keywords: poverty in Indonesia, alleviation poverty, empowerment, reduction the number of poor people, BPS or “Badan Pusat Statistik” (Central Statistics Agency), GOI or “Government Of Indonesia”, Rp or "Rupiah" (Indonesian currency).jpg)
INDONESIA is home to the largest Muslim communities in the world. Although 88% of its population are Muslims, Indonesia is not an Islamic state. Indonesian Muslims are well-known for their moderation and being tolerant. Indonesia with 215 million people is 3rd democratic biggest country –after India (1,1 billion) and US (276 million). The population of Indonesia is the fifth largest in the world, after the People's Republic of China, India, the Soviet Union and The United States of America. The growth of Indonesian people is 2,3 % / 2,5 % per year that at present it has achieved - 170 million people and it is estimated to become 250 million people in the year 2000. It terms of geography, 61,9 % of Indonesia's population is found on the island of Java whose territory accounts for only 7 % of the whole of the Indonesian territory..jpg)
Indonesia is located between 6o08’ north and 11o15’ south latitude, and 94o45’ to 141o05’ east longitude. The Republic of Indonesia is divided administratively into 32 provinces (26 provinces in 1999). The provinces were further subdivided into 420 regencies. Indonesia has a total area of 9.8 million square kilometer. As a maritime country, it comprises of sea area of 7.9 millions square kilometers (including Exclusive Economic Zone) or 81 percent of total area; and some land area of about 1.9 million square kilometers. It is a country with many rivers and volcanoes, 52 of them are active volcanoes. Indonesia’s population is heavily concentrated in Java Island, which inhabited by around 59,19 percent, although the area of Java is only 7 percent of total Indonesia. Meanwhile Maluku and Irian Jaya, which have around 26 percent of total area, are inhabited only by 2 percent of total population. According to the total number of population that sex ratio of Indonesian population in 2000 was 99.84%, in which the number of male 101,637,886 and female 101,800,313.
Indonesia possesses abundant natural resources. Its geographic position is a foundation for a high potential in economic; its coastline is the longest in the world; its climate allows continuous use of the land all year long; it has a rich amount of woods and earth minerals. They all contribute to make Indonesia an able country, but that huge potential hasn’t contributed much to the welfare of the people. The population still suffers from poverty, marked by vulnerability, powerlessness, isolation, and inability to express aspiration. In turn, those conditions lead to : (i) high level of the people’s social-economic burden, (ii) low level of human resource’s quality and productivity, (iii) low level of the people’s participation, (iv) decreased quality of public order and safety, (v) decrease in trust to bureaucracy and its ability to serve the people, and (vi) threat of lost generation. Unfortunately, the decline of poverty degree in the last three decades is still highly vulnerable to changes in the economic and political conditions as well as social conflicts and natural disasters in various regions. This indicates that there are several flaws in previous poverty alleviation attempts that need radical reformation. Those flaws include: (i) fixed orientation to macro-economic growth; (ii) centralized policies; (iii) mainly consists of charity purpose; (iv) treats the people as objects; (v) narrow economic-based poverty definition; (vi) generalized poverty problem assumption and solution.
Level of Development: Poverty, Education and Health
FROM history we can learning, Development do not proceed as smoothly as a predetermined plan. The life of nation and state experience various threats, challenges, resistances and troubles. Ideal life of state such as initiated by our founding fathers in the Preamble of Indonesian constitutional (Undang Undang Dasar 1945) –by realizing common prosperity, educating national life, protecting the whole nation and fatherland of Indonesia, and following world order- fluctuates up and down in its implementation. Not only problems come from within, but also outside. When trying to strengthen inside, our nation faces challenges of competition in this global era with other nations.
