Poverty Reduction Must Be Accompanied By Empowerment

Poverty (Photo: Antara)

Poverty alleviation is considered to require a comprehensive approach. The reason is, not only providing social assistance but also empowering the community to be economically independent.

Executive Director of the Center for Strategic and International Studies (CSIS) Yose Rizal Damuri highlighted the fact that currently the middle class which is expected to grow and support the national economic growth of the community has actually decreased in recent years. This condition shows that economic empowerment efforts still need more attention.

A number of analysts noted a decline in the proportion of the middle class in Indonesia. According to data from the National Socio-Economic Survey (Susenas) processed by Bank Mandiri, the proportion of the Indonesian middle class in 2019 reached 21.45 percent of the population. However, that number dropped to 17.44 percent in 2023.

"The issue of community economic empowerment needs to be considered further so that we can create a stronger community economy and a middle class that is better able to face various economic problems in the future," Yose said quoting Antara.

When delivering the speech of the 2025 RAPBN at the DPR RI Plenary Session in Jakarta, Friday, President Joko Widodo (Jokowi) said that the poverty rate fell sharply to 9.03 percent in 2024. The extreme poverty rate also fell to 0.83 percent in 2024.

Then, the unemployment rate fell to 4.8 percent in 2024.

The government allocates a social protection budget of IDR 504.7 trillion in the 2025 RAPBN to reduce the burden on the poor and vulnerable, and accelerate poverty alleviation, which is carried out more on target, effective and efficient.

The portion of the social protection budget in the 2025 RAPBN reached 14 percent of the total state expenditure plan of IDR 3,613.1 trillion. This value increased compared to the allocation of the social protection budget in 2024 of IDR 493.5 trillion.

"The budget should not only be used to finance, provide social assistance that prevents people from becoming poor, but also to finance economic empowerment from the community so that they become better than the current conditions," said Yose.

The government hopes that the open unemployment rate in 2025 can be reduced to 4.5 percent'5 percent, the poverty rate is lowered in the range of 7'8 percent, and the Gini ratio is in the range of 0.379'0.382.

President Jokowi said the 2025 RAPBN was designed to maintain stability, inclusiveness, and sustainability to improve welfare and equity through inclusive and sustainable economic growth.

"The 2025 State Budget Architecture is an important pillar to maintain sustainability through strengthening various sustainable flagship programs from the current government to the upcoming government," the president said in his speech.