SMERU Publication

Research Report
Topic: Economic Policy, Governance, Policy Analysis, Poverty Reduction Program, Social Protection

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Review of Government’s Poverty Reduction Strategies, Policies, and Programs in Indonesia

ABSTRACT

Poverty reduction has become a major policy initiative in Indonesia since the advent of the economic crisis in 1997/98. When the economic crisis hit Indonesia started in mid 1997, the government established the social safety net (JPS) program, covering food security, health, education, employment creation, and community empowerment. This JPS program becomes the initial undertaking of various poverty reduction and social protection programs implemented by successive governments in the post-crisis period. Currently the government strategy in poverty reduction is formulated through a clustering of poverty reduction programs into three clusters based on the objectives and targets of these programs. The first cluster is social assistance, with the objective of providing direct assistance to poor households to ease their burdens in meeting basic necessities. The second cluster is community empowerment, with the objective of providing social fund to poor communities that they can use to improve basic social and economic services according to their own priorities. The third cluster is microenterprise empowerment, with the objective of providing access to credits for microenterprises without being hindered by the requirement of having to provide collaterals. Evaluation of the effectiveness of these programs in achieving their stated objectives, have shown mixed results.Among the efforts to increase the effectiveness of poverty reduction program, the government has recently established a national team for accelerating poverty reduction, chaired by the Vice President. This shows the level of commitment of the government in achieving its target in poverty reduction.

LIST OF CONTENTS

ABSTRACT
LIST OF CONTENTS
LIST OF TABLES
LIST OF FIGURES
I. BACKGROUND
II. RECENT DEVELOPMENT IN POVERTY REDUCTION STRATEGIES AND POLICIES

2.1. Poverty Reduction Strategies and Policies

2.1.1 A Road to the National Strategy for Poverty Reduction
2.1.2 Review of the Medium Term Development Plan 2004-2009
2.1.3 Review of the Medium Term Development Plan 2010-2014
2.1.4 Review of the Regional (Local) Poverty Reduction Strategies and Policies

2.2 Institutional Setting of Poverty Reduction

III. MAJOR POVERTY REDUCTION PROGRAMS

3.1 Review of the Social Assistance Cluster of Government’s Poverty Reduction Programs (Cluster 1)

3.1.1 Protecting Staple Food Consumption of the Poor
3.1.2 Protecting Health of the Poor
3.1.3 Protecting Education of the Poor
3.1.4 Protecting Financial Liquidity of the Poor

3.2 Review of the Community Empowerment Cluster of Government’s Poverty Reduction Programs (Cluster 2)
3.3 Review of the Micro-Enterprise Empowerment Cluster of Government’s Poverty Reduction Programs (Cluster 3)

IV. CONCLUSION AND POLICY RECOMMENDATION

4.1 Conclusion
4.2 Policy Recommendation

4.2.1 Institutional Capacity in Managing Reduction of Poverty and Vulnerability
4.2.2 Quality of Reforms in Poverty Database and Targeting Strategy
4.2.3 Integration and Quality Improvement of Social Assistance, Community Empowerment, and Micro-Enterprise Empowerment Programs

REFERENCES