Page 1


2012 PSF PROGRESS REPORT


Table of Contents Message from the Chair of the Joint Management Committee

1

Executive Summary

2

FOUNDATIONS FOR THE FUTURE

9

PNPM Mandiri: Core programs PNPM Rural PNPM Urban Support for Poor and Disadvantaged Areas (SPADA) Rural Infrastructure Support to PNPM Mandiri (RIS PNPM) Regional Infrastructure for Social and Economic Development (PNPM RISE)

Window One: Support to Special Programs PNPM Generasi PNPM Green Disaster Management Support Additional Financing for Post–Crisis Support

Window Two: Implementation and Coordination Support PNPM Rural Implementation Support PNPM Urban Supervision and Monitoring Field Operations and Governance and Fiduciary Support Technical Assistance to BAPPENAS and the PNPM Steering Committee (Pokja Pengendali) PNPM Communications PSF Secretariat Barefoot Engineers Training 3 Community Facilitators Development Project (CFDP) 3 Pro–Poor Planning, Budgeting and Monitoring Project (P3BM) SIMPADU 2 Creative Communities 2

Window Three: On–Granting to Indonesian Civil Society PNPM Peduli Supporting Disabled People Organizations

Window Four: M&E and Special Studies PSF Monitoring and Evaluation (M&E) and Special Studies Local Governance Capacity Development Project (LGCD) PNPM Mandiri Revolving Loan Funds Capacity Building and Sustainability Project Indonesia Urban Poverty Analysis Technical Assistance for the Ministry of Disadvantaged Areas (KPDT)

15 16 24 30 34 38

43 45 53 59 63

67 69 73 76 80 82 86 90 94 97 101 103

109 110 119

123 125 131 135 139 143

Annex One: Financial Overview

147

AnNex tWO: PSF FINANCIAL STATEMENT AT END 2012

150

ANNEX THREE: SUMMARIES OF MAJOR ANALYTICAL WORKS

156

LIST OF BOXES Kalibentak: A road for the people, a road by the people PNPM Urban, Bengkulu: Garbage recyclists fight for a place in the community Key findings from the final project impact study East Sumba: Changing attitudes to women’s health Tlogoweru: Using Owls to Eliminate Rats Key Findings of the Independent PSF Progress Review A Progressive Pemda uses the P3BM toolkit to improve poverty targeting Mural painting Former Political Prisoners Build a New Life Key Findings and Recommendations from the Urban Poverty Profile and Program Review and the PNPM Urban Process Evaluation

23 29 33 51 58 87 98 106 117 141


vi | 2012 PSF PROGRESS REPORT

ABBREVIATIONS AND ACRONYMS

ADB

Asian Development Bank

APBN

Anggaran Pendapatan dan Belanja Negara (State Budget)

AusAID

Australian Agency for International Development

BaKTI

Bursa Pengetahuan Kawasan Timur Indonesia (Eastern Indonesia Knowledge Exchange)

BAPPENAS

Badan Perencanaan Pembangunan Nasional (National Development Planning Agency)

BKAD

Badan Kerjasama Antar Desa (Inter–village Cooperative Board)

BKM

Badan Keswadayaan Masyarakat (Community Organizations)

BKPG

Bantuan Keuangan Pembangunan Gampong (Fund for Village Welfare Assistance)

BLT

Bantuan Langsung Tunai (Unconditional Cash Transfer)

BNPB

Badan Nasional Penanggulangan Bencana (National Board for Disaster Management)

BPKP

Badan Pengawasan Keuangan dan Pembangunan (Board of Supervisors Finance and Development)

BPS

Badan Pusat Statistik (Statistics Indonesia)

BRR

Badan Rehabilitasi dan Rekonstruksi (Rehabilitation and Reconstruction Agency)

CDD

Community–Driven Development

CIDA

Canadian International Development Agency

CSO

Civil Society Organization

CY

Calendar Year

DIALOG

Delivery Improvements and Local Governance Program

DIPA

Daftar Isian Pelaksanaan Anggaran (Budget–Funded Project Proposal Lists)

EO

Executing Organization

EU

European Union

IDT

Inpres Desa Tertinggal, Instruksi Presiden Desa Tertinggal (Presidential Instruction on Neglected Villages)

Inpres

Instruksi Presiden (Presidential Instruction)

JMC

Joint Management Committee

KDP

Kecamatan Development Project

Kemenko Kesra

Kementerian Koordinator Bidang Kesejahteraan Rakyat (Coordinating Ministry for People’s Welfare)

KPDT

Kementerian Pembangunan Daerah Tertinggal (Ministry of Disadvantaged Areas)

KPI

Key Performance Indicators

KPK

Komisi Pemberantasan Korupsi (Corruption Eradication Commission)

LG

Local Government

LGCD

Local Government Capacity Development

LGSP

Local Government Support Project

LPPM–UNCEN

Lembaga Penelitian dan Pengabdian Masyarakat–Universitas Cendrawasih (Research and Community Dedication Institution–University of Cendrawasih

LSP–FPM

Lembaga Sertifikasi Profesi–Fasilitator Pemberdayaan Masyarakat (Community Facilitators Certification Institute)

M&E

Monitoring and Evaluation

MDTFANS

Multi Donor Trust Fund for Aceh and North Sumatra

MIS

Management Information Systems

MoF

Ministry of Finance (Kementerian Keuangan)

MoHA

Ministry of Home Affairs (Kementerian Dalam Negeri–Depdagri)

MoPW

Ministry of Public Works (Kementerian Pekerjaan Umum)

MoU

Memorandum of Understanding

Musrenbang

Musyawarah Perencanaan Pembangunan (Multi Stakeholder Consultation Forum for Development Planning)


vii

NGO

Non–Governmental Organization

NRM

Natural Resource Management

NTB

Nusa Tenggara Barat ( West Nusa Tenggara)

NTT

Nusa Tenggara Timur (East Nusa Tenggara)

P2SPP

Program Pengembangan Sistem Pembangunan Partisipatif (Local Government Participatory Development Planning Program)

P3BM

Pro–Poor Planning, Budgeting and Monitoring (Perencanaan, Penganggaran Dan Pemantauan Yang Berpihak Pada Masyarakat Miskin)

P3DT ( VIP)

Pembangunan Prasarana Pendukung Desa Tertinggal ( Village Infrastructure Project)

PEKKA

Pemberdayaan Perempuan Kepala Keluarga ( Women Headed Household Empowerment)

PKH

Program Keluarga Harapan (Hope Families Program)

PMD

Pemberdayaan Masyarakat dan Desa (Directorate General of Village Community Empowerment)

PMU

Program Management Unit

PNPM

Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment)

PNPM Generasi

PNPM Generasi Sehat dan Cerdas (PNPM—Healthy and Smart Generation)

Pokja

Kelompok Kerja ( Working Group)

Posyandu

Pos Pelayanan Terpadu (village health post)

PPK (KDP)

Program Pembangunan Kecamatan (Kecamatan Development Program)

PPKP (UPP)

Program Penanggulangan Kemiskinan Perkotaan (Urban Poverty Program)

PSF

PNPM Support Facility

RASKIN

Beras untuk Rakyat Miskin (Rice for Poor Household)

RE

Renewable Energy

Rekompak

Rehabilitasi dan Rekonstruksi Masyarakat dan Permukiman Berbasis Komunitas (Community–Based Settlements Rehabilitation and Reconstruction Project)

RESPEK

Rencana Strategis Pembangunan Kampung (Strategic Plan for Village Development)

RIS

Rural Infrastructure Support to PNPM Mandiri

RISE

Regional Infrastructure for Social and Economic Development

RLF

Revolving Loan Fund

RPJM–Desa

Rencana Pembangunan Jangka Menengah Desa (Mid–Term Village Development Plan)

SIMPADU

Sistem Informasi Manajemen Terpadu (PNPM Integrated Management Information System)

SOP

Standard Operating Procedure

SPADA

Support for Poor and Disadvantaged Areas

Susenas

Survei Sosial Ekonomi Nasional (National Social Economic Survey)

TA

Technical Assistance

TNP2K

Tim Nasional Percepatan Penanggulangan Kemiskinan (National Team for the Acceleration of Poverty Reduction)

TPK

Tim Pengelola Kegiatan ( Village Implementation Team)

TPKK

Tim Pengelola Kegiatan Kampung ( Village Activity Operational Team)

UPK

Unit Pengelola Kegiatan (Activity Management Unit)

UPP

Urban Poverty Program (Program Penanggulangan Kemiskinan Perkotaan)

USAID

United States Agency for International Development


1

Message from the Chair of the Joint Management Committee

Ceppie Kurniadi Sumadilaga

Deputy Minister for Poverty, Employment and SMEs, National Development Planning Agency/BAPPENAS As Deputy Minister for Poverty, Employment and Small and Medium Enterprises (SMEs) in the National Planning Agency and as Chair of the Joint Management Committee (JMC) of the PNPM Support Facility (PSF), I am pleased to present the PSF 2012 Progress Report. In its fifth year, the PSF continued to provide strong support to the Government in its leadership and management of PNPM and to make significant contributions to its development impacts on millions of Indonesians. Indonesia has made great strides in reducing poverty. Since recovering from the Asian Financial Crisis, the country’s national poverty rate has halved from 24 percent in 1999 to 12 percent in 2012. Nevertheless, 29 million Indonesians currently live below the poverty line and a significant portion of the population remains vulnerable to falling into poverty. The Government continues to pursue an aggressive poverty reduction strategy, as highlighted in its National Medium Term Development Plan, which aims to bring poverty down to at least 10 percent by 2014. We are attacking poverty on multiple fronts. We recognize that poverty is not solely about incomes levels, but also about access to education, health and other basic services, vulnerability, and social inclusion. The PNPM Roadmap, which addresses PNPM’s future direction, and the MP3KI, which is being formulated as a broader poverty alleviation framework through 2025, will play large roles in lifting and keeping people out of poverty. The National Program for Community Empowerment (PNPM) has been a pillar of our poverty elimination strategy since 2007. PNPM is a multi–sectoral program that brings together people at the community level to decide on and fund their development priorities. With a proven track record of improving people’s welfare, the program brings communities and individuals together and helps them realize their potential. Active in over 70,000 villages and every sub–district in Indonesia, PNPM is huge by any standard. Its scope—with activities in infrastructure, education, health, environment, and microfinance etcetera—is also very broad–ranging.

Towards the end of 2007, the Government teamed up with international development partners to create the PSF to support the implementation of PNPM. As the program’s scale and scope increased, so too did the PSF’s utility and effectiveness as a coordination mechanism that reduces duplication, supports capacity building, and, most importantly, increases development impact. Millions of men, women and children have directly benefited from improved access to infrastructure, services and employment thanks to special programs funded by the PSF since the facility’s opening in 2008, and more than 45 million people have benefited from the core PNPM programs. While PSF’s model as a development and coordination platform is best practice, it will need to continue to evolve as PNPM and Government’s poverty reduction strategies do. With its level of knowledge and experience, it can also make significant contributions to the formulation of the Government’s upcoming Medium Term Development Plan for 2015–2019. The JMC has endorsed intensifying and accelerating the skills and knowledge transfer from PSF to Government agencies to support the transition of the PSF to a National Trustee by 2018. As Chair of the JMC, I would like to thank fellow PSF partners in the Coordinating Ministry for People’s Welfare and the Ministry of Finance as well as our development partners from Australia, Denmark, the European Commission, the Netherlands, the United Kingdom, the United States, and the World Bank for their significant contributions, all of whom have helped make the PSF a success.

Ceppie Kurniadi Sumadilaga Chair, Joint Management Committee Deputy Minister for National Development Planning/National Development Planning Agency for Poverty, Labor and Small & Medium Enterprises


2 | 2012 PSF PROGRESS REPORT

Executive Summary

Fourteen years after the launch of its predecessor programs, PNPM Mandiri, the Government’s flagship poverty reduction and community empowerment program, has come to a cross–road. At this point, the program needs to evolve into a broader social movement in order to achieve its ultimate goal of entrenching new ways for communities and governments to work together to achieve development objectives. The past year has been a year of intense discussion, as Indonesian policy makers worked with development partners and community representatives to determine both the direction of PNPM and how the lessons learned through the program can inform development initiatives into the future. In 2012, the PNPM Support Facility (PSF) supported this discussion and facilitated the formulation of a Roadmap defining the course of the program to 2014 and beyond. In mid–2012, the National Development Planning Agency (BAPPENAS) conducted a review of the PSF to assess its performance and readiness to support PNPM into the future. The review found that the PSF continues to be a strong platform for the Government to achieve a coordinated approach among development partners and that it provides the Government with the capacity to

scale up PNPM, building capacities in terms of governance, fiduciary systems and processes, analytical work, and the development of innovative pilots. The review, however, also observed that the PSF fulfills a number of functions that might better be conducted by Government entities and that as a result, the Government remains heavily reliant on the PSF for continued good governance and oversight. Reforms are therefore needed to enable the Government to develop the vital capacities required to manage the program. The review proposed two shifts in emphasis. The first involves a cultural shift towards a greater level of ownership and leadership by the Government. The second is for the PSF to support the Government in preparations for the eventual transfer of the trust fund to a national institution. Implementing these shifts has been and will continue to be a major priority in 2013. The share of PSF resources implemented by national institutions has indeed steadily increased over the years, from 49 percent in 2008 to 80 percent today. The PSF will continue on this path and engage in more systematic efforts to build partner capacity. In addition to its role in supporting the Government to determine the future of the PNPM Mandiri program,


3

the PSF also continued to support the Government in its implementation of the program through four funding windows. The Joint Management Committee (JMC) approved almost US$90 million in new allocations and a little over US$59 million was disbursed during the year. The results achieved in 2012, discussed in this report, show that the PSF continues to deliver on its commitments under these four windows: PSF Window One: Direct Budget Support and Co–financing: The PSF facilitates the introduction and testing of new strategies and innovations that deepen and broaden PNPM’s core operational design. Four special programs have received financing under this window: PNPM Generasi, PNPM Green, Post–Crisis Support, and Disaster Management. In 2012, development partners allocated an additional US$66 million to PNPM Generasi, thus realizing their pledge to provide US$105 million in grant financing to support its expansion to 500 sub–districts by 2014. PNPM Generasi’s incentivized block–grant mechanism is widely recognized as global best practice and has been found to be a more effective and efficient means of increasing access to health and education services than other approaches, such as household–based conditional cash transfers. As a result, the approach is now being piloted to improve the delivery

of other services. After four years of implementation, the current phase of PNPM Green is closing. Since its inception, the program has disbursed almost 3,000 block grants that responded to the immediate needs of communities for the provision of productive services and for the protection and rehabilitation of essential ecosystem services. Follow–on activities to be integrated with PNPM Rural are currently being considered. The Post–Crisis and Disaster Management Support projects responded to the need to provide assistance to communities rendered more vulnerable by the global financial crisis or affected by natural disasters. Budget rigidities delayed the disbursement of additional grants and implementation on the ground, but both projects gained momentum in 2012. The Post–Crisis project closed in December 2012 as planned, at which point it had provided support to over 1.8 million beneficiaries. The Disaster Management Support project has been extended to December 2013 to allow the completion of all sub–projects, particularly in Mentawai, where recovery is lagging. In the future, similar emergency funds should learn from these experiences and strengthen interagency coordination mechanisms to fast–track disbursements and deploy additional facilitation assistance to support project implementation on the ground.


4 | 2012 PSF PROGRESS REPORT

PSF Window Two: Coordination and Supervisory Support: PNPM’s core functions and systems will need to be sustained under any vision of more integrated local and community–driven development. In 2012, the PSF launched a number of projects to enhance and certify the professional competencies of facilitators; to fill vacant positions in Papua; and to facilitate a higher level of engagement by communities in development initiatives through the use of cultural methodologies. The state of governance in PNPM is still remarkably strong, but faces problems. To improve governance, the PSF increased its supervisory and fiduciary support to PNPM’s implementing agencies and oversight bodies. PSF field analysts visited almost 500 sub–districts in 2012 alone to provide assistance to 15 PNPM and associated programs, while a team of fiduciary specialists also assisted implementing agencies to assess the robustness of PNPM’s fiduciary controls; to resolve complaints and corruption cases; and to produce in–depth analyses related to the program’s governance framework. A more proactive engagement of local stakeholders in these efforts appears to be paying off, with local governments having undertaken hundreds of corrective actions to address implementation issues. Six thematic reviews on specific aspects of program performance and governance were also completed in 2012 to help the Government identify areas for strengthening and opportunities for pilot development. Such support, however, cannot substitute for Government reforms to ensure that enough civil service personnel is made available for the management of PNPM programs and for the re–engineering of governance systems at a higher level. In 2013, the PSF will put particular emphasis on the provision of assistance to the Directorate General of Village Community Empowerment (PMD) to set up a Joint Secretariat and to develop institutional options under the PNPM Roadmap.

The PSF is also working with the Government on a new communications platform for PNPM, which will use social media to strengthen the ability of communities to ask questions and raise issues for debate, particularly concerning budgets and service delivery, and thus to help close the feedback loop at the national level. PSF Window Three: On–granting to Indonesian Civil Society Organizations: One year into implementation, PNPM Peduli, which channels grants through Indonesian civil society organizations (CSOs) to reach marginalized groups who have received only limited benefits under PNPM core programs, is already showing promising results. Beneficiaries are reporting improvements in their access to education, health and legal services and in their capacities to come together to establish and manage their own small businesses. PNPM Peduli is currently reviewing its strategic approach to develop its next phase, which will start in mid–2013. In this phase, PNPM Peduli will place a stronger focus on rights and justice, shifting from a portfolio of discrete activities to a programmatic approach which should enable the program to effectively address drivers of social exclusion (institutional, policy related and/or behavioral). In 2012, the JMC also approved a new project that specifically targets Disabled Peoples’ Organizations. The project will use an on–granting scheme similar to that of PNPM Peduli, but tailored to the specific needs of people living with disabilities. The project’s operational design is currently being refined through intensive consultations, with the first expected result in 2013 to be a mapping of disabled people organizations in Eastern Indonesia. PSF Window Four: Technical Assistance: The PSF’s analytical work supports the Government’s commitment to poverty alleviation and community empowerment


Executive Summary | 5

by linking operational experience and local–learning with applied research and evaluation to develop a knowledge base of best–practice solutions for effective community–driven development and community–led programs in Indonesia. In 2012, the PSF’s Monitoring and Evaluation team completed all remaining evaluations from the 2009–2011 rounds and conducted the Census of Village Infrastructure. This Census covered nearly all urban and rural villages in Indonesia and showed that the Government still has a long way to go to address the country’s deficits in basic village infrastructure. Summaries of the PSF financed evaluations are included in Annex 3 of this report (all of the major studies and evaluations financed through the PSF are available on the PSF’s website, http://pnpm–support.org/). Studies and implementation reviews have consistently identified Revolving Loan Funds (RLF) as a key area of both risk and opportunity for PNPM. In 2012, the PSF discussed a possible strategy for going forward with PNPM stakeholders, building on the assessments conducted by the RLF capacity–building project in 2011. Additional fiduciary safeguards and accountability mechanisms have already been consolidated into PNPM’s Operations Manual. Over the next two years, the RLF project will function as a laboratory to test good practices to build the capacities of RLFs, which will later be rolled out nationally by the Government. Studies have also emphasized the limits to community empowerment when operating in isolation from the supply side. In Indonesia’s decentralized context, the Roadmap mandates a greater integration of development at local level under the ‘One Village, One Plan, One Budget’ concept. The PSF launched two new projects in 2012 to support this agenda, with these projects involving the training of district governments in pro–poor planning and the preparation of village institutions to manage the decentralization

of funds and programs under the planned new Village Law. The challenge will be to ensure that the various PSF experiments that seek to foster improved responsiveness of Government to community demands, under this and other windows, are properly coordinated to maximize learning. Looking forward to 2013, the PSF’s priority, consistent with the Roadmap, will be to pro–actively support an evolution of PNPM towards a more consolidated platform for local service delivery that addresses Government and community poverty reduction priorities, and helps bridge policy commitments and administrative and institutional realities on the ground. This will include new activities to explore how to foster improved accountability relationships between service providers and communities as essential building blocks for more functional, equitable, better quality service delivery.


6

Sujana Royat

Deputy Minister for Poverty Alleviation and Community Empowerment, Coordinating Ministry for People’s Welfare

The Roadmap talks about transforming PNPM Mandiri from a community empowerment program to a social movement. What do you mean by ‘social movement’? What we are talking about is transforming PNPM so that it is truly owned and operated by the community, not by the Government. To achieve this, it must be deeply embedded in the community. PNPM should not just be a means for the Government to build infrastructure or to provide microfinance loans to develop the country’s economy. Rather, it should become a social movement to build a higher level of awareness among the community regarding the rights and responsibilities of all citizens and of the entities that serve them. Ultimately, it is about enabling citizens to achieve their aspirations and to fulfill their destiny. The way it is constructed now, as a Government program, PNPM is still vulnerable, it can be changed and altered at the whim of the Government in power. We need to institutionalize the program in such a way that power over the program’s resources and assets is integrated through community–level institutions, rather than being managed by the Government. That way, the program itself will become an independent community institution and social movement. Through what mechanisms will this transformation be achieved? One of the mechanisms for achieving this is the integration of the ‘One Village, One Administrative Unity, One Plan’ concept, as the primary focus for all development initiatives. The idea is that the plan formed by local communities regarding initiatives that affect their members guides all higher level initiatives, all initiatives of higher government functions. The role of district, provincial and central government bodies is to support the achievement of the village plan, to enrich it and to enable its realization. The idea is to place the plans made by the community at the center stage, not just for PNPM projects, but for all development initiatives.


7

Why does the PNPM Roadmap place such a high priority on improving the facilitator corps?

Why does the Roadmap talk about the need to strengthen community organizations?

At present, facilitators consider themselves to be employees of a particular project, the PNPM program. Our goal is to ensure the transformation of the facilitator corps so that they become social entrepreneurs, or individuals who can identify and recognize social problems and use entrepreneurial principles to organize, create, and manage a social venture to achieve a desired social change. The facilitators must not see themselves as confined to a particular program, but must be committed to developing the village they serve in general. We are trying to implement measures, such as training and certification programs, that transform the role of facilitators into a recognized profession, so that the facilitators can play an ongoing role as agents of change, both inside and outside the PNPM program.

One of the legacies of the PNPM program has been the creation of strong, community–level, participatory organizations, such as village representative bodies, technical management units, revolving loans funds, and so on. These institutions are led and driven by the community. Their ongoing existence is a pre–requisite for strong civil–society led government. They provide a base by which civil society can increase its awareness to become ready to lead the country, to take over the leadership role from the political elite. But at the moment, these institutions are still tied to the PNPM program. We need to establish a clear legal basis for these institutions. That way, they will achieve independence and autonomy. They won’t be tied to a program and their existence won’t be dependent on the support of a particular political regime. We need to transform them into permanent institutions with deep roots in the community. That way, these institutions will enable all members of the community to realize their dreams.

Why does the Roadmap place such emphasis on strengthening the role of local governments in the implementation of PNPM and other village development and community empowerment programs? In terms of government involvement, the role of local governments should be much stronger than the role of the central government. It is local governments that are responsible for providing local communities with the services that they need and for reducing poverty. They are closer to the communities than central government institutions and should better understand the specific situations of their communities better. But at present, the central government plays the dominant role. The Roadmap strives to make local governments aware of their responsibilities and to enable them to meet them. At present, the level of ownership by local governments over community–driven development initiatives is still less than ideal, although there are some success stories. The Mayor of Palu, for example, has implemented an entirely locally managed and funded development program that is built largely on the principles of the PNPM program. Our goal is to empower local governments throughout Indonesia to do the same thing in their own districts. When they have the capacities and awareness to do this, their willingness to put the community’s aspirations first will also improve.

Is there any particular message you would like to send the readers of the PSF Progress Report? The PSF can play an important role in transforming PNPM into a social movement, but we also need to accelerate the transformation of the PSF into a national trust fund, with a much higher level of participation by Indonesian stakeholders from all sectors, including civil society. Part of this involves building the capacities of Indonesian experts by appointing a larger number of Indonesians to senior positions, rather than relying on international resources. We want to develop the PSF as an example of a national trust fund that can serve as a model for the establishment of other national trust funds that address other issues, so we need people who have the capacities to manage these funds. But ultimately, it should not just be a national trust fund, but a community trust fund, supported by government funding. The idea is to give civil society a higher level of control over resources, as an alternative to government mechanisms. We need to move the PSF closer to the end beneficiaries through greater involvement of civil society and its organizations.


FOUNDATIONS FOR THE FUTURE PNPM Support Facility The Government and development partners set up the PSF to provide high–quality, coordinated technical assistance, policy and planning advice and targeted financial assistance to PNPM Mandiri. With the massive scaling up of the PNPM Mandiri program to achieve nation–wide coverage, which started in 2007, one of the PSF’s primary functions has been to support the institutional and management capacity enhancements of the Directorate General of Village Community Empowerment (PMD) within the Ministry of Home Affairs (MoHA) and the Directorate General of Human Settlements (DGHS) within the Ministry of Public Works (MPW ), the respective executing agencies for PNPM Rural and PNPM Urban. A major role of the PSF is to foster innovation through: a Testing new approaches through special programs that might be too innovative or risky to implement through standard budget allocations; b Providing implementation support to foster a sense of ownership and to help the Government to assess how to address remaining weaknesses in the systems; and c Conducting a robust program of analytical and evaluation work to inform next generation policy and operational issues. The PSF provides a forum to mobilize national and international financial and intellectual resources. At the end of 2012, it had received more than US$ 259 million in donor contributions, from Australia, Denmark, the Netherlands, the United Kingdom, the United States, and the European Union (EU). It also continued its knowledge exchanges with countries in East and South Asia, Africa, and Latin America and the Caribbean. In 2012, the PSF continued to support the Government’s leadership and management of PNPM and to deliver significant development outcomes across its four funding windows. Millions men, women and children have benefited from improved access to infrastructure, services and employment thanks to Government and NGO special programs funded by the PSF since the facility’s opening in 2008. Government and development partners have utilized the PSF to lay the foundation for the next generation of PNPM–based programming. As the program stabilizes within Government, the PSF tests new strategies and

innovations to deepen and broaden PNPM’s core operational design. Two examples are: using incentivized block grants to help poor communities meet health and education millennium develop goal (MDG) targets and on–granting to Indonesian CSOs to reach marginalized groups. The results of these experiments vary widely, from moderately satisfactory to global best practice, but much is being learned from both successes and disappointments. In 2012, the JMC endorsed a mid–term engagement framework for the PSF which supports PNPM Roadmap implementation. Engagements are organized around four pillars/strategic priorities: (a) continued poverty impact; (b) improved accountability; (c) social justice and inclusion; and (d) a supportive enabling environment. In its current form, the PSF works with and through Indonesian institutions, spanning core Government implementing agencies, through civil society organizations, including universities and research institutes, and national think–tanks in order to benefit from and develop partner capacities. Implementation support of the operational portfolio is undertaken jointly with implementing partners, with shared review missions in the field. Evaluation work is undertaken in partnership with local social science research institutions. The share of PSF resources implemented by national institutions has steadily increased over the years, from 49 percent in 2008 to 80 percent today. Moving forward, the PSF will continue on this path and engage in more systematic efforts to build partner capacity.

BAPPENAS/AusAID led PSF review In 2012, BAPPENAS conducted a review to assess the performance of the PSF and its readiness to support PNPM in the future. The review found that the PSF provides a strong platform to enable the Government to achieve a coordinated approach among development partners. It also found that the PSF has facilitated the Government’s development to the capacity to expand and scale up PNPM, building capacities in terms of administrative systems and processes, fiduciary obligations, expenditure and disbursement, budget structures, management information systems, analytical work, and the development of innovative pilots to test new approaches to poverty reduction and community empowerment. At the same time, the review highlighted that the Government remains heavily reliant on the PSF


Figure 1. Areas covered and total number of beneficiaries of special programs funded by the PSF 1,880,002

648,970

5,400,000

Beneficiaries Area/Sub-district

12,641 1,509,169

433

344

393

78 GENERASI

GREEN

POST-CRISIS

155

POST-DISASTER

PEDULI

Figure 2. New strategies and approaches tested under the PSF Geographic Expansion of Generasi & Green Projects

2008

Expansion of Generasi & Green continues

2009

20

10

2

• Piloting of incentivized block grants for education & health starts (Generasi) • Piloting of block grants for environmental conservation starts (Green)

• Launch of new window to reach marginalized groups through CSO on-granting (Peduli) • Additional block grants disbursed for areas affected by 2010 disasters (Disaster project) • Additional block grants for areas affected by global crisis (Post-Crisis project) • Launch of project to strengthen the capacity and sustainability of RLF operations • Significant impact on Generasi’s target outcomes demonstrated

1 01

201

• Asia Knowledge and Innovation Lab • New strategy framework for CSO on-granting under Peduli • On-granting mechanism to DPOs in place • Enhanced Empowerment Experiment • Deployment of lawyers to support communities in dealing with corruption cases (PNPM Justice) • Third iteration of the Local Level Institution Study

2 • Approval of new window to reach persons with disabilities (DPO Project) • New early childhood education component under Generasi • Support to PNPM Roadmap and PODES • Assessment of Peduli’s pilot phase • Piloting of cultural methodologies to improve participation

2013

2014 • Mainstreaming of green component in PNPM Rural • New activities to combat stunting under Generasi

Figure 3. Share of committed funding by executing agency

2008

2009 6%

51%

54%

43%

2010 8%

38%

42%

2011 8%

50%

2012

4% 24%

7% 20%

72%

73%

NGO GOI WB


FOUNDATIONS FOR THE FUTURE | 11

for continued good governance and oversight, and that significant Government reform is still required. The review questioned the extent to which the PSF has developed sustainable capacity within the Government, suggesting that the provision of technical assistants to Government work units merely fills gaps in agencies that have not been sufficiently resourced by the Government. In terms of facilitating government and civil society partnerships, the review found that the PSF is enabling important peer–to–peer capacity development and providing important opportunities for CSOs to offer technical assistance to the Government. The review, however, also notes that the issue of ownership may be hindering the facilitation of stronger partnerships, with Government more on the periphery of these particular projects, rather than integral to them, so civil society organizations are often reliant on the PSF to act as a conduit. In terms of supporting high quality monitoring and evaluation, the review recognized the PSF’s strong role in facilitating robust, useful analytical studies that serve as a basis for policy making and program design. The review notes that there has been a good uptake of these studies, stating that they have informed new initiatives, that they have been the basis for the reform of management information systems, and that they have been used to shape the formulation of the PNPM Roadmap. At the same time, the review also notes that while strengthening the analytical capacity of local research institutes has been a part of this objective, little has been done in a formal or planned way. It also notes that while the PSF effectively facilitates the monitoring and evaluation of PNPM, monitoring and evaluation of the PSF itself is not well advanced, with no formal framework in place for measuring progress towards the achievement of PSF objectives. While recognizing the introduction of work plans and performance indicators for PSF teams as a positive step, it also recommends the development of an overarching monitoring and evaluation plan that charts the PSF’s progress towards the achievement of the four main objectives stated above. The review proposes two shifts in emphasis. The first is for the PSF to support the Government in preparations for the eventual transfer of the trust fund to a national institution. The second is for a cultural shift towards a greater level of ownership and leadership by the Government. The review highlighted that stakeholders want the World Bank to continue to administer the fund for the PSF, but would like to see it more integrated into Government.

Moving forward The Government is now facing critical choices as to where next for a successful central government–sponsored community–driven development initiative operating in a decentralized environment. With PNPM’s original goals of enhanced poverty reduction and social empowerment in mind, the Government has articulated its vision in the PNPM Roadmap, which has two main strategic drivers: 1 Community Empowerment Program Consolidation, which focuses on: a The fundamental role of communities as the main actors of their development efforts; b The principles of participation, transparency, accountability, and gender equity; and c The responsibility of central and local government to support communities with resources, financing and facilitation. 2 Development Planning Integration, which focuses on: a Integration of participatory planning processes into regional development planning mechanisms; b Budget allocation for community empowerment programs by regional governments; and c Strengthening the role of regional governments in community empowerment activities. Beyond the question of where next with regard to PNPM, the Government is also articulating, through the MP3KI Strategy, a broader framework for its poverty alleviation efforts in the period up to 2025. The vision that is articulated in MP3KI is one of a self–sustaining, advanced, just, and prosperous Indonesia. Three strategies will be pursued to achieve the MP3KI vision: (a) social protection in health, employment, and social assistance; (b) provision of basic public services; and (c) sustainable livelihoods. The PSF will play a key role in supporting the implementation of the PNPM Roadmap and MP3KI. At the same time, and consistent with BAPPENAS/AusAID led review, there is a consensus among Government and donor partners that with the successful completion of PNPM’s national scale–up, the Government will be wholly responsible for managing PNPM and related initiatives. This means that PSF must change and become an indigenized Indonesian institution. Moving forward, there will be a strong emphasis on building the capacity of Government to assume management of the PSF multi–stakeholder platform and on strengthening Indonesian institutions, including both implementing agencies and partner organizations, to manage and implement the country’s community empowerment agenda.


12 | 2012 PSF PROGRESS REPORT

Kun Wildan

Director for Community Institutions and Training, the Directorate–General for Empowerment of Rural Communities

By 2014, the PNPM program will have been running for around fifteen years. Our key goal now is to ensure the sustainability of the program beyond that point. To achieve sustainability, comprehensive institutional strengthening is required. All five pillars of the Roadmap have been formulated to ensure the achievement of this goal: integration of development initiatives at the local level; sustainability of facilitation; strengthening of community institutions; strengthening the role of local governments; and strengthening of governance. Our goal is to make the program sustainable, regardless of who is leading the national government or where the funding for the program comes from. We can’t be in a position where if we have a new national government with new policies, we have to start a new national community empowerment program from zero. We have to establish PNPM as a community institution that is beyond political influence. That is what we mean by the transformation of PNPM from a community empowerment program to a social movement. One of the most important means for achieving the sustainability of the program is through the integration of development initiatives at the local level. This is closely linked with the fourth pillar of the Roadmap, which involves local government strengthening. PNPM is primarily a poverty alleviation program. In the context of regional autonomy, the responsibility for all the services that matter most to the elimination of poverty, for the management of schools and health care services, for the development of village level infrastructure, lies with the local government, not with the central government. The institutions and approaches to community empowerment that have been developed through PNPM are an effective means for them to fulfill their responsibilities. Ultimately, local government should bear a higher level of responsibility for the management of the program, including its funding. They should learn from it and integrate its approaches into their own systems. They will do this when they become


FOUNDATIONS FOR THE FUTURE | 13

fully aware that this is the approach that works best and when they have the capabilities to implement it. One of the measures that we have implemented to build the capacities and awareness of local governments is through PNPM Integrasi, a supporting program under PNPM Rural whose goal is to integrate PNPM’s participatory development planning into regular district–level development planning and to align political technocratic planning with participatory planning. The program provides block grants to village–level projects generated through the PNPM Rural and Musrenbang (Multi Stakeholder Consultation Forum for Development Planning) participatory planning process. At present, the management and sources of funding for village–level development initiatives are diverse, with different programs under different government entities, each with their own approaches and priorities. Under the Roadmap, we are prioritizing the principle of ‘One Village, One Plan, One Budget’ to ensure that all the different initiatives are implemented on the basis of participatory planning. The plan developed by each village community should guide and inform all the different development initiatives. This will ensure that the initiatives are coordinated and in line with community aspirations. Another issue that needs to be addressed to ensure the sustainability of community empowerment beyond 2014 is facilitation. Good quality facilitation is the key to achieving community empowerment. At the same time, it is important to build the awareness of the community for the need for facilitation. At the moment, under the PNPM program, facilitators are provided to communities free of charge. Facilitators are something that the central government agencies have decided that communities need. PNPM goes part of the way: it is shaping social change by building the awareness of the value of facilitation. We will have succeeded when all members of communities are aware of the need for facilitators, to the point where the community is prepared to pay for them themselves, when the community employs them because they are aware of the value that they create for the community. In fact, this building of awareness is the greatest achievement of PNPM. Of course, we provide facilitators and funds to local communities, but the idea is to enable them to become aware of what

they can achieve through their own efforts. The funds we provide stimulate that awareness. But we need to develop sustainable community–owned institutions that enable them to act on their own. For this reason, we also need to strengthen the legal basis of many of the institutions that have been developed through PNPM, such as the UPK (sub–district financial management units). At the moment, these institutions are protected because they are part of the program. Without this protection, many of them would not be able to operate. For example, many UPK manage revolving loans funds (RLFs) with a total value in excess of Rp 500 million: according to Indonesian banking law, a body managing sums of that value should have a clear legal structure, as a cooperative or as a rural bank. So, to ensure the sustainability of the program, we need to establish a legal basis for their operation outside the program. The purpose of this should not be to transform the institutions, but to protect the assets of the community so that these assets continue to meet the community’s needs. For example, I don’t agree that we should transform the RLFs into commercial banks or something like that. That would change their function into something other than intended: those assets are meant to facilitate the empowerment of the community. The sole purpose of creating a solid legal basis for the institutions should be to ensure that they continue to serve that purpose. Over the years, we have invested significant resources in establishing the PNPM program. Now, the goal is to ensure that the investment isn’t wasted. The most significant return on that investment has been the change in the mindset of the community. After 30 years or more of relying on government handouts, members of the community are becoming empowered to take control of their own lives and decide their own fate. Our job now is to ensure that they have the resources that they require to continue in this direction.


Members of the community in Kalibentak, Blitar, East Java, working on a road to connect their village to the outside world (See page 23)


PNPM Mandiri: Core programs

Indonesia’s National Program for Community Empowerment (PNPM Mandiri) is the world’s largest community development program. It is the flagship program under Cluster 2 of the Government’s four–cluster poverty reduction strategy1 and addresses poverty by empowering communities by giving them control over decision–making and management of their development needs through direct financial and technical support to improve basic infrastructure and access to services. In 2007, the Government demonstrated its commitment to community–led development and to mitigating the potential effects of the global financial crisis by launching PNPM Rural by scaling up the Kecamatan Development Project (KDP). Less than a year later, it reiterated this commitment by scaling up the Urban Poverty Project (UPP) to become PNPM Urban. Together with three smaller but aligned community–driven development (CDD) programs,2 PNPM Mandiri covers all rural villages and urban wards in Indonesia.

1 Cluster 1 focuses on social protection through targeted poverty and social protection programs at the household level; Cluster 2 promotes community level development and empowerment; Cluster 3 supports small and medium enterprises, and micro–finance. The recently added Cluster 4 supports the provision of inexpensive housing, public transportation, clean water and electricity. 2 Three other core programs other than PNPM Rural and Urban are: Support for Poor and Disadvantaged Areas (SPADA); Rural Infrastructure Support to PNPM Mandiri (RIS–PNPM); and Regional Infrastructure for Social and Economic Development Project (RISE).

PNPM Mandiri disburses more than US$2 billion annually to fund sub–projects and activities chosen by communities to improve their lives. Evaluations show that through PNPM Mandiri programs, members of the community eat more, go to school longer, find jobs and establish businesses, have access to health care and participate in community and local political forums. PNPM Mandiri supports development plans made and approved by communities. By focusing primarily on the process by which local development projects are planned and managed rather than on what gets built, PNPM Mandiri marks a sharp departure from the traditional ways in which large development projects are conceived and carried out.


16 | 2012 PSF PROGRESS REPORT

PNPM Rural Summary Information Status

Active

Task Team Leaders

Susanne Holste (sholste@worldbank.org) Sentot S. Satria (ssatria@worldbank.org)

Executing Agency

Directorate of Community Institution and Training, Directorate General of Community and Village Empowerment, Ministry of Home Affairs (MoHA)

Start Date to Closing Date

20 May 2008 to 31 December 2015

Geographic Coverage

2012: 63,163 villages/5,100 sub– districts/393 districts

Project Rationale and Overview PNPM Rural is the largest single component of PNPM Mandiri. PNPM Rural empowers rural communities by giving them control over the prioritization and management of their development needs through the provision of direct financial and technical support to improve basic infrastructure and access to services. The program provides block grants directly and transparently to communities to finance an open menu of poverty

alleviation activities identified through a gender–inclusive community participatory planning process and by enhancing the capacity of the national and local governments to partner with community organizations to improve the delivery of basic services. PNPM Rural benefits approximately 45 million Indonesians in more than 63,000 villages. At least half of the beneficiaries are women. The annually disbursed block grants range in size from Rp 600 million to Rp 3 billion (approximately US$67,000 to US$330,000) per sub–district, with the size of the allocation depending on the sub–district’s population, level of poverty, and degree of accessibility. Block grants are used to finance sub–projects for the construction of socio–economic infrastructure identified through community development planning; revolving loan funds (RLF) for women groups; community training; and community–level responses to disaster and emergencies. With an annual budget exceeding Rp 10 trillion (approximately US$1.05 billion), the program serves as an important mechanism to articulate and support key policy issues for the future. Such key issues include the integration of community–based programs within Cluster 2 and strengthening the formal and informal arrangements between PNPM and sector service delivery at the local level.

