A N NUAL PROGRESS REPO RT 2018 The World Bank Lo c a l S o lu t i o n s to P ov e r t y The World Bank Office Jakarta Indonesia Stock Exchange Building, Tower II/12th Floor Jl. Jend. Sudirman kav. 52-53 Jakarta 12190 P (6221) 5299-3000 F (6221) 5299-3111 W www.localsolutionstopoverty.org This publication is a product of the Local Solutions to Poverty Facility. R i g h t s & P e r m i ss i o n s The material in this publication is subject to copyright. Because The World Bank encourages dissemination of its knowledge, this publication may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given. Nothing herein shall constitute or be considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. 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 2017 1 CONT E NTS Table of Contents 01 Executive Summary 6 02 Introduction 9 03 LSP Context 11 3.1 LSP’s Operating Context and Progress in the Broader Sector 11 12 3.2 LSP’s Operational Framework: The Theory of Change 3.3 Key LSP Programs and Activities 14 04 Progress towards EOFO One: Local Governments 16 Become More Responsive and Inclusive 4.1 Outcome 1: Strengthening local frameworks and systems to improve governance and downward accountability to communities 16 4.2 Outcome 2: Communities have more effective and structured participation at the village level 19 4.3 Outcome 3: Local governments have development plans and budgets that better reflect community needs, including women and the poor 24 05 Progress towards EOFO Two: Beneficiaries 27 Receive Improved Basic Service Delivery 5.1 Outcome 1: Beneficiaries experience increased equity of access to services 28 5.2 Outcome 2: Beneficiaries increasingly utilize services 30 5.3 Outcome 3: Beneficiaries have improved quality of health and education services 33 06 Progress towards EOFO Three: National 36 and Local Governments Make Better Use of Financial Resources 6.1 Outcome 1: Strengthen national frameworks and systems for tracking village finances and outputs 37 39 6.2 Outcome 2: Pilot villages demonstrate financial allocations that are equitable, needs-based and pro-poor 6.3 Outcome 3: Village communities and government have improved capacity to manage increased finances 40 6.4 Outcome 4: Data-driven planning and budgeting at the local level are strengthened 41 C O N T E N TS 2 07 Gender and Social Inclusion 42 08 Key Challenges, Lessons Learned and Risks 45 8.1 Key Challenges and Lessons Learned 45 8.1.1 Fragmented coordination and varied levels of commitment among counterparts 45 8.1.2 Partner in human resourcing and capacity building 46 8.2 Risks 46 09 Future Directions 48 Annexes 50 Annex 1: Theory of Change 2017 50 Annex 2: Financial Overview 51 Annex 3: Activity Implementation Summary (Planned vs Actual Activities) 56 3 ABBR EVIATIONS & ACR ONY M S Abbreviations and Acronyms AA Affirmative Allocation Keuangan Kementerian Keuangan ADD Alokasi Dana Desa (Directorate General of Fiscal Balance, (Village Funds Allocation) Ministry of Finance) APBD Anggaran Pendapatan dan Belanja DJ PPMD Direktorat Jenderal Pembangunan dan Daerah (Regional Budget) Pemberdayaan Masyarakat Desa – Kemendesa PDTT (Directorate General APBDes Anggaran Pendapatan dan Belanja Village Community Development and Desa (Village Budget) Empowerment – Ministry of Village, De- APBN Anggaran Pendapatan dan Belanja velopment of Disadvantaged Regions Negara (State Budget) and Transmigration) Bappenas Kementerian Perencanaan Pemban- DPMD Dinas Pemberdayaan Masyarakat gunan Nasional/Badan Perencanaan dan Desa (Agency of Community and Pembangunan Nasional (National Village Empowerment) Development Planning Agency) DPR Dewan Perwakilan Rakyat (Indonesian BKN Badan Kepegawaian Negara (National Parliament) Civil Servant Organization) DST Daerah Sangat Tertinggal (Significantly BPKP Badan Pengawasan Keuangan dan Disadvantaged Region) Pembangunan (Finance and Develop- DT Daerah Tertinggal (Disadvantaged ment Supervisory Agency) Region) BPD Badan Permusyawaratan Desa (Village ECED Early Childhood Education and Devel- Council) opment BPS Badan Pusat Statistik (Central Bureau EOFO End-of-Facility Outcome of Statistics) ETP Executive Transformation Program BTOR Back to Office Report FGD Focus Group Discussion Bupati Head of District FM Financial Management CDD Community Driven Development GoI Government of Indonesia CGAP Country Gender Action Plan GoA Government of Australia CSO Civil Society Organization GMT Grand Master Trainer DD Dana Desa (Village Funds) HDW Human Development Worker DFAT Australian Government’s Department of Foreign Affairs and Trade IE Impact Evaluation DG Directorate General IG Inspectorate General DGTEP Directorate General for Teachers and IKG Indeks Kesulitan Geografis Education Personnel – Ministry of Edu- (Geographical Difficulty Index) cation and Culture IKK Indeks Kemahalan Konstruksi DJ Bina Pemdes Direktorat Jenderal Bina Pemerintahan (Construction Cost Index) Desa, Kementerian Dalam Negeri INEY Investing in Nutrition and Early Years (Directorate General for Village Gov- Inpres Instruksi Presiden ernment Oversight, Ministry of Home (Presidential Instruction) Affairs) JIT Just in Time DJPK Direktorat Jenderal Perimbangan Kabupaten District AB B R EV I AT I O N S & ACRO N YMS 4 Kecamatan Sub-district LED Local Economic Development KDP Kecamatan Development Program LG Local Government (Pemerintah Daerah) Kepmendesa PDTT Keputusan Menteri Desa, Pembangu- LKD Lembaga Kemasyarakatan Desa nan Daerah Tertinggal dan Transmi- (Village Community Institutions) grasi (Ministerial of Village, Develop- LSP Local Solutions to Poverty ment of Disadvantaged Regions and L/T IE Long Term Impact Evaluation Transmigration Decree) M&E Monitoring and Evaluation Kemenko PMK Kementerian Koordinator Bidang Pem- MCA-I Millenium Challenge Account-Indonesia bangunan Manusia dan Kebudayaan (Coordinating Ministry for Human De- MDTF Multi-Donor Trust Fund velopment and Culture) MELAYANI Menguraikan Permasalahan Perbaikan KemenPANRB Kementerian Pendayagunaan Aparatur Layanan Dasar di Indonesia Negara dan Reformasi Birokrasi (Minis- (Untangling Problems to Improve Basic try of Empowerment of State Apparatus Services in Indonesia) and Bureaucracy Reform) MELP Monitoring, Evaluation and Learning Plan KIAT Guru Kinerja dan Akuntabilitas Guru (Teach- MIS Management Information System ers’ Performance and Accountability) MoEC Ministry of Education and Culture KOMPAK Kolaborasi Masyarakat dan Pelayanan MoF Ministry of Finance untuk Kesejahteraan (Governance for MoH Ministry of Health Growth) MoHA Ministry of Home Affairs KPK Komisi Pemberantasan Korupsi (Corruption Eradication Commission) MoV Ministry of Villages, Development of Disadvantaged Regions and Transmi- KPMD Kader Penggerak Masyarakat Desa gration (Village Development Cadre) MT Master Trainer KSP Kantor Staf Presiden MusDes Musyawarah Desa (Village Meeting) LAD Lembaga Adat Desa (Village Customary Institutions) MusDus Musyawarah Dusun (Hamlet Meeting) LAN Lembaga Administrasi Negara NGO Non-Governmental Organization (State Administration Institution) 5 ABBR EVIATIONS & ACR ONY M S OMSPAN Online Monitoring Sistem Perbenda- PTPD Pendamping Teknis Pemerintahan haraan dan Anggaran Negara (Online Desa (Village Government Technical Monitoring for Treasury System and Facilitators) National Budget Pusdatin Pusat Data dan Informasi (Center of PASA Programmatic Advisory Services and Data and Information) Analytics RIA Regulatory Impact Assessment PAD Pelatihan Aparatur Desa (Training for RPJMN Rancangan Pembangunan Jangka Village Apparatus) Menengah Nasional (National Medium Pamsimas Penyediaan Air Minum dan Sanitasi - Term Development Plan) Berbasis Masyarakat (Water Supply Satgas Satuan Tugas (Task Force) and Sanitation for Low Income Commu- SIPD Sistem Informasi Pembangunan Desa nities) (Village Development Information Sys- Perbup Peraturan Bupati tem) (District Head Regulation) Siskeudes Sistem Keuangan Desa (Village Finance PDT Pembangunan Daerah Tertinggal (De- System) velopment of Disadvantaged Region) Siswaskeudes Sistem Pengawasan Keuangan Desa Permendagri Peraturan Menteri Dalam Negeri (Village Financial Oversight System) (Minister of Home Affairs Regulation) SOP Standard Operating Procedure Permendes Peraturan Menteri Desa (Minister of SSKE South-South Knowledge Exchange Village Regulation) SKB Surat Keputusan Bersama Perpres Peraturan Presiden (Presidential Regu- (Joint Decree) lation) Susenas Survey Sosial Ekonomi Nasional PFM Public Financial Management (National Social Economics Survey) PforR Program for Results TA Technical Assistance PKK Pembinaan Kesejahteraan Keluarga TAPM Tenaga Ahli Pemberdayaan Mas- (Family Welfare Movement) yarakat (Community Empowerment PMK Peraturan Menteri Keuangan (Minister Facilitators) of Finance Regulation) TK Tunjangan Khusus (Teachers’ Special PNPM Program Nasional Pemberdayaan Allowance) Masyarakat (National Community TNP2K Tim Nasional Percepatan Penanggu- Empowerment Program) langan Kemiskinan (National Team for Podes Potensi Desa (Village Potential) the Acceleration of Poverty Reduction) P3MD Program Pembangunan dan Pem- TOR Term of Reference berdayaan Masyarakat Desa (Village TSP Technical Service Provider Community Development and Empow- erment Program) UPK Unit Pengelola Keuangan (Sub-district Financial Management Unit) Posyandu Pos Pelayanan Terpadu (Local Health Service Post) VIG Village Innovation Grants Puskesmas Pusat Kesehatan Masyarakat VIP Village Innovation Program (Community Health Center) ViPER Village Public Expenditure Review PPM Pay for Performance Mechanism VL Village Law PSF PNPM Support Facility C HA P T E R ON E 6 Executive Summary Reducing poverty and inequality are top 01 priorities for Indonesia. Out of a population of 252 million, 35 percent remain poor or vulnerable to falling into poverty. 1 Inequality, while trending down after years of stagnation, is still relatively high; the differences in consumption, access to services, and equality in opportunities be- THE MDTF ALLOWED tween the bottom 40 percent of the poorest segment of the population and middle LSP TO PROVIDE 40 percent remain wide. To continue to move the needle on poverty and inequality in a country as large and diverse as Indonesia requires enabling citizens, villages, local governments (LGs) as well as the private sector to identify and implement local US$ 17 M solutions to these problems. It also requires ensuring that the significant increases in government spending at the local level are more effective and focused on devel- IN GRANT FUNDS TO opment priorities. THE GOVERNMENT TO IMPROVE BASIC The Local Solutions to Poverty (LSP) Multi-Donor Trust Fund (MDTF) enables the H E A LT H & E D U C AT I O N SERVICES FOR World Bank to work at four levels to support the Government of Indonesia (GoI) to enable local development solutions to poverty. First, it works at the highest levels of government to help focus the national policy agenda on reforms and instruments that the national government can use to empower and incentivize local actors to re- duce poverty and inequality. This includes high-level policy dialogue with ministers, 2.1 million tapping into the World Bank’s global expertise as well as using national forums such as the regular Indonesia Economic Quarterly to raise media and public awareness BENEFICIARIES IN of national development priorities. Second, LSP enables the World Bank to pro- 11 PROVINCES vide policy and technical advice to ministerial officials, including at the Ministries of Finance, Planning, Home Affairs, Villages as well as Health and Education. Third, US$ 2.4 M enhanced implementation support assists the GoI to deliver complex and innovative operations, including the Village Innovation Program (VIP), Healthy and Smart Gen- eration (Generasi), Teachers’ Performance and Accountability (KIAT Guru), and the Early Childhood Education and Development (ECED) project. Finally, LSP commis- FOR 203 REMOTE sions special studies, undertakes rigorous impact evaluations, facilitates Knowledge PRIMARY SCHOOLS Exchanges, and leverages the World Bank’s global expertise in community develop- IN 5 PILOT DISTRICTS ment, public financial management (PFM), local economic development (LED), stunt- TO FORM COMMITTEES ing and community health, and impact evaluation. TO MONITOR SCHOOL PERFORMANCE Four major contributions the LSP made in 2017 to support the GoI’s development efforts are: (i) Making four percent of the national budget more pro-poor and service deliv- 1 World Bank, 2017, Aspiring Indonesia: Expanding the Middle Class. ery focused. As a result of LSP led rigorous analytical work and policy dialogue, 2 The Village Fund accounts for approximately 60 the Ministry of Finance (MoF) put forward, and the Indonesian Parliament (Dewan percent of fiscal transfers under the Village Law. In Perwakilan Rakyat, or DPR) approved, a change to the Village Fund2 (Dana Desa) 2017 these transfers amounted to about four per- cent of the national budget. Similar budget levels resource allocation formula for the Village Law. The revised formula allocates are expected in 2018. 7 EXECU TIVE S U M M A RY a greater share of money to villages with higher numbers of poor people, in- cluding those that need basic health, education, economic development and infrastructure services, and in disadvantaged and remote areas. (ii) Generating innovation and learning across Indonesia’s villages to identify solutions to local development challenges and improve the impact of the significantly increased fiscal transfers to district and village governments. There is a high likelihood that for every development challenge with which one of Indonesia’s 74,954 villages is confronted, another village may have an inno- 3 As documented in Perpres No. 42/2013 Gerakan Nasional Percepatan Perbaikan Gizi; Inpres No. vative way to address the same challenge. In recognizing this, LSP leveraged 01/2017 Gerakan Masyarakat Sehat (Germas); and the GoI’s VIP national platform and the Generasi program to provide to the Min- Perpres No. 83/2017 Kebijakan Strategi Pangan istry of Villages, Disadvantaged Regions and Transmigration (MoV), as well as dan Gizi. many provincial and district governments, specialized technical assistance (TA) and implementation support to hold innovation and knowledge exchanges for villages to learn from one another. In 2017, Village Innovation Exchanges (Bursa Inovasi Desa) brought together tens of thousands of villages at the district level across Indonesia, from Papua to Sumatra. (iii) Piloting initiatives to improve the effectiveness and quality of education ser- vice delivery. Indonesia spends 20 percent of its national budget on education, of which half is spent on teacher salaries and allowances. The LSP, through the KIAT Guru project, is tying payment of teachers’ special allowances (Tunjangan Khusus, or TK) to performance in 203 remote primary schools in five districts. The Ministry of Education and Culture (MoEC) issued two ministerial decrees to enable its pilot implementation, and to pave the way for tying TK payments to teacher performance. To help address early childhood development outcomes, particularly in poor rural areas, LSP helped GoI address serious supply side constraints in ECED or, more specifically, the lack of qualified ECED teachers. The LSP ECED pilot project implemented a novel district-based training system, which empowered district governments, civil society, and local communities to train more than 15,000 teachers across 25 districts. The training not only helped improve access to and quality of ECED services in rural areas but also provided women in remote areas with an opportunity to upskill and access formal employ- ment (over 98 percent of the training participants were women). By the end of the pilot project in 2017, demand from villages – including those not covered or financed by the project – increased, and village governments began using their own village budget to procure district-level training for ECED teachers (iv) Developing and launching a multi-sector national strategy to reduce stunting. About 37 percent or approximately nine million children in Indonesia are stunted, which not only affects quality of life but, as international evidence has shown, hampers economic growth and labor market productivity in the long run. The LSP leveraged its access to international expertise and global knowledge (in- cluding a knowledge exchange field trip with key GoI counterparts to Peru to learn about their success in addressing stunting), and its extensive experience with implementing multi-sector programs (such as PNPM, Generasi, the ECED pilot project, and other donor and GoI financed programs such as Pamsimas, which increases access to water and sanitation) to help the GoI develop a Presi- dential National Action Plan to reduce stunting.3 The National Action Plan aims to converge or bring together existing national, regional and community programs to deliver a set of priority nutrition-specific and nutrition-sensitive interventions in the first 1,000 days of a child’s life and up until age six. The GoI have requested a new World Bank operation – Investing in Nutrition and Early Years (INEY) – and additional support from LSP to help implement the Presidential National Action Plan to reduce stunting. C HA P T E R ON E 8 The support of the Australian Government’s Department of Foreign Affairs and Trade (DFAT) and Millennium Challenge Account - Indonesia (MCA-I), which finance the MDTF, made these results possible. In 2017, the MDTF allowed LSP to provide US$17 million in grant funds to the GoI to improve basic health and education services for 2.1 million beneficiaries in 11 provinces, and US$2.4 million for 203 remote primary schools in five pilot districts to form committees to monitor school performance. It also provided US$9.6 million to enable LSP to supply a package of knowledge programs, including just-in-time (JIT) policy advice and technical assistance on Village Law implementation, evaluations including the Long-Term Generasi Impact Evaluation (IE), KIAT Guru Impact Evaluation, ECED Evaluation and enhanced implementation support, including implementation support for the VIP and Generasi transition. In 2017, LSP welcomed Drs. Pungky Sumadi, MCP, Ph.D. (Deputy Minister, Population & Employment, Bappenas) as the Chair of its Steering Committee and programmed US$6 million to support the GoI priorities on stunting, including the National Action Plan, through frontline delivery of a core package of nutrition-specific and nutrition-sensitive interventions, and on LED. 9 CH AP T E R T WO 02 Introduction LSP Facility is a Multi-Donor Trust Fund (MDTF) that aims to assist the Government of Indonesia (GoI) to improve the quality of life of poor and vulnerable Indonesians through delivering local solutions to reduce poverty and inequality. LSP also aims to help the GoI to maximize the impact of the Village Law No. 6/2014 (“the Village Law”) and to secure the legacy of GoI and development partner investments in community empowerment approaches to poverty reduction. LSP builds on its pre- decessor, the PNPM (Program Nasional Pemberdayaan Masyarakat, or National Community Empowerment Program) Support Facility (PSF),4 to enable the World Bank to better meet the GoI’s ongoing demands for knowledge products, well-de- signed and innovative lending operations, and enhanced program implementation support. The Annual Progress Report 2017 provides an overview of the LSP Facility, its oper- ating context and framework; and highlights key program achievements and prog- ress towards the End-of-Facility Outcomes (EOFOs), cross-cutting themes (gender, social inclusion and innovation), and key challenges and lessons learned during the January to December 2017 reporting period. It also identifies LSP’s key future priorities and direction into 2018 and beyond. The report is structured around the Facility’s three major EOFOs: (i) Local governments become more responsive and inclusive; 4 LSP represents the latest incarnation of the World (ii) Beneficiaries receive improved basic service delivery; and Bank’s primary program for addressing these is- (iii) National and local governments better use fiscal resource. sues, and is the culmination of 16 years of expe- rience working with, across, and at different levels It also highlights progress towards cross-cutting issues, such as gender, social in- of government to help innovate and scale up local development and community empowerment pro- clusion and innovation. grams, such as the Kecamatan Development Pro- gram (KDP) and PNPM. Partnering with the GoI, DFAT and MCA-I, LSP is managed by the World Bank. IN TR O DUC T I O N 10 Box 1. Relevant Investment Against a backdrop of far-reaching GoI reforms, one of global expertise in CDD, PFM, LED, stunting, nutrition the challenges for LSP is to maintain its relevance. LSP and impact evaluations to work with the GoI and other constantly evolves to remain in line with the GoI’s needs development partners to effectively deliver this suite of and to meet its development partners’ expectations, as activities. the agenda around village development and basic ser- vice delivery has changed. In 2017, LSP and its mandate To continue to maintain relevance and alignment with were realigned in close consultation with the GoI and the GoI priorities, LSP regularly engages with Bappenas and MDTF donors (particularly DFAT) to maintain relevance other key government counterparts through the LSP and to maximize its contributions to the GoI’s develop- Steering Committee (chaired by Bappenas and includes ment priorities to improve the quality of life for all Indo- DFAT, MCA-I and the World Bank as core members), nesians. Technical Working Groups and other communication channels. In December 2017, the LSP Steering Committee LSP’s current mandate is “Supporting the GoI to improve met to approve LSP’s 2018 work program (including the the quality of life of poor and vulnerable Indonesians INEY Operation and LED pilot program), and a workshop through local solutions to reduce poverty and inequality.” is scheduled in early February 2018 to present LSP’s This mandate directly aligns with the GoI’s National Medi- progress to the Steering Committee and seek feedback um-Term Development Plan 2015-2019 (RPJMN) and the and opportunities for refinement. President’s Nawa Cita, which prioritizes improving village development and basic service delivery, and ultimately reducing poverty and inequality. LSP’s work also directly aligns with the objectives of the GoI’s Village Law agenda, which focuses on providing systematic and continuous Village Law implementation support; strengthening vil- lage government institutions; and increasing the availabil- ity of and access to education and health facilities. LSP and its mandate also directly align with the Government of Australia’s (GoA) DFAT Aid Investment Plan FY16-FY19, particularly Aid Objective 3, “An Inclusive Society through Effective Governance.” LSP supports the DFAT Aid Invest- ment Plan’s objectives through financing programs and initiatives that promote good governance and develop- ment principles that are transparent, accountable, open and more inclusive. Like the GoA, LSP recognizes the importance of inclusive growth to reduce inequality and poverty. LSP’s programs promote more effective, struc- tured and inclusive participation at the village level to en- sure that village development is more open and respon- sive to local needs, including the needs of the women and other vulnerable groups. In line with its mandate, the LSP portfolio includes a wide mix of projects, pilot projects and analytics related to health, education, infrastructure and economic opportuni- ties as evidence shows that unequal access to these ser- vices is a major contributing factor to inequality and pov- erty across Indonesia. LSP leverages the World Bank’s deep operational knowledge of Indonesian systems and social institutions: 17 years of engagement with the GoI and its past CDD programs across multiple sectors; and 11 CH AP TE R T HR E E LSP Context CHAPTER 3.1 LSP’s Operating Context and Progress in the Broader Sector With considerable success to date, the GoI has long had a major focus on reducing poverty. Since 1999, Indonesia has made large gains in reducing poverty, largely through sustained growth and job growth. Despite a slowing of poverty reduction, especially between 2013 and 2016, poverty fell by about 0.58 percent in 2017, or by about 1.2 million people (Figure 1). Out of a population of 252 million, 35 percent re- main poor or vulnerable to falling into poverty.5 Rising inequality, poor service deliv- ery performance and lagging health and education outcomes also continue to per- 03 sist, particularly in rural and remote areas, despite increases in GoI spending in these areas. For example, even though Indonesia has allocated 20 percent of the state budget to education since 2009, student outcomes have failed to improve. Despite the country’s decentralization efforts and increases in local government spending, many of its human development outcomes are on par with lower income countries; for example, it has the second highest incidence of child stunting in Southeast Asia 5 World Bank, 2017, Aspiring Indonesia: Expanding the Middle Class. LS P C O N T EX T 12 with 37.2 percent of children under age five, and an estimated maternal mortality rate of 126 wom- FIGURE 1 en per 100,000 births in 2015.6 Regional dispari- Poverty and Umployment Rate (percent) ties tend to exacerbate these challenges with ru- ral areas often suffering more from limited basic health, education and infrastructure services. 