Govt to continue controversial social safety net program

JAKARTA (JP): The government announced on Tuesday that it would continue the controversial social safety net program, but stressed that it would renegotiate with the World Bank and other donors to revise the distribution methods and program targets.

Newly installed Coordinating Minister for People's Welfare and Poverty Alleviation Basri Hasanuddin said the government would launch a sustainable poverty eradication program to help at least 38 million people living below the poverty line throughout the country.

Speaking to journalists after attending a Cabinet meeting on people's welfare at Bina Graha presidential office, the minister said the World Bank had expressed interest in resuming its loan disbursement. However, Basri said the World Bank had asked the government to revise the current program with a more sustainable one.

"I just discussed (the issue) with the World Bank yesterday (Monday) and they want the social safety net program to be implemented as part of a more durable poverty elimination program," said Basri, who has taken over the post held briefly by Hamzah Haz.

The International Monetary Fund (IMF) and the World Bank suspended disbursement of their loans following the Bank Bali scandal and alleged fund abuse for money politics.

The postponement will affect the US$600 million in World Bank soft loans to support the social safety net adjustments which had been set in the budget at Rp 6 trillion for the current fiscal year.

The government and the IMF are currently negotiating the conditions of the aid disbursement in the next letter of intent, which is expected to be signed next month.

Basri said former president B.J. Habibie earmarked Rp 5.6 trillion for the poverty alleviation program.

"Rp 119.6 billion fund is allocated for food security, for education Rp 2 trillion, for the health sector Rp 1.7 billion and for labor intensive projects Rp 1.8 trillion," Basri said.

He said the new social safety net program would be on target, because the previous budget was allocated for 79 million poor people.

According to the latest figure from the Central Bureau of Statistics (BPS), the number of people living below the poverty line has decreased to 38 million. (prb)