Figure 4. Achievements under PNPM Rural of roads built 122,268 km

built or rehabilitated 1,020,153 Infrastructures

45 Million of beneficiaries


PNPM Mandiri: Core programs | 17

Figure 5. Number of sub–districts and villages covered since 2008

4,371

57,266

4,791

61,000

5,100

5,020

63,000

63,163

2,447 34,405

2008

2009

2010

2011

2012 number of sub-districts number of villages

PNPM Rural’s key asset is its network of more than 12,000 facilitators. The facilitators have key characteristics and roles including: (a) serving as community representatives actively involved in the development process; (b) assisting members of local communities with prioritizing their development needs; (c) handling procurement and financial management duties to ensure a high level of accountability; and (d) guiding communities through the technical implementation of their sub–projects. Dialogue on these policy issues continues to be enriched through PNPM’s special programs and pilots. These include PNPM Generasi, which focuses on improving health and educational outcomes, and PNPM Green, which focuses on natural resource management and the development of village–level renewable energy systems. Several quantitative assessments of PNPM Rural have confirmed that: (a) the program has a disproportionately positive impact on the poorest members of rural communities, with the two lowest quintiles of the participating population receiving the largest share of project benefits; (b) the program generates significant benefits in increased consumption, with household expenditures among the poor increasing by an average of 11 percent as a result of project investments; (c) benefits are sustained, with 85 percent of infrastructure built through PNPM/KDP

in good to very good condition five years after its completion; (d) benefits are shared, with PNPM Rural generating more than 20 million days of paid employment and with PNPM’s focus on financing public projects ensuring that they benefit a broad swath of society, particularly poor people; and (e) investments are cost efficient, with infrastructure built through the program 30–50 percent cheaper than similar infrastructure built through existing, traditional Government systems. in the period from 2008 to 2011, PNPM Rural went through a massive scale–up to reach national scale. In 2011 alone, more than 75,000 sub–projects were implemented in 4,168 sub–districts, compared to 23,600 sub–projects in 2,600 sub–districts in 2008. The total value of financial transfers to communities more than doubled in the scale–up period to reach approximately US$1.7 billion dollars by 2011. The rapid expansion of the core PNPM Rural program, together with the establishment of special pilot programs, has created immense managerial and operational challenges. Consequently, the implementing agency, the Directorate General of Village and Community Empowerment (PMD) within the Ministry of Home Affairs (MOHA), has struggled to adjust its staffing structure, management systems and practices to meet the scaled–up needs of PNPM Rural.


18 | 2012 PSF PROGRESS REPORT

In response to these challenges, the Government and development partners have agreed to focus on five key priorities for improvements, namely: (a) strengthening PMD’s ability to appropriately manage the program; (b) redesigning the Management Information System (MIS); (c) improving the Complaints Handling System (CHS); (d) reinforcing formal and informal fiduciary controls; and (e) improving the quality of facilitators and filling vacancies.

While the state of local governance in PNPM Rural is still strong, it faces challenges. A Local Level Governance Review concluded that PNPM’s solid progress in sub–districts could be undermined by changes in the program design and by problems with implementation and management. These challenges are not new, but the review re–emphasizes the importance of addressing them to avoid undoing years of good work at the community level.

Progress in 2012

The Government and development partners have worked closely to prepare for the implementation of PNPM Rural in 2012–2015. A collaborative stock take of lessons learned from previous phases and of findings of studies and implementation reviews facilitated the incorporation of a number of important design improvements. The new phase of the program places increased emphasis on community empowerment through the deployment of better trained and managed facilitators. As part of this approach, the new phase also broadens the scope of capacity support beyond facilitators to include village institutions and community cadres.

In 2012, PNPM Rural continued to produce strong results. A technical evaluation of the quality of sub–projects and an analysis of their rates of return, both completed by the PSF in 2012, confirmed the quality of village infrastructure financed by PNPM. These infrastructure projects were 25–30 percent cheaper than those built by standard Government contractors and had median returns of 30–50 percent (similar to those measured in 2005). Since its inception, PNPM Rural has helped address Indonesia’s deficit in small–scale village infrastructure, although large gaps remain in the Papua region, the Maluku islands, Nusa Tenggara Timur, and the interior of Kalimantan ( Village Infrastructure Census, 2012). In addition to infrastructure, it also finances other community priorities, such as revolving loan funds for women’s groups (See Table 1).

PNPM Rural 2012–2015 also recognizes economic empowerment as a priority for communities and the Government. Accordingly, a rural economic empowerment program is being developed and implemented as an integral part of PNPM Rural. At the same time, the fiduciary controls and accountability

Table 1: KDP/PNPM Rural Outputs (1998—2012) KDP (1998–2007)

PNPM Rural (2008–2011)

PNPM Rural ongoing 2012

40,371

67,897

14,000

9,049

5,993

1,219

# irrigation systems built

11,062

14,933

4,194

# clean water systems built

10,451

8,772

1,054

4,822

4,024

543

842

1,940

188

# market units built or rehabilitated

1,164

1,101

174

# school buildings built or rehabilitated

6,732

26,642

4,136

Type of sub–project km of farm/rural roads built # bridges built

# public toilets and washing facilities built # village electricity units built

# education activities supported

5,041

10,477

2,190

118,796

175,398

33,892

# health facilities built or rehabilitated

3,865

6,435

1,454

# health activities supported

1,037

6,034

1,054

# other infrastructures built

23,162

20,389

5,155

# revolving loan fund activities supported

68,737

104,144

23,767

# scholarship beneficiaries


PNPM Mandiri: Core programs | 19

mechanisms for RLFs will continue to be strengthened. The PSF–financed RLF pilot project is functioning as a laboratory to test good practices (See PNPM RLF report). Further, the next stage of PNPM Rural will explore how Information Communication Technology (ICT ) can be used more effectively to provide information, to support the sharing of experiences, and to promote transparency and accountability within PNPM communities. Social media, such as Facebook and Twitter, SMS, multimedia messaging and geo–mapping, will be used. Eventually, these technologies will coalesce into a coherent communications platform for PNPM, which will strengthen the ability of communities to ask questions and to raise issues for debate, particularly concerning budgets and service delivery, and thus help close the feedback loop at the national level (See PNPM Communications report).

accountability for a range of services to communities. Such improved accountability can also help with broader PNPM objectives, particularly tackling causes of poverty. Examples of common agents of poverty across Indonesia include limited access to quality health and education services, embedded patterns of marginalization and exclusion, environmental degradation, and shocks affecting communities and vulnerable households. To address these issues, PNPM plans to invest more in effectively training and empowering communities, broadening the program’s reach to include village institutions and community cadres. PNPM Generasi will scale up and explore how community empowerment can contribute to improvements in front–line service delivery in health and education. An enhanced empowerment experiment will test the impact of increased facilitation on various areas of community participation, including the level of participation of groups with a history of social marginalization.

Future Plans Going forward, implementation of the Roadmap, which charts the program’s future course and guides its integration with local governments, will be key. PNPM 2012–2015 will support a higher level of integration of development initiatives at the local level under the ‘One Village, One Plan, One Budget’ concept. It will also mainstream PNPM goals of good governance and accountability into local government practices. Analytical studies and large–scale operational pilots currently being implemented through the PSF will also help with the ongoing development of PNPM in the post–2014 period. These will be further developed under the current PNPM program, with rollouts starting in 2014. Specific initiatives include the following: Improving the social safety net: Since 2011, PNPM and the PSF have been working with the Government’s Anti–Poverty Commission and the World Bank’s poverty team to improve the targeting of Government programs for social assistance. The key action to date has been the unification of targeting systems. Use of the integrated poverty database will be mandatory for all Government agencies starting in 2013. The major risk, however, of an integrated targeting database is the potential exclusion of unregistered vulnerable families. Ongoing collaborative work is testing new ways to use community facilitators and community–based identification to verify the database, providing poor households who are not registered with a way to seek redress. PNPM as a platform for service delivery: The Roadmap outlines how PNPM could serve as a platform for

Livelihoods: PNPM has financed promising initiatives proposed by communities to foster local economic development. Looking ahead, there is an opportunity to deepen support for rural livelihoods with the aim of making local economic development more inclusive. This will be supported through: (a) adopting a value–chain approach to better organize producers and production and to facilitate increased market access; (b) establishing partnership forums that bring together a range of stakeholders across a value chain to generate mutually beneficial outcomes; and (c) extending the reach of the RLF’s to facilitate a higher level of investment in productive assets for rural producer organizations.

Lessons learned Communication platforms and tools: To promote transparency, accountability and stronger management, members of communities need to be able to express their opinions and access information related to PNPM and to other development initiatives. So far, PNPM has used various tools such as accountability meetings and information boards for this purpose. Going forward, the program will encourage members of communities to acquire new skills and to use new technologies, including mobile and internet technologies, to better manage and monitor PNPM. The importance of strong facilitation: The role of facilitators is vital to the success of the PNPM program. Despite the importance of facilitators, evaluations show that their quality and performance is coming


20 | 2012 PSF PROGRESS REPORT

Poor farmers are now able to cultivate on rented lands with help from BKM Ikhlas and PNPM Rural, Pekalongan, Central Java


PNPM Mandiri: Core programs | 21


22 | 2012 PSF PROGRESS REPORT

under pressure as a result of heavy workloads, difficulties with deploying and recruiting facilitators, and unrealistic reporting requirements. During the past year, to address these issues, facilitators in remote areas, such as Papua, have been provided with additional incentives and benefits to make such postings more attractive, and a professional certification institute for community facilitators has been established to improve professional standards. A robust governance framework is critical to program success: Evaluations show that while governance in PNPM is still strong, there are some areas of concern,

including the quality of facilitation and levels of participation. To address this, efforts will be made to increase the qualifications of facilitators (through training and certification) and creative ways (theater performance, music, etc.) used to reach the entire village population. Care also needs to be taken that corruption in the program is minimized and that, if corruption occurs, there is effective follow up and sanctions. One measure being considered is the provision of legal support to communities and lawyers at PMD and of better qualified financial management staff.

Villagers in Kalibentak, Blitar, are now better connected to the outside world, enabling them to access schools, markets, hospitals and other basic facilities.


Kalibentak: A road for the people, a road by the people The village of Kalibentak is located in a steep, hilly location in the mountainous district of Blitar. It is a dry, infertile region where more than 90 percent of the population are small–hold farmers or agricultural laborers. Prior to the entrance of the PNPM program in the village, the village was joined to the road system by a steep, uncertain footpath more than a kilometer long, which was often badly damaged following the rainy season. There was no access for motorized vehicles. The limited access to the road system had a number of negative consequences for the members of the community. It was difficult for children to attend schools outside the village, those requiring medical assistance had to be carried out by piggy–back or on makeshift stretchers, and farmers received lower prices for their crops because of the additional transportation costs involved in getting them to markets. The biggest benefit of the PNPM program in Kalibentak was not the funds it provided to build the road. In fact, the PNPM program has provided less than half of the funds that were required, with the rest coming from contributions from the villagers themselves. The biggest benefit was that the PNPM program established a forum through which the villagers could establish common goals and work together to achieve them. In order to win the funds, the villagers had to come together to learn how to work in a group, to negotiate priorities, and to prepare proposals and plans. In 2003, the villagers prepared a proposal to fund the construction of a road paved with cement blocks under KDP. While the proposal won support at the district level, the funds provided were only sufficient to build a small portion of the road. Under the program, funds were provided both for the purchase of materials and to pay the villagers for the labor that they provided to construct the road. However, given the fact that the funds weren’t sufficient for the construction of the entire road, the villagers decided collectively to donate their labor and to use the funds set aside for that purpose to purchase additional materials and tools, including sand and a cement mixer. Because funding under the PNPM program is usually rotated between competing villages, Kalibentak did not receive additional funding in the following year, despite the fact that the road was still not complete. Because the villagers had become accustomed to working together cooperatively under the program and because they had already seen with their own eyes the benefits that the program could provide, they were highly motivated to develop their own solutions to ensure the completion of the road. Meeting together in the forums that they had established to make their initial proposals, they agreed to impose a charge for the use of the road on all members of

Sulastri, the PNPM social facilitator in Kalibentak. the community. Revenues derived from this means could be utilized for the purchase of additional materials to maintain, improve and extend the road. While everyone agreed that they were willing to pay fees for this purpose, there was some disagreement as to how much these fees should be. Some members of the community, particularly those with larger land holdings, were in favor of higher fees to facilitate the more rapid completion of the road. However, poorer members of the community doubted that they would be able to afford the fees at that level. A range of compromise solutions were proposed, with different fees for motor–bikes and for four–wheeled vehicles, and higher fees for the transportation of crops and commodities produced by relatively well off farmers. Through a process of consensus, a schedule of fees was thereby agreed upon, with motorbike users paying Rp 3000 each time they use the road, while those with four–wheeled vehicles pay Rp 6000. Entirely on the basis of the user fees and without additional funding under the PNPM program, the villagers have since been able to extend the road by approximately 100 to 200 meters each year. The road now provides reliable, all weather access for motorized vehicles, connecting the village to the district road system. With the benefits of the road now clearly established, users are happy to continue to pay the fees for the ongoing improvement of the road system. While additional funding under PNPM in the future would be extremely welcome, the villagers have proved that they can develop and maintain the road largely on the basis of their own resources.


24 | 2012 PSF PROGRESS REPORT

PNPM Urban

Project Rationale and Overview

PNPM Urban builds primarily on the Urban Poverty Program (UPP) series that began in 1999 as a response by the Government to the economic collapse that followed the Asian financial crisis of 1997/1998. The program was conceived as an effective means of rapidly transferring resources directly to the poor in urban communities. The driving force for the Government’s move to scale up UPP to PNPM Urban in 2008 was the desire to institutionalize the proven track record in bottom–up, participatory planning into a single community–driven poverty reduction program and to expand it to achieve nation–wide coverage. In urban areas, coverage now extends to 11,000 urban wards, involving 22.3 million beneficiaries. Total funding for the PNPM Urban program up to 2012 is approximately US$1 billion. A number of special programs are or have been implemented under PNPM Urban, including the following:

PNPM Urban works to ensure that the urban poor benefit from improved socio–economic and local governance conditions by: (a) forming and institutionalizing elected representative organizations that are accountable to communities; (b) providing grants to communities directly and transparently to finance poverty alleviation activities, especially infrastructure services; (c) enhancing the capacity of central and local governments to partner with community organizations in service provision; and (d) increasing awareness of disaster risk mitigation and mainstreaming of measures for resilience.

Poverty Alleviation Partnership Program (PAPG): The PAPG encourages partnerships between local governments and communities to institutionalize a consultative process between the two for future activities undertaken by local governments using their own funds. The program allows local governments to access matching grants for city–level poverty reduction activities and finances poverty alleviation sub–projects that are too big to be financed by sub–district grants or that require higher–level local government involvement,

Summary Information Status

Active

Task Team Leader

George Soraya (gsoraya@ worldbank.org)

Executing Agency

Directorate General of Human Settlements (DGHS), Ministry of Public Works

Start Date to Closing Date

20 May 2008 to 31 December 2015

Geographic Coverage

National 10,924 urban wards in 268 cities/districts (2012)

Figure 6. Number of urban wards covered since 2008

2008

8,813

2009

11,014

2010

10,948

2011

10,948

2012

10,948


PNPM Mandiri: Core programs | 25

such as networked infrastructure development and/or maintenance, and that cover more than one ward. PAPG covers 118 cities. Neighborhood Development (ND): ND improves living conditions for the poor by promoting urban upgrading. This specialized program uses an approach which is programmatic (three year plan), integrative (a package of investments, such as housing, drainage, roads), and spatial (using evidence based on urban planning expertise). The program significantly increased the size of ward grants, to up to US$111,000 per ward, for neighborhood–level interventions that target the poorest areas. ND grants are matched by at least the same amount of funds from the participating local governments. Approximately 19 evaluations, studies, and reviews of the UPP/PNPM Urban program have been carried out since 2001. On the basis of these studies, significant

improvements to the project design and quality of implementation have been made over the period that the program has been implemented. These improvements include requirements for local government counterpart funding; the deployment of special facilitators for infrastructure projects; changes in the composition of facilitator teams; strengthening of the Complaints Handling System (CHS); and the use of a web–based Management Information System (MIS). In 2011, a comprehensive process evaluation was conducted that went into some depth on a number of key issues related to project design and implementation, including: (a) how the CDD approach has evolved and how it is addressing the needs of the urban poor; (b) the PNPM Urban Program in the context of other urban poverty programs in Indonesia; (c) institutional issues; d) the role of local government; e) approaches to capacity building; (f ) the quality of infrastructure; and other relevant issues that would provide input to future

This bridge was built through the PNPM Urban program in Makasar, South Sulawesi. The PNPM program has facilitated the building of more than 11,000 bridges throughout Indonesia.


26 | 2012 PSF PROGRESS REPORT

project design. The study also reviewed the strengths and weaknesses of the program, documented good practice, and distilled lessons learned. Some its key findings have already been incorporated into the design of PNPM Urban 4 (see lessons learned).

Progress in 2012 In 2012, PNPM Urban continued to make good progress towards its development objective. Grants have been used to finance infrastructure (79 percent); social activities (12 percent); and revolving loan funds (9 percent). Participation of the poorest community members and of women improved. These improvements are the result of increasingly proactive measures to include all community members. While there have been some improvements in terms of women’s participation rates

in the community planning process, the quality of this participation needs to be strengthened. A number of concrete actions have been planned, such as: (a) a quota of 30 percent of women facilitators; (b) maternity leave for women facilitators; (c) inclusion of gender data in the Management Information System (MIS); (d) focus group discussions for women in project cycle activities at the community level; (e) ongoing support to women as members of RLF groups; and (f ) training on gender awareness. PAPG was completed. The number of local governments participating in the program well exceeded the project targets, with local government contributions reaching US$61 million, or 43 percent of the total PAPG investment. This sum was 25 percent over target. Most of the program’s performance indicators were achieved.

Figure 7. Achievements under PNPM Urban

164,366 solid waste units and

sanitation facilities built

13,499 health facilities built

of small roads built 34,627 km

22.3 Million of beneficiaries

167,852 houses rehabilitated for the poorest

of drain built 17.964 km


PNPM Mandiri: Core programs | 27

Women carrying their children gather in front of heatlh facility for regular post–natal check ups.

About US$145 million of funds from grants and local government and community contributions financed the development and maintenance of 4,400 km of small roads; 530 km of drainage; and the rehabilitation of 22,700 housing units. The slum upgrading scheme continued to make good progress. In 2012, an additional 62 wards were selected for participation in the scheme, in addition to 273 previously selected wards. By the end of 2012, approximately US$20 million worth of grants had been disbursed; 273 Community Settlement Plans (CSP) had been developed; and 37 km of village roads, 13 km of drainage, 1,800 sanitation facilities had been built or rehabilitated. The quality of higher–level project management continued to be a challenge, however, particularly in terms of delays with the procurement of consultants. By the end of 2012, most of the consultant firms had been awarded for 2012–2015. This should help ensure more adequate supervision of project activities in the field into the future.

The project intensified its capacity building efforts, including through the implementation of a training program for local government officials. The training covered issues related to complaint handling, neighborhood development, and other matters. The training involved officials from 268 cities/districts.

Future Plans The Government has committed to continue PNPM Urban in approximately 11,000 wards in about 1,000 cities/districts in the period from 2013 to 2015. The design of PNPM Urban 2012–2015 builds on its predecessor project, PNPM Urban 3, but with several important modifications based on the ongoing learning (see Lessons Learned). These modifications responded to the dialogue between Government and development partners, recent experiences with the implementation of PNPM Urban 1 and 3, the results of the RAND process evaluation, and the mandatory World Bank Implementation Completion Report for two predecessor projects (UPP 2 and UPP 3). Priorities for the program in 2013 onwards will be to:


28 | 2012 PSF PROGRESS REPORT

Improve project investments and implementation by rebalancing the social and infrastructure portions of the block grants; enhancing women’s participation in the program; reviewing the maintenance arrangements to ensure the sustainability of small–scale investments; and improving facilitator management, hiring, and retention, as well as overall program management. Implement programs targeted to meet the needs of women and the poorest members of the community through specialized neighborhood level interventions in the poorest communities to: (a) stimulate better coordination in community and local government planning; (b) promote more integrated block improvement based on a medium–term vision and spatial planning; and (c) design a more sustainable social program as part of the block grant. In addition, a separate funding window may be allocated on a pilot basis to be managed by women’s groups to increase their level of participation and ownership of the program Improve the MIS to better track results and allow for timely delivery of information by training community members and facilitators in matters related to data entry and reporting and by improving the usability of the MIS website. It will also enhance the government’s capacity to carry out evaluations of the program. Support capacity building efforts for local governments by continuing to implement lessons learned through the ND and PAPG programs. Limit RLFs to those wards which have already benefited and which have demonstrated satisfactory financial performance based on meeting minimum targets in terms of a pre–agreed set of financial indicators.

Lessons learned Importance of proper fiduciary controls and strong governance: Proper fiduciary controls and strong governance structures are essential to improve accountability for funds and to reduce risks and incidences of unaccounted funds, fraud and corruption. At the national level, although there have been significant improvements, risks associated with the invoicing process under consultants’ contracts remain significant. To address this, the Ministry of Public Works (MPW ) has allocated significant resources to implement mitigation measures, including maintaining a very active project website and complaints handling system

Strengthening levels of participation: Overall, community organizations are working well, although levels of participation, particularly by women, are relatively low. This is attributed to many factors: socialization efforts that are not always adequate or effective; challenges in sustaining participation over time due to fatigue; the opportunity costs with regard to time away from work and families; and that some female–headed households feel their voices aren’t heard and thus don’t bother to participate Increased focus on socio–economic services: When community members and key informants are asked about the most important needs of the poor and about what elements of PNPM Urban are most beneficial, many respondents emphasized the need for social and economic services. The majority indicated that the poor most needed loans, training, and health and education services (support with school expenses and skills training). Improving linkages between PNPM Urban and local governments: Most government officials are aware of PNPM Urban activities. In some communities, linkages between the program and local governments are quite strong, while in others there is little coordination. In the more successful communities, the annual local government development planning meeting process, the Musrenbang, is a crucial mechanism for coordination between PNPM Urban and local government. Sub–optimal performance of Revolving Loan Funds (RLF): Many RLFs continue to perform poorly. Going forward, the project will develop a dual strategy for non– or poorly performing RLFs on the one hand, and for well performing RLFs on the other hand.


PNPM Urban, Bengkulu: Garbage recyclists fight for a place in the community In Bengkulu, as everywhere else in Indonesia, people involved in recycling garbage are often considered to be outcastes, the lowest of the low in society. People look at the scavengers’ filthy clothes and see them pawing through piles of garbage and feel nothing but contempt. One of the main reasons garbage recyclists formed KUGERBAS was to overcome this marginalization and restore dignity to people who engage in this kind of work. At first, because of community prejudice and because of the limited availability of funds under the PNPM Urban program, it was very difficult to win support for the group. After we formed the organization, we made a proposal for funding for revolving loans for the members to establish or develop their business activities, but our proposal was not accepted. However, in 2010, we successfully applied for a grant from BAZ (Badan Amil Zakat). The group used these funds to create uniforms for its members and to provide new carts, with registration plates and a license number clearly stenciled upon them. The uniforms and the new carts have been instrumental in changing community attitudes towards the garbage recyclists. Even though the uniforms were nothing elaborate, they reinforced the idea that the recyclists were engaged in constructive, useful and productive activity, and that they belonged to an organized corps. This has helped to enable the recyclists to offer other services, such as shifting goods in their carts. Not only did they change the attitudes of members of the community, they also changed the attitudes of members of the group itself. Members became more aware of their collective interests and more prepared to work together to achieve them. One of the biggest successes of the group has been in lobbying for the provision of identity cards, which enable members to access health and education services. Members with limited education are often intimidated by the bureaucratic procedures involved in applying for a card and lack confidence. The group can assist members by facilitating the sharing of experiences with such procedures. If members run into difficulties, they can ask the group to advocate for their rights. In general, bureaucrats have responded positively to this advocacy. They recognize KUGERBAS as a legitimate means for the recyclists to access services.

Mardan Siregar, BKM Coordinator and Chair of the Bengkulu City Forum

In the year following the establishment of KUGERBAS, building on the improved standing of the recyclists in the community, the group gained access to funding under PNPM Urban, with a number of members participating in savings and loans groups. This has enabled them to expand their business activities, to rent storage space, to employ assistants and to move up the business chain. The goal of the group is to facilitate a change in community perceptions and in the perceptions of the members themselves. Through the activities, public opinion is slowly changing. In the past, recyclists were regarded as little better than thieves and scoundrels. KUGERBAS wants people to recognize recyclists as useful members of the community who make a contribution by assisting in the management of waste.


30 | 2012 PSF PROGRESS REPORT

Support for Poor and Disadvantaged Areas (SPADA) Summary Information Status

Closed in December 2012

Task Team Leader

Natasha Hayward (nhayward@worldbank.org) Hans Antlov (hantlov@worldbank.org)

Executing Agency

Ministry of Disadvantaged Areas

Start Date to Closing Date

SPADA National: 9 June 2005 to 31 December 2012 SPADA Aceh Nias: 22 December 2006 to 31 December 2011

Geographic Coverage

51 districts in 10 provinces

Project Rationale and Overview PNPM–SPADA was launched in 2006 to bring PNPM Rural experiences in participatory development planning and implementation mechanisms from the sub–district to the district level and to build the capacity of local governments to deliver basic services in disadvantaged and post–conflict areas of the country. At that time, Indonesia had embarked on an ambitious decentralization program through the Law on Regional Governance that became effective in 2001, shifting most government functions from the national level to the country’s districts. District heads, formerly appointed by Jakarta, were directly elected, local government spending rose significantly, and development services, such as health and education, were transferred to the districts. While there have been significant gains from decentralization, this remains an incomplete transition, with the capacity of district governments to provide equitable and accessible services and the ability of poor people to engage with processes of local governance still varying considerably across regions. Community–based approaches in disadvantaged and conflict–affected regions have also had to be complemented with measures to support the new role of district governments in arbitrating and deploying authority. The key challenge was that in Indonesia’s poorest districts, many government services either functioned poorly or, in conflict areas, had collapsed. In 2004, the Government created a special State Ministry for Disadvantaged Areas (KPDT ) that produced an action plan to support better governance

and more effective poverty reduction in the 100 poorest districts in Indonesia. The core components of this strategy were investments to build local capacities; to provide basic services to poor communities; to promote growth by removing distortions and by providing public infrastructure; and to support appropriate processes for local–level reconciliation and recovery. This provided the opportunity to design a project that would fund such investments in 32 of Indonesia’s poorest districts, and, with the addition of a project funded by the Multi Donor Trust Fund For Aceh and Nias (MDF), in 19 districts in Aceh and Nias after the 2004 tsunami and 2005 peace accord. PNPM–SPADA was designed to concentrate on the planning process itself, and specifically on three key areas: (a) community–based planning; (b) the improvement of the local investment climate; and (c) better social services, particularly in education and health. SPADA provided block grants for local planning and investment at the district and sub–district levels, with sub–projects determined through participatory planning processes involving communities and multi–stakeholder groups at the district level. The project provided intensive technical assistance and training to local governments and to citizen groups to improve the local government planning process and to increase accountability, transparency and community participation. SPADA operated with an open menu system for the use of the block grants, but at least 30 percent of the district block grants had to fund health and education sub–projects, and at least 5 percent of sub–district grants had to fund projects targeted at meeting the needs of youth. PNPM–SPADA comprised two projects: SPADA National, which covers 186 sub–districts in 32 disadvantaged districts in eight provinces; and SPADA Aceh–Nias, which covers 19 tsunami, earthquake and conflict–affected districts in Aceh and North Sumatra. Both SPADA National and SPADA Aceh–Nias were implemented by the KPDT. The SPADA National project amounted to US$134 million, of which 78 percent was financed through a World Bank loan and credit and 22 percent financed from national and local government resources and community contributions. The SPADA Aceh–Nias project amounted to US$51.6 million, of which 72 percent was donor financed through trust funds and 28 percent financed by the Government. After a slow start in 2006–2007, SPADA significantly increased disbursements and utilization rates in late 2008. The initial difficulties and delays were due to a number


PNPM Mandiri: Core programs | 31

SPADA has financed the building of over 1,200km of rural roads.

of factors: (a) the fact that KPDT was a new ministry and lacked experience with CDD projects; (b) problems with procurement due to inconsistency between World Bank and Government procurement guidelines; (c) late issuance of central government budget that caused poor quality planning; and (d) difficulties with attracting qualified consultants willing to work at government–set salary rates in a setting saturated by international agencies. The main reasons for this turn–around were improved support from the national management consultants; a strengthening of the KPDT management team; and that the capacity development programs facilitated by KPDT and the World Bank Task Team to project stakeholders started to bear fruit. All project activities in SPADA–participating districts were completed in 2011, except for an additional cycle of sub–grants to seven high–performing districts in West Kalimantan and Central Sulawesi until April 2012. During 2011, KPDT intensively provided technical assistance to local project teams and districts to properly conduct project closure activities, particularly to prepare the required documents for project assets hand over, to finalize financial issues and complaints handling, and to improve the quality of data from the field.

Progress in 2012 The planned key activities for SPADA in 2012 included finalization of top–up activities in the selected districts; implementation of the final project output study; finalization of project closing exercises in the field; and preparation of the final project reports in readiness for final project closing of SPADA National. The additional cycle of block grants in seven districts in West Kalimantan and Central Sulawesi was formally completed in April 2012. A joint implementation support mission to the districts showed that while delay in the finalization of sub–projects occurred, the SPADA projects managed to successfully complete all planned activities to reach or exceed the established targets. Under the two projects, more than 10,400 sub–projects were completed utilizing US$99.93 million (91 percent of the total grants allocated), helping local governments in some of Indonesia’s poorest areas to improve local governance, health, education and basic infrastructure such as water supply, sanitation, transport, and drainage. Overall, SPADA Aceh–Nias and SPADA National achieved their development objectives. The projects have successfully strengthened the quality of community


32 | 2012 PSF PROGRESS REPORT

proposals and enhanced the roles of multi–stakeholder groups at the local level. SPADA has also built the capacity of two important public institutions, the Ministry of Disadvantaged Areas (KPDT ) and the Regional Planning Agencies (Bappeda), as well as of local technical agencies (dinas) that have been directly involved in project management. Local governments provided administrative funds to support SPADA, participated in project oversight and monitoring, and assisted in resolving fraud cases. In preparing for project closure, the sustainability and replication of SPADA approaches into local development processes was a priority issue. KPDT has collaborated with local governments to ensure the sustainability of project initiatives and practices. Local governments and all targeted districts have committed to allocate funds for operation and maintenance after project closure. However, KPDT needs to continue to monitor project assets after hand–over and to provide technical assistance to local communities to maintain sub–projects. Maintenance Teams have been established in all districts, with guidelines and training provided by KPDT.

The final project impact study was conducted in October–November 2012 to obtain information on performance in terms of the key performance indicators, including components of infrastructure, health services, education and business development (see box 3).

Future Plans In 2011 and 2012, representatives of the KPDT and the World Bank discussed a potential follow–on project to the nationwide SPADA project on the basis of the experience and lessons learned from the first two projects. A concept note for SPADA 2 was approved in June 2012, although project preparation was ultimately halted in September 2012.3 However, preparation for a project to be implemented in 2015 may be resumed. In the meantime, lessons learned from SPADA are being incorporated into KPDT’s broader portfolio, which focuses on the development of remote and disadvantaged areas.

3 SPADA2 was not included in a revision of the Government’s lending plan for World Bank–funded projects for 2013, and is presently being prepared for 2015.

Basic tertiary infrastructure, such as water supply systems, is usually the highest priority of poor communities.


Key findings from the final project impact study The final project impact study showed that overall, the two SPADA projects have improved access to cost–effective, quality infrastructure. The average economic rate of return for infrastructure sub–projects in both SPADA Aceh–Nias and SPADA National exceeded the target of 20 percent (for Aceh–Nias 34 percent, and for SPADA National 32 percent). The assessment also showed that in terms of technical quality and sustainability, an average of 71 percent of infrastructure sub–projects in the two projects were rated as satisfactory (end target was 70 percent). In the health and education sectors, the study also confirmed the level of satisfaction of beneficiaries with regard to the services provided by the projects, with close to 90 percent of respondents reporting that they were satisfied with the quality of services. The health sub–projects have resulted in considerably increased use of public health services. The number of new patients increased by 1.5 million in SPADA National

areas, or about 41 percent, compared to 2007–2008. In Aceh–Nias, the project made a large contribution to the decrease of children aged 7–12 not attending primary school, and children aged 13–15 not attending junior secondary school. Substantial accomplishments were also reached in the areas of local governance capacity development, conflict resolution, and legal aid assistance. SPADA strengthened district capacity in ten pilot districts in Aceh–Nias, resulting in the improvement of policies and regulations for community participation in planning, decision making, and oversight. In Maluku, SPADA increased the use of alternative dispute resolution and legal mechanism by communities to resolve disputes, while in Aceh more than 2,300 women benefited from legal aid assistance. The success stories and lessons learned from implementation of the top–up activities are being used by KPDT as a basis for the development of similar projects.

Figure 8. Achievements under SPADA

Number of school rehabilitated TARGET

300 schools

ACHIEVEMENT

854 schools

Number of health facilities rehabilitated

COURSE

TARGET

50 facilities

ACHIEVEMENT

397 facilities

Number of health and education trained TARGET

11,500 trainer

ACHIEVEMENT

18,974 trainer

COURSE


34 | 2012 PSF PROGRESS REPORT

Rural Infrastructure Support to PNPM Mandiri (RIS PNPM) Summary Information Status

Active

Task Team Leader

Wolfgang Kubitzki (wkubitzki@adb.org)

Executing Agency

Directorate General of Human Settlements (DGHS), Ministry of Public Works

Start Date to Closing Date

28 January 2009 to 30 June 2015

Geographic Coverage

600 villages in 34 districts in the provinces of Jambi, Lampung, Riau and South Sumatra (PNPM RIS 3)

Project Rationale and Overview Rural Infrastructure Support to PNPM Mandiri (RIS PNPM) was launched in 2008 as a core PNPM Mandiri program to help address Indonesia’s large deficit of village

infrastructure. A sharp decline in public and private spending in infrastructure investments from 6 percent of GDP in 1997 to only 3 percent in 2009 had indeed resulted in alarming infrastructure conditions in many rural villages. In project areas, 50 percent of villages were not connected by asphalt roads; 45.7 percent of rural households did not have access to safe water sources; and only 34 percent of them had access to sanitation facilities. The decision to use PNPM’s community–driven development (CDD) platform to support infrastructure investments under RIS was based on the substantial evidence demonstrating that CDD approaches are more effective than other approaches to achieve basic infrastructure development and more likely to offer better cost recovery and maintenance of completed infrastructure facilities and services because of the strong sense of ownership by the community members. RIS PNPM provides facilitation assistance and block grant financing to community–identified priorities to upgrade basic rural infrastructure in more than 3,800 villages in the four provinces of Jambi, Lampung, Riau, and South Sumatra, in all of which the rate of incidence of poverty is above the national average. In total, more than 3.5 million poor people are expected to benefit from infrastructure improvements in their villages, including from newly

This water storage facility was built through the PNPM program in Saipar Dolok Hole, North Sumatra. It is one of more than 800 such facilities that have been built under the program. At the time this program was established, 45.7 percent of rural households in Indonesia did not have access to safe water sources.


Table 1. Infrastructure built to date under RIS PNPM projects Type of infrastructure

RIS PNPM 1 (closed)

RIS PNPM 2 (active)

RIS PNPM 3 (Active–2012)

1,630 km

2,840 km

517 km

5,483

4,200

1,000

Rural roads Bridges Boat landings

52

Drainage canals

142 km

260 km

100 km

Irrigation canals

26km

12 km

4km

355

440

26

75

1,400

110

Water supply pipelines

50km

30 km

5 km

Communal sanitation facilities

1,820

510

80

Domestic water reservoirs Wells

Figure 9. Achievements under RIS PNPM of rural roads built 4,987 km

10,683 bridges built

821 domestic water

1,585 wells built

reservoirs installed

2,410

Communal sanitations constructed of drainage/irrigation 544 km canals built


Roads that connect rural communities to broader transportation networks play a vital role in improving living conditions, enabling communities to attend schools, receive medical care, and engage in trade (Cipetung, Central Java).


PNPM Mandiri: Core programs | 37

Water dykes enable rice farmers to increase their productivity by controlling the cultivation of crops. Balai Batu Sandaran Village, Sawahlunto, West Sumatra. constructed roads and small bridges, upgraded footpaths and drainages, and improved sanitation and water supply facilities. In line with the overall objective of the PNPM Mandiri program, the development objective of RIS PNPM is to reduce poverty and improve local level governance of poor communities in the project areas. The project is implemented by the Directorate of Settlements Development within the Directorate General of Human Settlements of the Ministry of Public Works and is financed through three loans from the Asian Development Bank (ADB), which amount to a total value of US$172 million. The first RIS project (RIS PNPM 1), which closed in 2011, provided block grants to 1,724 villages and supported all these communities in establishing Community Implementation Organizations (CIOs), Mid–Term Poverty Reduction Plans (MTPRPs) and annual investment plans. The block grants were mostly used to finance the construction or upgrading of transport facilities (e.g., rural roads, bridges). The project has provided two cycles of block grants (with each village block grant worth Rp250 million) to 1,500 villages.

Progress in 2012 In 2012, RIS PNPM provided one cycle of block grants to 600 villages, with each block grant worth Rp 250 million. As of December 2012, about 517 km of rural roads; more

than 1,000 bridges; more than 100 km of drainage canals; more than 4 km of irrigation canals; 26 domestic water reservoirs; 110 shallow and deep wells; 5 km of water supply pipelines; and 80 communal sanitation facilities were constructed, rehabilitated and improved under this cycle. Involving the beneficiaries at all stages of planning and implementation of upgrading activities has helped ensure pro–poor outcomes and sustainability. More emphasis must be placed on the establishment of adequate project monitoring mechanisms, particularly those involving district administrations. Their roles, responsibilities and reporting structures have not yet been clearly specified.

Future Plans The recently completed Village Infrastructure Census shows that the Government still has a long way to go to address Indonesia’s deficit in village infrastructure. In 2013, RIS PNPM will transfer more than US$15 million in block grants to 600 villages to finance the provision of basic rural infrastructure. The Government has requested ADB to prepare a fourth loan to RIS PNPM to a value of approximately US$60 million as part of a broader program of support, the Urban Sanitation and Rural Infrastructure Support to PNPM 2 project, the concept of which is currently being discussed.


38 | 2012 PSF PROGRESS REPORT

Regional Infrastructure for Social and Economic Development (PNPM RISE) Summary Information Status

Active

Task Team Leaders

BAPPENAS: Supranto Nadeak (anto@mci.co.id) MPW: Kim Suk Rae (kim@cmac–rise.com)

Executing Agency

Directorate General of Human Settlements (DGHS), Ministry of Public Works

Start Date to Closing Date

26 July 2007 to 26 July 2014

Geographic Coverage

237 Sub–districts/34 districts int the 9 provinces (North Sumatera, Bengkulu, Jambi, Bagka Belitung, West Nusa Tenggara, West Kalimantan, South Kalimantna, South Sulawesi and West Sulawesi)

Project Rationale and Overview Building on the PNPM Rural platform, the Regional Infrastructure for Social and Economic Development (PNPM RISE) project aims to accelerate social and economic development by improving the poor’s access to basic infrastructure, such as access roads, water supply systems, small irrigation infrastructure, markets and health and education facilities, and by introducing micro–credit services in rural areas. Recognizing the mixed performance of local governments in Indonesia’s highly decentralized context, as well as unresolved issues related to competencies and distribution of resources, the program builds the capacity of district and sub–district administrations to operationalize decentralization and regional autonomy laws and to facilitate the achievement of national and local development priorities. PNPM RISE is implemented by the Directorate General of Human Settlements within the Ministry of Public Works and is financed through a US$252 million loan from the Japan International Cooperation Agency (JICA). In the period from 2008 to 2011, PNPM RISE provided more than Rp 1.262 billion in block grant financing to

Jetty for moring boat in Fulai village, West Gane, South Halmahera, North Maluku.


PNPM Mandiri: Core programs | 39

Table 2. Infrastructures built under PNPM RISE Volume (per TA.) Category/Infrastructure

Unit

2009

2010

2011

2012*

Transportation

Total

Road

Kilometers

Bridge

Meters

Mooring Boat

Unit

Other

Package

1,677

2,039

2,389

1,891

7,996

11,183

5,516

4,150

5,191

26,040

43

83

66

24

216

2,154

1,556

978

1,017

5,705 2,036

Clean Water and Sanitation Clean Water

Unit

617

548

419

452

Clean Water Piping

Kilometers

144

145

105

92

486

Bath wash toilet

Unit

686

229

178

193

1,286

Drainage

Meters

52,116

82,657

124,715

51,328

310,816

310

169

239

151

869

114,621

119,037

151,122

144,562

529,342

Health Community Health Center/Community Health Center Subsidiary/Village Maternity House

Unit

Agricultural Production Enhancement Irrigation Canal

Meters

Water Construction

Unit

Farmer Road

Kilometers

Levee

Meters

367

103

213

67

750

12.15

160.11

267.34

439.60

15,646

7,232

2,664

8,103

33,645

Agricultural Marketing Enhancement Village Market

Unit

165

117

82

34

398

Drying Floor, Warehouse

Unit

83

78

74

235

Education Elementary School/Intermediate School

Unit

Furniture

A set of Package

136

210

86

71

503

2,659

1,595

4,254

65

56

121

Source of data: Laporan Pelaksanaan PNPM–PISEW, KMAP, December 2012 * Temporary Data PISEW Application as of December 2012

2,669 villages for the construction of village infrastructure and for the provision of micro–credit services. These significant investments contributed to a reduction in poverty levels from 14.4 percent in 2008 to 12.31 percent in 2010 in the 34 target districts (BPS data).

Progress in 2012 In 2012 alone, PNPM RISE provided more than Rp 423 billion in block grant financing to 2,416 villages for the construction of transportation infrastructure, water supply and sanitation systems, health and education facilities, agriculture extension services, etc. (See Table 2).

These investments have helped to improve access by members of rural communities to vital social and economic services, which in turn has resulted in improvements to a number of human development indicators. The construction of water supply and sanitation systems and the greater availability and accessibility of health facilities has, for instance, contributed to a reduction in the number of deaths from epidemic diseases such as diarrhea, dengue fever and malaria. in the target areas. The program continues to run into some supply–side constraints, however. The number of health workers in target areas has not increased, for example.


40 | 2012 PSF PROGRESS REPORT

Table 3. Effect Indicators for the Six Categories of Infrastructure under PNPM–RISE NO.

