New Naratif’s Citizen’s Agenda Survey invited more than 1,400 people from all over Indonesia to voice their aspirations. “Poverty and Precarity” consistently ranked as the most important issue. What are the challenges for the upcoming Indonesian government in handling this issue, and what can we do to monitor their performance?

Since 17 August 2023, New Naratif has been carrying out The Citizen’s Agenda Indonesia to find out the most important issues facing the country in anticipation of the 2024 General Elections. The results of Stage 1 of our research mapped out 22 of the most important issues raised consistently across the board. In Stage 2, we asked the public to rank the issues according to priority. Now, in Stage 3, we try to understand how the political system in Indonesia responds to these issues.

Without exception, the most pressing issue across the political spectrum was Poverty and Precarity. In this article, we will examine economic trends of poverty and precarity in Indonesia in the last two decades, the responses from candidates, and criticisms from our colleagues at The Conversation Indonesia. We will also observe the lessons learned from BPJS Employment presented by several analyses from The Conversation Indonesia, and conclude with what we as members of civil society can do to improve the issue of poverty and precarity in Indonesia.

Economic Trends Relating to Poverty and Precarity in Indonesia

To outside observers, the intensity of concern over poverty in Indonesia may seem unique. After all, it was only last year that Indonesia managed to re-enter the Upper Middle Income Country category from the World Bank after slipping down during the 2020 pandemic. Indonesia’s growth rate has also returned to its above 5% pre-pandemic standard, far above the world average at 3.1% in 2022.

Indonesia’s poverty rate has also continued to decline since 2012. Even though it exceeded 10% during the 2020 pandemic, poverty continues to decrease. In March 2023, approximately 25.9 million people were poor, which means 2.27 million people had been alleviated out of poverty in ten years.

Additionally, Indonesia’s economy for the past decade has shown success in closing wealth inequality, at least according to the available Gini Index data from the World Bank, i.e. a number that measures the distribution of income (and sometimes consumer expenditure) in a society. Even though the country’s economic recovery from the 2020 pandemic has turned its graph slightly upwards once more, the general trend still shows a decline.

That being said, it must be noted that at 37.9 (in 2022), Indonesia is the country with the third worst economic equality in Asia, only surpassed by Malaysia (41.2 in 2018) and the Philippines (40.7 in 2021). With this in mind, it is only natural for Indonesians to put the issue of Poverty and Precarity as their number one concern.

What do the Candidates Say?

New Naratif’s The Citizen’s Agenda programme also invites candidates to respond. Several legislative candidates have responded directly to New Naratif. Additionally, we look at Prabowo-Gibran’s programmes related to Poverty and Precarity in Indonesia.

Legislative Candidates’ Responses to New Naratif

Jumiasih, DPR Jakarta II legislative candidate from the Labour Party, believes that the main root of the issue of poverty is

[…] low wages leading to weak purchasing power. On the other hand, the government does not control the prices of goods and services on the market, so wage increases have had no impact.

— Jumiasih

The inadequacy of wages and price control is a recurring complaint brought up by the Labour Party. Additionally, Ilhamsyah, DPR Jakarta III legislative candidate from the Labour Party, has also been pushing for land redistribution to farmers, equal access to education and health, affordable housing, as well as providing access to capital for MSMEs.

Meanwhile, Kokok Dirgantoro, East Java DPR Legislative Candidate V from the Indonesian Solidarity Party (Partai Solidaritas Indonesia, PSI), believes that job creation, budget discipline, and worker protection are key to poverty alleviation.

Downstreaming of mining, agriculture, plantations, and maritime affairs will be the key to creating jobs, especially manufacturing and value-adding efforts to products/commodities. […] Social welfare budgeting must be sharpened, especially for poor and vulnerable groups […] [and] must run in parallel with the protection of workers (especially women and those with disabilities). These protections include freedom of association, equal employer-employee relationships, and protection from harassment/violence from home, at work, and when returning home.

— Kokok Dirgantoro

Prabowo-Gibran’s Programmes on Poverty and Precarity and Criticisms Thereof

Kokok Dirgantoro’s views are relatively in line with the programmes of Prabowo-Gibran’s regime, which include poverty alleviation as the fifth priority out of 17 Priority Programmes towards ‘Indonesia Emas 2045’ (Golden Indonesia 2045). Prabowo-Gibran targets reducing the absolute/extreme poverty rate to 0% in the first two years, and relative poverty to 5% in five years.