20 Against this backdrop, the GoI is placing height- ened attention to increase the impact of cur- 16 rent spending on reducing rural poverty and inequality. Over the past year, the GoI’s Village Law provided US$ 7.3 billion (Rp 100 trillion) to P ov e r t y r at e villages via Dana Desa and Village Funds Allo- 12 cation (Alokasi Dana Desa) – a huge opportunity to improve rural infrastructure and services, insti- tutionalize effective community empowerment, 8 and address key rural development challenges. u n e m ploy m e n t r at e The GoI continued to make progress to improve village disbursements, strengthen the regulatory 4 framework, review and improve the Dana Desa 2005 2007 2009 2011 2013 allocation formula, and roll out and upgrade sys- tems to track village finances and outputs. In par- allel, policymakers focused increasingly on un- Source: BPS derstanding why this large investment in villages Note: Poverty line based on national poverty line is not yielding greater reductions in rural pov- erty and inequality, and understanding the con- straints that limit the quality of village spending. Concerns surfaced, following KPK investigations, CHAPTER 3.2 regarding governance and corruption problems related to the use of village funds. Multiple cab- inet meetings focused on how to improve the LSP’s Operational Framework: impact of the Village Law, and the GoI issued a Joint Ministerial Decree of four ministries (MoHA, The Theory of Change MoV, MoF and Bappenas) on the matter.7 LSP uses a Theory of Change (ToC)10 operational framework to plan the In parallel, the GoI increasingly focused its at- program’s scope and measure the extent to which it achieves its goals tention on ensuring that village and other ex- of reducing poverty and inequality (see Box 5. Monitoring and Evaluation penditures are converted into effective frontline (M&E), p. 28). This report describes LSP’s progress against the following services that address Indonesia’s high levels of three EOFOs: stunting, provide children a better start in their (i) Local governments become more responsive and inclusive; early years, and improve the quality of educa- (ii) Beneficiaries receive improved basic service delivery; and tion and other rural services. For example, the (iii) National and local governments better use fiscal resource. Vice President launched a National Action Plan to reduce stunting8 and, in 2018, will pilot a Hu- These three EOFOs are underpinned by 10 Intermediate Outcomes (Figure 2). man Development Workers (HDW) project in 31 Several other cross-cutting issues are also addressed by LSP activities, districts with the highest stunting prevalence in with a specific focus on gender and social inclusion. See Annex 1 for the Indonesia.9 LSP Theory of Change framework and Annex 3 for an update of all LSP planned vs. actual activities for 2017. 6 In comparison, the maternal mortality rate is 20 in Thailand, 40 in Malaysia, 54 in Vietnam and 114 in the Philippines (WHO, 2015). 7 Joint Decree regarding the Harmonization and Strengthening of Implementation Policy of Village Law No. 6/2014 about the Village (No.140-8698/tahun 2017 (MoHA), No. 954/KMK.07/2017 (MoF), No. 116 Tahun 2017 (MoV) and No. 01/SKB/M/PPN/12/2017 (Bappenas)). 8 As documented in Perpres No. 42/2013 Gerakan Nasional Percepatan Perbaikan Gizi, Inpres No. 01/2017 Gerakan Masyarakat Sehat (Germas) and Perpres No. 83/2017 Kebijakan Strategi Pangan dan Gizi. 9 In 2017, National Team for the Acceleration of Poverty Reduction (Tim Nasional Percepatan Penanggulangan Kemiskinan, or TNP2K) released the Buku 100 Kabupaten/Kota Prioritas un- tuk Intervensi Anak Kerdil (Stunting) (100 Priority Districts and Municipalities for Stunting Intervention Reduction report). The districts were chosen based on (i) the number of stunted children under five; (ii) stunting prevalence; and (iii) poverty rate. Thirty one of the 100 districts are Generasi Districts. All 31 Generasi stunting priority districts are included in the HDW pilot project. 10 The ToC is a thinking tool that is used to clarify the pathway between the goals of the LSP Facility, the activities it undertakes, and how the outcomes are anticipated to be achieved. 13 CH AP TE R T HR E E FIGURE 2 End-of-Facility outcomes (EOFO) BROADER Enabling citizens, villages, local governments as well as the private sector to identify and implement local solutions to GOALS reduce poverty and inequality in Indonesia Improved pro poor, inclusive, community driven, and impactful local development at village level EOFOS 1. Local governments become more 2. Beneficiaries receive improved 3. Central and local governments responsive and inclusive basic service delivery make better use of fiscal resources INTERMEDIATE • Strengthened local framework and • Beneficiaries experience increased • Strengthened national framework OUTCOMES system to improve governance equity of access to services and systems for tracking village and downward accountability to • Beneficiaries increasingly utilize finances and outputs communities services • Pilot villages demonstrate finance • Communities have more effective • Beneficiaries have improved quality allocation that is equitable, needs and structured participation at of education and health services based and pro-poor village-level • Village communities and govern- • Local governments have develop- ment have improved capacity to ment plans and budget that better manage increased finances reflect community needs, including • Data-driven planning and budget- women and poor people ing at local level is strengthened PROGRAM • Data for Results • Early Childhood Education and • Data for Results ACTIVITIES • Early Childhood Education and De- Development • Early Childhood Education and velopment • Generasi Development • Generasi • Investing in Nutrition and Early • Generasi • KIAT Guru Years • Investing in Nutrition and Early Years • MELAYANI • KIAT Guru • KIAT Guru • Village Law PASA • Village Innovation Program • Local Economic Development • MELAYANI • Village Law PASA LSP main aim is to institutionalize the principles of community empowerment into core government functions; and improve the capacity of GoI agencies, service providers and communities to implement local development solutions by leveraging the World Bank’s core competencies through six approaches (see Figure 3). FIGURE 3 LSP Six Approaches MANAGING MULTI-SECTOR ANALYSIS TECHNICAL ASSISTANCE Producing and disseminating high-quality re- Providing TA to the GoI and development part- search and analytics including from ongoing ners to implement poverty reduction programs projects, and in collaboration with other devel- through local solutions and innovations. opment partner activities. FOSTER POLICY DIALOGUE PILOT PROJECTS Conducting high-level policy dialogue and pro- Financing pilot projects to test innovations and moting evidence-based policy to reduce pov- then scale-up. erty and inequality, and strenghtening relevant government data and M&E systems. FACILITATED KNOWLEDGE EXCHANGE INSTITUTIONALIZE LARGE-SCALE Facilitating the exchange of knowledge and OPERATIONS experience between relevant actors, in Indo- By leveraging government-executed grants nesia and beyond. and World Bank loans. LS P C O N T EX T 14 CHAPTER 3.3 Key LSP Programs and Activities Early Childhood Education and Development (ECED): This pilot project aims to increase the availability of high-quality, affordable and professional training for early childhood teachers in poor rural districts. The pilot project tests a frontline service delivery approach to address constraints that impede the quality of early childhood education services in rural areas, specifically the availability of qualified teachers.11 The district-based, community-focused training system was piloted in 25 districts over a two-year period. The project leverages and enhances existing GoI teacher training programs, strengthens local capacity to deliver ECED training at the sub-dis- trict level, and introduces community participation into the service delivery process. Generasi: Focusing on poor, rural sub-districts across 11 pilot provinces, the Gener- asi project aims to empower local communities in about 5,800 villages to increase the utilization of health and education services. Generasi uses community planning Local Health Post in and incentivized sub-district grants to improve outcomes in terms of 12 priority health and education indicators, utilizing agreed-upon targets that promote com- East Sumba District, munity participation in decision-making to identify and implement local solutions. East Nusa Tenggara. KIAT Guru: This innovative pilot project empowers communities in villages to im- In cooperation with prove education service delivery by tying the payment of the special allowance (Tun- jangan Khusus, or TK)12 payable to teachers working in remote areas to improve- Generasi, the local health ments in teacher service quality. The KIAT Guru pilot project empowers communities post (posyandu) provides to: (i) verify teacher attendance using mobile phone-based applications; and (ii) eval- uate teacher quality performance using community scorecards. The KIAT Guru pilot supplementary meals for project started in July 2016, with a baseline survey conducted across 270 primary the children. Following schools in five disadvantaged districts. Of these 270 schools, 203 were selected for subsequent KIAT Guru assistance, potentially benefitting over 26,000 students. the implementation of Village Law, the village Monitoring and Evaluation (M&E), and Special Studies: As part of its analytical support to the GoI, LSP emphasizes the importance of using evidence-based ana- government had agreed lytics to inform policy design and program implementation. LSP produces high-qual- ity analytics and data for its key community empowerment poverty reduction proj- to integrate Generasi ects, such as Generasi and Village Law implementation, to generate evidence that Program into Village informs program operations, performance and advice to policymakers on how to achieve better results. LSP supported the Generasi Long-Term Impact Evaluation Law by further support (L/T IE), KIAT Guru IE and ECED evaluations. LSP also conducts in-depth research on the Posyandu activities local and development priorities in Indonesia, such as the Sentinel Villages Study, the Civil Service Data Analysis project and just-in-time (JIT) analytics. through village funds. Village Innovation Program (VIP): The VIP, for which the LSP provides enhanced implementation support, aims to improve the capacity of villages to plan (and ulti- mately use) their fiscal transfers for village investments that focus on village entre- 11 A professional development package costing Rp 1.5 million (US$111) per teacher is provided from Generasi funds to 25 pilot districts to test the viability of scaling up the system to villages across Indonesia. 12 TK is a non-permanent allowance of up to one times basic salary for the hardship teachers encounter in working in poor and remote areas. 15 CH AP TE R T HR E E preneurship, human capital formation and village infrastructure. The program seeks to enable and incentivize villages to allocate more fiscal transfers to entrepreneur- ship and improve the technical quality of entrepreneurial activities. The VIP pro- vides financing for three platforms: (i) a district-level innovation platform to better institutionalize knowledge-sharing; (ii) a capacity-building platform for local technical service providers (TSPs) to improve their ability to deliver technical services to vil- lages; and (iii) a data platform to document datasets on village development needs, priorities and outputs. Village Law Programmatic Advisory Services and Analytics (Village Law PASA): The Village Law PASA supports GoI efforts to ensure accountable village governance and participatory village development, particularly related to: (i) re- source mobilization, allocations and flows; (ii) village development governance, accountability and capacity; (iii) community empowerment and inclusion; and (iv) M&E thematic studies. The project delivers JIT policy advice and analytics, techni- Children of remote cal support for operationalizing policies and systems, and robust analytics. villages in East Nusa MELAYANI: “Untangling Problems to Improve Basic Services in Indonesia” (Men- Tenggara walk through guraikan Permasalahan Perbaikan Layanan Dasar di Indonesia, or MELAYANI) is a 12-month pilot project that uses a problem-driven approach13 to tackle service challenging terrain on delivery issues. Under MELAYANI, World-Bank-supported coaches help pilot dis- to get to schools. trict governments navigate through a process of breaking down local problems (based on data and multi-stakeholder analysis), and identifying and implementing Sometimes they need to solutions that are regularly reviewed and adjusted. Through this, MELAYANI aims walk for 30 minutes to to develop a problem-driven model that can be scaled-up and replicated to im- prove local public service delivery. The pilot project commenced in October 2017 1 hour to get to school. and is being rolled out across three districts. LSP also supports the LED Pilot14 and Data for Results15 projects. However, as both projects will not commence until 2018, they are not reported in the LSP An- nual Report 2017. 13 The approach draws on several methodologies, such as Problem-Driven Iterative Adaptation (PDIA), Deliverology and an earlier World Bank pilot instrument called the Rapid Assessment and Action Plan (the predecessor of MELAYANI). 14 The LED pilot supports the GoI in introducing new models of LED, which focus on linking village farmers and entrepreneurs to markets, into the RPJMN 2020-2024. The proj- ect includes three components: national policy framework, enterprise networking and partnerships; and market-driven operational models. 15 The Data for Results project aims to manage local data more effectively to deliver services locally. The project will help streamline local data systems to build more effective Data for Results systems. C HA P T E R F O UR 16 Progress Towards EOFO One: Local Governments Become More Responsive and Inclusive Local governments (LGs) are responsible for most health and education services in Indonesia and spend almost half of the entire state budget on these services. How- ever, the quality of this spending remains low and does not always reflect the needs of the community. In addition, LGs now play a key role in guiding and safeguard- ing the implementation of the Village Law. To ensure that fiscal spending reflects community needs, including those of women, the poor, and marginalized groups, in 2017 LSP helped strengthen national regulations and systems in order to embed more structured participation in the implementation of Village Law; strengthened national and local government capacity to implement participatory processes using data-driven evidence to inform decisions; and improved accountability mechanisms at national, district and village levels. Together these efforts helped strengthen na- tional and sub-national frameworks and processes to support more inclusive devel- opment at the village level. CHAPTER 4.1 Outcome 1: Strengthening local frameworks and systems to improve governance and downward accountability to communities Under Village Law, villages have access to increased fiscal resources, and more management and implementation responsibilities. Yet village systems and mechanisms for tracking village management, oversight, implementation and performance are weak, which inhibits transparent and accountable village development. During 2017, LSP focused on strengthening national government systems and regulations to improve village governance and downward accountability by providing technical, analytical and capacity-building support. Going forward, LSP will focus on supporting coordination and further building capacity to support the implementation and uptake of these regulations and systems. 04 Understanding key governance constraints limiting the quality of village spending In 2017, the Village Law PASA, supported various foundational analytical work, including the Sentinel Village Study, the World Bank-GoI Spot Check of Village Governance and Financial Management, and the Village Public Expenditure Review (ViPER) Analysis. This work aimed to identify and improve the GoI’s understanding about key governance constraints limiting the quality and impact of village spending. 17 P R OGR ES S TOWAR D S EOFO ONE Using an evidence-based analytical 2017 in 64 villages across 27 sub-districts in 12 districts and six provinces. Both approach, the Sentinel Villages exercises highlighted the need to strengthen complaints handling around village Study analyzed how LG frameworks funds. The Spot Check findings indicated that: (i) the most significant governance and systems enable or hinder risks around village funds are at the district level; (ii) many of the villages publish community participation and bottom-up information on their budgets and finances; (iii) the limited capacity of village staff in accountability in village development. managing village finances is a significant risk; and (iv) improvements are needed in The analysis found that not all village village financial management (VFM) systems, as well as in supra-village monitoring meetings are inclusive, and village and supervision. heads do not always proactively disseminate information to all villagers Building on the Sentinel Villages Study, Spot Checks, and the ViPER Analysis, Village through structured and open channels. Law PASA also reviewed provincial and district spending for villages, and began The ViPER Analysis, which analyzed an assessment of district capacities (institutional, financial and human) in providing 1,868 villages in 2017, found that adequate support and supervision to villages. The district assessment will help villages spent almost 40 percent of their systematically unpack many of the challenges districts face, including lack of clear funds on administration,16 that village guidance, capacity, incentives and funds to perform their roles effectively. Village spending on health and education is Law PASA will draw on these findings to help GoI shape more effective, demand quite small (five percent of the village driven and sustainable support to villages. budget), and that inconsistencies in how villages classify their finances hinder Box 2. accurate reporting on village spending (see Chapter 6.1 for further details on Efficiency the ViPER Analysis). Drawing on these In 2017, the LSP MDTF disbursed US$29 million. As of the end of 2017, the studies, the Bank prepared an analysis of MDTF cumulatively disbursed a total of US$315 million (see Annex 2 for further Village Law implementation bottlenecks MDTF expenditures). From the 91 main LSP activities in the 2017 LSP work and recommended actions for senior plan/activity log, 44 percent of activities were completed, 37 percent are on- GoI officials (MoHA, Bappenas, MoF, going (expected completion in 2018), four percent are delayed and 15 percent MoV and Kantor Staf Presiden or KSP). are under preparation. The results of the analysis contributed To achieve better value for money (VfM) and more sustainable impacts, LSP to the formulation of the December leverages the GoI and other development partners’ resources. For example, 2017 joint ministerial decree on Village in 2017, LSP: Law implementation among MoHA, Bappenas, MoF, and MoV.17 • Complemented and leveraged existing GoI initiatives and resources to pro- mote more sustainable impacts: LSP’s KIAT Guru pilot project leveraged To further understand current the GoI’s Tunjangan Khusus mechanism, which has a total annual budget management and oversight practices of US$118.5 million (Rp 1.6 trillion). In 2017, MoEC contributed US$392,600 and constraints at the village level, (Rp 5.3 billion), the five districts contributed US$111,000 (Rp 1.5 billion) and the Village Law PASA also finalized the village governments contributed US$62,700 (Rp 846 million) through the an assessment of village complaints village funds. MoEC has also committed an additional US$392,600 (Rp 5.3 handling systems (including a regulatory billion) for 2018. analysis) and supported a joint World • Worked with other development programs to enhance outcomes and max- Bank-GoI (MoHA and MoV) Spot Check imize the GoI commitments: LSP’s Village Law PASA worked with KOMPAK of Village Governance and Financial to support the Directorate General of Fiscal Balance (DJPK) to revise the Management with a focus on downward 2018 Dana Desa Formula Allocation to make it more pro-poor (PMK No. 199/ accountability. The complaints handling PMK.07/2017), which represents a positive step towards making the Dana assessment was carried out in four Desa more equitable. LSP and KOMPAK also worked together to support provinces18 over 2016 and 2017. The Spot the Village Government Oversight, Ministry of Home Affairs (Bina Pemer- Checks were conducted in September 16 This is above the 30 percent ceiling. 17 Joint Decree regarding the Harmonization and Strengthening of Implementation Policy of Village Law No. 6/2014 about the Village (No.140-8698/tahun 2017 (MoHA), No. 954/KMK.07/2017 (MoF), No. 116 Tahun 2017 (MoV) and No. 01/SKB/M/PPN/12/2017 (Bappenas)). 18 Complaints-handling fieldwork was carried out in two phases across four provinces—Central Java, East Java, West Sulawesi and East Nusa Tenggara. Phase 1 comprised a limited assessment of district and sub-district capacity to manage and resolve complaints relating to village governance. Study locations were Cen- tral Java (Wonogiri and Banyumas districts) and West Sulawesi (Polewali Mandar and Majene districts). Key respondents included representatives of Community Empowerment Agencies (Badan Pemberdayaan Masyarakat Desa or BPMD); Village Governance Units of Regional Secretariats (Bagian Pemerintahan Desa, or Pemdes); inspectorates; district prosecutors; sub-district governments and village facilitators. C HA P T ER F O UR 18 Dana Desa allocations could be made Box 2 (CONTINUED) more pro-poor (see Chapter 6.2 for intahan Desa, Kementerian Dalam Negeri, or Bina Pemdes) to revise Per- further details on the 2018 Dana Desa mendagri No. 113/2014, which now incorporates strengthened village finan- Allocation Formula). These findings cial management and participatory elements (see Chapter 6.1). contributed to the Bank’s overall • Leveraged other World Bank operations and global networks to inform de- analysis outlining the key factors that cisions and maximize impacts: In 2017, LSP and the results from its programs limit the quality of village spending, and studies were used to inform multiple other World Bank operations. For and, in turn, village outputs, and the example, results from Generasi and the ECED pilot project will inform the poverty reduction and development new INEY Operation (see Chapter 5.2); and results from LSP’s BKN Civil impact of the Village Law. For example, Service Analysis will inform the World Bank Governance Team’s Human Re- this analysis contributed to the World source Development for Bureaucratic Reform (see Chapter 7). Bank Public Expenditure Review, • Used local government funds to support LSP supported initiatives: In 2017, which included recommendations on a number of local governments allocated village fiscal resources (APBDes) Village Law implementation and was to support or expand LSP-supported activities. For example, the Gorontalo presented to the Minister of Finance District (ECED pilot district) committed village funds to expand the ECED in June 2017; presentations about training system program in 2017 (see Chapter 4.3). In Generasi integration improving the impact of the Village Law strategy locations, overall village spending (APBDes utilization) for health (acceleration presentation) which were and education activities increased from 10.9 percent (2015) to 15.8 percent provided to the Minister of Finance; (2017) (see Chapter 4.3). and multiple presentations provided to MoV, MoHA, the National Team for the Acceleration of Poverty Reduction (Tim Providing evidence-based assistance and advice to strengthen Nasional Percepatan Penanggulangan governance frameworks, systems and processes Kemiskinan, or TNP2K), MoF, KSP, and MoV on what the GoI can do to The Village Law PASA used the findings from these studies, which highlighted improve the development impact of the Village Law bottlenecks as well as the fragmented and limited quality of village Village Law. In turn these presentations spending, to inform its ongoing policy dialogue and advice to the GoI to strengthen contributed to the December 2017 key regulations and systems that improve village governance and downward Surat Keputusan Bersama (SKB), which accountability. For example, evidence generated through ViPER and Sentinel includes multiple provisions that reflect Villages was used to inform LSP’s technical analysis and advice to the GoI (e.g. the analysis and recommendations through Village Law PASA-supported consultants) about revising the regulation provided by LSP as well as other covering VFM (Permendagri No. 113/2014) and improving the system (Sistem stakeholders. Keuangan Desa, or Siskeudes), which is being rolled out to help villages better track and report their