INDICATOR

1. Access to Infrastructure a. Number of villages accessible by (land, water, land and water) b. Number of villages by type of widest road surface (asphalt/concrete, gravel/ macadam, earth, others) c. Number of village with road that can be passed by 4–wheel vehicles year round (dominant) 2. Water Supply System and Sanitation a. Number of villages by main source of drinking water (municipal water supply/ mineral water, electric or hand–powered water pump, well, artesian well, river/lake, rain, others) b. Number of villages where the majority population buys drinking water (Buys, Does not buy) c. Number of villages by type of toilet facility in majority of households (Individual Toilet, Shared Toilet, Public Toilet, and Toilet not available) d. Number of households using electricity and the source (PLN and Non PLN) e. Number of village by type of fuel cooker in majority household (LPG, kerosene, firewood, others: coal, charcoal) 3. Primary Health Facilities a. Number of village with epidemic occurrences in last year (Diarrhea, Dengue fever, Measles, Acute respiratory infection, Malaria, Avian Influenza, Tuberculosis, others) b. Number of deaths from epidemic occurrences in last year (Diarrhea, Dengue fever, Measles, Acute respiratory infection, Malaria, Avian Influenza, Tuberculosis, others) c. Availability of health facilities (hospital, maternity hospital, polyclinic, Community Health Centre, Community Health Sub Centre, House Physician, House Midwife, Village Health Centre, Midwife’s Delivery Clinic, Integrated Health Post, Pharmacies, and herbal store) d. Number of health facilities ( Village Health Centre, Midwife’s Delivery Clinic, Integrated Health Post, Pharmacies, and herbal store) e. Accessibility of health facilities (hospital, maternity hospital, polyclinic, Community Health Centre, Community Health Sub Centre, House Physician, House Midwife, Village Health Centre, Midwife’s Delivery Clinic, Integrated Health Post, Pharmacies, and herbal store) f. Number of medical personnel (Male Doctor, Female Doctor, Dentist, Midwife, Others medical personnel, Traditional Midwife) g. Number of persons having suffered from malnutrition in last 3 years 4. Village Market a. Shopping Centers b. Market with Permanent/Semi Permanent Building c. Number of Markets Without Building d. Number of Minimarkets e. Number of Stores f. Number of Agricultural Tool Stores (owned by village unit cooperatives, owned by non– village unit cooperatives) 5. Number of Primary Education Facilities 6. Area and Small Irrigation Conversion of agricultural field to non agricultural field in last 3 years (housing, industry, stores, offices, others) Source: Data Analysis of Village Potential

Up Down

TARGET

TREND


PNPM Mandiri: Core programs | 41

Infrastructure investments are complemented by a focus on improving the local governance environment. By using PNPM’s community–driven development approach, RISE has helped to strengthen the participatory planning process in the target sub–districts and increased the community’s involvement in the construction, utilization and maintenance of basic village infrastructure. The program has also contributed to improvements in the quality of the planning and evaluation of development projects by district governments, particularly by promoting the use of more accurate information on the development needs of rural communities.

Future Plans This current program is scheduled for completion in 2013. A follow–on program, the Rural Settlement Infrastructure and Kabupaten Strategic Areas Development (RISE 2), is being prepared and will extend RISE activities until the end of 2015. Similar programs in the future should place more of a focus on strengthening value chains for key commodities (such as coffee, corn, rubber, rice and for other agricultural commodities) to spur local economic development.

Table 4. Effect Indicators for Measuring Overall Impact of Project Impact NO.

INDICATOR

1.

Poverty Alleviation Total Population Population under Poverty Line

2.

Sustainable& Equitable Regional Economic Development Transportation Services Local Small Industries and Handicrafts Financial Institutions and Services Commodities as main source of income of rural communities

3.

Community Empowerment & Institutional Strengthening at Kecamatan Level Participatory Planning Process Community Involvement in Construction Community Involvement in Operations and Maintenance Use of Information in Development Planning

4.

Institutional Strengthening at Kabupaten level Planning Process &Evaluation Use of Information in Development Planning

Source: Data Analysis of Susenas and CMAC Survey Up Down

TARGET

TREND


A child being immunized against polio in Yappen, Papua.


Window One Support to Special Programs

One of the key roles of the PSF is to enable the Government to take full advantage of the PNPM platform’s ability to reach every village and to deliver an array of services that improves the lives of Indonesians and ensures the achievement of development outcomes. Since its inception, the PSF has disbursed more than US$130 million in direct budget support to the Government for special programs and pilots.4 The Roadmap process, which has reaffirmed PNPM’s central role in the Government’s poverty reduction program, provides a great opportunity to mainstream lessons from these large–scale experiments to support the evolution of PNPM towards a more consolidated platform for local service delivery. There were four active programs

under this Window in 2012. One of these four programs, Post–Crisis, closed in December, while PNPM Green and Post–Disaster will close in 2013.

4 Total commitments under Window 1 have reached US$222 million.

5 Which complement US$115 million in Government financing.

With commitments reaching in excess of US$105 million5 and with a continuously expanding geographic coverage (now at 344 sub–districts out of the 2014 target of 500), PNPM Generasi is by far the largest PSF program. This program has helped to improve access to health and education services for an estimated 5.4 million beneficiaries in 2012 alone. Generasi rewards poor communities’ performance in providing quality education and health services to women and children through an incentivized block grant mechanism.

Figure10. Funds committed and disbursed under Window 1, 2008–2012 (US$ million)

222.22

156.88 130.26 91.27 44.25 16

16 0 2008

19.39 1.6 2009

2010 Approved Commitments Disbursements

2011

2012


44 | 2012 PSF PROGRESS REPORT

Although the impact evaluation completed in 2011 has not been repeated, Generasi is expected to continue to deliver significant positive impacts in terms of its twelve target health and education indicators in new sub–districts, with the greatest impacts in areas with low baselines. Experience with PNPM Generasi suggests that its incentivized block–grant mechanism is more effective and efficient at increasing access to health and education services than other approaches, such as household–based conditional cash transfers. Thus, the potential exists to utilize similar incentivized block–grant mechanisms to facilitate the delivery of other services. The piloting of an approach to incentivizing the poor’s participation in early childhood education services through Generasi started in 2012. Efforts are also underway to introduce incentives for communities to achieve open defecation free status. The incentivized block grant approach is also highly relevant for PNPM Rural, which may consider introducing performance bonuses on the basis of quality of infrastructure delivered and maintained. The Government recognizes environmental conservation as a central component of Indonesia’s triple track plus one development strategy (pro–growth, pro–job, pro–poor, and pro–environment). The PNPM Green pilot provided an operational vehicle to support this environmental agenda at the community level by providing almost 3,000 block grants (out of a targeted 2,500) since 2008 to communities for natural resource management and conservation sub–projects. Although the pilot phase lacked strategic cohesion, Green has achieved—and in some cases even exceeded—its target indicators. The sub–projects it financed responded to the immediate needs of communities for the provision of productive services (sustainable income generation and supply of renewable energy) as well as the protection and rehabilitation of essential ecosystem services. Green investments have built the kinds of resilience and mitigation assets that contribute to climate change objectives. Operating Green as a stand–alone program and the resulting lack of integration with PNPM Rural and other PNPM programs at the national level has pushed the administrative burden downwards onto sub–national partners and communities, however. Under the Roadmap, there are great opportunities to mainstream positive lessons and operating systems from the Green pilot to improve and extend sustainable environmental outcomes across PNPM Rural. A follow–on activity which would provide specialized environmental facilitation and trial mechanisms for incentivizing the provision of ecosystem services that serve the global public good is currently being considered under the PNPM Rural platform.

The Post–Crisis and Disaster Management Support projects responded to the urgent need to provide assistance to communities rendered more vulnerable by the global financial crisis or affected by the October 2010 natural disasters. Budget rigidities delayed the disbursement of additional grants and implementation on the ground, however. The Post–Crisis project managed to make up for these delays and closed in December 2012, as planned, with over 1.8 million beneficiaries, 1 million work days created and 2,790 sub–projects completed (98 percent of target). The targeting of block–grants was sub–optimal, though, as some of the poorest sub–districts in target provinces did not receive funding. The Disaster project has been extended to December 2013 to allow the completion of all sub–projects, particularly in Mentawai, where recovery is lagging. The cash–for–work programs, which first supported cleanup activities and then infrastructure reconstruction, closed in 2011, having generated more than 800,000 paid work days. By the end of 2012, all but 74 of 3,489 selected sub–projects under PNPM Rural had been completed. All the selected Disaster Risk Reduction activities (38) were also completed under the PNPM Urban component, which closed in December as planned. The complexity of resettlement issues delayed the reconstruction of houses and community infrastructure under Rekompak, but all activities will be completed in 2013. Similar emergency funds in the future should learn from these experiences by strengthening interagency coordination mechanisms to fast–track disbursements and by deploying additional facilitation assistance to support project implementation on the ground. A recently completed gender review confirmed that much remains to be done to improve the quality of women’s participation in PNPM. Measures are being taken to ensure that PSF financed projects and special programs promote gender equality so that women and girls benefit to a higher degree. Examples of such measures include setting quotas for female representation in decision–making forums (usually 50 percent) or recruitments (30 percent for Barefoot Engineers in Papua) and analyzing barriers to women’s empowerment to inform progressive policies. In 2012, 55 percent of the beneficiaries of the PSF’s special programs were women, but the percentage of female beneficiaries varied widely, highlighting the need for further efforts to promote women’s participation in PSF projects and beyond and for strategies to close the gender gap for specific services.


Window One | 45

PNPM Generasi Summary Information Status

Active

Task Team Leader

Robert Wrobel (rwrobel@worldbank.org)

Executing Agencies

Directorate for Empowerment of Community Social and Cultural Institutions, Directorate General for Village Community Empowerment, Ministry of Home Affairs and PSF

Start Date to Closing Date

26 May 2008 to 31 December 2013

Geographic Coverage

3,470 villages in 344 sub– districts across 8 provinces: West Java, East Java, West Nusa Tenggara, East Nusa Tenggara, North Sulawesi, West Sulawesi, Gorontalo, and Maluku. Expanding to 3,583 villages in 369 sub–districts in 2013.

Approved Budget

US$ 110.8 million

Project Rationale and Overview

In education, the rate of enrolment at primary schools among children of the appropriate age is close to 100 percent for both boys and girls from households of all income levels. However, only 55 percent of primary school students in the bottom consumption quintile make the transition to junior secondary school, with less than a quarter of these students subsequently attending senior secondary school. Across Indonesia, it has been estimated that 2.5 million children aged 7–15 do not attend school, with 60 percent of these children living in the six provinces on Java. In addition, there are substantial variations in the patterns of income and non–income poverty throughout Indonesia, with rural areas lagging behind urban areas, and the eastern provinces lagging behind the western provinces, particularly Java and Bali. For example, the poverty rate in Maluku is 27.4 percent, more than double the national average of 13.3 percent. The causes of the persistent service delivery failure in rural Indonesia are multi–dimensional. To address this failure requires a high level of investment to improve the quality of health and education facilities and personnel; to develop better road and transportation infrastructure; to provide demand–side subsidies and incentives to poor households and communities to access basic services; and to facilitate better coordination, monitoring and oversight of poverty reduction programs and of service delivery by local governments and civil society organizations.

Over the past decade, the Indonesian economy has expanded and the poverty rate has declined. Despite these improvements, there have been only modest gains in health and education outcomes among poor households. While the country has made significant progress towards some of its Millennium Development Goal (MDG) targets for 2015, it still lags in a number of areas, particularly maternal mortality, infant mortality, immunization rates and junior and senior high school enrolment rates.

In light of the above, the Government is implementing PNPM Generasi to accelerate Indonesia’s achievement of MDGs in areas in which it is lagging: the achievement of universal basic education; a reduction in child mortality; and an improvement in maternal health.

While the rate of maternal mortality fell from 350 per 100,000 live births in 2000 to 240 in 2008, it was still dramatically higher than the average rate of 89 per 100,000 live births for all developing countries in the East Asia and Pacific (EAP) region. Similarly, while the rate of mortality for children under five fell from 56 per 1000 births in 2000 to 39 in 2009, this is still significantly higher than the average rate of 26 per 1000 births for the EAP region. Rates of infant mortality, immunization, births attended by skilled health staff, and access to improved sanitation facilities also remain behind the EAP developing country average. Across Indonesia, it is estimated that children in 42 percent of rural households are stunted as a result of malnutrition.

Through the existing PNPM Rural platform, PNPM Generasi uses community planning and incentivized sub–district grants to improve health and education outcomes. Communities, with assistance from PNPM facilitators, work with health and education service providers to identify locally appropriate ways to improve access to and increase the rate of utilization of health and education services. Grants to sub–districts are used to address small–scale supply or demand constraints, depending on where the need is the greatest. For five years, Generasi facilitators have facilitated meetings that bring community members and local service providers together to discuss the community’s needs and to plan the use of resources. Generasi operates at the sub–district and village levels


Through PNPM Generasi and other Government initiatives, Indonesia is well on its way towards achieving universal primary education, with 95 percent of children enrolling in primary school (SDN I Toyidito, Pulubala, Gorontalo, North Sulawesi).


48 | 2012 PSF PROGRESS REPORT

Figure 11. Number of sub–districts benefiting from improved access to health and services

2010 2011 2012

through existing user groups and service delivery structures, such as integrated community health posts (Posyandu) and school committees, rather than through the creation of new structures. The Government launched Generasi in 2007 as a large–scale pilot program in 129 poor rural sub–districts in five provinces. By the end of 2012, Generasi was operating in 3,470 villages in 344 sub–districts across eight provinces: West Java, East Java, West Nusa Tenggara, East Nusa Tenggara, North Sulawesi, West Sulawesi, Gorontalo, and Maluku. Plans to expand the program to 500 sub–districts by 2014 are underway. An impact evaluation completed in 2011 showed that Generasi was successful in achieving its target outcomes for immunization coverage, prenatal care visits and assisted deliveries in the period from 2007 to 2010. On average, Generasi had a statistically significant positive impact for all of the twelve defined indicators, with the greatest impacts observed in areas with low baseline health and education indicators.

Progress in 2012 The implementing agency, the Directorate General of Village and Community Empowerment (PMD) within the Ministry of Home Affairs (MOHA), successfully expanded the coverage of Generasi to include 132 new sub–districts. PMD also recruited a significant number of personnel to support the program’s expansion, including: four national management consultants; 69 sub–district facilitators for newly included sub–districts; 85 sub–district facilitators for existing locations; and seven district level facilitators.

212 sub-districts 231 sub-districts 344 sub-districts

As in past years, delays in the Government’s budget process resulted in some delays to project implementation, specifically to its rollout in new sub–districts. It also caused delays to the implementation of a number of technical assistance and capacity building activities. To prevent such delays in the future, the PSF is respecting PMD’s request that PSF funds for new sub–districts are not added after the 2013 implementation period begins. Despite delays, an estimated 5.4 million people benefited from the program in 2012.6 Initial MIS reports show that approximately 443,375 women and children received counseling and support related to nutrition; the number of underweight children was reduced by approximately 44,965 through supplementary feeding interventions; and approximately 55,129 community health volunteers received training and operational support in 2012. Communities spent about twice as much on health as on education. This continues a trend since 2009 and is related to the fact that compared to education, the level of Government resources invested in improving health service delivery and access to health services among the poor is relatively low. As a result, over time, communities have invested an increasingly large share of Generasi resources in activities to improve health outcomes in terms of the defined indicators. Figures 12, 13 and 14 show the trends in the relative proportion of funds invested in health and education initiatives

6 Data from only 59% of villages uploaded to MIS for 2012 calendar year at the date of writing. Anticipated that cumulative target will be met once data is verified and uploaded.


Window One | 49

Figure 12. Percentage of block grant funds spent on health and education activities, 2007–11 65%

54%

57%

Health

56%

53%

46%

44%

47%

Education

41%

2007

2008

2009

35%

2010

2011

Figure 13. Community Health Expenditures in 2012 Infrastructure

Cadre Incentives

9%

7%

12%

Counseling and Training

12% 13% Financial Assistance

to Outreach Services and Examanitations

Figure 14. Community Education Expenditures in 2012 Infrastructure

6%

6%

In January 2012, PMD established a secretariat solely dedicated to the management of Generasi under a different directorate than the one in charge of PNPM Rural.7 This internal reorganization was implemented to ensure that adequate human resources are allocated to Generasi and that the program falls under a directorate whose domain of competence is more directly related. The Generasi Secretariat is now fully staffed and operational, but its establishment as a standalone unit has created a number of challenges for maintaining planning, budgeting, implementation, and oversight systems at the national and sub–national levels. Critical functions such as internal and external audits, complaints handling, and reporting will indeed require a degree of cross–directorate collaboration which has not yet been attained.

47%

Supplementary Feeding

Health Facility Equipment

in the period from 2007 to 2011 and the composition of community expenditures in health and education through Generasi in 2012. While access to educational services remains a challenge for the poorest and disabled members of the community, primary school enrollment tends to be high in participating villages and, indeed, throughout Indonesia.

Financial Incentives for Education Providers

5%

Counseling and Training

49%

School Supplies and Uniforms

Future Plans The Government will continue expanding Generasi, particularly in areas with poor health and education facilities and limited coverage. Generasi is expected to cover 500 sub–districts by the end of 2014 and 800 districts by the end of 2017. In addition to the scale–up, the program’s scope will also expand to further address the myriad of supply–side, demand–side and accountability failures that undermine service delivery in the poorest provinces of Indonesia. The Millennium Challenge Corporation (MCC) and the Government have signed a Compact, which includes a grant of US$90 million to support Generasi and to help meet the increased community demands for high quality nutrition education, parental counseling and sanitation services. The grant will also support the expansion of Generasi into areas with a high prevalence of stunting. The Government is considering whether and how to use Generasi to increase the level of use and access to early childhood education and development (ECED) services.

34%

Financial Assistance for Poor Students

7 The Directorate Pemberdayaan Lembaga Adat dan Sosial Budaya Masyarakat (PMD Sosbud).


50 | 2012 PSF PROGRESS REPORT

PMD, with PSF and World Bank support, is undertaking an intensive series of monitoring activities to understand the changes in local incentives and behaviors that are occurring in pilot locations. The findings from these activities will serve as an input to inform decisions on whether and how to mainstream a specific focus on ECED within the Generasi program.

policy and evolving community needs: Since the original design of Generasi, the Government has increased the service standard for the minimum number of post–natal checks from two to three. Generasi’s post–natal check target indicator has been revised accordingly. In addition, PMD has observed through routine implementation support missions that community demand for ECED services is strong, yet participation in such services among the rural poor remains low;

Lessons learned The project’s ability to influence long–term outcomes is influenced by health and education supply–side constraints: Many of the constraints to improving the quality of services are embedded within the institutions tasked with delivering them. Communities lack the entry points, capacity, and authority required to motivate service providers and local governments to make improvements. The integration of PNPM principles (good governance, accountability, decision making, etc.) into sector service delivery programs described in the PNPM Roadmap is critical; Community target indicators should be reviewed regularly to ensure that they reflect Government

Well–trained facilitators are the backbone of PNPM: As is the case with PNPM Rural, strong facilitation is a critical factor for ensuring Generasi’s success. Facilitators are crucial behavior change agents and require a knowledge and understanding of health and education problems, entitlements, and programs in order to communicate effectively with communities during problem identification and planning activities. In 2012, training programs for facilitators were revised to better reflect the complexity of their tasks. In addition, PMD is working with sectoral agencies, most notably the Ministry of Health, to jointly develop training materials for Generasi facilitators with improved content related to maternal and child health and nutrition.

A child being weighed at a community health center. It is estimated that 42 percent of Indonesian children in rural households are stunted as a result of malnutrition (Yappen, Papua).


East Sumba: Changing attitudes to women’s health In terms of maternal and child health, East Sumba has one of the worst records of all districts in Indonesia, with an unacceptably high number of women continuing to die while giving birth. One of the major reasons for this appalling state of affairs is that women continue to give birth at home in their villages, without medical care or supervision. This state of affairs has persisted despite the presence and activities of a large number of NGOs, government agencies and other development actors who share the goals of reducing child and maternal mortality. One of the biggest challenges is that while these organizations and agencies share common goals, their activities have not been coordinated properly. As a result, the community gets frustrated with a range of programs that start and finish without achieving their intended goal. To overcome this, in 2009, PNPM Generasi gathered together with a number of local and international organizations to establish a forum to ensure that the goals of the various programs were better integrated and entrenched in regional development plans. To achieve this, the various actors engaged in a cooperative process to formulate village development plans that specifically addressed the issue of maternal health. These plans involved participatory processes and a community mapping of village assets and potentials. The plans were intended to ensure that all the activities of the disparate organizations and assets were coordinated to achieve the goals stated within those plans. So far, out of 159 villages in the district, plans of this sort have been established in 149 villages. One major benefit of this process has been the implementation of village regulations requiring women to give birth under medical supervision and mandating the provision of assistance to ensure that this happens. Because of the focused efforts of the different actors and because of the high level of community participation in the process of establishing these village plans, these regulations have become thoroughly socialized and accepted by all members of the community. Villagers are now proactively demanding that NGOs and government agencies implement their programs to ensure the proper provision of maternal

Jorge Nope, District Facilitator, East Sumba

health care, as agreed upon in the village development plans. As a result, in villages where the plans have been properly developed and integrated, the number of women giving birth without appropriate medical care has dropped to almost zero.


52 | 2012 PSF PROGRESS REPORT

Key Results

Result Indicators

Baseline

Total Target

Targets 2011

2012

2013

2014

Progress as Difference with of Dec 31, cumulative target for 2012 2012

Development Objective: Villagers in PNPM Rural locations to benefit from improved socio–economic and local governance conditions. # of direct project beneficiaries

3.1 million (2010)

6.1 million*

3.63 million

# of sub–districts with communities benefiting from improved access to health and education services

212

500**

290

369

369

500

344

Minus 25 (Sub– district grants for the 25 remaining sub–districts have been reallocated for execution during 2013.

Improved access to and utilization of health and education services in the targeted areas: • % of pregnant women receiving four prenatal care visits • % of deliveries assisted by trained professionals • % of children under five weighed monthly

80%; 75%; 75%

>85%, >75%, >75%

n/a

>80%, >75%, >75%

>80%, >75%, >75%

>85%, >75%, >75%

n/a

n/a

Improved access to and utilization of education services in the targeted areas: junior secondary enrollment rate

70%

75%

n/a

70%

75%

75%

n/a

n/a

% involved in planning and decision–making meeting: women; poorest community members

63%, 55%

>65%, >50%

>69%, >56%

>65%, >50%

>65%, >50%

>65%, >50%

65%, 58%

0, +8%

90% of program facilitators receive agreed upon training days in participatory planning and health and education topics

90%

90%

90%

90%

90%

94%

4% (25 facilitators have not yet completed pre–service training.)

0

8

0

8

16

9

1

Multi–sectoral regional and national evaluation workshops conducted

5.4 5.4 6.1 2.6 million— (Data from only 59% million million million Warning: of villages uploaded to Incomplete MIS for 2012 calendar Data year at date of writing. Anticipated that cumulative target of 5.4m will be met once data is verified and uploaded.)

* Horizon 2014/15, when the number of districts covered by the program should reach 500. ** The target defined in the legal documents (369) has already been met, but the GOI aims to scale–up the program to 500 poor sub–districts by 2014/15.


Window One | 53

PNPM Green Summary Information Status

Closing

Task Team Leader

Susanne Holste (sholste@worldbank.org)

Executing Agencies

Directorate of Village Natural Resources and Appropriate Technology & Directorate General for Village and Community Empowerment Ministry of Home Affairs, Operation Wallacea Trust (OWT ) (www.owt.or.id), Wildlife Conservation Society ( WCS) (www.wcs.org) and PSF

Start Date to Closing Date

28 March 2007 to 31 December 2012

Geographic Coverage

78 target sub–districts in the eight target provinces: Aceh, Bengkulu, North Sumatra, West Sumatra, North Sulawesi, South Sulawesi, Southeast Sulawesi, and West Sulawesi.

Approved Budget

US$52. million (PSF funded US$ 37.3 million and CIDA funded US$ 14.7 million)

Project Rationale and Overview PNPM Green was established in 2007 to pilot the integration of environmental sustainability into the PNPM Rural program by: (a) mainstreaming natural resource management issues into the community–driven development planning process; (b) increasing the environmental awareness and related management capacity of communities and government stakeholders; and (c) disbursing block grants to fund environmentally supportive green projects at the sub–district and district level. The program was developed in the context of the Government’s triple track plus one development strategy (pro–growth, pro–job, pro–poor, and pro–environment) to improve governance of natural resources and reduce vulnerability to climate change. Working at the village level, Green contributes to efforts to alleviate poverty with a particular focus on facilitating the generation of environmentally sustainable income and environmentally sustainable village development.

Notice placed on boards in rural areas play a vital role in keeping communities informed about PNPM projects, although increasingly, social media, such as Facebook and Twitter, is being used for the same purpose.


54 | 2012 PSF PROGRESS REPORT

The program replicated much of the PNPM Rural activity cycle, with villages empowered to propose and implement relevant environmentally sustainable activities under Green. Green sub–projects fell into three main categories, one of which piloted renewable rural electrification, while the others addressed issues of alternative income generation and natural resource management (mainly tree and mangrove planting) activities. Communities were provided with intensive awareness raising and specialized environmental facilitation support, including support provided by contracted civil society organizations (CSO) partners. Based on their improved understanding of their environmentally sustainable development options, villages put forward activity proposals, which were discussed and prioritized at the sub–district level. Following the selection of sub–projects, villages received block grants, activities were implemented, and monitoring, reporting, and auditing was conducted.

The Green Secretariat within the Directorate of Village Natural Resources and Appropriate Technology (SDATTG), under the Directorate General for Village and Community Empowerment (PMD) in the Ministry of Home Affairs, has been responsible for overall program implementation. For a number of reasons, particularly the administrative complexities and management capacity weaknesses of PNPM Rural, Green has ended up duplicating many of PNPM Rural’s structures and processes, rather than being integrated into them. This has limited the program’s potential to effectively mainstream environmental sustainability into PNPM Rural. These challenges are not dissimilar to those of the implementation set up of PNPM Generasi under PMD.

Progress in 2012 PNPM Green was originally slated to close in December 2012. During the year, the PSF team worked with

Figure 15. Key results–PNPM Green

912,000

2,500

TARGET

2,947

Beneficiaries

1,500,000

RESULT

Sub-projects

households deriving energy from renewable sources

32,000

36,277

TARGET

RESULT


Women participating in mangrove planting activities as part of a PNPM Green sub–project.


56 | 2012 PSF PROGRESS REPORT

the Green Secretariat and partner CSOs to ensure the delivery of the final cycle of Green block grants to target communities to achieve end–of–program targets. Particular support was provided to finalize a number of micro–hydro power sub–projects to ensure that they could be completed by December 2012. However, despite best efforts, around 14 MHP sub–projects will only be finalized in early 2013. Another priority was to assess the progress of the pilot program and draw out lessons to inform future innovations in progressing the green agenda under the core PNPM Rural program. Some program implementation challenges continued into 2012. Green was reliant on insufficient or unqualified technical facilitation for communities and weak verification processes for activity proposals. Despite these challenges Green has achieved its development objective and most of its target outcomes. Since its inception, the program disbursed almost 3,000 block grants, a number considerably higher than the target of 2,500. All 3,000 sub–projects except the abovementioned 14 MHP schemes were completed by December 2012. The block grants responded to the immediate needs of communities for the provision of productive services (sustainable income generation and supply of renewable energy) and facilitated the protection and rehabilitation of essential ecosystem services. Studies and field missions highlighted community investments in green activities that are self–sustaining, being replicated, and provide leverage to draw in other investment funds from district government and elsewhere. The Economic and Livelihood Report (2012) also showed that the program contributed to increased natural assets, alternative income generation, and capacity building in participating communities. The success of block grant funded activities was highly dependent on the extent to which activities met the immediate needs of beneficiaries, with income generating activities and planting activities on private land being the most sustainable. In the short term, the average household income from Green investments was Rp 630,000 (approximately US$66) per year in addition to annual savings of around Rp 676,000 (approximately US$71) per household (mostly from reduced use of oil, kerosene or firewood). Households interviewed for the study gave significantly higher estimates of returns on investment over the longer term (six years), with income for all types of projects estimated at more than Rp 5 billion (approximately US$526,315).

Future Plans Based on lessons learned from the pilot, the Government, the PSF and development partners are working on a follow–on activity under PNPM Rural to: (a) ensure that program processes and mechanisms promote and measure environmental outcomes; (b) increase the level of community investments in environmental initiatives funded by PNPM Rural block grants and the RLF, including the establishment of self–sustaining green enterprises and livelihood alternatives; and (c) test mechanisms for incentivizing the provision of ecosystem services that serve the global public good.

Lessons Learned The success of block grant funded activities is highly dependent on the extent to which activities meet the immediate needs of beneficiaries, with income generating activities and planting activities on private land being the most sustainable. Demonstrating links between green investments, poverty reduction, and income generation is essential in influencing the village development planning (RPJM–Des) process and activity proposals. PNPM Green investments build resilience and mitigation assets that contribute to climate change objectives. Investments in renewable energy and energy efficiency such as micro–hydro, biogas, and solar panels represent additional contributions to climate change outcomes at the community level. The yearly block grant cycle is problematic for demonstrating outcomes for many environmental activities, primarily because environmental outcomes generally take much longer to achieve. A lack of quick wins often limits the extent of community buy in or ownership for longer term outcomes. Problems of the yearly block grant cycle were exacerbated by late disbursement of block grant funds, forcing communities to undertake activities in unviable short timeframes, or in the wrong season, particularly difficult for planting activities. Future programs need to consider longer–term community financing mechanisms to enable results to become evident (including income returns on investment), which will increase community participation and ownership of environmental outcomes, as well as increase investment in maintenance. Further, long


Window One | 57

term funding and rewards for results can encourage sustained protection of ecosystem services that provide welfare and livelihood services by rewarding year–on–year performance. A consequence of developing PNPM Green as a standalone program has been to place pressure on sub–national program partners. The lack of integration of program streams (PNPM Rural, PNPM Generasi, and PNPM Green) at the national level has pushed the administrative burden downwards onto sub–national partners and participating communities, who as a result have to manage multiple systems and processes for the various PNPM program streams. Under

the Government’s Roadmap for PNPM Reform, there is a great opportunity to support further integration, with the proposed follow–on activity aiming to mainstream the positive lessons and operating systems from PNPM Green across the PNPM Rural program. Future programming approaches should prioritize program integration if PNPM is to become a cohesive poverty alleviation mechanism.

KeY RESULTS Targets Result Indicators

Baseline

Total Target

Before 2011

2011

2012

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To make the utilization of natural resources by rural communities sustainable Increased number of environmentally sound and/or NRM sub–projects implemented by communities in target location

Not conducted

2,500 green sub– projects

1,600

2,000

2,500

2,927

Plus 427 (Due to expansion into Sumatra)

Increased number of households deriving energy from renewable sources

Not conducted

32,300 households

15,200

24,300

32,300

36,277

Plus 4,277 (Due to expansion into Sumatra)

Number of program beneficiaries (male and female)

Not conducted

912,000 individuals of whom 456,000 are female

394,000 individuals

712,000 individuals of whom 356,000 are female

912,000 individuals of whom 456,000 are female

1,509,169 individuals of whom 754,782 are female

+ 597,169 individuals (of whom 298,782 are female)

Increased number of renewable energy (RE) projects financed through PNPM and being properly managed by participating communities

Not conducted

250 RE schemes

75

150

250

411

161

Increased number of households receiving electricity through PNPM– finances MHP schemes

Not conducted

22,000 households

10,000

20,000

22,000

21,567

Minus 433 (Number will increase when final 14 MHP schemes are completed)


Tlogoweru: Using Owls to Eliminate Rats In the village of Tlogoweru, more than 90 percent of the population depends on rice farming for their living. One of the biggest problems facing the village has always been the great loss of the rice crop to field rats, which are endemic to the region. In some years, losses from the depredations of field rats have amounted to more than half of the annual crop. The rats are the main constraint against the villagers improving their standard of living. Because of the poor crop yields, a large number of young people in the village have been forced to move away, to try to find work in Jakarta or the big cities of Central Java. In the past, the sub–district government has taken a number of steps to address the problem, using traps, poison and other means, but none of these measures have been effective. One of the villagers here heard that in other districts of Central Java, villagers have encouraged the preservation and cultivation of owls, which are natural predators of the field rats, as a means of addressing the problem. It is estimated that a single owl eats at least three rats per night, which means that one owl can eliminate more than a thousand rats each year. The villager decided to conduct a study tour to villages that have used owls for this purpose, which was how our program begun. PNPM has played a vital role in the development of the program. While PNPM funds have not been used directly to support the program, PNPM programs have been established in the village for years, with a number of villagers having established mutual support groups for farmers and women to access revolving loans funds and to develop infrastructure. These groups have provided a solid foundation for collective, community planning and action. The benefit of PNPM is not just in terms of the access to funds, but in terms of building the capacity of farmers for community organization. Through these groups, villagers have raised funds amounting to almost Rp 100 million (approximately US$10,526) to develop nests and perches to house owls and to hatch young owls from eggs. The institutions that have been developed through PNPM play a role that goes beyond the specific program. By now, more than 70 owls are housed in specially constructed houses in the rice fields. As a result, rice yields in the village have improved by more than 40 percent over the past year. In addition, the village has become widely recognized for this initiative, attracting local tourists who want to see the program in action. The

Sutejo, Village Head in Tlogoweru and one of the drivers of the ‘owl program’.

governor and the district head have visited the village on several occasions to inspect the program, as have representatives from village administrations and farmers groups from across the province and beyond. Many of these visitors have been inspired by a desire to implement similar programs in their own villages. This is a success not just for environmental sustainability, but for community organization.


Window One | 59

Disaster Management Support Summary Information Status

Active

Task Team Leaders

Sentot Satria (ssatria@worldbank.org) George Soraya (gsoraya@worldbank.org)

Executing Agencies

PNPM Rural: Directorate of Community Institutions and Training, Directorate General of Community Empowerment, Ministry of Home Affairs Indonesia. PNPM Urban/Rekompak: Directorate General of Human Settlements (DGHS), Ministry of Public Works

Start Date to Closing Date

23 March 2011 to 31 December 2013 for the PNPM Rural and Rekompak components (a twelve month extension has recently been approved) 23 March 2011 to 31 December 2012 for the PNPM Urban component (now closed)

Geographic Coverage

3 Provinces (Central Java, Yogyakarta Special Region and West Sumatra)

Approved Budget

US$27 million through three existing programs: PNPM Rural: US$14.1 million PNPM Urban: US$1.4 million Rekompak: US$11.5 million

Project Rationale and Overview In October 2010, Indonesia was struck by several major natural disasters, including an earthquake which triggered a tsunami that hit Mentawai ( West Sumatra) and the volcanic eruption of Mount Merapi (Central Java and Yogyakarta Special Region). These events resulted in the deaths of hundreds of people and the displacement of tens of thousands, causing significant economic losses to the already poor populations. The Government requested emergency assistance to use the PNPM platform as a key instrument in its recovery strategy for Mentawai, Central Java and Yogyakarta. The Government also asked that special funding for disaster recovery be made available in other locations should the need arise. The PSF’s Joint Management Committee (JMC) responded positively to the Government’s request by setting up this project in 2011.

The objective of the Disaster Management Support project is to support the Government’s disaster management efforts at the community level through three ongoing operations: PNPM Rural, PNPM Urban and the Community–Based Settlement Rehabilitation and Reconstruction (Rekompak) program. The project covers three provinces (Central Java, Yogyakarta Special Region and West Sumatra), 196 villages (PNPM Rural), 38 wards (PNPM Urban) and 45 villages (Rekompak). In areas affected by the Merapi volcanic eruption, the project supports the post–eruption rehabilitation and reconstruction objectives laid out in the ‘Renaksi RR Merapi’ (Action Plan for Merapi Rehabilitation and Reconstruction) enacted through Perka No. 14, 2011 (Regulation of the BNPB/National Agency for Disaster Management). This Action Plan has been amended to include villages affected by successive lava flows. The grants, which are intended to help finance the costs associated with disaster management efforts, have three components: (a) Disaster Recovery Kecamatan (Sub–District) Grants; (b) Facilitation Support; and (c) Implementation Support and Technical Assistance. Post–disaster grants are additional to the regular PNPM block grants. In a situation where a disaster occurs before the regular grant has been disbursed, the project’s operational policies allow communities to use the regular rural block grant to conduct cash–for–work activities and to facilitate the provision of social funds to respond to emergency situations, to build temporary shelters, and for other similar purposes, before the post–disaster grant becomes available. The additional grant then allows villagers to rebuild damaged infrastructure. The project got off to a slow start because of rigidities in the Government’s budget systems and procedures, which delayed the disbursement of block grants in affected areas. However, implementation subsequently gathered momentum and, by the end of 2011, the Disaster Management Fund had disbursed more than US$9 million to support communities affected by the Merapi eruption, facilitating cash–for–work programs that provided a total of more than 800,000 days of employment for members of local communities. The cash–for–work programs first supported cleanup activities and then the reconstruction of infrastructure. To make up for initial delays in disbursements, the Government was granted a 12 month extension to continue implementing sub–projects under PNPM Rural and Rekompak. The new closing date for the project is 31 December 2013.


60 | 2012 PSF PROGRESS REPORT

Lhokseumawe, Aceh, one week after the 2004 Tsunami, in which almost quarter of a million people died, most of them in Aceh.

Progress in 2012 Cash–for–work activities were closed in 2011, and remaining funds were allocated for Disaster Risk Reduction (DRR) activities and the reconstruction of housing and basic infrastructure. By the end of 2012, US$23.5 million (or 87 percent of the total budget) had been disbursed to support communities affected by the Merapi and Mentawai disasters. Progress under each project in 2012 was as follows: PNPM Rural: In 2012, the Mentawai district became one of the recipients of the post–disaster grants. Activities have been focused on the rehabilitation and reconstruction of damaged infrastructure. The Government allocated US$6.9 million for Central Java, US$600,000 for Yogyakarta Special Region, and US$2.2 million for Mentawai. Central Java and Yogyakarta Special Region fully disbursed the allocated funding, while West Sumatra disbursed only 50 percent because of the late budget allocation. In total, 787 sub–projects8 were selected for funding in 2012, benefiting 491,593 beneficiaries, 50 percent of whom were women and 45 percent of whom were from poor households. Of these sub–projects, 706 were completed by the end of 2012, with the remaining 74 scheduled for completion in 2013. The level of community participation

8 74 in West Sumatra, 662 in Central Java and 51 in D.I. Yogyakarta. The types of sub–project categories are as follows: public facilities (700), education (28), health (1) and Revolving Loan Activities (51).

in activities has been very strong, which has helped quicken the pace of recovery. Participating communities have also developed a good understanding of how to respond to disasters. PNPM Urban: DRR activities planned for 2012 in 38 wards in Central Java and Yogyakarta were completed and the project closed in December 2012. Rekompak: By the end of 2012, the project had disbursed US$10.7 million for housing and infrastructure reconstruction and technical assistance, with 101 target villages having completed Community Settlement Plans. Out of 101 villages, 56 percent have completed small infrastructures activities and 954 houses have been reconstructed in safe locations. It was expected that all housing and reconstruction activities financed by PSF funding would be completed by December 2012. However, the negotiation of relocation agreements and policy decisions to settle land tenure issues have taken longer than expected. The documentation of all land acquisition and relocation processes is now progressing well, with systematic checking of the processes being facilitated through a website. Coordination among national and local government agencies to produce clear spatial development policies and regulations for the Merapi region has taken considerable time and continuous support by the Rekompak team is required.


Window One | 61

The BNPB recently assumed a leading role in the coordination of the various programs which facilitate post–disaster response. It is expected that PNPM facilitators who participated in the post–disaster response are now capable of providing specialized assistance should another disaster occur. BNPB has formally adopted Rekompak for the reconstruction of Merapi–affected settlements and provided additional funding to the program to support areas affected by subsequent lava flows. This is a major institutional development for future reconstruction efforts.

Future Plans Activities under PNPM Urban have now been closed. In 2013, PNPM Rural and Rekompak’s implementing agencies will focus on completing all planned activities under the agreed no–cost extension, as follows: PNPM Rural: Implementation needs to be accelerated in Mentawai and fiduciary controls strengthened through the deployment of additional staff and close oversight by PMD. Out of a total 3,489 sub–projects in all target areas, 74 sub–projects are still ongoing and will be completed in 2013. Rekompak: During the first months of 2013, the project will focus on facilitating an intensive dialogue with communities who have not yet decided whether to stay or relocate, and on finalizing new housing and infrastructure in relocation sites. Infrastructure support will continue for selected villages in high–risk areas, which still need DRR measures. An additional grant from the New Zealand government is being prepared through the Global Fund for Disaster Risk Reduction9 to support infrastructure, livelihoods and capacity building activities, which will complement this project.

