Chapter -1 final last new font final - petrofed.winwinho...

Ghana, Indonesia and Jordan all recently observable household socio-economic
raised petroleum product price. The key characteristics. Beneficiary cards and
mitigating measures they took to protect the receipt coupons are printed and
poor were: delivered by the post office. Eligible
households with access to a post office
collect their cash quarterly on designated
Ghana days. Those in remote areas without such
access receive cash in their village.
• Fees for attending primary and juniorsecondary
school were eliminated. • Some budgetary savings from reducing
• Extra funds were made available for subsidies were reallocated to existing
primary health care programs education, health and infrastructure
concentrated in the poorest areas programs that disproportionately benefit
through the existing Community Health low and middle income households.
Compound Scheme. • Initially, the subsidy on kerosene was not
• Investment in the provision of mass substantially reduced, and its price
urban transport was expanded and remained at two-thirds of the world price.
expedited.
H o w e v e r, s u b s e q u e n t t o t h e
• Extra funds were made available to
expand a rural electrification scheme.
implementation of the transfer program,
the kerosene subsidy has been
substantially reduced.
Indonesia
Mitigating Measures on account of price rise -
Country Experience
33
Jordan
Indonesia has an extensive history of
subsidizing certain oil products. The
continuation of this policy has vastly
increased total cost to Government.
• The minimum wage was increased, as
were the salaries of low -paid
government employees.
Eventually the Government took up the • A one-time bonus was given to lowchallenge
of large fuel price increase, and income government employees and
simultaneously addressed potential adverse pensioners.
impacts on the poor. • An electricity lifeline tariff was
maintained at current low levels-
• An unprecedented cash transfer program
electricity access is almost universal.
to 16 million poor families was • Cash transfers were provided to other
implemented. Under the program, each low income households.
family receives Rp. 300,000 (about
US$30) every three months. The full
annual cost of the program is estimated
at nearly 0.7 percent of GDP. The
identification of poor households is
based on an existing approach used by
the Central Statistics Bureau, which
calculates a “proxy-means score” for
• The government announced a plan to
increase funding to the National Aid
Fund as part of a program to improve the
design and implementation of this
national safety net program with World
Bank assistance.
potentially poor households based on Source: IMF Working Paper WP/07/71
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