2 Lo c a l S o lu t i o n s to P ov e r t y The core business of the Local Solutions to Poverty (LSP) Facility is supporting the effective leadership and management of the Government of Indonesia’s programs to improve the quality of life of Indonesians through local development solutions to poverty and inequality. Through LSP, development partners provide high-quality coordinated technical assistance as well as policy advice and targeted financial assistance to the Government. Printed in 2017 | This publication is a product of the Local Solutions to Poverty Facility LSP ANNUAL PROGRESS REPORT 2016 LO C A L SOLUT I ONS TO P O V ERT Y A n n ua l P r o g r e s s Report 2016 1 TA BLE OF CONTENTS Contents Figures Abbreviations Stories from the Field FIGURE 01 & Acronyms STORY 01 STORY 02 Theory of Change Sky Train Early Childhood Care PAG E 3 PAG E 1 0 PAG E 1 3 and Education PAG E 1 6 FIGURE 02 End-of-Facility Outcomes Executive PAG E 1 0 Summary FIGURE 03 Share of Funds Contributed PAG E 5 to LSP in 2016 PAG E 2 7 FIGURE 04 Tables MDTF Disbursement History TABLE 1 PAG E 2 8 Pledges and Contributions, 2008—16 FIGURE 05 PAG E 2 7 Summary of Completed and Expected Analytical Outputs TABLE 2 PAG E 3 1 Program Expenditures by Executing Agency (US$) STORY 03 PAG E 2 8 Village Maternal Health Post PAG E 1 7 Boxes BOX 01 Sustainability Annex PAG E 7 ANNEX 01 Financial Overview BOX 02 PAG E 2 7 Relevance PAG E 9 ANNEX 02 BOX 03 Ongoing and Planned Risk Management Evaluations PAG E 3 1 PAG E 2 4 LSP ANNUAL PROGRESS REPORT 2016 TABLE OF CONTENTS 2 01 Introduction PAG E 7 CHAPTER 1.1 Changes in the Operating Context PAG E 7 CHAPTER 1.2 Local Solutions to Poverty PAG E 8 CHAPTER 1.3 LSP’s Operational Framework PAG E 9 2.2.3 CHAPTER 2.4 Improving the skills of service providers Gender and Inclusion to enhance service quality PAG E 2 0 PAG E 1 5 02 CHAPTER 2.5 2.2.4 Innovation Institutional strengthening to support PAG E 2 1 service providers to address frontline service needs Progress Towards PAG E 1 5 Outcomes PAG E 1 2 CHAPTER 2.1 Outcome 1: Community Participation CHAPTER 2.3 Outcome 3: National Systems and Enabling Environment: Ability to Guide, Encourage and Support 03 in Local Solutions to Poverty Local Solutions to Poverty Key Challenges PAG E 1 8 PAG E 1 2 PAG E 2 2 2.3.1 CHAPTER 2.2 Increasing availability and quality Outcome 2: Sub-national Governance 04 of data and analytics and Capability: Ability to Plan and PAG E 1 8 Implement Local Solutions to Poverty PAG E 1 4 2.3.2 Increasing availability and quality of 2.2.1 support structures for implementation Enhancing local government capacity of local solutions to poverty Future Direction PAG E 1 4 PAG E 1 8 PAG E 2 5 2.2.2 2.3.3 Improving performance incentives Improving support from the and accountability mechanisms at the national government district and village levels PAG E 1 9 PAG E 1 4 LSP ANNUAL PROGRESS REPORT 2016 3 A BBR EV IAT ION S A N D ACRON YMS Abbreviations & Acronyms Bappenas Badan Perencanaan Pembangunan Nasional (National Development Planning Agency) BKN Badan Kepegawaian Negara (National Civil Servant Organization) BPKP Badan Pengawasan Keuangan dan Pembangunan (Finance and Development Supervisory Agency) BPD Badan Permusyawaratan Desa (Village Councils) BPS Badan Pusat Statistik (The Indonesian Central Bureau of Statistics) CDD Community-Driven Development DFAT Australian Government Department of Foreign Affairs and Trade DJPK Direktorat Jenderal Perimbangan Keuangan Kementerian Keuangan (Directorate General of Fiscal Balance) ECED Early Childhood Education and Development EOFO End-of-Facility Outcome IE Impact Evaluation JIT Just in Time Kemenko PMK Kementerian Koordinator Pembangunan Manusia dan Kebudayaan Republik Indonesia (Coordinating Ministry of Human Development and Culture) KemenPAN Kementerian Pendayagunaan Aparatur Negara dan Reformasi Birokrasi Republik Indonesia (Ministry of National State Apparatus) KOMPAK Kolaborasi Masyarakat dan Pelayanan Untuk Kesejahteraan (Governance for Growth) LSP Local Solutions to Poverty MDTF Multi-Donor Trust Fund M&E Monitoring and Evaluation MoEC Ministry of Education and Culture MoF Ministry of Finance MoHA Ministry of Home Affairs MoV Ministry of Villages, Disadvantaged Regions and Transmigration NGO Non-governmental Organization NTB Nusa Tenggara Barat (West Nusa Tenggara) PASA Programmatic Advisory Services and Analytics Permendagri Peraturan Menteri Dalam Negeri (Ministry of Home Affairs Regulation) PNPM Program Nasional Pemberdayaan Masyarakat (National Community Empowerment Program) Posyandu Pos Pelayanan Terpadu (Local Health Service Post) PSF PNPM Support Facility UPK Unit Pengelola Keuangan (Sub-district Financial Management Unit) VIP Village Innovation Program LSP ANNUAL PROGRESS REPORT 2016 4 LSP ANNUAL PROGRESS REPORT 2016 5 EXECU T IV E S U M M A RY Executive Summary Reducing poverty and inequality in a ize local actors to reduce poverty and inequality. This includes country as large and diverse as Indone- high-level policy dialogue with ministers, tapping into the World sia requires enabling citizens, villages, Bank’s global expertise as well as using national forums such local governments as well as the private as the regular Indonesia Economic Quarterly to raise media and sector to identify and implement local public awareness of national development priorities. Second, solutions to these problems. Basic ser- LSP supports the World Bank to provide policy and technical vices, which account for as much as one- advice to ministerial officials, including at the Ministries of third of inequality, are delivered locally. Finance, Planning, Home Affairs, Villages as well as Health and Local governments are responsible for Education. Third, enhanced implementation support assists most health and education services, and the Government to deliver complex and innovative operations, spend almost 50 percent of the state including the Village Innovation Program (VIP), Generasi, budget. The quality of this spending KIAT Guru, and the Early Childhood Education and Develop- is low, however. Experience from the ment (ECED) project. Finally, LSP co missions special studies, National Program for Community Empow- undertakes rigorous impact evalutions, facilitates South-South erment (PNPM) and local service delivery Knowledge Exchanges, and leverages the World Bank’s global around the world demonstrates that with expertise in community development, public financial manage- the right enabling environment, incen- ment, local economic development, stunting and community tives, and capacity support, ordinary health, and impact evaluation. citizens, villages, and local governments can diagnose the source of local prob- In 2016 LSP supported the Government to realize five key lems, identify solutions, and implement achievements: reforms that improve services and help • Supported the Government’s approach to delivering tech- reduce poverty. nical support to villages. The appointment of a new Minister of Villages in 2016 provided an opportunity to review the min- The Local Solutions to Poverty (LSP) istry’s approach to helping villages use their fiscal transfers Multi-Donor Trust Fund (MDTF) en- for infrastructure, human capital, and business development ables the World Bank to work at four investments. Through a series of high-level workshops, LSP levels to support the Government to helped the ministry develop a “Village Innovation Market- enable local development solutions place Model” to encourage innovation and deliver technical to poverty. First, it works at the highest support to villages. This approach moves away from a top- levels of government to help focus the down, supply-driven approach to one that is demand driven national policy agenda on reforms and and recognizes the capacity of villages and citizens. LSP will instruments that the national govern- continue to support the ministry to implement the reformed ment can use to empower and incentiv- model in 2017 and 2018. LSP ANNUAL PROGRESS REPORT 2016 E XE CUTIVE SUMMARY 6 • Put the quality – not just the pace – of village spending ment counterparts – including MoV and the Ministry of Home on the national policy agenda. After national policy makers Affairs (MoHA) – and provided policy briefs to Government prioritized the disbursement of village funds, LSP undertook to inform decisions on ways to maximize and increase com- a study of village expenditures in 2015 and presented the munity participation in local development by embedding the results to key government officials beginning in February principles of participation, transparency, accountability, and 2016. This initial study and presentations helped switch inclusion into efforts to improve local government regulatory the conversation from whether village transfers were being frameworks. In 2016, following focus group discussions spent to how they were being used, which generated de- with village heads, sub-district heads, and local leaders, mand for village spending data and analysis that culminat- LSP worked to build support for a new MoHA regulation ed in a presentation of recommendations to the Ministry of (Permendagri1 110/2016) that made Village Councils (BPDs) Finance (MoF). A second phase of the village expenditure independent of village heads. BPDs now monitor the quality analysis and recommendations will be presented to MoF in of village governments, which includes oversight, drafting the lead-up to the preparation of the 2018 national budget. village regulations with the village head, and managing and • Helped the Government test innovative citizen-driven regulating village planning meetings. approaches to improving the quality of pre-school and These results would not have been possible without the primary school services. LSP supported the Ministry support of the development partners that finance the MDTF, of Villages, Disadvantaged Regions and Transmigration which underpins LSP. In 2016, the MDTF enabled LSP to (MoV) and the Ministry of Education and Culture (MoEC) to provide US$23 million in grant funds to the Government to establish two pilots that have strong potential to improve the improve basic health and education services for 2.1 million quality of basic education services in rural Indonesia. MoEC beneficiaries in 11 provinces, and US$1 million for 66 villages and MoV launched the innovative ECED project or “Generasi to form committees to monitor school performance. It also PAUD Desa” pilot in 25 districts in April 2016, which empow- provided US$11.8 million to enable LSP to supply a package ers community groups and local service providers to jointly of knowledge programs, including just-in-time (JIT) policy organize professional development programs for teachers advice and technical assistance on Village Law implementation, from village-operated early education services. The pilot evaluations including the Long Term Generasi Impact Evaluation successfully delivered training packages to 7,797 community (IE), and enhanced implementation support including for the ECED teachers from 2,674 villages, and there is significant restructuring of the VIP and Generasi transition. potential for the program to be scaled up in the future by enabling villages to use their village funds for these activities. The LSP MDTF was restructured in 2016 to better meet the Similarly, LSP supported MoEC to launch the second phase Government’s ongoing demand for knowledge products, of KIAT Guru in July 2016. This pilot has the potential to well-designed and innovative lending operations, and transform the way the Government allocates US$7 billion in enhanced implementation support. In consultation with the annual teacher allowances by linking them to teacher per- National Development Planning Agency (Bappenas) and formance as assessed by parent and village committees. the MDTF donors, particularly the Australian Government’s Complementary evaluations for both pilots were also initiated Department of Foreign Affairs and Trade (DFAT), it was agreed in 2016. to rename the Trust Fund, realign it with Government priorities, • Operationalized the Generasi integration into the Village and streamline the governance arrangements. This enabled Law framework for community