter, in the financing of the whole development
budget. As Table 7 shows, out of the total development budget of 71,600 billion rupiah in
1998/1999, 40,541 billion rupiah, or 56.6 per cent, was funded by foreign loans. In 1999/
2000, out of the total development budget of 61,747 billion rupiah, 30,000 billion rupiah, or
48.6 per cent, came from foreign loans. In 2000, the figures were: 39,387 billion rupiah of
the total development budget, 16,030 billion rupiah, or 46.0 per cent, from foreign loans.
The portion of foreign loans in the development budget is thus high, even if it is declining.
185
Table 7. Comparison between social safety net programmes

and total budget and gross domestic product (GDP),
1998-2000
Budget Allocation (billlion rupiah)

No. Budget Items
1998/1999 1999/2000 2000
1. DEVELOPMENT BUDGET
1.1 Sectoral Budget

A. SSN Programs Funded by Sectoral Budget 4 252 2 020 827
a. Food Security 633 5 8
b. Education 612 832 378
c. Health 940 183 0
d. Employment Creation 2 066 1 000 441
B. Total Sectoral Budget 17 253 15 618 8 218
Percentage of SSN to Total Sectoral Budget (A/B) 24.64 12.94 10.06
1.2 Regional Budget

A. SSN Programs Funded by Regional Budget 4 282 1 859 1 179
a. Education 1 446 535 399
b. Health 1 135 532 345
c. Community Funds 1 701 792 435
B. Total Regional Budget 13 806 16 129 15 139
Percentage of SSN to Total Regional Budget (A/B) 31.01 11.53 7.79
1.3 Project Loan Funded Budget

A. SSN Programs Funded by Project Loan 836 1 758 1 224
a. Food Security 0 112 0
b. Education 639 697 289
c. Health 198 949 935
B. Total Project Loan Funded Budget 40 541 30 000 16 030
Percentage of SSN to Total Loan Funded Budget (A/B) 2.06 5.86 7.64
TOTAL DEVELOPMENT BUDGET

A. Total SSN Programs Funded by Development Budget 9 370 5 638 3 230
(1.1.A + 1.2.A + 1.3.A)
B. Total Development Budget (1.1.B + 1.2.B + 1.3.B) 71 600 61 747 39 387
Percentage of SSN to Total Development Budget (A/B) 13.09 9.13 8.20
(continued)
186
Table 7 (continued)
Budget Allocation (billlion rupiah)

No. Budget Items
1998/1999 1999/2000 2000
2. CURRENT (ROUTINE) BUDGET

A. SSN Programs Funded by Current Budget 5 450 6 235 2 232
(Rice Price Subsidy, OPK)
B. Total Current Budget 192 288 150 952 143 682
Percentage of SSN to Total Current Budget (A/B) 2.83 4.13 1.55
TOTAL BUDGET
A. Total SSN Budget 14 820 11 873 5 462
B. Total Budget 263 888 212 699 183 069
Percentage of SSN to Total Budget (A/B) 5.62 5.58 2.98
C. Gross Domestic Product (GDP) 951 975 1 224 200 910 432
Percentage of SSN to GDP (A/C) 1.56 0.97 0.60
Source: 1. Calculated from several publications of TKPP-JPS.

2. Financial Notes and Proposed Budget (1999/2000 and 2000).
Notes: 1. Categorization of the budgets of fiscal year 1998/99 and 1999/2000 follows newly implemented
system (started in fiscal year 2000).
2. Three programmes (PKP, PKPP, and PDM-DKE) with a budget amounting Rp 1,792 billion were
not implemented in fiscal year 1999/2000 owing to limited budget.
3. Fiscal year 2000 is a transition from April-March budget period to January-December (only 9
months).
Only a small percentage of total foreign loans went to social safety nets: 2.1 per cent
in 1998/1999; 5.9 per cent in 1999/2000; and 7.64 per cent in 2000. But the foreign loans
that went to the social safety net programme, small as they were relative to the total foreign
loans, were considerable when matched against the total social safety net budget. As shown
in table 8, they represented 5.64 per cent in 1998/1999, 14.82 per cent in 1999/2000, and
22.4 per cent in 2000. In other words, the share of foreign loans in the financing of social
safety nets in Indonesia is rising.
Foreign loans supporting the Indonesian development programme, including social

safety nets, consist of the following: (a) from the World Bank, US$ 600 million; (b) from
ADB, US$ 71,390; (c) from the Japan Bank for International Cooperation, US$ 600 million;
and (d) smaller amounts from the United Nations and other sources, i.e. the United States
Agency for International Development (USAID), Australian Agency for International Devel-
opment (AusAID), the Canadian International Development Agency (CIDA), the German
GTZ, and the Dutch Aid.
187
Table 8. The role of international assistance in the funding of

social safety net (SSN) programmes by sector
SSN 1998/1999 1999/2000 2000

Intervention
Sector Total Foreign Proportion Total Foreign Proportion Total Foreign Progortion
Budget Loan of Loan Budget Loan of Loan Budget Loan of Loan
Food Security 6 083 0 0.00 6 352 112 1.76 2 240 0 0.00

