Economist: KDKMP aligns with the founding fathers' economic vision

Economist Surya Vandiantara has assessed that the Merah Putih Village/Sub-district Cooperative Programme (KDKMP) aligns with the economic ideas of the nation’s founders, who positioned cooperatives as a form of mutual cooperation economy based on the principle of kinship. “The main idea behind the establishment of cooperatives by the founding fathers was to advance the economy through mutual cooperation without discriminating between classes or groups in society,” said the academic from the University of Muhammadiyah Bengkulu in a statement in Jakarta on Sunday. Surya explained that this concept is in line with Article 33 of the 1945 Constitution, which mandates that the economy be structured as a joint endeavour based on the principle of kinship. Cooperatives are one form of implementing this constitutional mandate. According to him, the main characteristic of a cooperative is the spirit of mutual cooperation. The community pools funds as collective capital, which is then used to help one another through a savings and loan scheme. “This mutual cooperation principle, in the savings and loan cooperative scheme, is implemented through members’ principal savings and mandatory savings, which then become a source of loans for other members, for both productive and consumptive activities,” he said. Surya stated that the government, through KDKMP, is trying to bring the cooperative concept down to the grassroots level. In this scheme, the state intervenes through capital support sourced from tax revenues, but remains based on the principle of mutual cooperation. “Unlike savings and loan cooperatives that rely on member savings, the management of KDKMP relies on tax revenues collected from the public to help other communities. Thus, the principle of mutual cooperation remains the main foundation,” he said. “This KDKMP innovation is able to answer the classic problem of previous cooperatives, which struggled to invite people to become members due to their inability to pay principal and mandatory savings,” he added. Nevertheless, Surya reminded the government to implement transparent governance in the execution of the programme. According to him, budget transparency must be strengthened through regular supervision and financial audits. Previously, Minister of Cooperatives Ferry Juliantono stated that the construction of KDKMPs across Indonesia is a concrete implementation of the people’s economy concept championed by President Prabowo Subianto. According to Ferry, KDKMP is part of an economic idea known as Prabowonomics, a development approach that places the people at the centre of national economic growth while correcting the direction of the economy, which is considered too liberal and capitalist.