Economic crisis, which began in mid 1997 has increased the number of poor people in Indonesia. By the year 1997, the number of poor people was around 34.5 millions (using 1998 standard), and that is around 17.7 percent of total population. The poverty incidence increase significantly to become 49.5 millions by the end of 1998 (24.2 percent), and it decreased slightly (2.2 percent) to 48.4 millions people in February 1999. Approximately 67.6 percent of the poor families reside in rural area. By August 1999, the poverty incidence decreased further to 37.5 millions (18.2 percent), especially due to the decline in food prices. These numbers indicate, a slow but continuous, improvement in the Indonesian economy. The number of poor family in urban area increased by around 10.8 percent, from 17.6 millions in 1998 to 15.7 millions people in 1999, however in rural area, the number increased by about 2.5 percent. Education level of the Indonesian people is represented by the number of people age 5 years and over who have never attended school, which was 12.59 percent in 1999. As compared to the number in 1998, this showed a slight decreased of 0.15 percent. Another indicator, the number of people of 10 years or over, who were illiterate was 10.21 percent (5.36 percent urban and 13.46 percent rural). As compared to that of 10.58 percent in 1998 (5.08 percent rural and 13.96 percent rural), the illiterate numbers shows a slight improvement, although it is still in a poor level condition. The latest information related to health problems was taken from the National Socio-Economic Survey (Susenas-1998). The data from the previous month of the survey (January) revealed that percentage of population having: (a) health problem was 25.43; (b) birth delivery assisted by doctor/midwife/other paramedic 51.81; (c) infants immunized 92.81; and length (months) of breast-feeding to 2-4 years children 21.09
Besides, future poverty alleviation attempts need to consider following issues:
Region autonomy and decentralization. Implementations in region autonomy and decentralization policy will give the local governments an opportunity to plan, construct, and implement policies and programs that suits their local characteristics. A careful and accountable resource management by local governments that involves local community has the potential to decrease disparities in any sector.
Demand for good governance. The formation of good governance will cease the chronic growth of corruption, collusion, and nepotism practice among the governments’ officials that brought the country’s bankruptcy. Good governance will give the lower community class the opportunity to benefit from the country’s development.
Globalization. In one hand, globalization has brought an economic recovery to competitive and efficient countries in global market. On the other hand, there are threats that this system will bring economic disparity, marginalization, and social exploitation. Increase in disparity will make poverty alleviation attempts more difficult. Therefore, in order to specify causes of poverty, one cannot be limited to traditional causes such as inequality access to education, urban bias, etc. but it must consider global imbalances in complex interaction between assets, markets, and institutions
Committee for Poverty Alleviation (Komite Penanggulangan Kemiskinan/KPK).
TOGETHERNES in poverty alleviation is manifested in a stakeholder forum called Committee for Poverty Alleviation (KPK). At a common level, KPK represents an indication of Governmental initiative to invite all society components (local areas, entrepreneurs, financial institutions and banking, academics, Non Governmental Organizations, mass organizations, and social political organizations) to sit together on a forum to alleviate the poverty. The strategy of poverty alleviation is community empowerment in 2 (two) ways, that is expenditure reduction and productivity improvement. Focus of the poverty alleviation is a productivity improvement for those of productive ages (15-60 year).
In stipulating this group, besides those of productive ages, there are two other groups, namely those of not-yet productive ages (under 15 year) and those of post-productive ages (above 60 year). These three groups of ages have different treatments. Treatment for those of not-yet productive ages is through a social investment (education especially) and for those of post productive ages is through a social security. While, for those of productive ages is through a productivity improvement. The productive ages are directed to work.
Their access to the business should be more broadly enlarged. In this case, the Coordinating Minister of Social Welfare as Chairman of KPK and Governor of Bank of Indonesia signed a Memorandum of Understanding. The MoU asked Banks to channeling their credits to Micro, Small and Medium Enterprises (MSME). Credit channeling by 14 banks in Year 2002 has accounted for Rp.35,9 trillion or 116% of Rp.30,9 trillion in business plan. In Year 2003, MSME credit is Rp.42,4 trillion with the following description: Micro Credit is Rp.7,5 trillion, Small Rp.15,2 trillion, and Middle Rp.19,7 trillion. In the end of 2003 credit channeling accounted for 61%. For 2004, the business plan is Rp.38,5 trillion.
Perhaps not-relatively-good targets, or 100% of working capital (Micro Small Medium Enterprise, MSME) credit channeling, are overshadowed by prudent mechanism among banking in channeling their credits and, on the other hand, MSME have not yet been capable of fulfilling the conditions of 5Cs (character, condition of economy, capacity to repay, capital, and collateral). For that reason, KPK, in cooperation with Bank of Indonesia, have tried to draw banking near to MSME through providing Bank-Partner MSME with Konsultan Keuangan Mitra Bank (KKMB) or Business Development Services.
