REPUBLIK INDONESIA

KEYNOTE SPEECH
MULTIDIMENSIONAL POVERTY MEASUREMENT
WORKSHOP

Minister of National Development Planning /

Head of National Development Planning Agency

Jakarta, 24 May 2017

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Poverty Reduction in Indonesia
The Poverty Rate in Indonesia
The Government Poverty Reduction Target
10.96% (September 2014)

10.7% 7-8%

2014 2019 10.7% (September 2016)

The economic challenge is one of the factors affecting the slow poverty reduction.
These include less productive living habits to unaccommodating facilities and
infrastructures.
Indonesia's poverty characteristic is indeed complex and multidimensional, not to
mention challenges it faces in reducing inequality among income groups

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Poverty Alleviation Complexity and Role of Government
INDONESIA

To reduce the number of poor people, the Government has prioritized Poverty Reduction in
2015 - 2019 Five Years National Development Plan

Act as an activities implementers

Designed and Poverty More in-depth knowledge of local
Central Local
developed policy Government Governments condition needs
alleviation Have the capacity to identify the
programs
right program to improve poverty
alleviaton

Various parties have developed numerous poverty measurements with aimed to serve as intervention
instrument for dealing with poverty.
However, measuring poverty based solely on income has its limitation as it does not illustrate the real
poverty.
Based on two basic principles namely precise targeting of (a) beneficiaries and (b) location, poverty
reduction programs are expected to better reach their objectives.

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Multidimensional Poverty Index

OPHI introducing the Multidimensional Poverty Index, a method to measure from

multidimensional poverty indicator.
From a planner perspective, measurement results that able to capture households/
individuals facing various poverty-related problems will matter the most.
In Indonesia, the poverty line established by BPS consists of food and non-food groups.
Household expenditures on non-food groups may more or less illustrate non-food
aspects of a welfare situation namely health and education.
Meanwhile, household/individuals data contained in the Unified Database, have actually
incorporated several characteristics such as assets, residence, type of business,
education, occupation of head of household, and others.
All of these indicators form a proxy mean test indicator/score based from the
characteristics used, the data can be categorized as a multidimensional poverty index,
for targeting household-based / individual programs.

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