development. Generasi LSP to further secure the legacy of the Government and promotes the utilization of health and education services at development partner investments in community empowerment the village level in 5,700 villages across 11 provinces, many of approaches to poverty reduction. which have some of the highest stunting rates in the country. In 2016, LSP supported MoV to begin implementing the pro- gram’s transition strategy, which was necessitated by the $ 23 Million enactment of the Village Law in 2015. The support focused operational and technical resources on the West Nusa Teng- gara (NTB) province, where the full integration was piloted in 2016. The results are promising: 75 percent of villages allo- grant funds to the cated funds in their 2016 budgets for education and health Government to improve activities. The lessons from the pilot will inform how Generasi b a s i c h e a l t h AND will leverage over US$4.5 billion in village transfers for health and education activities in the remaining ten provinces e d u c at i o n s e r v i c e s in 2017. • Embedded community empowerment principles in village and local regulatory frameworks. Through its ongoing Sentinel Villages Study, LSP produced analytic work, held 1 Permendagri (Peraturan Menteri Dalam Negeri, or Minister of Home Affairs Regulation) focus group discussions with key stakeholders and Govern- LSP ANNUAL PROGRESS REPORT 2016 7 IN T ROD U CT ION CH APTER 01 Introduction 01 CHAPTER 1.1 Changes in the Operating Context In addition to maintaining its long-standing commitment effective support to the Government, LSP should realign to to reducing poverty, the Government of Indonesia (“the Gov- leverage its key strengths to empower communities to partner ernment”) has increasingly focused on addressing the country’s with the Government to improve local residents’ lives and to rising inequality. As part of this two-pronged approach, the Gov- maximize the effectiveness of significant levels of develop- ernment began implementing its new Village Law in 2015, which ment financing at the village level. The review identified LSP’s substantially increases the total value of Government fiscal analytical capacity, ability to facilitate policy dialogue, and ex- transfers (from US$4 billion in 2015 to an estimated US$12 perience in scaling up pilots nationally within Government billion in 2018) to 74,954 villages across the country. systems as key strengths. To ensure that these transfers have the intended impact, the Government is increasingly focusing on improving the quality of village spending and service delivery and on better under- BOX 01 • SUSTAINABILITY standing how these transfers affect development at the local level, including their impact on improving health and educa- LSP continues to deepen its focus on sustainability. tion outcomes. Despite previous spending increases in these Its package of impact evaluation and analytical and areas, Indonesia’s performance against a number of important operational support aims to support the policy frame- development indicators remains below that of many countries work, institutions, and systems that guide village at similar or lower levels of economic development. development and frontline service delivery. By making these policies, institutions, and systems more effective, The Government has also launched legislative reforms to participatory, and inclusive, LSP support is designed to address local service delivery challenges in a more holistic and improve the poverty and development impact of large integrated way. Law 23/2014 on Regional Government clar- government programs and financing long after LSP ifies functions, encourages innovation, and creates scope to projects are completed. streamline public financial management. It establishes six basic public services as essential for all citizens, including infrastruc- LSP’s combination of analysis, operational support, ture, health, and education. and rigorous impact evaluation is increasingly directed at sustainable reforms of government policies and In 2016, DFAT initiated an independent review of the MDTF systems. LSP helps the Government test participatory in close consultation with the Government and the World Bank. village development and service delivery approaches, The review concluded that in order to continue providing assess the impact of these approaches using rigorous impact evaluation tools, and feed the results of this VILLAGE FUNDS analysis back into long-term policy reforms and service INCREASE delivery improvements. $ 12B • Shifting from the implementation of a large-scale $4B community-driven development (CDD) program to a focus on institutionalizing good governance prin- ciples, including participation and inclusion in core village government systems. The restructured VIP (formerly PNPM Rural) and Village Law Programatic Advisory Services and Analytics (PASA) support the Government to assess and improve the effective- ness of annual fiscal transfers to villages, including strengthening fiduciary systems and institutionalizing IN 20 1 5 IN 20 1 8 LSP ANNUAL PROGRESS REPORT 2016 I NT RO D U C T I O N CHAPTE R 0 1 8 PNPM’s participatory mechanisms and practices into long-term reforms of the legal-regulatory framework and core systems of local government. • Finalizing the Long Term Generasi IE to provide the evidence base to inform Government. • Testing community-based approaches through the KIAT Guru project to improve teacher perfor- mance in order to incorporate effective approaches into Government systems and policies that will leverage the impact of the US$7 billion that the Government spends on teacher allowances annually. Together, LSP’s analytical, technical, and operational support seeks to leverage the effectiveness of much larger government resources and programs that will continue to function after LSP support ends. CHAPTER 1.2 Local Solutions to Poverty LSP aims to assist the Government to improve the quality of life of poor and vulnerable Indonesians through local solutions to reduce poverty and inequality. The program recognizes that poverty is multidimensional and requires the creative engagement of the poor as key actors in poverty reduction. Empowering the poor also requires strengthening government and community institutions and ensuring that economic growth is accompanied by a strong commitment to ensure that vulnerable and marginal groups are not left behind. LSP helps the Government to maximize the impact of its key development programs by: (i) producing and disseminating high-quality research and analytics, including from ongoing projects, in collaboration with other development partner activities; (ii) promoting evidence-based policy to reduce poverty and inequality, in particular as it relates to Indonesia’s framework for local government; and (iii) strengthening relevant government data and monitoring and evaluation (M&E) systems. LSP ANNUAL PROGRESS REPORT 2016 9 IN T ROD U CT ION CH APTER 01 BOX 02 • RELEVANCE LSP is the World Bank’s primary instrument to engage on Indonesia’s highly relevant – and changing – agenda around village/community development and frontline service delivery. Indonesia’s efforts to strengthen village gover- nance and development and to improve frontline service delivery will be critical determinants of whether the country is able to achieve multiple national development priorities. These include reducing inequality between regions, addressing high stunting rates and low educational attainment, and improving opportunities for citizens in remote and lagging regions. The focus of LSP – as well as its name – has likewise shifted to reflect these changes. Drawing on more than 16 years of World Bank experience working with, across, and at dif- ferent levels of Government to help innovate and scale up local development and community empowerment programs (such as the Kecamatan Development Program-KDP, PNPM), LSP is helping the Government develop policies and systems to implement its poverty reduction strategy. “Taking care of our LSP’s combination of large-scale operational support, analytics, and impact eval- uation is helping to integrate and mainstream more of the lessons learned from parents: In the village past community-driven programs, apply rigorous analytics to determine what is of Pejanggik, in working (and what is not), and help to improve policies, systems, and capabilities Central Lombok, the to ensure that large Government programs and initiatives – like the Village Law, teacher incentives, and frontline services – are inclusive, accountable, and partici- village government has patory, and deliver more impact on the ground. LSP is now focused on three goals. used village funds to • Improving the impact of the Village Law on poverty and local development through a combination of analytical support and the World Bank VIP loan. These inter- provide vitamins and ventions focus on ensuring that the significant financial resources that Indonesia regular twice-yearly spends on its villages yield greater impacts on livelihoods and well-being. medical checkups for • Improving frontline service delivery through Generasi, which is now working on integrating a focus on frontline services into Village Law implementation. older members of the Improving frontline service delivery will help young Indonesians get a good community who are not start in life that will yield major returns. covered by Indonesia’s • Strengthening the interface between service providers and communities through KIAT Guru to improve the impact of local services by involving beneficiaries. health insurance These interventions are very relevant to some of Indonesia’s most pressing program for the poor development challenges. The MDTF that underpins LSP is the key mechanism and near-poor. Last year, that allows LSP to continue to draw on global knowledge, and help the Govern- ment distill and apply lessons from Indonesia’s CDD experience to improve local 1,200 elderly people livelihoods and solutions to poverty. joined the program, of whom only around CHAPTER 1.3 300 were covered by the national insurance LSP’s Operational Framework program.” LSP’s Theory of Change framework illustrates the program’s scope of activities and measures the extent to which it is achieving its main objectives of reducing poverty and inequality (see Figure 1). LSP began the process of updating its M&E framework in November 2016 to evaluate and measure its performance against 2 LSP refreshed its Theory of Change and results both (i) high-level indicators linked to Government strategies and donor perfor- framework at the end of 2016, and has had to mance assessment frameworks and (ii) project-level indicators that align with the retrofit the results achieved to this new frame- work. Therefore, this annual report represents a three End-of-Facility Outcomes (EOFOs) (see Figure 2). This report describes LSP’s transitional output from the old PSF approach to progress against the three EOFOs from January to December 2016.2 LSP plans to the new LSP Theory of Change framework. complete the new M&E evaluation framework in 2017. LSP ANNUAL PROGRESS REPORT 2016 I NT RO D U C T I O N CHAPTE R 0 1 10 FIGURE 01 Theory of Change REDUCE POVERTY & INEQUALITY REDUCE POVERTY & INEQUALITY WHERE DO WE WORK? WHERE DO AT THE WE WORK? INTERFACE OF SUPPLY AT THE AND DEMAND INTERFACE OF SUPPLY AND DEMAND Inclusion Inclusion Transparency CDD Transparency CDD INFRASTRUCTURE BASIC SERVICE LO C A L E C O N O M I C Accountability INFRASTRUCTURE BADSE IC VE L IS RV ER YI C E LO CDAELVEEC ON LO POMMEINCT Accountability DELIVERY D E V E LO P M E N T DO DO WHAT WHAT WE OFFER? WE OFFER? Producing Producing high quality high quality research research M D ED EA M NAD ND SU S UPPPP LY LY and and analytics analytics Promoting Promoting policy policy evidence-based evidence-based COMMUNITY COMMUNITY SUB-NATIONAL SUB-NATIONAL NATIONAL NATIONAL Testing Testing and scaling-up and scaling-up innovations innovations R TR PA PA ICT I PAT EE C I PAT IM IMP LE PL ME N T EM EN EN AL AB BEL E Supporting collaboration, Supporting problem collaboration, problem solving, and knowledge solving, exchange and knowledge exchange LLSSP PR P P RO OJ EC JE TS CT S FIGURE 02 