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Social Protection in Indonesia

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Presentation on theme: "Social Protection in Indonesia"— Presentation transcript:

1 Social Protection in Indonesia
Ester Fitrinika HW Directorate of Social Protection and Welfare National Development Planning Agency – Republic of Indonesia Seminar on “Social transfer in the fight against hunger” Pnom Penh-Cambodia, 21-23th of February, 2013

2 - Area : km2 (no.6 biggest country after Canada, USA China, Brazil, Australia) island. - Population : 240 million (no.4 highest population after China, India, USA)

3 BACKGROUND OF SOCIAL PROTECTION IN INDONESIA
1. Economic shock in 2005/6 due to the oil price hiked made the gov’t had to shift from commodity subsidy to household subsidy. Indonesia have a significant number of the poor, thus commodity subsidy is unfair for the poor Targeted household subsidy (Unconditional Cash Transfer (UCT) then transformed to CCT in 2007, Health insurance, Scholarship, and Rice for the Poor) as an embryo to Social Protection 2. Due to internal political pressure, Indonesia have to prolong fuel price subsidy to maintain its low price domestically. As a result: Price difference between domestic price and international price. Big burden and uncertainty in government budget.

4 Dimension of Poverty in Indonesia
Three characteristics of poverty A significant number of vulnerable Non-monetary Poverty Interregional disparity Access inequality in health, nutrition, education, water & sanitation, etc., especially for the poor in remote and isolated areas Poverty rate across regions, 2009

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6 Rural-Urban Disparity
Poverty Rates in Rural and Urban Areas Gini ratios in urban and rural areas Source: BPS, Susenas 2011

7 CURRENT SOCIAL PROTECTION SCHEME
MACRO ECONOMIC POLICY Social Insurance Pension. Old Age Security. Health. Work Injury. Death. Social Assistance Credit Facility to SMEs Cluster 3 National Program on Community Empowerment (PNPM): Urban, rural, rural infrastructure, less-dev’d regions PNPM Generation (+Nutrition) Cluster 2 Scholarship for the poor Supplemental food for School Children Program Subsidized Rice CCT & CCT-Nutrition (for the poorest) UCT Disabled Children with adversity Neglected old ages Indigenous communities Cluster 1 Poverty targeting beneficiaries by unified database – 2011, with validation, verifikation, community poverty mapping.

8 Spending Priority of State Budget
2005 2006 2007 2008 2009 2010 2011 2012 Transfer to region 26.63 32.36 33.67 29.55 30.84 30.61 31.14 33.18 Subsidy 21.38 15.36 19.96 27.82 13.80 17.11 22.37 19.03 Education 13.89 17.59 18.90 15.58 20.81 20.00 20.21 20.20 Poverty Programs 4.14 6.67 7.06 6.12 8.00 7.23 7.10 6.91 Health 2.26 3.22 3.26 2.47 2.78 2.81 3.32 3.34 Agriculture 2.51 2.59 2.98 4.15 4.33 4.13 3.82 3.76 Infrastructure 4.62 7.72 7.95 9.12 8.83 9.51 11.25 Total Spending 100.00 Source: LKPP audited, except 2011 (unaudited) and 2012 (APBN-P)

9 Malnutrition in Indonesia
Angka stunting di Indonesia 37%,peringkat ke 5 di dunia. Try to achieve 32% in 2014 (end of Mid Term Development Plan National) Will achieve 32% stunting in 2014 (end of MTDP)

10 Social protection related to food and nutrition:
Supplemental food for School Children Program (1997, 2010): - to contribute to acceleration of achievement of national development goals related to: overcoming malnutrition (the incidence of stunting in children aged 6-14 years was 13.3 % for boys and 10.9 % for girls) – universal Subsidized Rice (foor the poor): - Subsidy to rice price for very poor h.h - Deliver by local government (using the data from Central Statistic Agencey)

11 CCT (2007) & CCT-Nutrition (for the poorest, start 2013):
- CCT: for pregnat mother and children up to 18 years (junior high school) to access health and education – #20 - Nutrition intervention for pregnant women up to 2 years old children  to reduce stunting. Pilot project in 2 prov. - in 2007 using data frm Central Statistic Agency, starting 2012 using “unified data base” UCT (Unconditional Cash Transfer) aimed to reach one-third of Indonesian households to provide some compensation for the reduction in the fuel subsidy at a time of rapid fuel and food – particularly rice – price inflation. Cash was disbursed in several rounds in and again in  30 $/month. PNPM Generation (CCT with nutrition program through community empowerment) CCT benefit scenario: slide 17.

12 Malnutrition in Indonesia
Angka stunting di Indonesia 37%,peringkat ke 5 di dunia. Jumlah anak balita stunting di Indonesia 7,688,000. Terbesar jumlah stunting di Indonesia Bagian Timur (NTT dan NTB), tetapi juga di Jawa (lebih dari 35 % di Jawa Timur dan Jawa Tengah) Will achieve 32% stunting in 2014 (end of MTDP)

13 THE WAY FORWARD (PLANNED)
2012 – 2014: Accelleration of poverty reduction strategy. : Transformation of poverty reduction program: Consolidate poverty alleviation programs (social assistance)  complementary, well targeting Strengthening social insurance program. “Master Plan of Poverty Reduction Acceleration in Indonesia” as complementary of “Master Plan of Economic Development in Indonesia”.