This five-year commitment is outlined more concretely in their 8 Fast Best Results Programme, which almost entirely focuses on alleviating poverty and social vulnerability, including access to quality health and education, in accordance with the responses of the legislative candidates above. These 8 programmes are:

1. Providing free lunch and milk at schools and Islamic boarding schools, as well as nutritional assistance for children under five and pregnant women.
2. Conducting free health checks, resolving tuberculosis cases, and building a well-equipped quality hospital in each district.
3. Increasing the productivity of agricultural land with village-level, regional, and national food storage initiatives.
4. Building integrated schools in each district and repairing schools that need renovation.
5. Continuing and adding social welfare programmes and small business licenses to eliminate absolute poverty.
6. Increasing the salaries of state civil servants (especially teachers, lecturers, health workers, and extension workers), as well as military, police, and state officials.
7. Continuing the development of village and sub-district infrastructure, direct cash assistance (BLT), and ensuring the provision of affordable, well-sanitized housing for those in need, especially the millennial generation, Generation Z, and low-income communities (MBR).
8. Establishing the State Revenue Agency to increase the ratio of state revenues to Gross Domestic Product (GDP) to 23%.

Whichever ideological faction they subscribe to, it seems that every political actor in Indonesia is aware of the importance of the issue of poverty alleviation and equal wealth distribution. Despite various criticisms of Prabowo’s track record, and analysis of the Jokowi effect on democracy in Indonesia, it cannot be denied that these eight programmes sound rather progressive and pro-poor.

However, several important points still need to be considered. The first programme, namely free lunch and milk, for example, has been the subject of criticism after Eddy Soeparno, Deputy Chair of the National Campaign Team for Prabowo-Gibran, stated that the program would be funded by cuts in fuel subsidies. Even though energy subsidies are considered mistargeted, cutting fuel subsidies for free lunches risks causing a spike in inflation.

Apart from the risk of inflation, our colleagues at The Conversation Indonesia have also conveyed several crucial concerns at hand. Regarding food sovereignty, for example, Jokowi’s food estate program is quite vulnerable to failure due to climate change. Regarding industrial downstreaming, the Prabowo-Gibran strategy requires scale in an expanding global market in a global economy that has been predicted to shrink by 5%.

More specifically, regarding the programs above, there are two important issues emphasized by our colleagues at The Conversation Indonesia. First, regarding the increase in salaries for state civil servants (especially teachers and lecturers),

“Prabowo-Gibran did not specify which aspects of welfare they wanted to improve— whether the certification allowance component, basic salary, other components, or by adding new components to the salary structure for educators. […] The welfare of teachers and lecturers themselves is not only related to salary, but also their well-being or happiness, old age security, and access to free time to increase professionalism without being burdened with too much administration. […] These programmes also tend to favour state civil servants with no consideration for private or honorary teachers.”

Second, related to the free lunch and milk programme in schools as well as nutritional assistance for children under five and pregnant women,

“This [top-down] approach is outdated. The collaboration aspect is not apparent. […] The target is also unclear, whether to overcome stunting, malnutrition, or other nutrition. They say it’s for stunting, but once a child has entered school it’s no longer counted in the first thousand days of life.”

— Ilham Akhsanu Ridlo, Public Health Expert, Airlangga University (quoted from The Conversation Indonesia)

The Conversation also added that Prabowo did not set a figure for reducing stunting in his written vision and mission document. In other words, this programme has the potential to be problematic in terms of both the fiscal approach to financing as well as the practical approach in its execution.

Details of their criticism along with other points in these 7 Crucial Issues can be read in their page at The Conversation Indonesia.

Lessons from Indonesia’s Employees’ Social Security System (BPJS Ketenagakerjaan)

Hence the questions that follow: How effectively will these programs be implemented? What are the challenges and threats we might face in the future?

To answer them, it is apt to look at the equality and social assistance programs currently being implemented. According to the data above, the performance of the Indonesian government in maintaining economic growth and reducing wealth inequality has shown plenty of positive indicators over the last ten years.

One of the factors of this success is the Employees’ Social Security System, which has also included Unemployment Benefits for the last two years. How successful are these programmes? Our colleagues at The Conversation Indonesia help us answer this question.

