Reconciling critics of the social safety net

Reconciling critics of the social safety net

By Sri Pamoedjo Rahardjo

This is the second of two articles on social safe net.

JAKARTA (JP): Reports on fund leakages, missed targets and
fictitious targets -- usual practices in the past -- have
tarnished and attracted controversy to the social safety net
scheme. Critics of the scheme put the government on the
defensive. The public could not distinguish the government-run
social safety net from similar schemes administered by
nongovernmental organizations.

A minister of one ministry was even bewildered by the issue.
He defended himself by saying he was not aware his agency
received safety net funds. Such an absurd statement would not
have happened had the planners defined what a social safety net
was, and promoted the stop gap measure to all levels of service
providers involved and the community.

While alleged leakage of the allocated social safety funds in
the government budget system is always possible, the issue of
leakage would not arise if government officials restrained
themselves from labeling social safety net labels as budget items
for the poor and village communities. Evidence suggests that the
government's previous programs, such as poverty alleviation,
cooperatives, mother and child health care, small business
credit, women in development and even farmers' credit had been
labeled and administered under the current social safety net
program.

What used to be the government's development approach, was now
classified as a basic safety net program strategy (JPS Inti) and
support safety net program strategy (JPS Penunjang). These
classifications had further confused program managers. They
apparently had to change their work orientations, targeting and
implementation strategies, without fully understanding what the
immediate missions were. The program managers maintained their
familiar ways of fund disbursements, under the usual authorized
funds management. It was difficult for them to adjust from the
institutional change paradigm to the short-term assistance
methodology.

Another confusion in project administration was the legal
ownership of the projects. Projects classified as JPS Inti and
JPS Penunjang are under different ministries. Although the funds
technically are under the coordination of the National
Development Planning Board (Bappenas), the bulk of the funds are
functionally still under the authority of the respective
ministries. Confusion is also to be found in the JPS Inti. Mixing
safety net funds with other activities such as funds for market
operations and labor intensive schemes, among others, only
distorts the approach.

Based on the nature of program intervention and availability
of funds, only a smaller portion of the available funds can be
considered as social safety net funds. The program is called the
Regional Self-help Program to Alleviate the Impact of the
Economic Crisis (PDM-DKE). It comprises a mere Rp 1.7 trillion of
the Rp 17.8 trillion touted as social safety net funds! All these
social safety net schemes and social development and poverty
alleviation plans are now labeled JPS, as if a huge amount of
funds are obtained from the loan.

The project implementation scheme of PDM-DKE is, in practice,
similar to the working scheme of the Sub-district Development
Project. The role of regional consultants as facilitators in
identifying project proposals at the village level is central.
While the role of the nongovernment organization is recognized,
due to their limited number, and their short-term existence, the
scheme allows the participation of the village council in lieu of
the local nongovernmental organizations.

The issue of leakage should take into account whether the
implementation of social development programs has complied with
the social safety net scheme. If they followed the agencies'
requirements, the alleged leakage could have been distorted as if
there was no leakage. Unless the schemes are managed under the
same concepts, comparisons cannot be made. Allegations of
misappropriation of funds for other activities and for wrong
target groups may not have happened had the concept of fund
management for each type of project been widely understood.

Until the government is crystal-clear to the public about
these issues, "leakages" in social safety net schemes will
prevail. The government should explain what the government's
social safety net involves. The program should deal with
strengthening the social capacity of communities, allowing
members of society to help them. The pathetic thing is that the
government adopts a populist approach, by feeding the citizens in
need by loans that will become a burden for generations to come.

In order to avoid confusion in future implementation of the
scheme, social safety net strategies and social development
strategies should be separated, but complementary. The social
safety net should be focused on rescuing and recovering members
of the community in need. As they manage to stand upright,
recover their capacities, and reduce social envy in the
community, the use of social development funds as strategies for
institutional change can subsequently sustain them. Only then can
the communities involved be expected to stand up on their own
feet.

In conclusion, the bickering on the leakage of social safety
net funds can be avoided if both critics and safety net operators
understand the meaning of the scheme. Social safety net actions
aim to help rescue and revitalize members of the community most
severely affected by the 1997 crisis. Social development action
focuses on helping improve the family's welfare through long-term
institutional and structural changes. If a common understanding
is reached, the unproductive bickering can cease.

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