Education 2 697 639 23.67 2 064 697 33.78 1 066 289 27.11
Health 2 273 198 8.70 1 664 949 57.02 1 280 935 73.05
Employment 2 066 0 0.00 1 000 0 0.00 441 0 0.00
Creation
Community 1 701 0 0.00 792 0 0.00 435 0 0.00
Empowerment
Total 14 820 836 5.64 11 873 1 758 14.81 5 462 1 224 22.41
Source: Calculated from several publications of TKPP-JPS.
C. Remarks
Several considerations related to the social safety net programmes and the overall
budget need to be recognized. For all social safety net projects, there is a need to link
estimates of social impact to budget allocation. There is also a need to make clear the
returns that are expected from financial programmes. There are some obvious limitations to
decentralization of budget allocation, including the lack of adequate planning capacity at the
local level, problems in integrating local planning into national planning, and the ever present
reality of people at the community level “more often than not, still not directly involved in
the planning process” (Coveyers, 1982:109). These considerations should be addressed if
allocations are to correspond to their best sector, and if budgeting is to be decentralized.
The foreign loan component of the social safety net programmes also needs to be
evaluated in the context of social safety nets as well as the whole national context. The
actual amount of this component is “small” at the present and does not appear to pose a
danger to the sustainability of the system, but as a proportion to the total social safety net
budget, it is increasing. This rise, if not checked, will result in a heavy burden for present
and future generations of Indonesians.
VI. RECOMMENDATIONS
On the basis of the strengths and weaknesses of the Indonesian social safety net
programmes uncovered in the preceding discussions, the following recommendations,
intended for improving and enhancing policy formulation and programme implementation,
are being put forward.
188
A. Improvement in the administrative capacity

of local planners and executors
Although there is need for improvement in the quality of higher level leadership in
social safety nets, the need is more pressing and urgent at the local level. Here, the
improvement must start from planning, and goes on to the implementation, down to
monitoring and evaluation. It must encompass all local officials, individuals and agencies
involved in social safety net policy and programme implementation. This is the keyword to
guarantee efficient and effective social safety nets to their ultimate beneficiaries.
B. Establishment and continuous strengthening of databases
This is the only way to begin solving the ubiquitous problem of mis-targeting. Since
the target groups of social safety nets are the poor who tend to be hit most severely by
crises, identifying the poor accurately improves the targeting of social safety nets. How
poverty is measured and quantified then becomes important to the accurate targeting of
social safety nets. By and large, there are two types of poverty statistics or information.
The first is the number of population living below the predetermined poverty line by region,
and the second is the identification (names and addresses) of the poor. Quantitative
information on the various socio-economic dimensions of poverty will also be useful.
These pieces of information must be gathered and compiled systematically in order to
provide an accurate and adequate basis for targeting the victims of crises who happen, in
the majority of cases, to be poor.
The data, for both national and local agencies, must be slowly but steadily built up in
a data bank by professionally qualified individuals and institutions. They must be
constantly updated to ensure their reflection of current realities.
The table below outlines the top-down and bottom-up approaches to targeting of
social safety net programmes, in particular, and anti-poverty programmes in general. If
used in combination, the two approaches will help ensure more accurate targeting for social
safety net programmes.
C. Shift from crisis-oriented social safety net programmes

to longer-term programmes
This calls for the effective transformation of short-term social safety nets to long-term
social security programmes, schemes that will be continued into the future and for all time,
similar to the existing social security system for people in the formal sector, in order to
provide continuing support and assistance to poor people even in between crises. This
obviously requires funding that is not dependent on government coffers which suffer
precisely when crises occur, nor upon foreign loans that impose a burden of unpredicted
weight on present and future generations. Ways must be found to start independent
financing for social safety nets.
189
Table 9. The combined top-down and bottom-up approach in

defining the target groups
Mechanism Type and mechanism of determining target groups

Approach of distributing
budget to the Geographic Sectoral Individual
poor targeting targeting targeting
Top-down Determining Data on number Data on number 1. Data on number