End-of-Facility Outcomes Outcome 1 Outcome 2 Outcome 3 Community Participation Sub-national Governance National Systems and in Local Solutions to and Capability: Ability to Enabling Environment – Poverty Plan and Implement Local Ability to Guide, Encourage, Solutions to Poverty and Support Local Solutions Improving communities’ capacities to participate in local development to Poverty Strengthening sub-national governance solutions to reduce poverty and and capability to plan and implement Improving the enabling environment inequality. development activities at the local and national systems to guide, level to reduce poverty and inequality. encourage, and support local • Building knowledge and capacity in the health and education sectors; development solutions that reduce • Building village government capacity poverty and inequality. • Building knowledge and capacity to plan, implement, monitor, and report on neighbourhood development; on development needs, taking into ac- • Increasing the availability and quality and count community priorities throughout of data and analytics; • Building knowledge and capacity the process; • Increasing the availability and quality on planning and budgeting. • Building better performance incentives of Village Law implementation sup- and accountability mechanisms at the port structures; district and village levels; • Improving the legal and regulatory • Improving the skills of service providers framework for participatory, inclusive, and the quality of services; and and effective village development • Improving institutional capacities to ad- and local service delivery; and dress frontline service needs. • Improving the allocation, targeting, and flow of funds for village develop- ment and local service delivery. LSP ANNUAL PROGRESS REPORT 2016 11 IN T ROD U CT ION CH APTER 01 Description of Key Activities Early Childhood Education and Devel- ence using mobile phone-based applications; and (ii) evaluate opment (ECED): The ECED project pro- teacher service performance using community scorecards. vides an opportunity to test a frontline The pilot started in July 2016, with implementation in 203 service delivery approach that addresses primary schools and impact evaluations conducted in 270 constraints impeding the quality of early primary schools across five underdeveloped districts. childhood education services in rural areas. The project was developed to Monitoring and Evaluation (M&E) and Special Studies: As increase the availability of high-quality, part of its analytical support to the Government, LSP empha- affordable professional development sizes the importance of using evidence-based analysis to for early childhood teachers in poor, inform policy formulation and program implementation. LSP (i) rural districts. It leverages and enhances provides M&E for flagship poverty reduction projects on com- existing government teacher training munity empowerment, including PNPM, Generasi, and Village programs, strengthens local capacity to Law implementation, to provide evidence to improve their deliver training at the district level, and performance, offer advice to policy makers, and achieve introduces community participation in results; and (ii) conducts in-depth research on local and social the service delivery process. A profes- development priorities in Indonesia. sional development package costing Village Innovation Program (VIP): The VIP focuses on approximately Rp 1,500,000 (US$ 113) helping villages use their fiscal transfers to make sound village per teacher is being implemented in 25 development investments. The project seeks to enable and districts to test the viability of scaling incentivize villages to allocate more of their fiscal transfers from the system up in villages across Indonesia; the Village Law to entrepreneurship and to improve the technical 16,000 community ECED teachers from quality of these activities. The program provides financing for 2,500 villages will participate in the project. three platforms: (i) a district-level village innovation platform that Generasi: The Generasi project works will support the institutionalization of the knowledge-sharing to empower local communities in poor, functions of the PNPM facilitation and community empowerment rural sub-districts in project provinces to activities; (ii) a capacity-buil ing platform for local technical increase the utilization of health and ed- service providers that will improve their ability to deliver ucation services. It provides an incentiv- technical services to villages; and (iii) a data platform that will ized, participatory block grant system to support the maintenance and use of a dataset on village meet the health and education needs of development needs, priorities, and outputs. Together, these women and children in these areas and fi- platforms will improve villages’ capacity to plan (and ultimately nances capacity-building activities at the use) their fiscal transfers for village development investments village level. The project targets three with a focus on village entrepreneurship, human capital forma- Millennium Development Goals in which tion, and village infrastructure. Indonesia’s performance is lagging: Village Law Programmatic Advisory Services and Analytics (i) achievement of universal basic ed- (PASA): The overall objective of the Village Law PASA is to ucation; (ii) reduction in child mortality; support Government efforts to ensure accountable village gov- and (iii) improvement in maternal health. ernance and participatory village development. The project Utilizing agreed-upon targets for 12 delivers three main types of support: JIT policy advice and health and education indicators, the analytics, technical support for the operationalization and project promotes community participa- implementation of policies and systems, and robust analytics. tionin decision making to identify and The activity provides analytical and technical support to the implement local solutions to health and Directorate General of Fiscal Balance (DJPK), Bappenas, education challenges. MoHA, the Coordinating Ministry of Human Development and KIAT Guru: The KIAT Guru project is Culture (Kemenko PMK), MoV, and other stakeholders. The helping to improve education service Village Law PASA project is organized around four pillars: delivery in remote villages by empower- (i) resource mobilization, allocations, and flows; (ii) village ing communities and tying the payment development governance, accountability, and capacity; of the teacher remote area allowance (iii) community empowerment and inclusion; and (iv) monitoring, to teacher service quality. It empowers evaluation, and thematic studies. communities to (i) verify teacher pres- LSP ANNUAL PROGRESS REPORT 2016 PROG R ES S TOWA R D S OU T COM ES CHAPTE R 0 2 12 Progress Towards Outcomes 02 CHAPTER 2.1 Outcome 1: Community Participation in Local Solutions to Poverty Over the past 16 years, CDD results in illustrated in the box below (“Story from development services for ECED teach- Indonesia have shown that development the field: Sky Train”). ers by helping the community participate initiatives tend to be more relevant and in the implementation and monitoring of effective, and produce higher-quality out- Generasi continued its work on the Long professional development training for comes, when the community perceives Term Generasi IE, which gauges the ECED teachers across 2,647 villages. its contribution to be meaningful and is potential to utilize Generasi’s incentive Each participating village nominated empowered with a sense of ownership.3 model to support the development of community ECED teachers to participate Therefore, LSP provides support to the a basic service delivery approach un- in the training. Furthermore, community Government to ensure that communities der the Village Law by assessing the organizations based at the sub-district have the relevant capabilities, technical project’s impact over the last nine years level (UPKs, or Sub-District Financial skills, and knowledge to participate in on the approximately 70,000 randomly Management Units) contracted local planning, implementing, and monitoring selected district and sub-district grant non- governmental organizations (NGOs) development priorities that affect them. recipients. Generasi conducted evalua- as training providers and helped them LSP’s operations and knowledge proj- tion surveys and qualitative fieldwork as develop training schedules and bud- ects are intended to help the Government part of this impact evaluation. The find- gets. Through these UPKs, the commu- achieve this outcome. ings from these surveys are intended nity monitored the quality of training be- to inform policy makers and other re- fore final payments were released to the In 2016, the Village Law PASA continued levant stakeholders on effective ways training providers. to provide assistance to the Government to encourage community participation to hire and train 26,000 facilitators to in delivering development solutions, Similarly, KIAT Guru worked to build the help communities identify local devel- including health and education, at the capacities of local communities, including opment needs in 74,594 villages and local level. create solutions to address these needs. In addition, the ECED project focused 3 Analytic studies: the PNPM Rural Impact Evalu- An example of communities engaging in ation Report, Qualitative Impact of PNPM Rural, local solutions to development needs is on enhancing the quality of professional Beneficiary Survey for PNPM Rural LSP ANNUAL PROGRESS REPORT 2016 13 P ROG R ES S TOWA R D S OU T COME S CH APTER 02 through village cadres who will be financed by the local govern- at different levels of development. In 2016, the study published a ments, to improve education service delivery. This is expected policy brief that advocated an independent BPD responsible for to sustain community participation in improving service delivery overseeing the village head’s performance, channelling villagers’ beyond the life of the project. aspirations, and drafting village regulations with the village government.4 It also recommended that a new regulation require Finally, as part of the Village Law PASA, LSP launched the lon- the inclusion of female representatives on BPDs and give BPDs gitudinal Sentinel Villages Study on Village Law implementation a mandate to evaluate the performance of village governments. in five districts and 112 villages for the quantitative study com- LSP shared these recommendations with stakeholders from ponent, and in ten villages for the qualitative study component MoHA and other agencies through a series of focus group (implemented in coordination with the SMERU Research Insti- discussions to support the development of the new BPD regulation. tute). The study examines how villages are experiencing vari- The recommendations were incorporated into the regulation ous aspects of Village Law implementation, particularly how the that MoHA issued in December 2016. principles of participation, transparency, accountability, and inclusion are being operationalized at the village level. It covers a diverse range of areas within Indonesia and includes villages 4 Policy brief: Reforming BPD to Strengthen Villages STORY FROM THE FIELD: SKY TRAIN Village Funds Connect Isolated Community with Markets The local community built a sky train that spans 135 The residents successfully proposed the development of metres to transport the agricultural products produced in a sky train (designed by the village head) using Rp 24 the Loloan village of North Lombok to outside markets. million (US$1,780) in village funds. The sky train vastly Before the sky train was built, residents had to descend reduced the time, effort, and cost associated with bring- 100 metres down a hill to cross a river and ascend the hill ing goods to and from markets. Before it was built, the co- on the other side every time agricultural inputs, such as mmunity could transport a maximum of 200 kg of produce fertilizers and farming tools, needed to be brought from per day. This has now increased to around two tons per local markets to their farms. To transport their produce to day, and the transport costs are much lower: farmers pay markets, farmers had to hire help. Due to the high cost of only Rp 5,000 (US$3.70) per trip towards maintenance, labour, they operated on extremely thin margins. whereas previous labour costs to transport produce were Rp 50,000 (US$30.70) per 60 kg. LSP ANNUAL PROGRESS REPORT 2016 PROG R ES S TOWA R D S OU T COM ES CHAPTE R 0 2 14 CHAPTER 2.2 Outcome 2: Sub-national Governance and Capability: Ability to Plan and Implement Local Solutions to Poverty With the substantial increase in the funds allocated to villages over the past two years, the Government is increasingly empha- sizing interventions to improve villages’ capacities to effectively spend these funds to improve development outcomes. A critical element of this capacity building involves ensuring that village governments are well equipped to engage with the community to participate in local solutions to poverty, and that they are doing so in practice. LSP is supporting the Government by incorporating key lessons from PNPM into the implementation of the Village Law and Indonesia’s broader framework for local government. LSP provides technical assistance, leverages Government-executed grants and World Bank loans, and produces analytical work to help local government and service providers engage with communities. 