The needy wait for safety net program assistance

The needy wait for safety net program assistance

By Christiani S.A. Tumelap

JAKARTA (JP): The eyes of Husin, a grandfather of six, shone
bright as he talked about his tire repair business, a business he
has been in for the last 20 years.

"It may not be a big business, but it has never failed to help
me keep my status as the family's breadwinner," he said while
fixing a flat bicycle tire in his modest working space, a five-
meter-square makeshift wooden room off Jl. U in Tegal Parang,
Mampang Prapatan district, South Jakarta.

The tire repair business earns him as little as Rp 2,000 a day
to over Rp 15,000 (about US$2) a day. These figures were doubled
and sometimes tripled before the economic crisis hit in mid-1997,
he said.

"Alhamdulillah (thank God) that I got Rp 200,000 from the
social safety net fund to buy some spare parts and also several
things needed by my family," he said.

Husin is one of hundreds of people in Tegal Parang subdistrict
who enjoyed the benefit of the government's social safety net
program, which was launched last year to help the poor and
unemployed cope with the country's worst ever economic crisis.

The Mampang district received a total of Rp 455.78 million in
cheap loans provided by the safety net program and channeled
through the village resilience board (LKMD), a community-based
organization created and managed by local leaders.

Each eligible recipient in the district received between Rp
250,000 and Rp 1 million. They have to repay the interest free
loan within 10 months. The repaid money is then distributed to
other recipients in the district.

Unlike Husin, however, many other poor residents in the
capital have not benefited from the safety net program.

In a 16-square-meter rented room in a slum area in the Menteng
Dalam subdistrict, which is just behind President Habibie's
residential compound in the opulent Patra Kuningan area of South
Jakarta, 40-year-old Suparmi longs for a chance to receive a loan
from the social safety net fund.

"I would really be grateful if I could get some money to use
as capital to support my business of selling nasi rames (rice
accompanied by a mixture of dishes)," she said.

Suparmi earns between Rp 10,000 and Rp 30,000 a day to support
her husband and eight children.

"I wonder why other neighborhoods have enjoyed the safety net
program and we have not. We are actually living very close to the
President here," she said.

Controversies

The implementation of the social safety net program has been
criticized by many for failing to reach its intended targets
because of a lack of comprehensive preparation, detailed
distribution procedures and an adequate assessment system.

Several local non-governmental organizations concluded in a
study that the program did not have transparent procedures, a
clear vision or clearly targeted recipients. According to the
NGOs, this led to the misuse of funds by LKMDs and government
officials and the uneven distribution of funds.

The government allocated Rp 17.9 trillion to finance the
safety net program in the 1998/1999 fiscal year which ended in
March, but a large portion of this money was misused.

The National Development Planning Agency (Bappenas) admitted
recently that some of the funds went to the wrong people. The
agency said assigning different ministries to handle the
distribution of the funds was a mistake because some of the
ministries used the funds to finance their own projects rather
than channeling the money to the needy.

Bappenas also said some of the safety net money was used by
certain political parties to gain votes in the June general
election. Government officials in some areas of East Java,
Central Java, North Sumatra, North Jakarta and West Java told
recipients that the funds were from Golkar Party.

The agency also said that at least Rp 8 trillion of the Rp
17.9 trillion allocated for the safety net program failed to
reach its intended targets; the unemployed and people without
enough food.

The World Bank delayed the March disbursement of a $600
million loan for the safety net program after the government
failed to provide a reliable system to monitor the disbursement
of the funds.

The bank later agreed to distribute the delayed $600 million
loan on May 18, just weeks before the general election.

Analysts said the safety net program was prone to red tape and
corruption due to a lack of coordination and monitoring.

The secretary of the subdistrict office in Beji, Depok, West
Java, Sakriyanto, agreed with the critics, saying even he was
not really involved in the distribution of the funds to residents
in his subdistrict.

"I think government officials, including us in subdistrict
offices, should ideally know about the details of the safety net
program so that we will be able to give proper information to the
public," he said.

An activist of a local NGO, Food for Poor People, Widya
Rachman, said the uneven distribution and misuse of the safety
net funds would not have happened had the government socialized
its program from the beginning.

"Lack of information on the purpose, targets and mechanisms of
the safety net program has been exploited by some people to take
advantage of the program, while people who really need the money
can do nothing about it," he said.

He highlighted his organization's findings on the
implementation of the program in some areas of Greater Jakarta,
pointing out that the funds were distributed through different
methods by different LKMDs.

"Some require the recipients to pay a certain amount of loan
interest, others don't. Not to mention that some recipients got
the funds easier because they knew LKMD officials personally,"
Widya said.

He also questioned the way some of the funds received by a
district were taken by the LKMD or other relevant government
agencies.

A chairman of a LKMD in the Tegal Parang district said his
district received Rp 455,780,000 to be used to finance the
development of infrastructure and small and medium-scale
entrepreneurs.

He said his LKMD was allowed by government regulations to use
5 percent of the funds to pay for overhead.

In addition, the LKMD also gave the head of the community unit
an operational fee of Rp 2.5 million and the facilitator Rp 1.25
million, he said.

"As far as I am concerned, these fees are legal. But I don't
know how other LKMDs do their jobs, really," he said.

He said those who wanted to receive funds from the safety net
program registered with their respective neighborhood leaders,
who advised the LKMD on which were the appropriate recipients.