Minister deplores inefficient use of development funds

JAKARTA (JP): Minister of National Development Planning Ginandjar Kartasasmita deplored yesterday the inefficient use of developmental funds, saying it hampered past poverty alleviation programs.

"We're actually not short of developmental funds. What's happened is that the available funds aren't being utilized the way they should," said Ginandjar, who is also chairman of the National Development Planning Board (Bappenas).

In his opening remarks to a national meeting on the poverty alleviation program yesterday, the minister blamed the lack of congruity and synergy among the agencies involved.

"Low synergy will result in high costs and low results," he said. A stable of mediocre human resources did not help either, he added.

He also identified a lack of vision, low skill, half-hearted commitment, and red tape as some of the obstacles to development projects.

Among the remedies prescribed by the minister is better coordination between government officials at all levels. "Better coordination is needed to avoid confusion and competition between one program and another," he said.

According to Ginandjar programs must also incorporate both "top-down" and "bottom-up" approaches.

He explained that while a "top-down" approach may boost high growth rates, it can also create economic disparity in society at the same time.

"We are feeling this disparity now and, because of that, in future development we must combine the approach with one which invites greater public participation," he said, referring to the importance of a "bottom-up" approach.

Ginandjar said the lessons of the past have been learned. A number of new government programs, such as the assistance program for least-developed villages, are being handled in a manner which reflects the new realization, he said.

Ginandjar also said that the poverty alleviation program, though started only two years ago, has yielded positive results.

Under the scheme, least-developed villages were granted Rp 20 million (US$8,695) a year as capital to launch economic activities which would help boost their welfare.

The program has now reached 44 percent of all villages in Indonesia, Ginandjar said.

"Although there has yet to be an extensive study on this, accounts from various regions and on-site reports indicate a real improvement in poor people's income," he said.

Those officially listed as the poor make-up 14 percent of the total Indonesian population.

Speaking to journalists afterward, Ginandjar refuted suggestions that Indonesia had sacrificed welfare distribution for the sake of high growth rates.

He explained that in theory there was usually a trade-off between the two, but fortunately not in the case of Indonesia.

"If growth is boosted then wealth distribution is sacrificed. If you spend a lot of funds for wealth distribution then growth declines. That's what usually happens."

Ginandjar said that in the case of Indonesia, the campaign to turn an impoverished community into a productive one actually helps to increase productivity.

He warned against reading too deeply into particular economic indicators because many other factors come into play.

Bappenas and the Central Statistics Bureau announced recently that the country's growth indicator for 1995 stood at 8.07 percent. (mds)