2.2.1 | Enhancing local government capacity In 2016, LSP activities focused on building local government capacity to deliver local development solutions to reduce poverty and inequality. Enhanced implementation support to the Government’s VIP was provided to help MoV train district and village facilitators on issues related to planning, budgeting, implementation, the procurement of goods and services, reporting, and M&E. Through Generasi, LSP provided support to build village governments’ capacities to use Village Law funding to improve the delivery of health and education services. Training was administered as part of the project’s exit strategy. Over the long term, health and education activities are expected to be funded through local government resources, including Village Law funds. The training was conducted in 299 sub-districts, and participants consisted of the village head and/or other village apparatus and BPD representatives. Together with the DFAT-supported Indonesia Governance for Growth (KOMPAK) program, the Village Law PASA helped the Government develop the Guide on the Implementation of Village Development, which provides guidance to government offi- cials and facilitators on village development processes in the context of the Village Law. Kemenko PMK published this guide in collaboration with Bappenas, the Finance and “Village fund for Development Supervisory Agency (BPKP), MoF, MoHA, and MoV. The guide has been widely disseminated throughout Indonesia to relevant government institutions, commu- infrastructure: In the nity service organizations, and NGOs as a reference and capacity-building resource for village of Pejanggik, village development. in Central Lombok, the 2.2.2 | Improving performance incentives and accountability village government has mechanisms at the district and village levels used village funds to pave Service providers and local government institutions are more likely to deliver quality a dirt road to provide services if well-designed performance incentive and accountability mechanisms are in access to the markets in place. The Generasi project helped the Government develop a performance incentive system to allow communities to improve their collection of data with which to monitor all weather conditions the quality of health and education services. The results of routine monthly monitoring for villagers in and data collection activities in 2016 have been used to inform discussions of health and education issues at the village level. three hamlets.” LSP is also testing performance incentive mechanisms at the sub-national level. In 2016, the KIAT Guru project worked to improve education service delivery in remote villages by tying the payment of remote area allowances to teacher presence and service quality using existing district- and national-level public financing mechanisms. LSP ANNUAL PROGRESS REPORT 2016 15 P ROG R ES S TOWA R D S OU T COME S CH APTER 02 2.2.3 | Improving the skills of service providers to enhance service quality LSP has facilitated a range of activities to enhance the skills of health and educa- tion service providers. For example, in 2016, Generasi provided training to 10,232 midwives and village health cadres to improve their ability to deliver Infant Young Children Feeding training. This training allows Generasi to address the problem of stunting, or below-normal height for a given age. Generasi contributed to the resolu- tion of 52,105 cases of underweight children, responded to 12,649 cases of chronic energy deficiency amongst pregnant women, and provided counselling to 154,323 pregnant and lactating women (average of 30 pregnant and infant-caregiving women per village). The ECED project helped MoEC train 260 master trainers across 25 districts, which improved the availability of professional development services for ECED teach- ers in rural Indonesia. In addition, LSP engaged national and international experts MID W IVES to develop enhanced training materials and conduct corresponding training for TRAINED district trainers across ten participating districts. From October to December 2016, LSP supported the delivery of 203 training classes for 7,797 community ECED teachers (exceeding the annual target of 7,500). This success was due to stronger- than-anticipated engagement in the project by village government stakeholders, who were responsible for nominating early childhood educators from their commu- nities to participate in the project. 2.2.4 | Institutional strengthening to support service providers to address frontline service needs To improve the quality of basic services, LSP focuses on measures to strengthen village government planning, implementation, and monitoring capacities and to de- velop better performance incentives and accountability mechanisms. It also works to improve institutional capacities to address frontline service needs. In 2016, LSP worked on institutional strengthening to support service providers addressing frontline service FACILITATORS needs in a number of its projects. TRAINED To enhance the institutional capacities of the agencies involved in verifying teach- ers’ attendance and evaluating the quality of their teaching, the KIAT Guru project provided technical assistance to district governments to strengthen the relevant gov- ernance and institutional arrangements at the district, sub-district, and village levels, and to enable village governments to allocate funds for education. Specifically, KIAT Guru: (i) reviewed the relevant regulations and existing business processes; (ii) drafted new regulations, new business processes, and administrative forms based on inputs from Government; and (iii) developed the capacity of government staff on the effective adoption and use of new business processes and administrative forms. Generasi introduced its Village Law integration pilot project in six districts in NTB prov- ince to help ensure that village governments addressed issues related to health and education in their regular village planning and budgeting processes. Generasi also initiated a transition strategy to integrate the project into the regular Village Law imple- mentation process in these six districts. ECED TEACHERS TRAINED Together with the community and staff from the Village Community Empowerment Agency, Generasi facilitators in the West Lombok district advocated drafting local regulations that supported the prioritization of education and health-related services in village budgets. As a result, local regulations were issued to provide village govern- ments with a legal reference to conduct basic social service deliveries focused on health and education. LSP ANNUAL PROGRESS REPORT 2016 PROG R ES S TOWA R D S OU T COM ES CHAPTE R 0 2 16 To strengthen support to frontline service providers, the ECED project monitored trainers and classroom teachers in participating districts. The project also collected baseline data for its longitudinal study to assess the impact of the intervention on teacher competency. This process involved ECED teacher evaluations,5 teacher and trainer surveys on background characteristics and their perceptions of the project, and a village stakeholder survey to measure community perceptions of the project. 5 Teacher competency is assessed using the Measure of Early Learning Environment Setting tool, which was developed as part of the Measuring Early Learning Quality and Outcomes project initiated by the World Bank in partnership with UNICEF and the Brookings Institution. The tool assesses teachers against a set of ‘observable indicators’ related to professional, pedagogic, and social competencies. Teachers will be evaluated before training (baseline) and six months after (endline) to determine whether their teaching ability has improved as a result of the ECED intervention. STORY FROM THE FIELD: Early Childhood Care and Education Building the Capacities of an Early Childhood Education Teacher To Meet the Needs of the Community’s Children Dini Ruhiyatun is the only teacher at the Seroja Indah education in the village, and has provided her with sup- Early Childhood Education Center (PAUD) in the Barabali Vil- port to improve her skills. Recognizing that she has no lage of Central Lombok. The PAUD, which has more than 20 formal background as a teacher, the village government students, had no permanent location until recently. In 2016, supported her participation in PAUD teacher training as members of the community lobbied the village government part of the ECED project. The training was provided to to build a multi-function hall using Rp 60 million (US$4,450) Dini and 7,796 other community-based teachers in 2,647 in village funds. The idea to build the hall was initiated villages throughout the 25 participating districts in 2016. through the Generasi project, which is dedicated to integrat- ing mother and child healthcare, as well as early childhood Dini explains, “In one of the training modules, we were education and development projects, into village develop- taught how to develop a teaching workplan. This was ment planning. The hall is also used as a local health service extremely valuable, providing me with a practical guide post (posyandu) and for other community activities by three for how to better present lessons in my classes. After nearby hamlets. participating in the training, I have been able to develop teaching material in a more structured way. The training The village government has acknowledged Dini’s signifi- also strengthened my confidence and invigorated my cant contribution to improving the quality of early childhood passion to continue teaching.” LSP ANNUAL PROGRESS REPORT 2016 17 P ROG R ES S TOWA R D S OU T COME S CH APTER 02 STORY FROM THE FIELD: Village Maternal Health Post Village Community Participation for Convenient Maternal Healthcare Services The Rempek Village Maternal Health Post (Polindes) To accommodate accompanying family members, the in the hamlet of Gelumpang Sanyar (which has 248 in- community also proposed the construction of a gazebo, habitants), in the Rempek village of North Lombok was which was accepted by the village government and built built using Rp 160 million (US$11,865) in village funds. Sup- using Rp 18 million (US$1,335) allocated from the village plies such as cabinets, tables, and chairs were purchased funds in 2015. According to the village head, “In 2016, we using the village funds, while the medical equipment and allocated almost 50 percent of the total value of the vil- medicines were provided by the sub-district community lage funds we received for the development of education health centre (puskesmas) with support from MoV and the and health services facilities.” National Family Planning Board. The Polindes provides a range of basic services for wo- men and children, including antenatal care, childbirth, and contraception. The midwife lives on site, and is therefore always on call and