Muhamad Al Azhari – The government says the national poverty rate has fallen due to steady economic growth, stable prices for staple foods and the impact of the economic stimulus package, rather than the effect of the direct cash assistance scheme for poor families.

The scheme, also known as the BLT, was singled out earlier in the week as the main reason for the declining national poverty rate.

Data released by the Central Statistics Agency (BPS) on Wednesday showed the poverty rate at 14.15 percent of the total population in March 2009, or 32.53 million people. This was down from 15.42 percent in March 2008, equivalent to 34.96 million people.

Drajad Wibowo, a legislator from the National Mandate Party (PAN) and a member of House of Representatives Commission XI overseeing the state budget, said the poverty rate had fallen due to what he described as the "artificial effects of the BLT."

Shortly before the campaign season for the legislative elections began in March, the government disbursed Rp 3.7 trillion ($363 million) to 19 million families as part of the last phase of the BLT payments.

Families eligible for the BLT program each received Rp 200,000 in direct cash assistance. The timing was criticized, however, for coinciding with the current government's election campaign.

But Paskah Suzetta, the head of the National Development Planning Board (Bappenas), told a Commission XI hearing on Thursday that the decline in the poverty rate had little to do with the cash handouts.

"The poverty rate fell more because economic growth has remained steady," he said. "In 2008, it was at 6.1 percent and in the first quarter of 2009 it was at 4.4 percent year-on-year. A number of government programs designed to anticipate the impact of the global economic slowdown have been implemented well."

Paskah said manageable inflation, which led to stability in basic food prices, also helped to improve living standards for the country's poor.

Rusman Heriawan, the head of BPS, said the impact of the direct cash assistance scheme on the national poverty rate was limited, compared with other government programs that had a significant effect.

Rusman said that the combined government social safety net program helped families that had been living under the poverty line.

BPS classifies households that earn less than Rp 200,262 per capita per month as "poor." The classification was raised from Rp 182.636 per capita per month in last year's calculations.

The Rp 200,262 per capita per month figure was considered to be sufficient to meet the individual need for 2,100 calories per capita per day.

"Even if you don't work, but you can still get the required 2,100 food calories needed per day, you will not be included in the official definition of what it means to be poor in this country," Rusman said.