distribution of and names of the and percentage and percentage of
assistance target sub-districts of poor households poor population
programme budget and villages by sector (industry and poor households
allocated to the according to & occupation) of by districts
target groups by poverty typology main breadwinner 2. Establishing
provincial and by districts and by districts several nationally
district levels, standardized and
according to the operational criteria
number of the poor* of the poor
Bottom-up Determining Determining the final and most eligible Applying self-
distribution of target sub-districts and villages on the selection or self-
budget allocated to basis of the real condition, and mutual targeting at village
the target groups compromise of all relevant interests and lower
by sub-district and administrative
village levels, levels using the
according to the standard criteria
number of finally with some local
determined target adjustment, with the
groups and localities following procedures:
1. Identification of
the target groups is
first based on
knowledge of local
authorities, commu-
nity leaders, or
volunteers regularly
involved in distribut-
ing tithe or donation
to the needy
2. Direct verification
of the identified
target groups to
decide the final and
most eligible target
groups
Note: * One of the most common formulas used to estimate funding allocated to alleviate the living standard
of the poor to the predetermined poverty threshold is the derivation of F-G-T Indices which can be
written as follows: Fi = P1/P0*Z*NP, where Fi: total funding allocated to the poor per month in
region-ith; P1: poverty gap index in region-ith; P0: head-count ratio (per cent poor to total population)
in region-ith; Z: poverty line (rupiah/capita/month) in region-ith; and NP: absolute number of poor
population in region-ith.
190
ANNEX I.
Summary of social safety net implementation during the crisis in Indonesia
TARGET
PROGRAMME AIMS TARGET GROUPS ACTIVITIES
ALLOCATION
1. Operasi Pasar Khusus • To help the target groups • The target groups are • Distribute 10 kg/ • Fiscal year 1998/1999:
(OPK) of poor families to fulfil Pre-Prosperous (KPS) HH/month with a price Target: 14.9 million
Special Market basic needs (rice) with and Prosperous I of 10,000 rupiah/kg, HHs
Operations for Rice cheap price with a certain Families (KS I) and the quantity has been Realization: 1.06
By Office of Minister quantity and period originally based on the increased to 20 kg/ million tons of rice
for Food Affairs and • Rice subsidy in the regular National Family HH/month since Dec. delivered to 5.3
Food Logistics Agency OPK programme is not Planning Coordinating 1998 (up to 1999/2000) million HHs (Jul-
(Kantor Menpangan distributed to general Agency data that was • In 2000, the amount of Nov 1998) and 10.0
dan Bulog) market channels, but continuously reviewed by rice is determined by each million HHs (Dec
• Period: FY 1998/1999, directly to the target regional and subregional local government with 1998-Mar 1999) on
1999/2000, and 2000 groups food logistics depots a maximum of 20 kg and average/month.
• Source of fund: state • Quantity of distributed with related institutions minimum of 10 kg. • Fiscal year 1999/2000:
budget (development rice is not determined • Poor households that are • Rice distribution is done Target: 14.6 million
and current budget) by market demand, not included in the data by the special team from HHs
• Coverage: all provinces. but based on the number (e.g. non-registered poor) the food logistics depots Realization: 3.4
of target families are eligible to be in collaboration with local million tons of rice
• It is not intended to beneficiaries based on people at village level. delivered to 10.9
stabilize market food the results of village million HHs on
prices, but merely to help community meetings (average/month)
food insecure families • Fiscal year 2000:
Target: 14.3 million
HHs
Realization (as of Oct):
1.0 million tons of
rice delivered to 9.3
million HHs on
(average/month)
(continued)
191
ANNEX I (continued)
192
PROGRAMME AIMS TARGET GROUPS ACTIVITIES TARGET
ALLOCATION
2. Peningkatan Ketahanan • To increase the national • Poor farmers/fishermen • Improving intensification • Target: intensification
Pangan Nasional melalui food stock, available and experiencing reduction in of production of rice, of production of rice,
Pemberdayaan affordable for all people, purchasing power owing maize & soybean. maize & soybean to
Masyarakat Petani through improvement in to crisis impacts • Extensifying cultivation 52 million tons,
(PKPN- MPMP) food crop production, area of rice, maize and 12 million tons and
National food security poultry and fish soybean 2 million tons
improvement through products • Providing advocacy respectively, in 10.6
empowerment of farmers • To intensify the assistance, involving million hectares
By Department of production and quality 5,500 undergraduate • Development of
Agriculture of food cash crops students fishpond culture
• Period: FY 1998/1999 cultivation, livestock and • Establishing a special covering an area of
• Source of fund: State fishery products effort to develop 986 hectares
budget • To encourage the agrobusiness-oriented • Development of
• Coverage: all provinces effective use of applied livestock, poultry, and husbandry cultivation,
agricultural technology/ fishery culture accounting for
mechanization 270, 000 local
• To optimize the chickens/ducks,
distribution of credits 16,500 goats/lambs

for farming business, and 3,900 cows/dairy
including timely supplies cows
of fertilizers and other
production inputs
• To support pest
control and to maximize
pasca-harvesting
production
processing
(continued)
ANNEX I (continued)

