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    Publication Year:

    Niruban Balachandran

    Narae Choi

    Seven years into implementation, PNPM reached full maturity with its national coverage and arrived at a critical juncture with the approval of the Village Law in January 2014. The Government of Indonesia has been largely successful in positively impacting the lives of millions of people across the Indonesian archipelago by strengthening community institutions and their capacity to deliver cost-effective infrastructure and by enhancing their access to social services and economic opportunities. Over 80 international delegations from more than 30 countries around the world have so far visited Indonesia to learn about the power of community-driven development (CDD) to transform lives, as effectively demonstrated by PNPM. The promulgation of the new Village Law was also a strong validation of the success of PNPM, as it adopts a number of CDD approaches that have been developed through PNPM and furthermore mainstreams the approach into regular government development initiatives.

    The advent of policy changes associated with the Village Law and the inauguration of a newly-elected Government have made the year 2014 transformational for the program. During this year, PNPM’s institutional structures, human resources and physical assets started their transitions to the Village Law platform, raising a number of risks as well as opportunities. The PNPM Support Facility (PSF) and its partners have adapted to the changing environment through intensive dialogue and intensified teamwork with the Government, communities and other stakeholders, in order to keep running the existing program smoothly. Simultaneously, increased efforts have been made to support the preparation of the implementation of the Village Law in the way that the accomplishments of PNPM in building communities’ capacities, supporting livelihoods, championing good governance, and reducing poverty can continue. 

    This report presents the progress made in 2014 of the PNPM Core programs and those under the PSF’s four operational windows. With the transition to the implementation of the Village Law starting in early 2015, a number of projects supporting various aspects of PNPM came to a close during this year. The ongoing projects have made necessary adjustments to a new policy and institutional environment.

    PSF Window One: Support to Special Programs was designed to enable the 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 2014, three special programs were financed under this window: PNPM Generasi, PNPM Disaster Management and PNPM Urban in Aceh. By the end of 2014, PNPM Generasi’s coverage expanded to 5,400 villages in 499 sub-districts, benefiting 6.7 million people through the provision of incentivized community block grants to improve health and education outcomes. In 2014, the PSF has continued its implementation support to PNPM Generasi, particularly in 
    relation to Infant and Young Child Feeding (IYCF) and Early Childhood Education and Development (ECED) programs. The Disaster Management Support project closed in November 2014, after completing 63 sub-projects (out of 75) that had remained in Mentawai, the last project 
    location. With this, the project met its mandate of delivering emergency assistance through the PNPM system to Central Java, Yogyakarta and West Sumatra, affected by disasters in 2010. Following the preparation work in 2013, the PNPM Urban in Aceh project moved on to actual implementation of Gender Mainstreaming Program in Aceh (SELARAS) and the Sustainable Urban Livelihoods Pilot, carrying out community meetings and capacity-building activities. 

    PSF Window Two: Implementation and Coordination Support finances activities to support PNPM’s oversight bodies and implementing agencies, with a view to assist them to strengthen program’s core management systems. Implementation support continued in the form of technical guidance and supervision over PNPM Rural and other programs, through field-based monitoring and activities to improve governance and fiduciary 3
    systems. Over the year, PSF field analysts reviewed more than 510 sub-projects in 490 villages in 225 sub-districts across Indonesia. The PSF Secretariat provided intensified support to facilitate the coordination of the Joint Management Committee (JMC), amidst a wave of changes in the surrounding political, human-capital and institutional landscape in 2014. 
    The year also saw the closure of many projects that have contributed to improving critical aspects of PNPM. The Community Facilitators Development Project and the Barefoot Engineers training program, each respectively geared to equipping facilitators with professional 
    certification and filling the gap of technical facilitators in Tanah Papua, were completed with lessons to be learned for similar initiatives in future. PNPM Mandiri’s Integrated Management Information System (SIMPADU) managed the expanded scope of the project effectively by its closing in November 2014, receiving data from 18 out of 20 PNPM core and special programs and being installed in all 33 provinces.

    PSF Window Three: On-granting to Indonesian Civil Society works with civil society organizations (CSOs) who are uniquely qualified to reach and work with marginalized groups and people, many of whom receive only limited indirect benefits from government programs, including PNPM. In 2014, two CSO projects, PNPM Peduli and the Disabled Peoples’ Organizations (DPOs), closed under the management of the World Bank, with its oversight shifting to the Asia Foundation. PNPM Peduli has established a solid track record of improving social inclusion of 19,645 marginalized and socially-excluded people, such as religious minorities, transgender people, and indigenous populations through the capacity-building and on-granting of local civil society organizations. The DPO project, specifically intended to benefit people with physical and other disabilities, began wrapping up its final DPO Mapping report, the completion of a technical review, and the transfer of preliminary 
    disability inclusion work with PNPM Generasi to the task team. This year, the project focused on capacity-building of DPOs to represent Persons with Disabilities and to engage key stakeholders in promoting the latters’ inclusion in poverty reduction programs. 

    PSF Window Four: Monitoring and Evaluation (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. In 2014, the PSF Analytics team focused on the completion of ongoing PNPM-related research that commenced in the previous year, while initiating a number of new key evaluations/studies as an effort to support the implementation of the Village Law. Annex Three summarizes the major PSF-financed studies. In addition, in 2014 the Revolving Loan Funds (RLFs) Capacity-building and Sustainability program assisted the Government in strengthening RLFs by offering strategies to ensure their long-term growth, financial self-reliance, and sustainability. Lastly, the Technical Assistance to the State Ministry of Disadvantaged Areas (KPDT ), despite experiencing some challenges during the year, managed to deliver inputs geared to strengthening the ministry’s capacity in disadvantaged areas, as well as its programming and operational capacity, before closing at the end of 2014. 

    Looking forward to 2015, the PSF will intensify its efforts to smoothen the transition to the Village Law. In addition, the Facility will continue to adapt to the newly-appointed Cabinet structure and priorities, work with the recently-established Managing Contractor that was hired by the Australian Department of Foreign Affairs and Trade (DFAT ), complete major project deliverables, and closely cooperate with JMC members to ensure a successful year ahead.