Max Lane – It has been almost a month since the Indonesian government increased the retail price of petrol by 126% and of kerosene by 300%. The increases are a part of the Jakarta government's commitments made to the International Monetary Fund (IMF) between 1997 and 2004. In addition, public transport fares and food prices have increased, eating into people's meagre incomes in a country where most live on around US$1 a day or less.
The IMF policy has been enthusiastically supported by many of the Australian-trained economists, mostly from the Indonesia Project at the Australian National University, who advise Indonesian President Susilo Bambang Yudhoyono's government.
Not surprisingly, these policies have brought even more hardship to most Indonesians. Most people use small kerosene stoves for cooking and boiling drinking water. Following the price hikes, reports have surfaced in the press of people scrounging for wood to replace kerosene.
These policies are turning millions of Indonesians into beggars. To supposedly help people deal with what President Yudhoyono has called "short-term pain" – he uses the English phrase – the government announced a scheme to compensate poor people with a Rp300,000 (A$42) cash handout. In local jargon, this cash will go to gakin to help them with their jadip. Gakin is short for keluarga miskin or "poor families". Jadip is an abbreviation invented after the Aceh tsunami, short for jatah hidup (ration to live). The Central Bureau of Statistics (BPS) is supposed to help the government determine who should get compensation, using a monthly income of around Rp100,000 (A$15) as the cut-off point. The minimum wage in Indonesia is around Rp750,000 (A$105) depending on the region.
The head of the BPS, Choril Maksum, told a parliamentary committee on October 24 that the BPS has authorised the issuing of 7 million cards identifying people as gakin. However, newspapers report that another 3 million families have registered for the compensation payment. Maksum told the committee that his staff were afraid to go home at night because they are being threatened and their houses are being stoned. He said the BPS would contact the additional 3 million who were trying to "coerce" the BPS into classifying them as poor.
People who "qualify" as gakin receive a voucher from the local "neighbourhood head". They then take it to the post office or another distribution point to cash it in. The houses of neighbourhood heads have become the sites for demonstrations and occupations by angry poor people who are unable to receive a payment.
Every day the Indonesian press reports these protests. The poor are often armed with machetes or scythes as they demand vouchers. There are many reports of neighbourhood or village heads being beaten. Some offices have been attacked and wrecked. In many cases, neighbourhood heads have decided to resign or they have simply run away. In other cases, groups of neighbourhood heads have gone to the police to ask for protection. In Sulawesi, even the blind have been demonstrating in response to being denied the compensation payment. On October 26, the Jakarta newspaper Kompas reported the first death of a neighbourhood head, stabbed by a poor person who would not accept the head's explanation that he did not decide who was to get the money. On the same day, another died of a heart attack after poor people surrounded his house.
There are also reports of poor people, especially the elderly, dying. After receiving their voucher, people must take it to a cash distribution point. Large numbers of people queue for a long time in the tropical sun. On October 18, Kompas reported the death of Kasipah, an 80-year-old man. He was queuing in the village of Karangsari in East Java. He collapsed and died on the way to hospital. In the town of Dempet in Central Java, Kompas reported the death of Wadiman, a 70-year-old man. He had been squeezed among a crowded queue waiting for his compensation and died of suffocation.
Similar tragedies have been reported in Sumatra, Java, Kalimantan and Sulawesi. Detailed news articles are appearing in Jakarta and provincial newspapers. There are pages and pages of reports detailing the suffering of the people and their desperation to receive the miserly government handout.
The callousness of the government was underlined by a cavalier statement by vice-president Jusuf Kalla, who is also a wealthy businessperson and the chair of the Indonesian parliament's largest party, Golkar. He is reported to have said: "What are all the complaints about queues, we queue for cinema tickets don't we?"
The inadequacy of Rp300,000 handouts to deal with the impact of the IMF-imposed price rises is doing huge damage to social solidarity, generating tensions between those who receive the payment and those who don't. Newspaper reports describe how in the same queue, there are women dressed in rags with the minimal documentation to prove their status, as well as young men with all their documents photocopied and kept neatly in a nice briefcase. In villages, there are disputes as to who is the poorer among neighbours.
This exposes the bankruptcy of the so-called economists and their statistics on minimum wages, average wages and poverty levels. Anybody with a minimum of direct contact with working people in Indonesia's towns and villages knows that every working person supports five, 10 or even more family members who are not working. There are tens of millions of people who have no direct income, or who eke out a living of less than Rp300,000 a month.
The fuel price rise's impact on the general economic climate is not helping the situation. The Indonesian Textile Association stated on October 25 that it expected 500,000 workers – 300,000 in factories and 200,000 home workers – to lose their jobs. The association is calling for tax relief as a means of staving off the dismissals. A report in the daily Rakyat Merdeka quoted the minister of labour saying that he expected 1 million workers in the timber, textile, footwear and electronics industries to lose their jobs as a result of the price increases.
Meanwhile, another controversy rages in the press over the decision of the parliament this month to increase MPs' salaries by 30%, to Rp30 million per month on top of their allowances for hotel accommodation, transport and the money they receive from lobbyists.