1.Institutional Setting of Poverty Reduction/Social Protection Programs in Indonesia Vita Febriany The SMERU Research Institute 2.Institutional Issues on CCT Program

2 Programs Related to Poverty Reduction SectorNumber of Programs Number of Executing Agencies Budget (million US$) Political, Law and Security Economic related programs 69124,000 Social welfare33112,500 Total117327,000

3 Ministerial Task Force (TKPK) Launched in 2005 A cross-sectors forum Expected to accommodate all efforts to reduce poverty Consisting of: 19 ministers 3 head of bureau and other non-governmental members Chair: Coordinating Minister of People’s Welfare TKPK offices are also established at provincial and district level

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

5 Cluster ICluster II Cluster III Social Assistance Aim: to reduce economic cost burden of the poor Community Empowerment Aim: to increase the poor’s income & affordability Micro-enterprises Empowerment Aim: to increase savings & business sustainability of SMEs Main Instruments: Rice for the poor, Health Card, CCT, scholarship for the poor. Other Instruments: Social assistance for disabled, elderly, children, etc. Targets in 2009: 18.5 million the near poor, poor, and very poor households. Main Instruments: PNPM Mandiri (National Community Empowerment Program) PPK, P2KP, PPIP, PISEW, etc. Targets in 2009: 6,408 villages Main Instruments: Credit for the People (KUR) Targets in 2009: US$ 2 billion for 4 million microcredit recipients “Giving a fish”“Train how to fish” “Provide fishing rod and boat”

6 The Drawback of TKPK (Ministerial Task Force) Poor coordination across ministries Most ministers are from different political parties and interest groups Conveying diverse poverty alleviation and agenda Bureaucratic fragmentation Financial limitations Weak deciding power

7 Special Task force In Mid 2010 TKPK changed its name into the national team for poverty reduction acceleration (TNP2K). Three main tasks: To formulate the poverty reduction policy and program, To make the poverty reduction activities more synergic between ministries and institutions, To perform the monitoring and evaluation function. Led directly by the Vice President The office is next to the Vice President office Vice President checks the progress in every two weeks

8 Head : Vice President Deputy I : Coordinating Minister of People’s Welfare Deputy II : Coordinating Minister of Economic Affairs Members Executive Secretary: Welfare Affairs Deputy of Vice President Secretary Cluster 1: Household based Integrated Social Assistance (Vice President Office) Cluster 2: Community Empowerment based Social Assistance / PNPM Mandiri (Coordinating Ministry of People’s Welfare) Cluster 3: Micro-enterprises Empowerment based Social Assistance (Coordinating Ministry of Economic Affairs)

Institutional Issues on CCT program

10 CCT program in Indonesia Known as Family of Hope Program (PKH). Implemented since Transferring funds directly to women. Employing 12 health and education indicators. In 2010 covers around 800,000 poor households.

11 Institutional Issues of PKH At central government: between ministries Between central and local governments At village level

12 Between Ministries PKH is a demand driven program. Managed by The Ministry of Social Affairs (MoSA) Inter-sectors coordination is provided by a central coordinating team MoSA is considered as lack of credibility compared to other ministries Difficult to ensure other ministries' support and commitment

13 Between Central and Local Governments PKH is a central government program. Indonesia is a very decentralized country with autonomy lies at the district government. PKH has been implemented only at selected districts. There is an MOU between central and district governments. Low level of local governments’ commitment (‘business as usual’). District health and education offices follow strategies from their line ministries and local government policy.

14 At village level Service providers at the village level follow policies at the district level. Lack of information at services providers Extra burden no additional compensation Resulted in the virtual absence of compliance monitoring.

15 PKH Institutional Interrelationship Health Office Education Office Social Affairs Office District Government Health clinicsSchools Field Facilitators Ministry of Social Affairs Ministry of Health Ministry of Education Central District Village MOU