finances. ViPER’s findings on major inconsistencies in how villages In 2017, LSP continued to support classify their findings directly informed LSP’s detailed analysis, recommendations, the KIAT Guru pilot program, and its and dialogue with the GoI about improving village financial classifications in the performance incentive mechanisms, revised Permendagri No. 113/2014 (see Chapter 6.1 for further details on revised at the sub-national level to improve Permendagri No. 113/2014). Further, ViPER analysis, which showed that only a small education service delivery by percentage of village budgets were spent on village-level health and education empowering communities and tying services, have featured in policy dialogues and LSP-provided advice on the annual teacher allowance to performance. national regulation on village priority setting19. The ViPER findings also complement In 2017, key national-, district- and the Generasi integration strategy work to support villages to increase their funding village-level regulations were issued for frontline services. that adopted KIAT Guru as a priority program and made it possible for The Sentinel Villages case study on village fund utilization found that villages tend to teacher allowances in remote areas to fragment their development budgets into many small projects rather than financing be performance based. MoEC issued larger projects, which is a potentially critical bottleneck limiting the development two key regulations, including: impact of the Village Law. This analysis informed Village Law PASA’s support to • MoEC Decree No. 99/P/2017 on MoV/MoHA to improve the rules, regulations, training, and M&E that strengthen the Priority Program in Delivery village planning and budgeting (e.g. technical analysis and recommendations of teachers’ special allowance to inform the revision of Permendagri No. 114/2014). The findings will also inform LSP’s planned support to the GoI to improve training on village planning. Analytical 19 Includes the Peraturan Menteri Desa (Minister work on the allocation formula, using village-level data, provided evidence on the of Village Regulation) or Permendesa no. 22/2016 limitations of previous Dana Desa allocations, as well as detailed options for how (for 2017) and Permendesa no. 19/2017 (for 2018) 19 P R OGR ES S TOWAR D S EOFO ONE (Tunjangan Khusus, or TK), which identified KIAT Guru as a participate in monitoring and holding governments more MoEC priority program; and accountable for the services they provide. Specifically, during • MoEC Decree No. 11788/B/HK/2017, which provided 2017, Generasi continued to support the implementation technical guidelines for its implementation. of cross-village audit pilot projects, village accountability meetings and the performance incentive systems (in the Subsequent sub-national regulations were issued (in total 435 three remaining block grant recipient locations). Generasi regulations), which allowed the first TK payments to be made also helped set up a complaints-handling system, which in April 2017 (see Chapter 5 for further details). This regulatory was designed to capture complaints related to the quality framework is expected to directly improve teacher presence of service delivery (as opposed to financial management, and teacher performance, which will benefit over 26,000 procurement and administrative issues). Specifically, LSP students in the pilot schools. During the implementation supported consultants to train facilitators to set up the process, KIAT Guru helped foster dialogue between various complaints-handling system and rollout the new system in stakeholders (MoEC and LG policymakers, teachers, members Generasi villages. As of September 2017, 205 cases had been of school-user committees and village cadres) to identify raised in the new system and 183 were resolved. Generasi, education service delivery challenges and solutions at the along with the Finance and Development Supervisory Agency local level. (Badan Pengawasan Keuangan dan Pembangunan, or BPKP), At the sub-national level, LSP, through Generasi, supported is currently verifying this data, which will be reflected in the a range of mechanisms to improve communities’ ability to BPKP audit document. CHAPTER 4.2 Outcome 2: Communities have more effective and structured participation at the village level The more participative the interaction between LGs and com- ticipation in village planning is varied and not guaranteed. To munities at the village level, the more inclusive and respon- address these challenges, in 2017 LSP, by providing analytical sive LGs are likely to be, enabling citizens to better participate and technical support, informed and strengthened GoI deci- in identifying and implementing local solutions to poverty and sions and regulations so that they better incorporated partici- inequality. Building on past community-driven development patory principles and processes. At the sub-national level, LSP (CDD) approaches, the Village Law incorporates principles of piloted and supported various initiatives to empower commu- community participation. However, in practice, community par- nities to participate in village processes. FIGURE 4 Sentinel Villages Longitudinal Study Methodology (2015-2018) M e t h o d o lo gy a n d Lo c at i o n 5 JAMBI : Merangin, Batanghari DISTRICTS CENTRAL JAVA : Banyumas, Wonogiri EAST NUSA TENGGARA : Ngada Q ua n t i tat i v e 112 2,240 112 112 HOUSEHOLDS V I L L AG E S V I L L AG E BPD 2 ,1 2 5 WO M E N 1 , 9 5 6 M E N HEADS HEADS 112 222 224 192 HAMLET COMMUNITY H E A LT H S E C TO R E D U C AT I O N S E C TO R HEADS AC T I V I S T S WO R K E R S WO R K E R S Q UA L ITATIVE S 10 5 Observers V I L L AG E S S TAY I N T H E V I L L AG E S F O R R E G U L A R M O N I TO R I N G C HA P T E R F O UR 20 Understanding Village Law participation, inclusion practices and FIGURE 5 constraints at the village level Characteristics of In 2017, the Village Law PASA implemented foundational studies, including the Senti- village- and hamlet- nel Villages Longitudinal Study, to understand participation and inclusion constraints meeting attendees and under Village Law. The study examined villages’ experiences with Village Law im- plementation and village governance processes. Commencing in 2015, the Sentinel non-attendees Villages Study focuses on five districts across three provinces to analyze commu- TEN D E D NOT TO PARTICI PATE nity participation in village development processes, as well as examine district and sub-district support for these processes (see Figure 4). In 2017, two additional case studies, on facilitation and village utilization, were completed. Analysis from the Sen- FEMALE tinel Villages case studies found that (i) villagers’ awareness of village programs and the use of village funds is low; (ii) village planning meetings are not open to all villagers (see Figure 5); (iii) villagers have greater interest in participating at hamlet meetings HOUSEHOLD (musyawarah dusun or MusDus) compared to village meetings (musyawarah desa, or H E A D E D BY F E M A L E MusDes), and even when they do attend the meetings their engagement is somewhat limited; (iv) village activists (about 80 percent) were often invited to, attended and D istance to village engaged at the MusDus and the MusDes with female village activists being almost as head office ( km ) engaged as their male counterparts;20 and (v) district policies influence village gov- ernance.21 The analysis also found that women tend to not attend village meetings NO FORMAL if their hamlet is far from the village office and if they have children under five. While E D U C AT I O N men are less likely to attend village meetings if they come from a female-headed household or if they are less wealthy. The findings were widely disseminated through presentations and other events attended by MoV, MoHA, BPKP, MoF, development B OT TO M - 4 0 partners and other stakeholders to help foster policy dialogue. Strengthening national regulations to be more inclusive and TEN D E D TO PARTICI PATE participatory. During 2017, LSP used the study’s findings, which document limited inclusion in vil- lage governance processes, to provide evidence-based technical advice to the GoI C O M P L E T E D S E C O N DA RY A N D B E YO N D to help ensure that various Village Law-related regulations are more inclusive and participatory. The Village Law PASA supported MoHA to develop the Permendagri on Village Community Institutions (Lembaga Kemasyarakatan Desa, or LKD) and Vil- C U R R E N T LY lage Customary Institutions (Lembaga Adat Desa, or LAD). Through facilitating various WO R K I N G policy discussions, public consultations, and analysis, LSP provided evidence-based technical and policy advice to help ensure that the Permendagri draft incorporated SUBMITTED COMPLAINTS strengthened participatory principles and elements (see Box 3). The Permendagri is OR REPORT PROBLEMS currently undergoing internal MoHA review and is expected to be issued in 2018. The direct extent of LSP’s influence on the Permendagri will be better understood once it has been finalized and issued. LSP also provided technical assistance to support AC T I V E I N LO C A L O R G A N I Z AT I O N MoV’s ongoing revision of the regulation on Village Development and Rural Devel- opment (Permendagri No. 114/2014), which set the rules and framework for village planning and implementation processes, including for inclusion and participation. The AC T I V E I N team fostered policy dialogue by conducting a workshop with legal experts to provide P O L I T I C A L PA R T Y feedback and recommendations on the latest version of the draft. It is anticipated that the revised Permendagri No. 114/2014 will be finalized in 2018. V illage head is reliable in Supporting and piloting intiatives to empower communities in implementation village planning processes 20 There is potentially an opportunity to involve Generasi promotes community participation in decision-making by mobilizing fa- activists as village representatives, to help cilitators with health and education training to work with communities to help di- enhance the role of village councils (Badan Per- musyawaratan Desa, or BPD). rect them to activities that address local needs. Specifically, Generasi-supported 21 SMERU Research Institute. 2016. SMERU Policy facilitators work to ensure the principles of community empowerment (participation, Brief. Reforming BPD to Strengthen Villages. 21 P R OGR ES S TOWAR D S EOFO ONE transparency and accountable) are adopted in sub-district and village meetings. The facilitators also ensure adequate representation of different stakeholder groups in village meetings, including vulnerable groups like women and the poor. In 2017, Generasi expanded its support in three provinces (West Kalimantan, Central Kali- DURING THE REPORTING mantan and South Sumatera). In these provinces, Generasi continued to implement PERIOD, GENERASI block grants through a facilitated community decision-making process whereby SUPPORTED TRAINING communities worked with health and education service providers to identify local- FOR ALL ly appropriate ways to improve access and use of health and education services. According to LSP’s 2017 monitoring data, from the three provinces receiving block grants, about 74 percent of the block grants were used for health activities, includ- ing health infrastructure, facilities, equipment, and medicines. While 26 percent of 38,314 the block grants were used for education activities, such as education infrastruc- ture, facilities, and equipment, and financial assistance for poor students. Overall, LSP 2017 monitoring data (from Generasi’s 11 provinces) showed that approximately 65 percent of women were involved in planning and decision-making meetings. 51% FEMALE Generasi also continued to support the provision and training of district and sub-dis- 49% MALE trict facilitators. In 2017, Generasi supported national and provincial consultants to produce training packages for Generasi village actors (including facilitators). During GENERASI VILLAGE the reporting period, Generasi also supported training for all 38,314 (51 percent fe- ACTORS male and 49 percent male) Generasi village actors (local facilitators, village officers, and health and education cadres) in 11 provinces. ( LO C A L FAC I L I ATO R S , VILLAGE OFFICERS, In line with the Village Law’s mandate, LSP continued to support village govern- H E A LT H & E D U C AT I O N ments to better integrate health and education service delivery into regular Village CADRES) Law implementation by continuing the Generasi Integration Strategy. The integra- tion strategy, which commenced in 2016 as a one-year pilot in six districts across West Nusa Tenggara (Nusa Tenggara Barat, or NTB), reorients Generasi’s facilitation IN 11 PROVINCES support towards assisting village governments and communities to ensure village governments address health and education issues in regular village planning and budgeting processes. In 2017, Generasi expanded the integration strategy from the initial six pilot districts to 44 districts. For further details on the integration strategy and its initial results, see Chapter 4.3 Outcome 3: Local government have develop- ment plans and budgets that better reflect community needs. Box 3. Influencing Policy Change - Permendagri LKD and LAD Drafted The Village Law recognizes inclusive village development, which accommodates representation and participation of different groups in the villages, including the village community and customary village institutions. In 2017, LSP’s Village Law PASA supported the Directorate General (DG) of Village Government Oversight in MoHA to draft the Permendagri on Village Community Institutions (LKD) and Village Customary Institutions (LAD). Specifically, LSP provided technical assistance to support various discussions, public consultations, and policy and legal analyses to inform the draft policy brief and Permendagri. Through this work, the World Bank brought together key stakehold- ers (academics, practitioners and government officials) to discuss the prerequisites and procedures for LKD and LAD; helped gather insights and data about community and customary institutions and the inclusiveness of vulnerable groups (Indigenous Peoples, women, people with special needs and other community groups); and provided evidence-based legislative TA. This Permendagri provides formal recognition of community and customary institutions as LKD and LAD; promotes more inclusive village development by recognizing more diverse village governance arrangements; and incorporates strengthened participatory, gender equality, accountability, and transparency principles and elements. The regulation also helps ensure that the villages better reflect the needs of communities. C HA P T E R F O UR 22 Box 4. Sustainable Nutrition Gardens Boost Nourishment, Income for Villagers in East Nusa Tenggara The sweltering heat subsided as The situation was very different a couple of years ago. During the dry season, the sun moved closer to the west which can last up to eight months. It’s very dry in Sumba Timur and it is difficult one afternoon in early August. For a for people to grow vegetables, which created various nutritional issues among farmers group in Haikatapu Village, the community. The farms were also not well organized, and inadequate public Rindi Sub-district in Sumba Timur, transportation made it difficult for people to obtain seeds. So most people re- East Nusa Tenggara (one of the lied on grocery sellers that infrequently passed through the area to purchase Generasi integration location), that vegetables. only meant two things: watering and During a village meeting, which the Generasi team attended, these issues were weeding the nutrition gardens. The discussed. Responding to the problem, the village community empowerment two nutrition gardens occupy about cadre assisted the community to identify, budget for and buy seeds to set up 3,200 square meters of village nutrition gardens. Following Generasi-conducted cadres training, the cadres land, which are surrounded by rice also worked with the community to establish nutrition gardens in each village. fields and close to a spring. A group of eight farmers have managed the Today, the gardens help ensure families meet their daily nutritional needs and gardens since 2012, when Generasi some of the produce is also given to seven posyandu in the area as supple- handed out five sachets of vegeta- mentary food for toddlers. The gardens also help serve as a source of income ble seeds per person and 100 kilo- as the communities sell the produce in the market. grams of onion seeds, as part of the initiative to improve the villagers’ “The money helps pay for our children’s schooling and household expenses,” nutritional intake. The farmers tend Ninda said, smiling. the gardens every morning and Generasi, in coordination with the Health Agency, facilitated nutrition gardens afternoon, and they work on their in three other villages in the area. A group of farmers that manages the garden own farms in between. in Lukuhippa Hamlet near Haikatappu testified that the nutrition gardens have “We produce plenty of vegetables improved their nutritional intake. now, from cabbage and spinach to The success of the nutrition gardens has prompted village governments within lettuce, eggplant and sweet pota- Generasi areas to discuss the initiative during village development planning to, as well as papaya,” said Ninda deliberative meetings with the aim to allocate village budget funds to support Halawulang, member of the farmers the initiative’s sustainability. group. 23 P R OGR ES S TOWAR D S EOFO ONE Parents in KIAT Guru pilot locations initially lacked self-confidence in evaluating teachers. However, the pilot encouraged them to participate, and helped bring teachers and communities together with the mutual goal of providing better quality education for their children – “We as parents did not pay much attention to what happened in school, thinking there are teachers to do that. With KIAT Guru, we are reminded that our children’s abilities mostly did not meet the standards. The teachers perform better now, and the communication between teachers and parents now exist,” said Maria Fransiska Di of Nggilat Village. In 2017, the LSP ECED pilot project level, communities were also responsible for managing training funds and orga- successfully established a novel dis- nizing training for community teachers, which was usually contracted out to a local trict-based training system that empow- NGO. During the pilot period (2016 and 2017), 100 percent of the 2,674 pilot villages ered local actors – district governments, nominated teachers through the participatory process. By the end of the project in civil society, and communities – to deliv- December 2017, 15,491 ECED teachers, of which 98 to 99 percent were women, had er professional development to teachers benefitted from the training, ensuring a strong community role in ECED in the pilot to improve the availability of well-pre- villages, and empowering women from poor rural villages to join the project (see pared ECED teachers in remote rural Chapter 5 for further details). Indonesia. The pilot project supported communities to actively participate in In 2017, like ECED, the KIAT Guru pilot built the capacity of communities to more ac- selecting, implementing and monitoring tively participate in monitoring the performance of teachers to help hold them more professional training for ECED teachers accountable. Specifically, LSP provided training and on-the-job capacity building for across 25 pilot districts. The pilot proj- 2,030 village cadres and members of school-user committees from the 203 targeted ect used a structured village consulta- primary schools on how to hold teachers accountable based on teacher performance tive process (either through MusDes or (see Chapter 5.3 for further details). a special MusDes/MD Khusus)22 to help communities actively select three ECED 22 This process was usually undertaken through an existing platform, such as MusDes. However, in villag- teachers from their community to partic- es where MusDes had recently taken place, the selection process was done through a special MusDes ipate in the training. At the kecamatan (MusDes Khusus). C HA P T E R F O UR 24 CHAPTER 4.3 Local governments have development plans and budgets that better reflect community needs, including women and the poor Strengthening the sub-national government’s capacity to better plan and budget based on community needs is critical to ensuring that village governments are more responsive and resources are used more appropriately. During 2017, LSP conduct- ed analytical studies to better understand village planning and budgeting practices and constraints under the Village Law. LSP also provided technical assistance and support at the sub-national level to improve government capacity in planning and budgeting so that it better reflected community needs. Understanding village planning and budgeting practices, and constraints During 2017, the Village Law PASA supported the Sentinel Villages study to bet- ter understand the extent to which village planning and budgeting processes in- clude women, the poor and marginalized groups, as well as the extent to which village plans identify investments and services likely to have a development impact. The analysis found that women, the poor (the bottom 40 percent), female-headed households and individuals with no formal education are less likely to attend and participate in village- and hamlet-meetings. This work was complemented by the ViPER Analysis, which analyzed over 1,868 village budgets, to better understand how villages utilize and spend their increased village finances (see Chapter 6.1 for further details on the ViPER Analysis results). Spending on non-infrastructure pover- ty reduction/economic opportunities were quite low. Further, the analysis found that Before going to village development funds tend to be split up among the hamlets, which often led to small projects with limited potential for development impacts. school, children in Nggilat Village, Strengthening local government capacities to plan and budget for health and education service delivery West Manggarai District, Generasi continued to support village governments better integrate health and ed- East Nusa Tenggara ucation service delivery into regular Village Law implementation through the Gen- helps their parents to erasi Integration Strategy. In 2017, LSP continued to support the integration strategy, which is implemented in three phases over 2016 to 2018,23 by providing reoriented get water in the facilitation support to local governments and communities, and operational funds morning to be used for for capacity building (e.g. facilitation and training for village heads, apparatus and village cadres, etc.). Analysis from the Generasi Integration Strategy’s pilot project in the daily domestic six districts in NTB (2016-2017) indicated positive results in terms of village govern- activities. ments’ increasingly allocating APBDes funding for health and education services. In 2017, all six pilot districts in NTB issued draft district regulations that enable health and education services to be funded under the APBDes. Some districts also en- forced minimum health and education spending requirements to boost funding for basic services. For example, Nganjuk District Government in East Java successfully enforced a minimum APBDes allocation of 30 percent for health and education ac- 23 The three phases include: (1) pilot phase in six districts in NTB (2016-2017); (2) pilot expansion in 44 Gen- erasi districts (2017-2018); and (3) final expansion in all 66 Generasi districts (2018). 25 P R OGR ES S TOWAR D S EOFO ONE tivities. Analysis from LSP’s monitoring si-supported facilitators conducted advocacy activities to ensure the inclusion of data indicates that on average APB- health and education under District Action Planning and Budgeting (Rencana Aksi Des allocations for health and educa- Daerah, or RAD). While it is still too early to determine Generasi’s influence on the tion spending in 411 villages in the six 44 districts’ health and education APBDes spending, initial results indicate that Gen- NTB pilot districts increased from 10.9 erasi’s facilitation support has helped strengthen District Head Regulations (Pera- percent (2016) to 15.8 percent (2017).24 turan Bupati, or Perbup) related to the use of Dana Desa for health and education This included spending on posyandu/ activities. For example, in 2017 among the 44 districts, it was reported that some poskedes buildings, toilets, supplemen- district governments strengthened Perbup to enable APBDes to fund incentives tary feeding, and cadres incentives and for posyandu and PAUD cadres and supplementary feeding activities, including in training. While allocations were main- Gorontalo District (see example below). In 2018, LSP will continue to expand the in- ly for infrastructure, non-infrastructure tegration strategy to include all 66 Generasi districts (including the three provinces budget allocations also rose from 2.8 which received block grants in 2017). Further results will be reported during the next percent (2016) to 4.8 percent (2017). reporting period. During field missions, it was also report- ed that in some of the six pilot districts, In the ECED project, which ended in December 2017,25 there are encouraging signs non-infrastructure health and education that many district governments from the 25 pilot districts are keen to use Dana APBDes budgets were larger than the Desa to continue operating the ECED training system set up by the project. In one Generasi block grant received the pre- case, the district government in Gorontalo District has led the way by issuing its own vious year. district head (Bupati) regulation to enable Dana Desa to be used to support the In 2017, LSP expanded its integration 24 This was calculated by comparing each pilot district’s APBDes 2016 data (baseline data) with their APB- support from six districts in NTB to 44 Des 2017 data. The data is captured by Generasi-supported facilitators and collated in the Generasi’s man- districts across eight provinces (phase agement information system (MIS). The data is validated by the province and shared with national-level two). Across the 44 districts, Genera- government. 