14 Pengurangan Angka Kemiskinan
Cluster-4 PROGRAM RUMAH SANGAT MURAH PROGRAM KENDARAAN ANGKUTAN UMUM MURAH PROGRAM AIR BERSIH UNTUK RAKYAT PROGRAM LISTRIK MURAH & HEMAT Program Peningkatan Kehidupan Nelayan *) Program Peningkatan Kehidupan Masyarakat Miskin Perkotaan *) Peningkatan Kesejahteraan Masyarakat, serta Perluasan dan Peningkatan Kesempatan Kerja Pengurangan Angka Kemiskinan RTSM *) RTM *) RTHM RTSM RTM Cluster-1 BEASISWA MISKIN JAMKESMAS RASKIN PKH BLT (bila diperlukan saat krisis) Dll. Cluster-2 PROGRAM-PROGRAM PEMBERDAYAAN MASYARAKAT (PNPM) Cluster-3 UMKM, KREDIT USAHA RAKYAT (KUR) MACRO ECONOMIC POLICY

15 MP3EI MP3KI Increase economic growth, inclusiveness & equity
CSR or NGOs Local Gov’t Synergi of cluster 1, 2, 3, & 4 Access to Conectivity Arec Increase economic growth, inclusiveness & equity Reduce the poverty level Increasing job creation Equal economic dev’t in the whole country

16 Terima kasih Thank You

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18 PKH (Family Hope Program) Indonesia’s CCT
Objective: Contribute to the acceleration of MDGs Break the circle of poverty chain for future generation Reduce child and maternal mortality  Indonesia is among the highest in SE Asia. Improve education attainment of poor Improve the quality of human resources through improvement in access to health and education services for the poor

19 PKH DESIGN ELIGIBILITY. CCT to the poorest households (based on PMT targeting) which have expecting or lactating mothers and children between years old. TIMELINE. PKH will be conducted from 2007 to 2020: Original design assumed beneficiaries remain in the system for a max of 6 years. SPATIAL EXPANSION. Through phased expansion now reaches 25 of the 33 provinces. COVERAGE AND BUDGET. Total number of beneficiaries 2011 estimated at 1.1 million HHs at a cost of $177,7 million; and for 2014 will target 3.0 million HHs at a cost of US$466,6 million. BENEFIT. Benefit ranges from a flat benefit of US$60 (min) to max of US$220 per household per year.

20 Conditionalities HEALTH EDUCATION
The mother or the adult woman responsible for taking care the children in the family receives cash if: She goes to a nearby health facility for pre and post natal check-ups; and or Children under 5 years old receives regular immunization and check-ups. EDUCATION The mother or the adult woman responsible for taking care the children in the family receives cash if: Their school year old children are enrolled in a school for basic education, and Their children attend the school with minimum 85% attendance.

21 Annual Benefit per Poor HH
BENEFIT SCENARIO Benefit Scenario Annual Benefit per Poor HH Fixed Benefit $ 20 Additional Benefit for Poor HH who has: Children under 6 years old Pregnant/lactating mother Children in elementary school age Children in junior secondary school age $ 80 $ 40 Average benefit per poor HH $ 140 Minimum benefit per poor HH $ 60 Maximum benefit per poor HH $ 220 Notes: Average benefit is calculated based on 16% of total annual income of poor HH. The range for minimum and maximum benefit is between 15-25% average annual income of poor HH. Benefit scenario will be evaluated periodically.

22 Trend of PKH Budget 1. National Budget
2007 2008 2009 2010 2011 2012 2013 2014 Target (HH) Budget Rp 843 B (US$ 93,7 M) Rp 1 T (US$ 111,1 M) Rp 1.1 T 122,2 M) Rp 1,3 T 144,4 M) Rp 1,6 T 177,7 M) Rp 1,8 T 200 M) Rp 2,8 T 311,1M) Rp 4,2 T 466,6 M) *) 1 USD = ~Rp9.000 2. International support  Technical Assistance/Grant World Bank: Project preparation and evaluations GIZ (Germany) & AusAID: Technical expertise on management improvement UNICEF: additional intervention for stunting (pilot phase)

23 PKH Future Plan Achieve the coverage for all poorest families in accordance to target of the National Mid Term Development Plan (RPJMN) Preparing “Exit Strategy” to guarantee the “graduate beneficiaries” to have a fundamental transformation of livelihoods Re-certification to measure the progress of socio-economic condition of beneficiaries Transition and graduation schemes to link beneficiearies to other related social protection programs (i.e: scholarship, health insurance, rice subsidy, livelihood, etc). Strengthen cross sectoral coordination related to local government particularly in improving supply side. Improving level of benefit and other incentives such as ‘bonus of transition’ for children of school level 6 to 9  to reduce school drop out and child labor. Continue to improve program implementation: enhancing facilitator’s quality, and synchronising benefit payment with school intake. Improve the quality of database and monev instruments (MIS, households survey).

24 Terima kasih Thank You

25 Ministerial Strategic Plan
Planning and Budgeting Process - Indonesia Level/Periods National Ministry Local 25 Years 5 Years 1 Year Long Term Plan (RPJP) Leaders’s Platform (Vision) President’s Platform (Vision) Medium Term Plan (RPJMN) Ministerial Strategic Plan (Renstra KL) Local Strategic Plan (Renstra SKPD) Annual Plan (RKP) Ministerial Workplan (Renja KL) Local Workplan (RKPD) State Budget (APBN) Detailed Workplan (RKA-KL) Local Budget (APBD)

26 Regional Disparity Poverty Rate

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28 Social Assistance Expenditure
Categories 2011 Annual Expenditure (IDR) % Assistance for Elderly 0,37% Health Assistance (Jamkesmas) 18,85% Child Protection 1,06% Disaster Assistance and Relief 1,59% Other Social Assistance (disability, old age benefits) 1,33% Rice for the Poor (Raskin) 56,43% Scholarship for the Poor 14,42% CONDITIONAL CASH TRANSFER/CCT (PKH) 5,95% All Social Assistance ,0 100,00% Share to State Budget (APBN) 2,05% Share to GDP


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