Improving welfare through poverty alleviation and unemployment reduction is the main development priority. The issues of poverty and unemployment in Indonesia are, among others:
- Though 2.21 million lower than in 2007, the number of poor people in Indonesia is still 34.96 million or 15.42% of the Indonesian population (BPS, March 2008).
- Though 1.12 million lower than in 2007, the number of unemployed people in Indonesia is still 9.4 million or 8.46% of the total Indonesian workforce (BPS, February 2008).
- Access to health services, education, housing and settlement, infrastructure, financing/credit, and information for the poor is still limited.
- Slum areas and poor enclaves in urban areas are widespread.
Rural PNPM Mandiri is a core part of PNPM Mandiri and is developed from the Kecamatan Development Program (KDP) launched in 1998.
The Rural PNPM Mandiri overall objective is to reduce poverty and improve local-level governance in rural areas of Indonesia through the provision of investment resources to support productive proposals developed by communities, using a participatory planning process.
Community Block Grants (BLM) allocated to kecamatans ranges from IDR 1-3 billion per year, depending on the population in the kecamatan. The selection of activities is open except for items specifically excluded through the project’s negative list. In PNPM, district governments with lower fiscal capacities provide contributions of 20% of the kecamatan grant and those with higher fiscal capacity provide contribution 50% from their own budgetary resources.
KEY PRINCIPLES | ||
| Participation/Inclusion Community participation is emphasized, especially among the poor and women. Participation should be broad-based, through local decision-making by all villagers. Transparency Open Menu | Competition for Funds Decentralized Simple
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Until 2008, KDP / Rural PNPM Mandiri has funded more than 180,067 infrastructure, economic, and social activities across the country. Below is an illustrative list of investments:
- 40,371 kms. Of roads built or upgraded
- 9,047 bridges built or reconstructed
- 11.062 irrigation systems built
- 10,451 clean water supply units and 4,288 sanitation units built.
- For education, construction and renovation of 6,732 schools; provision of school equipment materials; 118,791 individual educational scholarships.
- For health, construction and renovation of 4,902 village health units and posts.
- 71,726 million workdays of paid short-term employment have been generated so far for more than 6,1 million men and women who participated in Rural PNPM Mandiri infrastructure construction projects.
- Roads, bridges, and jetties built by Rural PNPM Mandiri have resulted in new local businesses, and especially transportation services provided by both local residents and outsiders.
- More than 1,68 million people have established, or expanded small businesses with funds from Rural PNPM Mandiri microcredit activities.
- Low levels of corruption – Independent audits of Rural and Urban PNPM Mandiri performed by Moores Rowland found that less than 1% of village subprojects from both programs showed deviations.
Total funds allocation since 1998 until 2008:
US $ 1.221.03 million from World Bank loan and US $ 179.11 million grant from:
- Netherland (US $59.96 million)
- Multi Donor Trust Fund (US $ 78.20 million)
- Grant for Nias Islands Rehabilitation and Reconstruction Project (US $ 25.7 million)
- Grant for Green Rural PNPM (US $ 9.8 million)
- Grant for Smallholder Agribusiness Development Initiative (SADI) Project (US $ 4.4 million)
- and Grant for consultants (US $ 0.9 million).
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