Lessons learned PNPM Rural was able to respond effectively to the twin disasters because the program was ongoing, which meant its network of facilitators and community structures was in place before the disasters struck. PMD used the PNPM Rural loans to provide additional block grants on top of the regular block grants (which in Central Java and Yogyakarta had already been fully utilized by October) to allow affected villages to conduct additional post–disaster activities. However, disbursements of the Post–Disaster Grant funding

9 GFDRR has already linked to CSRRP and supported complementary interventions, currently on–going: (a) Ecosystem restoration demonstration plots to help owners restore the productivity of land in high risk areas damaged by the lava, and change the land–use into conservational and agricultural, non –residential functions; (b) Provision of digital maps to 13 villages to support planning. These programs are instrumental in encouraging increased involvement of local government agencies in the recovery and future development management in the region.

under this project work were delayed because these disbursements needed to be added first to PNPM Rural’s budget through a revision of the Government budget. The grant was signed and became effective in March 2012, five months after the disaster, but funds only became available in the budget in August 2012, or ten months after the disaster. The lack of adequate communication among key ministries seemed to be a reason for the delays to the DIPA revision. A key lesson is that it is necessary to pre–identify resource people in key government agencies, especially in the Ministry of Finance, who can help fast–track processes or facilitate the implementation of new policy. BNPB now coordinates all stages of disaster mitigation, management and recovery process. A close collaboration between the executing ministries (MOHA and MPW ) and BNPB is vital for effective disaster response. Mentawai is still finding it difficult to begin reconstruction activities, even though it has now been more than two years since the tsunami struck the island. Mentawai is a remote island and access is very difficult. This has previously hampered the implementation of PNPM Rural and now hinders post–disaster recovery. In cases of such remote locations, PMD needs to be very proactive to mobilize additional facilitators and supervisors. Additional allowances to facilitate and incentivize staff deployment in remote areas are available from the project and should be used. One of the main challenges under Rekompak has been to involve villagers, especially affected families, in an analysis of risks and opportunities and to decide on a new settlement plan, possibly involving relocation. To ensure that resettled households or other villagers do not return to hazard areas will be a continuous challenge. The program is still developing tools and approaches to raise villagers’ awareness of the risks associated with residents in such areas, with involvement from local governments. Assistance in post–eruption areas required additional processes to those previously implemented in post–tsunami and post–earthquake areas. These included gathering and analyzing detailed risk information, the conversion of village–owned land into land for new housing, participatory site–planning and the development of communal sanitation facilities to be managed by communities. Resettlement should be managed in parallel with livelihoods support, as the sustainability of the new neighborhoods will heavily depend on economic opportunities for the relocated communities. Without such opportunities, the pressure to return to the original high–risk sites will be too high.


62 | 2012 PSF PROGRESS REPORT

Key Results

Result Indicators

Unit of Measure

Baseline

Total Target

Targets 2011

2012

2013

Difference with Progress as of cumulative target for Dec 31, 2012 2012

PDO: To support the Government’s disaster management efforts at the community level through three ongoing operations. PNPM Rural # of paid work days generated by cash–for–work programs

# of paid work days

0

No targets were pre– defined

n/a

n/a

n/a

715,398

Cash–for–work program completed in 2011.

# of workers enrolled in cash– for–work programs

# of workers enrolled

0

No targets were pre– defined

n/a

n/a

n/a

# of completed sub–projects

# of projects completed

0

3,489

2,709

3,489

3,415

74 projects will be completed in 2013.

percent of infrastructure projects evaluated as of high quality

percent of projects of high quality

0

>50 percent

n/a

>50 percent

Assessment not conducted yet

The assessment will be conducted in 2013.

# of employment days generated for cash–for–work programs

# of employment days

0

n/a

n/a

n/a

82,000

Cash–for–work programs were completed in December 2011

DRR activities implemented

# of sub– districts where DRR activities have been implemented

0

38

38

38

On target

# of houses completed by the end of the project

# of houses

0

2,0453

1,636

2,045

2,045

954

Minus 1,091 (823 are ongoing, while 268 are in pre–construction stages. The total target is being reviewed and will probably be reduced)

percent of target villages that have restored basic community infrastructures

percent of villages

0

100 percent (101 villages)

Cash–for–work program 157,377 workers, inc: completed in 2011. 84,366 women workers & 82,856 poor households.

PNPM Urban

Rekompak

30 100 100 55 percent (56 percent percent percent villages) (30 (101) villages)

Minus 45 (Negotiation of relocation agreements & policy decisions to settle land tenure issues have taken more time than anticipated, delaying works. All will be completed in 2013.)

* Whereas the total funding located for housing and infrastructure will increase with BNPB’s contribution, the total targets for housing and/or infrastructure works


Window One | 63

Additional Financing for Post–Crisis Support Summary Information Status

Closed

Task Team Leader

Sentot Satria (ssatria@worldbank.org)

Executing Agency

Directorate General of Village and Community Empowerment, Ministry of Home Affairs

Start Date to Closing Date

6 June 2011 to 31 December 2012

Geographic Coverage

433 sub–districts in 86 districts within 7 provinces: Bengkulu, Gorontalo, Central Java, East Java, Maluku, NTT and Central Sulawesi

Approved Budget

US$32.7 million

Project Rationale and Overview While Indonesia weathered the global financial crisis better than many countries, it still incurred negative economic impacts, including a reduction in employment and incomes. Nearly 50 percent of Indonesians live on less than US$2 per day and 14 percent of the population is below the official national poverty line. Sixty percent of those below the poverty line are in rural areas. The rural poor are particularly vulnerable to rice price shocks, with two thirds of their income spending on food and one quarter on rice. In the context of the impact of the global financial crisis and of the gap in the socio–economic status between those in rural and urban areas, the Government requested PSF financing to provide special support for the rural poor in seven provinces where a significant proportion of rural households live below the national poverty line and where a majority of the sub–districts in the provinces perform well under the PNPM Rural program. This support is intended to increase the impact of the PNPM Rural program in these areas. Under this project, 433 sub–districts in 86 districts were selected to receive additional funding allocations, with the value of these allocations determined on the basis of the population of the recipient sub–district. The grant financed the incremental scaling up of PNPM Rural project activities to enhance the poverty impact of the project in the seven targeted provinces. The project provided

grants to beneficiaries for: (a) planning for community development, including the preparation of sub–grant proposals; (b) training and capacity building, including in development planning and investment; (c) investment in social and economic infrastructure identified through community development planning; and (d) investment in activities identified through community development planning using revolving loan funds (RLF). The project also financed additional facilitation support to effectively administer PNPM in the project areas and to absorb the supplemental funding for block grants. The project’s development objective was the same as for the main PNPM Rural program: to ensure that villagers benefit from improved socio–economic and local governance conditions. Project funding was approved by the JMC in June 2011, with funding allocated under the Government’s annual budget in September 2011. In total, 2,794 projects were selected by communities in 433 sub–districts to receive funding under the project. Community priorities were the same as under the regular PNPM Rural program, with 75 percent of block grants, involving a total of 2085 sub–projects, allocated to build and develop basic village infrastructure (roads, bridges, irrigation, water supply, and markets, etc.). A further 23 percent of block grants, involving a total of 539 sub–projects, were allocated to build and develop health and education infrastructure (construction of schools, health posts, equipment, scholarships, incentives, etc.), while 3 percent was allocated for revolving loan funds to support 170 activities implemented by 691 groups. The disbursement of block grants began in December 2011.

Progress in 2012 By the end of 2012, all funds (100 percent) allocated for block grants had been disbursed. Out of the 2,794 selected sub–projects, 2,790 (2,082 infrastructure, 538 health and education and 170 RLF activities) have been completed to benefit more than 1.9 million people in the target provinces. The construction work resulted in the creation of more than 1 million days of paid employment for approximately 70,430 workers. The National Government Audit Agency (BPKP) conducted visits to 77 sub–districts in the project areas as part of its 2011 auditing process (18 percent sample) and stated an unqualified opinion. The implementing agency decided to use PNPM Rural facilitators in project areas and not to recruit additional facilitators to support post–crisis implementation. The allocation for facilitation support will be refunded to the PSF parent account.


64 | 2012 PSF PROGRESS REPORT

Future Plans

Lessons learned

The project closed as scheduled on December 31, 2012.

This project demonstrated once again that the PNPM Rural platform can be used effectively to provide additional funding for communities that are affected by global or local crises and support their socio–economic recovery. However, special programs that use the PNPM Rural platform to channel additional block grants put an additional strain on the program’s governance systems. Thus, there is a need to ensure that these programs deploy additional human resources to assist overburdened facilitators and other key personnel.

PNPM Rural’s Management Information System has been struggling to deal with the strain created by the scale–up of the program, and the strain has been exacerbated by the provision of these additional block grants, especially as budget allocations are disbursed at different points in the fiscal year. The quality of facilitation and the effectiveness of targeting have been identified as important implementation challenges, which should be reviewed and addressed if and when similar projects are implemented in the future.

Figure 16. Achievements under Post–Crisis

2,790

Over

Sub-projects completed out of 2,794 planned

1 million poor paid workdays for community members 70,000 enrolled in cash for work

1.88 million beneficiaries

beneficiaries are 56% ofthe poorest community members


Window One | 65

Key Results

Targets Result Indicators

Baseline

Total Target

2011

2012

2013

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: Villagers in PNPM Rural locations benefit from improved socio–economic and local governance conditions Indicator One: Improved HH expenditure rates and improved access to economic and social services in a minimum of 370 sub–districts in 2012 (impacts taken from representative sample)

2% increase above control group per project cycle (based on previous evaluation of KDP2)

2% increase above control group

2%

2 %

N/A

9.1% increase of consumption rate of poor household in PNPM areas (based on 2011 impact evaluation)

plus 7.1%*

Indicator Two: EIRRs> 30% for main rural infrastructure categories

EIRR between 39%–68% (KDP2)

EIRR>30%

>30%

>30%

N/A

35–50%

+5–20%*

Indicator Three: >80% satisfaction levels from beneficiaries regarding improved services and local level governance

Previous satisfaction levels>80% (KDP2)

>80%

>80%

>80%

N/A

89%

+9%*

50% participation rate of women and poorest community members in planning and decision making meetings

48% for women 56% for poorest community members (2008)

50% participation rate for women and poorest community members

50%

50%

N/A

50% for women 53% for poorest

On target for women; + 3% for poorest

# and type of infrastructure works, economic and education and health sub–projects/ activities completed in target sub–districts

NA

N/A (but 2,794 sub projects were selected for funding)

0

2,794

N/A

2,790

Minus 4—4 remaining infrastructures have been completed but not yet handed over.

>70% of infrastructure works are evaluated as of high quality

65% (2008)

>70%

>70%

>70%

N/A

82%

+12%

70% of agreed additional consultants are recruited and trained

NA

>70%

>70%

>70%

N/A

Implementing agency decided to use regular facilitators

Minus 70%

* Data are the same as for the regular PNPM Rural program, and impacts taken from a representative sample of rural locations. No impact study/survey was conducted for Post–crisis locations, specifically.


A sub-district facilitator inspects the construction of a PNPM road building project.


Window Two Implementation and Coordination Support

The PSF makes significant investments in PNPM’s core functions and systems, which will need to be sustained under any vision of more integrated local and community–driven development. To date, the PSF has disbursed more than US$22 million to provide supervisory and coordination support, as well as technical assistance to PNPM’s implementing agencies and oversight bodies. Well–trained facilitators are the backbone of PNPM. In 2012, the PSF launched a number of projects to enhance the quality of facilitation in the program. The third phase of the Community Facilitators Development project has already helped to establish an independent Institute for Professional Certification of Community Facilitators (LSP) and to develop the certification process and materials which will be used to assess facilitators. The LSP trained and accredited 55 assessors and 10 certification centers in 2012. The process of certification will begin in 2013. Despite some delays, the target of certifying 3,000 facilitators in 2013 is still on track, with a possibility of reaching more than 5,000. To help address the chronic shortage of facilitators in Papua and the specific challenges they face, the PSF also launched a third wave of the Barefoot Engineers training program, which will train another 300 young Papuan graduates to become technical facilitators. This six–month training program started in October. A concept for an Enhanced Empowerment Experiment is also being prepared to demonstrate the impact of a more comprehensive approach to facilitation and capacity–building. With community fatigue being commonly reported as an obstacle to active participation, new approaches may also be needed to revitalize the empowerment process. The PSF launched the second phase of the Creative Communities project to use cultural methodologies to remobilize communities in the empowerment process. The implementation of pilot activities will start in 2013.

The state of governance in PNPM is still remarkably strong but systems are under stress and there is no room for complacency. In 2012, the PSF continued to increase the reach and depth of the supervisory and fiduciary support provided to PNPM’s implementing agencies and oversight bodies. Field analysts visited 496 sub–districts in 2012 alone to provide portfolio–wide assistance (15 PNPM and associated programs covered in 2012) and to engage local stakeholders. Locations for supervision continued to be prioritized on the basis of well–known risk factors such as high disbursement, multiple block grants, high turn–over of project facilitators, remote areas, etc. A more proactive engagement of local stakeholders through joint missions, workshops to analyze systemic issues, and a collaborative definition of action plans appear to be paying off, with local governments undertaking hundreds of corrective actions to address implementation issues. A team of fiduciary specialists also assists implementing agencies in assessing the robustness of PNPM’s fiduciary controls; supports the Government in resolving complaints and corruption cases; and produces in–depth analyses on the program’s governance framework to propose continuous improvements. The field and fiduciary teams coordinate their work with the PNPM Rural and PNPM Urban task teams, which provide national–level oversight and thematic reviews and engage in higher level policy dialogue with PNPM Rural and PNPM Urban’s implementing agencies. Six thematic reviews on specific aspects of program performance and governance were completed in 2012 alone to assist the Government in identifying areas requiring strengthening and opportunities for pilot development.10 One such area is the provision of legal support to communities to deal

10 A review of program implementation, a review of gender practices, small scale study on economic internal rate of return, a review of implementation progress in Papua and two governance reviews.


68 | 2012 PSF PROGRESS REPORT

with large corruption cases. The JMC recently approved the PNPM Justice project, which will deploy lawyers in all of Indonesia’s provinces to assist PNPM communities in obtaining redress. Building on field findings, PSF staff provided follow–up technical assistance to PNPM implementing agencies to: (a) strengthen their Management Information Systems (MIS), Complaints Handling Systems (CHS) and PNPM’s fiduciary controls; (b) follow–up on audit recommendations; and (c) review and update operational policies and guidelines, etc. One of the most critical areas to strengthen the management of PNPM is an improved MIS. PNPM Urban may be one step ahead of PNPM Rural in this regard, as the MIS data are 90 percent complete, on average, with their quality greatly improved. AusAID has provided bilateral funding for an independent system analysis and redesign of PNPM Rural’s MIS, which started in early 2012. The PSF provided inputs into the terms of reference and closely monitors the firm’s work. As of December 2012, the contractor has reviewed the existing MIS at central and sub–national levels and has drafted the master plan for the MIS. The PSF is also supporting the design, installation, and operation of an integrated MIS for all PNPM programs, SIMPADU, which now receives data directly from 13 core and special programs. Technical assistance was also embedded in the Steering Committee of PNPM (Pokja Pengendali) and the National Development Planning Agency (BAPPENAS) to support their important role as overseers of the program, and in the Ministry for Development of Disadvantaged Regions (KPDT ) to help fulfill its coordination role in disadvantaged areas. Although this support has contributed to progressing some key reforms, capacity

issues at all levels continue to constrain the quality of implementation of the program. Clearly technical assistance, however intensive, will not resolve capacity constraints within implementing agencies, and actually may in some cases entrench them by increasing reliance on external support and substituting for their core roles. Addressing these issues will require ensuring that adequate resources and civil service personnel are made available for the management of the program and a re–engineering of management systems. Building on the recommendations of a management review of the Directorate for Community and Village Empowerment (PMD), the implementing agency for PNPM Rural, the PSF is currently assisting PMD in preparing the establishment of a Joint Secretariat, which will be professionally staffed to support PMD. The PSF increasingly uses Information Communication Technology (ICT ) to more effectively provide information; to support the sharing of experiences among PNPM stakeholders; and to promote transparency and accountability within PNPM communities. The PNPM Communications Team is working with Government to develop a communications platform for PNPM, which will use social media, such as Facebook and Twitter, SMS, Multimedia messaging and Geo–mapping, to enhance the usability and online exposure of information on PNPM programs and to strengthen the ability of communities to ask questions and raise issues for debate, particularly concerning budgets and service delivery, and thus help close the feedback loop at the national level. A network of 150 radio stations in nine provinces already facilitates discussion with local communities and promotes community–based monitoring of PNPM programs.


Window Two | 69

PNPM Rural Implementation Support Summary Information Status

Active

Task Team Leaders

Susanne Holste (sholste@worldbank.org) Sentot S. Satria (ssatria@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

14 May 2008 to 31 December 2014

Geographic Coverage

National, covering 57,000 rural villages in 5,100 sub– districts in 393 districts in 32 provinces.

Approved Budget

US$ 5.1 million

Project Rationale and Overview PNPM is the largest community–driven development program in Indonesia and possibly the largest such program in the world. Since its establishment, the program’s coverage has expanded dramatically, from 2,600 sub–districts in 2008 to more than 5,000 sub–districts by 2012. The program continues to produce good results, with the provision of direct control over decision–making and resources to communities leading to improved governance and socio–economic conditions. The rapid expansion, however, has placed significant strain on the program’s management and governance frameworks. To address this, ongoing incremental supervision support, both from the Government and development partners, is required.

with PNPM Rural’s implementing agency, the Directorate General of Village Community Empowerment (PMD) within the Ministry of Home Affairs (MOHA), and the PNPM Steering Committee (Pokja Pengendali). The project assists PMD to formulate recommendations, strategies and policies on the basis of Technical Assistance ( TA) and thematic reviews. The field–based supervisory and fiduciary support provides portfolio–wide implementation assistance and engages with local–level project stakeholders. The field–level analyses are then aggregated to assist PMD to identify issues that need to be addressed and opportunities for pilot development. In 2011, separate activities were established for: (a) Implementation Support and Monitoring; and (b) Field–Based Implementation Support and Governance and Fiduciary Support. In 2011, the Government and development partners identified five main issues that required support under the Implementation Support and Monitoring project: (a) MOHA’s institutional and managerial capacity to implement PNPM Rural successfully; (b) a Management Information System (MIS) that had become dysfunctional and no longer provided reliable and comprehensive data to inform decision–making and reporting; (c) a Complaints Handling System (CHS) that no longer provided an avenue for the redress of grievances, especially the detection, monitoring and timely resolution of fraud and corruption cases; (d) oversight and enforcement of formal and informal fiduciary controls that has weakened; and (e) inadequate management of the facilitators, particularly in terms of their training, career development and levels of remuneration.

Progress in 2012 An implementation support trust fund was approved in May 2008 to facilitate the provision of additional supervision and reporting for PNPM’s core programs and thus to ensure full supervision coverage. In 2009, a separate trust fund was established to facilitate improvements to the supervision of PNPM Urban. In 2010, two separate projects under a single trust fund were established, with these projects working in close cooperation, these being: (a) Implementation Support and Monitoring of PNPM Rural and the two Papua–based initiatives, PNPM Rural/RESPEK and PNPM Agriculture; and (b) Field–Based Implementation Support and Governance and Fiduciary Support. The Implementation Support team provides national–level oversight; conducts thematic reviews; and engages in higher–level policy dialogue

To address the issues identified in the previous section, the PSF has continued to implement ongoing field–based monitoring of program implementation; it has engaged in technical discussions on governance and fiduciary management; and it has conducted studies and evaluations as a basis for improvements. Regular multi–stakeholder missions were organized to review systemic issues, such as the level of performance of facilitators, follow up of audit recommendations, and quality of monitoring. One of the most critical needs to improve the management of PNPM Rural is an improved MIS. To achieve this, AusAID provided bilateral funding for an analysis and redesign of the MIS system, with work


70 | 2012 PSF PROGRESS REPORT

Under PNPM Rural, over 18,000 kilometers of roads were built in rural areas in 2010.

beginning in early 2012. PSF staff provided inputs to facilitate the selection process and to develop the terms of reference of the firm contracted to conduct the analysis and redesign. Following the deployment of the firm, the team continued to closely monitor the firm’s work. As of December 2012, the contractor had reviewed the existing MIS at central and sub–national levels and drafted a master plan for the MIS. There are some concerns that the contracted firm might not be fully capturing the information and control needs of the program. Further work needs to be conducted to identify the key indicators before proceeding with the final design. Most complaints related to PNPM Rural are resolved at the community level. However, when problems cannot be managed at the community level, it is essential that there be a well–functioning CHS so that issues can be escalated for resolution. To achieve this, the PSF has provided support to resolve technical issues. The CHS is again functioning and able to receive complaints online. The CHS facilitates the following up of complaints through a cascade system based on the level of complaints. The PSF also continued to assist PMD to strengthen PNPM Rural’s fiduciary controls. A joint review of the standard

operating procedures for internal auditing led to a complete rewrite of these procedures, followed by field testing. While there are relatively few cases of fraud and corruption in PNPM Rural, a growing number of such cases has been observed with the revolving loan funds (RLF) component. Using the limited data available on RLF, an analysis mapped the assets and idle capital held in each province and created a risk profile. In the area of the management of facilitators, the PSF worked with PMD and Pokja Pengendali to review remuneration and benefits packages for facilitators working in other development programs, particularly those working in remote areas, to compare these packages with those received by facilitators under the PMPM program. On this basis, Pokja Pengendali endorsed revised remuneration and allowances for PNPM facilitators working in remote areas. The PSF also assisted with the review of training materials for pre–service and refresher training programs. The project supported an ambitious program of analytical work and implementation reviews to further develop an evidence–base to inform program improvements and the design of the PNPM Roadmap. In 2012, the following


Window Two | 71

work was undertaken: zz Reviews of program implementation: These focused on the technical quality and usage of rural infrastructure in 12 provinces, including levels of fiduciary compliance and safeguard implementation; zz Review on gender practices in PNPM Rural : This review identified good practices on inclusion of women in the program and areas for improvement, such as in outreach; zz Small scale study on Economic Internal Rate of Return (EIRR): This study was conducted to assess economic benefits accruing to the population from the investments; zz Review of implementation progress in Papua : This review was conducted to provide operational recommendations for adapting PNPM Rural to unique circumstances in Papua; zz Two governance reviews: (a) a community–level governance review was conducted to determine how participation and inclusion are practiced and to identify the weaknesses that allow corruption to occur. The review recommended establishing a clearer mandate for PNPM’s sub–district governance bodies and village–level social audits; and (b) a management review assessed PMD’s capacity, at the central level, to manage the program. The review recommended deploying a dedicated team of staff to manage the program, to accelerate the redesign of the MIS and CHS, and to improve the quality of facilitators. The PSF also facilitated a review of lessons learned from the previous phases of PNPM Rural to inform design improvements, including: (a) increased emphasis on community empowerment through better trained and managed facilitators; and (b) an increased role for village institutions and community cadres. Consistent with the PMD management review recommendations, the PSF, including Pokja Pengendali, recommended that PMD establish a Joint Secretariat comprised of representatives of the relevant directorates in PMD to improve PNPM’s coordination and programming. PMD committed to establishing the Joint Secretariat by July 2013.

Future Plans In 2013, particular emphasis will be placed on: (a) providing assistance to establish the Joint Secretariat; (b) supporting more inclusive decision–making and empowerment in the communities; and (c) developing a strategy for rural livelihoods that reflects the changing dynamics of rural Indonesia. Additionally, an approach will be agreed upon with the Government to mitigate the risks

that the PNPM platform might be misused for political purposes in the context of the 2014 presidential election. Specific agreed–upon activities include the following: zz Providing technical assistance to strengthen PNPM management (finalization of CHS and MIS; setting up of joint secretariat; institutional options under PNPM Roadmap); zz Supporting the adaptation of PNPM to changing development needs (refinement of block grant allocation formula; targeted delivery model for remote areas; development of a strategy and pilot for rural livelihoods; design of Enhanced Empowerment Experiment); zz Helping Government implement the PNPM Roadmap, including the development of detailed action plans and pilots; zz Supporting capacity development within PMD and Pokja Pengendali through participation in South–South learning events, training courses, etc.; zz Continuing national–level implementation support.

Lessons learned A program of the scale and complexity of PNPM Rural requires substantial resources for implementation support, including for multifaceted dialogue with partners and government, adequate staffing, and visits to remote areas. Findings from implementation support missions need to be intensively socialized with government partners and used to strengthen program implementation. Multi–stakeholder workshops and missions are extremely useful to foster understanding and ownership of all government agencies involved in PNPM Rural. The Government needs to be strengthened in its ability to provide oversight and supervision of PNPM.


72 | 2012 PSF PROGRESS REPORT

Key Results Note: A revised Results Framework will be submitted for JMC approval in 2013 together with a request for additional financing.

Result Indicators

Baseline

Total Target

Targets 2011

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To provide technical support, guidance and supervision to the overall PNPM Rural activities through field–based monitoring and support, governance, fiduciary, M&E. PMD’s PNPM capacity to operations manage the in PMD PNPM opera­ managed tions under in silos its mandate is enhanced

Establish­ ment of a Joint Secretariat facilitated ; MIS & CHS overhauled

Preparations for Joint Secretariat ; Management Review

Joint Secre­ tariat estab­ lished

Completion of MIS & CHS overhaul

Mgt Re­ view; TOR endorsed by Pokja; MIS analysis underway; CHS redesign completed

On track

Field super­ vision, sys­ tem reviews & studies help shape the policy dialogue on PNPM Rural & PNPM Mandiri

n/a

Key reform Implementa­ Field The PSF findings areas to inputs incor­ tion support translate strengthen porated in to PNPM into a stra­ PNPM Rural PNPM Road­ Roadmap tegic reform governance map; Studies provided, agenda for identified inform PNPM including Rural 2012–2015 action plans and pilots

Continues

5 key reform areas defined in 2011 and follow–on support since; Inputs incorporated in Roadmap; Mission aide–mem­ oires; Gender Review

On track

# of risk– based super­ vision p.a

4 p.a. (2011)

6 p.a.

4

6

12

18

6

On target

Strategy for economic inclusion developed

n/a

Strategy for economic inclusion developed by 2013

Concept paper developed through series of workshops with stake­ holders

Strategy developed

RLF UPK review in 4 provinces; review of RLF beneficiaries in 16 prov­ inces

Delayed. Concept paper ex­ pected late 2013

Impact of a more com­ prehensive approach to capacity building & facilitation demon­ strated

n/a

Enhanced Empow­ erment Experiment (EEE) com­ pleted

EEE proposal finalized for review by the JMC

EEE imple­ mented

EEE informs improve­ ments to capacity building ap­ proach & facilitation

Scoping mis­ sion; Design ongoing

Delayed. JMC ap­ proval expected 3rd quarter

Customized approach developed for remote areas, start­ ing with Papua

––

Customized approach for remote areas, start­ ing with Papua

Joint Papua Customized Working approach Group estab­ discussed, fi­ lished; nalized, and endorsed by Pokja

Implementa­ Delays. tion Review Working of Rural in group is Papua, which expected to led to dvp be estab­ of 6 strate­ lished in the gic plans for first half of future en­ 2013 gagements; New policy for trans­ portation allowance to remote areas; Preparations for working group under way


Window Two | 73

PNPM Urban Supervision and Monitoring Summary Information Status

Closed (extension to December 2014 proposed to the JMC)

Task Team Leader

George Soraya (gsoraya@worldbank.org)

Executing Agency

World Bank

Start Date to Closing Date

27 November 2009 to 31 December 2012

Geographic Coverage

National: 10,924 urban wards in 268 cities/districts (2012)

Approved Budget

US$ 0.8 million

Project Rationale and Overview In 2008, the Urban Poverty Project (UPP) was re–launched as PNPM Urban and scaled up to achieve nation–wide coverage. The project is now implemented in almost 11,000 urban wards across Indonesia. While the project continues to achieve significant successes, the expansion of the project has strained the program’s management and governance frameworks. Issues with the quality of higher level project management, particularly delays in the procurement of consultants, have constrained progress. Capacity across all levels of government and of communities to implement the program remains limited. Special support is also needed to strengthen the Government’s coordination capacity, thereby ensuring the same quality of supervision and implementation in all areas in which the program is implemented. Since 2009, the PSF has provided supervision and monitoring support to the implementing agency, the Directorate General of Human Settlements (DGHS) in the Ministry of Public Works (MPW ). DGHS and the PSF have prioritized five areas that need to be strengthened: (a) project governance; (b) monitoring and evaluation (M&E); (c) Management Information Systems (MIS) systems, including complaints handling; (d) PNPM Urban special programs, particularly the Neighborhood Development (ND) scheme and Poverty Alleviation Partnership Grant (PAPG); and (e) overall capacity building support. Just as importantly, this project provides special advice to

facilitate the synchronization of various urban poverty programs under PNPM Urban and to support further innovation and development under that program.

Progress in 2012 In 2012, the PSF continued to provide hands–on implementation and institutional support to PNPM Urban. Two formal supervision missions were conducted to review implementation progress of PNPM Urban and associated special programs. These missions also reviewed the quality of project governance at all levels. The missions noted that several guidelines, training modules and standard operating procedures had been revised to enhance capacity building and project implementation, incorporating the findings and recommendations from PNPM Urban studies and evaluations. Capacity building at the community level, however, continued to require further improvements to increase communities’ understanding of and participation in the program. The missions also found that the program suffers from significant pressure to disburse funds due to the targets set at the national level in the state budget (APBN). This pressure to disburse should be accompanied by a system that would allow for community preparation to take place at its own organic pace. The missions also found a number of weaknesses in bidding processes, particularly in terms of the quality of documentation. Even though studies continue to show high levels of accountability in the project, continuous improvements to the MIS, the Complaint Handling System (CHS) and verification of payments made to firms are needed. The PSF continued to provide technical assistance to support improvements to the program’s MIS and CHS, including for the MIS evaluation.11 The PSF also supported the design of terms of reference and completion of draft reports for the quantitative and qualitative evaluation of the Urban Poverty Projects (UPP2 and UPP3). A series of meetings were also organized with the project management unit (PMU) and local governments to follow–up on the findings and recommendations from the PNPM Urban process evaluation.

11 Time Series Glossary and Reports at all levels (sub–district/city/provincial/ National); (b) Project series report, also at all levels, and (c) development of sub–district profiles.


74 | 2012 PSF PROGRESS REPORT

The 2012 Government–prepared audits of PNPM Urban highlighted internal control weaknesses related to the control environment, risk assessment, control activities, information and communication, and monitoring. To address some of these issues, the PSF team continued to provide extensive technical inputs to MPW on key implementation documents, including: facilitator training modules; standard operating procedures for community trainings, housing construction, and social activities; the Neighborhood Development (ND) technical guidelines and more detailed guidelines on the ND project cycle and community mapping. The project is also supporting collaborative initiatives with local governments to improve RLF performance.

Future Plans The Government has decided to continue PNPM Urban in 10,924 urban wards in 268 cities/districts in the period from 2012 to 2015. The PSF has proposed an additional allocation to this project to the PSF’s Joint Management Committee to extend the implementation support over the same period. This proposal is currently being reviewed. As explained above, despite good progress in key areas, a number of challenges remain to improve program design and effectiveness, to consolidate its governance arrangements, and to institutionalize program mechanisms at the local level. In Merapi–affected areas, the implementation support should be continued until the closing of the PSF–financed Disaster Management Support project in December 2013. Support should be focused on assisting the completion of additional housing funded by the PSF and the National Board for Disaster Management (BNPB) domestic funding, using the model developed by the Community–Based Settlements Rehabilitation and Reconstruction (Rekompak) project model, and the development of institutional arrangements for a nationwide application of the post–disaster settlement reconstruction in collaboration with PNPM regular programs. The adoption of the Rekompak–PSF model by BNPB is a major step to ensure the sustainability of the use of community–driven development in disaster recovery.

Lessons learned While the MIS is robust, it could produce more meaningful data for evaluation purposes, especially for the local government and community. A key improvement would be to automatically generate data on the achievement of all key performance indicators. Many of key indicators have already been simplified for PNPM Urban 2012–2015 and are expected to track results, provide feedback to PNPM stakeholders in a timely manner, and capture citizens’ views on PNPM. The CHS system is overwhelmed and needs to be improved to facilitate the prioritization of cases: The current CHS has successfully captured a large numbers of complaints. The CHS has been widely used by management to improve the quality of implementation, particularly the performance of consultants and facilitators. However, the system has been overloaded with more than 60,000 complaints over the last few years. Data needs to be organized to allow for case prioritization. The capacity to resolve complaints also needs to be enhanced by involving the local governments. The project management unit also needs to enhance its own capacity to review and analyze CHS data in order to identify risk trends, possible problem areas in the program, trends in enforcement, etc. A consultation platform involving all stakeholders plays a critically important role in disaster–affected areas: In Merapi–affected areas, one of the key lessons learned has been the importance of establishing a consultation platform where central, provincial and local governments, community and affected people could discuss and solve various options for relocation, which involve complex issues related to land tenure and scarcity. The development of various discussion forums (formal and informal) has fostered innovation and allowed for the generation of practical solutions on the ground. Such a platform has enabled the transfer of land owned by traditional authorities to the community and facilitated the establishment of new settlements.


Window Two | 75

Key Results Targets Result Indicators

Baseline

Total Target

Before 2011 2011 2012

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To ensure full supervisory coverage of Urban PNPM programs and provide special advice for the synchronization of various urban poverty program with PNPM and further innovation and development under PNPM Urban. Reliable MIS

80% of data are complete

90% of data are complete

80%

80%

85%

90%

+5%

N/A

95% of complaints are resolved

90%

95%

95%

98%

+3%

Support the capacity building of MPW and community institutions in program management, planning, fiduciary, and oversight

0

7 manuals developed with PSF input

5

2

7

On target

Strengthened field supervision

50

75 sub–districts visited per year

50

75

97

+22

Increased # of joint supervision mission for high risk areas and eastern Indonesia

0

2 joint missions per year

2

2

2

On target

More interactive websites, with an increased number of visitors

3,000 visitors/hits per day

5000 visitors/hit per day

4000

4000

4,500

9,700

+5,200

Improved collaboration with local governments, based on existing good practices

0

3 local government initiatives

1

2

+1

Improvements in the quality of evaluations and implementations of key recommendations from the recent PNPM Urban process evaluation

0

# of experts recruited to support MPW [no target set]

n/a

n/a

n/a

3

n/a

0

Number of studies disseminated through workshops

n/a

n/a

2

1

Urban poverty study will be disseminated in early 2013

Maintain reliable complaint resolution


76 | 2012 PSF PROGRESS REPORT

Field Operations and Governance and Fiduciary Support Summary Information Status

Active

Task Team Leader

Sentot S. Satria (ssatria@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

1 March 2011 to 31 December 2013

Geographic Coverage

32 provinces, 393 districts, 5,022 sub–districts

Approved Budget

US$ 2.5 million

Project Rationale and Overview The massive scale–up of PNPM as a mainstream, nationwide program has increased the need for oversight and action by multiple stakeholders, while at the same time placing significant strain on the program’s management and governance frameworks. In order to address this, the PSF provides support to the Government to strengthen systems to manage and oversee PNPM core and special programs. Under the PSF, a number of trust funds and teams contribute to achieving this objective. A dedicated team of field analysts was established in January 2010 to provide portfolio–wide implementation assistance and to engage with local–level project stakeholders. Its field–level analyses are aggregated to assist bodies responsible for the oversight of PNPM, implementing agencies, and development partners to identify areas that require strengthening and opportunities for pilot development. The field team works closely with the PSF’s governance and fiduciary team, who routinely assess the effectiveness of PNPM’s formal and informal controls; support the Government in resolving complaints and corruption cases; and produce in–depth analyses on the program’s governance framework as inputs for ongoing improvements. Both teams coordinate their work with the PNPM Rural implementation support team, which provides national–level oversight, conducts thematic

reviews and engages in higher level policy dialogue with PNPM Rural’s implementing agency, the Directorate General of Village and Community Empowerment (PMD). The project also provides field–level support to implement numerous thematic reviews led by other PSF teams on aspects of fundamental importance to the program’s performance, with these thematic reviews covering issues such as local government integration, quality of infrastructure, and revolving loan funds. The supervision and review findings are analyzed together with program stakeholders and translated into action plans, which may be accompanied by the provision of further technical assistance and implementation support. The wealth of field knowledge generated through day–to–day interactions with local program stakeholders played a pivotal role in the definition of five priority areas for reform for PNPM Rural (See PNPM Rural Implementation Support report) and intensive follow–up of the agreed deliverables under each of those.

Progress in 2012 The field team visited 241 districts and 445 sub–districts in 2012 alone, bringing the total number of areas visited at least once since 2010 to 409 districts and 758 sub–districts. The selection of locations continued to be prioritized on the basis of established risk factors, such as high disbursement, multiple block grants, high turn–over, remote areas, etc. The team also contributed to a number of important thematic reviews, the results of which served as inputs for the preparations for PNPM Rural 2012–2015, the PNPM Roadmap and other projects. These reviews included a technical evaluation of the quality of sub–projects in 16 provinces; a community–level governance review in 12 provinces; and a review of the revolving loan fund (RLF) in 23 provinces. The findings of the field team and associated recommendations were presented to program stakeholders for analysis and translation into action plans. This approach appears to be paying off in terms of the development of corrective actions to strengthen the fiduciary controls and project management; of


Window Two | 77

increasing disbursements; of improving the quality of infrastructure sub–projects; and of strengthening complaints handling. The field team debriefed and discussed systemic issues with Government counterparts every first week of the month. These discussions contributed to a number of reforms, including design improvements to PNPM’s RLF component for PNPM 2012–2015 and revisions to the standard operating procedures for internal auditing, invoicing and problematic locations.

409 districts

758

32

97%

In 2013, the project will seek to maintain its current level of coverage, both in terms of the range of programs and of geographical areas visited. As in previous years, the team’s work plan will be negotiated with PNPM’s implementing agencies and PSF task teams, with adjustments to reflect their evolving priorities and needs. Some of the activities that have already been identified for next year, beyond the routine field–level supervision and ongoing dialogue with national and sub–national stakeholders, include: (a) stocktaking on integration of

sub–districts

provinces Figure 17. Number of PNPM and associated programs supported12 of Indonesia’s provinces covered

Future Plans

Figure 18. Number of joint missions with and corrective actions delivered by local governments

81%

of Indonesia’s districts visited

12%

14

of Indonesia’s sub–districts visited

47 40

9 6

327 16

283

109 2010

2011

2012

2010

2011

2012

Number of joint missions/year Number of corrective actions delivered by local governments/Year

12 PNPM Rural, PNPM Green, PNPM Generasi, PNPM Peduli, PNPM Integrasi, PNPM Post Crisis, PNPM Post Disaster, Prime, PEKKA, PAWE Papua, PNPM Agriculture IFAD Papua, PNPM Respek Papua, PNPM BKPG Aceh, Consolidating Peaceful Development in Aceh Program.


78 | 2012 PSF PROGRESS REPORT

The field team visited 241 districts and 445 sub–districts in 2012 , including a significant number of remote locations, accessible only by motorbike, foot or boat.

planning processes and facilitation at the field level; (b) end–of–year mission on financial management and fiduciary controls; (c) financial management review for the entire PSF portfolio; (d) thematic missions on RLF, Governance and MIS; (e) review of the administrative service consultant firms’ performance; (f ) and technical assistance to PMD.

Lessons learned Key lessons are : (a) It is necessary to build awareness of the importance of complaints handling and anti–corruption among all project stakeholders; (b) It is necessary to document and disseminate experiences and good practices across the program amongst both facilitators/officials and communities through training modules and communication materials and media; (c) The complaints handling mechanism should be integrated into the existing local community context/village structure; (d) Experiences in resolving complaints should

be codified so that they can serve as lessons learned for the future. Documentation on best practices should be made public; (e) A web–based complaints handling system is the best choice since it can manage data and provide information promptly and involve the public in monitoring how complaints are resolved; (f ) Developing an understanding of the social relationships and dynamics of the local community or area is extremely important. Accordingly, the complaint–handling mechanism should be customized to adapt to each local context.


Window Two | 79

KeY RESULTS

Result Indicators

Baseline

Total Target

Targets 2011

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To respond to the increased need for oversight and action by multiple stakeholders under a scaled up program, while building government capacity to undertake integrated, risk–based supervision in support of its priority objectives # of corrective actions delivered by local governments

––

# of provinces, districts, sub– district visited at least once each year

––

# of joint supervision missions involving National and Local Governments

1,000

300

600

800

1,000

719

+119

32

32

32

32

32

32

On target

150

150

150

150

150

241

+91

300

300

300

300

300

445

+145

––

170

50

90

130

170

87

–3

# of thematic reviews

––

12

4

7

10

12

9

+2

# and type of SOPs/Guideline revised with inputs from field supervision

––

22

10

14

18

22

14

On target

GoI web–based complaints handling overhauled

––

Functional by January 2013

Redesign

Up & Maintenance Maintenance CHS running functional

On target


80 | 2012 PSF PROGRESS REPORT

Technical Assistance to BAPPENAS and the PNPM Steering Committee (Pokja Pengendali) Summary Information Status

Active

Task Team Leader

Sentot S. Satria (ssatria@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

21 September 2011 to 31 December 2013

Geographic Coverage

National

Approved Budget

US$1.7 million

Activity Rationale and Overview The PNPM Mandiri program has grown out of a small pilot study that involved 25 villages into Indonesia’s flagship poverty alleviation and community empowerment program that involves over 70,000 villages and urban wards in every sub–district in the country. This scale–up has created special challenges for the Government agencies responsible for managing the program. The Steering Committee of PNPM (Pokja Pengendali), which is responsible for the overall management and implementation of PNPM Mandiri, and the National Development Planning Agency (BAPPENAS), which serves as the Chair of the PSF, are critical to the success of the program. To support the daily operations of Pokja Pengendali, a Secretariat has been established under the coordination of the Deputy Minister for the Coordination of Poverty Reduction. This Secretariat conducts analysis and provides administrative and technical services to support Pokja Pengendali. Its responsibilities include: (a) the formulation of policy recommendations; (b) the coordination of one–door planning; (c) the monitoring and oversight of PNPM throughout its project cycle; (d) the preparation of reports related to PNPM for cabinet meetings, ministerial–level meetings, and the public; (e) the supervision of line ministries’ integration of community–driven development; (f ) the coordination of complaints handling with line

agencies, executive staff, and enforcement agencies; and (g) public campaigns and socialization. BAPPENAS is responsible for the planning and direction of PNPM Mandiri. The PSF provides support to Pokja Pengendali to enable it to perform its functions and tasks in the coordination of policy implementation, planning, supervision, oversight and in increasing the awareness of the public and local stakeholders regarding PNPM Mandiri. Given the special role of BAPPENAS in the planning, monitoring and evaluation of PNPM Mandiri, the PSF also provides specific support for BAPPENAS, including the provision of technical staff and training to improve the quality of planning, budgeting, monitoring and evaluation process for poverty reduction policy and programs.

