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.