available. Before the clinic was built, expectant mothers usually had to travel to a facility in the neighbouring village hamlet more than a kilometre away. In 2016, the Generasi project actively conducted a number of similar initiatives throughout the community, which increased awareness of mother and child health- care. The construction of the facility was proposed at a hamlet-level community meeting consisting entirely of The Rempek Village Maternal Health Post in North Lombok was women. The women’s proposal was then put forward at financed by a village fund allocation of Rp 116 million (US$ 8,708). a village-level meeting. LSP ANNUAL PROGRESS REPORT 2016 PROG R ES S TOWA R D S OU T COM ES CHAPTE R 0 2 18 CHAPTER 2.3 Outcome 3: National Systems and Enabling Environment: Ability to Guide, Encourage and Support Local Solutions to Poverty 2.3.1 | Increasing availability and quality of data and analytics The effective implementation of the Village Law has required taking into account factors such as village populations, average levels of economic and human devel- opment, level of access to networked infrastructure and services, geographical location, and impediments to basic service access. In addition, critical to enabling stakeholders to develop systems to effectively use village funds is the Government’s ability to track development outcomes from the disbursement of village funds. In 2016, to improve the Government’s capacity to collect and utilize village-level data to track outcomes and to make better decisions on spending, LSP initiated coopera- tion with Bappenas and the Indonesian Central Bureau of Statistics (BPS) to strengthen national instruments for collecting this data, and to pilot measures to improve the SIS K EUDES HAS data collection process and build the capacities of village apparats and/or cadres. BEEN FULL Y LSP also analyzed the village fund allocation formula used to disburse funds to IMPLEMENTED IN 25,000 villages to understand how it affects the impact of poverty reduction policies as part of an ongoing sub-national public expenditure review. This review found that per capita allocations in villages with large populations were drastically lower than in those with small populations. LSP proposed adjustments to the allocation formula that take into account average levels of economic and human development when VILLAGES allocating funds. These adjustments were presented to stakeholders from Bappenas, DJPK and MoV through workshops and development policy forums. Bappenas has expressed a strong interest in revising the formula, and discussions with other stake- holders are ongoing. SOCIALI Z ED IN In 2016, LSP continued its monthly phone surveys to assess the timeliness of the disbursement of village funds in 392 districts (covering more than 90 percent of the villages in these districts that receive these funds). The results were presented to DJPK to enhance its understanding of the disbursement process. VILLAGES 2.3.2 | Increasing availability and quality of support structures for implementation of local solutions to poverty PARTIALL Y To enable villages to record their budgets and finances efficiently, accurately, and IMPLEMENTED IN in a timely manner, the Village Law PASA provided technical assistance to BPKP to develop a financial management software package called Siskeudes. This system enables village governments to submit budgets and realization reports to account for their usage of village funds in a standardized format. It has eliminated many inefficiencies and human errors in village financial reporting. Of Indonesia’s 75,954 VILLAGES villages, Siskeudes has been fully implemented in 18,284; socialized in 47,741; and partially implemented in 34,797. In 2016, the Village Law PASA also provided support to MoHA to address issues related to inconsistent village accounting procedures by proposing revisions to Permendagri 113/2015, which defines the enabling environment for village financial management. Inconsistent village recordkeeping processes have hampered Gov- ernment efforts to track how village funds are channelled and spent, which has made it difficult to consolidate financial data and to accurately determine how much has been allocated to specific sectors. Following discussions with stakeholders within MoHA, MoF, and MoV, a final draft of the new regulation is currently being discussed LSP ANNUAL PROGRESS REPORT 2016 19 P ROG R ES S TOWA R D S OU T COME S CH APTER 02 at the inter-ministerial level. This revised system will help village communities to better understand their expenditures on infrastructure, health, and education issues and provide them with customized tools to develop local solutions to problems. LSP also provided extensive advice to MoF on how its regional finan- cial management information system could be revised to better support the disbursement of village funds. The implementation of the Village Law has highlighted the need for mechanisms to enable communities to monitor and evaluate the performance of their elected officials, including village heads. Following focus group discussions with village heads, sub-district heads, and local leaders in approximately 100 remote villages in six districts, and taking into account the results of the Sentinel Villages Study on BPD,6 LSP recommended making BPDs independent of village heads, which has allowed the councils to monitor the performance of village governments, including exercising oversight, drafting village regulations with the village head, and managing and regulating community planning meetings. Based on these recommen- dations, the Village Law PASA supported the development of a new regulation (Permendagri 110/2016) to make BPDs independent of village heads in order to allow communities to better monitor and evaluate the performance of their elected officials. The regulation was issued in December 2016, and implementation has started in several villages. MoHA has been socializing the regulation through the district government. 2.3.3 | Improving support from the national government Though multiple actors remain responsible for service delivery, the Village Law implementation transferred a large amount of responsibility for service delivery from the national government to the village level. To support this transition, the Village Law PASA helped MoV prepare a pre-service training curriculum and modules for district, sub-district, and village-level facilitators in village planning, implementing, and moni- toring development processes. The Village Law PASA provided assistance to MoV to improve facilitators’ terms of reference and standard operating procedures for handling complaints, and to revise regulations related to community training (Permendes 9/2016). LSP also helped the Government develop national and district decrees to support the implementation of the KIAT Guru project. A Memorandum of Understanding between MoEC, the National Team for the Acceleration of Poverty Reduction under the Secretariat of the Vice President’s Office, and the five pilot districts was signed. MoEC and the five pilot districts have demonstrated a strong commitment to the 6 See Reforming BPD to Strengthen project by issuing decrees to formalize the national and district coordination teams and allocating bud- Villages gets for their activities. LSP ANNUAL PROGRESS REPORT 2016 PROG R ES S TOWA R D S OU T COM ES CHAPTE R 0 2 20 CHAPTER 2.4 Gender and Inclusion The potential for Indonesian women to be a substantial engine the distribution of vitamin supplements, and participation for poverty reduction is not being fully realized. Despite the in nutrition classes). In addition, the Long Term Generasi IE overall increase in employment opportunities and substantial tested whether the nine-year project has directly reduced gains in girls’ access to (and participation in) education over stunting and wasting and improved the quality of maternal the past few decades, Indonesian women still participate sig- health services. nificantly less than men in the labour market. Increasing female 3. Increasing women’s participation in village-level decision labour force participation would directly contribute to economic making: LSP worked to improve women’s participation in growth. Furthermore, improving women’s outcomes in health, decision-making processes by developing training modules education, and employment would reduce the intergeneration- for village and district facilitators that included topics related al transmission of inequality and improve future outcomes for to gender equality and social inclusion. Generasi cadre children, ranging from better anthropometric (i.e., height and and facilitators, 71 percent (156,742) of whom are women, weight measurements) indicators to more schooling and thereby played an active role in encouraging village governments better labour market outcomes. to spend village funds on basic social services, including through the payment of honorariums for posyandu cadres. In 2016, to promote gender equality and to improve the While no quotas were established, LSP worked with MoV socio-economic standing of women, LSP helped the Govern- to encourage women to apply for district and village ment work towards: facilitator positions to support Village Law implementation. 1. Reducing the maternal mortality rate: Generasi helped the Twenty-four percent of district and village facilitators are Government address the low rates of service utilization currently women. LSP also ensured that the principles among pregnant women and new mothers, and poor-quality of gender equality and inclusivity were included in the maternal and infant health services, by providing conditional curriculum for village apparatus training. To help the grants directly to community members and facilitators trained Government monitor the participation of women and in health and education issues. According to Generasi’s marginalized groups in village-level decision-making Monitoring and Information System, 97.4 percent of women processes, LSP commissioned surveys through the Sentinel received a facility or trained-professional-assisted birth. Villages Study, which yields detailed gender-disaggregated Forthcoming results from the Long Term Generasi IE will information on women’s participation in village development demonstrate whether Generasi has improved these service planning. Around 24 percent of survey respondents reported utilization targets and facilitated improvements to the maternal having participated in village meetings in the past year mortality rate and other indicators of maternal health. (993 out of 4,081). Of those who reported attending 2. Improving nutritional care for mothers and infants: In 2016, meetings, 41.7 percent were women (414 out of 993). Generasi aimed to directly reduce malnutrition by providing Women with small children (under four years of age) and communities with block grants and facilitators trained in those who live far from the village offices were less likely health issues. These grants were tied to the community’s to participate in meetings, indicating significant barriers to achievements in improving maternal health and infant attendance. On average, women who attended meetings nutrition indicators (e.g., monthly infant weighing sessions, were less active than men (e.g. did not provide sugges- tions, ask questions, or vote on decisions). However, female activists were just as active as their male counterparts in terms of attending and participating in meetings. Altogether, these findings suggest that female activists should be encouraged to play a role in ensuring that women’s voices are heard in village planning processes. LSP shared study results with MoV and MoHA through policy briefs and periodic information-sharing events. 