One of another activities of KPK is mainstreaming poverty alleviation program by sector and departmental scope or Non Government Agencies, Mainstreaming is understood as a placement of proper perspective about consistency among strategy, policy, program, goal setting, and messaging mechanism, by prioritizing role synergies among government, private sector, and society in undertaking a poverty alleviation program.
Program Compatibility in Poverty Alleviation
MAINSTREAMING is one effort to harmonize poverty alleviation program. Mainstreaming is required for some reasons. First, it is realized that at the moment Government, private sector, and society have conducted many programs directed to alleviate the poverty. But it is realized that the program has not yet answered the causes and problems of poverty. Second, there is no an integrated program exist among government agencies, inter departments (department non government), local – central governments, private sector and society in alleviating such those poverty problems.
Mainstreaming is needed due to optimization between system and implementation of monitoring and evaluating various policies and programs of poverty alleviation has not been fulfilled. On the contrary, poverty alleviation tends to be project oriented. Incompatibility to role division and understanding of poverty alleviation among Government, private sector, and society make them more ambiguous.
Result of mainstreaming by Bappenas, as Coordinator of KPK for Macro Planning, indicates that in Year 2004, poverty alleviation programs conducted by 14 institutions by sector will amount to 99 with the greatest number of fund of Rp.18,7 trillion. Of the financial sources composition, program fund for poverty alleviation is more purely funded by IDR (Rupiah). Foreign loan in Year 2004 for poverty alleviation is only 17%. It shows that poverty alleviation program through domestic resources have been a commitment among institutions by sector. Poverty alleviation program fund growth Year 2002-2004 is illustrated in the following table. (sorry guys the table couldn’t attach).
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The above data shows that, during the last 3 (three) years, a greater allocation of fund to poverty alleviation is carried out by Bulog (Logistic Affairs Agency), Depdiknas (Department of Education), Depkes (Department of Health), Depkimpraswil (Department of Regional Infrastructure and Settlement), Depdagri (Department of Home Affair) and Depsos (Department of Social). While, agencies such as Depsos, Depkimpraswil and Depdiknas have carried out the most various types of poverty alleviation programs.
Poverty alleviation program can be conducted both directly and indirectly. Direct program in natures is that whose beneficiary and target group are the poor. This direct poverty alleviation program amounted for 71 or 72% with a total fund of Rp.17,55 trillion.
Indirect program in nature is generally that supporting the effort of poverty alleviation, such as policy facilitation and data and information preparation carried out by BPS (Central Statistic Agency). This indirect program accounted for 28 with a financial value of Rp.1,2 trillion allocated to alleviate poverty.
Conclusion
In this article we emphasized that an effort to equalize a poverty alleviation program will be painful if conducted only by Government, and even only the Central Government. It needs a support of a stakeholder forum merged into a Committee for Poverty Alleviation to formulate a correct strategy and program to alleviate poverty in their local area. It is fair to conceive that society is a key factor to the efficacy of the poverty alleviation program.
If there is a PRSP (Poverty Reduction Strategy Paper) exist at center level, which according to Inpres No. 5 Year 2003, will be finished in September 2004, the activity Local KPK should do is a formulation of relevant strategy referring to their locality activity aspect. This documentation is referred to as formulation of Local PRSP. It is expected Local PRSP can realize aspiration of grassroots to collectively alleviate the poverty.
A concrete form of poverty alleviation program for productive poor is to give them working capitals. For that reason Government is required to share their roles with banking. Governmental should prepare and make MSME bankable and then, when ‘ready’, it is arrested by banking with their credit allocation. Here role of accompany combined into a KKMB becomes important. Their role is to draw MSME near to banking and accompany their business to make them ready to be competitive in market. Thereby, community (the poor one especially) is a leading actor in poverty alleviation.▀ Picture: Kelompok Usaha Bersama (KUBE or similar with "Co-partnering groups") in Klaten, 2006.
Presented by Yuniandono Ahmad, Staff of Komite Penanggulangan Kemiskinan (Committee for Poverty Alleviation), Delegation from The Republic of Indonesia at Malaysia Technical Cooperation Programme 2004, 5-25th September 2004, Institut for Rural Advancement (INFRA), Kementerian Luar Bandar dan Wilayah
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