Structural problems causing poverty remain unaddressed

Structural problems causing poverty remain unaddressed

Fabiola Desy Unidjaja
The Jakarta Post
Jakarta

Siti Solikhatun Nasirun, 22, packs her bag and gets ready to
join a group of Indonesian migrant workers to Singapore.

"If I had a chance of better living conditions in Indonesia, I
would never choose to go and work outside the country," Siti said
at her family's small hut in Cirebon, West Java.

Siti, the only child of a vegetable farmer, said she used to
have a decent standard of living and was able to finish her
studies at elementary school in 1992. However, since then, living
had become more difficult and her family could no longer support
themselves by selling vegetables.

Our lives have become even harder since 1998, when the
economic crisis took its toll, with prices soaring, yet real
wages falling.

So now, understandably, Siti tries to escape her family's
poverty by moving to Singapore to become a maid.

There are millions of people like Siti in Indonesia, who
remain caught in a cycle of poverty.

These people have been living in structural poverty, according
to Gunawan Sumodiningrat, secretary for the National Committee
for Poverty Reduction.

They are the result of structural faults in the country's
economic policy that places more emphasis on growth rather than
on the distribution of wealth and resources.

"Structural causes are the most significant causes of poverty
because, like most developing countries, our development strategy
is not people-centered," Gunawan said recently.

Efforts to reduce or eradicate poverty have actually been in
place since this country achieved independence, but they have
never really touched on structural issues.

Most poverty eradication efforts touch more on programs to
ensure the poor have access to basic needs and basic services.

And those programs have brought about improvements to the
living standards of the poor, but they have not been able to
raise the poor out of poverty.

The most notable achievements were recorded during the 32-year
administration of former president Soeharto.

Soeharto managed to reduce the number of poor people from over
40 percent of the whole population in 1976 to only 15.1 percent
in 1990 and further to 11.3 percent in 1996.

However, this impressive result was swept away by the economic
crisis, which began in the middle of 1997.

Since the crisis, the number of poor people has risen
drastically to 24.2 percent in 1998, although in 2000 the figure
was reduced to 16.1 percent.

According to the government's assessment of Agenda 21 on
sustainable development, the number of poor people living close
to the poverty line is still relatively large, despite the
various poverty eradication programs.

The increasing number of people living just above the poverty
line is not an indicator of freedom from the poverty trap. It may
actually mean that those people just move from destitution to
conditions close to poverty.

This only confirms that the various poverty alleviation
programs have actually failed to address the structural problems
of poverty.

Data from the United Nations economic and social survey of
Asia and the Pacific in 2002 show that the income or consumption
of the poorest 20 percent of the population have remained
virtually unchanged over time in Indonesia.

"This means the reduction in poverty, if any, is largely the
result of income growth and not because of an equal share of
revenue," the report stated.

Therefore, what's important for Indonesia now, in terms of
poverty reduction, are efforts to help the poor gain greater
access to resources, according to Bambang Shergi Laksmono, a
social researcher from the University of Indonesia.

"What the country needs is a proportional allocation of funds
between the large-scale and small-scale businesses to ensure
equal access to economic resources," he said.

He cited the government's decision to take the bulk of debts
owed by tycoons through Indonesia's Bank Restructuring Agency
(IBRA), which should have been followed by a similar approach
with the poor.

"If the government is willing to provide Rp 600 trillion (more
than US$66 billion) to bail out banks, they should also have
given such an amount of money to small businesses," he said.

If the government could not give that amount to small
businesses, he said, at least it could provide guarantees to
banks to give money to small businesses.

Responding to various suggestions, the current government has
launched two major policy measures to reduce the number of poor
people by 2.8 million people every year.

The first involves measures to increase the income of poor
families by providing jobs and economic opportunities through the
mobilization of community funding. Second, are measures to reduce
the spending of poor families by providing assistance in health
care, education, food and infrastructure.

Whether these programs will really help the poor or just be
another program that will increase the dependency of the poor on
aid from central government remains to be seen.

After all, the country must take a structural approach to
uproot the structural problems of poverty.