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Box 3.1 – Implications of the rights approach for policy makersThe rights approach has major implications for policy makers. 21 When preparing a development strategy they must ensure that all stake-holders canparticipate actively and with sufficient information at all stages - formulation, implementation, and monitoring. Participation will necessarily be diverse in formand shape, but one of the most important requirements is to ensure that people have institutions (legal and otherwise) that enable then to become fullyinvolved. For this purpose it is essential to guarantee civil and political rights - including the right to information, the right to freedom of expression, the rightto free association, and the right to equal access to justiceWhile policy makers must aim to fulfil all rights completely they may not have the resources to do all this immediately - but instead deal with some rightsprogressively over a period of time. However they cannot use this as an excuse for relaxing their efforts. First they must take immediate action to fulfil anyrights that are not seriously dependent on resource availability and re-focus priorities so as to divert resources from relatively non-essential uses to thosethat are essential for the fulfilment of rights.Then for those rights that do have to be deferred because of resource constraints, they should establish a time-bound plan of action for progressive realization.The plan should include a set of immediate as well as final targets, based on indicators that can be used to monitor success and failure, along with institutionsthat can hold the state to account.Indonesia’s experience at meeting humandevelopment rightsPrior to the recent crisis Indonesia was quite successfulin fulfilling some basic rights – translating rapid economicgrowth into equally rapid human development. Startingfrom a low base in the mid-1960s, Indonesia steadily closedthe human development gap with its South-East Asianneighbours. As a result, in terms of human developmentIndonesia’s global ranking is similar to its ranking in termsof per capita income. This indicates that the country’shuman development performance is average for its currentlevel of economic development: it is neither an underachievernor an over-achiever.Progress so far has partly been the result of combiningrapid economic growth with a slowdown in populationgrowth, leading to a substantial rise in general livingstandards and a marked reduction in poverty. This linkbetween economic growth and poverty reduction wasparticularly strong because during the entire period of rapidgrowth there was no increase in inequality: incomedistribution remained fairly stable.Economic growth translates into human developmentin a number of ways (Box 3.2). Some of this is throughinvestment by the government in public services and someis the result of increased private expenditure on food, onhousing or on health or education. In Indonesia the publicspending component has been relatively low: as aproportion of GDP, public investment in these serviceshas been substantially below the average for developingcountries (Figure 3.1) – though one compensating factorwas that much of this was concentrated on basic services,with a fair amount of emphasis on the provision of primaryhealth care and primary education.Figure 3.1 – Public expenditure on health and education, average 1996-2000 (% GDP)Source: World Development Indicators21 Osmani (2003).24National Human Development Report 2004
Box 3.2 – Pathways to human developmentThere are various pathways to achieving human development, but some are more useful than others - depending on the particular circumstance of a countryand its development priorities. Economic growth can lead to human development first by raising overall living standards and reducing poverty and secondby increasing the government's capacity to spend more on education, health care and various poverty-focused programmes.Neither of these links between growth and human development can be taken for granted. The former link will depend on the quality of growth in terms ofincome distribution. The latter link will depend on the government's spending priorities. Some high-growth countries like South Korea, where incomedistribution is reasonable and there has been adequate public expenditure, have been able to translate growth into human development while others, likeBrazil, have had far less success in doing so because they have had a history of extreme income inequality coupled with a neglect of public health care.Even among countries that have achieved both rapid growth and human development, the relative importance of the above two links may vary, and withcontrasting results. Some countries may rely too much on private rather than public expenditure on health care and education. This may improve aggregatelevels of human development but it can also lead to greater inequality since the benefits from private expenditure will be less equally distributed than thosefrom public expenditure. There is thus a need for an appropriate balance between the roles of the private and public sectors in providing social services. InIndonesia the balance in health care, for example, has swung too much towards private expenditure and needs to be corrected by increased publicinvestment.Besides these pathways, the various dimensions of human development have synergistic relationships, reinforcing one another's impact. It is importanttherefore to achieve appropriate combinations of public support in each of these areas. This is not easy. But the rights-based approach can help since itdemands the active participation of the beneficiaries themselves. They tend to have a much better appreciation of how best to use limited resources in anoptimal manner.GDP GrowthIncomedistributionPublic socialspendingImprovements in living standards andreduction in povertyPrivate spending oneducation andhealthImprovements in health and educationindicatorsSynergiesCivil society