ALLOCATION
3. Beasiswa dan DBO • The scholarship • Scholarship recipients • Distributing scholarships • Fiscal year 1998/1999:
Pendidikan Dasar dan programme is to help are students from poor to school children from Total budget: Rp 1,138
Menengah school children at families (PKS and KSI) poor families billion Target: 1.8
(DIKDASMEN) primary, junior and senior with criteria: at Grade • Providing operational million primary student,
Scholarship and block high levels from poor 4, 5, 6 of primary school assistance fund block 1.65 million junior high
grant for primary and families finance their and at all grades of junior grants to schools that student, and 500.000
junior education educational costs, in order and senior high school; mostly need the senior high student.
By Department of to avoid the incidence of drop-out students, non- assistance Target for operational
National Education drop-out caused by recipients of other assistance fund block
• Period: FY 1998/1999, economic problems, to scholarships grant: 104,000 primary
1999/2000 and 2000 have the opportunity to • Block grants of DBO school, 18,000 junior
• Source of fund: state continue to higher are allocated to both state high school, and 9.5
budget & foreign loan educational levels, and to and private schools that senior high school.
(World Bank and ADB) encourage all school-aged mostly need assistance, Realization: 98 per cent
• Coverage: all provinces children, notably women, with criteria: not for scholarship
to complete a minimum expensive schools, programme and 100
junior high level registered schools per cent for
• To help schools maintain DBO Block Grant
educational services to • Fiscal year 1999/2000:
the community for Total budget: Rp 1,251
overcoming the increased billion Target: same as
costs of educational needs FY 1998/1999 Realiza-
tion: 100 per cent for
scholarship programme
and the block grant
• Fiscal year 2000:
Total budget: Rp 667
billion
Target: same as FY
1999/2000
Realization: 100 per cent
for scholarship
programme and the
block grant
(continued)
193
ANNEX I (continued)
194
ALLOCATION
4. Beasiswa dan DBO • To improve the equality Scholarship is given to: Both Scholarship and Block • Fiscal year 1998/1999:
Pendidikan Tinggi of access for students Students in a vulnerable Grant is directly given or Target: 322,000
(DIKTI) at higher education with position of possibly transferred to higher university students and
Scholarship and block financial problems discontinuing study as institutions (universities, and 200 universities
grant higher education • To support and to a result of financial crisis other higher educational • Fiscal year 1999/2000:
By: Department of maintain the spirit to of their family; particularly institutions) Target: 180,000
National Education study and finish their high achiever students university students and
• Period: FY 1998/1999 degrees 1,000 universities
and 1999/2000 • To improve student scores Operational assistance fund Selected student to receive
• Source of fund: state • To give students block grant is given to: the scholarship is fully
budget working experience all universities and higher authorized to university
• Coverage: all provinces • To save the nation institutions in Indonesia based on general
asset on potential and requirements
productive human
resources
• To support operational
education services and
facility maintenance
5. Programme Operasional • To keep and maintain Educational institutions The work of school Budget:
dan Perawatan Fasilitas quality facilities within Primary/Junior High/Senior maintenance is for small 417.65 billion rupiah
(OPF) DIKDASMEN primary and junior high High and Vocational category and its operation
Operational and facilities school, both state and
maintenance programme. private
By: Department of • To support learning
Cultural and Education process to its maximum
• Period of activity: FY capacity
1998/1999
• Source of fund: state
budget
• Coverage: all provinces
(continued)
ANNEX I (continued)
TARGET
ALLOCATION
6. Programme Rehabilitasi • To improve the quality Schools with serious The work for schools Total budget:
SD/MI of primary educational damage and urgent need rehabilitation is given 855.6 billion rupiah
Rehabilitation programme institutions, including to be rehabilitated to local society and
for primary school religious schools construction workers
By: Department of • To provide job
National Education opportunities at village
• Period of activity: FY level
1998/1999 • To assist schools in
• Source of fund: state keeping the learning
budget process to it best
• Coverage: all provinces
7. Bantuan Pembangunan Primary activity: • Primary educational Main activities: Total budget:
(SD) To improve quality, equality institutions • build school premises 594,978 million rupiah
Primary education and efficiency as well as that fulfil the • build additional
assistance facilities for learning process requirements and schools classrooms
By: Department of of primary education, that have a School • primary and religious Fund distribution:
Education and Culture including Islamic primary Statistical Number and a schools The programme for
• Period of activity: FY schools Building Statistical • build various room Presidential assistance
1998/1999 Supporting activities, Number such as libraries, fund for primary schools
• Source of fund: state providing: • New primary school at multi-function rooms
budget • materials and books for migrant remote/isolated and workshops for
• Coverage: all provinces the curriculum areas, Perumnas, and teachers of main
• demonstrative tools for border areas primary schools
learning process • Build teacher’s state
• tools for school residential house
administration • Build dormitory for
• training for elementary students
teachers and its strata
(D4) and training for
teachers and allocation
for remote areas
(continued)
195
ANNEX I (continued)
196
TARGET
ALLOCATION
8. Jaring Pengaman Sosial General aim: • Poor family and its Primary activities: Fiscal Year 1998/1999:
Bidang Kesehatan To improve and maintain members for basic health Providing basic health Target group: 18 million
(JPS-BK) the health and nutrition services. The selection services at community HHs
Social safety net for the of poor families of poor families is based health centres and Realization: 15.3 million
health sector on two criteria referral HHs
By: Department of Specific aims: • Pre-prosperous and • Providing midwifery Budget: 1,043 billion
Health • To provide health prosperous I owing services and referral rupiah
• Period of activity: FY services and methods for to economic reasons • Providing referral
1998/1999, 1999/2000, poor families by • Other poor families services at town/ Fiscal Year 1999/2000:
and 2000 community health centres suggested by local leaders provincial hospitals Target group: 8 million
• Source of fund: state and other public health • Pregnant women, • Preventing and HHs
budget and external loan centres post-natal mothers, and alleviating any Realization: 7.3 million
(ADB) • Provide midwifery health babies to have midwifery epidemic/diseases HHs
• Coverage: all provinces services health services via providing vaccines Budget: 1,030 billion
• Provide health and • Pregnant women, for immunization rupiah
nutrition improvement for post-natal mothers, and • Improving nutritional
pregnant and post-natal babies (age 6-11 months) status Fiscal Year 2000:
women, infants and and children (age 12 -23 Target group: 10.3 million
babies months) to have Supporting activities: HHs

nutritious food • Conducting Society Realization: 9.3 million
supplements Health Bond (Jaminan HHs
Pemeliharaan Budget: 867 billion
Kesehatan Masyarakat, rupiah
JPKM)
• Food and Nutritions
Surveillance System
(SKPG)
• Revitalization of
integrated health
service posts
(continued)
ANNEX I (continued)