Progress in 2012 Pokja Pengendali carried out and supported many activities in 2012, including: (a) leading the preparation of the PNPM Roadmap; (b) facilitating the appraisal and finalization of the PNPM Rural 2012–2015 project; (c) preparing the PNPM village integration guidelines to improve participatory planning at the village level across PNPM programs; (d) supervising work associated with improving the revolving loan fund (RLF) component of the PNPM Rural and Urban programs; (e) signing a Memorandum of Understanding with Bank Rakyat Indonesia (BRI) to improve the capacity of the RLF and to empower more PNPM beneficiaries to expand their businesses; (f ) redesigning the PNPM Mandiri official website and adding new features; (g) improving social media and social network (Facebook, Twitter, blogging) for communicating information related to PNPM Mandiri; (h) supporting good governance and building partnerships (e.g., with the Corruption Eradication Commission/KPK and the Development and Finance Surveillance Agency/BPKP) to strengthen the prevention, control, and handling of corruption within the PNPM Mandiri; and (i) strengthening the overall monitoring and evaluation systems of PNPM Mandiri programs. Pokja Pengendali also organized the 2012 PNPM National Congress, which was held in Jakarta on 4–5 December, and which was a culmination of a series of national consultation activities related to the finalization of the Roadmap, which took place in Jakarta, Surabaya, Denpasar and Makassar.


Window Two | 81

Future Plans

can be used for technical learning as well as to inspire stakeholders regarding what PNPM Mandiri can deliver; (f ) strengthening partnerships with local government and the private sector to achieve more poverty reduction; and (g) continuing support to BAPPENAS and to the Deputy to the Minister for Poverty Alleviation and Community Empowerment under the Coordinating Ministry for People’s Welfare.

In 2013, the project will focus on: (a) supporting the PNPM Roadmap and its action plan; (b) continuing RLF supervsion and sharing and replicating best practices through the BRI partnership; (c) strengthening of socio–cultural aspects through pilot activities; (d) sharpening the results of monitoring activities; (e) writing best practices implementation stories, which

Key Results

Result Indicators

Total Baseline Target

Targets 2011

2012

2013

Cumulative Progress as of Dec 2014 31, 2012

Difference with cumulative target for 2012

PDO: To provide support to BAPPENAS for improving the quality of planning, budgeting, monitoring and evaluation process of poverty reduction policy and programs Number of analysts providing technical assistance

0

2

2

2

3

n/a

2

0

Number of staff trained in the formulation of poverty reduction policies and programs

0

3 to 4

n/a

3 to 4

n/a

n/a

1

(2–3)

Number of staff attending seminars/ workshops on the planning/monitoring of poverty programs

0

2 to 3

n/a

0

2 to 3

n/a

0

n/a

PDO: To provide support to Pokja Pengendali in the aspects of coordination, management and oversight of PNPM Mandiri. # of policy notes prepared

0

2

3

6

n/a

n/a

9

Plus 3

# of Districts/Cities that socialized with cost sharing policy

0

497

497

n/a

n/a

n/a

497

On target

# of stakeholders that consulted for PNPM Roadmap

0

125

0

125

n/a

n/a

125

On target

# of participants in National Congress of PNPM Mandiri

0

n/a

250

600

n/a

n/a

600

On target


82 | 2012 PSF PROGRESS REPORT

PNPM Communications Summary Infotrmation Status

Active

Task Team Leader

Natasha Hayward (nhayward@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

13 June 2008 to 31 December 2013

Geographic Coverage

National

Approved Budget

US$4.35 million

Project Rationale and Overview PNPM is an evolving and innovative program that requires an intensive communications process if members of the community, press, government officials, academics, activists, development sector workers and other key stakeholders and actors are to become aware of the program’s development and supportive of efforts to implement its activities. The Communications program promotes awareness of PNPM and facilitates knowledge sharing among all PNPM stakeholders by helping PNPM stakeholders to codify, organize and share their knowledge through innovative tools and approaches and by developing accountability mechanisms to allow the community and public to have a stronger voice and greater ability to hold the program’s actors accountable. Strengthening the PNPM’s communication and learning platform is important for several reasons. First, as the program has become larger and more complex, providing strategic, accessible information related to PNPM programs is essential to respond to the rising demand for information from different audiences at all levels. Second, the provision of such information raises awareness regarding the program, ensuring transparency and accountability and addressing misperceptions regarding the program. Third, the PNPM platform generates a vast amount of data and knowledge that is not only useful for monitoring program progress, but also as inputs for policymaking and the design of programs to accelerate poverty reduction. Since 2008, the PNPM Communications program has been providing support to the Government to disseminate information on the various PNPM programs through various media; to monitor news coverage;

to proactively engage media organizations, including through the organization of field visits; to document lessons learned and best practices and to support learning events; to work with CSOs to promote transparency and accountability; and to facilitate South–to–South exchanges with countries interested in learning from PNPM as part of the G20 initiative. Beyond making information and data related to Indonesia’s Cluster 2 programs readily available to members of the public, office bearers, and other stakeholders, the communications program also seeks to stimulate in–depth analysis and public debate on the data and findings related to social development issues in Indonesia generated through the PNPM program. Efforts are already underway to more systematically organize analytical findings and to establish more effective avenues to discuss and propagate them.

Progress in 2012 Over the years, the Communications team has increased its emphasis on learning and knowledge sharing. It has also increasingly utilized information and communications technologies (ICT ) to expand the impact of communications and learning activities. Reflecting this emphasis, key activities in 2012 included the following: Asia Knowledge and Innovation Lab (AKIL). The PSF facilitated this ongoing exchange on ICT in Indonesia between Indonesia and Africa experts. The group of experts met in Jakarta to evaluate existing opportunities to strengthen development programs and activities through the use of ICTs. The meeting identified a number of entry points, which led to the drafting of an engagement strategy of key actors and policymakers. Internship program with Indonesian Universities: The PSF initiated an internship program to increase awareness among and build the capacity of young Indonesians to become involved in the country’s community empowerment and poverty reduction efforts. Through this program, 35 interns were selected and placed with PSF teams. Learning and knowledge sharing events: The PSF supported the organization of a number of events, including: (a) the 2012 PNPM National Congress; (b) the Strategic Evaluation Workshop, at which more than 70 PNPM actors came together to discuss the findings from various PNPM evaluations and studies; and (c) the National Story Competition, which included a special


Window Two | 83

The PNPM Communication team organizes quarterly field visits for the media since 2008 to increase their understanding of how PNPM works and to promote good practices. program for Papua. The competition generated hundreds of submissions related to local level development issues and other matters from members of local communities in Papua and elsewhere in Indonesia. These stories will be disseminated in early 2013. Jalin Suara (voice intertwine): The PSF began work with the Government to develop a platform that enhances access to and exposure of information related to socio–economic and local governance conditions in community–driven development (CDD) project locations to better monitor development impact. Government stakeholders and PNPM teams have agreed to create an operational prototype and the necessary training and assimilation strategy for platform users. South–to–South knowledge exchanges: Throughout the year, the PSF supported exchanges with visits from delegations from Afghanistan, Mongolia, Kenya, Haiti and India. To support such exchanges of knowledge, PNPM was asked to take part in a pilot initiative to assist World Bank staff and clients to create a knowledge base related to PNPM programs as a means of facilitating access to this knowledge from overseas development actors interested in these programs. In July 2012, more than 70 visitors from 40 countries participated in a high–level conference entitled ‘Towards Country–led Knowledge Hubs’. Held in

Bali, this event was co–organized by the Government, the World Bank, the Japan International Cooperation Agency (JICA) and the United Nations Development Programme (UNDP). DISKUSI Community Radio Program: The PSF continued to partner with Combine Resource Insitutions (CRI) to implement DISKUSI, a community radio program designed to enhance transparency and accountability within PNPM Mandiri. This program involved more than 150 community radio stations in 15 provinces.

Future Plans The Communications program will continue the community radio (DISKUSI) program, which will expand significantly and be supported by the Ministry of Communication and Information (Menkominfo). The program will also focus on supporting the establishment of social accountability loops that facilitate beneficiaries’ access to reliable and digestible information related to PNPM and enable these beneficiaries to provide feedback and to check that this feedback is acted upon. This will involve an assessment of current accountability activities and the provision of support for communications and knowledge management systems to further expand the team’s media outreach activities; to develop and


84 | 2012 PSF PROGRESS REPORT

strengthen Government and PSF online platforms and applications; and to leverage Indonesia’s status as a global leading user in social media. The team will continue to engage the ICT developer community to develop PNPM program application solutions, particularly mobile solutions. The election period will increase the risk of political interference in PNPM. To mitigate this risk, the communications team will continue to develop materials and campaigns to reinforce PNPM’s positioning as a non–political, pro–poor program.

Lessons learned As the world’s largest CDD Program, PNPM can provide useful lessons and insights to other countries: The communications program is helping to utilize this learning to improve future knowledge exchanges, focusing on facilitating effective two–way learning and developing a community of practice that links members of the visiting delegations, thereby ensuring the sustainability of this learning platform. The prominence of these knowledge exchanges has grown recently with Indonesia assuming the role of a co–chair of the G20 initiative on South–to–South Knowledge Exchange. Government officials involved in PNPM have also benefitted from opportunities to expand their knowledge through visits to other countries with experience with CDD projects. Knowledge is developed not just through analytical studies or formal progress reports, but through the accumulation of good practices developed through experience in the field: A culture of learning by doing and experimentation has been central to PNPM’s ongoing success in Indonesia’s evolving environment. While a wealth of information has already been made available and accessible to stakeholders, knowledge acquired through the accumulation of good practices has not yet been systematically and formally managed and shared. This limits the effective uptake and mainstreaming of innovative practices by development actors at various levels. The communications program has already begun organizing this wealth of knowledge through new websites and an online library, the development of which is a first step towards the establishment of a ‘one–stop shop’ for information. A number of pilot initiatives are also being prepared to foster systematic knowledge sharing through new and existing tools such as interactive mapping, Geographic Information Systems (GIS), and SMS gateways.

ICT can complement existing ways to engage with civil society and members of the community, creating new avenues to facilitate citizen feedback, enabling communication in new social contexts, and giving voice to a greater proportion of the population: Recent innovations in ICT, including a higher level of access to the internet and mobile phones, create new opportunities for engagement and dialogue with civil society and members of the community. It is envisioned that the communications team will develop a pilot initiative in locations to enable members of the community, CSOs and other stakeholders to access information related to PNPM projects and to provide feedback related to project results. This platform will allow program stakeholders to crowd–source information and to facilitate consultations regarding projects, their impact and results.

The PSF Communications project produces a number of summaries of studies and other materials to foster a wider understanding of how the PNPM program works.


Window Two | 85

Key Results

Result Indicators

Baseline

Total Target

Targets 2011

2012

2013

2014

2015

Difference with Progress as cumulative of Dec 31, target for 2012 2012

Development Objective: To strengthen PNPM’s overarching communications, social accountability and learning platform which supports continuous program improvements through information dissemination, development of social accountability mechanism, capacity–building and enhanced knowledge sharing among all PNPM stakeholders Media or­ ganizations participat­ ing in field visits

23 media or­ ganizations

30 media organiza­ tions

25

28

Commu­ 149 in 9 prov­ nity media inces engaged in information dissemi­ nation & commu­ nity–driven monitoring

175 in 15 provinces

Partner­ ships with CSOs, Academia & interest groups

4 active part­ nerships

12 active partner­ ships

4

National Internship Program

N/A

20 interns from 5 Uni­ versities

N/A

High profile learning events/ workshops

3 annually

5 annually

3

3

Visits/study tours from foreign del­ egation

4 annually

5 annually + Govern­ ment visits to foreign countries

4

PSF website & online Library functional

N/A

Average of 7,000 visi­ tors each month to PSF web­ sites

Community uses online mechanism & other social tools to provide feedback on PNPM

N/A

30

30

30

30

28/year

On target

175 in 15 provinces

175 in 15 provinces

150 in 12 provinces

On target

12

12

8

On target

Same

Same

20 interns from 5 Uni­ versities

On target

5

5

5

3 annually

On target

5

5

5 Gov­ ernment visits start

5

5 annually

On target

N/A

4,000

5,000

6,000

7,000

4,381 (new PSF site up & running and linked to Library & GOI sites)

+381

N/A

Under dvp

Testing

600

1,500

Same

On track

149 in 9 150 in 12 160 in 12 provinces provinces provinces

8

10

Selection 20 interns process from 5 finalized Universi­ ties


86 | 2012 PSF PROGRESS REPORT

PSF Secretariat Summary Information Status

Active

Task Team Leader

Kevin Tomlinson (ktomlinson@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

31 January 2008 to 31 December 2014

Geographic Coverage

National

Approved Budget

US$ 9.6 million

Project Rationale and Overview The PSF Secretariat provides operational and administrative services to the PSF to sustain an effective framework for the implementation of PNPM Mandiri. In addition to supporting the management of the PSF and to coordinating the Joint Management Committee (JMC), the Secretariat provides fiduciary oversight and reporting for all PSF programs and support for the Technical Secretariat. Specific activities undertaken by the Secretariat include: administering grant agreements issued through the PSF Trust Fund; coordinating program supervision missions and appraisals; providing operational and technical assistance to national, provincial and district level agencies managing PNPM Mandiri programs; preparing financial reports and quarterly and annual progress reports; and documenting and disseminating minutes of JMC meetings.

Since it was established in 2008, the PSF has passed through a steep learning curve and gone through three distinct phases. During the first period (July 2008— October 2009), the PSF provided a mechanism for the Government and donors to discuss the operational and managerial challenges associated with the massive scale–up of PNPM to national coverage. The World Bank, as trustee, focused on establishing the facility and on the launch of pilot activities. During the second period (July 2008—October 2009), the PSF focused on the implementation of the initial portfolio, the processing of new proposals, and the mobilization of additional donor funding. During this period, progress was constrained by an extended leadership transition and slow disbursements. During the third and ongoing period (November 2010—present), a focus on client engagement and internal reorganization has enabled the PSF to quadruple the resources available to the Government and to address some of the challenges associated with the management of such a high–profile portfolio. To manage such rapid growth and to ensure a high level of quality and accountability, the Secretariat has progressively reinforced the PSF’s performance management systems and internal controls, with some positive results: zz Most projects have performed satisfactorily against their performance targets; zz Disbursement levels have also been satisfactory. PSF financed activities and projects disbursed US$86 million in 2011 alone; zz Quarterly progress reports and semi–annual,

Figure 19. Donor contributions 2008–2012 (US$ million)

259 207

131

23 2008

41

2009

2010

2011

2012


Window Two | 87

Key Findings of the Independent PSF Progress Review Key findings of the independent PSF progress review include the following: zz The PSF facilitates a good level of coordination across PNPM–related grants and among development partners; zz The PSF provides effective support for the scaling up of PNPM and for the improvement of associated systems, providing a solid basis for a greater integration of PNPM with regular Government operations. However, the PSF also fulfills a number of functions which might be better conducted by Government and impact negatively on Government ownership and leadership of the program; zz The PSF’s engagement with CSOs creates opportunities for the ongoing development of partnerships. However, there is a need for a higher

zz

in–depth analyses of governance issues in PNPM have been published; The rate at which proposals have been processed has accelerated and the PSF Operations Manual has been revised to clarify and strengthen the policies and procedures that guide the functioning of the facility.

Progress in 2012 In mid–2012, BAPPENAS conducted a review of the PSF to assess its performance and to determine whether, in its current form, it is the appropriate mechanism to support PNPM in the future. The review concluded that, overall, the PSF creates good value for the Government, enabling it to achieve a coordinated approach among development partners; enhancing the Government’s capacity to scale up PNPM; and building capacities in terms of governance and fiduciary systems and processes, analytical work, and the development of innovative pilots. The review proposed two major shifts in emphasis, however. The first of these is for the PSF to support the Government in preparations for the eventual transfer of the trust fund to a national institution. The second involves a cultural shift towards a greater level of ownership and leadership by the Government.

zz

zz

zz

zz

level of support to build relationships between CSOs and the Government; The PSF’s facilitation of high quality analytical work helps develop evidence–based approaches to poverty reduction and community empowerment, which could be enhanced through improvements in monitoring and evaluation systems; Processes are in place to ensure alignment with Government priorities, but there is need for strategic direction; The role of the World Bank as the trustee of the PSF creates additional value that might be enhanced through some changes in processes; The PSF’s governance and management model is appropriate, although it could be strengthened through some minor revisions.

At the strategic level, the JMC reviewed and endorsed an engagement framework for the PSF in September 2012, with this framework being guided by and supportive of the PNPM Roadmap. Engagements are organized around four pillars/strategic priorities: (a) continued poverty impact; (b) improved accountability; (c) social justice and inclusion; and (d) a supportive, enabling environment. The Secretariat and technical teams are now endeavoring to operationalize this strategy to facilitate the prioritization and selection of proposals on an ongoing basis. A proposal for ensuring the ongoing sustainability of the PSF has also been discussed. This proposal will be further developed under the working group’s guidance. Some agreed upon actions are already being implemented, including the strengthening of the Government’s role as the chair of the JMC; the inclusion of the executing agencies in the JMC to foster a greater degree of ownership; the use of specialized audit firms to carry out some implementation support functions; the relocation of PSF teams to facilitate closer relationships with counterparts; intensified involvement of staff from partner organizations (think tanks, CSOs, etc.) through secondments to the PSF; and


88 | 2012 PSF PROGRESS REPORT

Figure 20. Share of funds by executing agencies

7% NGO

20%

WB

73% GOI

measures to facilitate the involvement of highly potential, skilled young Indonesians studying here and abroad in the social development agenda in Indonesia. At a more technical level, to further improve the PSF’s level of efficiency and accountability, the Secretariat is mainstreaming a results–based management system for all projects in the PSF portfolio. Under this system, project progress and financial performance are reported and measured against pre–established targets. Overall, most projects have demonstrated a satisfactory level of performance. The total value of cumulative disbursements reached US$181 million at the end of 2012, with 85 percent of projected annual disbursements for 2012 being realized. The Secretariat is also implementing measures to strengthen the quality enhancement process for new projects, including through the general implementation of international peer reviews for new operations and analytic works. The Secretariat has also facilitated measures to further enhance national ownership of the PSF, with the share of resources executed by the Government and Indonesian CSOs now reaching 80 percent. Besides continued support for the Government’s leadership of the JMC, national partners have been increasingly involved in the definition of the operational and analytical policies of the PSF and their implementation.

The transaction costs associated with the administration of dozens of trust funds continue to be a challenge, however. While development partners, including implementing agencies, appreciate the World Bank governance systems and quality project preparation and implementation support, the ‘hassle factor’ in using World Bank processes and administrative requirements can create delays for the processing of new operations, creating frustrations among implementing partners, particularly NGOs, and taking valuable time away from technical supervision and support to PSF projects.

Future Plans The PSF Secretariat has initiated the processing of the extension of the administration agreements with donor partners in order to implement the JMC’s decision to extend the tenure of the PSF until 2018. To implement the recommendations of the independent PSF Review, the PSF will focus on: zz Supporting the transition of the PSF Trusteeship from the World Bank to the Government; zz Strengthening the governance structures of the PSF by, among other measures, making BAPPENAS the sole chair of the JMC and including representatives of PNPM Mandiri implementing agencies (the Ministry of Home Affairs and the Ministry of Public Works) as members of the JMC;


Window Two | 89

zz

zz

zz

Developing a high–level resource allocation strategy to enable the JMC to more effectively prioritize the allocation of funds. This strategy will be presented to the JMC for elaboration and approval; Hiring of specialized firms to strengthen the implementation support provided by the PSF and to establish stronger linkages with the knowledge sector to facilitate the use of the PSF’s analytical work as an instrument for institutional capacity building; and Finalizing a high–level results framework, with associated performance indicators.

Lessons learned zz

zz

More rigorous upstream Technical Committee ( TC) reviews of project proposals augur well for smoother project preparation and implementation. The JMC should consider establishing a project preparation budget line—to be used on a project–by–project basis—that would allow some limited and preliminary preparation activities to begin after TC endorsement. This would reduce preparation time once the JMC formally approves and better ensure readiness for implementation. While each JMC member receives quarterly financial management reports from the PSF, the PSF’s balance sheet should be included with any new or top up proposals presented for JMC approval.

KeY RESULTS Result Indicators

Baseline

Total Target

Targets 2011 2012 2013 2014 2015

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To provide operational and administrative services to the PSF to sustain an effective framework for the implementation of PNPM Mandiri # of JMC meetings held within the year

2 (2010)

6/year

8

14

20

26

32

10

Minus 4—Holding bi– monthly JMC meetings has been difficult because of scheduling challenges among GoI/ dvp partners.

Contributions (US$)

90m (2010)

n/a

n/a

n/a

n/a

n/a

n/a

259m

New contributions are needed to finance new JMC approved activities.

n/a

n/a

n/a

n/a

n/a

n/a

305

n/a

n/a

n/a

188

271

312

n/a

181

(7)

Approved commitments (US$) Disbursements (US$)

132m (2008–2010) 50m (2010) 90m (2008– 2010) 28m (2010) 36m (2008– 2010)

Disbursement ratio

20% (2009)

70% (each year)

70%

70%

70%

70%

n/a

60% (for 2012)

(10%)

% of funding executed by Government

53% (2010)

75%

60%

75%

75%

75%

75%

73%

(2%)

% of funding executed by NGOs

7% (2010)

10%

5%

7%

10%

10%

10%

7%

On target

# of active projects

15 (2010)

n/a

n/a

n/a

n/a

n/a

n/a

28

n/a


90 | 2012 PSF PROGRESS REPORT

Barefoot Engineers Training 3 Summary Information Status

Active

Task Team Leader

Susanne Holste (sholste@worldbank.org)

Executing Agencies

BaKTI (Bursa Pengetahuan Kawasan Timur Indonesia/ Eastern Indonesia Knowledge Exchange) and PSF

Start Date to Closing Date

25 October 2012 to 31 December 2013

Geographic Coverage

Papua and West Papua

Approved Budget

US$ 1.8 million

Project Rationale and Overview Since 1998, communities in Papua have participated in the Government’s community–based development programs, first in the Kecamatan Development Project (KDP) and, since 2007, in PNPM Rural. In the same year, the local government launched PNPM–RESPEK (Rencana Strategis Pembangunan Kampung/Strategic Village Development Plan), which channels funding directly to the village level. Each year, the program provides Rp 100 million (about US$10,526) to each of the 4,044 villages in the two provinces for: (a) nutrition and food security; (b) education; (c) primary health care; (d) village infrastructure; and (e) economic livelihoods. In 2008, RESPEK was integrated with PNPM Rural. PNPM Rural is one of the few government programs that has been able to engage communities throughout the provinces of Papua and West Papua and has delivered tangible benefits to them. Implementation of PNPM Rural in the Papua region has been particularly challenging due to a number of factors, including: (a) the remoteness of project locations; (b) the extreme cultural and ethnic diversity of the Papuan provinces; and (c) the chronic shortage of qualified facilitators, particularly engineers. The program requires about 560 technical facilitators for the two provinces, but is only able to fill about half of these positions. In previous years, recruits have often come from outside Papua. However, many of these recruits would leave after short periods of time due to the difficult working conditions. In order to address these challenges, in 2003, with donor assistance, the Government designed a special program, the Barefoot Engineers training program. Through this program, qualified applicants based in the Papuan provinces were enrolled in an intensive training course,

combining classroom teaching with the practical application of new knowledge in the field on the most common small–scale infrastructure projects funded by the PNPM program. The previous two phases of the Barefoot Engineers Training program were conducted in 2003 and 2009, producing 334 graduates who were subsequently deployed as technical facilitators in PNPM Rural. While there has not been an ex–post evaluation of the Barefoot Engineers program, consensus among development partners and government stakeholders is that the approach has worked well and that the graduates from the program are effective as technical facilitators. Participants in the program often originate from the districts to which they are deployed and therefore speak local languages and have a good understanding of the local context. Of the 120 graduates from the second wave of the program, 90 percent were indigenous Papuans and 30 percent were women.13 The number of unfilled vacancies for positions as technical facilitators remains a significant issue in Papua and West Papua. To address this, the governments of these provinces requested a new wave of the Barefoot Engineers Training be implemented to train a cohort of 140 new barefoot engineers. Drawing lessons from the field and the previous two phases, which showed that refresher training and mentoring is important, Barefoot Engineers Training 3 incorporated the following elements into its design: zz Two weeks of refresher training for both new graduates and graduates from two previous training waves. The refresher training will be conducted 3–4 months after the deployment of the newly recruited graduates; zz Eight months of mentoring by the trainers team to graduates after their deployment to the field. The trainers’ team will work closely with the provincial PNPM team.

Progress in 2012 The implementer of the project is the Eastern Indonesia Knowledge Exchange (BaKTI), with technical assistance support provided by the Research and Community Dedication Institution—University of Cendrawasih (LPPM–UNCEN). Between July and September 2012,

13 See ‘Evaluation of PNPM Respek: Village Infrastructure and Institutional Capacity’


Conditions in Papua make the deployment and retention of facilitators difficult. The Barefoot Engineers program overcomes this by providing training to qualified members of local communities.


92 | 2012 PSF PROGRESS REPORT

BaKTI established a project team in Jayapura; recruited trainers; and finalized the updating of the training modules. Implementation started in October 2012, with the program aiming to qualify 300 graduates to fill vacant technical facilitator positions. The project benefited from funding by AusAID for preparatory activities, including the updating of the training modules and the recruitment of trainers and participants. Of the selected trainees, 29 percent are women. In September 2012, the first coordination meeting was held in Makassar, with the meeting also being attended by PMD’s Papua and West Papua provincial management staff. The meeting resulted in a full commitment from PMD for the implementation of the training and subsequent recruitment of the successful graduates by PMD. In December 2012, a joint Government, AusAID and PSF supervision mission found that the training is of very good quality and that the trainers and students are enthusiastic.

The trainers have recommended the delivery of additional activities to enhance the quality of the training, including self–awareness and confidence building activities and remedial after–hour classes for students who face difficulties.

Future Plans In January 2013, the Joint Management Committee approved top–up funding of US$2.4 million to enable an increase in the number of trainees from 140 to 300 and to ensure that Barefoot graduates receive mentoring once they are deployed. The pre–service training will be completed in April 2013. Graduates from this phase and from previous phases will participate in two seven–day refresher/in–service training courses to strengthen their core skills as technical facilitators. New graduates will also benefit from intensive coaching and mentoring for eight months to help them

Women attend a basic community health center with their children to obtain post-natal care (Yappen, Papua).


Window Two | 93

settle into their roles and to benefit from a support network when they face the difficulties inherent to working in remote and disadvantaged areas.

training, which provides intensive instruction to high school graduates to become technical facilitators, is an effective means of overcoming this challenge.

Plans are currently being formulated to improve the performance of PNPM Rural by adapting implementation modalities, such as working through churches and NGOs and lengthening the project cycle from one to two years. Crucial to this effort will be better social and technical facilitation. In addition to holding regular trainings for Barefoot Engineers, it is expected that a course might be developed to also improve the training for social facilitators.

Barefoot Engineers are usually young and inexperienced. Thus, they need mentoring once they start working in the communities. They also need to have access to a professional network to provide support and to facilitate discussion. This need should be addressed through the proposed mentoring program. Subsistence and travel cost in Papua are much higher than elsewhere and these will be addressed through revised allowances. These revised allowances have already been endorsed by Pokja Pengendali.

Lessons learned Engineers from other provinces face great difficulties to adapting to working conditions in Papua and there are not sufficient numbers of Papuan engineers available to fill the vacancies. Barefoot engineer

Key Results

Result Indicators

Baseline

Total Target

Targets 2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To provide trained technical facilitators for the PNPM Rural/RESPEK Program in the provinces of Papua and West Papua. Qualified technical facilitators provided by the project to PNPM Rural/RESPEK Program in the provinces of Papua and West Papua

n/a

270 recruits (i.e. 90% of trainees)

0

270

Training runs from 10/2012–4/2013. Graduates will then be recruited by PMD.

On track

Improved quality of small–scale village infrastructure

60% (2012)

65% rated as of sufficient quality

62%

65%

62% (baseline)

Improvements should start materializing in 2013/14.

Participants trained

n/a

300 participants

300

300

Training started in October 2012

On track

Women participants

n/a

30% of women trainees (i.e. 90 total)

30%

30%

29%

–1%

Barefoot graduates participate in a two–week refresher training

n/a

370 graduates receive refresher training

0

370

0

Refresher training is planned for the 2nd quarter of 2013.

Tracer study of BE graduates

n/a

Study Completed

Study starts

Continues

Final report completed

Delayed

Delayed (BaKTI is drafting the ToRs)


94 | 2012 PSF PROGRESS REPORT

Community Facilitators Development Project (CFDP) 3 Summary Information Status

Active

Task Team Leader

Hans Antlov (hantlov@worldbank.org)

Executing Agency

Yayasan Nusantara Sejati—Institute for Good Governance and Regional Development (YNS–IGGRD)

Start Date to Closing Date

9 July 2012 to 31 December 2013

Geographic Coverage

National

Approved Budget

US$ 1.2 million

Project Rationale and Overview There are an estimated 25,000 facilitators deployed throughout PNPM programs. These facilitators play a key role in providing input to improve community plans and in advising village implementation teams and groups engaging in micro–enterprise ventures. The Community Facilitators Development Project (CFDP) 3 supports community–driven poverty reduction by advancing the role of community facilitators as agents of change through certification and training programs. While the state of local governance within the PNPM Rural program is still strong, a decline in the quality of facilitation may be undermining the effectiveness of the program. The latest Governance Review of PNPM Rural notes that facilitators are increasingly absent, poorly trained, lacking in the right skills or motivation, or facing political pressure and attempts at collusion by local government. They also are increasingly overworked at the sub–district, district and provincial levels. The scale–up of PNPM Rural, with its associated rise in the number of areas that facilitators have to cover, and the demands of reporting leave them with less time to focus on their core responsibilities. CFDP 3 was approved by the JMC in 2011 to equip all PNPM facilitators with standard basic competencies by certifying these competencies through a recognized process and by providing continuous professional development. The project seeks to do this by: (a) creating a nationally recognized and professional

certification program; and (b) providing ongoing professional development and refresher training for community facilitators. CDF 3 builds directly on the groundwork laid during previous two phases implemented between 2007 and 2010. These previous phases (a) built consensus on the need for a national facilitator certification system among a range of stakeholders; (b) identified professional and basics competency standards; and (c) provided master training to PNPM staff, who in turn trained 650 participants across Indonesia, preparing them to train facilitators.

Progress in 2012 In 2012, the Community Facilitators Certification Institute (LSP–FPM) was established, with approval from the National Board for Professional Certification (BNSP). Staff were recruited, including the former Director General of PMD under the Ministry of Home Affairs. The LSP–FPM developed the certification process and the materials. In line with BNSP standards, the certification process makes use of four assessment methods: (a) a portfolio review; (b) a written test; (c) face–to–face interview; and (d) simulation. Using this process, LSP–FPM trained 55 assessors and accredited 10 certification centers ( TUK). These assessors will begin to implement the certification process in 2013. The refresher training program for facilitators was designed in collaboration with stakeholders from PNPM Rural, regional universities and the Government. The refresher training program is based on a sustainable knowledge management system designed to facilitate remote access through the use of internet and mobile technologies. Distance learning will be augmented through class–room teaching, on–the–job training, and regular coordination meetings. Due to a number of challenges, the project did not achieve the initial target of certifying 250 facilitators by December 2012. In particular, the development of test materials, assessors’ training and the fulfillment of strict documentation requirements for obtaining a license has proved challenging. TUK also need more time to prepare their internal legal documentation to fulfill the accreditation requirements. Despite these early challenges, the project is expected to achieve its initial targets in 2013.


Window Two | 95

Figure 21. Achievements under CFDP 3

Number of Competency Test Centers Operational TARGET ACHIEVEMENT

Number of Assessors Providing Certification

5 4

TARGET

20

ACHIEVEMENT

55

Number of Facilitators Certified for Basic Competencies TARGET

250

ACHIEVEMENT

0

Future Plans

Lessons learned

With the establishment of a robust certification system in 2012, it is expected that the initial target of certifying at least 3,250 facilitators (and possibly up to 5,000) will be achieved in 2013. Piloting of the certification process, which will identify constraints and challenges to the certification system and enable fine–tuning before roll–out, will be carried out in 2013. Results of the pilot will also be used to assess the state of the certification Complaints Handling System.

Since certification is voluntary for the individual facilitator, incentives need to be developed early. This includes mandating the recruitment of certified facilitators by PNPM implementing agencies and allocating a budget to incentivize the participation of facilitators in the certification program. In order to achieve this, there is a need to ensure that all implementing agencies understand the need for and are fully committed to this measure. Equally important is to ensure that facilitators who have been certified receive adequate remuneration, which should be seen as an investment in community capacity. Budgets must be formulated to enable the provision of this increased remuneration. Pokja Pengendali PNPM will develop and issue new guidelines in 2013 to ensure that certified facilitators receive upgraded salaries, to be included in the 2014 budgets. The association of facilitators should also play an active role in socializing the program.

LSP–FPM will train another batch of assessors to ensure that 3,250 facilitators are certified by the end of 2013. LSP–FPM will facilitate a range of socialization activities, to be conducted in close collaboration with the facilitators’ association before the system is rolled out. As an integral part of the socialization program, the LSP–FPM will develop a comprehensive communication strategy and work plan. The development of training materials is scheduled for completion by early 2013. Following this, the training of PNPM facilitators will commence. Lessons learned from this training will inform the ongoing development of the refresher training scheme for facilitators in 2013.


96 | 2012 PSF PROGRESS REPORT

Key Results Result Indicators Baseline

Total Target

Targets 2011

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To advance the role of community facilitators as agents of change through certification and training programs # of facilitators certified for basic competencies

0

3,250

0

250

3,250

0

(–250)—Certification will start in Q1 2013 after thorough piloting

# of assessors providing certification

0

70

0

20

70

55

35

# of competency test centers operational

0

10

0

5

10

4 (10 TUK trained and the first 4 authorized by LSP)

(–1)

# of operational masters trainers

0

400

0

0

400

0

The training of master trainers will start in 2013

Development of ‘training design’ modules

n/a

Modules developed (number TBC)

0

0

Trainings using new modules delivered

Activities will start in Q1 2013

Accreditation of training centers

n/a

Centers Identified (number TBC)

0

0

Centers identified

Activities will start in Q3 2013


Window Two | 97

Pro–Poor Planning, Budgeting and Monitoring Project (P3BM) Summary Information Status

Being activated

Task Team Leader

Hans Antlov (hantlov@worldbank.org)

Executing Agency

Kemitraan—The Partnership for Governance Reforms

Start Date to Closing Date

1 February 2013 to 31 December 2013, to be extended to 24 months total after PSF extension

Geographic Coverage

National

Approved Budget

US$ 1.7 million

Project Rationale and Overview The Pro–Poor Planning, Budgeting and Monitoring (P3BM) project involves the development of a toolkit or set of tools and instruments that local government officials can use to ensure that local budgets and plans are pro–poor and sensitive to socio–economic inequalities and to track the execution of such plans. The underlying development assumption is that the availability and use of reliable evidence and data can make planning decisions more pro–poor and responsive to local needs. The P3BM was originally designed in 2007–2009 by the Asian Development Bank and the United Nations Development Programme. In 2010, BAPPENAS requested PSF support, under the Local Government Capacity Development (LGCD) project, to rollout and pilot P3BM in local governments. Under LGCD, the P3BM toolkit was used to train 32 national master trainers and 60 provincial master trainers, who in turn

Women receiving cash from a revolving loans fund in Cikeusal, Banten.


A Progressive Pemda uses the P3BM toolkit to improve poverty targeting The P3BM toolkit is not a silver bullet to improve poverty programs but can help make planning more ‘pro–poor’ under the leadership of a progressive district head or head of Bappeda. The district of Serang is located three hours west of Jakarta and is one of the poorest districts in Java. Since 2010, when a progressive head of Bappeda was appointed, the district has been using the P3BM toolkit to prepare its annual development plans. For instance, simple charts have been used to improve the targeting efficiency of development funds, starting with sub–district Musrenbang meetings. This Excel chart was developed by the sub–district heads using the P3BM toolkit and presented during the Musrenbang. As a result the pilot sub–district’s prioritized proposals addressing maternal and neonatal heath (the red section in the middle of the chart indicates that Serang will not meet these MDGs without additional

investments). Similar charts were also used during budget negotiations with the Serang Legislative Council (DPRD). The percentage of the 2013 development budget in Serang that was allocated for MDG targets thus increased from 38 percent to 54 percent. Further, the Serang Government also established an ‘MDG Data Forum’ in 2012 that coordinates the collection of MDG–related poverty data. Through a series of consultations, the Data Forum has cleaned up the MDG data collected from multiple sources, which increased data reliability and helped improve targeting. Taking stock of these achievements, the Province of Banten decided to establish a provincial P3BM Secretariat and Data Forum in 2013 and will encourage all jurisdictions in the province to use the P3BM toolkit for the 2014 budget planning process.


Window Two | 99

trained 213 officials from 29 local governments. P3BM trainings and workshops were conducted in collaboration with PNPM Urban and PNPM Integrasi,14 which resulted in a more integrated approach to local planning practice. In 2011, an independent evaluation in 10 districts where P3BM was piloted showed that P3BM helps local governments better manage poverty data, providing directions for pro–poor planning and improving the quality of planning documents. As a result, P3BM is being scaled up as an individual project to support and strengthen the abilities of local governments throughout Indonesia to prepare and monitor work plans and budgets that are pro–poor and sensitive to socio–economic inequalities.

Progress in 2012 The PSF Joint Management Committee approved the P3BM project in April 2012. While the project was being formally prepared, some activities were carried out under the LCGD project mechanisms. Twenty–five new national–level master trainers were trained and a refresher course was provided for 32 master trainers originally trained in 2008–2010. P3BM training was rolled out in the provinces of Papua, West Papua, Gorontalo and Bangka–Belitung and in the districts of Lombok Tengah, Lebak, Pagar Alam, Kubu Raya, Depok, Cilegon and Serang. Based on assessments and experience from the LGCD projects, P3BM’s design was enhanced to better monitor local government expenditures and to provide incentives for developing plans more aligned with MDG targets.

Future Plans P3BM is expected to be formally launched in early 2013 and to be rolled out to an additional 20 local governments. P3BM will scale up the master trainers’ program and intensive training, and technical assistance will be provided to district governments. P3BM will aim to set up 15 joint secretariats, which would consist of a master trainer and a small secretariat at the provincial level.

14 PNPM Integrasi is an initiative that aims to integrate PNPM’s participatory development planning into regular development planning and align political technocratic planning with participatory planning. It provides block grants at the district level for kecamatan–level projects generated through the PNPM Rural and Musrenbang participatory planning process.

Lessons learned P3BM needs to focus more on monitoring the quality of expenditures and the accountability of service providers, rather than just on planning and planned expenditure: To date, the program has been heavily focused on planning, and is not linked to implementation. This has limited the impact of the toolkit, since there is a discrepancy between planning, budgeting and actual service delivery. Involving district heads and members of the local councils in P3BM helps get buy in. Similarly, involving sub–district heads in sub–district training facilitates the collection of more comprehensive poverty data and supports the harmonization of data from village to sub–district level. The involvement of sub–district heads is also useful to support the integration of participatory planning with regular planning.


100 | 2012 PSF PROGRESS REPORT

Key Results

Targets Result Indicators

Baseline

Total Target

2012

2013

2014

2015

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To improve poverty targeting of local government expenditures and local government responsiveness to community needs through the scale–up and institutionalization of the P3BM program. # of local governments that have adopted poverty targeting in annual development planning

11(2012)

71 Local Governments

11

31

71

11 LGs adopted P3BM in 2012 under LGCD Phase 1—60 ‘additional LGs’ planned under this project

Increased percentage of direct LG budgets allocated for MDG targeting and poverty–related spending

Baseline survey in early 2013

Plus 7.5% ( TBC)

n/a

5%

7.50%

# master trainers trained

92 (2012)

372 trainees

92

232

372

92 trainees under LGCD, 280 additional planned under this project

# of P3BM provincial clinics established

2 (2012)

17clinics

2

12

17

2 clinics established under LGCD, 15 additional planned under this project

0

60 CSOs

0

30

60

# of CSOs and community groups that use P3BM instruments to track district pro– poor expenditures

Increases should start materializing in 2013.

Activities to begin in 2013


Window Two | 101

SIMPADU 2 Summary Information Status

Active

Task Team Leader

Susanne Holste (sholste@worldbank.org)

Executing Agency

BAPPENAS

Start Date to Closing Date

13 May 2011 to 31 December 2013

Geographic Coverage

Jakarta and 13 targeted provinces

Approved Budget

US$ 1 million

Project Rationale and Overview Indonesian policymakers need access to reliable data related to Indonesia’s community empowerment and poverty alleviation programs if they are to formulate, revise and implement such programs efficiently and effectively. The PNPM Integrated Management Information System (SIMPADU) was first launched by the Minister of National Development Planning and the Head of the National Development Planning Agency (BAPPENAS) in August 2009. The system was designed to manage data related to the implementation of PNPM Mandiri to enable government institutions (national and provincial) to more effectively monitor and plan community empowerment and poverty reduction programs. To support PNPM’s social accountability agenda, the data is accessible to the program’s stakeholders and the general public through a website (http://simpadu–pnpm.BAPPENAS. go.id/). The primary objective of SIMPADU 2 is to improve the system’s ability to facilitate access to information related to Indonesia’s poverty alleviation and community empowerment programs. To achieve this, the project is analyzing the existing PNPM Management Information Systems (MIS). On the basis of this analysis, the project will design, install, and help operate a new integrated MIS for all of PNPM Mandiri’s programs. Currently being piloted in five provinces, the project focuses on improving data collection and analytical capabilities (including developing an MIS Roadmap with detailed integration plans) at national and local government institutions and on integrating data from the PNPM program with local governments’ own data to facilitate knowledge transfer and to develop technical expertise within local

governments. The project recognizes that the accuracy of data made available through SIMPADU depends on the quality of data received from PNPM programs’ MIS and that the quality of this data is at present highly variable. It is expected that SIMPADU will benefit from the ongoing redesign of PNPM Rural’s MIS, the purpose of which is to ensure that the project has a reliable system to facilitate data transfer from the sub–district to the national level and that data is validated systematically.

