JP:Govt dismisses reports of social safety net fund misuse (fwd)

[Robert Weissman <rob@essential.org>]

Jakarta Post
Saturday, April 24, 1999
Govt dismisses reports of social safety net fund misuse
JAKARTA (JP): Coordinating Minister for People's Welfare and Poverty
Eradication Haryono Suyono dismissed on Friday reports of alleged misuse of
Rp 8 trillion (US$890 million) of social safety net funds, arguing it was
only a matter of "lmbalance between supply and demand".
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Haryono said the only problem facing the government was that there were
more
poor people than could be covered by the money allocated for the 1998/1999
fiscal year.
"It is not a matter of (the money being given to) the wrong targets, but
not
all of the targeted poor people can be helped," Haryono said after
attending
a meeting of the Council for Enforcing Security and Law at the State Guest
House chaired by President B.J. Habibie.
Gunawan Sumodiningrat deputy head of the National Development Planning
Agency
(Bappenas), revealed in a seminar on Thursday that at least Rp 8 trillion
of
the total Rp 17.9 trillion social safety net funds for the 1998/1999 fiscal
year had failed to reach its intended targets,
namely laid-off workers and people facing food shortages.
Bappenas' deputy head of regional affairs, Herman Haeruman, said only about
Rp 9 trillion of the funds had been properly channeled to provide
subsidized
rice for the poor, and to subsidize agriculture, health care and education.
The World Bank has told Bappenas to stop using the funds for
labor-intensive
projects and poverty alleviation programs, said Herman.
The World Bank has delayed the payment of a US$600 million loan to
Indonesia,
scheduled to be disbursed on March 31, because the government failed to
provide a reliable system to monitor the allocation of the money for its
poverty-alleviation program.
Opposition parties and nongovernmental organizations (NGOs) alleged the
government had used the money to ensure votes.
The World Bank has pledged Indonesia $4.5 billion as part of a wider
bailout
package led by the International Monetary Fund begun in 1997 . It increased
the pledge to $5.5 billion last year, but so far has yet to disburse even
half of that amount.
"Now we are still negotiating with the World Bank, the Asian Development
Bank, that (the program) can be implemented more appropriately next year,"
Haryono said.
However, he acknowledged the government did not have comprehensive data on
needy people before distributing the fund, and that it was therefore
possible
the money did not reach the most impoverished people.
"The data is ... not specifically prepared for the social safety net
program
" Haryono conceded.
On the same day, State Minister of National Development Planning Boediono
said the government would not stop the program as it would worsen people's
suffering.
"People will suffer more if it is stopped," said Boediono.
Boediono, also the Bappenas head, expressed his readiness to involve more
NGOs and students in the program in order to help the government reach its
objectives.
This offer, however, was criticized by outspoken economist Sri Mulyani as a
half-hearted gesture. She also pointed out that the ruling Golkar party
had,
through the bureaucracy, claimed the money belonged to the party.
Wardah Hafidz, coordinator of Urban Poor Consortium (UPC), criticized
Bappenas for holding only two workshops, attended by 300 people, for the
fund
disbursement.
"HOW can only 300 participants speak on behalf of the people, when the
problem is so complex?" she was quoted by Antara as saying.
About 1,000 protesters from the City Poor People's Party marched to
Bappenas
on Thursday, demanding that the government stop the program because it only
increased the burden on people.
They warned the World Bank would extend the money as a loan, not a
donation,
and that future generations would bear the burden of repaying those debts.
Meanwhile in Maumere regency, East Nusa Tenggara, a local health ministry
official has allegedly deposited at least Rp 420 million of the social
safety
net fund allocated to the ministry to take advantage of the bank's
lucrative
interest rate.
Iskandar, however, insisted he put the money in the BRI bank to enable the
of
fice to quickly channel the fund to remote areas.
In Jakarta, Bambang Shergi Laksmono, a sociologist at the University of
Indonesia claimed that Jakarta city officials avoided poor people because
they did not trust their ability to repay the safety net loans.
"The officials are afraid of failure if their clients (fund recipients) do
not return this loan, and therefore they prioritize people who have
permanent
jobs," Bambang said in his doctoral dissertation.
Bambang defended his dissertation titled Understanding the Access Problem
in
the Poverty Alleviation Program' in a ceremony at the university campus in
Depok, West Java.
His study attempted to prove that government officials thought more about
their own careers than serving the public interest. Their main concern was
ensuring that recipients of the fund repay debts on time.
The officials had apparently also complained because they were given only
two
weeks to complete their tasks. (prb/yac)