ALLOCATION
9. Jaring Pengaman Sosial • To support social Street children: Main activities: Budget:
Bidang welfare of children • those children with Providing scholarship to FY 1998/1999: 92.1 billion
Kesejahteraan Sosial and teenagers at high most of their time street children rupiah
Social security net for risk of becoming living on streets • To give scholarships FY 1999/2000: 102 billion
social welfare street children because • Children living on • To give tutorial and rupiah
By: Department of of economic crisis the street (homeless counselling to students FY 2000: 68 billion
Social Affairs • To provide scholarships children) and their parents rupiah
• Period of activity: FY for street children • Children at high • Provide scholarship
1998/1999, 1999/2000, to support their study risk of becoming to any student at Realization:
2000 • To provide scholarships street children primary, junior and Various activities
• Source of fund : state for homeless children Homeless children: senior high schools related to street
budget and external loan for their school • children with no parent • Financial support to children and homeless
(ADB) • To provide fund • those children living sheltered houses for children
• Coverage: 12 provinces assistance training in sheltered houses/ street children
• To provide food for social homecare • To provide food Supporting activities:
street children to for students and Social charity for
maintain their health those at risk of poor family, and
and nutritional status dropping out from meals for street
school children
10. Programme Makanan • To improve student All students at primary The programme preparation: Fiscal year 1998/1999:
Tambahan Anak nutritional status level including those at Using local agricultural Budget: 414.46 billion
Sekolah (PTM - AS) • To strengthen and Islamic religious school and products rupiah
Supplementary food for prevent students from those students living in Target: 8.2 million primary
primary school students any infectious diseases backward villages (eastern The programme students
By: Intersectoral • To support the Indonesia). implementation; Realization: 8.2 million
• Period of activity: programme for using Food supplement is primary students
FY 1996/1997 to 2000 school gardens to prepared and organized by
• Source of fund: state improve: student’s households and women’s Fiscal year 1999/2000:
budget nutritional status; group associations (PKK) Budget: 532 billion rupiah
• Coverage: all provinces food diversification; and Target: 9.8 million primary
the agricultural programme students
of ‘compact society’ or Realization: 9.5 million
masyarakat terpadu primary students
(continued)
197
ANNEX I (continued)
198
ALLOCATION
• To support growth of Notes: This programme Fiscal year 2000:

rural base economy at actually started in 1996 in Budget: 345 billion
the IDT villages line with the programme rupiah
• To build the sense of for teenagers. It is expected Target: 9.6 million primary
“I love Indonesian Food” that this programme will students
support the national Realization: 9.5 million
educational compulsory primary students
programme of 9 years of The budget allocated for
primary education Food this programme is directly
supplement is given 3 times transferred to the account
per day over a 9-month of the school headmaster
period via the post office
11. Bantuan Prasarana • To reduce flood damage • Local contractors • Cleaning up/ dredging Total budget:
Dasar Pemukiman for the people of Jakarta. registered / licensed large canals and 83,136 million rupiah
Programme • To create employment at DKI sewerages using heavy
Penanggulangan Banjir and work in flood areas • Construction labourers construction tools Period of work:
DKI Jakarta partly for dismissed and and construction workers • Water pump installations 2-3 months for unskilled
Block grant for unemployed persons at managerial level. for high risk areas workers and various for
basic settlement • If the work is less than of flood those using heavy load
infrastructure and 50 million rupiah, the • Widening the areas equipment
flooding control contractors have to be for water reservoirs,
programme in Jakarta selected from low level for flood control
By : Department of contractors. If the work • Providing flood control
Public Works is more than 50 million equipment
• Period of activity: rupiah, free selection can
FY 1998/1999 take place
• Source of fund:
state budget
• Coverage: Jakarta
(continued)
ANNEX I (continued)
TARGET
ALLOCATION
12. Programme • To provide housing for • Registered contractors at Managing slum areas Total budget:
Pembangunan RSS people suffering from the National Housing Board alleviation programme 14,521 million rupiah
Dilokasi Samarinda relocation programme of (Perumnas) and local along the stream of the
Bengkuriang dan the Karangmumus river administrative offices Karangmumus river.
Sambutan in Samarinda • The selection of chosen
Small-sized housing • To create employment contractor is done using
development programme and job opportunity for the standard of
in Samarinda workers in the areas Perumnas’s requirements.
By: Department of of public work
Public Works • To provide achievable
• Period of activity: price of housing for
FY 1998/1999 people of low purchasing
• Source of fund: state power / economically
budget incapable
• Coverage: 1 town
( Samarinda )
13. Programme • To provide housing for • The poor living at • It is essential that the Total budget prepared
pembangunan people living in slum Jakarta’s river side work of the programme for the programme:
rusunawa Di lokasi areas along the river • Contractors, registered at uses local and domestic 18,771 million rupiah
Sindang Koja Jakarta side of Jakarta; those ‘Perum perumnas’, local materials.
Utara suffering from the government instruments • This type of work is Average period of
Housing development relocation programme and related person to usually done in big cities work: 9 months
programme for people • To create employment the programme and metropolitan cities.
at Sindang Koja – and job opportunity for development • Managing slum areas
North Jakarta. workers in the areas alleviation programme
By : Department of of public work. along the stream of
Public Works • To provide achievable Sunter canal.
• Period of activity: price of housing for
FY 1998/1999 people of low purchasing
• Source of fund: power / economically
state budget incapable
(continued)
199
ANNEX I (continued)
200
ALLOCATION
14. Programme Perbaikan • To create employment • Local contractors, • Cleaning up slum areas Total budget:
Kampung Kumuh dan and job opportunity registered at secondary at fisherman villages 442.5 billion rupiah
Nelayan Padat Karya partly for workers in level of administrative – • Reducing swamp areas
Sektor Pekerjaan the construction industry ‘DATI II’, along with its in the city and fixing Target: 56 million
Umum (PKSPU-CK • Release people’s burdens workers and person in sewerage pipes man-days
Cipta Karya) for fixing the house charge for the programme • Fixing public facilities Realization: 52 million
Urban slum and and their environment development mainly traditional markets man-days
coastal area relating to less • Local unemployed • Other achievable public
improvement and purchasing power of construction labour and work in collaboration Average period of work:
public work (PKPS- local society people dealing with with local administrative 3 months using well-
cipta karya programme) supply of materials for people (PEMDA) trained construction labour
By: Department of various types of
Public Works construction work Average fee per worker
• Period of activity: per day:
FY 1998/1999 Ranging between: 7,500 –
• Source of fund: 10,000 rupiah depending
state budget on work location
• Coverage: 13 provinces
15. Proyek penanggulangan • To provide productive • Unemployed persons of Building and repairing Total budget:
Dampak kekeringan and continued economic crisis and various types of public 317,174 million rupiah
dan masalah employment for the less drought victims in both work as follows:
ketenagakerjaan educated unemployed urban and rural areas • Drainage to support the Target: 22 million
(PDKMK) tahap I both rural and urban • Local community as a agricultural production man-days
Project for overcoming • To empower local whole, partly those • Village roads, to support Realization: 21 million
the impacts of drought society economically suffering from crisis transportation and man-days
and employment-related • To support local and drought production marketing
problems, Stage I economic institutions via • Local and traditional Average working days
By: Department of managing various public markets per programme:
Manpower works programmes • Making water reservoirs 10 days using rotation
• Period of activity: • To support local to support wet land system for all available
FY 1998/1999 development programmes irrigations workers at location
(continued)
ANNEX I (continued)

