Background of the social safety net program

Background of the social safety net program

By Sri Pamoedjo Rahardjo

This is the first of two articles on the social safety net.

JAKARTA (JP): The social safety net strategy (known by its
local acronym as JPS) was first introduced in Indonesia as a
response to safeguard the most affected segment of the population
from the socioeconomic crisis in 1998. In order to ensure
implementation of the strategy, multilateral agencies stipulated
in their assistance scheme, covenants and a time frame for the
government to comply with this requirement.

Current public bickering on the social safety net scheme could
have been avoided had all parties concerned understood the
background to the scheme. On the one hand, government officials
are accused of indirectly misappropriating funds. On the other
hand, officials are apprehensive in accepting funds and disclaim
any wrong doings.

The social safety net had become a target for disagreement.
The current debates have developed because of confusion in the
meaning of the scheme. The concept is mixed up with that of
poverty alleviation. Although both concepts have the same target
groups -- the poor -- the underlying visions and mechanisms
differ from one another. In reality, the social safety net and
poverty alleviation are two sides of the same coin, but mixing
these two, results in confusion in the program's implementation.

Poverty is a phenomenon of social institutions. Society
organizes itself by creating social stratifications and roles.
The stratification suggests social differentiation and the
division of labor, creating cooperation, competition and conflict
to obtain limited resources. In other words, the poor are a
social fact; those who failed in the competition for resources.
Poverty does not become a social problem until some segments of
society reach a certain level of affluence.

Similarly, in Indonesia the issue of poverty came into the
limelight as some people's welfare improved because of rapid
economic growth in the late 1980s. As the social gap widened, the
government introduced various social development programs under
the auspices of the concerned ministries.

During the crisis, as the government began to lose the
capacity to control its development plans, the International
Monetary Fund (IMF) recommended that the government introduce
social safety net measures in its development schemes. According
to its mission, social safety net schemes are a device to help
save communities from a crisis-induced destitution. The process
to identify, select and assist the target groups has to be
administered in a speedy and focused manner. According to its
vision, the scheme is an approach to reach the most vulnerable
groups, whose capacity to meet challenges is affected by the
crisis. Within a period of time, the plan aims to help the groups
concerned to move on to more sustainable means of development.

As a strategy in social development, poverty alleviation aims
to deal with transformation of family structures. It is a long-
term activity. In poverty alleviation, the family as an
institution is the target. The family is stimulated to achieve
sustainable long-term changes. On the contrary, in social safety
nets, the community institution is the target. The aim is to
rescue some members of the community and stimulate them to
recover their capacity to survive in the short-term. While both
approaches have the same target groups and impact on poverty
levels, over a period of time, the management of poverty
alleviation and social safety net schemes is not similar.

The contrast between these approaches suggests that the
government should avoid using these two strategies
interchangeably. Failure to recognize the difference will only
result in confusing the target groups for poverty alleviation and
the social safety net.

In the past, the government always reinforced its development
programs with social development strategies for the poor.
Programs like income generation, mother and child health care,
nutrition, immunization, cooperatives and assisting women in
development activities are some notable examples. These were
usually designed as support infrastructures to create demand.

In the early 1980s, the government increased community
participation in its expanded program activities. This was
reflected in the structure of government agencies dealing with
community development issues, including increased human resources
and operational budgets. At the time, the objective was mainly to
obtain program sustainability; the policy was to employ
appropriate field workers from all sectors (penyuluh lapangan) to
work with village volunteers. All the donors supported, if not
demanded, that these workers be fielded in each different
project.

Early in the 1990s, hostile attitudes toward centrally
supported field workers emerged. These reactions were a result of
confusion at the village level. Village leaders and the community
were confronted with a great many sectoral interests. The
performance criteria of village, sub-district, district and
provincial leaders was based on their success in accommodating
these overlapping and, in some cases, conflicting activities.

When the crisis hit the country in 1998, the number of the
poor increased drastically. Strategies to deal with the poor in
the community were re-conceptualized as social safety net
actions. Despite the good intention, the move seems to have
resulted in another misunderstanding at the central and lower
administrative levels. The lower echelons were apparently not
clear on the change of visions and missions. The requirements to
maintain clarity, transparency and accountability -- which were
not demanded as urgently before -- were regarded as additional
burdens. In the past, the funds were directed toward the service
providers. Now, funds are directly disbursed to the target
groups.

Public groups have recently accused the government of
mishandling the social safety net funds. Most of the Rp 17.8
trillion allocated is thought not to have reached the appropriate
targets. Some ministry officials are confused about social safety
net funds in their budget items. They appeared unaware that their
budget items were labeled as social safety net funds. As a
result, the ministry concerned released the funds as usual, with
the possible outcome of mishandling of the funds. This could be
the reason why many fingers now are pointing at the non-compliant
nature of the administrative and disbursement scheme of social
safety net funds.

The writer is a social and economic observer, and former
regional development bank officer in Manila.