Indonesia's Social Policy Response to Covid-19: Targeted Social Protection under Budget Constraints

Abstract

This report discusses Indonesia’s social policy response to Covid-19 as well as the public’s response to this policy response. It finds that the Indonesian social policy response to the pandemic was mainly through reallocations within the government budget to finance targeted social safety net programs covering social assistance, family support, and labor market benefits. These budget reallocations, however, have been insufficient to cover all the poor, thus the government sought financial support from the World Bank, global bonds, and local governments. The government’s social policies stimulated public responses, including both support and opposition from politicians and community members. The most salient support stemmed from the community in the form of collectively working to informally provide assistance to the poor. Community support for the poor and the participation of global agencies in welfare provision underline the limitations of state social policy during times of socio-economic adversity, particularly due to budget constraints. During the crisis, the state, which should be able to protect its citizens, was less capable of providing social protection, prompting it to seek support from both global and local welfare providers.