60% of Indonesian Workers are Excluded from the Employees’ Social Security System

Despite having proven its value, the Employees’ Social Security System still fails to protect workers in the informal sector. Meanwhile, over 60% of the workforce in Indonesia works in the informal sector. This means that the majority of workers in Indonesia do not have the protection offered by the Employees’ Social Security System. There are six reasons for this:

First, the informal sector is yet to be officially recognised, regulated, and protected by the government. The informal sector rarely has clear work agreements, business permits, and taxes. As a result, they are not covered by social protection programmes provided by the state.

Second, informal workers tend to have low and uncertain income. As a result, setting aside money to pay for social security is still not a priority for them.

Third, minimal awareness. Earning generally—though not always—low income, informal workers’ awareness of the importance of prioritising social security is also low.

Fourth, social security programmes tend to come with administrative requirements such as identity cards (KTP), taxpayer identification numbers (NPWP), and account numbers. Some even require the beneficiary to come directly to a branch office to fill out a registration form.

Fifth, physical mobility and transference of informal workers from one type of job to another is quite high because the sector is dependent on market demand. This affects, for example, project workers, porters, welders in shipyards, flag sellers popular every August, and seasonal traders during Ramadan and Idul Fitri.

Sixth, minimal socialisation. Considering the enormous benefits and fairly affordable contributions, socialising the programme to 80 million informal workers should be a priority for the Employees’ Social Security System.

Written by Yanu Endar Prasetyo, Triyono, Vera Bararah Barid, and Yanti Astrelina Purba, the article details these six problems and provides four recommendations for strategies for expanding the programme’s membership, which can be read in full on The Conversation Indonesia’s page.

Unemployment Benefits Show Low Claims

Three of the researchers above, Yanu Endar Prasetyo, Triyono, and Vera Bararah Barid, together with Ngadi and Devi Asiati, also revealed three main factors in the Unemployment Benefits scheme (Jaminan Kehilangan Pekerjaan, JKP) which explains its very low claims:

First, the political and public perception factor. The Unemployment Benefits scheme was born from the womb of the Omnibus Law, which, since it was first proposed, has received widespread rejection and resistance at the grassroots level. The public believes that this law, which aims to attract investment, ignores the protection of workers’ rights, including increasing the potential for layoffs. […] The findings of the National Research and Innovation Agency (BRIN) in 2022 in Bekasi and Batam—as representatives of industrial areas—reinforce this. Almost all trade/labour unions in the research area reject UU Ciptaker and firmly refuse to participate in socialising the benefits of the scheme to their members.

Second, the administrative factor. The Unemployment Benefits scheme is biased towards formal workers and can only be obtained by those whose employers (i.e. companies) are orderly and honest in paying their workers’ monthly contributions. Meanwhile, many cases in the field show that companies do not register their workers and are in arrears in their Employees’ Social Security System contributions. As a result, the employees of these companies cannot receive Unemployment Benefits if they are dismissed unilaterally.

Third, the literacy and technical capacity factor. The Unemployment Benefits scheme is quite comprehensive, including providing cash for six months, access to job market information, and job training. However, the lack of official outreach means that these various benefits are not widely known or recognised by the public. […] There has been no measurable and transparent evaluation to see whether these programmes really help layoff victims return to the workforce.

A more detailed analysis of the problem and five recommendations for a more effective implementation of the Unemployment Benefits scheme can be read in full on The Conversation Indonesia’s page.

Advocating for the Alleviation of Poverty and Precarity in Indonesia

The various analyses above prove how even programmes that are designed to be pro-poor really depend on three main factors: the government’s prejudice, literacy and socialisation, and public sentiment towards the regime. Even though most of us are in no position of sufficient power or influence to create programmes or policies that will have a major impact on alleviating poverty and precarity in Indonesia, this does not mean that we should stand idly by.

Instead, we can monitor the various programmes from the government—in the form of support or criticism—with the following four actions:

Monitoring the Government’s Prejudices as Reflected in its Administrative Approach and Practices

Even though various programmes for alleviating poverty and precarity may sound promising, we need to pay attention to the prejudices that may be inherent in these programmes. These prejudices are generally seen in the various administrative requirements and approaches used in its implementation, such as how much the government is willing to involve grassroots collaborators rather than simply dictating from above.

