Indonesia: Govt Prepares Strategies to Reduce Economic Inequality

• Sep 11, 2017

TEMPO.CO, Jakarta – The National Development Planning (BPPN) Minister Bambang S. Brodjonegoro said that the government has several strategies to reduce economic inequality. “The normative ones include ensuring people’s participation in the social, political and economic contexts,” he said last week.

Bambang said that the first point means that the government will open up quality job opportunities. A quality job has 40 working hours a week in the formal sector. The government will also encourage people to become businessmen. “Not jobs with one working hour a day in the informal sector.”

Moreover, the government will facilitate ownership of financial and non-financial assets for people who do not possess enough assets. “The president has been handing out land titles to people. One of the aims is to boost asset ownerships of the people,” Bambang said.

Access to public services is being improved by enhancing human resources quality. Bambang said that the access must be provided even to unborn children. “To those who are born even from poor families; with a good access to public services, they could make it into the middle class.”

Bambang added that other factors include redistribution of state resources generated from tax revenue. The government must ensure that taxes are being utilized to establish equal development. “What creates an extreme inequality is people’s refusal to pay taxes.”

Another policy being prepared to reduce wealth inequality is agricultural reform. He said that an average farmer in Java owns less than a half of hectare of land. A narrow land hampers farmers from improving their quality of life. “As a result, poverty will continue to haunt farmers. Therefore, they need to be empowered, at least by being given more lands,” Bambang said.

Bappenas report that Indonesia’s Gini ratio stood at 0.393 as of March 2017, representing a slight declined from last year figure of 0.397. Rural areas have the highest ratio that contributes to the national wealth inequality.

Source: https://en.tempo.co/read/news/2017/09/11/056907940/Govt-Prepares-Strategies-to-Reduce-Economic-Inequality