Indonesia, a middle-income country, has had difficulty providing universal access to education and adequate access to healthcare, particularly in poor and rural areas. While national government programs have been effective in raising primary school enrollment, other health and education indicators still lag, and huge geographical disparities remain. In 2007, the year that the government embarked on its sweeping antipoverty programs, maternal mortality was 228 per 100,000 live births, among the worst in Southeast Asia, while close to 20 percent of children under the age of five were underweight. Other surveys found that enrollment rates dropped precipitously between primary and middle schools, going from 94 percent to 65 percent.
To tackle these problems, the Government of Indonesia launched two large-scale programs in 2007. The first, called the Hopeful Family Program, known as PKH, provides conditional cash transfers to extremely poor households with children or pregnant women and is linked to use of health services and enrolling children in school. The second poverty alleviation program, known as the National Community Empowerment Program—Healthy and Smart Generation, or PNPM Generasi, was the one that SIEF evaluated. This program gives block grants to poor, rural communities, enabling communities and local health and education providers to work together to decide what needs to be done to increase schooling and use of critical health services.
The Generasi program was initially focused on rural areas in five provinces chosen by the government. The evaluation was structured to measure the impact of providing villages just with block grants, not tied to any performance measures, and with linking a portion of the second and subsequent years to performance measures. In total, more than 2,100 villages were randomized to receive either the incentivized or non-incentivized version of the Generasi program, covering about 1.8 million target beneficiaries, while some 1,000 villages served as the control group. The block grant was set at about US$10,000 a year, and this amount has risen over time. The baseline survey was conducted from June to August 2007, prior to implementation; the first follow-up survey, was conducted from October to December 2008, about 18 months after the program began; and the second follow-up survey was conducted from October 2009 to January 2010, about 30 months after the program began. Approximately 12,000 households were interviewed in each survey wave, as well as more than 8,000 village officials and health and education providers.
The impact evaluation built into the program found that after 18 months, cash incentives based on the performance of the village in achieving specific health measurements led to better health outcomes, particularly in poorer areas of the village that had initially shown worse performance. Weight checks for children increased. More pregnant women took iron supplements obtained at antenatal care visits.
Partly based on the results after the program had been running for about18 months, the Government of Indonesia decided to expand the pilot to three additional provinces, focus on using performance-linked grants after the first year, and to emphasize interventions that curbed stunting, which were highly successful in the pilot project.
In a follow-up evaluation of data after 30 months, the difference between treatment and control villages had basically disappeared, because control villages caught up to those that were receiving the grants. However, the program has continued.