Economic Growth and Poverty Reduction in Indonesia Before and After the Asian Financial Crisis

This paper assesses the relationship between economic growth and poverty reduction in Indonesia before and after the asian financial crisis (afc). Indonesia has a significantly slower poverty reduction post-afc compared to the pre-afc era. the trend in the growth elasticity of poverty indicates that the power of each% of economic growth to reduce poverty did not change greatly between the pre and post-afc time periods. during both these periods, the growth of services sector is the largest contributor to poverty reduction in both rural and urban areas. post-afc, industrial sector growth has become largely irrelevant for poverty reduction even though this sector makes up the second largest share of gdp. meanwhile, the importance of agricultural sector growth for poverty reduction is confined only to rural areas. finally, the findings suggest that there is a need to promote economic growth in all sectors as the current rates are insufficient to recover to the rates of poverty reduction in the pre-afc era. keywords: poverty, sectoral growth, asian financial crisis, growth elasticit

Rapid Appraisal of the 2011 Data Collection of Social Protection Programs (Ppls 2011)

Research team smeru researchers hastuti, syaikhu usman, bambang sulaksono, r. justin sodo, asri yusrina, rahmitha, gracia hadiwidjaja, prio sambodho field researchers: basyri nasution, muhammad imam zamroni, asep kurniawan, muhammad badar translators: stephen girschik, mukti mulyana, budhi adrianto abstract to support the implementation of numerous social protection programs and the development of a unified database for social protection programs, statistics Indonesia (bps), in coordination with the national team for accelerating poverty reduction (tnp2k) and world bank, conducted the 2011 data collection for social protection programs (ppls 2011). ppls 2011 was implemented in order to build a unified database system containing information on all the 40% poorest households in Indonesia which will be used for the purpose of targeting social protection programs to eligible beneficiaries. to achieve this goal, around 45%-50% of low to lower middle socioeconomic households have been enumerated as part of the ppls 2011 implementation. in order to assess the quality of ppls 2011, the smeru research institute carried out a rapid appraisal of its implementation in four provinces covering eight kabupaten/kota, and sixteen villages/kelurahan. this appraisal was formulated based on interviews with bps staffs in kabupaten/kota and kecamatan (ksk), regional government officials, field enumerators (pcl), field supervisors (pml) and 253 households. in this qualitative study, smeru also observed training, data collection, data verification and data entry activities. in this appraisal, smeru finds that ppls 2011 has a number of improvements compared to previous data collections used to determine social protection program beneficiaries, namely the 2005 socioeconomic census (pse 2005) and the 2008 data collection for social protection programs (ppls 2008). some of these improvements are: a far greater coverage of households, clearer standard operating procedures (sop), the use of pre-listed lists of households as starting points based on technical analysis of census data, the neutral association of ppls 2011 to any programs, and the more detailed household information.meanwhile general criticisms of ppls 2011 are: the survey was perceived as being too centralized and/or insufficiently able to accommodate local socioeconomic characteristics, socialization to the community was limited, the criteria of low to lower middle socioeconomic households were not clear, and there were indications of possible under-coverage of households in some areas. this study offers several important recommendations that may be useful for future rounds of data collection for social protection programs. first, a fine, precise and firm explanation on the purpose of ppls should be given to all stakeholders, including the general population. second, in order to get high quality partners, enumerators must be recruited through an open and objective recruitment process. third, more precise and clearer definitions of what constitutes a low to lower middle socioeconomic household should be defined well in advance. fourth, training and field supervision activities should be improved. keywords: poverty, unified database, middle to low socioeconomic household, social protection program

Financial Consequences of Ill Health and Informal Coping Mechanisms in Indonesia

We assess the financial risk of ill health for households in Indonesia, the role of informal coping strategies, and the effectiveness of these strategies in smoothing consumption. based on household panel data, we find evidence of financial risk from illness through medical expenses, while income from informal wage labor is exposed to risk for the poor and income from self-employed business activities for the non-poor. however, only for the rural population and the poor does this lead to imperfect consumption smoothing, while the non-poor seem to be able to protect current spending. borrowing and drawing on buffers, such as savings and assets, seem to be key informal coping strategies for the poor, which infers potential negative long term effects. while these results suggest scope for public intervention, the financial risk from income loss for the rural poor is beyond public health care financing reforms. rather, formal sector employment seems to be a key instrument for financial protection from illness, by also reducing income risk. key words: illness, income, consumption smoothing, coping strategies, Indonesia jel: o15, i1

Monitoring and Evaluation of Development Programs in Five Ministries: a Study on the System and Implementation

The system of planning and budgeting in Indonesia is undergoing a change, from an input-based system to one based on output and outcome. information accountability in monitoring and evaluation is a must to support the implementation of a performance-based system as mandated by law no. 17/2003 on state finance, and government regulation no. 21/2004 on formulating ministerial/institutional work plans and budgets. an evaluation needs to be conducted on government regulation no. 39/2006 on procedure of monitoring and evaluation of development plan implementation to accommodate the output – and outcome –based planning and budgeting system. this study presents snapshots of the monitoring and evaluation system of government programs which have been implemented in five selected ministries. the methods used include conducting in-depth interviews with staff members and collecting secondary ministerial-level data at both the planning bureau (bpkln) and directorate general/program executing directorate; distributing questionnaires on budget absorption and achievement of targeted output/outcome indicators of selected programs; and conducting a field study on monitoring and evaluation systems and processes of data validation at the local level. this study recommends that the monitoring and evaluation process should be placed parallel with the planning, budgeting, and implementation processes of the programs/activities. therefore a regulation regarding monitoring and evaluation management in national and local level government agencies is needed. it should provide clear definitions of monitoring and evaluation and address the need for an independent monitoring and evaluation unit; reward and punishment mechanisms; a feedback mechanism; and simplification of forms, number of reports, and indicators of programs/activities. keywords: monitoring, evaluation, programs, ministr

Associations of Child Poverty: Patterns and Differences

This paper examines the different dimensions of child poverty in Indonesia, looking at child outcomes and opportunities across consumption, health, education, housing, food security, social assistance and infrastructure. In addition to looking at each of these measures, we go further to investigate the associations between them, asking whether it is the same children who are poor on each dimension or different ones. For example, we look at the associations between physical access to education, health and transportation services; and consumption, housing, water and sanitation; whether money poor and food poor children are the same; the linkages between access to health services and social assistance and health outcomes; and associations between barriers to enrolment. These associations have important implications for program design and targeting. We present results over time, as well as for different populations of interest, such as rural, urban and female-headed households