25 LSP is currently discussing various possible extension opportunities. C HA P T E R F O UR 26 continuation of the project into 2018, and allocating Rp 155 million (US$11,650) to advanced ECED teacher training in its 2018 budget. There are also indications (e.g. W H I L E A L LO C AT I O N S district governments issued a new Perbup that states that Dana Desa can be used W E R E M A I N LY to support ECED activities) that as many as one-third of the other 24 pilot districts INFRASTRUCTURE, NON-INFRASTRUCTURE are keen to follow Gorontalo’s example. B U D G E T A L LO C AT I O N S ALSO ROSE FROM Through the MELAYANI project, which commenced in October 2017, LSP is work- 2.8% ing with three pilot district governments using a problem-driven approach to help local governments analyze existing data, plan, budget, and deliver solutions that address local needs and service delivery challenges. During the reporting period, MELAYANI selected three pilot districts, including Kubu Raya (West Kalimantan), Bojonegoro (East Java), and Belu (East Nusa Tenggara), based on political com- (2016) mitments and buy-ins. Each pilot district selected an issue that they would like to TO address. In Kubu Raya, the government is working to reduce incidences of stunt- 4.8% ing; in Bojonegoro to reduce infant mortality; and in Belu to improve quality of basic education. The World Bank-supported MELAYANI coaches also supported district governments to commence baseline data collection, which will be used by the pilot districts to analyze and support change processes in 2018. The proj- (2017) ect will be assessed in October 2018. In Pamburu, East Nusa Tenggara, the village head supported three female village members to join local food processing training after it was raised as an issue in a village meeting, which was attended by Generasi beneficiaries. The training was held by the Waingapu District’s Family Welfare Movement (PKK) and financed by the district government’s budget (APBD). After the training, the three women passed their knowledge on to another 30 PKK members in their village through a Generasi-facilitated training. Together, they cooked supplementary food out of ingredients from their local farm and gave it to the posyandu to distribute to children in Pamburu. The food is also sold in the market or school – “The food cooked from PKK farm’s produce is sold and the money is for our petty cash or capital for our weaving business,” said Bangu Kahi, a PKK member. 27 P R OGR ES S TOWAR D S EO FO T WO Progress Towards EOFO Two: Beneficiaries Receive Improved Basic Service Delivery The GoI is increasingly focusing on improving not only the availability, but also the quality of village service delivery after increased government spending on basic services has struggled to improve Indonesia’s performance in terms of important human development indicators. For example, about 37 percent or Indonesia’s nine million children are stunted. Further education outcomes are often hindered by high teacher absenteeism. These issues tend to be exacerbated in rural areas where basic health, education and infrastructure are lacking both in terms of quality and quantity. LSP works with multiple GoI ministries and a broad range of stakeholders to help ensure beneficiaries receive more equitable and quality services. Building on past PNPM experiences and the GoI’s frontline service approach, LSP recognizes the importance of building both the supply and demand sides to improve access to and quality of basic service delivery. In 2017, LSP worked with the GoI and other local ac- tors to help improve the availability of services, better connect villages with service providers, link service providers’ incentives with the quality of services provided, 05 and involve communities in holding service providers more accountable. Further, continued efforts by the LSP and other World Bank teams have influenced the GoI in making nutrition and early years development, particularly stunting, a key national agenda and priority. Together, these efforts have demonstrated positive results in terms of improving access to services (such as the number of professionally-trained ECED teachers in remote areas), communities’ utilization of health services, and the quality of education services provided in rural and remote schools across parts of Indonesia. C HA P T E R F I V E 28 Box 5. Box 5 (CONTINUED) Monitoring & Evaluation (M&E) teacher service performance, and student learning outcomes will be analyzed. After the transition from PSF to LSP, in 2017, the Facil- ity revitalized its monitoring, evaluation and learning • The ECED process evaluation continued to help the (MEL) framework to better align with LSP’s new man- GoI evaluate which quality enhancement interven- date – supporting the GoI to improve the quality of tions are most cost effective and conducive for scale- life of poor and vulnerable Indonesians through local up with the aim to strengthen GoI decisions about solutions to reduce poverty and inequality. During this providing quality ECED services. The IE is expected period, the LSP Secretariat dedicated significant re- to be finalized in 2018. sources to develop a revised Theory of Change (see Annex 1) and MEL Plan (MELP), which were developed following three facilitated workshops with the LSP Fa- cility team in May, August and November 2017. The CHAPTER 5.1 LSP Secretariat also provided resources to support the operationalization of LSP’s MELP and MEL tools, including the activity-level tracking tool, an influence Beneficiaries experience log, after action review and a reflections workshop, which was used to reflect on and gain consensus increased equity of access to services about LSP’s 2017 achievements and challenges, and future priorities. The findings from these tools were used to support and inform Facility learning and de- cision-making, as well as the LSP Annual Report 2017. Maximizing the availability of services in rural As a Facility, LSP also undertakes various rigorous IE areas and process evaluations to understand the direct im- Enrolment in ECED services varies widely across Indonesia pact from LSP-supported initiatives. LSP uses evalua- and rural areas tend to fall below the national average. For tion results to inform its implementation decisions and example, ECED enrollment in Java is 98 percent, but it is only program planning, along with GoI policy frameworks, 5 percent in the more remote Papua Province. To help im- institutions and systems that guide village develop- prove the availability and access of ECED services at the vil- ment and basic service delivery. For example, in 2017, lage level, LSP continued to implement the two-year ECED LSP undertook the following evaluations: pilot project in 25 pilot districts using a district-based, com- • The Long-Term Generasi IE (fourth round), which munity-focused ECED training system to better link the de- commenced in 2007, was completed in 2017 (see mand and supply sides. The ECED pilot project brought var- Box 7). The results are being used to inform Indone- ious stakeholders, including NGOs, civil society, and village sia’s increasing evidence base about the drivers of community groups together and delivered ECED training. With stunting; and the proposed World Bank INEY oper- over 15,000 trained ECED teachers benefitting from the new ation in 2018, particularly related to anthropometric system, children aged up to six in more than 2,650 remote measurements and related health and nutrition. villages can now access better-trained ECED teachers. More- • The KIAT Guru IE completed the baseline survey, over, many ECED classes take place in, or close to, posyandu which found a teacher absenteeism rate of 25 per- facilities. Capitalizing on the proximity of ECED classrooms to cent in the 270 pilot primary schools. The study also the posyandu facilities, Generasi identified opportunities to found that there are barely any students who have deliver health services and nutritional support to mothers of attained the ability level corresponding to the grade early years children. they currently attend (the majority are generally two The ECED project demonstrated strong demand both from grade-levels behind). The pilot conducted three in- village teachers wanting to participate in the training program tervention models, which combine community em- and from parents for ECED services at the village level for powerment with pay-for-performance of teacher children aged up to six years old. This demand is evident allowance based on community verification and through various district and national government stakehold- evaluation. The endline survey will be completed ers who have expressed their commitment to continuing and by the end of March 2018, when the impact of the expanding the ECED frontline model, and requested technical different intervention groups on teacher presence, assistance to support this effort. For example, at the national level, MoEC will adopt and disseminate the training materials 29 P R OGR ES S TOWAR D S EOFO T WO developed for the ECED pilot project and the lessons learned nationwide. Box 6. MoEC has invited the World Bank to present the ECED pilot findings and Private Sector Engagement training materials at the 2018 National LSP recognizes that collaboration with the private sector can bring more sus- Coordination Workshop of Director- tainable impacts. The private sector not only drives economic productivity ate Teacher for ECED and Community and participation, which generates economic growth, but can also play an Education (Rapat Koordinasi Program important role in filling important service gaps. Pembinaan GTK PAUD dan Dikmas Ta- hun 2018), which will be attended by up As part of the VIP, LSP is assisting GoI to identify and build the capacity of to 500 districts across three regions. about 2,604 village-level TSPs to support villages to implement innovative MoEC will also use the ECED pilot train- ideas as identified through the Bursa Inovasi Desa events. It is intended that ing materials in the annual district Train- these TSPs will include local firms and companies, as well as NGOs, CSOs er of Trainers (ToT), which will be rolled and universities. Through VIP, LSP will support the GoI to assist villages to out across approximately 100 districts in procure services (on fee-basis) to deliver needed projects and activities re- 2018. At the sub-national level, demand lated to entrepreneurship, human capital and infrastructure. As discussed in is evident through the number of district Chapter 5.1, VIP supported initial preparations to identify and train potential governments issuing a new Perbup that TSPs across Indonesia. states that Dana Desa can be used for Going forward, LSP will also pilot a “public, private and people partnership” ECED. Anecdotal evidence suggest that (P4) model of local economic development (LED) that will empower both vil- about one-third of the 25 pilot districts lage farm and non-farm entrepreneurs to form productive alliance, use Dana have issued a new Perbup. In 2018, Desa for productive investment and empower female entrepreneurs. This P4 under the proposed ECED extension, model will be piloted in 2018. LSP will undertake a study to identify and document the number of new Per- bup that were issued as a result of the learning across Indonesia’s villages to identify solutions and better connect villages ECED pilot project. This study also aims so they can access the services they require. LSP leveraged the GoI’s VIP national to document village demand for the platform and Generasi program to design and hold the first round of innovation ECED pilot. Teacher absenteeism in re- knowledge exchange events. In March 2017, Generasi supported the Village Inno- mote areas is high. For example, one vations Festival pilot project in NTB, which brought together over 350 participants in five teachers are absent in remote from LGs, civil society and the private sector to showcase and learn about service schools, which is more than double the delivery innovations. The Village Innovations Festival acted as a pilot to inform the national average. Like ECED, KIAT Guru VIP’s Village Innovation Exchanges (Bursa Inovasi Desa). empowers communities to improve the availability and quality of teachers In 2017, 219 district-level Bursa Inovasi Desa events were held across Indonesia. across remote areas in Indonesia. Using The Bursa Inovasi Desa events brought together 185,900 participants (including an a combination of various initiatives (ser- estimated 55,300 women)26 from 55,302 villages (from 5,481 sub-districts) at the dis- vice agreement, community scorecards, user committees, capacity building and camera monitoring), the pilot project empowered communities to demand better services, and tie their verifica- tions and evaluations with payment of teacher allowance. Initial results indicate that the pilot project has led to positive outcomes in terms of improving teacher presence and service performance (see Chapter 5.3 for further details). Testing innovative ways to better connect villages with services 26 This figure is estimated based on the program technical guidance and protocols which suggest that In 2017, LSP helped MoV operationalize each village should be represented by at least one woman. It is estimated that there was one female par- the VIP and generate innovations and ticipant from each of the 55,302 participating villages. C HA P T E R F I V E 30 trict level to identify and learn from one specific village development issues (e.g. micro-hydroelectricity system, village busi- another about local solutions to local ness development and marketing etc.). This practice is not new in Indonesia and is development challenges. Participants not supposed to replace the current structure of village facilitation. Instead, it aims included village representatives (such to fill the specific skillset and expertise gaps within the existing facilitator structure. as village governments, village councils Under the VIP, TSPs will be engaged to support villages that do not have the tech- and community leaders), sub-district of- nical skills or capacity to replicate and implement innovative ideas (LED, human ficials, different district-level agencies capital and infrastructure ideas) as identified through the Bursa Inovasi Desa events. (dinas), and in some cases Technical The VIP Operation aims to improve the availability and accessibility of good quality Service Providers (TSP).27 In 2017, the TSPs. It is intended that the TIKs will verify and develop a directory of TSPs at the events generated over 9,454 village district level. Meanwhile, the TPID will support villages and TSPs to connect at the innovations ideas or “idea cards” (Kar- kecamatan level. As part of the VIP, LSP is assisting the GoI to identify and build the tu IDE, or Inovasi Desaku),28 including capacity of about 2,604 village-level TSPs. In 2017, this involved supporting the iden- 5,929 ideas related to entrepreneur- tification of initial TSPs in 130 districts and preparing training materials (three mod- ship, 3,018 human capital ideas and ules on entrepreneurship, infrastructure and human capital development), which will 507 village infrastructure ideas. The be used to train 12 grandmaster trainers, 30 master trainers and then a further 294 generated ideas were wide ranging and trainers and 2,604 TSPs. included innovations related to waste recycling, using an online ticketing system to encourage village-level tour- ism, village product improvement and CHAPTER 5.2 packaging, and improving the quality of PAUD and posyandu services. More Outcome 2: Beneficiaries than 31,600 village “commitments” to replicate innovations were also made at the Bursa events.29 To support the roll- increasingly utilize services out of the Bursa Inovasi Desa events, 1,302 district facilitators, 434 District Strengthening sub-national support to maximize service Agency of Community and Village utilization Empowerment (Dinas Pemberdayaan Masyarakat dan Desa, or DPMD) offi- To improve and expand the delivery of health and education services, Generasi cials and 66 provincial (DPMD) officials expanded its Village Law integration pilot project from six districts in 2016 to 44 dis- were trained on village innovation. Fur- tricts in 2017. As highlighted earlier, in 2017, Generasi provided technical assistance ther, 363 district innovations teams (Tim to national and provincial project consultants to produce a training package for facil- Inovasi Kabupaten, or TIK) and 5,362 itators to improve the delivery of health and education services in Generasi villages. sub-district implementing innovations Generasi also supported refresher training for all 38,314 (51 percent female and 49 teams (Tim Pelaksana Inovasi Desa, or percent male) Generasi village actors (local facilitators, village officer, and health and TPID) were established. education cadres) in 11 provinces and training for 564 posyandu staff. LSP also supported MoV to establish the In 2017, LSP monitoring data showed that Generasi’s ongoing efforts have improved Technical Service Providers (TSP) mod- key access and utilization indicators in Generasi villages including increases in the el under the VIP platform. The TSP con- percent of: cept involves a third-party facilitation • expectant mothers receiving four prenatal care visits (villages in 11 provinces); and capacity-building model for villages • junior secondary school enrolment rates (villages in 11 provinces); whereby villages can procure or hire in- • women participating in pregnancy and nutrition classes (villages in three provinces) 30; stitutions and/or skilled individuals (e.g. and local firms, NGOs, CSOs and universi- • parents of zero-to-two-year olds participating in monthly parenting and nutrition ties) to provide technical assistance for classes (villages in three provinces);30 (Figure 6). 27 TSPs can include a range of third parties including local firms, NGOs, CSOs and universities. The TSP concept is a third-party facilitation and capacity-building model for villages. 28 Idea cards are for innovation ideas that villages have implemented but are not yet captured and documented. Villages can bring innovation ideas to the Bursa events for the District Innovation/Sub-District Innovation Teams to review. If the innovation ideas meet the VIP Innovation criteria, the innovations can be captured and showcased as a “village innovation” during the next Bursa event. 29 Commitments refer to the instances where villages at the Bursa events committed to replicating an innovation in their own village. During the Bursa events, these commit- ments were recorded by village representatives on “commitment cards.” 30 The three provinces (West Kalimantan, Central Kalimantan and South Sumatera), which received block grants in 2017. 31 P R OGR ES S TOWAR D S EOFO T WO FIGURE 6 Strengthening village-level facilitators’ capacity to Generasi Service Utilization Indicators mobilize communities (for fiscal year 2017) Building on findings and lessons learned from the Generasi Long-Term IE (see Box 7) and the LSP-supported knowledge exchange to Peru with key Pregnant women receiving Assisted deliveries by a GoI counterparts (see Box 8), LSP prior- four prenatal care visits trained professional itized strengthening the capacity of vil- lage-level facilitators to mobilize com- munities to better utilize local services (e.g. attending posyandu). Following high-level discussions between Presi- dent Joko Widodo, Minister of Finance Pregnant women participating in monthly Parents of 0-2 years old participating in Sri Mulyani Indrawati and World Bank pregnancy and nutrition classes* parenting and child nutrition classes* President Jim Yong Kim in July 2017, Generasi launched preparations for the Human Development Worker (HDW) Pilot Project. Building on Generasi’s approach, the HDW pilot project aims Junior secondaryschool Monthly weighing of to test a model for involving villages enrolment rates children under age 3 in frontline service delivery to address local service delivery challenges. The HDW model provides a mechanism for districts to support villages to plan and implement national priority programs, Male caregivers participating in pregnancy Women involved in planning and such as stunting reduction. It is intend- and child nutrition classes* decision-making ed that HDWs will use a range of tools (checklists, scorecards, stunting length *Only relates to 3 provinces (not 11 provinces). mats and social mapping) to over- Box 7. come key information gaps, diagnose local drivers of complex development Generasi Long Term Impact Evaluation problems (such as stunting), and help In 2017, LSP completed a “fourth wave” Impact Evaluation of the Generasi Sehat monitor and demand improved service and Cerdas Project, which originally started in 2007. The Generasi Long-Term delivery. HDWs include health cadres, Impact Evaluation (Generasi L/T IE) provided a rare and unique opportunity to ECED teachers and staff, and regular learn about the longer-term impacts of the project. Following analysis of the final village development cadres (KPMD) dataset, MIS data and village budget data in 2017, the main findings relating to who are all involved in village plan- the Project’s intermediate outcomes and impacts were presented to Bappenas ning and budgeting processes. The in early 2018. The intermediate outcomes consisted of pre- and post-natal care, pilot project will be implemented in birth delivery, immunizations, iron pills, Vitamin A distribution, and school partici- 3,105 villages across 281 sub-districts pation indicators, while the impacts related to malnutrition and stunting. and 31 stunting priority districts to help The L/T IE found that stunting declined among zero-to-three year olds from al- promote, incentivize and converge most 40 percent to 26 percent between 2009 and 2016, with no detectable dif- multi-sectoral village efforts to reduce ference between the control and Generasi locations. However, the L/T IE found stunting. The first 30 HDWs are expect- that the Project continued to effectively mobilize community members to attend ed to be trained in January 2018. It is the village health posts (posyandu). intended that the pilot project will in- Findings from the Generasi L/T IE are contributing to Indonesia’s evidence form the GoI’s national scale-up (up to base about the drivers of stunting, and future GoI priorities related to stunt- 75,000 HDWs) as part of the National ing and Village Law expenditures on health and education challenges. Action Plan to reduce stunting. The Generasi L/T IE is also informing the Investing in Nutrition and Early Years (INEY) Program-for-Results operation, particularly findings relating to the role of communication mobilization, social accountability and technical measurement of stunting. C HA P T E R F I V E 32 Box 8. Stunting as National Priority Agenda About 37 percent or approximately nine million children in 3. Geographical targeting of vulnerable low-income Indonesia are stunted, affecting their education and health populations; at an individual level, and hampering economic growth and 4. Performance-based budgeting; labor market productivity at the national level. Over the 5. Alignment of incentives for households, health facili- past several years, the World Bank has supported a range ties and local government; and of high-level policy dialogue, operations and pilots, ongo- 6. A credible data information system, clear and achiev- ing technical advice and analytical work in multiple sectors able targets, and a monitoring and evaluation system. (health, education, social protection, water and sanitation The experience in Peru also helped reinforce the idea (WASH), social development and governance) that gener- of using specialized local facilitators, known as HDWs, ated useful lessons on the technical content, implementa- to become the driving force in converging multi-sec- tion modalities and enabling environment to effectively ad- toral efforts at the village level to address stunting. As dress the nutrition and early years agenda. In 2017, LSP, and a result, a Generasi pilot project (the HDW pilot proj- other World Bank teams, were instrumental in developing ect), which adopts the HDW approach, commenced and launching a multi-sectoral national strategy to reduce preparations in 2017. stunting. During the reporting period, LSP supported various high-level meetings, supported dialogue across multiple LSP’s efforts, along with other WorldBank teams, result- ministries, and provided inputs into two cabinet meetings in ed in the GoI identifying stunting as a national priority July and August 2017. LSP’s ongoing knowledge exchange and developing a Presidential National Action Plan. The program with Peru, Nepal, and other countries also helped National Action Plan aims to converge or bring togeth- enrich learning experiences of government officials (from all er existing national, regional and community programs countries) about best practices and successful interventions to deliver a set of priority nutrition-specific and nutri- in addressing malnutrition through a multi-sectoral conver- tion-sensitive interventions in the first 1,000 days of a gence approach. Specifically, in April 2017, LSP leveraged its child’s life and up until age six. The World Bank’s recent access to international expertise and global knowledge to capacity-building efforts further cemented the World support a knowledge exchange field trip delegation of key Bank’s strategic position to support the operationaliza- GoI officials (from MoSA, MoF, MoHA, MoV, Bappenas and tion of the GoI’s convergence strategy. The GoI has re- Kemenko PMK) to partake in a study visit to Peru to look at quested a new World Bank operation - Investing in Nu- its positive experiences in reducing stunting—despite sig- trition and Early Years (INEY) Operation - and additional nificantly higher poverty levels than in Indonesia. Key fac- support from LSP for the National Action Plan. The INEY tors and learnings from Peru that can be linked with policy Operation, which commenced preparations in 2017, will changes in Indonesia include: support the GoI’s national stunting agenda through build- 1. Strong political will and commitment at the highest level; ing on lessons learned from Generasi and the ECED pilot 2. A coordinated multi-sectoral program that included project, as well as other GoI executed programs. TNP2K health, nutrition, ECED, WASH, and Social Protection in- will be the implementing agency for the INEY Operation. terventions; In Rindi Sub-district, East Sumba in East Nusa Tenggara, the Local Health Office, education institutions and Generasi sup- ported a school-based program to raise awareness about good personal hygiene and sanitation. Generasi promoted good hand-washing techniques, provided water dispens- ers and distributed personal hygiene sets to 14 elementary schools in Rindi Sub-district. Sukmayani, the visiting doctor from the local community health centre (puskesmas), said the community-led, total sanitation program has helped de- crease the number of cases of sanitation and hygiene-relat- ed diseases among children in the area – “January through March usually has the highest prevalence of diarrhea among children but this year, the number is lower.” 