4. Increasing women’s access to economic opportunities and financing: LSP began work to improve women’s livelihoods by supporting MoV with the design of a female entrepre- neur pilot project. This was also incorporated in the VIP design to support female entrepreneurs in villages through a combination of in-kind contributions, mentoring, and training. Local women in a training financed by village funds to increase their This intervention seeks to decrease the vulnerability of participation in improving family welfare. poor households, especially their female members, by LSP ANNUAL PROGRESS REPORT 2016 21 P ROG R ES S TOWA R D S OU T COME S CH APTER 02 providing resources and encouraging information sharing in order to help entre- preneurs generate a sustainable income and livelihoods. Supporting households’ permanent exit from poverty remains an important challenge in Indonesia, with 15 percent of those who had escaped poverty in 2009 again falling below the pov- erty line in 2010 (World Bank Group 2015). Furthermore, in Indonesia, sustainable livelihoods are far less prevalent amongst women than amongst men. Indonesian women have a more precarious place in the country’s labour market (World Bank 2015), and suffer one of the largest gender wage gaps in East Asia.7 More broadly, beyond gender, LSP strives to improve social and economic access for poor and marginalized individuals and groups. In 2016, through the ECED project and its teacher training package, LSP worked to raise educators’ awareness on sup- porting children with special needs. One module of the training package focused on how educators can identify children who may require additional support and tailor their instruction approach to meet these needs. It also included methods to discuss these issues with families, as well as procedures to refer children for additional spe- cialized services. The project’s training approach also encouraged teachers to use local languages, practices, and materials in the classroom to empower indigenous communities. Similarly, the KIAT Guru Facilitation Manual mandated free, prior, and informed consultations with indigenous peoples and marginalized groups. Training modules prepared with LSP support for village and district facilitators included to- “In the village pics related to social inclusion. of Loloan, in North Lombok, the village CHAPTER 2.5 government has Innovation allocated IDR 6 million in village funds to In 2016, LSP helped MoV restructure its loan with the World Bank to deliver sup- provide thread to 10 port for Village Law implementation. This included adapting the community grant weavers in the mechanisms to support the identification, documentation, dissemination, and repli- cation of village innovations. To reflect this new strategic focus, the Government and community to increase LSP agreed to change the project name from the “National Program for Community their working capital. Empowerment-Rural 2012-2015” (PNPM Rural 2012—2015) to “Village Innovation Program” (Program Inovasi Desa), which reflects the institutional and policy changes Recently, the village related to village development introduced with the enactment of the Village Law. government provided In December 2016, LSP contributed to a strategic discussion hosted by the new additional funds to Minister of Villages on village innovation and developing a sustainable approach to the delivery of technical services to villages through the VIP. facilitate the purchase Furthermore, in 2016, Generasi facilitated the Village Law integration pilot in NTB, of weaving equipment which tested the discontinuation of block grant disbursements and the use of and to pay a senior Generasi support structures, including facilitators and village cadres, to integrate health and educational planning processes and service delivery into regular Village weaver from the Law implementation. As part of this initiative, Generasi consolidated knowledge community to management activities to identify innovative success stories from the field. conduct training.” Finally, LSP’s KIAT Guru project helped the Government implement regulations link- ing community empowerment with pay-for-performance mechanisms, and launched KIAT Kamera, a tamper-proof Android-based application that provides accurate data on daily teacher attendance. KIAT Guru also developed a community scorecard based on a service agreement between teachers and community representatives that identifies 5–8 priority education service indicators to be improved by teachers and evaluated by community representatives. KIAT Guru rolled out simple diagnostic and evaluation instruments for basic literacy and numeracy to inform community 7 Indonesia ranks 108th out of 142 countries in terms of women’s economic participation and members, parents, teachers, and policy makers about students’ levels of competency opportunities (World Economic Forum 2014) in skills required by the 2006 national curriculum. LSP ANNUAL PROGRESS REPORT 2016 K E Y CH A L LEN G ES CHAPTE R 0 3 22 Key Challenges 03 In 2016, LSP helped the Government address multiple challenges: (i) strengthen the policy framework and institutional capacity to use village funds to reduce poverty and improve local development indicators; (ii) bolster frontline service providers in rural areas; and (iii) adopt policy, institutional, and operational reforms to improve village and frontline services in rural areas. Challenge 1: Enhance the development impact of increased village funding on poverty reduction and local development. Fund allocation: Review current Dana Desa allocation formula and identify options to better target Village Law funds to reach the villages with the greatest poverty and development needs. Because of the “per village” village fund allocation formula, large villages with large numbers of poor people may not receive adequate financing to reach a significant number of poor individuals. To help address this challenge, LSP was at the forefront of conducting a detailed, village-level analysis of the current formula and modelling alternatives, and sharing this analysis with DJPK and other key stakeholders, as well as dis- seminating it widely via the World Bank’s Indonesia Economic Quarterly. These efforts greatly enhanced awareness across key stakeholders of the limitations of the current formula. LSP ANNUAL PROGRESS REPORT 2016 23 KEY CHA LLEN G ES CH APTER 03 Systems: Support reforms to strengthen planning and financial management systems to better track village expenditures, monitor outputs, and engage with citizens. The limitations of village financial management and M&E systems make it difficult for Government to readily determine how villages actually spend their funding, or the outputs they achieve using the funds. National and district govern- ments’ capacity to provide financial oversight and auditing of villages remains weak. LSP’s Village Law PASA provided technical and analytical support to: (i) revise the regulatory framework for village financial management; (ii) upgrade village financial management software; (iii) enhance the regulatory framework for village oversight and auditing; and (iv) improve village data in the Village Potential survey and annual village monitoring. Challenge 2: Frontline service providers in rural areas are not delivering the quantity and quality of services needed to improve development outcomes. Strengthen capacity and incentives of teachers in rural areas to provide quali- ty early childhood and primary education. There was a lack of community ECED teachers in poor and remote parts of the country, as well as limited uptake of local ECED services. The ECED project, piloted in 25 districts, empowered users of village- “To strengthen level ECED services to purchase professional development services in these areas. frontline service Despite large increases in teacher allowances, primary teacher absenteeism in remote areas was double the national rate. KIAT Guru combined community M&E with linking provision for early teacher remote area allowances to performance. LSP supported MoEC to launch the childhood needs second phase of this pilot in July 2016. the MoV and LSP Test applying Generasi’s frontline service delivery mechanisms to village funds. With the advent of the Village Law, MoV and LSP have embarked on a strategy to have applied apply Generasi principles and mechanisms to villages’ own funding, so that villages Generasi use their increasing funds for early childhood activities formerly financed by the principles and project. LSP also focused on simplifying the incentive system to make it more easily understood. mechanisms to villages’ own funding.” Challenge 3: Policy and operational interventions to improve village and frontline services in rural areas are not adequately informed by evidence. Improve data and analysis to inform decisions on improving rural service delivery. Government and other stakeholders need reliable information to better ensure that the financial resources are being used well, and that programs are on track to deliver development impact at the local level. LSP enabled the implementation of rigourous impact evaluations to inform key policy and implementation deci- sions on how to improve the quantity, quality, and impact of rural service delivery. LSP ANNUAL PROGRESS REPORT 2016 K E Y CH A L LEN G ES CHAPTE R 0 3 24 LSP continued to enable rigorous impact evaluations – to inform Generasi (supported by one of the world’s longest-running randomized control trial impact evaluations), the ECED project, and the KIAT Guru project. In addition, LSP supported high-quality analytical work in many cases the most detailed and rigorous analytical work available – on the Village Law allocation formula and the village public expenditure review. Finally, LSP increasinly focused on strengthening key elements of the Government’s M&E systems and capacities related to villages and frontline service delivery. “In the village of Loloan, BOX 03 • RISK MANAGEMENT in North Lombok, the village government Coordination among key counterparts at the national and local levels remains allocated Rp 27 million a key risk that needs to be managed. To mitigate the risk and improve co- ordination, LSP engaged Kemenko PMK to seek coordination assistance. in village funds in 2016 It also deepened its engagement with MoHA as part of the MDTF reform strat- to repair and renovate egy agreed on a new cooperation agreement with the Government, which will hopefully lead to improved coordination. In the future, LSP will facilitate the bridge and road more comprehensive engagement with MoHA, which could lead to better system in the hamlet of cooperation and a more concerted approach to some of the key issues that Tanah Petak Lauk. This LSP is focusing on. initiative was intended to Second, the Government structuring of the MDTF was overly complicated improve the community’s and did not evolve with program needs, which risked a mismatch between programs and government priorities. LSP managed this risk and ensured economic livelihood by optimal alignment with Government priorities by actively engaging with Bap- providing improved penas, and key Government counterparts, often outside of the formal steer- access for members of the ing committee. The program, including the governance structure, was also re-aligned to allow LSP to better support the Government’s priority development community who work programs in an efficient and effective way. crushing and breaking rocks.” LSP ANNUAL PROGRESS REPORT 2016 25 FU T U R E D IR ECT ION CH APTER 04 Future Direction 04 In 2017 and beyond, LSP will support the Government to implement a village innovation and knowledge- sharing platform under the VIP, further institutionalize Generasi, and continue to support the KIAT Guru project to improve teacher performance. LSP will also provide a multi-sectoral knowledge package of JIT policy advice, analytics, and special studies and policy convening that draws on the local and global expertise of the World Bank’s Social, Governance, Education, Health, and Poverty teams. Each of LSP’s key projects will focus on a specific agenda: The Village Law PASA: This activity will continue to focus on informing and supporting reforms to reduce poverty and improve service delivery. The project will continue to support the Government to revise the village fund allocation formula to ensure that it is more pro-poor and that it promotes increased village spending on activities with high development returns. The project will focus on strengthening village planning, financial management, and oversight so that villages can better manage expenditures and out- puts. It will support