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Social Affairs Minister introduces PENA program at OECD International Economic Forum
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ocial Affairs Minister Tri Rismaharini revealed that the government was conducting empowerment programs as part of its efforts to overcome poverty. One of the ministry’s efforts was the National Economic Hero Program (PENA).
In a High-Level Roundtable Forum in in Jakarta on Wednesday, titled Startup Asia: Chasing the Innovation Frontier – The Case of Indonesia, organized by the Organization for Economic Co-operation and Development (OECD) Development Center and the European Union online, the social affairs minister gave the history of PENA’s conception, a duplicate of the Economic Program (PE) Surabaya in 2010. The Surabaya program succeeded in reducing the poverty rate in Surabaya city when Risma was mayor.
"This approach [economic empowerment] has been duplicated and modified for the national program called PENA," said the minister.
The PENA program provides training and mentoring to build the capacity of beneficiaries to create sustainable entrepreneurship or start-ups.
"When I started, poverty in Surabaya was at 14 percent. This first step was seen as a milestone. Reaching only 86 women from suburban areas in Surabaya, we started Economic Hero (PE) Surabaya in 2010," she said.
During that 10-year journey, she said, the number of participants grew from 86 to 12,382 in 2020. Some of the group went on to master skills and reached new heights as millionaires and billionaires. The poverty rate dropped dramatically to 5 percent.
The PENA program was then duplicated and modified by the Social Affairs Minister Risma during her leadership. PENA, an entrepreneurship program, targets poor and vulnerable groups, namely the beneficiaries of the Family Hope and Basic Food social assistance programs, by providing training and assistance for beneficiaries to grow sustainable businesses. The difference between the PE and PENA programs is the PENA program provides capital assistance adjusted to the business plan or business of the beneficiary.
"Last year, we started with 5,209 families and are planning to expand further to 7,500 families this year," said Minister Risma.
PENA beneficiaries are selected through a series of processes with certain criteria such as being in the productive age group and having a start-up business. Their business idea plan is then submitted and processed for selection. If accepted, the recipient will get the full benefits of PENA in the form of capital and business consulting.
"All PENA beneficiaries are given access to weekly sessions with mentors who assist them in product development, digital marketing and financial management," said Risma.
The Social Affairs Ministry also encourages inclusive economic empowerment by targeting the PENA program for people with disabilities.
"If people with disabilities, the homeless, beggars and other street people can do it, anyone can do it too. I believe that everyone can live a better life future and get out of poverty," she said.
Since 2016, Indonesia has supported start-up development through several programs, namely through incubation and mentoring to grow innovation with the aim of inclusive and sustainable development.
At this moment, the OECD Development Center director Ragnheiður Elín Árnadóttir said, the OECD placed Indonesia as a top priority on the development agenda.
"We realized after seeing the [Indonesian government's] innovation explanation, that forming entrepreneurship is the key to increasing economic growth," she said.
Tourism and Creative Economy Minister Sandiaga Uno, who was also present at the forum, said that the role of the government, Social Affairs Ministry, the Tourism and Creative Economy Ministry and the Communications and Information Ministry in developing start-ups does not only generate an economic impact but also provides additional social and environmental benefits. "The government is very concerned about start-up programs such as inviting, training and promoting, both domestically and abroad," said Sandiaga.
Meanwhile, the European Union Ambassador to Indonesia and Brunei Darussalam Vincent Piket said that the start-up conditions in Indonesia showed rapid growth. At the same time, the government had opened opportunities to increase the income of poor people by providing access to technology and various services.
"A good growth agenda in Indonesia to help accelerate economic growth, Mr. Sandiaga Uno said in his remarks, and thanks to Minister of Social Affairs Tri Rismaharini for continuing to support entrepreneurship for vulnerable groups and persons with disabilities. This can certainly be used as an example for other countries in making micro business units, new start-ups for the poor communities to become empowered and independent," he said.
Annalisa Primi, head of Development and Economic Transformation at the OECD Development Center, also expressed her highest appreciation for what Social Affairs Minister Risma had done so far.
"Thank you, Minister Risma, for the real efforts to form micro-inclusive entrepreneurship to help the poor become prosperous. Good practices that other stakeholders can emulate," she concluded.
Also attending the event were representatives from the Communications and Information Ministry, representatives of both national and international organizations/institutions and representatives of other Indonesian start-ups.
The OECD is an international organization with 38 member countries based in Paris, with its mission to form policies that promote equality, opportunity and prosperity for all. The OECD partners with several countries, one of which is Indonesia. The Roundtable session discussed the economic transformation in Asia, especially the picture of start-ups in Asia.
