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    Narae Choi

    Kevin Tomlinson

     In 2007, the Government of Indonesia decided to make community empowerment a pillar of its poverty reduction approach and set a target to have PNPM reach national coverage by 2014. In addition to reaching every village in Indonesia, Government set out to improve economic welfare through providing cost–effective infrastructure, strengthen community institutions and their capacity to formulate their own development plans, and demonstrate the impact community–driven development can have on poverty reduction. The Government has been largely successful and Indonesia has one of the most impressive community empowerment records in the world.

    PNPM has continued to evolve as a community empowerment and poverty alleviation program. Many of the principles and practices that have been tested over the past 15 years are now being integrated into mainstream local government development initiatives, providing a strong basis for the members of rural and urban communities to become the primary actors and drivers of local development, rather than merely being beneficiaries. An exciting development was passage of the new Village Law, which dramatically increases the role, responsibilities, power and level resources of Indonesia community institutions. Many of these community institutions have been introduced, piloted and strengthened through the PNPM program in the way that communities prioritize the allocation of resources. The PNPM Support Facility (PSF) and its partners have played a significant role in the development of community–based approaches and systems, and will continue to assist the Indonesian Government as it implements and builds upon the new law.

    This report summarizes the progress made in 2013 in the PNPM Core programs and across the PSF’s four operational windows. It also includes personal and professional reflections from a number of the key actors in the PNPM program as well as vignettes about program impacts in rural, urban, and remotes areas and efforts to enhance participation and to reach the marginalized.

    PSF Window One: Support to Special Programs enables Government to scale up successful projects and test new approaches by taking advantage of PNPM platform’s nationwide reach and ability to deliver an array of services. In 2013, three special programs were financed under this window: PNPM Generasi, PNPM Disaster Management and PNPM Urban in Aceh. Over the year, PNPM Generasi which is helping drive tangible results against the Millennium Development Goals, particularly in health and education, expanded its coverage to 369 sub–districts, and is on track to be implemented in 500 sub–districts in 2014. Going forward Government will address stunting through the project and accelerate efforts to address supply–side constraints to health and education outcomes. The Disaster Management Support project has helped rebuild houses, community infrastructure, and generate incomes in communities affected by natural disasters in Central Java, Yogyakarta and West Sumatra. The project was extended to complete sub–projects in Mentawai, West Sumatra. Many lessons have been learned through the project, including disbursement channel constraints and the importance of facilitator readiness and availability, and are being used to inform new and other disaster management and emergency response related initiatives. The PNPM Urban in Aceh project began providing training to local government agencies and prepared pilot activities to promote gender equality in Aceh.

    PSF Window Two: Implementation and Coordination Support finances activities to support PNPM’s oversight bodies and implementing agencies, with a focus on assisting the Government to strengthen program’s core management systems. Over the year, PSF field analysts reviewed more 550 sub–projects in 592 villages in 223 sub–districts across Indonesia. Fiduciary specialists partnered with Government to improve the robustness of PNPM’s fiduciary controls and focused on supporting the program’s governance framework. PNPM has increasingly benefitted from national and local government agencies involvement in the supervision process, with local governments having implemented numerous corrective actions to address implementation issues. Moving forward, increased attention will be supporting the Government in the development of implementation guidelines for the Village Law and helping to ensure the readiness of management and fiduciary systems.

    There are over 25,000 PNPM facilitators helping implement the program across Indonesia. Government’s ability to attract, retain, train and allocate facilitators is critical to the program’s success. The PSF continued to support efforts to improve the competencies and professional development of facilitators through the Communities Facilitators Development project, which helped established a nationally recognized facilitator certification program. In Tanah Papua, the Barefoot Engineers project continued to train high school graduates as engineers.

    PSF Secretariat continued to provide management and coordination to the Joint Management Committee. It helped strengthen the institutional sustainability of the PSF by: finalizing agreements with partners to extend the PSF until 2018; implementing many of the recommendations made in the 2012 Bappenas led performance review of the PSF; and facilitating the membership of the Millennium Challenge Account–Indonesia (MCA–I) and US$95 million pledge. In 2014, the Secretariat will focus implementing transition arrangements to welcome a managing contractor in 2015 to help the PSF expand its ability to meet increased demands for its services.

    PSF Window Three: On–granting to Indonesian Civil Society works with CSOs who are uniquely qualified to reach and work with marginalized groups and people, many of whom receive only limited or indirect benefits from government programs, including PNPM. The PSF supports two CSO projects: PNPM Peduli and the Disabled Peoples’ Organizations (DPOs). PNPM Peduli, after two years of project implementation, has helped marginalized groups gain more access to education, health and legal services and increased their capacity to form social networks which allow them to benefit. The DPO project is specifically intended to benefit people with physical and other disabilities. During 2013, the project strengthened the capacity of DPOs to plan and implement projects of their own and to provide input on policy.

    PSF Window Four: M&E and Special Studies aims to increase access to global experience and expertise in poverty reduction and community–driven development as well as the technical and financial resources for rigorous evidence gathering. Over the year, most of the activities under this window focused on research and analytical work to inform data–based policy making, which served as inputs for the further development and implementation of the PNPM Roadmap and the recently approved Village Law. Annex Three summarizes the major PSF–financed studies. Going forward, the PSF will work in closely with key stakeholders to identify analytical work with the strategic value to inform policy making and operational design, particularly with regard to the implementation of the Village Law. To address the challenges in finding qualified social research organizations in Indonesia to conduct evaluations and studies, a project to strengthen the capacity of Indonesian universities PSF undertake quantitative and qualitative social development research is planned.

    Looking forward to 2014, the PSF will continue to focus supporting the Government’s poverty reduction strategies through community empowerment approaches and the strengthening of local institutions, good governance and accountability, and better services for the poor. As the Village Law is rolled out, the PSF will align its portfolio with the needs of Government, with sharp and focused analytical and operational services