Progress in 2012 In 2012, the project continued to work on systems integration. By the end of the year, SIMPADU was receiving data directly from thirteen PNPM core and special programs.15 The team of MIS experts used a business intelligence application, which is based on a concept of pre–defined, free–defined, and user–defined data and which provides a user–friendly interface to facilitate data gathering. The project facilitated the redesign of SIMPADU’s database engine and the development of new features related to monitoring and analysis tools. SIMPADU bulk data is not yet openly available, but can now be used to generate output in the forms of tables, maps, or graphs that present information in an accessible manner. The development of SIMPADU at the provincial level began in 2012. Activities to socialize the project’s objectives were conducted in the five pilot provinces. However, socialization efforts took considerably more time than expected. As a result, the development of the provincial systems has had to be postponed to 2013. BAPPENAS requested and obtained a twelve–month extension of the project to December 2013.

Future Plans The number of pilot provinces will be increased to 13. Data from the 13 PNPM programs covered by SIMPADU will continue to be uploaded on an ongoing basis and the servers will be upgraded. The MIS Roadmap will be completed. The project will create an export–transfer–load application for PNPM special programs which are not yet integrated into the SIMPADU system and ensure automatic loading from the various PNPM databases into SIMPADU systems.

15 Rural, Urban, SPADA, RIS, RISE, Generasi, Green, PAKET, ND, INTEGRASI, Border areas, Tourism and Agriculture.


102 | 2012 PSF PROGRESS REPORT

Lessons learned It would have been better to have had prior agreement by all PNPM stakeholders on the MIS Roadmap and minimum standards for individual MIS systems before proceeding with an integrated data collection system. This project was designed to consolidate data and create a database for all PNPM core programs and special programs. However, PNPM programs are implemented

by several executing agencies and the quality of the MIS systems varies considerably. Data which is received by SIMPADU is therefore of varying quality and reliability which creates concerns for the quality of data provided by SIMPADU.

Key Results

Result Indicators

Unit of Measure

Baseline

Total Target

Targets 2011

2012

2013

Progress as of Dec 31, 2014 2012

Difference with cumulative target for 2012

Development Objective: To enable Government institutions to more effectively monitor and plan interventions designed to reduce poverty throughout Indonesia SIMPADU fully integrated with the MIS of PNPM Mandiri programs.

# of PNPM Mandiri programs

3 (under SIMPADU 1.0)

13 PNPM programs integrated

5

13

13

10

(3)—delays for PPIP, Border and Integrasi

SIMPADU data quality & analytical capabilities enhanced & aligned with PNPM Man­ diri’s existing M&E frame­ work.

n/a

Original database engine had very limited features

n/a

Migration to new database & ap­ plication engine; status update; Home admin­ istrator; Updated ETL

Update ETL ap­ plication for other PNPM sectors, additional features i.e.: Chart; Thematic; Pivot; Statistic; Regional profile

Updated data ware­ house for all PNPM programs

Migration to new database & application engine, sta­ tus update, home, ad­ ministrator; updated ETL for Green, Tourism, RIS, Agriculture, additional features

On track

Increased capacity of MIS teams of all PNPM programs to manage the integrated system & collect complete & accurate data from the field.

n/a

No direct involvement of SIMPADU team with the MIS team of PNPM programs

n/a

TA to PNPM Rural

TA to MIS TA to MIS staff in staff in various various PNPM PNPM secretariats secretariats continues continues

TA to all MIS staffs

TA ongoing but 10 out of 13 programs still face difficulties with standardized data formats

Socialization to 5 provinces completed; Dvp starts; Training for provincial stake– holders

Delays— Dvp of the 13 province level SIMPADUs will be completed in 2013

Increased # of No  13 involvement provinces involvement (increased of local covered of local from 5 governments by government initially) in SIMPADU province pilot level provinces SIMPADU

5

13


Window Two | 103

Creative Communities 2 Summary Information Status

Active

Task Team Leader

Susanne Holste (sholste@worldbank.org)

Executing Agencies

Yayasan Kelola and PSF

Start Date to Closing Date

19 September 2012 to 31 December 2013

Geographic Coverage

To be determined

Approved Budget

US$ 0.9 million (Phase 1)

Project Rationale and Overview The Creative Communities 2 (CC2) project provides support to local cultural organizations to conduct community–based cultural activities that strengthen public participation in the PNPM program and that give voice to poor and marginalized members of the community. The underlying principle of the project is that cultural expression, in its many varied manifestations, can build social cohesion, strengthen local identity and channel the aspirations of the community. Local cultural organizations have a comparative advantage in providing an accessible channel of expression for poor and marginalized people at the grassroots level in a way that formal government structures often are not able to. Such organizations play an important role in the everyday life of the communities in which they operate. Many artists also have a sense of mission to contribute to the community through their work. The goal of CC2 is to utilize these comparative advantages to promote the achievement of PNPM program goals. This project builds on the lessons learned from the Creative Communities 1 (CC1) project, which was implemented in the period from 2008 to 2010. Results from CC1 have shown that the project effectively facilitated the use of cultural mediums to increase public participation in PNPM, including participation by poor and marginalized members of the community. The CC2 project supports the implementation of the PNPM Roadmap16 by building the capacity of facilitators to use

16 Specifically, actions #1.2 (Refinement of the Structure and Form of Participatory Assistance [Facilitation] for Community) and #2.3 (Increases the role and capacity of community empowerment cadres towards the empowerment sustainability).

cultural mediums to improve the quality of facilitation. Creative Communities 2 is intended to address two major constraints to the achievement of the PNPM program’s goals, which have been identified as: (a) sub–optimal levels of public participation, particularly on the part of poor and marginalized groups; and (b) decreased levels of enthusiasm on the part of members of communities. In order to utilize the comparative advantages of local cultural organizations to achieve PNPM program goals while at the same time allowing sufficient flexibility for creativity and free expression, the project works by providing a grant to a leading national arts organization that either on–grants to other smaller, less established arts and cultural organizations or directly partners with identified individual artists and cultural organizations to implement community–based cultural activities in collaboration with PNPM. Through the project, activities such as participatory theater, visual arts programs, musical performances and other events and activities can be implemented with local PNPM teams, often as an integral part of PNPM processes, such as village meetings. The project will be implemented in two phases, Phase 1 (Operational Setup) and Phase 2 (Implementation). The JMC approved funding for Phase 1 in April 2012. Additional funding needed for the implementation of Phase 2 will be requested following a mid–term review of the project, which will be conducted to assess the progress of the project and the performance of the implementing agency towards the end of Phase 1. Subject to funding approval, Phase 2 is expected to run from March 2014 to June 2015. Phase 2 will operate as a pilot project to test the project design in approximately 50 sub–districts that receive funds from the PNPM Rural and PNPM Generasi programs.

Progress in 2012 Phase 1 of CC2 began in September 2012. During this phase, the goal is to develop the operational design for the project and to undertake preparatory steps to implement it. Modifications of the project design were carried out to incorporate the lessons from Creative Communities 1 and from the findings of a field assessment, which identified existing cultural activities and potential local partners able to support community empowerment. During this phase, activities will be carried out in three sub–districts to test the design modifications. Project locations will be determined with PNPM stakeholders, based on a set of agreed upon criteria.


104 | 2012 PSF PROGRESS REPORT

Yunus, head of LKM Ubo Ubo, Ternate, showing hadicrafts produced from cocconut shells.

In 2012, extensive stakeholder consultations took place with Government counterparts, Indonesian arts and cultural organizations, and international development partners. The stakeholders indicated their support for the project. At the national level, there is broad agreement on the basic implementation structure. During the year, the project initiated small–scale community–based cultural activities and recorded good practices to inform project design and mechanisms for working with cultural groups. For example, in August, a PNPM mural painting initiative was carried out to celebrate Indonesia Independence Day in three PNPM Rural locations. A field assessment began in October 2012 to identify existing and potential community–based cultural activities and organizations that can be supported through the project, as well as to collect inputs from local stakeholders on the concept of Creative Communities. Field work in 12 districts and six provinces (East Java, West Nusa Tenggara, East Nusa Tenggara, West Kalimantan, South Sulawesi and West Sumatra) has been completed.

In November, Yayasan Kelola was selected as the project’s joint implementing agency through a competitive process. Yayasan Kelola was established in May 1999 as a national arts service organization. With its base in Jakarta, it has trained more than 1,000 artists and provided grants to 206 arts and cultural groups across Indonesia. As one of the leading arts organizations in Indonesia, Yayasan Kelola is well positioned to bring together local arts and cultural groups to harness local creativity for the empowerment of poor and marginalized people.17 A grant agreement with Yayasan Kelola is currently being processed, with implementation expected to begin in the first quarter of 2013.

17 Yayasan Kelola was awarded a previous grant (Japan Social Development Fund) to manage Creative Communities 1 in 2008. Its management of the grant was satisfactory.


Window Two | 105

Future Plans

Based on the project design, an operational work plan and M&E framework will be developed. A baseline study will be carried out to collect baseline data for the key project Indicators from the identified project locations, which will be determined in collaboration with the Government.

PNPM facilitators are finding it increasingly difficult to motivate community members to participate in PNPM processes: PNPM facilitators agree that cultural mediums can be used to improve levels of public participation. A few teams have already worked with local cultural groups to support PNPM. However, these collaborations tend to use cultural expressions to promote PNPM, and less often to encourage critical discussions or to give voice to poor and marginalized members of the community. Facilitators would like the PNPM’s Technical and Operational Guidelines to provide them with a clear basis to use cultural approaches to enhance the community empowerment process and to achieve these broader goals.

The project modifications will be tested in three sub–districts. Partnership with a range of cultural organizations will be established to carry out community–based cultural activities in collaboration with the local PNPM teams. Sub–grants will be provided to cultural organizations to implement activities, which use cultural tools to increase public participation and to give voice to poor and marginalized people.

Many forms of cultural expression in the surveyed regions could potentially be used to increase levels of public participation in PNPM: The choice of the cultural expression forms should take into account their different levels of capacity to a) draw large crowds; b) convey messages effectively; c) promote critical debates and dialogues; d) give voice to poor and marginalized people; and e) stimulate active participation.

Forty master trainers will be trained in the Creative Communities approach to ensure they have the skills and capacities to conduct further training when the project is rolled out in Phase 2. Video documentation of best practices will be provided to PNPM facilitators to encourage them to use cultural approaches to engage with target beneficiaries.

The attitudes of different elements of local communities towards a given form of cultural expression can vary widely, even within small geographic areas: To ensure that sponsored activities facilitate the achievement of project goals, it is important to understand the local context and to seek local input when determining project activities in each region.

It is expected that these activities will be completed by March 2014. Subject to funding approval, Phase 2 is expected to run from March 2014 to June 2015. During this phase, the project design will be tested in approximately 50 sub–districts that receive funds from the PNPM Rural and PNPM Generasi programs. The project will establish partnerships with a range of cultural organizations in Indonesia to carry out community–based cultural activities that will support PNPM’s aim of community empowerment. It will also build the capacities of PNPM field consultants to use cultural approaches to engage with target beneficiaries. The project locations will be made on the basis of the findings and consultations from Phase 1.

Many cultural forms are dominated by men, with limited or non–existent participation by women: To facilitate inclusion, the project should actively promote female participation in sponsored activities.

The field assessment report will be finalized in March 2013. A workshop with key stakeholders will be held to discuss the field assessment findings and to identify the main types of cultural mediums that will be used to strengthen PNPM’s outcomes. The project’s operational design will be modified on the basis of the field assessment findings, outcomes of the workshops and lessons learned from CC1.

Lessons learned The key findings of CC2 field assessment have indicated a number of areas that should be taken into account in the operational design of the project:

Arts and cultural groups at the local levels tend to be loosely organized and lack project management skills: Thus, they require capacity building support to manage and plan their activities to achieve project goals.


Mural painting In Majalengka, North Lombok and Tanah Datar, members of the local community painted murals to express their aspirations and to raise awareness regarding issues related to PNPM and the Creative Communities 2 project. Over a week, a team of artists supported by the PNPM facilitators, brainstormed ideas and created murals with these community members. The activity received positive support from the villagers, local government and PNPM facilitators. In Majalengka, it culminated in a cultural event attended by hundreds of villagers, during which the best murals were announced. In North Lombok, the sub–district head attended a ceremony to mark the creation of murals created by the villagers at an early childhood learning center (PAUD) constructed using PNPM funds. Young people were especially enthusiastic. Syahrul from North Lombok (22–year–old) said, ‘This activity is the first of its kind in this village. Painting is my hobby, but there’s little opportunity to paint. We hope this activity will continue next year.’

Iman, a village facilitator from Jatipamor, said that the mural activity has ‘helped strengthen the community by increasing a sense of belonging to the village.’ Evidence of this comes from the construction of an irrigation canal to address water shortage in Jatipamor. The irrigation plan was first illustrated on one of the murals, motivating the villagers to realize the plan using village funds and community contribution. The activity also became a catalyst for other local initiatives. For example, the village head of Jatipamor invited villagers to decorate the walls of the village hall with paintings on Indonesia’s nation building. In another instance, the Majalengka district branch of the Ministry of Communication and Information Technology held its own mural painting competition to mark its anniversary. A group of artists have also since come together to form an art collective to promote local creativity. The village government has demonstrated its support by providing them with a village building to serve as a workspace.

The mural (left) on the benefits of water management motivated villagers to construct an irrigation canal (right) to address the problem of water shortage in Jatipamor village.


Window Two | 107

Key Results (For Phase 1)

Result Indicators

Targets Baseline

Total Target

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To carry out preparation and pilot activities for Creative Communities 2 (CC 2), and ensure the design of the program uses locally–appropriate cultural approaches to enhance public participation and increases voices of the poor and marginalized groups in decision–making. Project design improvements completed & CCII formally launched

n/a

CC 2 formally launched

Concept note & operational plan developed

Project design improvements completed

CC 2 formally launched

Concept note developed

Plan will be developed once grant has been activated

Pilot indicates improvements in public participation

#/type of participants; # of people who feel able to participate in PNPM( Targets TBD after baseline study)

[Pilot activities planned & carried out]

[Pilot activities completed]

TBD [Evaluation of pilot activities completed ]

Pilot planning ongoing

Some delays because of delays in activation of grant

Pilot indicates that poor & marginalized people are better able to raise their concerns

# of poor & marginalized people attending and contributing to PNPM; # of poor & marginalized people who feel they can voice their needs (targets TBD after baseline study)

[Pilot activities planned & carried out]

[Pilot activities completed]

TBD [Evaluation of pilot activities completed ]

Pilot planning ongoing

Some delays because of delays in activation of grant

Field assessment to identify existing cultural activities & potential locations

Field assessment completed

Field assessment completed

Baseline study completed

Baseline study completed

Design of baseline study

Baseline data collected

Not yet started because of delays in grant processing

# of facilitators trained in using cultural methodology

0

40 facilitators

n/a

40

0

Training planned for 2013 Q3

Fieldwork & Minor delays draft reports (Field work completed done, report will be completed in Jan 2013)


A female household head in West Sumba, NTT. Females heads of households are amongst the most marginalized members of Indonesian society.


Window Three On–Granting to Indonesian Civil Society

Recognizing that PNPM’s broad brush approach was not reaching the most marginalized, who require more intensive and specialized facilitation, the PSF opened a new Window in 2011 to channel resources to Indonesian CSOs who work at the grassroots level to help marginalized people develop new skills, access services, learn about their rights and engage with government. PNPM Peduli, which in its pilot phase involves 72 Indonesian CSOs and more than 400 groups of marginalized people, is delivering promising early results. Beneficiaries are reporting improvements in their access to education, health and legal services and in their capacity to come together to establish and manage their own small businesses. An external assessment conducted in late 2012 confirmed that the pilot phase is on track and has established a set of relationships and business systems that will support PNPM Peduli to move forwards in developing and understanding effective approaches to reaching and empowering marginalized groups. The next phase, which will start in mid–2013, will place a stronger focus on rights and justice and shift

from a portfolio of discrete activities to a programmatic approach which should enable the program to address drivers of social exclusion (institutional, policy related or behavioral/attitudinal). The approval of a new project that specifically targets Disabled People Organizations (DPOs) was another promising development in 2012. The project will use an on–granting scheme similar to that of Peduli, but tailored to the specific needs and challenges of persons living with disabilities and to the organization that work with them. The project’s operational design is currently being refined through intensive consultations, and the first expected result in 2013 will be the mapping of DPOs in Eastern Indonesia.


110 | 2012 PSF PROGRESS REPORT

PNPM Peduli Summary Information Status

Active

Task Team Leader

Sonja Edith Litz (slitz@worldbank.org)

Executing Agencies

Lakpesdam NU, Kemitraan, ACE and PSF

Start Date to Closing Date

30 June 2011 to 31 December 2013

Geographic Coverage

In the pilot phase, PNPM Peduli is reaching 231 villages in 91 districts across 24 provinces: Bali, Banten, Bengkulu, Central Sulawesi, DKI Jakarta, DI Yogyakarta, Central Kalimantan, East Kalimantan, Central Java, East Java, East Nusa Tenggara, Jambi, Lampung, Maluku, Nanggroe Aceh Darussalam, North Sumatera, North Sulawesi, West Nusa Tenggara, Papua, South Sumatera, South Sulawesi, West Java, West Kalimantan and West Papua.

Approved Budget

US$ 9.7 million

Project Rationale and Overview PNPM Peduli was established as a manifestation of the Government’s commitment to fostering inclusive and equitable growth and to ensuring that all members of society are empowered to achieve their full potential. Those who are excluded from social, political, economic and/or cultural life include street children, domestic workers, orphans, migrant workers, sex workers, youth in conflict with the law, drug users, street buskers, female–headed households, landless farmers, victims of domestic or community abuse, rural fisher folk, trafficked women, victims of conflict, among others. They often have different needs from other poor members of society and face challenges that do not necessarily relate to poverty or income. In particular, they often face systemic social, institutional and legal discrimination which limits their ability to access services or to participate in community activities, including participatory development programs. Sometimes, the stigmatization experienced by these people is internalized, which means that they lack confidence or even feel that they have no claim to the rights and privileges enjoyed by other members of society.

Global best practice shows that civil society organizations (CSOs) are usually better able to meet the specific needs of the marginalized than government agencies or other institutions. CSOs often have well established networks of contacts among specific excluded groups and a high level of commitment to advocating with them for their rights and to improving their socioeconomic conditions. Operating without the constraints that limit government agencies, these groups are often in the best position to truly determine the aspirations of the groups that they work with and can test and implement innovative approaches. However, CSOs must have the capacities and skills sets that enable them to play the intermediary role effectively. In order to facilitate the funding and to develop the capacities of small CSOs while at the same time keeping overhead costs to a minimum, Peduli works by providing grants to a number of major, established Indonesian CSOs (Executing Organizations, or EOs). EOs award grants to smaller, less established CSOs, or, if the EO is a nation–wide membership–based organization, award grants to qualified branches. Local partners receive grants to implement activities related to economic development, access to services and rights and social justice. These activities are intended to enable members of marginalized groups to develop new skills, access services, and to establish meaningful connections within the community. Best practice shows that empowerment of citizens requires a rights–based approach rather than one only focused on meeting direct and immediate needs. Peduli aims to explore rights–based and other approaches to addressing exclusion and to share learning on what works and why. Peduli focuses on three main areas: Creating partnerships between CSOs and marginalized groups to implement innovative approaches to empowering groups of marginalized people so that they become more self–reliant, take action, access services and participate in social, economic, political and cultural life. The program finances small activities carried out by local CSOs in partnership with marginalized individuals and groups including small economic activities, supporting access to health/education and legal services, provision of specialized services (e.g. anti–retrovirals for HIV and AIDS treatment), and activities on rights and social justice;


Children from the Suku Anak Dalam, a vulnerable nomadic group who live mostly in the Merangin District, Jambi. These children attend non-formal schooling facilitated by volunteers trained by SSS Pundi through the Peduli program.


In Manokwari District, West Papua, a group of indigenous farmers engage in organic farming with the support of the Kamuki organization through the Peduli program.


Window Three | 113

Strengthening the capacity of Indonesian CSOs to implement participatory and inclusive programs through capacity building activities that allow CSOs to facilitate development processes where marginalized men, women, children and transgender persons are empowered to take action, access services and participate. Increasing the capacities of Indonesian EOs at the national level to manage small grants, to identify and provide technical support to CSO partners that work with marginalized groups, and to develop strategies to translate their knowledge and learning to bring about change at the local and national level (policies, regulations or societal attitudes). In January 2010, the PSF’s Joint Management Committee approved an initial start–up budget of US$4.2 million to design the program pilot and select CSOs as grant recipients. The design was intended to ensure flexibility in order to test different approaches to working on issues of marginalization and to engage a diverse range of marginalized individuals/groups and CSO partners

(including non–government organizations, community based groups, membership based organizations and mass based organizations). In 2011, three national organizations, the program’s Executing Organizations (EOs), were selected through a competitive process, with grant agreements being signed in June 2011. Two of the EOs are Indonesian grant–making organizations, these being the Association for Community Empowerment (ACE) and the Partnership for Governance Reform (Kemitraan). The third appointed EO is the Institute for Human Resource Study and Development (LAKPESDAM), an institute under the organizational framework of Nahdlatul Ulama (NU), a mass–based, faith–based organization with branches throughout Indonesia. These EOs received and reviewed proposals from a range of CSO and branch partners and awarded sub–grants to a total of 69 local partners. By October 2011, local level activities conducted by local CSOs/NU branches in partnership with marginalized individuals/groups had begun on the ground.

Figure 22. Number of Peduli partners

Executing 3 National Organisations

69 Local NGO’s of marginalized 404 Groups people

Figure 23. Gender composition of Peduli beneficiaries

4% (441)

Transgender

28% (3,585) Men

68% (8,615) Women


114 | 2012 PSF PROGRESS REPORT

Members of an LGBT (Lesbian, Gay, Bisexual and Transgender) group in Bandung, West Java, take part in cooking classes with the support of the Abiasa organization through the Peduli program.

Progress in 2012 The development objective in the pilot phase has been to strengthen the capacities of Indonesian CSOs to reach and to empower marginalized groups to improve their socio–economic conditions. The pilot phase involves 72 Indonesian CSOs, of which 69 are grant recipients under the three EOs (39 local CSOs and 30 branches of NU). Of these CSOs, 66 are implementing activities with marginalized groups in 231 villages in 91 districts across 24 provinces throughout Indonesia. Peduli facilitated activities involved 12,641 marginalized individuals. In April 2012, the JMC approved an additional US$5,500,000 and extension of the pilot phase to December 2012 to allow Peduli time to consolidate activities and strengthen results. The additional financing brought the total program budget to US$9,715,000. Numerous capacity building activities were carried out with the EOs and CSOs in 2012 that improved the systems for grant management; strengthened fiduciary systems; provided a better understanding of the potential and

strength of marginalized people; and provided practical techniques to implement participatory approaches when working with marginalized group in communities. These capacity building activities have also led to increased engagement with local and national stakeholders, particularly local government agencies and in some cases the private sector. Between August and October 2012, an external assessment was carried out to help refine the strategic focus of the program as it moves to Phase 2. This assessment involved field work across five provinces and consultations or field observations involving 25 percent of sub–projects. The assessment concluded that Peduli: zz Effectively established a set of relationships and business systems that will enable the program to develop effective approaches to reaching and empowering marginalized groups in Indonesia into the future; zz Needs better tools for targeting partners and ensuring rigorous review of partner programs;


Window Three | 115

zz

zz

Needs a stronger focus on rights and justice to address drivers of social exclusion (institutional, policy related or behavioral/attitudinal); Should shift from a portfolio of discrete activities to a programmatic approach, in which EOs build on their own individual strengths, experience and support their organizational vision and mission.

Future Plans As Peduli moves into Phase 2 in 2013, the program will build on lessons learned during the pilot phase and continue to develop a body of knowledge on promoting pathways to inclusion. The aim is for national CSOs to translate this knowledge into policy advice to enable the Government to strengthen line ministries mandated to meet the needs of target populations currently excluded from public services and systems. The aim is also to build social relationships between those who have been marginalized and the broader society by reducing stigma and breaking down barriers in society. During the first half of 2013, EOs will focus on developing evidence–based designs to be reviewed and approved for implementation in Phase 2. At the same time, EOs will continue to manage the implementation of local partner activities and to prepare selected partners for Phase II implementation, planned to begin in mid–2013. Design work will incorporate lessons learned from program experience and input from the external assessment. EOs will carry out field work, research and analytical work to design their Phase II that reflect their organizational vision and mission and draw on their expertise. The types of programs proposed by EOs include those focusing on improving access to basic services for indigenous populations in forested and border areas; addressing social conflict and facilitating reintegration following such conflict; and facilitating access to health services by members of marginalized groups.

Lessons Learned Although the program has committed to EOs over the medium term through written legal agreements, funding is short term with small six–monthly disbursements. This is due to availability of PSF funding. CSOs have therefore tended to focus on short–term activities with quick results, at the expense of medium–term activities intended to achieve broader social inclusion. The program needs to secure a block of funding to cover—at minimum—two years

of implementation to strengthen project ownership and partnerships and to ensure the effective capacity development of local CSOs, particularly those that are small and fragile; The ability of the program to reach and work with the most marginalized has been a result of the strong voice of CSOs in shaping the program design, in selecting CSO partners and in identifying marginalized communities. The program must ensure that as it scales up, it maintains mechanisms that allow for CSO autonomy in selection of partnerships, and in working with communities to determine the most appropriate investments; Enhancing the procurement capacity of CSOs should focus on principles of good procurement (transparency, accountability, efficiency and value for money) so that the focus is on performance for achieving results, not on compliance. The Bank must support and accelerate the program’s efforts to simplify procurement processes so that CSOs are allowed to use their own systems and forms but are provided with capacity support to strengthen these systems.


116 | 2012 PSF PROGRESS REPORT

Key Results

Result Indicators

Targets Baseline

Total Target

2011

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To strengthen the capacities of Indonesian CSOs to reach and empower marginalized groups to improve their socio economic conditions # of direct beneficiaries from marginalized groups (m/f/ transgender)

N/A

Total 11,041

Total 9,125

Total 10,037

Total 11,041

Total 12,641

3,516

6,983 (f )– 63.25%

5,793 (f )–63%

6,349 (f )–63.25%

6,983 (f )– 63.25%

8,615(f )–68%

There was increased demand for involvement in activities under Kemitraan’s program

3,974 (m)–36%

3,247 (m)–36%

3,613 (m)–36%

3,974 (m)–36%

3,585(m)– 28%

84 (t)–0.75%

85 (t)–1%

75(t) –0.75%

84 (t)–0.75%

441(t)–3%

# of community groups/village branches engaging with local government on their rights, access to services and improving livelihoods

N/A

488

404

444

488

404

On target

# of funded local projects working with marginalized groups

N/A

57

66

50

57

66

On target. In Phase 2, Peduli will reduce # of CSOs.

# of provinces/ district/ villages in which Peduli projects are working

N/A

Provinces–24

Districts–91

Districts–91

Districts–91

Districts–91

Districts–91

Villages–280

Villages–231

Villages–254

Villages–280

Villages–231

# of CSOs/ branches staff participating in capacity building activities

N/A

147

122

134

147

184

Provinces–24 Provinces–24 Provinces–24 Provinces–24

On target

+62 (the increase is due to CSO staff turn–over. New staff required training.)


Former Political Prisoners Build a New Life In the heat of the afternoon, Redjomulyo (75) is busy producing organic compost from dry leaves and sugar cane waste. He is working together with other members of the Sido Maju group in Ponjong, Gunungkidul. “I’m going to use the compost on my vegetable patch behind my house. Producing organic compost is a way for me and other former political prisoners to escape from poverty,” he said. In Wonosari subdistrict, Triwinarni (40) is working the pedals of a manual sewing machine with three of her friends, all members of the Mawar Indah group. “We have all taken part in sewing classes, now we are learning how to make well designed dresses. We received an order for 40 dresses from our trainer, but half of them didn’t meet the required standards,” said Tri, holding up some of the dresses that she and her friends had produced. Even despite the rejection, she and her friends are happy to be learning new skills. “We’ve still got a lot to learn,” said this daughter of a former active member of the Indonesian Communist Party. “Until recently, nobody trusted us. If we gathered together in a group, we were accused of Communist activities. When we first formed this group, some policeman came to check on us and to ask us what we were doing. When they found out that we were participating in a government program, they left us in peace,” said Tri. In order to provide support to former political prisoners and members of their family in Gunung Kidul, the government is working with Lakpesdam NU. The facilitator from the Gunungkidul branch of this organization, Zaenuri Ikhsan, states that the program is specifically intended to benefit former political prisoners and members of their family, most of whom continue to live in dire poverty. Since the putative coup attempt in 1965, many of these people have had extreme difficulty earning a living or in accessing basic government services. Of the 650,000 poor people living in the Gunungkidul district, approximately 22.05 percent fall into this category.

The Traumatic Putative Coup Attempt of 1965 “I was imprisoned without trial for three years in the Wirogunan Prison in Yogyakarta. Every day, I was tortured by up to 10 guards, from morning until night,” said Redjomulyo.

Other members of the Sido Maju had similar experiences. Hadi Siswanto (75) was suspected of involvement in the Indonesian Communist Party and detained at the Wonosari For two years without trial. “I was sacked from my position as the headmaster of the school. My wife was sacked from her position as a teacher. I was sent to the camp and my family was left without means of support,” said Hadi, who now works as an agricultural labor earning approximately Rp 20,000 per day. Sutilah (69) is a former performer in the Mudo Widodo Ketoprak group, which performed traditional Javanese dramas. She was also subjected to a similar punishment for her alleged involvement in the cultural wing of the Indonesian Communist Party, Lekra. With her identity card clearly stamped with “ET”, signifying that she is a former political prisoner, she has never been able to participate in government welfare programs. Even when her children wanted to get married, the authorities made it difficult for her. “Sometimes, I almost give up in despair. I feel useless,” she said. With tears in her eyes, she says that she has always been excluded from government welfare programs. It was only in 2012 that she was permitted to participate in Jaminan Kesehatan Semesta, the government health insurance program. “I’m very grateful to be involved in the Government’s PNPM Peduli program. After living in fear for so many years, we are beginning to have some hope again. This is the way things should be,” she said.

PNPM Peduli “The Sido Maju group was established so that we can support each other to raise fish and grow crops, to learn from each other and to support each other through savings and loan groups with low interest rates,” said Redjomulyo. The discrimination that they have suffered drives them to support each other in their efforts to overcome the difficulties they face. Ikhsan says that since October 2011, 150 members of the community in Gunungkidul have received support through the program. At first, it wasn’t easy to get former political prisoners involved. Many of them were still scared. At first, Lakpesdam NU established by community groups with support from PNPM Peduli. The Mawar Indah group, based in Wonosari and involving 30 members, was established to provide sewing lessons. The Sido Maju group, based in Pojong and involving 30 members, was


A former political prisoner taking part in PNPM Peduli, the first Indonesian government program to provide siginificant assistance to members of a group who have been reviled and despised for decades.

established to support agricultural activities. The Menur group, with 25 members, was established to enable these members to produce snacks for sale in Ponjong. The Nggowo Berkah group, with 21 members, and the Sumber Rejeki group, with 44 members, also focus on preparing food for sale. Sutilah says that she hopes that in the future, members of the groups will be able to establish a clothes producing company to provide an income for all members.

“Even now, all members of the groups benefit by earning extra income. For example, members of the Menur group sell small packets of snacks for Rp 500. Some of them can sell up to 300 packets per month,� said Ikhsan. According to Ikhsan, through these activities, some members of the groups are earning up to Rp 100,000 per month. Even more importantly, they are gaining a sense of self–esteem and no longer feel rejected by the community and the government.


Window Three | 119

Supporting Disabled People Organizations Summary Information Status

Being activated

Task Team Leader

Natasha Hayward (nhayward@worldbank.org)

Executing Agencies

NGO Executing Organization (not yet selected) and PSF

Start Date to Closing Date

1 October 2012 to 31 December 2014

Geographic Coverage

National

Approved Budget

US$ 1.8 million

Project Rationale and Overview There are 20 million people with disabilities (PWDs) in Indonesia, 25 percent of whom live in extreme poverty. Indonesia’s high incidence of disability is aggravated by the relative poverty of communities and servicing agents. While people with disabilities have the same aspirations and basic needs as those without disabilities, including access to and opportunities for education, health care, gainful employment, leading productive lives and contributing to their community and society at large, existing Government social protection, social services and poverty reduction programs are not adequately meeting PWDs’ economic, social and political needs. Disability inclusion across poverty reduction programs in Indonesia has begun to gain traction in response to Indonesia’s ratification of the UN Convention on the Rights of Persons with Disabilities (CRPD) in October 2011. However, current efforts to achieve disability inclusion remain disjointed and inefficient due to the lack of accurate data regarding the situation of persons with disabilities, as well as inadequate information sharing and coordination among multiple actors in various sectors. In this context, in early 2012, the Government requested the creation of a PSF–supported project dedicated to Disabled Peoples’ Organizations (DPOs) to help meet disability–related local, national, regional and international goals. This engagement would focus on generating lessons to improve policy formulation and service delivery to better meet the needs of PWDs.

Preliminary technical consultations have shown that most mainstream CSOs have only a limited understanding of issues related to the inclusion of PWDs and that there is no national DPO with the management and technical capacities to act as an Executing Organization (EO) to manage a scalable, targeted on–granting program. The available data and information on DPOs and PWDs are also both inaccurate and outdated. Key ministries and other development partners who support disability programs have expressed the need for a central common data repository to facilitate access to a range of information related to DPOs. The DPO project provides a unique opportunity to engage and strengthen DPOs and other disability–specific organizations through a targeted on–granting approach. Grants will be focused on capacity building and organizational development to support substantive long–term advocacy regarding inclusion and poverty reduction for persons with disabilities. An important, necessary first step to provide adequate support to DPOs will be to address the deficit of data regarding their organizational and technical capacities and ongoing activities. The project will map DPOs in Eastern Indonesia, where data gaps are more severe and where the needs of persons with disabilities are compounded by the development challenges of disadvantaged areas. It will also support the establishment of a Multi–Stakeholder Forum to provide a venue for the Government, DPOs and development partners to formulate more coherent disability–related policies and programs. Building on these two activities, the project will provide customized capacity building and organizational development support to DPOs through an Executing Organization (EO) which will on–grant to selected DPOs. The project will thus provide accessible resources to DPOs and PWDs to enable them to acquire advocacy skills and knowledge and to build the collaborative networks they need to become actors rather objects of disability policy and programs and thus to foster their inclusion into the wider community.

Progress in 2012 Technical consultations were carried out with twelve national umbrella DPOs based in Jakarta and Java, and with four international NGOs and three ministries who manage programs focused on PWDs in Indonesia. These consultations provided a basis for the formulation of a flexible design for the DPO project, though further refinements are expected on the basis of the findings of the DPO mapping.


120 | 2012 PSF PROGRESS REPORT

PNPM DPO works with disabled Indonesians to improve their access to public services, justice and economic opportunities.

The project’s start–up phase involved further technical consultations with stakeholders and intensive socialization of the project’s concept. The project organized a two–day workshop to introduce the DPO project and ILO’s PROPEL (Promoting Rights and Opportunities for People with Disabilities in Employment through Legislation) to national DPOs, CSOs, ministries, international donor agencies, NGOs, academics and research institutes. This workshop generated valuable inputs for the ongoing development of the DPO implementation strategy, with general consensus on the need for: (a) the creation of an accurate and up–to–date database of grassroots DPOs’ organizational profiles to inform the activities of donors and other NGOs; (b) a focus on small, non–Jakarta based DPOs, which have a greater need for capacity support; and (c) agreement on the need to select an EO that has demonstrable and sincere interest in supporting

and sustaining DPOs. The workshop was followed up with preparatory activities for the DPO mapping in Eastern Indonesia. The specific challenges of engaging a new sub–sector, where information is limited and institutions are not well established, are already manifest and have created some delays in implementation. Engaging with groups which have a low visibility and specific communications and accessibility needs is indeed extremely resource intensive. Issues related to accessibility, particularly access to information and resources to enable the participation of people with disabilities in project activities, will need to be considered in future budgets. For instance, to ensure the inclusive participation of all types of PWD groups in the two–day consultation workshop, the project had


Window Three | 121

In 2013, in consultation with project stakeholders, the project team will also identify a suitable EO partner. The team will work together with the identified EO partner to develop an approach to selecting recipient DPOs and CSOs and to facilitating grant–making and the provision of capacity support to meet the specific needs and challenges of DPOs. A key criterion for the selection of the EO partner will be a demonstrable commitment to working in areas related to disability issues in the long term and to engagement with PWDs as actors rather than as the objects of disability policy and programs.

to provide materials in Braille sign, large print, audio formats, sign language interpreters, note–takers and contract service providers for blind, paraplegic and quadriplegic participants.

Future Plans The project will complete the mapping of DPOs in Eastern Indonesia to identify potential partner organizations and to develop a more thorough understanding of the needs of DPOs and the types of activities the project should prioritize. The PSF technical team will organize focus group discussions and semi–structured questionnaires to gather both quantitative and qualitative data to further identify DPOs and appropriate activities to support them.

The first Multi–Stakeholder Forum, which is planned for May 2013, will focus on the alignment of priorities to support PWDs and DPOs at the policy level.

Key Results

Result Indicators

Targets Baseline

Total Target

2012

2013

2014

2015

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To enhance the capacity of both the Government and DPOs to represent People With Disabilities (PWDs) and engage key stakeholders in promoting the inclusion of PWDs in poverty reduction programs. TBD by baseline study

# of PWDs and type of participants by disability [target TBD after baseline study]

TBD [after MSF]

# of Ministries with specified ‘access point’ for PWDs/ DPOs [target TBD after MSF]

[Initial activities completed]

Field assessment and Baseline study of existing DPOs in Eastern Indonesia

Baseline study completed

Forum for collaborative policymaking for disability inclusion established and functioning

6 sessions annually

n/a

DPOs receive customized technical and organizational support/ capacity building

0

10 DPOs receive grants and training (tbc)

n/a

Increase in number of PWDs represented by project– supported DPOs Government has established clear ‘access points’ for PWDs/DPOs

TBD TBD [Contingent [Evaluation on EO of activities decisions under EO] and baseline]

n/a

n/a

TBD [after MSF]

TBD [after MSF]

n/a

Plan will be developed once grant has been activated

Design ongoing

Mapping to be conducted in 2013

6

6

n/a

The first formal multi– stakeholder forum is planned for April 2013

n/a

10

n/a

Training planned for 2014

Design Baseline of data baseline collected study and report complete


Kids play at a pre-school facility in Merangin District, Jambi. With most Indonesian children now attending primary school, an increasing demand for pre-school facilities is emerging in both rural and urban areas.


Window Four M&E and Special Studies

The PSF’s analytical work supports the formulation and implementation of the Government’s Roadmap and other commitments, maximizing the impacts of community–led development at the local level by linking operational experience and local–learning with applied research and evaluation, all in the service of a knowledge base of best–practice solutions for effective community–led programs in Indonesia. In 2012, the PSF’s M&E team completed all remaining evaluations from the 2009–2011 rounds as well as the Census of Village Infrastructure, which covered nearly all urban and rural villages in Indonesia (over 76,000 villages). This Census showed that the Government still has a long way to go simply to close the country’s gaps in basic village infrastructure. Seven new studies/evaluations were launched as part of the 2012–2014 round, three of which were completed during the year (Rapid Appraisal of Women’s Participation in PNPM Rural, Local Level Governance Review, mini Rate of Return Analysis). An analysis of the characteristics and dynamics of urban poverty, a comprehensive examination of the benefit incidence and targeting performance of the main anti–poverty programs and a process evaluation of PNPM Urban were also finalized in 2012 under a separate project, the Indonesia Urban Poverty Analysis, which has identified priorities for urbanization policies and options for the longer–term role of PNPM Urban. As part of the Roadmap process, the M&E team facilitated a collaborative stock–take of all these studies with key development partners and Government to provide a robust evidence–base for policy decisions.

Studies and field supervision have consistently identified Revolving Loan Funds (RLFs) as one of the key areas of risk and opportunities for PNPM. Results of the assessments conducted in 2011 by the RLF Pilot and a possible strategy for going forward were discussed with PNPM stakeholders, leading to a number of policy decisions. Economic empowerment for communities is recognized as a priority by the Government, and a strategy and associated implementation arrangements for a rural economic empowerment program will be developed in 2013. At the same time, the fiduciary controls and accountability mechanisms for RLFs need to be strengthened to mitigate the growing fiduciary risks posed by RLF operations. In 2012, a mapping of assets and idle capital held in each province created a risk profile, and additional fiduciary safeguards and accountability mechanisms were identified and consolidated into PNPM’s Operations Manuals. The Government has also decided to properly identify the financial health and sustainability of the RLFs and to provide clearer incentives to collect loans by requiring RLFs to post reserves for loans that may not be repaid. These steps are expected to help determine performance–based allocations of additional grants to RLFs planned for 2013, as well as identify those eligible for further strengthening through capacity building and MIS. The RLF Pilot Project will function as a laboratory to test good practices to build the capacities of RLFs and to establish linkages between RLFs and financial institutions. Studies have consistently emphasized the limits to community empowerment when operating in isolation from responsiveness on the supply–side. In Indonesia’s


124 | 2012 PSF PROGRESS REPORT

decentralized context, the Roadmap mandates a greater integration of development at the local level through the ‘One Village, One Plan, One Budget’ concept. The Local Governance Capacity Building Project supports this integration agenda by providing advice on how to mainstream PNPM practices of good governance and downward accountability into local government practices. In 2012, the local governance team prepared three policy notes and a consolidated report on how to improve the quality of public services and local government responsiveness through community engagement, building on a lessons learned from its 2011 stock–taking exercise, which emphasized improved accountability relationships as an essential building block for more functional, equitable, better quality service delivery. Building on a 10–district pilot—also completed in 2011— the local governance team began to scale up the delivery of the Pro–Poor Budget Planning Toolkit (P3BM), with the training of a second batch of 25 master trainers (out of a total targeted 280 trainers). Fifteen provinces have been selected for support, based on their commitment to share costs for the training and technical assistance clinics.