ALLOCATION
• Source of fund: state • Breeding economical

budget plants–intensify local
• Coverage: 7 provinces ponds and dyke for
(215 municipalities) profit-oriented activities
• To create various
alternative work to
produce materials for
construction.
• To build simple market
and kiosk, etc
16. Proyek penanggulangan • To provide new • Unemployed persons of • Building and repairing Total budget:
Dampak kekeringan productive and continued economic crisis and various types of public 279.43 billion rupiah
dan masalah employment for the less drought victims in both work relating to the
ketenagakerjaan educated unemployed, urban and rural areas aims of the project Target man-days:
(PDKMK) tahap II both rural and urban • Local community as a • Providing new productive 23 million
Project for overcoming • To empower local whole, partly those and continued employment
the impacts of drought society economically suffering from crisis and for less educated Realization:
and employment-related • To create investment drought unemployed, both rural 22 million man-days
problems, Stage II for the local economy and urban
By: Department of • To create community • Empowering local Average work per
Manpower saving programme society economically programme:
• Period of activity: FY • To use and improve • Creating investment for 1 month
1998/1999 technology implementation the local economy
• Source of fund: state for local development • Creating community
budget saving programme
• Coverage: 220 districts • Implementing new
in 27 province technology for local
development drainage to
support agricultural
production
(continued)
201
ANNEX I (continued)
202
TARGET
ALLOCATION
• Supporting local and

traditional markets
• Breeding economical
plants–intensify local
ponds and dykes for
profit-oriented activities
• Improving various
alternative work to
produce materials for
construction
17. Proyek padat Karya • To overcome • Groups of farmers Development activities cover: Total budget:
Sektor Kehutanan unemployment and • Unemployed workers • Civil forest programme 490.52 billion rupiah
Labour intensive disguised unemployment • Full degree graduate for 50,900 hectares
project in the forestry by creating various jobs with forestry background • Industry plant forest Target: 30 million
sector in the forestry and 51,340 ha. man-days
By: Department of plantation sector • Bakau Forest Realization: 13.4 million
Forestry • To help those families rehabilitation, 2110 ha. man-days
• Period of activity: at high risk of hunger • Green line forest
FY 1998/1999 • To prevent forest programme, 9,740 Average period of work:

• Source of fund: destruction hectares Ranging according to
state budget • To consolidate local • Protect forest programme, season: 3–6 months
• Coverage: 155 institutions in the village 4, 670 hectares
municipalities • To employ potential • Forest for silk
(810 villages) in workers and fresh production, 680 ha.
19 provinces graduates • Water reservoir and
absorption dig, 4.330
hectares.
• Multifunction land,
105, 770 hectares
(continued)
ANNEX I (continued)

