Indonesia’s Social Assistance Program Faces Mounting Criticism Over Mistargeting and “Politics of Knowledge”
A recent report reveals that nearly half of Indonesia’s social assistance recipients may have been incorrectly identified, raising questions about the efficacy of Conditional Cash Transfer (CCT) programs and the complex systems used to determine eligibility. While initially lauded for improvements in health and education, the flagship “Family Hope Program” (PKH) is now grappling with widespread protests and accusations of unfairness, highlighting a fundamental disconnect between technocratic approaches to poverty and local realities.
The Promise and Peril of Conditional Cash Transfers
Conditional Cash Transfer (CCT) programs, operating in 64 low- and middle-income countries, aim to break the cycle of poverty by providing direct financial assistance to low-income families contingent on meeting specific requirements, such as school attendance or regular health checkups. These programs promise efficient targeting and investment in crucial areas like nutrition, health, and education. However, critics increasingly debate their effectiveness, pointing to issues of implementation and inherent limitations in accurately identifying those most in need.
Indonesia’s PKH Program: From Success Story to Source of Contention
Since 2005, Indonesia has significantly expanded its PKH program, now reaching an estimated 40 million people – 10 million families – making it the second-largest CCT program globally. Initial assessments indicated positive impacts, including reduced stunting rates, increased school enrollment, and improved maternal health outcomes. However, reports surfaced in September 2025, indicating that as much as 45% of recipients may have been mistargeted.
The revelation that over 1.9 million households were receiving benefits they weren’t eligible for prompted a government pledge to digitize the system and strengthen oversight. A subsequent verification process of 12 million recipients led to the removal of ineligible individuals, sparking waves of protests and complaints from those who believed they were wrongly accused or victims of systemic errors. This underscores a critical tension: while designed to alleviate poverty, the program itself is generating new forms of hardship and distrust.
The Case of Mexico: A Cautionary Tale
Indonesia is not alone in facing challenges with CCT programs. Mexico, a pioneer in the field, ultimately abolished its program after two decades of implementation, finding that poverty levels had not improved. According to reports, the decision stemmed from a desire to reduce administrative burdens and address the negative impacts of strict program conditions on recipients, prompting a fundamental re-evaluation of the approach.
Beyond the Numbers: The “Politics of Knowledge”
A recent study undertaken by researchers explored the consequences of CCT practices on understanding and measuring poverty in rural Indonesia. The research revealed that the problems extend beyond mere implementation issues. The core issue lies in what the study terms the “politics of knowledge” – the dominance of particular ideas about poverty that shape policy, often sidelining alternative understandings.
CCT programs rely on complex data systems and practices, including proxy means tests (using observable household characteristics as indicators of poverty), social registries (collecting extensive data on families), and econometric algorithms (ranking households based on eligibility). While aiming for objectivity and efficiency, this technocratic approach often simplifies complex social realities.
The Reality on the Ground: Disconnect Between Data and Lived Experience
Field research in rural Indonesia revealed significant discrepancies between “objective” poverty data and the realities experienced by communities. Enumerators, under time pressure, often take shortcuts. Village leaders struggle with pre-selected beneficiary lists that exclude deserving families, eroding trust in local government. Individuals, aware of the system, may strategically hide assets to appear poorer.
The system’s reliance on simplified indicators misses crucial nuances of household welfare. A convoluted, centralized system is prone to errors and data management problems, leading to late disbursement of funds and, ultimately, mistargeting. In some communities, the program reached only 44% and 23% of households identified as poor by local wealth ranking exercises. Many recipients fell just above the official poverty line, while the most food-insecure families were often excluded.
The Paradox of CCTs: Opportunity and Contestation
CCTs, like Indonesia’s PKH, can provide direct payments to millions, improving statistical indicators for health, nutrition, and education. However, these gains are often accompanied by significant mistargeting, endless “repair” processes, and social problems like jealousy and unrest. While creating opportunities for access to state resources, CCTs also provoke responses and contestations, leading to a contentious local politics of distribution.
The implementation of these programs involves a constant process of “translation,” where officials reinterpret program designs to fit local contexts. This often leads to patterns of inclusion and exclusion that conflict with community perceptions of need and deservingness. Village leaders often engage in informal redistribution to mitigate social tensions arising from perceived unfairness.
Shifting the Paradigm: Towards More Inclusive Approaches
Addressing these challenges requires a fundamental transformation of the governing knowledge systems underpinning social assistance programs. Policymakers must move beyond narrow technocratic approaches to poverty measurement and incorporate community understandings of need. Recognizing the limitations of proxy indicators and rapid survey approaches is crucial.
Studies suggest that accurately identifying the poor using econometric targeting, even with community-level screening, remains exceedingly difficult. This necessitates a shift towards more inclusive approaches, such as universal schemes or simple lifecycle transfers, rather than narrowly targeting the extremely poor. Assistance must align with local notions of fairness and social reciprocity.
Ultimately, effective poverty reduction requires broadening our ways of knowing and measuring poverty while simultaneously tackling the structural foundations of poverty. Indonesia’s experience demonstrates that anti-poverty programs fall short when they prioritize technical solutions over social, economic, and political realities.
This article was first published on the Development Pathways blog on 20 January 2026.
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