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🇮🇩 Indonesia /Economy & Trade

Indonesian Social Assistance Recipients to Join Cooperative, Pay Dues

From Tempo · (3d ago) Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

TLDR

  • Indonesian Social Affairs Minister Saifullah Yusuf announced plans for beneficiaries of the Family Hope Program (PKH) to become members of the "Koperasi Merah Putih" cooperative.
  • Members will pay a principal contribution, with the ministry creating regulations to allow them to allocate a portion of their social assistance funds for these dues.
  • The cooperative aims to help low-income recipients improve their financial situation through savings and business activities.

The Indonesian Ministry of Social Affairs is introducing an innovative initiative aimed at empowering recipients of the Family Hope Program (PKH) by integrating them into the "Koperasi Merah Putih" (Red and White Cooperative). Minister Saifullah Yusuf detailed plans that will require PKH beneficiaries to become members of this cooperative, contributing a principal membership fee. This move is designed to foster a sense of ownership and financial discipline among participants, encouraging them to view their social assistance not just as aid, but as a potential springboard for economic self-sufficiency.

The Ministry of Social Affairs will create a legal umbrella so that they also have guidelines in order to set aside part of their social assistance or bansos to pay their principal dues.

— Saifullah YusufExplaining the ministry's plan to regulate the use of social assistance funds for cooperative dues.

To ease the financial burden on these vulnerable households, the ministry is developing legal frameworks that will permit beneficiaries to allocate a portion of their social assistance funds towards their cooperative dues. This pragmatic approach acknowledges the financial constraints faced by PKH recipients while providing a structured pathway for savings. The collected principal contributions will function as savings, with the ultimate goal of generating returns through the cooperative's business activities, thereby benefiting the members directly.

Consider this a form of savings from the beneficiaries, which in the end will also be received by the beneficiaries.

— Saifullah YusufDescribing the cooperative dues as a form of savings for the beneficiaries.

Minister Ferry Juliantono of the Ministry of Cooperatives and SMEs has expressed strong support for this program, seeing it as a vital tool to lift individuals from the lowest income deciles (desil 1 and 2) out of poverty. By encouraging participation in the Koperasi Merah Putih, the ministry hopes to create a sustainable source of additional income through profit-sharing (sisa hasil usaha). With a target of engaging 15-18 PKH participants per cooperative and a vast network of 80,000 cooperatives, the potential exists to positively impact up to 1.4 million beneficiaries, fostering job creation and economic resilience at the grassroots level.

We will make what they have to pay as low as possible.

— Ferry JuliantonoMinister of Cooperatives and SMEs' commitment to keeping cooperative dues affordable.
DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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