33 P R OGR ES S TOWAR D S EOFO T WO CHAPTER 5.3 Outcome 3: Beneficiaries have improved quality of health and education services Improved access and utilization of ba- ties, through school-user committees, members of the school-user commit- sic services do not necessarily result in evaluating teacher service perfor- tees, improved from 65 percent (mid- in improved development (health and mance. During the reporting period, 2016) to 93.4 percent (December 2017), education) outcomes if the available all provider groups (teachers and prin- which is beyond the 80 percent target. services are of poor quality. Given cipals) and user groups (parents and Meanwhile, perceived teacher service that health and education outcomes community representatives) agreed quality increased from 56 percent to are still lagging despite increased GoI to its use in all 203 targeted primary 96 percent (target: 85 percent) in the spending, LSP, in line with the GoI, is schools across the five pilot districts. same period.31 The direct impact of the increasingly shifting its support to- pilot project will be better understood wards improving the quality of basic following the completion of the IE’s TEACHER PRESENCE, services. To do this, in 2017, LSP sup- endline survey on teacher attendance, AS REPORTED BYMEMBERS ported a range of initiatives to help em- teacher service performance and stu- O F T H E S C H O O L- U S E R power communities to demand better dent learning outcomes in March 2018. COMMITTEES, quality services. Data on student utilization of primary I M P R O V E D F R O M school services will also be collected. Empowering citizens to Given the pilot’s initial positive out- monitor and demand better comes, MoEC and TNP2K expressed quality services their support to determine how the pi- lot project could be scaled-up across The KIAT Guru pilot project is helping all of Indonesia’s 122 disadvantaged WHICH IS BE YOND to improve the quality of education ser- 8 0 % TA R G E T districts (Pembangunan Daerah Tert- vices in remote villages by empowering inggal, or PDT), and/or modified and communities to monitor and evaluate applied to urban contexts. teacher attendance and performance PERCEIVED TEACHER in pilot primary schools. In Indonesia, The GoI has recently made large in- S E R V I C E Q U A L I T Y teacher salary and allowances totaled vestments in ECED nationally, but not INCREASED FROM US$16.5 billion in 2016, but improved a large investment in the quality of teacher welfare has not led to improved services provided. International expe- teacher performance or student learn- rience shows that high-quality teachers ing outcomes. In KIAT Guru pilot loca- are key to delivering high-quality ECED tions, one in four (25 percent) of 2,301 ( TA R G E T 8 5 % ) services and child development out- teachers were missing from the 270 comes. In the ECED project, enhanced I N T H E S A M E P E R I O D 31 remote primary schools visited during training resources were adapted for the unannounced baseline survey. This the village context and introduced in all resulted in 23 percent of classrooms Initial results from a KIAT Guru pro- 25 pilot districts in 2017. The new dis- with no teachers, and 6,926 of 31,076 cess monitoring (conducted at the end trict-based, community-focused ECED students not learning. To improve the of 2017) indicated that tying teachers’ teacher training system was estab- quality of education services, the KIAT special allowance (TK) payments to lished in all 25 pilot districts and all Guru pilot program implemented var- a combination of scorecards to mea- targeted teachers were trained in ious empowerment initiatives (com- sure teacher performance and the the basic competencies emphasized munity scorecards, user committees, KIAT Kamera mechanism (see Box 9 in the new system. This ECED teach- capacity building, and camera appli- and Box 10) to measure teacher pres- er-training system has demonstrated cations) to improve teacher service ence is having a positive impact on its capacity to leverage existing GoI performance and student learning out- teacher attendance, teacher service comes. In 2017, KIAT Guru continued performance, and student learning World Bank. 2018. Implementation Status and 31 to refine and implement a community outcomes. The results showed that Results Report. Indonesia: Improving Teacher scorecard system to engage communi- teacher presence, as reported by Performance and Accountability. January 2018. C HA P T E R F I V E 34 training programs to deliver profes- sional training to – and thus improve Box 9. the quality of – ECED teachers in poor and remote villages. It is estimated that Delivering Innovative Initiatives approximately 170,400 children have In 2017, LSP trialed innovative ways to achieve results, including introducing benefited from the improved ECED new ways to engage and empower communities to deliver, monitor and de- services across the 25 pilot districts.32 mand improved services: The system also has the potential to be continued by delivering post-basic • LSP’s KIAT Guru pilot utilizes KIAT Kamera (Box 10), an innovative tam- training through knowledge exchange per-proof Android-based application, to provide accurate data on daily with trainers. In addition, case studies teacher attendance in rural primary schools. Android mobile phones are on the ECED pilot project were un- provided by the pilot project to schools taking part in the project and up- dertaken in three of the 25 pilot dis- loaded with the KIAT Kamera application. This app calculates the total num- tricts to provide feedback about the ber of hours of presence of each teacher every school day. This indicator, potential sustainability and scalability in conjunction with performance indicators measured using scorecards of the pilot project, and the possible evaluated by members of the school-user committees, determines the constraints in scaling up the project to amount of teacher special allowance (TK) payable to individual teachers. other sub-districts in the pilot districts • The ECED pilot’s major innovation was the design, provision and imple- and to other districts. Additional case mentation of a new village-based community-focused ECED teacher studies are planned for 2018. Initial training system in 25 pilot districts. The approach was novel as it brought results from LSP supervision and the together different, and previously disconnected, actors at the sub-dis- forthcoming ECED process evaluation trict level (district government, community groups and civil society) and indicate community satisfaction with bridged the communication gaps between these stakeholders to deliver the trained ECED trainers and positive a ECED training program. Further the new village-based system was more improvements in the way ECED teach- accessible compared to the current system, which is top-down approach ers interact with children. The ECED delivered at the national and provincial level and is expensive and incon- process evaluation is expected to be venient for teachers in rural and remote areas. The ECED pilot brought completed in 2018 and will identify how together disparate elements that had never been integrated in the Indo- the pilot improved teachers’ compe- nesian content to expand teachers’ access to high-quality professional tency. Lessons learned will also inform development ECED training. preparation for potential scale up and/ or integration with Dana Desa. 32 The ECED pilot project did not collect primary data on the number of children under the care of each ECED training participant’s local ECED service. However, the ECED pilot project conducted a survey of 600 randomly surveyed ECED teachers. Analysis from the survey found that the average ECED teacher-to-children ratio for the surveyed teachers is approximately 1:11. This ratio was used to determine the approximate number of children that benefited from the improved ECED services. 35 P R OGR ES S TOWAR D S EOFO T WO Box 10. Camera App a Catalyst for Teacher Performance Improvement in East Nusa Tenggara It was almost 7:30 a.m. and the mented in 203 primary schools in five disadvantaged districts. The program principal and teachers at Mboeng uses three intervention models: (1) community empowerment; (2) community Elementary School (SDN Mboeng) empowerment and tying teacher allowances to their attendance; and (3) com- in remote Kaju Wangi Village, Elar munity empowerment and tying teacher allowances to their service quality. Sub-district in Manggarai Timur, Over a three-month period, SDN Mboeng carried out the second intervention East Nusa Tenggara, took turns to model where teachers and the principal have to clock in using a camera app. take each other’s photographs with The community then verifies teacher presence and evaluates teacher service a cellular phone. They were not performance using community scorecards. This model worked wonders in re- about to update their social media ducing the rate of teachers’ absenteeism and late attendance. profile pictures, but instead were taking part in the KIAT Guru pilot “In the past three months, none of the teachers were late. And it trickles down program, which aims to improve ed- to the students. Seeing their teachers disciplined, the children are now in or- ucation service delivery in remote der too. They are better mannered and they rarely come late anymore even villages by empowering communi- though many of them have to walk for 30 minutes to one hour to get to school,” ties to verify teachers’ attendance said Andreas Jemahang, a KIAT Guru cadre whose son also studies at the ele- and evaluate service performance. mentary school. Teacher attendance was an issue in Initial results, from a baseline student learning assessment and a diagnostic test Kaju Wangi Village. Some teachers for Bahasa Indonesia and mathematics, indicate the program’s positive impact would often arrive 90 minutes after on student learning outcomes too. class was supposed to start, if they “The baseline student learning assessment was conducted in September 2016 came at all. An unannounced visit to and it showed how six third-graders did not fare well in reading. In June, there SDN Mboeng on October 31, 2016 was a diagnostic test on these students and the results were exhilarating. The found that one in six or 17 percent six can now read well, two of them met the basic standard for second grade, of teachers were absent. two fit the third grade standards and one even passed the fourth grade stan- To help address teacher absentee- dard,” said Karolina Lantu, a third grade homeroom teacher. The pilot imple- ism, the KIAT Guru pilot program mentation and its impact evaluation will be completed in 2018. began in July 2016 and was imple- C HA P T E R S I X 36 Progress Towards EOFO Three: National and Local Governments Make Better Use of Financial Resources LSP helps the GoI ensure that its resources achieve their intended development and poverty objectives. During 2017, LSP provided technical analysis on fund flows and resource allocation formulas to ensure that the money is going to where it is most needed. It also provided support on governance and accountability systems, based on evidence and domestic and global best practices, to help ensure that resources are being used in more efficient and effective ways, and that the poor and vulnerable groups are more integrated into the development process at the local level. In order to track how resources are being spent and generate data that the national and local governments can use to make more informed decisions, LSP provided analytical and capacity-building support for financial management and M&E systems across the different levels of government. LSP also tested innovations, through pilot projects and accompanying analytical support and TA, to identify opportunities for high impact, transformational change through large-scale expansion. At the national 06 level, LSP’s efforts have influenced and strengthened national policy agendas and systems, including making the 2018 Dana Desa Allocation Formula more pro-poor; strengthening VFM regulations (revised Permendagri No. 113/2014) and tracking systems (Siskeudes); and generating greater knowledge about how villages spend their increased fiscal resources (ViPER). Meanwhile at the sub-national level, LSP’s efforts have contributed to promising outcomes in terms of increasing LGs’ awareness about, and ability to, plan and budget funds more effectively. This will be an increasing focus going forward. 37 P R OGR ES S TOWAR D S EOFO T HR E E CHAPTER 6.1 Outcome 1: Strengthen national frameworks and systems for tracking village finances and outputs Village financial management is an im- carefully reclassifies village budgets and expenditures to standard classifications portant building block for improving to provide a more reliable view of village revenue spending. ViPER highlighted im- Village Law implementation, account- portant trends in village spending, including the fact that the sampled 1,868 villages ability, transparency and performance. spent on average 39 percent of their annual revenue on administration (more than Without consistent quality tracking of vil- the 30 percent ceiling) versus only 5 percent for health and education. These find- lage finances and outputs, governments ings triggered LSP to provide TA to MoHA to revise its regulation (Permendagri No. and citizens do not have sufficient in- 113/2014) governing VFM. Among the inputs to revise the draft regulation was a push formation on how village finances are to re-classify village activities and associated finances and outputs (see Box 11). To spent, which limits their ability to make date, ViPER results have been shared with MoF, MoHA, MoV as well as the office informed decisions and take corrective of the President. MoHA further plans to revise an existing regulation on APBDes actions to maximize the development evaluation to include the ViPER methodology as the main tool for assessing Village impact of the significant amounts of Budgets and Realization Reports. Work was also initiated with MoHA to present resources being channeled down to the ViPER methodology to LG officials to improve their skills in aggregating and villages. While the Village Law outlines analyzing village financial data and expenditures. Together, these developments the rules and responsibilities for track- indicate that ViPER is on its way to being institutionalized in government systems ing village finances, in practice, weak and mechanisms. supporting regulations and systems and The Village Law PASA also completed a survey monitoring report on Dana Desa limited capacity hinder reliable data col- disbursements. The survey found that there have been improvements in Dana Desa lection and tracking. disbursements since 2015, flagging specific district and village constraints that con- tinue to reduce timeliness of village transfers. For example, some constraints in- Understanding constraints cluded unclear national regulations on village priority setting; delays in preparing to disbursing and tracking and enacting Perbup and evaluating village budgets and reports; and difficulties village finances with villages preparing budgets, compiling receipts, and developing realization re- During 2017, the Village Law PASA ports. The findings have contributed to LSP’s work on VFM; as well as deepen the used results from its analytical studies Facility’s increasing focus on assessing districts and sub-districts’ capacities to ad- to provide evidence-based advice to equately support, supervise, and oversee villages. The disbursement monitoring the GoI to help inform and strengthen work triggered MoF to revise their regulations (into PMK No. 50/2017 and updat- VFM frameworks and systems. As high- ed to PMK No. 112/2017). Specific improvements that influenced the preparation of lighted earlier, LSP expanded the ViPER PMK No. 50/2017 include: (i) output reporting (the disbursement monitoring showed Analysis, with an additional sample of limited output information from Dana Desa); and (ii) the GoI introduced a stricter 1,868 villages, to provide the GoI with absorption reporting requirement for the next tranche disbursement. The disburse- the most in-depth review currently avail- ment monitoring survey also acted as an impetus for the proposed revisions for able in Indonesia on how villages spend Permendagri No. 113/2014, particularly related to chart of accounts (COA) and asset their increased funds. Currently, stan- reporting. The disbursement monitoring analysis also prompted MoF to require DG dard village spending reports provide a Treasury to work with DG Fiscal Balance to monitor funds disbursement and output distorted picture of how villages spend reporting from Dana Desa through the Treasury Payment offices (Kantor Pelayanan their funds, in part due to challenges Perbendaharaan Negara, or KPPN) and On-Line Monitoring through the National with how village activities and expendi- Treasury System (Sistem Perbendaharaan dan Anggaran Negara, or OMSPAN). tures are grouped and classified. ViPER, Strengthening VFM regulations and systems initiated in 2015, seeks to address this shortcoming. In partnership with MoHA The ViPER findings, especially on inconsistencies on how villages classify their fi- (Bina Pemdes), the ViPER team collects nances, contributed directly to extensive TA to MoHA to help draft its revised reg- village budgets and spending reports, ulation on VFM (Permendagri No. 113/2014) (Box 11). Specifically, a Village Law PA- enters them into a database, and then SA-supported consultant provided substantive analysis and recommendations to C HA P T E R S I X 38 the MoHA team in drafting the regulation, including on strengthening village finan- Box 11. cial classification, budgeting, reporting requirements and expenditure management, among other topics. The revised regulation is expected to be enacted in 2018 and Influencing Policy will set the stage for how villages manage their finances. It will be vital in simplifying Change - Revised budgeting classifications and enabling the aggregation of fiscal data, as well as Permendagri No. 113/2014 clarifying the specific roles of the various GoI entities and reducing overlapping authorities. Village financial management (VFM) is outlined by the Permendagri No. The Village Law PASA also continued to provide TA for the rollout and upgrading of 113/2014 (2014), however there are a village financial management application (Sistem Keuangan Desa, or Siskeudes) key weaknesses in the regulation, that provides village governments with a tool to better account for the use of their such as limitations with the classifica- village funds by submitting standardized budgets and realization reports. LSP pro- tion structure which make it difficult to vided TA to support improvements to the Siskeudes system, a trial before the appli- undertake useful analysis of financial cation was launched, and training modules to support the rollout. As of December data and produce activity and output 31, 2017, 70,380 villages in 418 districts received information on Siskeudes, 68,940 reporting. village in 413 districts received training/workshops on Siskeudes, and 64,756 villag- The Directorate General of Village es in 403 districts had the Siskeudes application uploaded and running. Government Guidance (Bina Pe- Going forward, BPKP and MoHA will upgrade the Siskeudes application to match the merintahan Desa or Bina Pemdes), revised Permendagri No. 113/2014, add a village output module, help more villages MoHA, with the support of LSP and connect Siskeudes to districts and allow districts to consolidate village spending KOMPAK, is currently revising the data, and link Siskeudes with the MoF’s database, OMSPAN. Together, this work pro- regulation to incorporate strength- vides important building blocks for improved village governance and accountability. ened VFM principles and elements. Specifically, LSP provided analytical The Village Law PASA is planning to soon aid MoF (and MoHA) to standardize output support to inform the revision and nomenclatures (activity and output labels) as well as standardize output metrics to supported the drafting of the revised ensure consistency in output reporting. By overlaying the output data on socio-eco- Permendagri. It is envisioned that the nomic information, it is expected that government capacities to understand the con- revised regulation will: (i) improve vil- tribution of outputs to socio-economic indicators will be strengthened. lage budget classifications and chart of accounts for village finances which will allow sectoral analysis of village finances; (ii) require activity and out- put reporting; (iii) strengthen procure- ment processes, including adjusting to the GoI’s 30 percent cash for work requirement; (iv) require village bank accounts to be updated and reported to districts and MoHA; and (v) clarify and strengthen rules for providing information to communities and en- suring participation related to village finances, including the requirement to disseminate financial and non-fi- nancial realization, activity implemen- tation status, and contact information for complaints handling. The revised Permendagri will help contribute to the GoI’s ability to bet- ter track, aggregate, report on, and understand how villages spend and manage their increased funds. It will Gondang Village becomes one of the first villages in Lombok Island in West Nusa also help enable more meaningful Tenggara to apply Siskeudes in all stages of village funds management: planning, community and civil society participa- implementation and reporting. The village became one of the pioneers in applying tion in VFM. Siskeudes and had been visited by many other villages in West Nusa Tenggara that wish to study the application. 