Seizing the opportunity created by the drafting of the Law on Village Government (RUU–Desa) to build the capacity of village governments on the basis of community–driven development, the local governance team also provided policy and operational inputs to the Government and civil society, and obtained approval from the PSF’s Joint Management Committee (JMC) for a Village Training Program, which will support the design of a curriculum and training for 500 master trainers, who will train trainers to prepare village institutions to manage the decentralization of funds and programs.


Window Four | 125

PSF Monitoring and Evaluation (M&E) and Special Studies Summary Information Status

Active

Task Team Leader

Natasha Hayward (nhayward@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

26 May 2008 to 31 December 2013

Geographic Coverage

National

Approved Budget

US$ 9.7 million

Project Rationale and Overview PNPM is built around the core hypotheses that a combined investment in the institutions, assets, and capabilities of the poor empowers the community to achieve more effective, just and inclusive poverty reduction outcomes. The PSF Monitoring and Evaluation (M&E) framework associated with PNPM and its pilots aims to link community–driven operations with applied research and evaluation, building a knowledge base to optimize the design of community–led programs such as PNPM and related Government policies. The objective is to increase such programs’ pro–poor impacts and to facilitate a better understanding of local–level social and institutional dynamics in Indonesia and of the influence of these dynamics on community empowerment and poverty reduction. The evaluation of the PNPM program and its pilots and associated projects has delivered significant practical and theoretical knowledge. As a result, evaluation and learning needs continue to evolve. Evidence confirms that PNPM Rural raises incomes, reduces poverty rates, and increases access to services, especially in poorer households and communities. Evidence also shows that PNPM Rural has effectively addressed part of the national deficit in tertiary infrastructure at a relatively low cost and to a high technical standard. However, evidence also shows that policy challenges remain: marginalized groups are less likely to participate and do not benefit from the program to the same extent as other groups; good governance practices in PNPM have not always spilled over into other local administrative

or government spheres; impacts on households in less poor sub–districts are limited; PNPM has not been able to address the constraints to long–term, productive livelihoods in all households and communities; and PNPM’s massive scale–up over a short period has produced a number of challenges in both scale and scope in the areas of management, quality control, and operations. The Government has committed to supporting PNPM through 2014 and has developed a Roadmap to provide guidance for that period and beyond. A major pillar in the Government’s Roadmap is the mainstreaming and integration of PNPM operating principles into local government, administrative, and service delivery operations. The low quality of service delivery and low levels of accountability are critical challenges, especially in the context of Indonesia’s ongoing process of decentralization, with a shifting equilibrium between central and local authority and responsibility. Currently, Indonesia, while a lower middle–income country, has poor public service delivery standards and outcomes, with performance in these terms significantly below regional peers, countries at the same level of economic development, and even some highly disadvantaged low–income countries. The PSF M&E framework for PNPM supports the Government’s Roadmap and other efforts to maximize the impact of community–led development at the local levels by linking operational experience and local learning with applied research and evaluation. The framework

Figure 24. Percentage of ongoing studies involving Indonesian research providers

COURSE

100%


126 | 2012 PSF PROGRESS REPORT

supports the ongoing development of a knowledge base of best–practice solutions for effective CDD and community–led programs in Indonesia. The M&E team’s analytical agenda focuses on research and solutions that aim to measure and increase such programs’ pro–poor impacts and to facilitate a better understanding of the social and institutional dynamics at the local level and their influence on community empowerment and development strategies and policies.

In addition to the nine planned evaluations, two additional analytical works were launched in 2011, these being the Village Infrastructure Census 2011 (a comprehensive infrastructure census of nearly all rural and urban villages in Indonesia) and the Incidence of Benefits Survey (a survey conducted to determine who benefits from Government poverty reduction programs in Cluster 1 and Cluster 2 and to understand communities’ perspectives on PNPM).

In implementing the analytical work, the M&E team has faced challenges in ensuring the quality of the work and timeliness of output delivery due to issues related to the capacities of local research organizations and/or think–tanks in Indonesia. The team has consistently partnered with local organizations as part of the PSF’s efforts to facilitate the building of the capacities of Indonesian organizations. It is hoped that by providing intensive training and experience throughout the implementation of evaluations and studies, the PSF can help local research organizations improve their skills and capacities.

For details of studies and evaluations completed in 2009–2011, see Annex 3.

Progress in 2012 In 2012, activities included the finalization of the remaining evaluations/studies from the planned 2009—2011 rounds (PNPM Rural Impact Evaluation and PEKKA Baseline Survey); the completion of the two additional evaluations from 2011 ( Village Infrastructure Census and Incidence of Benefits); and the initiation

Figure 25. Summary of completed and planned analytical works: 2010–2014

2010

20

1

• PNPM Rural Economic Impact Simulation • SEDAP Socioeconomic Survey Endline • Sentinel Village • RLF Expenditure Tracking Exercise • PNPM Generasi Evaluation (Mixed Methods) • Wider Governance Impact of PNPM • Community Groups Review • PEKKA’s Evaluation

12

• Village Infrastructure Census • Rapid Assessment of Women’s Participation in PNPM • Local Level Governance Review • Rate of Return analysis (EIRR) of PNPM-Rural Infrastructure Sub-projects • Peduli Pilot Assessment • Urban Poverty Profile and Program Review • PNPM Urban Process Evaluation

1

20

• PNPM Rural Impact Evaluation (mixed methods) • Marginalized groups study • Village Capacity in Maintaining Infrastructure • PNPM Generasi Impact Evaluation (Mixed Methods) • Perception of Local Governance Study

• PNPM Respek Infrastructure and Community Organisations Capacity Evaluations • PEKKA Baseline Survey • RLF Mapping and Assessment • LG Stocktaking Study of Development Planning • SPADA Lessons Learned • P2SPP Lessons Learned • P3BM Impact Assessment • Program and Public Expenditure Review of 8 HH-Based Social Assistance Program • PKH Impact Evaluation

2013 • Local Level Institutions 3 • Incidence of Households Benefits • Integration of Community-Based Poverty Reduction Program at Community Level • Papua Operational Research and Evaluation • RLF Legal Review • RLF Lessons Learned Stocktake

2014


Window Four | 127

Future Plans

PNPM Rural 2012—2014 Evaluations: Economic Impact Simulation: This exercise will demonstrate the nature and extent of the benefits PNPM brings to the Indonesian economy and to rural livelihoods. It will compare the ‘PNPM way’ of addressing local infrastructure and productive capital needs to a simulation of the next–best alternative for addressing those same needs. By cataloguing the local productivity gains, contributions to local economies and livelihoods, and cost savings for the central government, the Economic Impact Simulation will be a comprehensive summary of the measurable financial advantages of PNPM principles and an identification of the most effective parts of the PNPM process/delivery mechanism in supporting local economic gains.

For 2013, the M&E team will finalize four evaluations/studies from the 2012 round, as set out in Table 3. In addition, subject to approval by the JMC of top–up funding for the 2013–14 period, several new evaluations/studies are planned, as follows:

SEDAP Socioeconomic Survey End line: The SEDAP survey was previously carried out in 2007 and 2010. By repeating a panel socioeconomic survey of households in PNPM communities a third time, and by repeating

of seven new studies/evaluations, including several operational research pieces to provide data for PNPM Rural implementation. These new studies included the following: Local Level Institutions 3; Integration of Community–based Development Program at Local Level; a Rapid Appraisal of Women’s Participation in PNPM Rural; the Local Level Governance Review; PNPM Rural Mini EIRR and combined Papua Analytical Works (both qualitative and quantitative assessments). For details of studies and evaluations completed in 2012, see Annex 3.

Table 3: Evaluations/Studies from 2012 round to be completed in 2013

No

Name of Study

1 Local Level Institutions 3 (LLI3)

Expected Timeline for Result

Description of Study

Methodology

Observes changes in local organizational capacity and social capital (embodied in participation in community–based organizations); links changes in such capacity to shifts in community members’ influence over development decision–making, project implementation, and service provision at the district and community levels.

Mixed–methods First draft report expected Q1 2013 (longitudinal study, 1st one in nd 1996 and the 2 in 2001)

2 Incidence of Determining who actually benefits from PNPM as Household Benefits well as understanding community’s perspective of PNPM including its uses and its capacity to target the poor and vulnerable in particular.

Quantitative

Report expected Q1 2013

3 Integration of Community–based Poverty Reduction Programs at Community Level

Examining the integration of CDD programs at the community level and observing local community capacity to manage diverse development programs; lessons learned will be used as inputs to the development of integration strategy in PNPM Roadmap.

Qualitative

First draft report expected Q1 2013

4 Papua Operational Research and Evaluation

Mixed–methods (a) field work to be Two analytic pieces to be done related to PNPM RESPEK and conflict issues in Papua: (a) a qualitative conducted in Q2 beneficiary assessment to elevate voices from the 2013 field; (b) piggybacking SUSENAS with a specific (b) data collection PNPM module to collect and benchmark quantitative conducted every data/indicators from Papua and West Papua quarter in 2013


128 | 2012 PSF PROGRESS REPORT

it after the PNPM program has become national, the PSF team and other interested researchers will be able to determine in some detail the length, depth, and magnitude of the impacts of PNPM over a number of years by comparing early–adopter communities with late–adopter communities. An additional round of the SEDAP panel survey will also allow a longer–term look at the changing nature of participation in the PNPM program across a full distribution of households. Sentinel Villages: The aim of the Sentinel Villages project is to better understand the changing nature of communities’ experience and level of satisfaction with, as well as desires for, the PNPM program and of community members’ level of participation in the program. Understanding the way these experiences evolve will in turn lead to suggestions for changes in program implementation. The methodology will combine repeated qualitative work and analysis over a number of years with a quantitative analysis based on those same longitudinal, qualitative records. Research foci will include the changing nature of participation, social capital, and the evolution of democracy at the local level and its impacts on PNPM’s value. Results will directly support the further development of PNPM policy and the Roadmap, especially those policies focused on engaging local government effectively in poverty reduction programs and other pro–poor development initiatives. Revolving Loan Fund (RLF) Expenditure Tracking exercise: The Revolving Loan Fund initiative has delivered business–oriented credits to every community receiving PNPM block grants. However, very little is yet known about the nature of the local enterprises that these credits supported. The Government would like the RLF initiative to be an effective vehicle for facilitating access to both savings and credit facilities by marginalized households and communities. However, it has limited evidence and knowledge to serve as a basis for the formulation of policy in this area. This tracking exercise is the first building block in the construction of an RLF–centered evidence base and will complement the ongoing RLF pilot exercise and associated evaluation. Primary quantitative research questions will include: What are the characteristics of an RLF beneficiary? What are the characteristics of an RLF–group manager? To what uses were RLF credits put? How did beneficiaries treat RLF credits (i.e., as actual credits or something closer to a consumption–smoothing vehicle)? The evidence gathered can provide preliminary policy direction for the next round of analytical and research activities focused on the RLF initiative.

PNPM Generasi Evaluations: Quantitative Impact Evaluation: Discussions are continuing on whether to again use Randomized Control Trial methods (as was the case with the previous PNPM Generasi impact evaluation for the period from 2007 to 2010) to examine the impacts and results from an enhanced PNPM Generasi design and other initiatives. Areas where impacts are expected as a result of the new designs include front–line service provider capacity building; the community consumer and service provider interface; and new and effective incentives for service standards as well as accountability mechanisms. Additional quantitative work planned within the PNPM Generasi program and supported by the PSF M&E proposal may include: a) Evaluation of an Early Childhood Development and Education pilot with a focus on process monitoring; and b) Evaluation of the combined impacts, complementarities, and synergies between PKH and PNPM Generasi. Qualitative studies: The PNPM Generasi team is planning several medium–scale qualitative pieces in order to better understand how accountability between community members and service providers is created and sustained. This suite of studies, which the PSF M&E agenda will also support, may include: (a) a rapid evaluation of local level health provider capacity; (b) case studies detailing the interactions between community members and frontline service providers; (c) in those areas where PNPM Generasi will phase out in 2013, a prospective study summarizing the sustainability of community capacity that was built up through six years of participation in PNPM Generasi. Local Governance and Accountability Evaluations: Wider Governance impacts of PNPM: Building on the Local Level Institutions and other studies, this project will focus on what enables or constrains PNPM good governance practices to be taken up more widely within the community or by local governments. This piece will be linked to the evaluation of the LGCD Phase 2 work and the planned Enhanced Empowerment Experiment (EEE) pilot which will test mechanisms for improving participation and accountability. Community Groups review: This review, conceived and undertaken in collaboration with the National Team for Accelerating Poverty Reduction ( TNP2K), will catalogue and summarize what is known regarding existing community groups, local organizations, local institutions, and locally–developed institutional designs that could serve as leaders and early adopters of the mainstreaming


Window Four | 129

and integration efforts pursued under both the PNPM Roadmap and new regulations concerning village finances and governances (RUU Desa). Existing data, including data from Local Level Institutions 3, additional field research, and additional applied analysis will all be included in the review. Inclusion Evaluations: Gender and Empowerment: The PSF will support an evaluation of the Program for Women Headed Households in Indonesia (PEKKA) by assisting PEKKA with analysis of available datasets to determine the program’s quantitative impact and with the preparation of a program of associated qualitative work to understand what is behind PEKKA successes and challenges. Given the complex and widespread nature of the capacity challenge in local research organizations and think–tanks, the team will work together with other development partners (such as the AusAID Knowledge Sector Initiative and the World Bank Poverty Team) to develop a more comprehensive capacity building strategy that will leverage the strength of each institution to improve the efficiency and effectiveness of the overall initiatives/strategy.

Lessons learned It is important to have a stronger dissemination strategy for the knowledge products produced by the PSF. The team has found that, despite conducting formal workshops and presentations to report on the results of evaluations and studies to the Government, JMC, and other interested partners, many key partners and decision makers are still not sufficiently informed or aware of the results of these evaluations and studies. The team has found that when findings are communicated to the right partners and decision makers, they were highly valued and immediately used as a basis to improve programs and/or future strategy decisions. Hence, a multi–pronged strategy for disseminating evaluation/study findings is critical to improve usage of PSF knowledge products by key partners. This strategy should include formal workshops; publication of final study reports; publication of bulletin–type summaries/digests of main evaluations; informal meetings/BBLs with different partners to share specific findings based on their interests/needs; and the use of social media to promote findings.

A sub–district facilitator presents a financial report at a public accountability meeting.


130 | 2012 PSF PROGRESS REPORT

Key Results

Result Indicators

Baseline

Total Target

Targets 2011

2012

2013

2014

2015

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To provide stakeholders with empirical data regarding the results and impact of PNPM Mandiri; research in greater depth special topics of concern to PNPM and the social development field in Indonesia; and enhance the ability of Indonesian social science research organizations to conduct M&E and special studies Findings/ evidence from 2010–2011 round of evaluations reviewed as part of PNPM Roadmap process

NA

Findings/ evidence from 2010–2011 round of evaluations presented to PNPM Roadmap Pokja and used in PNPM Roadmap Action Plans

NA

Findings/ Findings/ evidence from evidence 2010–2011 from round of 2010–2011 evaluations round of presented evaluations to PNPM used in Roadmap preparing Pokja PNPM Roadmap Action Plans

Findings/ evidence from 2010–2011 round of evaluations presented to PNPM Roadmap Pokja

On target

Revised Results Framework (RF) and associated program of evaluation for PNPM Rural V

NA

RF completed and endorsed by PMD; strategy for PNPM V evaluation finalized

NA

RF completed and endorsed by PMD; concept/ strategy for PNPM V evaluation finalized

Concept Evaluations Reports RF notes for completed; endorsed by completed evaluations results Government and completed; shared with and endorsed field works stakeholders published by PMD; concept/ started strategy for PNPM V evaluation finalized

On target

# of studies completed as part of the 2009–2011 round of evaluations

0

9

7

9

NA

NA

NA

9

On target

New 2012 studies launched (LLI3; gender; ComMgt; EIRR+; Papua)

0

6

NA

6

NA

NA

NA

6

On target

% of ongoing studies involving Indonesian research institutions

0%

100%

100%

100%

100%

100%

100%

100%

On track

Strategy for the capacity– building of Indonesian research institutions endorsed by JMC

NA

Concept note/ strategy reviewed, finalized and endorsed by JMC

Draft finalized

Concept note/strategy reviewed, finalized and endorsed by JMC

Capacity building plan conducted

Capacity building plan conducted

Capacity building plan conducted

Draft ready and shared with PREM to develop joint– strategy

On track (will be linked with AusAID Knowledge Sector Initiative)

NA

NA


Window Four | 131

Local Governance Capacity Development Project (LGCD) Summary Information Status

Active—Proposal for Phase 2 will be submitted to the JMC in 2013

Task Team Leader

Sonja Litz (slitz@worldbank.org) Hans Antlov (hantlov@worldbank.org)

Executing Agency

PSF

Start Date to Closing Date

18 October 2010 to 30 June 2013

Geographic Coverage

Stock–taking and analytical studies conducted in 25 districts P3BM training for officials from 9 provinces and 30 districts

Approved Budget

US$1.43 million

Project Rationale and Overview Indonesia has embarked on a radical and rapid decentralization program, involving the devolution of much of the responsibility for the delivery of public services to the local level. As a result of this devolution, local governments now manage around half of spending on basic public services. The process of decentralization creates opportunities to increase the efficiency of spending and to increase the level of participation in decision making by local constituents. In turn, this creates a possibility for local planning and service delivery to better reflect the priorities of these constituents and to enable citizens to exercise oversight in the delivery process, contributing to improved accountability. While there have been some gains from decentralization in terms of regional accountability and efficiency, the transition towards decentralization remains incomplete. The capacity of district governments to provide equitable and accessible services and the ability of poor people to engage with processes of local governance still vary considerably across regions. Linking community–driven development (CDD) processes to broader reforms and capacity development across the whole of village government will be a key factor in making PNPM itself sustainable. Although it is beyond a CDD program’s remit to be responsible for the strengthening of the planning and budgeting

processes at the local government level or for improvements to high–level sector coordination, there are a number of areas where social analysis and experimentation can inform these processes. For example, they may inform the testing of the means by which social capital and community–driven mechanisms for downward accountability can be mobilized for effective and inclusive planning and budgeting and to create stronger incentives for local government accountability through experiments with mechanisms to reward local performance. The Local Governance Capacity Development (LGCD) project was launched in 2010 to improve pro–poor planning and service delivery and to promote demand–side approaches to foster local government responsiveness to community demand. The project aims to improve the participatory planning process from communities up to the district level, focusing on improving pro–poor planning and budgeting and building better linkages between the community planning in PNPM and line agency service delivery. Through this program, it is hoped that improved responsiveness to community–level demand will strengthen local–level governance and improve service delivery, resulting in services that are less expensive, of better quality, and more responsive to local needs and preferences. The LGCD project focuses on analytical studies of lessons learned from various CDD programs and piloting of a toolkit for pro–poor planning, budgeting and monitoring (P3BM). These studies focused on the capacity of local government officials in key competency areas, the link between community needs and planning processes, the barriers and impediments to local governments’ delivery of good–quality public services to communities, and the interaction between PNPM and regular development planning.

Progress in 2012 The project published four studies on lessons learned from CDD interventions18, which can be found on the PSF’s website (http://www.pnpm–support. org/LG–analytical–study). Three draft policy notes19 were

18 (a) Stocktaking study of development planning, downwards accountability and local government capacity; (b) Lessons learned study of SPADA development planning; (c) Lesson learned study of P2SPP development planning: and (d) P3BM Impact Assessment. 19 On (a) the use of social accountability tools to improve service delivery; (b) how demand–side governance could be used make planning more pro– poor; and (d) support for empowered and inclusive communities and village governments as prerequisites for demand–side governance.


132 | 2012 PSF PROGRESS REPORT

A capacity building session for volunteer community mobilizers in Labang, Bangkalan on the island of Madura, East Java.

compiled into a single report on ‘Improving Public Services and Local Government Responsiveness through Accountability and Community Engagement’ and used as input into a paper on ‘Village and Sub–District Functions in Decentralized Indonesia’, available through the same website. These reports, which formulate a set of policy recommendations on how local government service delivery can be made more responsive and accountable, have served as a foundation for future work.

the integration of PNPM with local government. The LGCD project contributed to the PNPM Roadmap by leveraging the demand created by PNPM for improved service delivery outside of the project, holding government to account for how they use public funds and encouraging local government to increase contributions to poverty alleviation and community development.

Based on the findings of the evaluation of the P3BM pilot completed in 2011, which showed the overall effectiveness of the toolkit in supporting local government to achieve better targeting in their planning and budgeting documents, the JMC approved the scale–up of the P3BM project (discussed earlier in the report under Window 2).

Building on the lessons learned from LGCD, work is currently under preparation to scale–up identified best practices related to social accountability approaches (soft incentives) to improve local government responsiveness to community demand. This includes means for mainstreaming PNPM principles of community empower­ ment and pro–poor and participatory planning into existing planning and service delivery mechanisms at the local level.

Future Plans

During 2012, the LGCD team provided policy and operational input to government and civil society organizations on the draft village law (RUU Desa) and the PNPM Roadmap, specifically issues related to

The Government’s forthcoming village law (RUU Desa) may create new opportunities for building the capacity of


Window Four | 133

village governments on the basis of community–driven development, resulting in an increased flows of funds and ensuring that mechanisms of accountability are established. At present, various drafts of the law create both risks and opportunities. For example, a consolidated discretionary block grant at the village level has been proposed. At the same time, some drafts significantly limit the role of institutions that traditionally ensure accountability within the village. While the law may be approved in 2013, it is unlikely to be implemented until 2015. It is necessary to factor in the significant impact of this law on strategic planning for PNPM beyond 2014. The Local Governance Team will thus continue to provide policy advice on the RUU Desa, as well as the PNPM Roadmap, based on results from the various projects under its portfolio (LGCD, Village Training Program, Community Facilitators Development Project and the Pro–poor Planning, Budgeting and Monitoring Project).

Lessons Learned There are opportunities for piloting a range of social accountability reforms and for modifying the incentive structure: Demand–side governance, including downwards accountability and access to information, is taking root among civil society and some local governments. Some district governments have responded positively and are supporting community–identified needs using CDD approaches. Increasingly, integration of PNPM practices into regular government operations is starting to occur. However, there are few institutionalized mechanisms for citizens to hold government actors to account. PNPM practices can act as a catalyst for improvement of these processes. Through the social capital it creates, PNPM is well placed to mobilize community demand to create stronger incentives and improved accountability: Existing practices and positive experiences from PNPM could be a starting point for broader experiments with demand–side interventions in regular local government affairs, leveraging PNPM’s community mobilization efforts to incentivize the performance of service units, providing the space in which government actually meets with communities, and where citizens can hold government officials to account.

The demand–side approach of PNPM needs to be complemented by developing supply–side capacity and by incentivizing performance, specifically by stimulating and aggregating the demand for good governance: A new generation of donor projects is focusing on improving service delivery and addressing incentives. After working on planning and budgeting for many years without much breakthrough, new projects rather try to ensure that allocated resources are used responsively, and that spaces for social accountability, access to information and civil society–based monitoring are available. This includes ensuring the district–level accountability and oversight institutions (regional planning agencies, district legislatures, regional poverty alleviation teams) can trigger improved service delivery. When local–level reforms are implemented, improved performance is commonly the result of a combination of public entrepreneurship, civil society activism and a tweaking of the incentive structure: A major contributor to success is the presence of cross–cutting coalitions that link civil society actors, communities, media, and researchers with public sector champions. Reform–minded government officials can thus support community–driven development approaches and find improve service performance if they are backed by civil society action groups and are provided with recognition and public support. These multi–stakeholder groups have proven effective in bridging communication gaps between key stakeholders.


134 | 2012 PSF PROGRESS REPORT

Key Results

Result Indicators

Baseline

Total Target

Targets Before 2011 2011 2012

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To improve pro–poor planning and service delivery and pilot social accountability approaches to foster local government responsiveness to community demand. # of policy notes disseminated

0

4 policy notes

0

3

4

5

+1

# of provinces that establish P3BM clinics

0

2 clinics established

0

2

2

2

On target [2013– 2104 targets are reported by the P3BM project]

# of districts that use P3BM tool to monitor poverty data

0

5 districts use the P3BM tool

2

5

5

11

Plus 6 (Additional cycle of support in 2012)

# of studies on lessons learned from various CDD programs completed to support roll–out of good practices

0

3 studies completed

0

3

3

4

+1

# of participants in discussion of policy relevant findings

0

750 participants

100

750

750

710

Minus 40 (Delay in approval of Phase 2)

# of master national and provincial master trainers

0

125 trainers

25

125

125

152

Plus 27 (Additional training in 2012)

# of local government officials trained in P3BM toolkit

0

100 trainees

50

100

100

420

Plus 320 (Additional training in 2012)


Window Four | 135

PNPM Mandiri Revolving Loan Funds Capacity Building and Sustainability Project Summary Information: Status

Active

Task Team Leader

Yoko Doi (ydoi@worldbank.org)

Executing Agency

World Bank

Start Date to Closing Date

15 January 2010 to 31 December 2013 (Concept approved through 2014)

Geographic Coverage

Yogyakarta, Central Java, Nusa Tenggara Timur (NTT ) and West Sumatra

Approved Budget

US$ 8.9 million

Project Rationale and Overview The provision of access to micro–credit facilities, particularly micro–credit facilities accommodated through revolving loan funds (RLF), has been a significant component of a number of major Government poverty alleviation programs. The RLF components of PNPM and other programs are intended to provide small loans to poor people in rural and urban areas who want to start or improve businesses but who have no credit history and limited or no access to commercial loans provided by banks and other formal financial institutions, and thereby to contribute to the overarching goal of poverty reduction. The PNPM RLF operations have reached significant scale, with more than 460,000 groups, more than 4 million individual borrowers, and a total asset value in excess of US$750 million. While RLFs have contributed towards poverty alleviation and overall economic growth, a persistent criticism is that they have often been managed without consideration of microfinance best practices, creating an unsustainable source of cheap funds and unfair competition to commercial microfinance providers. An in–depth review of 508 RLF operations in the four pilot provinces showed that a significant proportion of RLFs have a record of a mixed or poor level of loan repayments. As a result, fewer funds are revolving to new borrowers and less interest is being collected to support operational costs. With this level of performance, the RLFs are not likely to attract external funding to support their growth and continued operation after Government funding ends.

Other identified issues include: (a) a failure to meet accepted practices for microcredit management and monitoring; (b) mixed levels of capacity and skills on the part of UPKs, including failure to separate the management of grants from that of loans; and (c) a lack of clarity regarding the legal status of RLFs. These issues reinforce the need to ensure that RLFs achieve sustainability. There is an inherently high potential risk of misuse and corruption, as well as a high potential for non–performing loans. In 2010, the Government decided to begin a gradual phasing out of the RLFs in their current form. In 2012, the Government signaled that it intended to explore the possibility of developing a rural economic empowerment program to complement or possibly replace RLFs that are being phased out. The PNPM Mandiri Revolving Loan Fund Capacity–Building and Sustainability project supports the capacity building, restructuring and institutionalization of the PNPM RLF scheme and aims to strengthen the linkages between RLFs and the commercial microfinance sector. By scaling up sustainable access to financial services to reach a larger proportion of the underserved population and by facilitating the development of microenterprises, the project is expected to contribute to poverty reduction and to improve livelihoods in areas where RLFs are implemented.

Progress in 2012 The RLF pilot continued to provide advisory support to both PNPM Rural and PNPM Urban. Results of the assessments conducted in 2011 and a possible strategy for the future development of RLFs were discussed with PNPM stakeholders, leading to the formulation of a number of policy decisions. For example, under the PNPM Rural 2012–2015 project, the Government has decided to implement measures to determine the level of financial health and sustainability of the RLFs and to provide clearer incentives for the collection of loans by requiring RLFs to post reserves for loans that may not be repaid. The pilot team has already field–tested the guidelines for the implementation of the proposed changes. There will also be increased focus on the recovery of outstanding loans. These steps are expected to facilitate a determination of performance–based allocations of additional grants to RLFs in 2013, as well as to identify RLFs eligible for further strengthening through capacity building. Throughout the year, the pilot team also continued to work with PNPM stakeholders to develop a simplified


136 | 2012 PSF PROGRESS REPORT

Meeting of members of a loans and savings group operated by PEKKA, the Female Headed Household Empowerment Program, in Lingsar, West Lombok, NTB.

rating system for introduction in 2013 to more easily assess the financial health of all RLFs. The RLF pilot team and other PSF teams are also working with PNPM to develop guidelines for audits of large RLFs, in particular for funds with a value of IDR 2 billion (US$210,526) or more. After further consultation to confirm the Government’s commitment to rolling out activities tested under the pilot, contracts were processed for three firms to carry out legal, MIS and capacity building activities under the pilot: zz A legal firm was contracted to conduct an initial gathering of data and to engage in stakeholder consultations at the national, provincial and local levels as part of its review of ownership issues and to determine a legal basis for the establishment of sustainable RLFs. The legal firm completed these tasks in 2012;

zz

zz

An MIS firm conducted a stakeholder analysis to determine the initial requirements for the development of the MIS at the national, provincial and local levels. In addition, consultations were conducted with BAPPENAS/SIMPADU and the firm responsible for the overall design of the PNPM Rural MIS to ensure the design of the RLF MIS enables its full integration into the overall PNPM system; and A capacity–building firm was also contracted to design and test prototype training modules and delivery mechanisms for RLFs. This firm will be mobilized in January 2013.

Future Plans There is an urgent need for the Government to define its approach to the RLF component of the PNPM program. The aforementioned activities provide a solid foundation


Window Four | 137

to develop a long–term strategy to ensure sustainable access to finance for poor communities. The Government has already taken important policy decisions to mitigate the fiduciary risks associated with RLF operations, but there is an urgent need for Government to formulate a means for achieving sustainability. The pilot will continue to work closely with PNPM stakeholders in a clinic mode to test capacity building and to develop and improve the RLF MIS platform. It will also continue to strive to facilitate linkages between RLFs and bank and non–bank financial institutions among selected RLFs to test a range of approaches. Following this testing, activities are expected to be rolled out by the Government to strengthen overall PNPM RLF operations. The pilot team will work to ensure close collaboration with PNPM stakeholders at all levels so that pilot activities remain relevant and the inputs these activities generate can be integrated quickly into ongoing RLF operations. Policy and strategy advice planned for the last stage of the pilot will continue on an ongoing basis for the RLF system overall. The pilot will help equip those involved in managing RLF activities to strengthen RLF operations and the economic empowerment of group borrowers. Strategies to facilitate the establishment of the MIS will be developed, with a final assessment report to be presented to stakeholders before testing and deployment to test sites later in 2013. The MIS firm will also train trainers for full rollout of the MIS by the Government in 2014. The MIS platform for RLFs will enable a higher level of data integrity and transparency, facilitate the rating of the performance of the RLFs, and reduce the reporting workload of the facilitators and UPK staff, as once the data is entered, the reports can be generated automatically for access at all levels. The legal firm will conduct consultation workshops with stakeholders in each province and in Jakarta. Findings and recommendations related to the legal issues surrounding the ownership of RLF funds and possible legal structures to improve the sustainability of RLFs will be presented at a national workshop for consideration by PNPM stakeholders. Handbooks will then be prepared as tools to enable PNPM stakeholders to establish the relevant legal structures. The capacity building firm will be mobilized and will consult extensively with PNPM stakeholders before designing and testing modules and delivery

mechanisms to strengthen RLF operations. The firm will also train a pool of certified trainers and master trainers to support the Government’s national rollout of tested capacity building modules to be integrated into the ongoing program. Up to 25 best practice UPK–RLFs will be identified to serve as resource centers to assist in the development of other UPKs. In 2013, the RLF rating system will be handed over to the Government for ongoing implementation. Once the RLF MIS is fully implemented by the Government, it will automatically generate the data for the financial aspects of the ratings. Stakeholder consultations will be conducted at the provincial and national levels to develop a linkage strategy. The PSF will continue to support the Government in testing linkage strategies in 2013–2014. An impact evaluation has been designed and will be carried out during 2013 and 2014. Approval to extend the project to December 2014 will be sought to support the Government during the rollout of the activities and to carry out impact evaluation activities.

Lessons learned PNPM revolving loan funds have not had the implementation and oversight mechanisms appropriate for the economic activities they support. As a result, RLF–related claims account for more than 70 percent of all complaints submitted through complaints handling mechanisms. Further, the in–depth assessment of RLF performance in four provinces revealed a number of weaknesses in RLF operations and systems, including: zz A widespread perception that loans provided by RLFs are effectively grants and subsidies erodes financial discipline and repayment levels in many RLFs; zz Although intended as community–owned assets, the legal basis for ownership of the RLF funds remains unclear. This acts as a constraint for RLFs to seek non–Government sources of funds for continued operations and growth after Government funding is phased out; zz Declining loan repayment rates and consequent increase in the level of non–performing loans further erode the sustainability of RLFs. At the time of the review, non–performing loans accounted for 23 percent of the loan portfolio for PNPM Rural and Urban in the pilot provinces; zz Weak management capacity in most RLFs indicated a need for strengthening, which was confirmed by a follow–up training needs assessment. Sub–district


138 | 2012 PSF PROGRESS REPORT

zz

capacity building support. A middle group of RLFs need to make significant efforts to improve performance, while a smaller number of RLFs are not sustainable.

facilitators and others involved in managing the RLF scheme need to be trained in matters related to the principles and practices of loan management and recovery and other areas essential to ensuring the sustainability of RLFs. Only about half of the RLFs assessed in the pilot provinces have realistic prospects of becoming sustainable operations, if provided with adequate

Key Results

Result Indicators

Targets Baseline

Total Target

2011

2012

2013 2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To support the capacity building, restructuring and institutionalization of the PNPM Revolving Loan Fund scheme and to strengthen linkages between the PNPMRLFs and the commercial microfinance sector so as to help ensure growth and sustainability in the provision of financial services to the poor. Percent To be increase in # extracted from and amount of 2011 baseline loans to groups/ data after members in determination supported RLFs. of RLFs to be supported by pilot.

Targets to be set in collaboration with PNPM during TA inception period when RLFs to be supported are decided.

––

––

TBD

TBD

Assessment of capacity building needs completed; capacity building TA contract signed; Baseline data collected from project MIS in 2011 for all RLFs in pilot provinces;

NA

# of supported UPK–RLFs with increased non– government financial resources.

To be set against December 2011 data for actual RLFs supported

Targets to be set after legal review and discussions with stakeholders.

––

––

TBD

TBD

Baseline data collected with mapping of 3,614 RLFs in pilot areas to determine existing linkages with bank and non–bank financial institutions; In–depth ‘good practice’ case studies drafted.

NA

# of UPKs with completed sustainability assessments

0

507

507

––

––

––

508 reports distributed in June 2012.

1

# supported UPK–RLFs that received high quality microfinance capacity building

0

Targets to be set in during TA inception period when RLFs to be supported are decided.

––

Inception report completed

TBD

TBD

Contract for TA firm signed.

Due to procurement delays, firm will mobilize in January 2013.

Percent of supported UPK–RLFs with regular, complete and timely performance rating results

0

100 percent in 2013

––

––

––

––

Simplified tool and guidelines developed for ongoing ratings; Independent ratings provided for a sample, tested on other RLFs. PNPM Rural framework established

Ratings are dependent on good MIS data. New RLF MIS will facilitate this in the future.


Window Four | 139

Indonesia Urban Poverty Analysis Summary Information Status

Active

Task Team Leader

Judy Baker (jbaker2@worldbank.org)

Executing Agency

World Bank

Start Date to Closing Date

21 October 2010 to 28 February 2013

Geographic Coverage

National, Urban Areas

Approved Budget

US$ 0.6 million

Project Rationale and Overview Like other developing countries throughout the world, Indonesia is steadily urbanizing. The proportion of the population living in cities has increased from 19.4 percent in 1975 to 30.9 percent (or 55 million people) in 1990 to 39.4 percent at the end of the millennium. Population projections indicate that urban dwellers will surpass their rural counterparts as a percentage of the population between 2010 and 2015, rising to a total of 60.7 percent by the year 2025 (or a total of 167 million out of a projected population of 276 million) (BPS Susenas data in ADB, 2001). How many poor people actually live in Jakarta and Indonesia’s other major cities depends, of course, on one’s definition of poverty. The truth is no one knows for sure. Indonesia has used varying—sometimes conflicting—

IMany of the urban poor live in slums where there are severe environmental and health hazards due to crowded living conditions.


140 | 2012 PSF PROGRESS REPORT

methodologies to measure poverty. In some cases, it is not clear that these methodologies draw an accurate, meaningful picture of poverty in the urban context, where the poor rely heavily on the cash economy and thus are more vulnerable to fluctuations in income than the rural poor, who may be able to supplement their household supplies with kitchen crops. In addition, there are severe environmental and health hazards due to crowded living conditions in urban slums, and no tenure security. Other multidimensional aspects of poverty relate to access to basic services such as water, sewage, health and education. Over the years, there have been periodic reviews and evaluations of PNPM Urban and other specific urban poverty programs. However, a comprehensive analysis of the overall situation of urban poverty in Indonesia is lacking. Also, a review of the effectiveness of government urban poverty programs in the context of changing conditions is needed. Much of the analysis related to urban poverty is dated, with relatively little known about the array of programs other than PNPM Urban aimed at the urban poor. While PNPM Urban has established a strong track record in executing community–level programs during its scaling–up, now that the program has reached nationwide coverage, there are a number of design issues that need to be addressed. The Indonesia Urban Poverty Analysis project is an important means by which the context in which PNPM Urban operates may be better understood. The goal of the Indonesia Urban Poverty Analysis project is to understand the PNPM Urban approach in the context of urban poverty in Indonesia today and to explore its strengths and weaknesses and its links with other urban poverty programs. Finally, it seeks to examine global experiences in urban community–driven development poverty interventions as possible inputs for the further development of the PNPM Urban program. The project consists of three core inter–related components: a An Urban Poverty Profile to understand the characteristics and dynamics of urban poverty in Indonesia today and to identify the needs of the urban poor; b A Review of Urban Poverty Programs to compile a master list of government programs aimed at poverty alleviation in urban areas and to conduct a comprehensive examination of the performance of these programs to understand how the program mix and targeting meets the needs of the urban poor;

c A Process Evaluation of the PNPM Urban Program to identify strengths and weaknesses of the program, especially in terms of governance and access to services, documenting good practices, and distilling lessons learned for program evolution in the future. Under this component, a rapid assessment of the pilot neighborhood upgrading scheme has also been carried out. The project began in December 2010, with the Rand Corporation being commissioned to conduct both the Urban Poverty Profile and Program Review and the PNPM Urban Process Evaluation. By the end of 2011, much of the planned analytical work under this project had been completed. The Rand Corporation had submitted drafts of the two studies. Key findings and recommendations had also been discussed with the Government, development partners, academia and NGOs during a workshop in Jakarta and joint mission in the field, and incorporated into the PNPM Urban 2012–2015 project design.

Progress in 2012 In 2012, the project team focused on ensuring the completion of the reports prepared by the Rand Corporation, including the inclusion of requested revisions.20 The team then proceeded to prepare two policy notes based on the studies’ findings.21 These were subjected to a World Bank–wide review, and were then finalized for dissemination and publication. Key findings and recommendations from these policy notes are included in the box below.

Future Plans The project closing date was extended by two months to 30 March 2013 to allow for the dissemination of key findings and policy recommendations to the Government, development partners and NGOs; for follow–up work with the Government on the development of an Urban Poverty Strategy; and for the PNPM Urban team to follow–up on the study findings and design changes.

20 see links http://psflibrary.org/web/?q=catalog&recid=6526 and http:// psflibrary.org/web/?q=catalog&recid=6525. 21 see links http://psflibrary.org/web/?q=catalog&recid=6527 and http:// psflibrary.org/web/?q=catalog&recid=6529 (both are in English version) and http://psflibrary.org/web/?q=catalog&recid=6528 and http://psflibrary.org/ web/?q=catalog&recid=6530 (both are in Bahasa version)


Key Findings and Recommendations from the Urban Poverty Profile and Program Review and the PNPM Urban Process Evaluation The urban poor in Indonesia have characteristics similar to the urban poor in other countries: they tend to have low levels of educational achievement, they work in the informal sector for low wages, they live in low quality housing, they lack tenure security, and they have less access to basic services than the non–poor. Sub–groups among the urban poor that are particularly vulnerable include recent urban migrants, child laborers, street children and those living in informal settlements. Approximately two–thirds of all of Indonesia’s urban poor live in Java, though the poverty rate in Nusa Tenggara is substantially higher. Focus group discussions conducted in a sample of poor urban communities across Indonesia identified a number of key challenges for residents. Those most frequently mentioned were inadequate incomes, difficulty in finding jobs, and expenses related to schooling. Other themes that came up were poor infrastructure and lack of capital. The Government has developed a comprehensive poverty reduction strategy with a number of large social assistance programs in addition to those under the PNPM umbrella. Key social assistance programs include the Raskin (‘poor rice’, from beras miskin) rice subsidy, the Jamkesmas health insurance program, a conditional cash transfer program for the extremely poor (PKH), and the Cash for Poor Students program (BSM). The overall package of programs aimed at the urban poor covers most basic needs, though there are substantial issues related to program design, efficiency and the quality of services being delivered which have emerged from this and other studies, particularly for the large Raskin and Jamkesmas programs.22 With regard to targeting, there is much scope for improved efficiency and reducing leakages to the non–poor. There are also problems related to under–coverage, particularly for the urban poor living in informal settlements, who despite probably being among the poorest urban dwellers, may be ineligible for some Government benefits due to a lack of personal documentation or for other causes. The PNPM Urban program23 was found to be an effective means of facilitating community participation and for the development of basic infrastructure at the community

23 evaluated in depth in a companion policy note, Indonesia, Evaluation of the Urban CDD Program, PNPM Urban (World Bank, 2012).

level. Independent assessments of infrastructure quality show it to be high, while community organizations are perceived to be working relatively well, independent of government programs and structures.