ALLOCATION
18. Proyek The programme is • Unemployed workers • Unemployed workers Total budget:
Penanggulangan developed by 2 models: with specific skills support by giving living 399,185 billion rupiah
Pengangguran Pekerja • Productive economic and experience incentive for 7 months
Terampil (P3T) institution • Victims of economic period during the training Target:
Labour-intensive for • New self-employment crisis (dismissed workers) • For the new-self 69, 320 person for 3.466
skilled labourers business • Formal workers with employed, support is packages
By: Department of letter of dismissal from given in terms of amount
Manpower These aim at providing formal enterprise or of capital to activate Minimum incentive is
• Period of activity: independent institutions company their business 300.000 rupiah during
FY 1998/1999: to support skilled 7 months of training.
• Source of fund: unemployment
state budget
• Coverage: 26 provinces
19. Pemberdayaan Daerah • To improve purchasing • Poor people in both • Keeping and building Fiscal Year 1998/1999:
dalam Mengatasi power of the poor in urban and rural areas various infrastructure Budget: 1,701 billion
Dampak Krisis both rural and urban including those suffering facilities: roads, irrigation rupiah
Ekonomi (PDM-DKE) areas by creating from a loss of jobs and network, waste disposal Beneficiaries: 8 million
Empowerment of employment and job source of income, those place, water reservoir, HHs
regions to overcome opportunities who can not fulfil flood control areas, and
the impact of the • To intensify the their basic needs alternative work for Fiscal year 2000:
economic crisis function of local economy • Villages with highest unemployed persons Budget: 435 billion
By: Bappenas and by rebuilding the social population of those • Funds for micro rupiah
Ministry of Home economy infrastructure to mentioned above, villages enterprises implemented Target group: 1.3 million
Affairs support the local with a high number by the poor HHs
• Period of activity: FY production system of total unemployment • Beneficiaries, activities,
1998/1999 and FY 2000 and budget allocation
• Source of fund: state are determined by
budget the community through
• Coverage: all provinces village discussion
(continued)
203
ANNEX I (continued)
204
TARGET
ALLOCATION
20. Pengembangan • To increase the • Those registered in 2 components in Total budget allocated:
Perbibitan dan productivity of local farmer associations programme activities: 57.3 billion rupiah
Budidaya Ayam Buras poultry activities in seeking capital support 1) Built-operate-transfer Target:
di Perdesaan rural areas and having potential components, including • Establishment of 62
Local poultry rural • To generate job to improve their construction/buildings, local poultry RRMC
rearing multiplication opportunities in rural business performance. machinery, other units, consisting of
centre (RRMC) areas through the infrastructure multiplication centres,
By: Department of development of local 2) Component of direct poultry food processing
Agriculture. poultry agrobusiness assistance by providing units, veterinary service
• Period of activity: • To improve income and a poultry production centres and business
FY 1999/2000 welfare level of rural inputs centres, and involving
• Source of fund: farmers 248 farmer associations
Foreign loan OECF • Production of 1,875
(JBIC) for social chicks for rearing per
safety nets month for each
• Coverage: 62 districts RRMC unit
in 16 provinces • Farmers will earn
150,000 rupiah from
this business activity
21. Pengembangan Tambak • To increase shrimp • Those registered in • Rehabilitation of irrigation Total budget allocated:
Rakyat/Intensification production and the brackish water farmer system to support 54.974 billion rupiah
of brackish water productivity of brackish associations facing brackish water cultivation, Target: intensification of
cultivation water culture financial difficulty in covering 5,350 hectares brackish water cultivation
By: Department of • To generate job and running their business spread over 10 provinces covering a total area of
Agriculture business opportunities and having potential to • Distribution of roll-over 5,350 hectares
• Period of activity: • To improve income and improve their business funds for production Realization: 2,040 hectares
FY 1999/2000 welfare level of farmers performance, and they inputs for brackish
• Source of fund: • To increase foreign are not expected to water farmers
Foreign loan OECF exchange through be newcomers.
(JBIC) for agricultural exporting of shrimps
and forestry sector
• Coverage: 14 districts
in 10 provinces
(continued)
ANNEX I (continued)
TARGET
ALLOCATION
22. Prakarsa Khusus To provide employment Women from poor • Generating job Total budget allocated:
Bagi Penganggur opportunities for poor households without opportunities and 75 billion rupiah
Perempuan (PKPP) unemployed in urban permanent jobs and living increasing income for Target: over 70,000
Special initiatives for areas, through programmes in urban centres, aged unemployed women, poor unemployed,
women unemployment they themselves propose 15-60 years, maximum through construction consisting of 80 per
By: Dept.of Settlement according to their need, high school graduate work and other cent females and 20
and Regional thus strengthening women’s These unemployed women activities per cent males
Development participation in are required in groups • Increasing women’s
• Period of activity: development activities to set legal small-scale role in maintaining
FY 2000 firms to be eligible to public and social
• Source of fund: state receive financial assistance facilities
budget for projects/activities • Empowering women
• Coverage: in medium, they propose in community
large and metropolitan development activities
cities in 6 provinces • Increasing economic
(North Sumatera, potential of female
Jakarta, West, Central workers, such as through
and East Java, and the development of
South Sulawesi) productive activities for
women
22 Padat Karya To provide employment Men and women from • Construction and Total budget allocated:
Perkotaan (PKP) opportunities for poor poor households without improvement of 366 billion rupiah
Urban labour-intensive unemployed in urban areas permanent jobs and living urban infrastructure Target: 400,000 poor
By: Dept. of in urban areas, aged • Operation and unemployed, consisting of
Settlement and 15-55 years, maximum maintenance of existing 20 per cent females and
Regional Development high school graduate urban infrastructure 80 per cent males
• Period of activity: and registered at job-
FY 2000 seekers registration units
• Source of fund: (at sub-district level)
state budget
(continued)
205
206
ANNEX I (continued)
TARGET
ALLOCATION
• Coverage: 59 districts/ • Generating job

