Goverment says no threat from World Bank

JAKARTA (JP): The government denied reports on Thursday that the World Bank had threatened to stop funding the country's social safety net program because of the ineffective distribution system.

State Minister of National Development Planning Boediono, commenting on newspaper reports, said the bank had not lodged an official complaint about the government's system in aiding those affected badly by the economic turmoil.

"I don't see the comments as a threat... there has not been anything official," Boediono, who is also the chairman of the National Development Planning Board (Bappenas), was quoted by Antara as saying.

Kompas quoted an unnamed source close to the bank as saying that it had threatened to halt funds for the program because it was disappointed at the inefficiency of the government-appointed teams distributing the aid to the poor.

The government expected to set aside Rp 20 trillion from the 1999/2000 state budget, up from Rp 17.79 trillion allocated for the current fiscal year ending on March 31.

Some had charged that the aid disbursement had been very slow, prone to collusion and lacking transparency.

Meanwhile, an expert staffer of the development planning board, Mubyarto, acknowledged on Thursday several shortcomings in the current social safety net program.

"The program is inadequate, because it was designed hastily to cope with the crisis," Mubyarto told reporters after addressing a seminar on a people-oriented economy.

The program was designed without considering the diversity of the targeted recipients, he said.

"We cannot draw up a policy behind the desk of the central office and expect to get the same results from all regions and all segments of society out of this one policy," he said.

He also admitted that the government had made mistakes by assigning different ministries to design their own social safety net programs, such as the public works ministry, health ministry, and the manpower ministry.

"That was the beginning of our mistakes. When the program is divided among ministries, the mission is no longer to help the needy," he said.

Too much government intervention had also given outlets to collusion by local administration officials and those involved in the aid distribution process, he said.

"The program is considered a project and people were supposed to accept anything the project leaders do, when the people were the ones with more rights over the aid," he said.

Mubyarto said the government was working to improve the program by loosening control over the aid distribution.

"We will perfect the program so that the money will reach its targets," he said.

Bapennas would design a new integrated concept based on the inputs of related ministries and non-governmental organizations, both of which would help carry out and monitor the program's implementation, he said.

In the revised program, the money and other forms of assistance would be channeled straight to local groups, which would then distribute it to their members, with less intervention from government officials.

At a hearing with members of the House of Representatives, State Minister of Food Affairs and Horticulture A.M Saefuddin also admitted that some of the aid had been siphoned off by local government officials and village bodies appointed to distribute it.

"There is some deviation in the implementation of the social safety net program," he told the House's commission III dealing with food affairs.

In Cirebon, West Java, for example, some of the cheap rice, to be sold at Rp 1,500 (17 US cents) in a special market operation for the poor, was found to be sold in the market at Rp 2,500 per kilogram, he said.

The rice was traded by government officials and members of the government-sponsored Village Resilience Boards (LKMDs) which were given the right to manage the aid, he said.

He said the ministry was also investigating allegations that some local legislators in Cianjur, West Java, sold the rice to rice traders at Rp 1,500 per kilogram to be sold again in the Jakarta markets.

Saefuddin played down the figure of the leaked aid however: "The deviation is maybe around 0.1 percent, the remaining 99 percent of the program actually runs well." (das/gis)