Program Keluarga Harapan : impact evaluation of Indonesia's Pilot Household Conditional Cash Transfer Program

 72506 Program Keluarga Harapan Main Findings from the Impact Evaluation of Indonesia’s Pilot Household Conditional Cash Transfer Program World Bank Office Jakarta June 2011 Acknowledgments This report was prepared by the Poverty Team, part of the Poverty Reduction and Economic Management (PREM) group in the World Bank Office Jakarta. Vivi Alatas, the Task Team Leader, led the analytical activities and oversaw the preparation of the report. She was supported by a team that included: Nur Cahyadi, Elisabeth Yunita Ekasari, Sarah Harmoun, Budi Hidayat, Edgar Janz, Jon Jellema, Hendratno Tuhiman, and Matthew Wai-Poi. The University of Gadjah Mada (UGM), Center for Public Policy Studies, implemented the baseline and final survey. The analysis for this evaluation was based on survey data that was collected and processed by some 860 enumerators and researchers. The survey work was led and overseen by Susan Wong. This report also draws from the findings of the resulting 2007 baseline survey report written by Robert Sparrow, Jossy Moeis, Arie Damayanti and Yulia Herawati. The Center for Health Research at the University of Indonesia, with the support of partner universities across the country, prepared a report in 2010 on the implementation of Program Keluarga Harapan (PKH), based on qualitative and quantitative spot-checks of the program. In addition, SMERU, an independent research organization in Indonesia, provided complementary qualitative studies in 2007 and 2009. These excellent reports have contributed to efforts to better understand how PKH works and contribute to reform efforts. Their work complements the findings from this impact evaluation, providing inputs for policy makers responsible for oversight and expansion of the program. Financial support for the survey comes from the Government of Indonesia, the Royal Embassy of the Netherlands, the World Bank, and the World Bank PNPM Support Facility, which is supported by the governments of Australia, the United Kingdom, the Netherlands, and Denmark, as well as a contribution from the Spanish Impact Evaluation Fund. Peer reviewers were: Emanuela Galasso, Margaret Grosh, Joppe Jaitze De Ree, and Rebekah Pinto. This report also benefited from valuable comments from Benjamin Olken (M.I.T., Department of Economics) and Susan Wong. The Government of Indonesia has provided excellent leadership in designing and implementing PKH. The National Development Planning Agency (Bappenas) has been instrumental in overseeing the development of the pilot and assessing its implementation, which was carried out by the Ministry of Social Affairs (Kemensos) and the national postal agency, PT Pos. The Secretariat for the National Team for the Acceleration of Poverty Reduction (Tim Nasional Percepatan Penggulangan Kemiskinan, TNP2K) has played an important role in providing policy leadership for program improvements and expansion. Special thanks to: Prasetijono Widjojo and Pungky Sumadi, Rudy Prawiradinata, Endah Murniningtyas, Vivi Yuliswati, Woro S. Sulistyaningrum, Arum, Srihartati, Pungkas Baijuri Ali (Bappenas); Sujana Royat (Kemenkokesra); Akifah Elansary, Gaol Lumban, Heru Sukoco (Kemensos); Wynandin Imawan (BPS); Bambang Widianto (TNP2K Secretariat). The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors, or the countries they represent. The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. Table of Contents Acknowledgements Table of contents ………………………………………………………………………………………………………………………………….. ii Abbreviations, Acronyms and Terms .......................................................................................................... iv Executive Summary ……………………………………………………………………………………………………………………………. 6 Chapter 1 Introduction ……………………………………………………………………………………………………………………… 9 Chapter 2 Program Design …………………………………………………………………………………………………………………. 10 I. Program Background ………………………………………………………………………………………………………… 10 II. Program Objectives ………………………………………………………………………………………………………….. 11 III. Geographic Targeting ……………………………………………………………………………………………………….. 14 IV. Beneficiary Selection ………………………………………………………………………………………………………… 17 V. Transfer Delivery and Verification Mechanism …………………………………………………………………. 17 VI. Complementary Programs …………………………………………………………………………………………………19 Chapter 3 Program Implementation Assessment ………………………………………………………………………………. 21 I. Program Socialization ………………………………………………………………………………………………………. 21 II. Verification Systems …………………………………………………………………………………………………………. 21 III. Adequacy and Timing of Payments……………………………………………………………………………………. 22 IV. Inter-Agency Coordination ………………………………………………………………………………………………. 23 V. Improvements in Implementation ……………………………………………………………………………………. 24 Chapter 4 Program Evaluation Design …………………………………………………………………………………………………..25 I. Evaluation Indicators ………………………………………………………………………………………………………….25 II. Sample Construction ………………………………………………………………………………………………………… 26 III. Data Sources …………………………………………………………………………………………………………………….. 29 IV. Methodology ……………………………………………………………………………………………………………………. 