39 P R OGR ES S TOWAR D S EOFO T HR E E CHAPTER 6.2 Outcome 2: Pilot villages demonstrate financial allocations that are equitable, needs-based and pro-poor Making Dana Desa FAIRER AND more pro-poor In 2017, LSP’s Village Law PASA, together with KOMPAK, supported the Directorate General of Fiscal Balance (DJPK) to revise and make the 2018 Dana Desa Allocation Formula more pro-poor (see Box 12). Specifically, LSP provided analytical support to DJPK, including simulations, to better understand the poverty impact of different allocation formula scenarios. In December 2017, the new formula was approved and issued (PMK No. 199/PMK.07/2017). Given that there is a possibility that the Dana Desa formula allocation in 2019 will be increased to Rp 120 trillion, strengthening capacities of government officials to assess the impact of the formula on (i) poverty indicators, (ii) inequality indicators, (iii) large and small villages, (iv) villages in Java and non-Java areas as well as (v) villages by typology (Mandiri, Maju, Berkembang, Tertinggal and Sangat Tertinggal) is critical. Box 12. Influencing Policy Change – Revised 2018 Village Fund (Dana Desa) Allocation Formula Weekly community In 2017, LSP and KOMPAK supported DJPK to make the 2018 Dana Desa Al- meeting in Ngada District, location Formula, and thus made four percent of the national budget more pro-poor. Prior to 2018, the Dana Desa allocation formula disproportionately East Nusa Tenggara. favored villages with a small population as the formula was mainly allocated on a “per village” rather than “per capita” basis. Ninety percent of Dana Desa was It is regulated to have distributed equally among villages and the remaining 10 percent was allocat- representative of female ed based on population size, poverty rate, land area and geographic terrains. While the “per village” allocation perceived to treat villages fairly, it did not treat villagers in the meeting. people living in the villages equally. In this the weekly Over 2017, LSP provided extensive analytical support to DJPK, including run- community meeting ning simulations, to better understand the poverty impact of different allocation formula scenarios. LSP also facilitated various discussions with officials from (in ward level), the echelons I and II in MoF. The outcomes from these simulations and discussions villagers discuss the were used to inform DJPK’s allocation formula adjustments for 2018. usage of village funds The new formula reduces the basic allocation from 90 percent to 77 percent; includes a new three percent affirmation allocation for Disadvantaged and Very to develop their villages. Disadvantaged Villages that have a high poor population; and increases the formula allocation portion from 10 percent to 20 percent, as well as adjusting the weight of each variable to be more pro-poor. The Dana Desa Allocation formula adjustment represents a positive step towards making the Dana Desa more equitable as it better ensures that funds go to where the needs are great- est. The formula will be reviewed annually to ensure continuous improvements to the allocation of Dana Desa. C HA P T E R S I X 40 CHAPTER 6.3 Outcome 3: Village communities and government have improved capacity to manage increased finances Under the Village Law, villages have ac- mission on village capacity building for financial management and conducted a cess to increased fiscal resources, and village audit in July 2017 by visiting Kutai Barat District. Learning from West Ben- more management and implementation gal, the District Inspectorate of Kutai Barat developed Guidelines for Risk Man- responsibilities. Yet village capacities, agement, which are already used by all district government units. to fulfil these expanded responsibilities, • Based on lessons from West Bengal, BPKP and MoHA Inspectorate General (IG) remain limited. During 2017, LSP provid- finalized VFM oversight guidelines, which will be used for local inspectorates in ed TA, and analytical and capacity sup- conducting oversight to villages which include guideline for monitoring, review, port to inform and improve the GoI’s and evaluation and audit of villages FM. communities’ capabilities to manage the As mentioned in Chapter 6.1, Village Law PASA also supported BPKP to socialize and increased resources. rollout the enhanced Siskeudes application in 64,756 villages. It is envisioned that Encouraging national the Siskeudes uptake will significantly improve villages’ ability to report on village cross-agency knowledge spending and outputs. It will also help higher-level government aggregation, analysis exchanges and systems and reporting. strengthening In early 2017, LSP brought a 15-mem- Box 13. ber Indonesian delegation from MoHA, Sustainable Investments MoF, MoV, BPKP, Bappenas and district government representatives to West To ensure greater sustainability, LSP prioritizes supporting and leveraging ex- Bengal and Tamil Nadu in India to share isting GoI programs and investments. LSP, through its inherent design, focuses experiences on strengthening village on strengthening existing government systems, policies and institutions to im- governance and village poverty reduc- prove the development and poverty impact of the GoI’s large programs, such tion using tools to enhance ownership as the Village Law (under the RPJMN 2015-2019), which aims to enhance village of local communities and downward ac- development and basic service delivery. It does this through various approach- countability to these communities. The es, including by providing analytical and technical support to inform govern- officials were subsequently invited to ment policy decisions and regulations (revised Permendagri No. 113/2014, a half-day post-Knowledge Exchange Permendagri LKD and LAD, and the revised Dana Desa allocation formula), workshop to gather inputs and lessons facilitating policy dialogue, and supporting the implementation and scaling up learned, as well as to develop an action of pilots and activities nationally within GoI systems (including the integration of plan from each ministry. As a result, nu- Generasi with Village Law and the new INEY operation; and the potential scale- merous lessons learned – from institu- ups of the KIAT Guru and ECED pilot projects). tional and community oversight to the LSP also focuses on building GoI and other partners’ skills and capacity to capacity building of village and LG offi- ensure they have the required capabilities and human resources to continue cials, and the application of an inclusive the work. For example, as part of the Generasi Integration Strategy, LSP con- livelihoods model used in Tamil Nadu, tinues to build the capacity of facilitators and local governments to help better were discussed for possible piloting in integrate health and education services into village budgets and Dana Desa Indonesia. Some examples of GoI up- spending. Building on LSP’s ViPER analytical support, the Facility also initiated take include: work with MoHA to present the ViPER methodology to Local Governments to • BPKP developed and is in the pro- improve their skills in village financial data management and analysis. cess of rolling out a new module for By supporting existing GoI priorities and enhancing the capacity of local coun- Siskeudes that tracks village outputs terparts and partners to sustain them, it increases the likelihood of continued (building on the West Bengal experi- uptake and enduring benefits after the trust fund closes, as government buy-in, ence). commitment, funding and resources are already in place. • The World Bank supported a scoping 41 P R OGR ES S TOWAR D S EOFO T HR E E Strengthening local governments’ capacity to plan and In addition to the Village Law PASA, budget funds more effectively Generasi continued to support district and sub-district facilitation to help LGs As highlighted in Chapter 4.3, LSP supported LGs in Generasi and the ECED pilot better monitor progress on key human locations to use their fiscal resources more effectively. For example, as part of the development and service delivery indi- Generasi Integration Strategy pilot project in six NTB districts, Generasi provided cators and track APBDes expenditures operational funds for capacity building and supported LGs to draft district policies on health and education in the Gener- that enable APBDes to be utilized for health and education services. Generasi’s asi Management Information System support contributed to LGs issuing six district regulations. LSP data indicated that on (MIS).33 As a result of Generasi’s efforts, average village APBDes allocations for health and education spending increased in data monitoring was completed and the 411 villages in the six NTB Generasi Integration Strategy pilot districts. submitted in 411 out of a total sample of 470 villages, with all data entered CHAPTER 6.4 into the MIS. As highlighted earlier, the Outcome 4: Data-driven planning data showed on that average APBDes allocations for health and education and budgeting at the local level are spending in 411 villages in the six NTB pilot districts increased (Chapter 4.3) strengthened and that key access and utilization in- dicators in Generasi villages across 11 provinces have improved (Chapter 5.2). Strengthening national systems and regulations to support more data-driven planning and budgeting at the Supporting local local level governments to implement data-driven planning and As under EOFO 1 Intermediate Outcome 3, during 2017, LSP provided TA (in- budgeting cluding providing technical support via joint field visits, workshops, and reviews of draft regulation and systems), at the sub-national and national levels, across At the sub-national level, building on multiple programs to help strengthen data-driven planning and budgeting at the the success of the World Bank’s previ- ous Rapid Assessment and Action Plan sub-national level. As highlighted in Chapter 6.1, Village Law PASA provided TA project, LSP launched the MELAYANI to BPKP to support continuing improvements to the Siskeudes application, which project, which uses a problem-driven was rolled out in 64,756 villages. This support helped improve the GoI’s ability approach to tackle local service de- to eventually aggregate VFM reports and better understand how villages spend livery challenges. The pilot is helping their money (see Chapter 6.1 for further details). Village Law PASA also facilitated district governments to use existing data a coordination meeting between MoV, the State Administration Institution (Lem- to analyze and solve problems (related baga Administrasi Negara, or LAN) and the Ministry of Justice to develop joint to health, education, infrastructure, pub- training modules for evidence-based legislative drafting and Regulatory Impact lic housing, security and social protec- Assessments (RIA). The training modules are still being developed. Training is tion), and to regularly review and adjust expected to be conducted in February 2018 and will be open to all ministries implemented solutions. As highlighted involved in Village Law implementation. earlier, in 2017, the World Bank-support- ed coaches supported the three district pilot governments (Bojonegoro, East Java; Kubu Raya, West Kalimantan; and Belu, East Nusa Tenggara) to select an issue they would like to address, iden- tify team members for the district prob- lem-solving teams, and commence the baseline data collection. In 2018, the pilot district governments will focus on analyzing the baseline data to under- stand the local problem(s) and to sup- port change processes (as guided by the World Bank-supported coaches). The pilot project’s impact will be assessed in October 2018 and the results reported in 33 The Generasi MIS includes village-level data, which is collected by facilitators, validated at the provincial level and shared to the national level. the next progress report. C HA P T E R S EV E N 42 Gender and Social Inclusion 07 Opening up opportunities for women is one of the most important engines of poverty reduction. In the case of Indonesia, while the country has made significant progress in recent years, the potential for women to become substantial drivers of poverty reduction is yet to be fully realized. Although Indonesia has seen major improvements in girls’ access to, and participation in, education, and an increase in the number of employment opportunities over the past few decades, women still lag behind men in labor force participation. Global experience shows that increasing women’s participation in the labor force has a direct positive impact on economic growth. In addition, improving women’s outcomes more generally in health, education and employment help to reduce the inter-generational transmission of poverty in society and improve future outcomes for children, ranging from better anthropometric (i.e., height and weight measurements) indicators to more schooling and thereby better labor market outcomes. During 2017, LSP promoted and supported the GoI to promote gender equality and social inclusion: 1. Maximizing women’s labor force participation and access to economic opportunities: LSP supported National Civil Servant Organization (Badan Kepegawaian Negara, or BKN) to analyze the records of over four million civil servants to better understand the composition of the Indonesian civil service and the determinants of civil service promotion. From the analysis, LSP found that female civil servants make up fewer than 28 percent of all echelon in national ministries, and experience substantially lower rates of promotion than men. The analysis is being used to inform the GoI’s major policy agendas related to merit-based and transparent promotions and more equitable distribution of civil servants. The World Bank governance team is also leveraging the results about gender disparities in civil service promotion to inform and better integrate gender into the proposed Human Resource Development for Bureaucratic Reform Operation. LSP, under the ECED pilot project, supported professional ECED teacher training for 15,491 village teachers of which about 98 to 99 percent were women. By designing the system to provide training at the sub-district level, many more women with family responsibilities could join the training program and improve their ECED skills. This helped enhance the status of these women as ECED teachers in village communities. The training also provided the mainly female participants with the means to earn a modest income from their teaching activities as many villages are increasingly allocating budgets to pay village ECED teachers (and posyandu cadres) an honorarium in line with village 34 MoV regulation on Penetapan Prioritas Peng- gunaan Dana Desa Tahun 2018 (Nomor 19/2017) regulations and the MoV Regulation on the Priority Use of Village Funds in 2018 states that Dana Desa can be used to provide in- (No. 19/2017).34 centive assistance for ECED teachers. 43 GEND ER & S OCIAL INCLU S I ON 2. Improving the quality of national spending by promoting gender equality Box 14. and women’s empowerment. In May 2017, LSP, in response to a request from the GoI, prepared a policy brief for MoF on Closing the Gender Gap: LSP’s Gender Equality Translating the Budget into Improved Gender Outcomes. Leveraging findings and Social Inclusion from previous LSP and World Bank-supported analysis (such as the BKN civil service analysis), the policy brief outlined key statistics on gender Strategy and inequalities; proposed potential activities that MoF could finance to increase Approach female labor force employment and improve women’s health and nutrition in 2018; and proposed a MoF-led program “Using the Budget to Improve LSP’s strategy for gender equality is Gender Outcomes”. MoF incorporated key elements from the World Bank’s underpinned by the World Bank’s In- policy brief into the GoI’s Macroeconomic Fiscal Framework, including a donesia Country Gender Action Plan commitment to increasingly strive to implement gender budgeting programs (CGAP) which supports the GoI to address high maternal mortality rate; so that women face less barriers to economic opportunities and improved low female labor force participation access to health care programs.35 The GoI will use the framework to inform and high gender wage gap; low lev- its 2018 national budget planning so it better supports gender equality and els of women’s participation in public women’s empowerment. decision-making processes; and legal restrictions that discriminate against 3. Improving nutritional care for mothers and infants: Continuing its work from women. the previous year, in 2017 Generasi focused on reducing malnutrition among To operationalize the CGAP strate- mothers and infants by providing community block grants and facilitators trained gy, LSP, like the GoA, adopts a twin- in health issues. These community block grants were tied to each community’s track approach, which supports: (1) achievements in improving maternal health and infant nutrition indicators projects that directly address gender (e.g. through monthly infant weighing sessions, the distribution of vitamin inequalities; and (2) projects that in- supplements and participation in nutrition classes. As Generasi approaches tegrate gender across all activities. completion at the end of 2018, the project’s experience in engaging mothers In terms of gender specific programs, and infants to utilize the posyandus will be leveraged. Its lessons learned will the LSP Generasi supported the GoI continue to influence the upcoming INEY operation, which supports the GoI’s to address and improve low rates of new National Action Plan to address stunting. service utilization among pregnant women and new mothers in Genera- 4. Support in reducing risks of maternal mortality: LSP continued to support si’s target areas. LSP also integrated Generasi, which aims to meet the health and education needs of women and gender and social inclusion across all children. Generasi supported the GoI to address low rates of service utilization its programs and activities by: among expectant and new mothers, and poor quality maternal and infant health • Undertaking gender specific services by providing conditional grants directly to community members and analyses, such as the Sentinel Vil- facilitators trained in health and nutritional issues.36 In 2017, LSP monitoring lage Study and BKN Civil Service data indicated that Generasi contributed to improvements in pregnant Analysis; women’s access to prenatal care visits and facility or trained professionals • Ensuring strengthened gender during births (see Chapter 5.2).37 The Generasi L/T IE, which is a unique nine- equality and more inclusive ele- year, randomized control trial involving over 90,000 respondents, found that ments are incorporated into gov- ernment and other development Generasi has continued to mobilize women to attend the posyandus for infant- partners’ activities and regulations, weighing sessions and pre-natal and maternal classes. In the poorest areas, including Permendagri LKD and Generasi showed a positive impact on Vitamin A and immunization uptake. LAD; • Ensuring adequate representation of 5. Understanding constraints to women participating in village-level decision- women in training, such as Gener- making: LSP published the baseline report from the Sentinel Villages Study in asi Facilitator Refresher Training and 2017, providing the GoI with findings about women and marginalized groups’ teacher training in the ECED pilot project where 98 percent of partic- ipants were women. 35 The GoI’s 2018 Macroeconomic Fiscal Framework is available at: http://fiskal.depkeu.go.id/data/doc- LSP’s more detailed contributions to ument/kem/2018/kem_ppkf_2018/files/kem_ppkf_2018.pdf. In the GoI’s 2018 Macroeconomic Fiscal gender equality and social inclusion Framework, see Box 5 for a reference to gender-based budgeting. 36 Generasi supported dietary supplements for pregnant women, assisted births in facilities, improved are outlined in Chapter 7. access to pre-natal and post-natal care and transportation to assisted birth facilities 37 World Bank, 2017, Generasi Implementation Status and Results Report, 2017, http://documents.world- bank.org/curated/en/824701514430057516/pdf/Disclosable-Version-of-the-ISR-ID-TF-HEALTHY-AND- BRIGHT-GENERATION-GENERASI-P132585-Sequence-No-09.pdf C HA P T E R S EV E N 44 participation in village-level decision-making.38 The study revealed that women are less likely to attend village- and hamlet-level meetings than men. The study also found that both male and female village activists frequent and are engaged in discussions in MusDes and MusDus. The findings also found that female village activists were almost as engaged as their male counterparts during meetings, indicating that they could potentially help air the voices of their fellow female villagers. 6. Recognizing children with special needs: As part of the ECED pilot project, the training materials, which were used to train over 15,000 ECED teachers, included materials on inclusion of children with special needs. The module highlighted the importance on recognizing children with special needs as early as possible, as well as provided guidance on how to adjust the learning environment and to seek support through referral systems. 7. Supporting the recognition of traditional customary institutions and more inclusive governance structures: LSP supported the DG Village Government Oversight in MoHA, through facilitating various discussions and providing policy and legal advice, to draft Permendagri LKD and LAD. The Permendagri formally recognizes community and customary institutions and thus more diverse and inclusive village governance arrangements. Through LSP’s support, Permendagri on LKD and LAD also includes the strengthening of participation, gender equality and transparency, which helps ensure that customary institutions and governance structures better reflect the needs of communities. 38 https://localsolutionstopoverty.org/news/participation-ngada.html 45 CH AP TE R E I G HT Key Challenges, Lessons Learned & Risks CHAPTER 8.1 Key challenges and Lessons Learned 8.1.1 Fragmented coordination and varied levels of commitment among counterparts Coordination among LSP counterparts remained a key challenge in 2017. The success of LSP and its programs relies on a high level of coordination and buy- in across multiple actors and levels, including a range of GoI stakeholders at the national and local levels, development partners and community actors. At the national level, fragmented coordination and uneven levels of commitment limited LSP’s progress in some activities. Policy inconsistences and delays in issuing regulations; varying mandates, priorities and expectations; and a lack of clarity over roles and responsibilities created program planning and implementation delays on the ground. For example, improving sub-national government capacity to implement the Village Law more effectively requires a high degree of coordination and buy-in among multiple ministries. At the program level, coordination between the provincial and district levels was also a challenge. For example, in some Generasi locations the lack of a strong coordination mechanism resulted in siloed intervention approaches for planning, implementation, and monitoring and information management processes, which constrained the delivery and effectiveness of the program. During 2017, LSP prioritized promoting greater coordination at both the Facility and program levels. During the reporting period, LSP established a new Steering Committee with strong leadership from four Director Generals (DG) in Bappenas (DG Population and Employment, DG Human Development, DG Developing Financing, and DG Regional Development and Autonomy) and technical working groups with key GoI stakeholders. These new streamlined governance arrangements are expected to improve coordination, especially at the national level. The World Bank is also trying to improve horizontal coordination across government ministries at the national level on national development priorities, such as stunting and early 08 childhood education. For example, the new Program for Results (PforR) for INEY Operation will help the GoI implement its National Action Plan to address stunting, bringing together multiple government agencies at every level to deliver multiple sector inventions to reduce stunting. The PforR will also support a national coordination platform that LSP can utilize to further increase the effectiveness of its service delivery portfolio. The VIP, by utilizing LSP as a coordinating mechanism, was also successful in facilitating greater interaction between MoV and Bappenas on Village Law Implementation. KE Y C H A L L E N G ES, L E SSO N S L EA RN ED & RISK S 46 8.1.2 Partner in human resourcing and capacity building CHAPTER 8.2 Given that LSP works with multiple stakeholders and partners to implement its pro- grams, the capacity and resources of those partners affect the effectiveness of LSP Risks activities. In 2017, delays in appointing key civil servant appointments, and limited As part of LSP’s monitoring, the Facility capacity and resources of local partners to implement or scale up LSP-supported regularly tracks risks for all activities activities or recommended actions created delays and challenges. Furthermore, and programs, and provide semi-an- while the success of LSP-supported activities and pilot projects generated increas- nual updates to DFAT. In 2017, 111 risks ing demand from communities and local partners to expand them, it also created were recorded in LSP’s Activity Tracker additional strains on existing local resources, creating bottlenecks in scaling up Tool. Of those risks, 27 percent were and expanding quality programs. One example of this was seen in the ECED pilot medium risk, 73 percent low, and none project, where demand for training outstripped MoEC’s ability to train and deploy were high. The main risks recorded sub-district ECED teacher trainers. include: • Coordination among counterparts In 2017, LSP focused on building capacity of its counterparts and partners to enable and development partners/programs them to sustain LSP-supported activities, financing and structures beyond the life of (29 percent); the programs. For example, LSP dedicated surge capacity for VIP implementation • Human resourcing and capacity of and to support the Bappenas stunting boot camps. Where possible, LSP leverages GoI counterparts and partners (14 local partner resources to support and maximize capacity building activities. KIAT percent); Guru provided capacity building for national and district government officials, as well • Alignment with government priorities as community members and village cadres, so that by the end of the pilot program, (7 percent); and these stakeholders have improved capacity to sustain the activities independently. • Others, such as unexpected budget In addition, KIAT Guru received funding from the Research in Improving Systems in constraints, quality of data and pro- Education (RISE) and leveraged SMERU capacity to deliver the endline survey. curement issues (50 percent). 