The bias of the Employees’ Social Security System and its Unemployment Benefits towards formal sector workers is a clear reflection of this, as well as how the welfare of state and civil servants are prioritised over private and honorary workers. This is not even touching upon issues of access for the disabled, women and other gender minorities, as well as other marginalised communities.

Despite the claims to partisanship stated in the government’s programme outlines and its vision and mission documents, its prejudices will come to light in the programmes’ approach and administration. As citizens, we have the right to monitor and criticise the implementation of government programmes to demand more inclusive bureaucratic and administrative reform.

Demanding Transparency and Literacy from All Parties as well as Adequate Socialisation

Even though socialisation is key to the success of a programme, it is no less important to demand literacy from all parties. As mentioned in the criticism levelled at several of the Prabowo-Gibran programmes mentioned above, sometimes the toughest challenge in implementing a programme is the lack of clarity on its goals. Workers’ salaries can be increased through various components and allowances, for example, while nutritional improvements can be focused on preventing stunting, preventing malnutrition, or a first 1000-days programme.

Each detail needs to be clearly communicated by all parties. Actors must have insight into the real needs of their target beneficiaries rather than simply starting from broad assumptions. On the other hand, beneficiaries must be given adequate information about the importance and benefits of these programmes. Finally, these programmes must be followed by measurable and transparent evaluations to monitor their effectiveness.

As citizens, we have the right to demand proof that all parties involved have received sufficient programme literacy, adequate socialisation about the focus and benefits of the programme, as well as proven effectiveness.

Swaying Public Confidence and Sentiment towards the Government

The success of a government programme depends heavily on public sentiment towards the ruling regime, in turn largely determined by current political conditions. The Unemployment Benefits scheme, for example, was born from the controversial Omnibus Law, which made people reluctant to learn more despite its potential value.

This of course does not mean that we immediately have to support government policies and create positive sentiments to help make government programmes successful. Instead, we must be more observant in monitoring them and the various components in their implementation. Less pro-poor programmes may contain progressive aspects defending certain rights. Likewise, some programmes may sound good on paper yet contain aspects detrimental to certain marginalised groups.

Winning a general election and maintaining positive public sentiment throughout an entire presidential term are two different things. With Prabowo’s controversial track record, we still have to see how far his programmes will receive support from civil society. What is clear is that we must always be observant in monitoring our government’s various policies in the future.

Enhancing the Strength of Civil Society

The success of programmes to alleviate poverty and precarity in Indonesia will be in vain without a healthy democracy. We have talked about monitoring and safeguarding programmes, conveying criticism, demanding bureaucratic and administrative reform, evaluation, transparency, and government accountability. Without good democratic processes—especially freedom of opinion and criticism—none of these actions will be possible to carry out effectively.

It is also very important to remember that programmes to alleviate poverty and precarity that rely on the government will always depend on the intentions and goodwill of state officials to carry them out. Corruption will always remain a problem in such programmes, which New Naratif shall discuss at another time. What is no less important to pay attention to is the potential for corrupt parties to hold hostage the sustainability of poverty alleviation programmes in certain areas, for example by stopping or reducing funding for a program if certain policies do not pass, or if certain politicians or parties fail to win regional elections.

Therefore, it is imperative that we continue strengthening our civil society. A strong civil society is the foundation of democracy that will protect us from various threats that can undermine our rights as a society.

Conclusion

The Citizens’ Agenda 2023/2024 reveals Poverty and Precarity as the most pressing issue in Indonesia. This issue is a structural one, heavily depending not only on government policy but also on world economic trends (which will influence market expansion and job opportunities) and climate change conditions (which will influence various energy and food sovereignty policies), as has been indicated above.

However, it is also an issue whose betterment no less depends on our actions as civil society. Monitoring and safeguarding government programmes, maintaining the freedom to express criticism, as well as demanding bureaucratic and administrative reform, evaluation and transparency, and government accountability are key factors in advocating for programmes and policies to alleviate poverty and precarity in Indonesia.

Directly or indirectly, alleviating poverty and precarity in Indonesia depends on whether civil society movements can create solidarity between classes. It is very likely that the 2024 General Elections will conclude without the need for a second round. However, the democratic process in Indonesia must be maintained and safeguarded every day. Our responsibilities as civil society go far beyond elections because ultimately, it is the health of our democracy that will determine where and on whom our fate depends.