Overall programme performance Major household income support programmes

186 A study conducted by Bazzi, Sumarto and Suryahadi 2010 has examined the impact of the unconditional cash transfer BLT programme on education, health and the students’ working hours. The study found that:1 The BLT funds enabled households to increase their use of outpatient health services, particularly at relatively higher quality private institutions; 2 BLT reduced the number of hours worked per student per day by about 0.2–0.5 hours and the number of days worked per week by 0.05–0.2 days, lesser working hours can be associated with increasing study hours for students; 3 for working age adults, however, receipt of BLT programme assistance appears to precipitate a small decline in the labour supply in the order of one hour per week. Respondents of the qualitative study in North Jakarta and East Sumba also stated that they used the BLT programme funds to meet daily consumption needs; for example, to pay for electricity, school fees and other expenses. They considered the cash from the BLT programme very useful as it could be used to pay for various daily needs. Therefore, they regretted the discontinuation of this programme. The PKH conditional cash transfer programme was partly intended to support the health and education of children. According to the SMERU Research Institute 2010, PKH recipients generally used the funds to meet the health and educational needs of their children, such as buying milk, extra food, shoes, uniforms, school supplies and snacks at school. According to the qualitative study in North Jakarta, the funds from the PKH programme were mainly used to finance children’s school needs as well as milk and food for children under the age of five years and pregnant women. This programme was also associated with a reduction in the school dropout rates at elementary and junior secondary school levels.

6.4 Recommendations

As the number and proportion of children in poor households was disproportionately higher than in wealthier households, efforts to improve the welfare of poor households will significantly improve the welfare of children in these households. The Government of Indonesia has made considerable progress in establishing poverty reduction programmes. Targeted household income support programmes have grown, particularly since the Asian financial crisis in 19971998, both in terms of the scope, budget allocations and coverage of recipients. Of the three clusters of poverty reduction programmes, social assistance programmes received the greatest attention from the government in terms of budget allocation. Most of these programmes are in the form of family or household-based income support, which has directly and indirectly benefited children as household members. In the short term, these social assistance programmes help poor, very poor and near-poor households by, at the very least, supporting minimum levels of daily food consumption. Social assistance programmes are designed to support poor and near-poor households that are vulnerable to external shocks. Studies have proved that the Raskin and BLT programmes benefited the targeted households by offsetting the impact of the rising fuel and rice prices in Indonesia. Considering the long-term impact of the social assistance programmes, some are designed to help the development of human capital by supporting improved health and education for children, such as the PKH programme, which specifically addressed the basic health, nutrition and education needs of the children of very poor families who met the eligibility criteria. Against all the successes, the effectiveness of these programmes in reducing poverty levels in poor households is still unclear, due to the implementation challenges, such as overlapping programmes, mis-targeting of beneficiaries, as well as under-coverage, due to a lack of up- to-date data, poor coordination and problems with distribution mechanisms. There was some criticism that the design of the programmes was not practical given the real conditions in Indonesian society. On the supply side, some improvements needed in government poverty reduction efforts are: •฀ Targeting฀of฀households฀should฀be฀improved฀ and tightened in order to reduce errors and increase the coverage of poor households. 187 This can be achieved through improving data quality and by implementing adequate verification before distribution. •฀ Poverty฀reduction฀efforts฀should฀address฀ multi-dimensional poverty rather than focusing merely on income poverty. •฀ The฀distribution฀process฀should฀be฀ coordinated more efficiently. To this end, the government should minimize the number of intermediary parties involved in the distribution channels; for example, in the case of the Raskin programme. •฀ The฀government฀should฀give฀more฀attention฀ to long-term social protection programmes, and strategies aimed at breaking the intergenerational cycle of poverty. Poverty reduction programmes need to focus on investment in human capital, beginning with direct support for the health, nutrition and education of children in poor households, in combination with economic assistance to these households that will allow them to help themselves out of poverty. •฀ Monitoring฀and฀evaluation฀mechanisms฀must฀ be strengthened to ensure that the maximum benefit goes to the poorest in society. On the demand side, several studies have shown that most of the assistance received by households was used to meet the needs of children, whether directly or indirectly. However, some issues concerning the use of the assistance within the recipient households have also come to light. A lack of knowledge and awareness among parents about the importance of investment in their children’s health and education often caused mismanagement in the allocation of household income and social assistance funding received by the household. Indeed, a lack of awareness might have created a disincentive for parents to invest the money in their children’s future success by paying for school-related expenses, creating instead a dependence on government hand-outs. In this case, training or education about household management is needed to build awareness and accountability among the adults parents about the importance of investment in their children’s future. In terms of programme coverage, there are still many poor households not reached by the poverty reduction programmes because they do not have an identity card or are living in illegal areas andor in remote location. Remote locations also cause the programme’s assistance to be underutilised because of the difficulty in accessing the services that the funding is meant to help pay for i.e., schools and health centres. The high burden of transportation costs are another disincentive for the targeted households when it comes to spending the provided assistance funds. Another crucial issue is that targeted households often fail to receive the government assistance they are entitled to due to limited access to information. More involvement of local leaders is needed to ensure that eligible poor households are informed and included in poverty reduction programmes. 189 CHAPTER 7 Addressing child poverty and disparities