47 CH AP TE R E I G HT Identified Risk Likelihood Consequence Mitigation Strategy Alignment with government Rare Medium/High LSP activities are aligned with RPJMN 2015–2019. To priorities: Government maintain relevance and alignment with government priorities continue to change priorities, LSP continues to actively engage with the GoI overtime. If LSP does not re- and the GoA, the major donor to the MDTF, through var- main responsive and evolve ious mechanisms, including the LSP Steering Committee in line with the GoI and the and Technical Working Groups (see Box 1 Relevance for GoA priorities there is a risk further details). Given the upcoming elections, and the that the Facility will not be heightened risks associated with changing government relevant. priorities, LSP has programmed almost all of its uncom- mitted resources in 2017 and accelerated preparation for its new major initiatives, including INEY, while engag- ing key stakeholders at the highest levels of govern- ment to lock in implementation modalities and securing key decisions affecting the portfolio. Coordination among Possible Medium Coordination remains a key challenge and risk for LSP. counterparts and develop- To manage this risk, LSP prioritizes promoting greater ment partners/programs: coordination at both the Facility and program level (see Coordination issues amongst Chapter 8.1.1 for more detailed management responses). the LSP Facility counterparts could potentially prevent LSP Facility from capitalizing on counterparts’ synergies and collaboration. Human resourcing and Possible Medium As highlighted above, the capacity of Facility partners is capacity: Human resourcing one of LSP’s main concerns. LSP is facilitating capacity and capacity of partners in building of counterparts with training, missions, seminars GoI and elsewhere can affect and knowledge transfers from the experts (see Chapter the effectiveness of LSP. 8.1.2 for further details). FU T UR E DI R EC T I O N S 48 Future Directions 09 Going forward, LSP will focus on promoting greater sustainability of the policy framework, institutions and systems that guide village development and basic service delivery so that these programs continue to bear fruit long after LSP’s projects have ended. With LSP’s MDTF expected to close in June 2020, the Facility is ramping up efforts to help sustain LSP-supported GoI activities, financing and structures beyond June 2020, including through building the capacity of GoI counterparts and partners, and communicating and institutionalizing LSP lessons learned and good practices in GoI systems and programs (see Annex 3 for an update on LSP’s 2017 planned vs. actual activities). In 2018, key LSP priorities include: ● Improving the effectiveness of Village Law for village development and pov- erty reduction. LSP will focus on: ⊲ Continuing to shift the allocation of Dana Desa to poor villages that need it the most;39 ⊲ Driving village spending toward more pro-poor, productive investments and services; and strengthening participation, inclusion and transparency across the village development cycle; ⊲ Piloting a “public, private and people partnership” (P4) model of local econom- ic development (LED) that empowers village farm and non-farm entrepreneurs to aggregate and form productive alliances, using Dana Desa for productive investments and empowering female entrepreneurs; ⊲ Accelerating reforms to enable reliable reporting on village spending and out- puts; ⊲ Mobilizing districts to play a greater role in village capacity building and over- sight; ⊲ Supporting coordination and key agencies responsible for implementing the Village Law; ⊲ Prioritizing, testing and scaling up innovation reforms, through the VIP, to iden- tify and generate solutions to local development and service delivery chal- 39 Given that the Dana Desa Allocation is reviewed lenges; annually and the Dana Desa allocation is expected to increase, LSP will continue to work with the GoI ⊲ Developing a platform to manage innovation capture and building systematic and advocate for continuous formula refinements organizational knowledge sharing to ensure greater sustainability and uptake that improve the pro-poor impact of Dana Desa. In of approaches that optimize village spending; and 2018, LSP will continue to strengthen GoI’s capac- ity to assess the impact of the formula on poverty, ⊲ Testing alternative models and sources for facilitation to help deliver more inequality, and different types of villages (small, sustainable and demand-driven facilitation support to villages. large, Java and non-Java villages). 49 CH AP T E R NI NE ● Improving basic service delivery performance for better ● Producing high quality analytical work to inform GoI human development outcomes. LSP will focus on: policy, particularly with regards to village develop- ⊲ Informing potential KIAT Guru scale-ups through provid- ment, poverty reduction, basic service delivery and ing evidence-based policy recommendations (from KIAT gender equality. LSP will focus on: Guru’s IE) to MoEC about performance-based incen- ⊲ Leveraging information from the ongoing Sentinel tives and mechanisms to improve teacher service per- Villages Study to inform policy and regulations to en- hance the impact of Village Law implementation; formance, and to MoV about community participation in monitoring basic service delivery; ⊲ Providing capacity to MoV for village data management and analysis and infrastructure data collection; ⊲ Completing the ongoing ECED evaluation and using the ⊲ Preparing a baseline line survey for the LED pilot results to inform GoI, including LGs outside of the pilot project and complementary qualitative assessments areas, about opportunities and methodologies to in- focused on the pilot project’s three core design ele- crease the availability of more qualified early childhood ments: the public, private and people partnerships, the education teachers; village partnership investments, and the inclusion of ⊲ Integrating health and education spending into village women and market groups; budgets to improve villages’ use of Dana Desa for ⊲ Disseminating the results of the Generasi IE to policy health and education services in Generasi locations, makers and development practitioners to inform ser- and working with MoV to disseminate and apply lessons vice delivery interventions, particularly in the health from the Generasi-Village Law integration beyond Gen- and education sectors; erasi locations; ⊲ Implementing the KIAT Guru IE and ECED process ⊲ Providing operational, coordination, policy and techni- evaluation to generate evidence on the impact of community monitoring, performance-based incentives cal support to help the GoI implement its National Action and villages’ involvement in service provision on ser- Plan to reduce stunting; vice delivery outcomes in Indonesia to inform poten- ⊲ Supporting, in line with the National Action Plan, the tial scale-up projects and other operations across the rollout and implementation of the HDW pilot project in country; 3,105 villages across 31 stunting priority districts to help ⊲ Providing analysis of BKN data to the GoI to inform civil promote, incentivize and converge multi-sectoral village servant reforms related to merit-based and transparent efforts to reduce stunting; and promotions across Indonesia; and ⊲ Preparing the new GoI requested INEY Operation to ⊲ Working with Bappenas to conduct a study to analyze support the Presidential Action Plan to reduce stunting. factors that contribute to an enabling environment for sustainable livelihoods (including roles/concepts of “keperantaraan” (partnership/linkages with mar- ket and technical experts) to inform inputs for RPJMN 2020-2024. ANN E X E S 50 Annexes Annex 1: Theory of Change 2017 BOARDER Enabling citizens, villages, local governments as well as the private sector to identify and implement GOALS local solutions to reduce poverty and inequality in Indonesia Improved pro poor, inclusive, community driven, and impactful local development at village level LINE OF CONTRIBUTION END OF PRINCIPLES FACILITY OUTCOMES 1 2 3 Local governments become Beneficiaries receive improved National & Local Governments more responsive & inclusive basic service delivery better use fiscal resources INTERMEDIATE • Strengthened local framework • Beneficiaries experience • Strengthened national framework OUTCOMES and system to improve increased equity of access to and systems for tracking village Government governance and downward services finances and outputs partnership and accountability to communities • Beneficiaries increasingly utilize • Pilot villages demonstrate finance ownership • Communities have more services allocation that is equitable, needs e ective and structured • Beneficiaries have improved based and pro-poor participation at village-level quality of education and health • Village communities and Community • Local governments have services government have improved engagement and development plans and capacity to manage increased accountability budget that better reflect finances community needs, including • Data-driven planning and women and poor people budgeting at local level is Evidence-based strengthened LINE OF CONTRIBUTION Inclusive and bottom-up process IMMEDIATE • Communities increasingly • Beneficiaries have improved • National government establishes involved in village development access to health services in regulation on more pro-poor OUTCOMES Integrity process (plan, budget, targeted areas Dana Desa allocation implementation and M&E) • Beneficiaries are utilizing more • Improved national and district including women & poor people health services in targeted areas government capacity support for • Good practices, lessons and • Nutrition services are improved in villages to use funds e ectively RISKS challenges are shared among target areas (plan, budget, implemet, report, villagers • Local governments expand oversee) • District & village government are relevant stunting prevention and • Targeted villages have better more capable to manage village mitigation programs in targeted village fund allocation that meet development process (planning, areas community’s needs budgeting, implementation, M&E) • Teachers from rural/remote areas • Pilot districts and villages • Villagers have increased are better trained in target areas increasingly use data for planning, awareness of village develop- • Beneficiaries have improved budgeting and M&E ment plans and budget access to trained teachers from • National & local governments Coordination among • Villages with quality technical rual/remote areas e ectively disperse special counterparts and implementation plans • Teachers attendance and service teachers allowances development performance increases in target • Beneficiaries are increasingly areas satisfied that village plans and partners / programs investments meet their need and development priorities Knowledge sharing platform and mechanism PROGRAM • Data for Results • Early Childhood Education and • Data for Results • Early Childhood Education and Development • Early Childhood Education and ACTIVITIES Human resourcing Development • Generasi Development • Generasi • Investing in Nutrition and Early • Generasi and capacity • KIAT Guru Years • Investing in Nutrition and Early • MELAYANI • KIAT Guru Years • Village Law PASA • Village Innovation Program • KIAT Guru Alignment with • Local Economic Development government • MELAYANI priorities • Village Law PASA 51 ANNE X E S Annex 2: Financial Overview Pledges and Contributions As of December 31, 2017, donors have pledged US$354 million and paid in US$351 million to the MDTF. TABLE 1 Pledges and contributions from 2008 to 2017 YEAR CUMULATIVE PLEDGE (US$) CUMULATIVE PAID-IN (US$) 2008 58,624,324 22,952,786 2009 67,391,804 40,758,459 2010 91,192,810 66,405,643 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 201640 354,205,520 334,309,354 2017 354,205,520 350,976,945 40 The Netherlands pledged US$37 million but only contributed US$32 million before withdrawing from the MDTF. ANN E X E S 52 TABLE 2 Financial Status Summary DESCRIPTION Contributions Pledged Received LSP - MDTF (TF070967) 354,205,520 350,976,945 Government of Netherlands (exited out of the MDTF on June 30, 2013) 31,899,970 31,899,970 Government of Australia 203,161,050 203,161,050 Government of Denmark (exited out of the MDTF on June 30, 2014) 15,120,164 15,120,164 Government of United Kingdom (exited out of the MDTF on June 30, 2013) 7,934,430 7,934,430 European Union (exited out of the MDTF on June 30, 2014) 6,604,906 6,604,906 Millennium Challenge Account-Indonesia 89,485,000 86,256,425 Investment Income 3,373,326 Transfer to other funds (PAMSIMAS) (10,377,650) Other receipts 3,595 Total Contributions, Investment Income, Transfer to other funds and Other Receipts 354,205,520 343,976,209 Approved Projects Approved Disbursed Executed by Government of Indonesia 222,381,615 216,635,747 Non-Governmental Organization 22,314,103 20,631,846 World Bank 77,135,185 69,475,777 Total Approved Project 321,830,902 306,743,370 Administrative Cost Recovery Program Management and Overheads 13,805,573 8,604,261 Admin Fee (1% of Contributions) 3,509,769 3,509,769 Total Administrative Cost Recovery 17,315,342 12,114,030 Grand Total Approved Project and Administrative Cost Recovery 339,146,245 318,857,400 EXECUTION Disbursement Funds are executed by the GoI, NGOs, and the World Bank. As of the end of 2017, the MDTF had cumulatively disbursed a A major of the funds, 69 percent, are executed by the GoI, total of US$315 million.41 In 2017, the MDTF disbursed US$29 followed by the World Bank, and NGOs. million. FIGURE 7 FIGURE 8 Share of funds contributed to LSP MDTF Disbursement History in 2017 TOTA L D I S B U R S E M E N T (U S $ M I L L I O N ) 24% 315.3 69 % 252.7 286.2 222.2 7 % 181.2 125.8 80.5 36.2 1.8 8.5 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Government NGO WB 41 This amount excludes the administration fee of 1 percent, which was deducted by the World Bank headquarters from the donors’ paid-in contribution. As of December 31, 2017, the total administration fee was US$3,509,769. 53 ANNE X E S TABLE 3 Program Expenditures by Executing Agency (US$) GOVERNMENT OF INDONESIA (GoI) APPROVED ACTIVITY CLOSING STATUS GRANT AMOUNT DISBURSEMENT CUMULATIVE DATE (US$) 2017 (US$) DISBURSEMENT AS OF DEC 31, 2017 (US$) National Program for Commu- 31 Dec 18 Active 121,772,086 17,076,000 116,026,218 nity Empowerment in Rural Areas Healthy and Bright Generation (Generasi Sehat Cerdas) Settlement Rehabilitation 31 Dec 13 Closed 399,645 - 399,645 and Reconstruction Project (Rekompak) PNPM Urban III - Disaster 31 Dec 12 Closed 1,344,209 - 1,344,209 Management Support ID-TF PNPM Generasi (Com- 31 Dec 14 Closed 67,236,714 - 67,236,714 munity CCT) Scale-Up Cofinancing Grant to PNPM 31 Dec 12 Closed 30,682,561 - 30,682,561 for Decentralized Manage- ment of Natural Resources and Renewable Energy Integrated Management Infor- 30 Nov 14 Closed 946,381 - 946,381 mation System (MIS) for PNPM Mandiri - SIMPADU (Phase 2) Project PNPM Village Training Pro- 31 Dec 15 Closed 20 - 20 gram Project TOTAL 222,381,615 17,076,000 216,635,747 NGO APPROVED ACTIVITY CLOSING STATUS GRANT AMOUNT DISBURSEMENT CUMULATIVE DATE (US$) 2017 (US$) DISBURSEMENT AS OF DEC 31, 2017 (US$) KIAT Guru Implementation 29 Jun 18 Active 4,987,000 2,444,471 3,304,743 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 30 Jun 13 Closed 265,000 - 265,000 Raising Project in Sumatera ID-TF PNPM Community Facili- 31 May 10 Closed 945,000 - 945,000 tator Development Program Support Facility for the National 31 Dec 12 Closed 2,295,400 - 2,295,400 Program for Community De- velopment/Program Nasional Pemberdayaan Masyarakat (PNPM), Environmental Pilot Project - 'Green' PNPM ANN E X E S 54 TABLE 2 - NGO (CONTINUED) APPROVED ACTIVITY CLOSING STATUS GRANT AMOUNT DISBURSEMENT CUMULATIVE DATE (US$) 2017 (US$) DISBURSEMENT AS OF DEC 31, 2017 (US$) ID-TF PNPM Peduli Executing 31 Dec 13 Closed 2,365,047 - 2,365,047 Organization: Association for Community Empowerment PNPM Peduli Executing Orga- 30 Nov 14 Closed 2,028,063 - 2,028,063 nization: Lakpesdam Project ID-TF PNPM Peduli Executing 30 Nov 14 Closed 3,835,078 - 3,835,078 Organization: Kemitraan TOTAL 22,314,103 2,444,471 20,631,846 WORLD BANK APPROVED ACTIVITY CLOSING STATUS GRANT AMOUNT DISBURSEMENT CUMULATIVE DATE (US$) 2017 (US$) DISBURSEMENT AS OF DEC 31, 2017 (US$) ID-TF VIP Supervision and 30 Apr 19 Active 8,796,270 792,546 8,455,181 Monitoring ID-TF M&E and Special Studies 31 Dec 19 Active 12,841,000 329,877 11,962,535 ID-TF Generasi Sehat Cerdas 30 Jun 18 Active 8,164,899 895,700 7,492,800 (Community CCT) Pilot Program KIAT Guru Supervision and 30 Jun 19 Active 315,000 103,132 183,872 Monitoring KIAT Guru - Improving Teacher 31 Dec 19 Active 785,000 671,994 746,719 Performance and Accountability Development Challenge 28 Feb 18 Active 1,555,820 529,795 552,843 Nudges & Community-based Nudges42 Village Law PASA - Gover- 31 Dec 18 Active 1,700,000 476,531 920,976 nance Sub-tasks Village Law PASA Program 31 Mar 20 Active 4,150,000 1,242,291 3,296,792 Enhancing Technical Skills for 31 Dec 19 Active 300,000 47,767 49,770 Poverty Analysis42 Indonesia Urban Poverty 31 Dec 19 Active 907,230 336,944 398,411 Assessment42 Impact Evaluation of PNPM 31 May 18 Active 2,018,194 901,412 1,828,273 Generasi M&E and Accountability Tools/ 31 Dec 19 Active 300,000 88,031 88,031 Diagnostics Collaborative District Problem 28 Feb 19 Active 400,000 272,613 335,696 Solving Improving Data to Deliver 31 Dec 19 Active 750,000 62,614 63,644 Results in Service Delivery Youth & Female Unemploy- 31 Dec 19 Active 246,236 129,514 140,243 ment in Indonesia42 42 There are four bank executed trust funds that are managed under the Partnership for Knowledge-based Poverty Reduction (PKPR) including (i) Development Challenge Nudges & Community-based nudges; (ii) Enhancing Technical Skills for Poverty Analysis; (iii) Indonesia Urban Poverty Assessment; and (iv) Youth and Female Unemployment in Indonesia. These projects are reported under PKPR 55 ANNE X E S TABLE 02 - WORLD BANK (CONTINUED) APPROVED ACTIVITY CLOSING STATUS GRANT AMOUNT DISBURSEMENT CUMULATIVE DATE (US$) 2017 (US$) DISBURSEMENT AS OF DEC 31, 2017 (US$) ECED Frontline - Training En- 30 Jun 18 Active 1,650,000 796,682 1,372,370 hancement and Dissemination ECED Frontline - Evaluation 31-Dec-19 Active 1,200,000 532,087 532,087 Susenas Consumption Exper- 31 Dec 16 Closed 137,459 - 137,459 iment ID-TF PNPM Communication 24 Nov 15 Closed 4,317,811 - 4,317,811 Strategy Village Training Program 31 Dec 15 Closed 393,621 - 393,621 National Program for Com- 31 Mar 15 Closed 4,099,916 - 4,099,916 munity Empowerment (PNPM) Field Operations ID-TF PNPM Supervision and 31 Dec 12 Closed 788,030 - 788,030 Monitoring (Urban) Training of Local Auditor (Ins- 31 Oct 11 Closed 288,031 - 288,031 pektorat Kota/Kabupaten) in PNPM Mandiri Perkotaan Barefoot Engineers Training III 31 Dec 14 Closed 68,032 - 68,032 Technical Assistance and Sup- 31 Mar 15 Closed 2,987,615 - 2,987,615 port to Bappenas and Kemen- ko Kesra (Pokja Pengendali PNPM Mandiri) ID-TF PNPM WINDOW 3 31 Aug 11 Closed 166,816 - 166,816 PHASE I National Program for Com- 31 Dec 15 Closed 1,458,948 - 1,458,948 munity Empowerment (PNPM) Window 3 - PNPM Peduli Phase II PNPM Disabled Persons 31 Dec 15 Closed 576,640 - 576,640 Organisations Window Program ID-TF Local Government 30 Jun 13 Closed 1,717,026 - 1,717,026 Capacity 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 28 Feb 13 Closed 633,374 - 633,374 Analysis, Program Review and PNPM-Urban Evaluation Co-financing Grant to PNPM 30 Dec 13 Closed 730,400 - 730,400 for Decentralized Manage- ment of Natural Resources and Renewable Energy PNPM: Poverty Engagement, 30 Jul 12 Closed 1,999,785 - 1,999,785 Knowledge and Action TOTAL 77,135,184 8,209,528 69,475,778 ANN E X E S 56 Annex 3: Activity Implementation Summary (Planned vs Actual Activities) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status ECED Community participation Villages nominate ECED 2,674 villages from 25 Fully met. All villages Completed in planning and orga- teachers in training districts nominated 3 nominated three ECED nizing training for ECED package, UPKs organize participants and verified teachers. Exceeded. teachers. training according to by Camat, UPKs organize 7,991 village teachers manual issued by MoV training. participate in training (2017). package in 2017. Process evaluation on Regular district monitor- Bottlenecks and good Bottlenecks from 2016 Completed implementation of train- ing and TA during the practices are identified. implementation are ing using district-based preparation and imple- identified and used to community-focused mentation of training. improve 2017 implemen- system. tation. Case studies on sustain- Case study in six districts. Report on likelihood Three case studies Ongoing ability and scalability. of sustainability and have been completed scalability. with three more still in process. Develop training mech- Conduct District Assess- District-based commu- All target teachers are Completed anism that links Com- ment and provide TA nity-focused training trained using district munity Training Fund to link district training system is established in based community-focus (demand), district trainers stakeholders. 25 districts. training system in 2017. and training modules from MoEC. Develop enhanced train- Enhanced training Enhanced training ma- Enhanced resources are Completed ing resources adapted materials introduced to terials is used by all 25 used in 25 districts. to village context and trainers from remaining district trainers in training introduce them to 25 15 districts in 2017. ECED village teachers districts. (2017). Develop training mech- Conduct district assess- District-based community All target teachers Completed anism that links Com- ment and provide TA focused training system are trained using munity Training Fund to link district training is established in 25 district-based commu- (demand), district trainers stakeholders. districts. nity-focused training and training modules system in 2017. from MoEC. Generasi Continue to support Sub-project activities on 1) All Generasi villages The new 2017 monitor- Ongoing Generasi community mother-child health and achieve minimum target ing indicators will be grants for: 1) sub-proj- primary education. health and education measured in November ect activities in 3 new indicators, 2) Project 2017 (6 months) and May provinces, 2) community Development Objec- 2018 (12 months) after capacity building tive/Result framework Generasi concept for achieved. 2018 changed. Community capacity 1) All generasi villages Report for integration in Completed building on integration (government and com- NTB with 411 data sample Generasi and implemen- munity) trained about of APBDes 2016-17. tation of the Village Law. integration Generasi im- Tracking AAPBDes 2016- plementation with village 2017 for all Generasi law, 2) Villages allocated Area collected 4,277 vil- health and education on lages sample from a total village budget (APBDes). of 5,789 villages. 57 ANNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Generasi Continue to support the Training for Generasi All Generasi facilitators All 38,314 (51% female Completed provision of district and village actors given refresher training. and 49% male) Generasi sub-district facilitators village actors (local facili- including operational tators, village officer, and support. health and education cadres) in 11 provinces were trained, together with the training for 564 Posyandu staff. Facilitation on prepara- All Generasi district loca- In 2017, eight regulations Completed tion of district policy. tions support and make produced to support regulations to allocated health and education. health and education activities from village budget (APBDes). Data collection of Gener- 1) Generasi data monitor- 1) Tracking APBDes Completed asi monitoring indicators ing/PDO completed and collected 4,277 village and tracking of APBDes submit from all villages, samples from a total of spending on health and 2) all facilitators submit 5,789 villages; and 2) education. data on tracking APBDes PDO 97% will be uses in spending on health and ISR December 2017. education. Provision of the national Complaints-handling All Generasi locations 1) As at September 2017, Completed and provincial project system (CHS). reported on the com- Complaint recorded in consultant and technical plaints-handling system system: 205 complaints, assistants. Training pack- (CHS). 183 solved. age for facilitators and Internal audit. 