Policy Priorities Policy priorities can be categorized into two broad categories: (a) economic and urbanization policies; and (b) social policies. As Indonesia urbanizes, the proactive management of the urbanization process can leverage growth and facilitate poverty reduction. Policies that encourage efficient urban spatial structures, sustainable land use planning, investments in critical infrastructure, and the provision of basic services to benefit all urban dwellers, including those living in informal settlements, will foster growth and ultimately contribute to poverty reduction. Concomitantly, social assistance programs are needed to help poor households escape destitution and to reduce the likelihood that vulnerable households will fall into poverty. Implementing such policies is quite possible given the successes that Indonesia has achieved to date, but will require a proactive approach in order to effectively prepare for the urban transition. Looking ahead, as Indonesia continues to urbanize, there is enormous potential for shaping the urbanization process to facilitate equitable growth and poverty reduction. The country also has an opportunity to avoid the mistakes that other countries have made in neglecting to plan for new urban residents in a proactive way. This has led to the proliferation of sprawling slums on marginal lands and lacking basic services. Compared to proactive measures, the cost of retroactively upgrading such areas is substantially more expensive over the long term, leading to a high level of inefficiency. Recommended improvements to social programs will also result in benefits to the poor, ultimately enhancing their level of human capital and improving their living conditions and productivity over the long run, thus breaking the cycle of poverty. Such policy choices will require a sustained and focused effort, but Indonesia cannot afford to miss this opportunity.

22 See World Bank, 2012, Protecting Poor and Vulnerable Households in Indonesia, Jakarta, Indonesia.


142 | 2012 PSF PROGRESS REPORT

Options for the longer term role of the PNPM Urban As Indonesia urbanizes, the demand for land, basic infrastructure, housing, transport and social services at the community level will grow enormously. In the context of Indonesia’s urbanization, the PNPM Urban program has much potential to expand its role to further address urban poverty needs, in alignment with the Government poverty reduction strategy. The PNPM Urban program could be used as a platform to improve the targeting of social programs intended to benefit poor communities, work on spatial planning with communities could be expanded, or it could facilitate the provision of basic services to informal settlements which currently do not benefit from government programs. The continued introduction and evaluation of new programs and approaches under PNPM will allow for experimentation to meet the evolving needs of the urban poor.

In complex, highly dense, urban areas where needs are particularly high, comprehensive slum upgrading programs may be the most appropriate approach, particularly if a range of infrastructure needs exist or if resettlement is necessary. Sharing experiences with other countries through a program of knowledge exchange will also encourage new and innovative thinking for the future. Indonesia has the opportunity to learn from some of the mistakes of other countries that have failed to plan for new urban residents by taking proactive steps now to accommodate and prepare for its urban transformation.

Key Results

Result Indicators

Targets Baseline

Total Target

2011

2012

2013

2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To understand the PNPM Urban approach in the context of urban poverty in Indonesia today, its strengths and weaknesses and links to other urban poverty programs, and bring in global experiences in urban CDD–based poverty interventions. Incorporation of key recom­ mendations into the design of PNPM Urban

––

Recom­ Recom­ mendations mendations incorporated incorporated in design

PNPM Urban process evalu­ ation & Urban Poverty Analysis and Program Review com­ pleted

––

Reports Pub­ Draft submit­ Two Reports ted Published  lished

Key findings and recom­ mendations are disseminated

––

Dissemina­ tion com­ pleted

n/a

Dissemina­ Dissemi­ tion of key nation findings from of policy studies recommen­ dations to key stake­ holders

n/a

n/a

Recom­ On target—The mendations Project team incorporated continues to into the de­ follow–up on sign of PNPM findings & de­ Urban 4 sign changes with Govern­ ment/WB

n/a

n/a

The two reports were finalized & policy notes prepared for publication

Minor delays,— the policy note will be published in Q1/2013

n/a

n/a

Key findings were dis­ cussed with Government, development partners, academia & NGOs in 2011

Minor delays— Dissemination will take place in Q1/2013.


Window Four | 143

Technical Assistance for the Ministry of Disadvantaged Areas (KPDT) Summary Information Status

Active

Task Team Leader

Fabrizio Bresciani (fbresciani@worldbank.org)

Executing Agency

World Bank

Start Date to Closing Date

2 July 2012 to 2 July 2014

Geographic Coverage

National

Approved Budget

US$ 0.4 million

Project Rationale and Overview The core mandate of the Ministry of Disadvantaged Areas (KPDT ) is to provide support to lift disadvantaged, border, remote and post–conflict districts out of poverty and to increase the quality of human resources in these areas. This is achieved through KPDT’s inter–ministerial coordination and synchronization of programs in target areas, including the coordination of initiatives to improve education, health care, food security and infrastructure in disadvantaged areas. The purpose of this technical assistance project is: (a) to strengthen the capacity of KPDT’s human resources, particularly the management of development assistance, so that KPDT can optimally manage community empowerment programs in disadvantaged areas; (b) to propose bureaucratic reforms to strengthen KPDT’s internal governance; and (c) to improve KPDT’s coordination and facilitation capacity to achieve its mandate of lifting disadvantaged districts out of poverty. The project provides technical experts to build the capacity of KPDT in the areas of strategic planning, program preparation, institutional development and project monitoring, with a technical focus on rural livelihoods and local economic development. This 24–month project was approved by the PSF’s Joint Management Committee (JMC) in April 2012. The project was originally designed to strengthen the institutional

capacity of KPDT in the preparation of the Support for Poor and Disadvantaged Areas 2 (SPADA 2) project, which was intended to promote local economic development in disadvantaged areas. Following discussions with KPDT, the scope of the project was reviewed and broadened to include the provision of support for the development and management of KPDT’s systems in the areas of planning, programming, and achieving compliance with social and environmental safeguards. After the cancellation of SPADA 2 in September 2012, a re–evaluation and re–design of the project took place to assess the implications of the cancellation for the design and scope of the activities described in the work program approved by the JMC. KPDT has requested technical assistance to be provided to build KPDT’s capacities in the areas of planning, programming and policy analysis. In addition, KPDT has requested the inclusion of an assessment of the performance of KPDT’s Prioritized District Products (Prukab) and Accelerated Rural Area Development (Bedah Desa)24 programs.

Progress in 2012 The recruitment of consultants for this project was completed in August 2012, although following the cancellation of SPADA 2, they have not yet been mobilized. A rapid mapping and assessment of Government and donor programs operating in KPDT areas began with a series of meetings within KPDT and with local governments. Technical assistance focused on the provision of assistance to KPDT to effectively draw lessons from its existing projects, particularly Bedah Desa, Prukab and the two SPADA projects. This included the implementation of an impact study; the formulation of lessons learned from the handover of SPADA assets to local governments; and capacity building in the area of the preparation of project reports. KPDT has begun to synthesize lessons learned and is preparing a publication on the achievements of these projects. Lessons from the use of SPADA block grants have already been incorporated into the Bedah Desa design, using SPADA operational procedures.

24 Bedah Desa or ‘Accelerated Rural Area Development Program’ used a CDD approach to provide integrated support to community groups for economic development. Prukab, or Produk Unggulan Kabupaten, ‘Prioritized District Products’, provides block grants to producer associations to support a prioritized commodity. Both these projects started in 2010 and are funded directly by APBN.


144 | 2012 PSF PROGRESS REPORT

A rural community on Sentarum Lake, Kapuas Hulu, West Kalimantan. With limited or no access to road networks, members of this and other similar communities are often particularly disadvantaged.

Discussions between KPDT and the World Bank on the design and implementation of a nationwide SPADA 2 Project were initiated in 2011 and continued through 2012, with the focus of the proposed project being on local economic development. The project concept for SPADA 2 was approved in June 2012. However, project preparations were cancelled in September 2012 when the project was not included in a revision of the Government’s lending plan for World Bank–funded projects for 2013. Since that point, this technical assistance project has been on hold. A series of meetings with KPDT deputies and PSF staff is planned for early 2013 to discuss

possible revisions to the results framework and work plan. The results of these discussions will be communicated to the JMC for its endorsement.

Key Results As mentioned above, the PSF and KPDT are considering revisions to the project’s results key indicators and targets following the Government’s decision to discontinue SPADA 2. The indicators listed below are indicative, and new targets have not yet been defined.


Window Four | 145

Key Results Result Indicators

Unit of Measure

Baseline

Total Target

Targets 2011 2012 2013 2014

Progress as of Dec 31, 2012

Difference with cumulative target for 2012

Development Objective: To help the Ministry for Disadvantaged Areas (KPDT) to improve the quality of project development and delivery in disadvantaged areas under Cluster 2 of the Government’s poverty reduction strategy. Improvements to KPDT’s policy framework for disadvantaged areas as a result of the project

Qualitative review.

n/a

TBC

n/a

TBC

TBC

TBC

0

n/a. A qualitative review will be conducted at project end.

Design Qualitative improvements for review key programs made as a result of the project

n/a

TBC

n/a

TBC

TBC

TBC

Lessons from SPADA block grants have been incorporated into the Bedah Desa design.

n/a

# of programs receiving TA for preparations

# of manuals

n/a

TBC

n/a

1

TBC

TBC

1

TA provided to SPADA 2, but the program was cancelled

# of mapping/ assessment of programs operating in KPDT areas

# of mappings

n/a

TBC

n/a

1

TBC

TBC

1

On target

# & type of trainings conducted for KPDT staff

# of trainings

n/a

TBC

n/a

TBC

TBC

TBC

0

n/a

# & type of SOPs & technical manuals developed

# of trainings

n/a

TBC

n/a

TBC

TBC

TBC

0

n/a


147

ANNEX 1: FINANCIAL OVERVIEW In 2012, the PSF continued to increase the financial and technical resources made available to Indonesian institutions to support their poverty reduction efforts through the PNPM programs. Donor partners pledged an additional US$53 million and the Joint Management Committee (JMC) approved US$85 million in new commitments. The share of funding directly executed by Indonesian institutions continued to increase from 65 percent in 2011 to 80 percent by the end of 2012.

all levels of government, strengthening management systems and producing high quality analytical work to support decision makers, and in engaging civil society organizations concerned with inclusive poverty reduction to leverage their more specialized, intensive approach to complement PNPM.

PLEDGES AND CONTRIBUTIONS TO THE PSF

The bulk of PSF commitments (73 percent) are being delivered by the Government through PNPM special programs that improve the poor’s access to health and education services; engage villagers in the conservation of fragile ecosystems; or provide communities affected by disasters or crisis with emergency assistance. The rest are being invested in sustaining the building blocks of PNPM, including building capacity across

Pledges to PSF reached a value of almost US$ 301 million in 2012, with receipt of cash contributions reaching US$259 million. The value of projects approved by the JMC exceeded these resources, however, resulting in an unfunded mandate of approximately US$5.8 million at the end of 2012. A number of important projects, which have been designed to support Roadmap implementation, thus remain unfunded and have been put on hold until additional funding is secured.

Figure 26. Share of funding by executing agencies

Figure 27. Donor’s contributions (US$ million)

259

7% NGO

CY Contributions Cumulative Contribution

20%

207

131

WB

90 23 23

73% GOI

2008

76

41

52

18 2009

2010

2011

2012


148 | 2012 PSF PROGRESS REPORT

COMMITMENTS

DISBURSEMENTS

With the realization of the project pipeline and topping up of existing activities, commitments grew from US$220 million at the end of 201125 to US$305 million at the end of 2012. Almost 80 percent of the new commitments were for two installments totaling over US$68 million to complement Government investments in scaling up PNPM Generasi coverage to approximately 500 poor sub–districts. These installments fulfilled the US$105 million pledge from the PSF to support PNPM Generasi over the period from 2010 to 2014. An additional US$12 million was approved under Windows Two and Four to expand the implementation support provided to the Government or to pilot innovative approaches such as PNPM Justice, Creative Communities, Village Training and the Pro–Poor Planning and Budgeting projects to further empower local communities and institutions as part of the Roadmap process. Window Three, which engages Indonesian CSOs to reach the most marginalized, was further consolidated with an additional installment of US$5.5 million for PNPM Peduli and the approval of a new project to support Disabled People Organizations.

A total of US$181 million has been disbursed since 2008 out of the received contributions of US$259 million.26 In terms of disbursements, 2011 was an outlier, with the total value of disbursements reaching US$89 million27 because the Post–Crisis Support project disbursed almost US$31 million during that year alone. Disbursements remained strong across all four windows in 2012, however, with a total of US$59 million disbursed during the calendar year. Volumes would have indeed been very similar to last year’s if not for the Post–Crisis project (US$55 million in 2011 against US$57 million in 2012). Of the disbursement target for 2012 (US$69 million), 85 percent was realized, corresponding to a disbursement ratio28 of 60 percent, slightly below the ideal disbursement performance benchmark of 70 percent used by the PSF Secretariat.

25 The 2011 PSF Report and Financial Statement reported US$194.68 million in approved commitments because the PNPM Urban in Aceh and Nias fund (US$24.81 million), although it had been approved by the JMC in 2011, had not yet been activated in the World Bank’s accounting systems. A US$ 0.95 million commitment for a previous phase of the CFDP project was also omitted.

26 These funds have been transferred to—but not necessarily fully utilized by— PSF grant recipients. Unused funds are returned to the PSF within six months after project closing. 27 The 2011 PSF Report and Financial Statement reported only US$66.35 million for CY2011 disbursements, because only the utilized portion (US$12.3 million) of the US$30.61 million which had been effectively disbursed by the Post– Crisis Support project in 2011 was included. A review of the 2011 statement also showed that disbursements made in 2009–10 (US$ 0.95 million) by a previous phase of the CFDP project had been omitted from the cumulative disbursement figure for 2011. The value of cumulative disbursements as of December 2011 for the M&E and LGCD also needed minor corrections to match the Bank’s online accounting records. 28 Disbursed within the Year/Undisbursed Commitments at Year Start.

Figure 28. Approved commitments (US$ million)

Figure 29. Total disbursement (US$ million)

181 305 122 220

90 37

42

2008

2009

36 2

2010

2011

2012

2008

9 2009

2010

2011

2012


ANNEX 1: FINANCIAL OVERVIEW | 149

Window One, which provides direct budget support to Government special programs, disbursed US$39 million. Both the Post–Crisis Support and PNPM Green trust funds under this window closed in December 2012, while the Disaster Support trust funds, which have almost fully disbursed, were extended for a year to allow for the completion and handover of disaster recovery activities in Merapi and Mentawai. Disbursements under Window One should increase in 2013 (with a projected value of US$55 million), even though there will be fewer active projects. PNPM Generasi expects to disburse US$44 million in 2013, while the commitment of US$23.5 million for PNPM Urban in Aceh and Nias, whose inclusion in the Government’s Green Book was delayed in 2012, should be fully disbursed during the 2013–14 period. Window Two, which provides coordination and supervisory support to the Government, disbursed approximately US$10 million in 2012, compared to US$5 million last year. This doubling of resources responded to the increased need for implementation support to accelerate progress on PNPM governance reforms and to assist PNPM Roadmap preparations. This level of investment should be maintained or even increased in 2013 to support Roadmap implementation.

Figure 30. Disbursements Performance (US$ million) Undisbursed Commitments at Year Start Disbursed Within the Year

34

Window 4, which provides technical assistance and M&E services to PNPM, disbursed slightly less in 2012 than in 2011 (US$ 5.5 million against US$ 7.5 million). The PNPM Rural and Generasi impact evaluations and most of the associated studies were indeed completed in 2011. In 2012, the focus was on completing the final reports, supporting thematic reviews to inform the PNPM Roadmap and launching new studies under the 2012–2014 round of evaluations. Disbursements should increase in 2013 with the implementation of this new round of studies.

Figure 31. CY 13 Projections vs CY 12 Actual disbursement (US$ million)

99

55

86

54 36

Disbursements under Window Three more than tripled, with US$4.9 million in 2012 compared to US$1.4 million in 2011. All three Executing Organizations under PNPM Peduli performed satisfactorily, but the number of CSO partners will be slightly reduced in 2013 to consolidate the portfolio of sub–projects under Phase Two of the program, which will begin in mid–2013. The new Disabled People Organizations project will start disbursing in 2013.

CY 12 Actual Disbursement CY 13 Disbursement Plan

59

39

28 10

14 5

7 2009

10

2010

2011

2012

WINDOW ONE: Support to Special Programs

WINDOW TWO: Micro Coordination and Supervisory Support

3

WINDOW THREE: PNPM and Civil Society (On-granting to Indonesian Civil Society)

6

WINDOW FOUR: Technical Assistance to PNPM Mandiri


150 | 2012 PSF PROGRESS REPORT

ANNEX 2: PSF FINANCIAL STATEMENT AT END 2012 MILLIONS OF US$ RECEIPTS (ACTUAL)

2008

2009

2010

2011

2012

Government of Netherlands

14.67

4.50

0.83

11.90

31.90

Government of Australia

6.20

3.14

14.89

34.09

50.34

108.66

Government of Denmark

2.07

4.54

4.27

4.23

15.12

5.63

2.31

7.93

Government of United Kingdom

Total

European Union

3.35

1.35

1.26

5.97

Government of The United States of America

64.70

24.81

89.51

SUB–TOTAL

22.95

17.81

90.35

76.38

51.60

259.09

0.44

0.40

0.34

0.18

0.35

1.71

SUB–TOTAL

23.39

18.21

90.69

76.56

51.94

260.79

0.24

0.18

0.91

0.76

0.50

2.59

TOTAL

23.15

18.03

89.78

75.80

51.44

258.20

OPERATIONAL SUMMARY (CUMULATIVE)

2008

2009

2010

2011

2012

Approved Commitments

37.39

42.25

90.27

220.44

305.36

1.84

8.52

36.20

121.84

181.16

35.56

33.73

54.07

98.60

124.19

Investment Income Administration Fee (1%)

Disbursements Undisbursed trust funds and grants


151

WINDOW ONE: SUPPORT TO SPECIAL PROGRAMS

2008

2009

2010

2011

2012

Approved Commitments

16.00

16.00

44.25

156.88

222.22

16.00

16.00

34.05

34.05

34.00

2 PNPM Generasi (Community CCT ) Scale–up

1 PNPM Green/Renewable Energy

10.20

38.32

73.32

3 Global Financial Crisis Supplement (GFCS) for PNPM Rural (AF)

32.70

32.70

0.20

0.20

4 PSF Disaster Mgt Support—PNPM Rural (Grant Amount: US$14,100,000) 4.1 PSF Disaster Mgt Support—PNPM Rural (MDTF TF070967) 4.2 PSF Disaster Mgt Support—PNPM Rural (USAID TF071562) 5 PSF Disaster Mgt Support—PNPM Urban

13.90

13.90

1.40

1.40

6 PSF Disaster Mgt Support—Rekompak (Grant Amount: US$11,500,000) 6.1 PSF Disaster Mgt Support—Rekompak (MDTF TF070967)

0.40

0.40

6.2 PSF Disaster Mgt Support—Rekompak (USAID TF071562)

11.10

11.10

7 PNPM Urban in Aceh/Nias

24.81

23.50

8 PNPM Generasi (Community CCT ) Scale–up

31.70

1.60

19.39

91.27

130.26

Disbursements 1 PNPM Green/Renewable Energy

1.60

9.19

16.00

31.68

2 PNPM Generasi (Community CCT ) Scale–up

10.20

32.84

42.34

3 Global Financial Crisis Supplement (GFCS) for PNPM Rural (AF)

30.61

32.70

4 PSF Disaster Mgt Support—PNPM Rural (Grant Amount: US$14,100,000) 4.1 PSF Disaster Mgt Support—PNPM Rural (MDTF TF070967) 4.2 PSF Disaster Mgt Support—PNPM Rural (USAID TF071562) 5 PSF Disaster Mgt Support—PNPM Urban

5.87

11.55

0.70

1.35

6 PSF Disaster Mgt Support—Rekompak (Grant Amount: US$11,500,000) 6.1 PSF Disaster Mgt Support—Rekompak (MDTF TF070967)

0.40

0.40

6.2 PSF Disaster Mgt Support—Rekompak (USAID TF071562)

4.85

10.25

7 PNPM Urban in Aceh/Nias

8 PNPM Generasi (Community CCT ) Scale–up

16.00

14.40

24.86

65.61

91.96

Undisbursed Funds

16.00

14.40

24.86

18.05

2.32

2 PNPM Generasi (Community CCT ) Scale–up

1 PNPM Green/Renewable Energy

5.48

30.98

3 Global Financial Crisis Supplement (GFCS) for PNPM Rural (AF)

2.09

0.20

0.20

4 PSF Disaster Mgt Support—PNPM Rural (Grant Amount: US$14,100,000) 4.1 PSF Disaster Mgt Support—PNPM Rural (MDTF TF070967) 4.2 PSF Disaster Mgt Support—PNPM Rural (USAID TF071562) 5 PSF Disaster Mgt Support—PNPM Urban

8.03

2.35

0.70

0.05

6 PSF Disaster Mgt Support—Rekompak (Grant Amount: US$11,500,000) 6.1 PSF Disaster Mgt Support—Rekompak (MDTF TF070967)

6.2 PSF Disaster Mgt Support—Rekompak (USAID TF071562)

6.25

0.85

7 PNPM Urban in Aceh/Nias

24.81

23.50

8 PNPM Generasi (Community CCT ) Scale–up

31.70


152 | 2012 PSF PROGRESS REPORT

WINDOW TWO: MICRO COORDINATION AND SUPERVISORY SUPPORT

2008

2009

2010

2011

2012

Approved Commitments

11.95

12.90

19.37

30.31

36.34

1 PSF Secretariat/Operations Support

3.65

3.65

5.35

5.35

6.59

2 Socialization/Dissemination: Communication Strategy

2.00

2.00

2.50

4.35

4.35

3 PNPM Supervision & Monitoring (Rural)

4.00

4.00

6.00

6.15

5.12

4 PNPM Field Team Operations (Rural)

1.50

2.53

5 PNPM Supervision & Monitoring (Urban)

0.50

0.80

0.80

6 MIS/Info Management: Integrated MIS for PNPM Mandiri (Simpadu II)

0.98

0.98

0.98

2.30

2.30

2.30

2.30

2.30

8 TA Support to Bappenas and Pokja Pengendali PNPM (Kesra)

1.66

1.66

9 USAID Program Mgt and Administration

2.89

2.89

7 Green PNPM Env. Awareness: Pilot Project

10 PNPM RESPEK: Barefoot Engineers Training Wave III

1.75

1.75

11 PNPM Community Facilitator Devt Program, Phase III (Approved 7/25/2011)

1.19

1.19

12 National Community Empowerment Program In Urban Areas For 2012–2014 Supervision

0.35

13 PNPM Green Awareness Raising Project

0.27

14 Creative Communities II (BETF)

0.27

15 Village Training Program (BETF)

0.40

16 Pro–Poor Planning and Budgeting

1.67

17 Creative Communities II (RETF)

0.61

18 Village Training Program (RETF)

1.25

19 PNPM Community Facilitator Devt Program

0.95

0.95

0.95

0.95

20 Training of Local Auditor (Inspektorat Kota/Kab) in PNPM Mandiri Perkotaan 2010

0.30

0.30

0.29

21 USAID Supervision and Operational

0.15

0.15

22 Policy Workshop Disbursements 1 PSF Secretariat/Operations Support

0.50

0.92

3.21

8.05

12.87

22.78

0.60

1.56

2.98

4.62

5.49

2 Socialization/Dissemination: Communication Strategy

0.11

0.35

1.26

1.90

2.68

3 PNPM Supervision & Monitoring (Rural)

0.22

1.29

2.65

4.09

5.19

4 PNPM Field Team Operations (Rural)

0.15

1.89

5 PNPM Supervision & Monitoring (Urban)

0.22

0.59

0.78

6 MIS/Info Management: Integrated MIS for PNPM Mandiri (Simpadu II)

0.10

0.30

7 Green PNPM Env. Awareness: Pilot Project

1.84

8 TA Support to Bappenas and Pokja Pengendali PNPM (Kesra)

0.11

0.89

0.03

0.63

10 PNPM RESPEK: Barefoot Engineers Training Wave III

9 USAID Program Mgt and Administration

1.18

11 PNPM Community Facilitator Devt Program, Phase III (Approved 7/25/2011)

0.19

12 National Community Empowerment Program In Urban Areas For 2012–2014 Supervision

13 PNPM Green Awareness Raising Project

0.27

14 Creative Communities II (BETF)

0.07

15 Village Training Program (BETF)

16 Pro–Poor Planning and Budgeting

17 Creative Communities II (RETF)

18 Village Training Program (RETF)

19 PNPM Community Facilitator Devt Program

0.01

0.95

0.95

0.95

20 Training of Local Auditor (Inspektorat Kota/Kab) in PNPM Mandiri Perkotaan 2010

0.29

0.29

21 USAID Supervision and Operational

0.05

0.15

22 Policy Workshop


ANNEX 2: PSF FINANCIAL STATEMENT AT END 2012 | 153

Undisbursed Funds 1 PSF Secretariat/Operations Support

11.03

9.68

10.82

17.44

13.56

3.05

2.09

2.37

0.72

1.09

2 Socialization/Dissemination: Communication Strategy

1.89

1.65

1.24

2.45

1.67

3 PNPM Supervision & Monitoring (Rural)

3.78

2.71

3.35

2.06

(0.07)

4 PNPM Field Team Operations (Rural)

1.35

0.64

5 PNPM Supervision & Monitoring (Urban)

0.28

0.21

0.02

6 MIS/Info Management: Integrated MIS for PNPM Mandiri (Simpadu II)

0.98

0.88

0.67

2.30

2.30

2.30

2.30

0.46

1.55

0.77

7 Green PNPM Env. Awareness: Pilot Project 8 TA Support to Bappenas and Pokja Pengendali PNPM (Kesra) 9 USAID Program Mgt and Administration

2.86

2.26

10 PNPM RESPEK: Barefoot Engineers Training Wave III

1.75

0.57

11 PNPM Community Facilitator Devt Program, Phase III (Approved 7/25/2011)

1.19

1.00

12 National Community Empowerment Program In Urban Areas For 2012–2014 Supervision

0.35

13 PNPM Green Awareness Raising Project

14 Creative Communities II (BETF)

0.20

15 Village Training Program (BETF)

0.39

16 Pro–Poor Planning and Budgeting

1.67

17 Creative Communities II (RETF)

0.61

18 Village Training Program (RETF)

1.25

19 PNPM Community Facilitator Devt Program

0.94

20 Training of Local Auditor (Inspektorat Kota/Kab) in PNPM Mandiri Perkotaan 2010

0.30

0.01

21 USAID Supervision and Operational

0.10

22 Policy Workshop

0.50


154 | 2012 PSF PROGRESS REPORT

WINDOW THREE: PNPM AND CIVIL SOCIETY (ON–GRANTING TO INDONESIAN CIVIL SOCIETY) Approved Commitments

2008

2009

2010

2011

2012 11.52

4.22

4.27

1 PNPM Window 3—PNPM Peduli Phase II

0.35

1.56

2 PNPM Peduli Executing Organization: Lakpesdam

0.87

1.52

3 PNPM Peduli Executing Organization: Kemitraan

1.56

2.73

4 PNPM Peduli Executing Organization: ACE (Assoc for Community Empowerment)

1.28

1.97

5.1 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (RETF)

1.25

5.2 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (BETF)

0.55

5 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs

6 PNPM Window 3 Phase I—PNPM Peduli (Capacity of Philanthropy)

4.00

1.77

7 PNPM Window 3—PNPM Peduli Phase I

0.22

0.22

0.17

0.05

1.43

6.34

Disbursements 1 PNPM Window 3—PNPM Peduli Phase II

0.06

0.67

2 PNPM Peduli Executing Organization: Lakpesdam

0.16

1.42

3 PNPM Peduli Executing Organization: Kemitraan

0.75

2.12

4 PNPM Peduli Executing Organization: ACE (Assoc for Community Empowerment)

0.29

1.97

5.1 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (RETF)

5.2 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (BETF)

5 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs

6 PNPM Window 3 Phase I—PNPM Peduli (Capacity of Philanthropy)

7 PNPM Window 3—PNPM Peduli Phase I

0.05

0.17

0.17

4.17

2.84

5.18

Undisbursed Funds 1 PNPM Window 3—PNPM Peduli Phase II

0.29

0.89

2 PNPM Peduli Executing Organization: Lakpesdam

0.70

0.10

3 PNPM Peduli Executing Organization: Kemitraan

0.81

0.62

4 PNPM Peduli Executing Organization: ACE (Assoc for Community Empowerment)

0.99

5.1 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (RETF)

1.25

5.2 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs (BETF)

0.55

6 PNPM Window 3 Phase I—PNPM Peduli (Capacity of Philanthropy)

4.00

1.77

7 PNPM Window 3—PNPM Peduli Phase I

0.17

0.05

5 Supporting Disabled People Organizations (DPOs) to Promote Inclusion within Indonesian Poverty Reduction Programs


ANNEX 2: PSF FINANCIAL STATEMENT AT END 2012 | 155

WINDOW FOUR: TECHNICAL ASSISTANCE TO PNPM MANDIRI Approved Commitments

2008

2009

2010

2011

2012

9.44

13.35

22.44

28.97

35.28

1 TA for PNPM Generasi—CCT

1.25

3.16

4.41

4.41

4.41

2 PNPM M&E, Special Studies (Incl. Infras Census for Ind villages)

5.00

5.00

6.56

9.66

9.66

3 PNPM Green/Renewable Energy ( TA)

2.25

2.25

2.25

1.00

0.74

4.21

8.89

8.89

4 Micro Finance Development: PNPM Revolving Loan Fund (RLF) Cap. Bldg. 5 Local Government Capacity Development ( Training of Loc Gov’t)

1.43

1.43

1.43

6 ID Urban Pov Analysis, Program Review and Urban Evaluation

0.64

0.64

0.64

7 National Community Empowerment Program In Urban Areas For 2012–2014 BETF for Technical Assistance

0.96

8 Technical Assistant to KPDT

0.41

9 Increasing Accountability Capacity in PNPM—PNPM Justice Services (RETF)

2.64

10 Increasing Accountability Capacity in PNPM—PNPM Justice Services (BETF)

1.32

11 PNPM Generasi (Community CCT ) Scale–up ( WB)

1.41

12 Delivering Services to Poor Community 13 Poverty Engagement, Knowledge & Action Prog. (total $9,156,171) Disbursements

0.94

0.94

0.94

0.94

0.77

2.00

2.00

2.00

2.00

0.92

3.70

8.71

16.26

21.78

1 TA for PNPM Generasi–CCT

0.62

1.77

2.80

3.11

3.90

2 PNPM M&E, Special Studies (Incl. Infras Census for Ind villages)

0.29

1.27

3.13

6.85

8.03

0.01

0.12

0.24

0.55

3 PNPM Green/Renewable Energy ( TA) 4 Micro Finance Development: PNPM Revolving Loan Fund (RLF) Cap. Bldg.

0.32

1.97

4.27

5 Local Government Capacity Development ( Training of Loc Gov’t)

0.00

0.95

1.54

6 ID Urban Pov Analysis, Program Review and Urban Evaluation

0.00

0.39

0.63

7 National Community Empowerment Program In Urban Areas For 2012–2014 BETF for Technical Assistance

0.09 0.02

8 Technical Assistant to KPDT

9 Increasing Accountability Capacity in PNPM—PNPM Justice Services (RETF)

10 Increasing Accountability Capacity in PNPM—PNPM Justice Services (BETF)

11 PNPM Generasi (Community CCT ) Scale–up ( WB) 12 Delivering Services to Poor Community 13 Poverty Engagement, Knowledge & Action Prog. (total $9,156,171) Undisbursed Funds 1 TA for PNPM Generasi–CCT

0.00

0.30

0.59

0.76

0.77

0.35

1.73

2.00

2.00

8.53

9.65

13.73

12.71

13.50

0.63

1.39

1.60

1.30

0.51

2 PNPM M&E, Special Studies (Incl. Infras Census for Ind villages)

4.71

3.73

3.43

2.81

1.63

3 PNPM Green/Renewable Energy ( TA)

2.25

2.24

2.13

0.76

0.19

4 Micro Finance Development: PNPM Revolving Loan Fund (RLF) Cap. Bldg.

3.89

6.92

4.62

5 Local Government Capacity Development ( Training of Loc Gov’t)

1.43

0.48

(0.11)

6 ID Urban Pov Analysis, Program Review and Urban Evaluation

0.64

0.25

0.01

7 National Community Empowerment Program In Urban Areas For 2012–2014 BETF for Technical Assistance

0.87

8 Technical Assistant to KPDT

0.40

9 Increasing Accountability Capacity in PNPM—PNPM Justice Services (RETF)

2.64

10 Increasing Accountability Capacity in PNPM—PNPM Justice Services (BETF)

1.32 1.41

11 PNPM Generasi (Community CCT ) Scale–up ( WB) 12 Delivering Services to Poor Community 13 Poverty Engagement, Knowledge & Action Prog. (total $9,156,171)

0.94

0.64

0.35

0.19

1.65

0.27


156 | 2012 PSF PROGRESS REPORT

ANNEX THREE: SUMMARIES OF MAJOR ANALY TICAL WORK CONDUCTED IN 2009–2011 AND IN 2012 Table 5: Completed Evaluations/Studies from 2009–2011

Evaluations/Studies 1 PNPM Rural Impact Evaluation 2007: http://pnpm– support.org/data/pdf/ pnpm–evaluations/2008/ PNPMRuralBaselineReport.pdf 2010: http://psflibrary. org/catalog/repository/ PNPM+IE+Final+REVISED%20 done.pdf 2 PNPM Rural Qualitative Impact Evaluation 2007: http://psflibrary. org/catalog/repository/ Kecamatan%20 development%20 program%20qualitative%20 impact%20evaluation.pdf

Methodology

Main Findings

Quantitative • Real per capita consumption gains of 9.1 percent for (propensity score households in PNPM Rural areas; matching); baseline • The gains were higher for poor households and poor sub– 2007; end line 2010 districts (11.8 percent and 12.7 percent respectively); • Households in PNPM areas were 2.1 percent more likely to move out of poverty; • Access to health services increased 5.1 percent for households in PNPM areas.

Qualitative, multi– years (2007 and 2010)

• Participation, transparency and accountability were strong within the program, especially at the sub–district and village levels; • PNPM Rural is most effective at reducing poverty and impacting poor households when the needs of the poor are aligned with those of the community.

3 PNPM Rural Marginalized Groups Study http://psflibrary.org/catalog/ repository/PNPM%20 Marginalized_english.pdf

Qualitative (2010)

• Marginalized groups have limited participation in PNPM Rural meetings, which are still dominated by elites and interest groups; • Although facilitation/project procedures have often led to increased participation rates, it has not encouraged active or influential participation by marginalized groups in the development of proposals; • Officials and leaders of interest groups (religious and traditional elites) still possess the greatest influence over which proposals are developed and selected, therefore reducing opportunities for marginalized groups to impact decision–making on the use of project resources.

4 Village Capacity in Maintaining Infrastructure Study: Evidence from Rural Indonesia http://pnpm–support. org/data/pdf/pnpm– evaluations/2010/VRRI_ English_FINAL.pdf

Quantitative (repeated surveys every quarter in a year to capture cyclical income fluctuation, 2010)

• Many communities still found it difficult to maintain existing infrastructure projects; • The cost of maintaining infrastructure was up to 2.8 percent of a household’s total consumption—although small, this is likely burdensome for poor households; • Although villagers are willing to pay for the maintenance of infrastructure, the amount communities are willing to pay does not cover all infrastructure maintenance needs; • The community’s willingness to pay is strongly influenced by the direct impact of the infrastructure on individual households and institutional responsiveness in terms of complaint handling.

2010: http://pnpm–support. org/sites/default/files/ Impact_PNPM%20Rural_ Qualitative%20Study_2010. pdf


157

Evaluations/Studies

Methodology

Main Findings

Quantitative (randomized control trial, baseline 2007, end line 2010)

• Statistically significant positive impact on average across all 12 indicators that Generasi was designed to address; • The strongest improvements among the health indicators were in the frequency of weight checks for young children; • The improvement in education indicators was most notable in the increased school participation rate among the primary school–age group; • In terms of long–term impact, there was about 10 percent decrease in malnutrition compared with control areas.

Qualitative, multi– years (2007, 2010)

• Communities, village elite, and service providers considered PNPM Generasi more beneficial to maternal child health (MCH) and basic education than other programs—it offered wide variety of aid, accessible to almost everyone, and could complement other existing programs; • PNPM Generasi contributed to increased utilization of MCH services through subsidized costs for delivery, transport for pre– and post–natal checks, supplementary foods, and transport to visit health posts; • PNPM Generasi also contributed to a lower level of school dropouts and absenteeism at primary/junior high through provision of various supports (uniform, transport, school equipment, etc.) to lessen the economic burden of the parents.

7 PNPM RESPEK Infrastructure and Community Organization Capacity Evaluation http://pnpm–support.org/ sites/all/sites/default/ files/Final%20Respek_edit%20 done.pdf

Mixed–methods (2011)

• All infrastructure samples evaluated are of good to moderate quality—a significant achievement, considering huge implementation challenges in Papua and West Papua; • 67 percent of the infrastructure built was utilized by the community; • PNPM RESPEK improved administrative capacity of local facilitators but not the facilitation capability.

8 PEKKA Baseline Survey

Quantitative (2011)

• Female headed households (HH) have lower subjective welfare, bleaker view of their future, and negative mental state; • No differences between female and male headed HHs in terms of per capita expenditure, access to financial services and government social assistance, and assets; • Female–headed households have lower per capita income but the differences disappear after controlling for age and education. This difference persists for the poorest sub– population.

9 Perception of Local Governance Study http://psflibrary.org/catalog/ repository/Governance%20 Review%20of%20PNPM%20 Rural%202012.pdf

Qualitative (2010)

• Local governments generally perceived PNPM (Rural and Urban) as programs with very high participation rate, better transparency and stronger accountability mechanism compared to other programs; • Participation is the principle that is most readily adopted by local governments for their own programs. Transparency and accountability, however, are not yet being adopted by most local governments; • Most respondents believed that to improve the sustainability and long–term impact of PNPM on poverty reduction, the programs should focus on building the capacity of the community through training, education and mentoring.

5 PNPM Generasi Impact Evaluation 2007: http://pnpm– support.org/data/pdf/ pnpm–evaluations/2008/ Conditionalcash transferinIndonesia PKHandPNPMgenerasi.pdf 2010: http://psflibrary.org/ catalog/repository/PNPM%20 Generasi%20Final%20 Impact%20Evaluation%20 Report%202011.pdf 6 PNPM Generasi Qualitative Evaluation http://pnpm–support. org/data/pdf/pnpm– evaluations/2008/ Qualitativebaselinestudyfor PNPMGenerasiandPKH.pdf http://pnpm–support.org/ sites/default/files/ PNPMGenerasiQualitative ImpactEvaluation%20(1).pdf


158 | 2012 PSF PROGRESS REPORT

Table 6: Completed Studies/Evaluations in 2012

Evaluations/Studies

Methodology

Main Findings

1 Rapid Assessment of Women’s Participation in PNPM http://pnpm–support. org/sites/default/files/ PNPM%20Womens%20 Participation_2012_English_ FINAL%20SUBMITTED.pdf

Qualitative (2012)

• Quality of women’s participation was mixed in study areas and is still not maximized; • Women’s involvement in the project cycle is still low beyond the initial project stages of socialization and needs assessment; • Women’s proposals that are funded are usually infrastructure, rather than capacity building and trainings that are requested when the local actors do a more in–depth analysis of women’s needs; • Local initiatives and strategies around women’s participation existed but have yet to be integrated into more general local decision making processes.

2 Local Level Governance Review

Qualitative/Action Research (2012)

• The state of local governance in PNPM is mixed: it is still remarkably strong, but faces problems; • Participation rates are still mostly high, but the quality of participation has declined in some places; • There are weaknesses in transparency and information sharing: performance of accountability mechanisms in the program varies and the incidence of serious corruption is up; • Despite this, the foundations of PNPM are still strong. These foundations, though, are being eroded by serious pressure from higher–up problems related to the broader governance environment, changes in the program design, and problems with implementation and management; • PNPM must address these program design, implementation and management issues to avoid undoing its years of good work at the community level.

3 Rate of Return Analysis (EIRR) of PNPM Rural Infrastructure Sub– Projects http://pnpm–support.org/ sites/default/files/Final%20 Report–%20Small%20 Scale%20Study–PNPM.pdf

Quantitative (economic analysis), small scale study in 20 villages assessing 48 sub–projects using similar methodology as in 2005 exercise

• Similar to the 2005 results ( Torrens, 2005), the EIRR varied among sub–projects with median value of 30–50 percent; • The average general income multiplier is 1.3; • Sub–projects are generally 25–30 percent cheaper than projects built using typical local government contractors.

4 Village Infrastructure Census http://psflibrary.org/catalog/ repository/PODES%20 Infrastructure%20Census%20 2011.pdf

Quantitative (village • Comprehensive data on basic infrastructure availability and level census)— quality (including health and education facilities) in nearly all piggybacking urban and rural villages in Indonesia (over 76,000 villages); PODES 2011 • A consistent picture of geographic variation in the supply of basic infrastructure across Indonesia. In general, provinces on the island of Java and the province of Bali perform best, while local needs for investment still exist in these regions, particularly in the provinces of West Java and Banten; • The largest gaps in infrastructure supply readiness are found in the Papua region, the Maluku islands, NTT, and in the interior of Kalimantan; • Data has been used to create a supply readiness index for health and education (to support PNPM Generasi in location selection/targeting); • Further analysis will be conducted to calculate financing gaps (pending data availability on costs) and to provide more information for PNPM Rural in terms of location selection and allocation of block–grants.


2012 PSF Progress Report  

PSF Annual report

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