7.1 Introduction

Children represent the future of a country and Indonesia’s future will be determined by the quality of its children. Indonesia’s children are shaped by the hard work and persistence of the Government of Indonesia GoI and also civil society groups as they work to fulfill the rights of all children, regardless of their sex, ethnicity, geographical location, family background or disability. As provided in the Constitution, every child in Indonesia has the right to survive, grow and develop to realize their full potential, as well as to be protected from discrimination and violence. This lays the foundation for the responsibility of the state to eliminate child poverty and disparities, and continuously work to improve the well-being of all Indonesian children. The urgency of improving the well-being of Indonesian children is also linked to the economic, political and demographic stability of the country. Firstly, as Indonesia’s economy progresses and becomes further integrated into the volatile world market, Indonesian children need to be made capable of withstanding the impact and potential shocks of global competition. As shown in Table 7.1, Indonesian children generally lag behind neighbouring countries in terms of school enrolment, under- five mortality rates U5MR, and nutritional status. In the future, they will need to catch up with children from developing countries in other regions, like Brazil. Secondly, as Indonesia has already embarked on a democratic transition and decentralization process, the effectiveness of the state will not only depend on a few elites but also increasingly on a wider resource base of highly-qualified community members. Children across the country need support to develop their intellect, integrity and leadership qualities, such that leaders with strong aptitude will be available to carry on the future political transformation in order to achieve a better functioning state that not only provides equal access to welfare but also respects human rights. Finally, the demographic data show a continuous decline in the proportion of children in the national population over the last three decades, implying that in the short term the dependency ratio will increase as a result of a higher proportion of older and elderly people. Thus, the children of today will most likely shoulder a greater economic burden in the future, and without good education and healthy bodies and minds, they will be highly vulnerable to poverty. Improving the well-being of children should be viewed as a multidimensional task. While adequate household income is a necessary component in supporting the fulfillment of child 190 rights, it is not sufficient on its own, and other deprivations must be addressed. Also, increasing children’s welfare at an aggregate level will not be sufficient without ensuring equal access and opportunity for all children regardless of their location, gender and socio-economic background. It has been widely acknowledged that a country’s capability to develop and reach its full potential cannot be judged only by the quantity of growth but also by the quality of growth. All parts of the community, including all groups of children, should have equal access to participate in and to enjoy the benefits of growth. Consequently, the GoI should ensure that development processes and outcomes will increase the well-being of all children equally. Indeed realizing children’s rights and increasing their welfare without discrimination in a large and diverse country like Indonesia entails many challenges. Essentially, the well-being of children is determined by the collective efforts of parents and extended families, the community, the local, provincial, and national government, as well as the global community. Therefore, household poverty and differences in economic development across communities and regions potentially influence the variation in children’s well-being. In addition to the regional disparity in economic and physical infrastructure developments, the progress in realizing children’s rights is also affected by the Table 7.1: Indicators of economic strength and children’s well-being in Indonesia compared with selected developing countries Country Indonesia Malaysia Vietnam Philippines Thailand China India Brazil Gross national income GNI 3,956.8 1,326.9 2,994.8 4,992.1 8,000.6 7,258.5 3,337.4 10,607.0 Combined gross enrolment rates in school 68.2 71.5 62.3 79.6 78.0 68.7 61.0 87.2 Expected years of schooling of children under 7 12.7 12.5 10.4 11.5 13.5 11.4 10.3 13.8 Under-5 mortality rate 41 6 14 32 14 21 69 22 Under-5 suffering moderate high malnutrition 18 na na 22 7 6 43 2 Child labour 5–14 years 7 na 16 12 8 na 12 4 Source:฀UNDP,฀International฀Human฀Development฀Indicators,฀available฀at:฀http:hdrstats.undp.orgenindicators;฀UNICEF,฀Childinfo,฀ available฀at:฀http:www.childinfo.orgundernutrition_nutritional_status.php new decentralized decision-making process. This involves not only the central and regional government executive institutions but also the political parties sitting in the legislative, as well as the media, various non-government organizations NGOs, and the communities themselves to provide the necessary checks and balances. The volatility of the global economy also affects the domestic economy and indirectly impacts on child well-being. In addition to this, the government’s capacity to fund programmes related to the improvement of child well-being is limited by the fact that a large proportion of the central and local government budgets are allocated to the maintenance of the government administrative apparatus and fuel subsidies. With poverty and children’s welfare at the top of the GoI’s agenda, this analysis of child poverty and disparity seeks to increase awareness about neglected and deprived children and to support strengthened policies and interventions to benefit these children. The intention is to specifically explore the multiple dimensions of poverty and deprivation facing children in Indonesia. The following passages draw major conclusions from the gathered quantitative and qualitative data presented in the preceding chapters and link these conclusions with relevant policies in order to develop practical and effective recommendations for the reduction of child poverty and disparities in Indonesia.