improved village leadership and community participation, and identify ways in which the Village Law can help improve access to local economic development opportunities. The project will continue to strengthen M&E to ensure that data and analytics are able to effectively inform key policies and decisions. KIAT Guru: The Government and LSP are in the process of determining whether to extend the current pilot by one year in order to measure the effectiveness of beneficiaries’ longer exposure to the interventions. Consideration is also being given to adapting and expanding the pilot’s community engagement and pay-for-performance mechanisms to urban and semi-urban settings. ECED: In 2017, LSP will support the training of an additional 7,500 community ECED teachers in 25 districts using the district-based training system introduced in 2016. ECED will also conduct M&E activities to inform a feasibility study and dissemination strategy in the second half of 2017. LSP ANNUAL PROGRESS REPORT 2016 F UT U R E D I R EC T I O N CHAPTE R 0 4 26 VIP: LSP will focus on assisting the Government to transform b. Susenas Simulation: LSP will use the results of the final- its approach to providing support and facilitation at the village ized Susenas report to provide inputs to BPS to improve level, with a new emphasis on supporting innovation through: the consumption module and data collection in the future. (i) a district-level village innovation platform that will help insti- These changes will help calculate the national poverty tutionalize the knowledge-sharing functions and lessons of the and inequality rates more accurately, and will thus enable PNPM facilitation and community empowerment activities; (ii) a better targeting of the poor with social protection pro- capacity-building platform for local technical service providers grams. LSP will also provide input to BPS to improve sur- that will improve their ability to deliver technical services to vil- vey implementation, including training quality, instrument lages, with a particular focus on the design and implementation design, and the data entry program. LSP will begin efforts of village entrepreneurship, basic social services, and village to disseminate the results internationally in order to share infrastructure investment; and (iii) support to villages to devel- survey and consumption module best practices learned op and maintain a dataset on basic village development as the from the simulation. basis for planning and monitoring village investment activities. c. Sentinel Villages Study: The study will continue with direct Generasi: In 2017, Generasi will continue supporting the imple- longitudinal field observations as well as special case stud- mentation of its exit strategy, and adjust the project’s design ies as needed (the endline will be 2018). Issues to explore in the context of Village Law implementation. This will include will vary according to national priorities and emerging chal- phasing out community block grants by the end of 2017. The lenges in the field, but may include: (i) the use of village project will facilitate evidence-based policy dialogues and funds and who benefits from these funds; (ii) challenges workshops involving key stakeholders to discuss the drafting faced by the village head in using village funds for invest- of regulations that fall under the Village Law. ments that have better socio-economic impacts; and (iii) natural resource management challenges. M&E and Special Studies: In 2017, LSP will focus its M&E ac- d. Generasi Long Term IE: The results from this evaluation tivities on the following five areas: will determine whether Generasi has directly improved a. Civil Service Data Analysis: LSP received the personnel maternal nutrition, reduced stunting and wasting, and records of 4.3 million former civil servants and 4.5 million enhanced the quality of maternal health services over the active civil servants from BKN (National Civil Servant Orga- course of the nine-year project. The LSP team will work nization), and will continue data analysis as planned. The with the Generasi IE Steering Committee to disseminate analysis will include the geographical distribution of civ- the findings to key government stakeholders. These find- il servants, diversity in government agencies/institutions, ings are expected to influence the Government’s priorities and a profile of frontline service providers. LSP also plans for Village Law expenditures. The analysis will also yield to analyse factors that influence promotion and retire- detailed gender-disaggregated data on health and other ment projections, as requested by BKN and the Ministry of gender-related outcomes, including early marriage and National State Apparatus (KemenPAN). Results from the teenage births, to inform future policy direction. analysis will be disseminated regularly to BKN and Kemen- PAN as inputs to policy and programs related to improving the quality of civil servants. “In the village of Loloan, in North Lombok, the village government has used village funds to revitalize housing for indigenous people in two hamlets, Tanah Petak Daya and Lobang Kodek. By providing these funds, the village government aims to improve the quality of life of members of the indigenous community.” LSP ANNUAL PROGRESS REPORT 2016 27 FIN A N CIA L OV ERV IEW ANNEX 01 Annex 01 Financial Overview Pledges and Contributions As of December 31, 2016, donors have pledged US$354 million and paid-in US$334 million to the MDTF. TABLE 1 Pledges and Contributions, 2008—16 YEAR CUMULATIVE PLEDGE CUMULATIVE PAID-IN (US$) (US$) 2008 58,624,324 22,952,786 2009 67,391,804 40,758,460 2010 91,192,810 66,405,644 2011 125,279,210 117,980,136 2012 211,601,860 169,577,336 2013 343,203,780 270,775,798 2014 359,605,550 298,071,701 2015 359,605,550 310,171,661 2016 354,205,5208 334,324,996 Execution Funds are executed by the Government, NGOs, and the World Bank. The majority of the funds (67 percent) are executed by the Government, followed by the World Bank, and NGOs. FIGURE 3 Share of Funds Contributed to LSP in 2016 27% 67% Government 8 The Netherlands pledged $37 million but only contributed 6% NGO WB $32 million before withdrawing from the MDTF. LSP ANNUAL PROGRESS REPORT 2016 F I NAN C I A L OV ERV I EW ANNE X 0 1 28 Disbursement As of the end of 2016, the MDTF had disbursed a total of US$286 million9. In the 2016, the MDTF disbursed approximately US$34 million. FIGURE 4 MDTF Disbursement History TOTAL DISBURSEMENT (US$ MILLION) 286 253 222 181 126 80.5 36 2 8.5 2008 2009 2010 2011 2012 2013 2014 2015 2016 TABLE 2 Program Expenditures by Executing Agency (US$) Government Cumulative Dis- ACTIVITY Closing STATUS Grant Amount Disbursement bursement as of NAME Date (US$) 2016 (US$) Dec 31, 2016 (US$) National Program for Community 31 Dec 17 Active 121,772,086 26,222,600 98,950,218 Empowerment in Rural Areas Healthy and Bright Generation (Generasi Sehat Cerdas) Settlement Rehabilitation and 31 Dec 13 Closed 399,645 - 399,645 Reconstruction Project (Rekompak) PNPM Urban III – Disaster 31 Dec 12 Closed 1,344,209 - 1,344,209 Management Support ID-TF PNPM Generasi 31 Dec 14 Closed 67,236,714 (44,934) 67,236,714 (Community CCT) Scale-Up Cofinancing Grant to PNPM 31 Dec 12 Closed 30,682,561 - 30,682,561 for Decentralized Management of Natural Resources and Renewable Energy Integrated Management Infor- 30 Nov 14 Closed 946,381 - 946,381 mation System (MIS) for PNPM Mandiri –SIMPADU (Phase 2) Project PNPM Village Training 31 Dec 15 Closed 20 (284,941) 20 Program Project TOTAL 222,381,615 25,892,725 199,559,747 9 This amount excludes the administration fee of 1 percent, which was deducted by World Bank headquarters from the donors’ paid-in contribution. As of December 31, 2016, the total administration fee was US$ 3,343,250. LSP ANNUAL PROGRESS REPORT 2016 29 FIN A N CIA L OV ERV IEW ANNEX 01 NGO Cumulative Dis- ACTIVITY Closing STATUS Grant Amount Disbursement bursement as of NAME Date (US$) 2016 (US$) Dec 31, 2016 (US$) KIAT Guru Implementation 31 Dec 17 Active 3,623,000 860,272 860,272 PNPM – Pro-Poor Planning, 30 Jun 15 Closed 1,664,643 - 1,664,643 Budgeting and Monitoring (P3BM) Barefoot Engineers Training III 31 Dec 14 Closed 3,928,871 - 3,928,871 Project PNPM GREEN Awareness Raising 30 Jun 13 Closed 265,000 - 265,000 Project in Sumatera ID-TF PNPM Community 31 May 10 Closed 945,000 - 945,000 Facilitator Development Program Support Facility for the National 31 Dec 12 Closed 2,295,400 - 2,295,400 Program for Community Develop- ment/ PNPM, Environmental Pilot Project –‘Green’ PNPM ID-TF PNPM Peduli Executing 31 Dec 13 Closed 2,365,047 - 2,365,047 Organization: Association for Community Empowerment PNPM Peduli Executing 30 Nov 14 Closed 2,028,063 - 2,028,063 Organization: Lakpesdam Project ID-TF PNPM Peduli Executing 30 Nov 14 Closed 3,835,078 - 3,835,078 Organization: Kemitraan TOTAL 20,950,103 860,272 18,187,374 World Bank ACTIVITY Closing STATUS Grant Amount Disbursement Cumulative Dis- NAME Date (US$) 2016 (US$) bursement as of Dec 31, 2016 (US$) ID-TF VIP Supervision and Mon- 31 Mar 18 Active 8,546,270 780,167 7,662,635 itoring ID-TF M&E and Special Studies 31 Dec 17 Active 12,841,000 533,316 11,632,658 ID-TF Generasi Sehat Cerdas 31 Dec 17 Active 8,220,433 736,089 6,597,100 (Community CCT) Pilot Program ID-TF LSP – Operations 31 Mar 18 Active 13,940,519 900,529 7,177,814 KIAT Guru Supervision and 28 Feb 18 Active 315,000 80,740 80,740 Monitoring KIAT Guru – Improving Teacher 31 Dec 17 Active 785,000 74,725 74,725 Performance and Accountability Development Challenge Nudges 28 Feb 18 Active 1,555,820 23,048 23,048 & Community-based Nudges Village Law PAAA – Governance 31 Dec 17 Active 1,700,000 428,107 444,445 Sub-tasks Village Law PAAA Project 31 Dec 17 Active 4,400,000 1,441,692 2,054,502 Enhancing Technical Skills for 28 Feb 18 Active 300,000 2,003 2,003 Poverty Analysis Indonesia Urban Poverty 28 Feb 18 Active 907,230 61,467 61,467 Assessment LSP ANNUAL PROGRESS REPORT 2016 F I NAN C I A L OV ERV I EW ANNE X 0 1 30 Impact Evaluation of PNPM Generasi 31 Dec 17 Active 2,018,194 884,651 926,861 M&E and Accountability Tools/ 31 Dec 17 Active 300,000 - - Diagnostics Collaborative District Problem Solving 31 Dec 17 Active 400,000 63,083 63,083 Improving Data to Deliver Results 28 Feb 18 Active 750,000 1,031 1,031 in Service Delivery Youth & Female Unemployment 28 Feb 18 Active 246,236 110,729 10,729 in Indonesia ECED Frontline – Training 24 Dec 17 Active 1,650,000 575,688 575,688 Enhancement and Dissemination ECED Frontline – Evaluation 31 Dec 17 Active 1,200,000 - - Susenas Consumption Experiment 31 Dec 16 Active 170,000 137,459 137,459 ID-TF PNPM Communication 24 Nov 15 Closed 4,317811 - 4,317,811 Strategy Village Training Project 31 Dec 15 Closed 393,621 7,066 393,621 National Program for Communi- 31 Mar 15 Closed 4,099,916 (1,380) 4,099,916 ty Empowerment (PNPM) Field Operations ID-TF PNPM Supervision and 31 Dec 12 Closed 788,030 - 788,030 Monitoring (Urban) Training of Local Auditor (Inspek- 31 Oct 11 Closed 288,031 - 388,031 torat Kota/Kabupaten) in PNPM Mandiri Perkotaan Barefoot Engineers Training III 31 Dec 14 Closed 68,032 - 68,032 Technical Assistance and Support 31 Mar 15 Closed 2,987,615 - 2,987,615 to Bappenas and Kemenko Kesra (Pokja Pengendali PNPM Mandiri) ID-TF PNPM WINDOW 3 PHASE I 31-Aug-11 Closed 166,816 - 166,816 National Program for Community 31-Dec-15 Closed 1,458,948 3,056 1,458,948 Empowerment (PNPM) Window 3 – PNPM Peduli Phase II PNPM Disabled Persons 31 Dec 15 Closed 576,640 - 576,640 Organizations Window Program ID-TF Local Government Capacity 30 Jun 13 Closed 1,717,026 - 1,717,026 Development Delivering Poverty Services to 30 Jun 12 Closed 765,257 - 765,257 Poor Communities PNPM Mandiri Revolving Loan 30 Apr 15 Closed 9,926,775 - 9,926,775 Fund (RLF) Capacity-Building and Sustainability Project Indonesia Urban Poverty Analysis, 28 Feb 13 Closed 633,374 - 633,374 Program Review and PNPM–Urban Evaluation Cofinancing Grant to PNPM for 30 Dec 13 Closed 730,400 - 730,400 Decentralized Management of Natural Resources and Renew- able Energy PNPM: Poverty Engagement, 30 Jul 12 Closed 1,999,785 - 1,999,785 Knowledge and Action TOTAL 91,163,779 6,743,265 68,444,064 LSP