municipalities in all opportunities and
provinces increasing income for
unemployed women,
through construction
work and other activities
• Increasing women’s role
in maintaining public and
social facilities
• Empowering women in
community development
activities
• Increasing economic
potential of female
workers, such as through
the development of
productive activities
for women)
ANNEX II
Criteria of poor families categorized as Pre-prosperous family (PKS)
and Prosperous I (KS I) according to the National Family
Planning Coordinating Agency
A family is defined as pre-prosperous if it does not meet a minimum of one of the

following five criteria:
1. All family members are able to practise their religious principles;
2. All family members are able to eat at least twice a day;
3. All family members have different sets of clothing for home, work, school and
visits;
4. The largest floor area of house is not made of dirt; and
5. The family is able to seek modern medical assistance and family planning
services for sick children and contraceptive users.
A family is classified as prosperous I if it does not fulfil any of the following
criteria:
1. All family members are able to practise their religious principles;
2. The family is able to consume meat, fish or chicken at least once a week;
3. Each family member has at least one new pair of clothing every year;
4. Per capita house space area is a minimum 8 square metres;
5. All family members have been healthy for the last three months;
6. At least one family member aged 15 years or over has a fixed job/income;
7. All family members aged 10-60 years old are able to read and write;
8. All children aged 7-15 years are enrolled in school;
9. If the family has 2 or more living children and are still of the reproductive age
group, then the couple uses contraceptive;
10. The family has the ability to improve its religious knowledge;
11. The family is able to save part of their earnings;
12. The family is able to eat together with all members at least once per day, to
communicate among family members;
13. The family takes part in local community activities;
14. The family undertakes recreational activities outside home at least once every six
months;
15. The family is able to get access to information from newspapers, radio,
television or magazines; and
16. All family members are able to use local transportation facilities.
207
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PART FOUR

Social Safety Nets in Indonesia:

A. Impacts of the 1997 economic crisis

B. Objectives of the study

The present country study has the following objectives:

Table 1. Indonesia: Poverty line, estimated number and percentage

Poverty line Percentage of poor people Number of poor people

1976 4 522 2 849 38.8 40.4 40.1 – 10.0 44.2 54.2 –

1996a 42 032 31 366 13.6 19.9 17.7 – 9.6 24.9 34.5 –

Table 2. Indonesia: The averaged nominal (and real) expenditure, 1996-1999

Lowest Middle Highest Lowest Middle Highest

Source: Irawan and Romdiati (2000).

Several programmes were implemented as part of the anti-poverty strategy. Among

The Government also launched direct intervention programmes aimed at alleviating

D. Social security schemes

A compulsory health insurance scheme for public servants, first introduced in

A savings and insurance scheme for Government employees established in 1977

II. SELECTED SOCIAL SAFETY NET PROGRAMMES

B. Food subsidy programme

After major revisions in programme design and operation, in response to the

C. Scholarship and block grants for primary

The scholarship programme was developed as an effort to prevent a large number of

In addition, the Government, through the stay-in-school programme, extended support

• High response in preventing a decreased enrolment rate and quality of education

D. Programmes in the health sector

Several independent studies on the performance of social safety net programmes in

E. Supplementary food for primary school students

Since mid-1996, Indonesia has undertaken a national school-feeding programme to

The supplementary food programme is a multi-sectoral programme. Because of this,

In designated regions implementing the programme to overcome the impact of

G. Programme of empowerment for the regions

Finally, a programme focusing on the empowerment of regions to overcome the

H. Monitoring and evaluation

A. Strengths and weaknesses

The National Planning Agency (BAPPENAS) itself as one of two implementing

Table 3 provides an example of various practices of fund misuse potentially occur-

Table 3. Fund misuse in the implementation of PDM-DKE and AMP programmes

1. Poor financial accountability: 8 935 26.4

Table 4. Percentage crude estimates of fund misallocation and leakage in the

Allocated fund Estimated misallocation/ Percentage

Food subsidy of OPK 5 450 116.7 2.1

B. Safeguarding the social safety net programmes

In pursuit of transparency, the implementing agencies of social safety nets were

In reviewing the performance of information dissemination, the question has arisen as

As a starting point to increase accountability of programme implementation, social

The transparency and accountability of implementation can be improved and where

The Coordinating Team and all programme implementing agencies established a

Table 5. Complaints received and handled by the complaint resolution unit,

Complaints Under Complaints No Percentage

Special Market Operations 428 227 158 43 47.0%

Total 1,502 405 781 316 73.0%

IV. THE ROLE OF DEVELOPMENT PARTNERS

A. The role of the Government

Figure I. National social safety net organizational setting

COORDINATING CONTROLLING INDEPENDENT MONITORING

COORDINATING INDEPENDENT MONITORING

The introduction of the local stakeholders’ forum nationwide is expected to give

As indicated in figure I, civil society is expected to monitor social safety net

A. Funding through the state budget

Budget allocation (billion rupiah)

Food Securlty: 633 117 8

Education: 2 697 2 064 1 066

Budget allocation (billion rupiah)