1) Achieve minimum As at September 2017, Completed printing-publication. target for internal audit 277 sub districts, 463 by consultants and villages had undergone facilitators, 2) target 66 internal audits (by consul- district, 499 sub-districts, tants and facilitators). and 2,034 village audits. Village Innovation Activity completed Completed Festival Generasi extension for Concept design for Gen- Final concept note Activity completed Completed 2018 erasi's extension in 2018. design for Generasi’s extension in 2018. KIAT Relevant GoI regulations Relevant GoI regulations Issuance of relevant GoI All relevant GoI regula- Ongoing Guru issued. issued. regulations at national, tions for 2017 had been district, and village levels issued by April 2017. to enable implemen- These regulations need tation of community to be extended for 2018. empowerment and pay National Coordination for performance mech- Team (a.k.a. KIAT Guru anisms. Key regulations Steering Committee) and include: MoU between five district governments MoEC and Head of Dis- have agreed to extend trict of pilot districts, tech- the regulations for 2018. nical guidelines, Head of Formal letters have been District regulations, Head sent, which will trigger of Education Department the process. decree, Head of Village decree. ANN E X E S 58 aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status KIAT Training and on-the-job Training and on-the-job Number of village cadre On-going training and Ongoing Guru capacity development capacity development and school-user com- on-the-job capacity for village cadre and for village cadre and mittee members able to development for village school-user committee school-user committee hold teachers account- cadre and school-user members to hold teach- members to hold teach- able. committee members to ers accountable. ers accountable. hold teachers account- able. There were 2,030 persons in total as at December 2017. On-going technical in- On-going technical in- Quality assurance of Work program and Ongoing puts and implementation puts and implementation work plan, implementa- implementation reports supports to the imple- supports to the imple- tion (including fiduciary), through to Septem- menting agency. menting agency. and report. ber 2017 have been approved by the national government, to be disseminated to district governments. Community score card Community score card Community score card This phase has been Completed agreed. agreed. agreed by provider completed in all partici- groups (teacher and prin- pating villages per end of cipals) and user groups September 2017. (parents and community representatives)., Tunjangan Khusus (TK) Tunjangan Khusus Tunjangan Khusus for The first quarterly pay- Ongoing allowance for teachers allowance for teachers teachers in Treatment ment has been made assigned to PPM models assigned to PPM models Group 1 are paid based in July 2017. The rest are paid according to are paid according to on teacher presence, of the payments will be KIAT Guru formula. KIAT Guru formula and in Treatment Group conducted in October 2 are paid based on and December 2017, and teacher service perfor- April and July 2018. Sec- mance. ond quarterly payment is at 94% as at November 2017. Meetings and workshops Meetings and workshops Number of GoI officials On-going meetings Ongoing to draft regulations, to draft regulations, involved in project imple- and workshops to strengthen capacity and strengthen capacity and mentation. strengthen capacity, and understanding of the understanding of the understanding of the KIAT Guru mechanisms, KIAT Guru mechanisms, KIAT Guru mechanisms, and ownership by GoI and ownership by GoI and ownership by GoI officials. officials. officials. There were 447 persons in total as at December 2017. On-going technical On-going technical Intervention design and Intervention design has Ongoing inputs to the national inputs to the national project sustainability been approved, on-go- government officials. government officials. approved by the GoI. ing discussion on project sustainability. 59 ANNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status KIAT Village monthly meetings Village monthly meetings School-user commit- All participating schools Ongoing Guru conducted conducted tees present evalua- conducted month- tion scores along with ly meetings, by end supporting evidence to January 2018. Going provider groups, village forward, meetings will be facilitated by village government repre- cadres. The roles of sentatives, and wider project facilitators will communities switch to strengthening institutionalization and sustainability of activities by local stakeholders. Only 25% conducted by end of November There were 1,752 meetings as at Decem- ber 2017. The figure is expected to increase, as 57 schools deferred their December 2017 meeting to January 2018. End-of-semester village End-of-semester village Meeting at the end of This meeting has Ongoing meetings conducted. meetings conducted. school semester to been conducted in 173 evaluate service agree- schools, with plan to ments, community score complete it in all 203 cards, and school-user schools by the end of December 2018. Going committees. forward, village cadres will be trained by project facilitators so that they can independently facili- tate evaluation meetings. There were 187 meetings in total as of December 2017. Melayani Development of project Prepare methodology Methodology paper and Completed. Completed methodology, structure paper, consultation with project manual. and implementation GoI counterparts, devel- design. op project manual. Selection of locations. Consultations with other Shortlist of potential loca- Locations shortlisted and Completed development partners. tions, location assess- selected. ment reports. Hiring of managing con- Open bid procurement Managing consultant Managing consultant Completed sultant and coaches. of managing consultant, contracted and coaches contracted, coaches interviews and selection selected. contracted by managing of coaches. consultant. Coach training. Develop training curric- Training modules and Training modules Completed ulum and modules and training delivered. produced and training provision of training. delivered. Executive seminar for Executive seminar for Executive seminar deliv- Executive seminar Completed participating district gov- participating district gov- ered. attended by 40 partici- ernments. ernments. pants. Collection of baseline Collection of baseline Baseline report Coaches in process of Ongoing data data collecting baseline data Identification of priority Identification of priority List of priority problems. Coaches in process of Completed problems in service problems in service identifying district priority delivery. delivery. problems in service de- livery. ANN E X E S 60 aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Melayani Formation of prob- Formation of prob- District problem-solving Coaches in early stage Ongoing lem-solving team and lem-solving team and team established and of identifying potential problem analysis. problem analysis. Problem analysis con- team members district ducted priority problems in service delivery. Village Regulatory framework Revised Permendagri no. a. Input to finalize revised (1) Provision of two Completed Law for VFM 113/2014 Permendagri no. 113/2014 technical consultants PASA to support MoHA (DG Bina Pemdes) in the revision of Permendagri no. 113/2014 on VFM. The TA was used for two workshops and a series of in-depth consultations, and provided technical recommendations on the rationale and options for Permendagri no. 113/2014. 2) The World Bank team has provided inputs to Bina Pemdes, MoHA, on the revision of Per- mendagri no. 113/2014. The Bina Pemdes will take 90% of the input. MoHA included the team’s suggestion to a) separate econom- ic classification from “bidang” classification, b) change the financial report to a simpler form, and c) change the village balance sheet (Laporan Kekayaan Milik Desa) in the revision of Permend- agri no. 113/2014. Sug- gestions have also been discussed with local governments for input. It is expected that the revision of Permendagri no. 113/2014 will be more comprehensive than the current version. b. Working Papers on Preparation Village Financial Man- agement c. TA Socialization of the Preparation revised Permendagri no. 113/2014: 1. Tutorial/videographer (infographic) 2. Pocket Book 61 ANNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Village Regulatory framework TA for harmonization and TA report of harmoniza- Presentation and policy Completed Law for VFM. roll-out of BCS and COA. tion and roll-out of BCS input on the need to re- PASA and COA. view the village Budget Classification Structure and Chart of Accounts to make national statistical consolidation possible. Disbursement Write-up on main find- Findings report on dis- DD disbursement Completed ings of disbursement bursement survey. monitoring completed survey. and analysis report developed but the Write- up on main findings of disbursement survey is not finished Note: Initial key findings include: a) Delayed but improving transfer of DD from RKUN and RKUD; b) Need to improve the capacity of districts in budgeting and monitor- ing realization of funds; and c) Lack of capacity of district/sub-district officials in evaluating DD realization reports. Improved VL regulatory TA for Permendagri 1. TA for Permendagri WB task team provided Completed framework for village de- on Village Community on Village Community technical assistance, velopment for inclusion Institutions and Village Institutions and Village advice to MoHA by con- and participation. Customary Institutions. Customary Institutions. ducting Panel Discussion to gather recommenda- tion and policy input for the Daftar Inventarisasi Masalah (DIM) or list of problems inventory, which was used as input for the draft regulation; conducted joint mission for capturing the facts/ evidence from the field; Workshops, FGDs, Na- tional Public Consultation and Finalization Work- shop to gather input, pol- icy advice and direction for the development of the MoHA Regulation on Village Community Institutions and Custom- ary Institutions. The Minister of MoHA is Delayed reviewing the regulation of Village Community Institutions and Village Customary Institutions 2. Evidence based Preparation legislative drafting and Regulatory Impact Assessment Training for MoV and MoHA staff ANN E X E S 62 aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Village 3. Socialization and Guid- Preparation Law ance development/tem- PASA plate of local regulation on LKD and LAD Improved VL Facilitation 1. TA to do stocktaking TA Report on stocktak- Preparation and Capacity Support and review status of ing and review status of inclusion and representa- inclusion and representa- tion of vulnerable groups tion of vulnerable groups in VL implementation (in in VL implementation. village facilitation and capacity building). 2. Review/evaluate and Evaluation Report on the Preparation testing the use of nation- use of national module al module of technical of technical supervisor of supervisor of village village government and government and BPD BPD (in two provinces, (in two provinces, four four districts). districts). National and Sub-nation- 1. Preparation to design Final report on design TA Preparation al support to improve TA and operational and operational support village capacity support for MoHA on for MoHA on capacity capacity building and building and system system strengthening. strengthening. Preparation 2. Assessment of MoHA/ Assessment Report of LG support for village MoHA/LG support for capacity village capacity Village public expendi- Complete ViPER analysis ViPER analysis report The Bank has devel- Ongoing ture review (ViPER). based on representative and findings oped a framework for a sample nationally representative sample and system to categorize, code, enter, analyze and report on village revenue expen- diture. The Bank has completed the data entry of 4,410 documents (planned APBDes 2015, revised APBDes 2015, Realization Report 2015 and planned APBDes 2016). The World Bank is still collecting docu- ments from 14 districts to complete a nationally representative sample. This will happen in partnership with Bina Pemdes, MoHA. Policy note and pre- (1) Presentation to Ongoing sentation, workshop, Directorate Financing dissemination. and Transfer of Non-Fis- cal Balance, Director- ate General of Fiscal Balance, MOF on VIPER findings based on 3,200 APBDes. (2) Planned sub-national workshop, with Bina Pemdes on ViPER. 63 ANNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Village Costing of Village Infra- Report on Costing of This sub-activity will be Preparation Law structure Village Infrastructure implemented under PASA ViPER. Build capacity of MoHA MoHA capacity to Presentation of ViPER Ongoing to undertake ViPER undertake VIPER reviews undertaken at MoHA. reviews. improved Joint Binteks to be con- ducted with villages in November 2018. Village Fund Allocation Pro-poor options for Dana Desa allocation DG Fiscal Balance, MoF Completed Dana Desa allocation options produced and and Parliament approved shared DJPK. adopted. the revision to Dana Desa formula taking into account World Bank suggestions. From 90% basic allocation/10% formula to 77%/20% with 3% allocation for very lagging villages and underdeveloped villages that have a large number of poor people. Formula adjusted to more heavily weigh poor population. Finalization of working Working papers on As a follow up on Ongoing papers on changes changes for a more theDana Desa 2018 for a more equitable equitable Dana DesaAl- formula, team is pre- Dana Desa Allocation location Formula. paring working paper Formula. on changes for a more equitable Dana Desa Allocation formula. Village governance Village transparency and a. Mission reports a. Conducted spot Completed activities anti-corruption efforts checks in six provinces, 12 districts, 27 sub-dis- tricts and 64 villages with MoHA-Bina Pemdes, Mo- HA-IG, MoV- Directorate of Village Development and Village Community Empowerment, MoV-IG b. Input to the revi- b. Supported MoHA Ongoing sion of Permendagri Bina Pemdes to con- No.113/2014 and the duct workshops inviting Action Plan on Corrup- related stakeholders tion Prevention at the to discuss and obtain Village Level input to formulate the design of mitigation mechanisms and handling deviations in the implementation of Village Budget. South-South Knowledge Lesson learned, Back 1. Completed the SSKE Completed Exchange for Indonesia to Office Report (BTOR), India by inviting five (SSKE): "Village Gover- Inputs for GoI policies/ ministries, two from local nance (including Social regulations/system. governments. Accountability) and Inclu- sive Livelihood Model in 2. Have a half day work- India," New Delhi, West shop follow-up on SSKE Bengal and Tamil Nadu to gather inputs and lesson learned as well (28 Jan - 04 Feb 2017). as action plan from each ministry. ANN E X E S 64 aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Village FGD on Monitoring and Key points related to the FGD on Monitoring and Completed Law Oversight of Dana Desa. legal basis of authority, Oversight of Dana Desa PASA the capacity of the DG of in relation to Village Law Bina Pemdes (particu- Implementation. larly) and the MoHA in monitoring and oversight of Dana Desa to realize better Village Gover- nance (MoM/Minutes of Workshop). VFM systems support TA to enhance Village Report on Village Asset Preparation (Siskeudes and OM- Asset Management Management SPAN) TA to strengthen Village TA Report Ongoing Financial and Output re- porting links to OMSPAN TA to enhance (1) Technical review note Technical guidance on Ongoing Siskeudes application, and recommendation Siskeudes New Release curriculum, plan. note as a consolidation application to several of findings from Sis- provinces to try out the keudes. These outputs Siskeudes New Release included options for vil- application based on lage facilitators, sub-dis-PMK No. 50/2017. Joint trict officers and local with MoHA and BPKP champions to support to conduct a Bintek and implementation roll-out. try out of the Siskeudes New Release Update in (2) Provided technical two districts (Tegal and input for the training Magelang), as well as modules of FM and conduct joint mission Siskeudes. with (MoHA, BPKP and (3) Designing plan for the MoF) to review the prog- pilot of new release of ress of the implementa- Siskeudes applications in tion of Siskeudes New five districts. Release tested in Tegal previously (M&E activity), as well as to review the interconnection between the Siskeudes and OM SPAN system. VIP Project restructuring and Developed operation VIP Project Operation MoV issued a Ministerial Completed VIP Preparation manual and SOPs to Manuals, SOP for Village Decree on the Project implement the project. Innovation Grants (VIG), Operation Manual and SOP for Technical Ser- its technical guidelines, vice Provider (TSP), SOP which was signed on Stakeholders relationship September 8, 2017. (HAP), Guidelines De- velopment Information System, SOP Activity Op- erational Funds (DOK). Finalization VIP training Finalization VIP training First draft of acceleration Ongoing Modules modules and regular VIP training modules have been developed. Village Innovation As a guideline to imple- Activity completed. Completed Exchange Pilot (Pi- ment Village Innovation lot Bursa Inovasi) in Exchange in every dis- Magelang-Central Java trict (video, manual). 65 A NNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status VIP VIP launch. Soft launching of VIP has Activity completed. Completed implemented in Decem- ber 2017 in Halmahera Utara Village and Technical Ca- TSP Mapping Mission, List of TSPs in three Guidelines to conduct Ongoing pacity Building--Technical TSP Training in Needs areas: entrepreneurship, TSP training at the Service Provider (TSP) Assessment. Workshop infrastructure and human provincial level has been (IBRD Loan) for finalizing modules development, about developed. The training and Grant Master Train- 2,604 TSPs will receive for TSPs will only be de- ers (GMT), TOT, Training. capacity-building training livered in the next fiscal year, i.e., 2018. Village Innovation Grant Providing learning Video and books on Activity completed. Completed and Knowledge Sharing documents. Innovation. (IBRD Loan) Implementation Support Developing training mod- Training modules for VIP Completed. The Completed and Technical Assistance ules for VIP (acceleration acceleration, training modules have been (IBRD Loan) and regular) for P3MD modules for VIP regular. distributed to the training facilitators (accelera- participants at provincial tion) and VIP facilitators and district levels. (regular). VIP Grant Master 9 GMT and 25 MT are Completed. Completed Trainers (acceleration), well trained and ready VIP Training of trainers to train the trainers, 174 (acceleration), VIP accel- trainers are ready to train eration training for P3MD the P3MD facilitators, facilitators. 1,736 P3MD facilitators are trained. Recruitment and mobili- A total of 2,719 VIP facili- 95% of TA-VIP at the Ongoing zation of VIP Consultant tators at central, province central level and 90% of a district level and district levels were TA-VIP at the provincial recruited and mobilized. level are in place. Final TOR and recruitment guidelines for TA-VIP at districts was submitted by MoV for the Bank's No Objection Letter in October 2017. Village and technical ca- Developing SOP and SOP and TOR are avail- Activity completed. Completed pacity building --Village TOR. able. Data Management. (IBRD Improvement on Village SIPD can provide Several discussions Delayed Loan) Development Informa- information on village have been conducted tion System (SIPD). development. with MoV. This activity is delayed due to recruit- ment of Data Officer and capacity Building to MoV Pusdatin Staff are not yet implemented VIP training monitoring VIP training monitoring BTOR Activity completed. Completed at the provincial level at the provincial level (participants from P3MD (participants from P3MD facilitators) facilitators) Monitoring TSP training Monitoring TSP training BTOR SMO for monitoring TSP Preparation training needs to be developed Monitoring Village Inno- BTOR BTOR of Bursa Inovasi Activity completed. Completed vation Exchange at the Desa. district level ANN E X E S 66 aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status Evaluations and Special Studies Generasi Generasi Impact Analysis of results Additional analysis using Ongoing Evaluations MIS data and APBdes. Village Sentinel Villages Study Presentation of results PPT, case study report, Seven out of 8 pre- Ongoing Law (BBLs), case study 1: revised questionnaires, sentation delivered, 9 PASA village fund utilization, workplan, website and questionnaires revised, case study; Facilitation, reports/papers, end line questionnaires tested Workshop for prepara- study report in Kabupaten Bojone- tion of end line survey; goro, Website can be Publications and dissem- accessed: https://localso- inations; and end line lutionstopoverty.org data collection. Analytics M&E and Accountability Data analysis Analysis results Additional information Ongoing Tools (Civil Service Data is being collected to Analysis) support the analysis. VIP evaluation 1. Developing concept Concept note/TOR Draft of TOR has been Ongoing note/TOR done and consulted, finalization of TOR in January. 2. Developing question- Questionnaires Some question has been Ongoing naires tested in Kabupaten Bojonegoro. 3. Baseline data collec- Field data Started in February 2018. Preparation tion Rural Poverty Analysis Literature review to TOR Consultant hired. Ongoing prepare TOR Improving data to deliver Presentation from stage I PPT Presentation has been Completed result in service delivery: (stocktaking) delivered. Village level data stage 1 Improving data to deliver Add some questions to Some additional ques- BPS added some ques- Completed result in service delivery: Podes 2018. tions on Podes 2018. tions as our request to Village level data stage 2 Podes 2018 draft. (Susenas Simulation) Developing concept Concept note/TOR on vil- The team discussed with Delayed note/TOR for stage II lage data strengthening. MoHA to determine pilot (pilot). locations. MoHA request- ed for pilot’s location is the champion village of each region. Pilot test: census, digital Pilot test report. Questionnaires for Ongoing map. census has been drafted and tested in Kabupaten Bojonegoro in Novem- ber and digital map tested in Bojonegoro. KIAT Implementation of quali- Implementation of quali- Midline report and end Midline survey com- Ongoing Guru tative survey and political tative survey and political line report. pleted. Midline report economy analysis. economy analysis. completed by December 2017, and end line report by June 2018. Implementation of end Implementation of end Edline survey implement- Initial discussions for Ongoing line survey. line survey. ed in 270 schools. survey implementation is on-going, with implemen- tation timeline between February and March 2018. 67 ANNE X E S aNNEX 3 (CONTINUED) Pro- Activity Sub Activity Planned Output/ Current Progress gram Target Progress Status KIAT Analysis of baseline, Analysis of baseline, Analysis plan for moni- Analysis plan has been Preparation Guru monitoring and learning monitoring and learning toring data and impact developed, data for anal- data on a quarterly basis, data on a quarterly basis, evaluation, and working ysis need to be struc- to be presented every to be presented every papers. tured. The first working six months to the Steer- six months to the Steer- paper on analysis of ing Committee. ing Committee. community score card indicators is expected by the end of December 2017. Analysis of baseline, Analysis of baseline, Analysis plan for impact Not yet started. Preparation monitoring and learning, monitoring and learning, evaluation, working and and end line data. and end line data. published papers. Implementation of Implementation of Baseline survey report. Implementation com- Ongoing baseline survey in 270 baseline survey in 270 pleted. The first draft for villages. villages. baseline survey report completed by October 2017. ECED Evaluation on Teacher Data collection: baseline Report on change in For teachers trained in Ongoing Competence using and end line, training of teacher competence. 2016: baseline and end Measurement of Early coders, analysis of data, line data collection is Learning Environment report. completed. For teachers tools. trained in 2017, end line data to be collected in June 2018. AC K N OW L E D G E M E N T S Program Manager: Kevin Tomlinson Task Team Leaders: Christopher Finch, Samuel Thomas Clark, Dewi Susanti, Lily Hoo, Rosfita Roesli, Ahmad Zaki Fahmi, Audrey Sacks, Nicholas Menzies, Adji Danya Delita Hakim, Ihsan Haerudin, Yulia Herawati, Sadwanto Purnomo, Bambang Soetono Writers and Editors: Peter Milne, Ashlee Schleger, Danau Tanu Secretariat Team: Daniel Seno Yusanto, Ashlee Schleger, Chatarina Ayu Widiarti, Eine Ayu Saraswati, Fibria Heliani, Hardini Utami, Hera Diani, Puji Wulandari Tunggadewi M&E Consultant: Clear Horizon, Bryan Rochelle M&E Focal Points: Budi Wijoyo, Christina Natalia Pardede, Karrie McLaughlin, Mochamad Pasha, Octaviera Ratna Herawati, Titiana Irawati, Thomas Brown Graphic Designer: Phoebe Wathoel Photographer: Fauzan Ijazah