ANNUAL PROGRESS REPORT 2016 31 ON G OIN G A N D P LA N N ED EVA L UATIO NS ANNEX 01 Annex 02 Ongoing and Planned Evaluations FIGURE 5 Summary of Completed and Expected Analytical Outputs Outcome 1: Improved Community Participation in Local Solutions to Poverty Project Intermediate Target Target Current Traffic Comments Outcome Number year (as of Light / Per- CY16) (status) centage ECED Percentage of targeted villages 85% 2017 50% On track submitting proposals in support of early childhood education and development, especially for teacher training Generasi Percentage of women involved 75% 2017 65% On track in the village planning process Percentage of funds in the vil- 10% 2017 5.4% On track Current data as of 2016 lage budget allocated to health is from first year imple- and education services delivery mentation of Generasi integration pilot in NTB. KIAT Guru Improved community satisfaction Scores 2017 N/A At risk Delayed timeline, but on teacher service quality demon- expecting achievement O u tc o m e 1 I n d i c ato r s strate of target by end of 2017. improve- ment from Baseline data have been baseline collected in 213 (of 270) schools, data have not been analyzed. VIP Beneficiaries in project locations N/A N/A N/A N/A This indicator is not ap- feel that village investments plicable for the current meet their needs (disaggregated reporting timeframe by gender) as PNPM Rural has transitioned to the VIP in 2016. However, this indicator is currently under discussion for potential inclusion in the future. Communities involved in partic- N/A N/A N/A N/A This indicator is not ap- ipatory and democratic forums plicable for the current for planning, implementing and reporting timeframe overseeing initiatives directly as PNPM Rural has addressing local development transitioned to the VIP priorities in 2016. However, this indicator is currently under discussion for potential inclusion in the future. LSP ANNUAL PROGRESS REPORT 2016 ONGO I N G A N D P LA N N ED EVA LUAT ION S ANNE X 0 2 32 Outcome 2: Strengthened Sub-national Governance and Capability to Plan and Implement Local Solutions to Poverty Project Intermediate Target Target Current Traffic Comments Outcome Number year (as of Light / Per- CY16) (status) centage ECED Number of piloted districts in 25 2017 10 On track 2016 target of 10 districts which teacher training package was reached. Project is is conducted using enhanced on track to expand to all materials 25 districts in 2017. Number of ECED community 15,000 2017 7,797 On track 2016 target of 7,500 was teachers who have completed exceeded. Project is on teacher training package (target track to reach 15,000 15,000) teachers by end of 2017. Number of district-nominated 150 2017 260 On track 2017 target was reached trainers who have been trained by in 2016. MoEC using their budget Generasi Number of sub-districts that are 369 sub- 2017 48 sub- On track The expansion based part of the expansion from the districts in districts in on the NTB Village Law Village Law transition pilot 8 provinc- 1 province integration pilot in 2016 es (NTB) is targeted to take place in all 369 sub-districts in 8 provinces starting in 2017. O u tc o m e 2 I n d i c ato r s Percent of sub-districts conducting 80% 2017 100% Completed All activities have been planning/coordination workshops conducted at the with district health and educa- national and sub-national tion offices to discuss Generasi levels. activities Number of service units (posyan- 20,336 N/A 20,336 N/A Current data show the du) that have improved institu- number of all posyandus tional/organizational capacity to in 499 sub-districts in 11 address frontline service needs provinces in Generasi locations that have received a Generasi block grant. Since this indicator is not originally a Generasi indicator, there is no target year and number as well as baseline data. As such, there are no data on the improvement of the posyandu capacity, since measuring this requires a baseline and endline data. Nevertheless, we assume that training, provision of equipment, and financial subsidies for health cadres from the block grants must produce an improve- ment in capacity. LSP ANNUAL PROGRESS REPORT 2016 33 ON G OIN G A N D P LA N N ED EVA L UATIO NS ANNEX 01 Generasi Percent of district governments 50% 2017 60% On track 2017 target was exceed- that have conducted supervision ed in 2016. The local to communities as planned government supervised Generasi’s implementa- tion, supported by the local budget (APBD). KIAT Guru Increased the percentage of Increased 2017 N/A At risk Delayed timeline, but teacher presence rate 7.5% from should be attainable by baseline end of 2017. Baseline data have been collected in 213 (of 270) villages, but have not been analyzed. Percentage of villages assigned 80% 2017 20% At risk Delayed timeline, but the CEM (community empower- should be attainable by ment mechanism) models that end of 2017. have completed the initial phase The initial phase of CEM outcomes consists of setting up a service agreement, community scorecard, and user O u tc o m e 2 I n d i c ato r s committee. Because the baseline is still ongoing, the percentage of villag- es that have completed this phase is only 20%. VIP Villages with high-quality tech- N/A N/A N/A N/A This indicator is not nical plans for village spending applicable to the current on investments supported by the reporting timeframe, as project PNPM Rural transitioned to the VIP in 2016. How- ever, this indicator is cur- rently under discussion for potential inclusion in the future. Districts with functional village in- N/A N/A N/A N/A This indicator is not novation and knowledge sharing applicable to the current platform reporting timeframe, as PNPM Rural transitioned to the VIP in 2016. How- ever, this indicator is cur- rently under discussion for potential inclusion in the future. Village Number of facilitated exchanges 3 2017 2 On track 1) BPD regulation (Per- Law PASA of best practices with district mendagri 110/2016) governments 2) Village Development Regulation (Permend- agri 114/2016) LSP ANNUAL PROGRESS REPORT 2016 ONGO I N G A N D P LA N N ED EVA LUAT ION S ANNE X 0 2 34 Outcome 3: Improved National Systems and Enabling Environment to Guide, Encourage, and Support Local Solutions to Poverty Project Intermediate Target Target Current (as Traffic Comments Outcome Number / year of CY16) Light Percentage (status) KIAT Guru Issuance of Issuance of the 2017 1 DG decree on On track There are certain regulations relevant govern- following types National Coordi- that need to be issued at the ment regula- of regulations nation Team; national, district, and village tions and decrees: 5 Bupati de- levels in order for KIAT Guru MoU, national, crees on District to operate. It is difficult to district, and Coordination estimate the number of regu- village Team; lations that need to be issued, 5 MoU between since every district has differ- MoEC, TNP2K, ent requirements. The types and district gov- and numbers of regulations ernments will continue to be tracked throughout 2017. M&E Number of find- 4 2016 4 Completed Completed 1) Policy brief BPD (disseminat- ings from evalu- 1 in revision ed to the Government) ations launched 2) PNPM Rural report in 2014 and 3) PEKKA report I (quantitative) 2015 reviewed 4) PEKKA report II (qualitative as part of PNPM – still in revision) transition or 5) Creative Communities II –its O u tc o m e 3 I n d i c ato r s Village Law evaluation has been imple- implementation mented by Yayasan Kelola process (Creative Communities II Grant Recipient). Number of new 3 2016 1 Completed Completed 1) Sentinel Villages Study ‘14-’15 studies 3 Ongoing 2) Civil service database launched analysis 3) Generasi IE 4) Disaster management sup- port (DMS) (completed) Percentage 100% 2016 100% Completed 1) Sentinel Villages with SME- of ongoing RU studies involv- 2) Generasi IE with J-PAL Indo- ing Indonesian nesia and PSKK UGM social research 3) Susenas simulation with organizations STIS (BPS) to conduct M&E 4) Civil service data with Gov- and special ernment (BKN) staff studies 5) PEKKA with PSKK UGM. VIP Villages with ac- N/A N/A N/A N/A This indicator is not applica- cess to qualified ble to the current reporting technical ser- timeframe, as PNPM Rural vices supported transitioned to the VIP in by the project 2016. However, this indicator is currently under discussion for potential inclusion in the future. LSP ANNUAL PROGRESS REPORT 2016 35 ON G OIN G A N D P LA N N ED EVA L UATIO NS ANNEX 01 VIP Villages with N/A N/A N/A On track This indicator is not applica- functional data- ble to the current reporting set on entrepre- timeframe, as PNPM Rural neurship, basic transitioned to the VIP in services, and 2016. However, this indicator infrastructure is currently under discussion for potential inclusion in the future. Village Law Number of 25 2017 81 On track 2015: 9 PKAD (village appa- PASA implementing ratus) training modules, 2 regulations, Guidelines (DJ-PPMD), 2 PP guidelines, revisions (PP 43 and PP 60), 1 and modules PMK revision (working on it to informed by become a presidential decree policy and tech- in monitoring the Village Law nical advice implementation), 5 Permendes revisions (Permendes 1,2,3,4, and 5), 1 Permendes on DD Priority 2016: 10 PAD (village appa- O u tc o m e 3 I n d i c ato r s ratus) training modules, 10 preservice training modules for District Community Empow- erment Facilitators (TAPM), 1 module for District Village Infrastructure Facilitators, 10 preservice training modules for Subdistrict Facilitators (PD), 4 preservice (additional) training modules for Subdistrict Community Empowerment Facilitators (PD), 5 preservice (additional) training modules for Subdistrict Technical Infra- structure Facilitators (PD), 5 preservice training modules for Village Facilitators, 9 training modules for Village Govern- ment Technical Facilitators (PTPD), 3 Permendes (Per- mendes 9/2016 on Community Training, Permendes 22/2016 to 4/2017 on DD Priority, and I11Permendes 3/2015 on Village Facilitation), 1 Permend- agri (Permendagri 110/2016 on BPD), 1 input to the curriculum of Pelayanan Sosial Dasar (Delivery Services) in refresher training PNPM Generasi, 1 Vil- lage Development Guidebook (with KOMPAK), and 1 support for Siskeudes. LSP ANNUAL PROGRESS REPORT 2016 ONGO I N G A N D P LA N N ED EVA LUAT ION S ANNE X 0 2 36 VIP Number of 30 2017 23 On track 2015: 12 policy dialogues with policy KSP, TNP2K, Menko, and PMK O u tc o m e 3 I n d i c ato r s dialogues on 2016: 11 policy dialogues Village Law (and with MoF DJPK (Permendagri rural closure) in- 113/2015, DD allocation formu- formed by field la, DD disbursement survey), supervisions, MoHA (BPD regulation, Village system reviews, Development regulation, Vil- and studies lage Financial Oversight regu- lation – with BPKP), Bappenas (Village Public Expenditure Re- view, ViPER), MoV (Community training regulation and ViPER) LSP ANNUAL PROGRESS REPORT 2016 37 Ac k n ow l e d g e m e n t s This report was prepared by the LSP Secretariat with contributions from the Coordinating Ministry for Human Development and Cultural Affairs, Ministry of Villages, Disadvantaged Regions and Transmigration, Ministry of Home Affairs, Ministry of Public Works, Ministry of Finance, the National Development Planning Agency, as well as the LSP project teams. Program Manager: Kevin Tomlinson Secretariat Task Team Leader: Daniel Yusanto Annual Report Team Leader: Derrick Pfeffer Lead Writer: Irfan Kortschak Editorial Support: Kelley Friel Graphic Designer: Phoebe Wathoel Team Contributors: Adji Danya Hakim (Village Law), Alexander Setiadji (Rural and Village Law), Audrey Sacks (Analytics and Gender), Bambang Soetono (Rural and Village Law), Budi Wijoyo (Generasi), Chatarina Ayu Widiarti (Secretariat), Christopher Finch (Village Law), Dewi Susanti (KIAT Guru), Fauzan Ijazah (Photographer), Fibria Heliani (Communications), Gerda Gulo (Generasi), Gregorius Pattinasarany (M&E), Hera Diani (Communications), Jane Tjahjono (Village Law and M&E), Lily Hoo (M&E), Octaviera Ratna Herawati (Rural), Rosfita Roesli (ECED), Sam Clark (Village Law, Generasi and Rural), Thomas Brown (ECED), and Wulan Dewi (Communications). LSP ANNUAL PROGRESS REPORT 2016