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Indonesia

Indonesia. Managing Corruption in the Scaled-Up PNPM Program PNPM team members: Behdad Nowroozi, Jana Halida Uno, and Unggul Suprayitno March 2008. Why PNPM Is Interesting. Scale – Nationwide coverage Role in national poverty reduction strategy Local participation and accountability

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Indonesia

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  1. Indonesia Managing Corruption in the Scaled-Up PNPM Program PNPM team members: Behdad Nowroozi, Jana Halida Uno, and Unggul Suprayitno March 2008

  2. Why PNPM Is Interesting • Scale – Nationwide coverage • Role in national poverty reduction strategy • Local participation and accountability • Robustness for post-conflict and emergency work • Governance and anti-corruption • Simple and innovative FM features

  3. PNPM’s Internal Architecture • Unearmarked block grants of $50,000-125,000 are sent directly to sub-districts (10-40 villages) • Community organizations plan and manage activities, aided by facilitators • Open menus (i.e. Multisectoral) • Procurement and financial management are done at sub-districts and villages • Provincial and district oversight and support --but no veto power

  4. Geographical Coverage From 1998 to 2006, KDP aqnd UPP have covered 34,000 of the poorest communities in Indonesia, covering approximately 49 percent of the entire country.

  5. PNPM Challenge KDP and UPP are VERY LARGE PROJECTS • Total 1998-2006 financing is $1.8 billion • They disburses about $200+ million/year BUT PNPM IS MUCH LARGER • It will disburse $1.2 billion each year over time • It will annually cover 70,000 villages, all of them in a poorly communicated archipelago

  6. PNPM Urban Challenge “UPP” IS THE URBAN ARM OF PNPM • Its scale-up is very steep • Urban communities are more volatile than rural areas • Initial greater use of revolving funds that are hard to monitor But opportunities for better FM management include • Good access to information • Active urban civil society • Ability to organize and resist • High literacy rates

  7. PNPMs Rural Challenge • Communities are highly dispersed and isolated • Functional illiteracy is high • Distance to government is large But there are opportunities too… • High social solidarity/social capital • Local elections • Prior experience with revolving funds

  8. KDP Corruption Cases Reported

  9. UPP Corruption Cases Reported

  10. PNPM’s Design Strategy For Reducing Corruption • Lower costs of acquiring information • Minimize transactions • Promote participation and ownership • Use social controls • Strengthen transparency • Strengthen formal oversight capacity • Apply sanctions swiftly and consistently

  11. FM Challenge • Weak national oversight agencies • Highly dispersed subprojects • Elite capture remains a concern • Making controls meaningful • Better use of audit • Use technology to promote transparency

  12. PNPM’s FM Innovations • Formal Transparency Policy • Book-keeping by trained community members • NGOs and journalists provide oversight and reporting • Risk-based audit manual for government auditors • Legal and paralegal assistance for using the courts

  13. HOMEPAGE www.p2kp.org • Running text • Announcement of facilitator recruitment • Important document: guidelines, letter, TOR, socialization materials, training module • UPP today (news) • Dialogue forum • Complaint Handling • Contact Number of Facilitator and Community • Consultant’s Contract • Dissemination of learning and article on interesting experience, best practice • Data on : • - Implementation progress : MIS and quick status • - Utilization of fund at village, region, national level, • Profile of kelurahan • - Address of UPP Information Center 1000 - 3000 visitors per day

  14. Strategy For Strengthening Formal Oversight • Improving the audit • Increasing audit sample from 2.5% to 7.5% • Tailoring the audit manual • Sharing audit results with communities and local governments • Strengthening capacity • Twinning local audit agencies with national agencies • Special training • Promoting feedback from clients

  15. World Bank Supervision Strategy For Reducing Corruption • Supervise frequently • Check the checkers • Visit the sub-projects and confirm end-uses • Find allies in government and civil society • Measure & report • Respond quickly and consistently • Graduated application of sanctions

  16. Future Directions • Better use of Info Technology (i.e. websites) • Educate population, esp. leaders • Restitution rather than sanctions • Constant evaluation

  17. PNPM-UPP Illustrating Complaint Handling

  18. UPP: Complaint Handling Type of Complaint Web based CHU Type of Case 1000 - 3000 visitors per day

  19. SMS Broadcast & Tele Supervision Review Request for SMS Broadcasting SMS Pool (Database at PMT) Yes Broadcasting SMS No Archive in UPP Website

  20. Complaint Handling

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