31 Chapter 5 Main Results ………………………………………………………………………………………………………………………..32 I. Household Welfare……………………………………………………………………………………………………………. 32 II. Health Behaviours and Outcomes …………………………………………………………………………………….. 32 III. Education & Child Labor …………………………………………………………………………………………………… 34 IV. Disaggregated Results ………………………………………………………………………………………………………. 35 Chapter 6 Program Cost effectiveness ………………………………………………………………………………………………… 39 Chapter 7 Recommendation ……………………………………………………………………………………………………………….. 41 References ………………………………………………………………………………………………………………………………………….. 43 Annex A: Indicator Definitions …………………………………………………………………………………………………………….. 45 ii Annex B: Baseline Balance Test Results ………..…………………..……………………………………………………………….. 47 Annex C: Propensity Score Matching ………………………………….………………………………………………………………. 60 Annex D: Methodology …………………………………………………………………………..…………………………………………… 64 Annex E: Main Results ………………………………………..……………………………………………………………………………….. 75 Annex F: Robustness Check …………………………………………………………..………………………………………….…………. 83 Annex G: Disaggregated Results …………………………………………………………..……………………………………………… 87 iii Acronyms, Abbreviations & Indonesian Terms ARI Acute respiratory infection Askeskin Asuransi Kesehatan Miskin (Health Insurance for the Poor) Bappenas Badan Perencanaan dan Pembangunan Nasional (National Development Planning Agency) Bidan Mid-wife BLT Bantuan Langsung Tunai (unconditional cash transfer program) BOK Bantuan Operational Kesehatan (Operational Health Assistance Program) BOS Bantuan Operasional Sekolah (School’s Aid Program) BPS Badan Pusat Statistik (Statistics Indonesia) BULOG Badan Urusan Logistik (Logistic Agency) CCT Conditional cash transfer Desa Village DKI Daerah Khusus Ibukota (Special Capital Territory) DPT Diphtheria, pertussis (whooping cough) and tetanus Dusun Rural ward (sub-village) GOI Government of Indonesia IP Infrastruktur Pedesaan (Rural Infrastructure Program) Jamkesmas Jaminan Kesehatan Masyarakat (health insurance scheme for the population) JSLU Jaminan Sosial Lanjut Usia (social cash transfer for the elderly) JSPACA Jaminan Social Penyandang Cacat Berat (Social cash transfer for the disabled) Kabupaten District KDP Kecamatan Development Project Kecamatan Sub-district Kelurahan Urban precinct Kemdiknas Kementerian Pendidikan Nasional (Ministry of National Education) Kemenag Kementerian Agama (Ministry of Religious Affairs) Kemenkes Kementerian Kesehatan (Ministry of Health) Kemenkokesra Kementerian Koordinator Kesejahteraan Rakyat (Coordinating Ministry for Social Welfare) iv Kemenkominfo Kementerian Komunikasi dan Informatika (Ministry of Communications and Information Technology) Kemensos Kementerian Sosial (Ministry of Social Affairs) MDG Millennium Development Goals MIS Management Information System NTT Nusa Tenggara Timur (East Nusa Tenggara province) PAM Perusahaan Air Minum (public water utility) PKH Program Keluarga Harapan (Hopeful Family Program) PKPS-BBM Program Kompensasi Pengurangan Subsidi Bahan Bakar Minyak (compensation program for the reduction of oil energy subsidies) PKSA Program Kesejahteraan Sosial Anak (children’s social welfare program) PLN Perusahaan Listrik Negara (State Electricity Company) PMT Proxy-means test PNPM-Generasi PNPM Generasi Sehat dan Cerdas (PNPM Healthy and Smart Generation Program) PNPM-Mandiri Program Nasional Penberdayaan Masyarakat Mandiri (National Community Empowerment Program) PODES Potensi Desa (Village Potential Statistics) Posyandu Pos Pelayanan Kesehatan Terpadu (Integrated [health] service post) PPLS Pendataan Program Perlindungan Sosial (Data collection for [targeting] social protection programs PT Pos National post office Puskesmas Pusat Kesehatan Masyarakat (community health center) Raskin Beras Miskin (program for sale of subsidized rice for the poor) Rp Indonesian Rupiah RPJMN Rencana Pembangunan Jangka Menengah (national medium-term development plan) RTSM Rumah Tangga Sangat Miskin (extremely poor households) SD Sekolah Dasar (primary school) SMP Sekolah Menengah Pertama (junior secondary school) TNP2K Tim Nasional Percepatan Penanggulangan Kemiskinan (National Team for the Acceleration of Poverty Reduction) UGM University of Gadjah Mada UPP Urban Poverty Program UPPKH Unit Pelaksana Program Keluarga Harapan (PKH Implementation Unit) v Executive Summary In 2007, the Government of Indonesia launched its first household-based conditional cash transfer program: Program Keluarga Harapan (PKH, or the Hopeful Family Program). The program is intended to improve the welfare of extremely poor households by providing them with quarterly cash transfers ranging from Rp 200,000 to Rp 600,000 per quarter. At the same time, the program is designed to break the transmission of poverty to next generations by encouraging families to increase their use of public services to, over time, improve the health and education outcomes of their children. It does this by providing the transfer only to households with pregnant women and/or children, provided that they fulfill specific health and education-related obligations. The implementing agency, the Ministry of Social Affairs (Kementerian Sosial, Kemensos) initially provided benefits to 432,000 “extremely poor