Services for the People, by the People: Indonesia's Program for Community Empowerment, 1998-2006

When financial crisis and weather-related natural disasters ravaged Indonesia’s economy in 1997, national leaders searched for ways to cushion the impact on poor rural households. A team of public servants within Bappenas, the country’s powerful national development planning agency, suggested an aggressive, nationwide expansion of an experiment in community-driven development. The Kecamatan Development Program (KDP), which worked at the kecamatan, or subdistrict, level, furnished block grants directly to poor communities and empowered villagers to determine how they wanted to use the funds—whether for building roads, bridges, schools, or health clinics. Communities chose, planned, implemented, and maintained projects on their own, supervised by village volunteers, subdistrict committees and verification teams, and specially trained facilitators. Planners at Bappenas worked with the World Bank to modify and scale up the original KDP experiment. The Ministry of Home Affairs, which also participated in the early phases, took over the program two years later. During an eight-year period, the new KDP provided direct benefits for more than half of Indonesia’s 70,000 villages, helping communities move out of poverty in greater proportions than their counterparts in non-KDP areas did.

This teaching case is available here.

Authored by Rushda Majeed.

Published by Innovations for Successful Societies.