organizations can also play an important role, especially when public spending is inadequate. Indonesia's remarkable achievements in socialdevelopment despite very low public expenditure can be attributed to contributions of a large number of community organizations.This relatively low public expenditure has had to beoffset by higher private spending. This is particularlyevident in the case of health. In Indonesia private spendingis responsible for around 80% of total health expenditureleaving the government responsible for only around 20%.Again, this is a much lower proportion than in many otherdeveloping countries (Table 3.1).Private expenditure may appear to compensate forpublic expenditure. But it can only do so partly since it ismuch less equitable. While public expenditure on primaryhealth care is spread fairly equally across social classes,private expenditure is inevitably skewed towards the rich. 22In 2002 the poorest 20% were responsible for only 8%of private expenditure on primary care while the richest20% were responsible for 39%. The contrast is evenstarker when it comes to hospital care (Table 3.2).Given their lower standards of nutrition, housing andeducation, the poor are always likely to have lower healthstandards. But this over-reliance on private healthproviders tends to exacerbate the health divide between22 Even in the public healthcare system, the poor are disadvantaged in terms of the quality of service they get and in terms of their ability to access hospital treatment. For moreevidence of the rich-poor divide in health and educational achievements, see World Bank (2001), p. 69.National Human Development Report 2004 25
Page 2 and 3: NationalHuman DevelopmentReport 200
Page 4 and 5: ForewordIndonesia has made critical
Page 6 and 7: AcknowledgementsThis Report is a re
Page 8: AbbreviationsAPBDAPBNASEANBAPPENASB
Page 11 and 12: TABLES2.1 - Comparison of per capit
Page 13 and 14: EXECUTIVE SUMMARYIndonesiaNational
Page 15 and 16: to meet the Millennium Development
Page 17 and 18: Chapter 1Indonesia in transition:To
Page 19 and 20: The place of human development in I
Page 21 and 22: Chapter 2The state of human develop
Page 23 and 24: Figure 2.4 - Map of human developme
Page 25 and 26: Figure 2.4 - Social indicators, 197
Page 27 and 28: of income and corporate taxes has r
Page 29 and 30: Figure 2.10 - GDP growth, 1990-2003
Page 31 and 32: Table 2.4 - Proportion of total bri
Page 33 and 34: In addition, the overall sense of p
Page 35: themselves. On this basis Indonesia
Page 39 and 40: Table 3.3 - Infant mortality rate a
Page 41 and 42: poor is a clear recognition that de
Page 43 and 44: educing the infant mortality rate m
Page 45 and 46: assuming that 1.3 trillion would co
Page 47 and 48: The national figure would certainly
Page 49 and 50: expenditure. In practice, it would
Page 51 and 52: Table 4.2 - Provincial breakdown of
Page 53 and 54: administration, plus an allowance f
Page 55 and 56: Figure 4.5 - Ratio of salaries of p
Page 57 and 58: Appendix to Chapter 4Health and edu
Page 59 and 60: The third is the ‘Special Fund’
Page 61 and 62: Chapter 5Rethinking fiscal prioriti
Page 63 and 64: At the very outset, however, it sho
Page 65 and 66: enforcement particularly for person
Page 67 and 68: Another risk from decentralization
Page 69 and 70: Box 5.2 - Variations in poverty con
Page 71 and 72: physical security - which contribut
Page 73 and 74: centre, for example, played a signi
Page 75 and 76: BibliographyAbidin, A. (2002), 1 st
Page 77 and 78: LPEM-FEUI (2004), Draft Final Repor
Page 79 and 80: Subbarao, K., A. Bonnerjee, J. Brai
Page 81 and 82: HUMAN DEVELOPMENT INDICATORS AND IN
Page 83 and 84: The human development approach brin
Page 85 and 86: Box 2HDI, HPI-1, GDI and GEMHuman D
Page 87 and 88:
What do the human developmentindice
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Table 1 - Districts making the grea
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Table 2 - Districts with the highes
Page 93 and 94:
Figure 8 - GDI by province, 1999-20
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Figure 12 - HPI by components, 1999
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Technical workshopon human developm
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• The percentage of households wi
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11 Percentage of people with self-t
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Annex 2N a m esGROUP IIChairperson:
Page 105 and 106:
Changes in names due to the formati
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LampungKab. Lampung Selatan (South
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1Human Development Index (HDI)by pr
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3Gender-related Development Index (
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5Human Poverty Index (HPI)by provin
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ProvinceDistrictLiveexpectancy(year
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ProvinceDistrictLife expectancy(yea
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8Gender Development Index (GDI)by d
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ProvinceDistrictProportionof popula
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9Gender Empowerment Measure (GEM)by
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ProvinceDistrictParticipationof wom
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ProvinceKabupaten/KotaDistrictParti
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ProvinceKabupaten/KotaDistrictParti
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ProvinceDistrictPeople notexpected
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ProvinceDistrictInfantmortalityrate
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ProvinceDistrictSchool Participatio
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ProvinceDistrictHouseholds withacce
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ProvinceDistrictReal per capita GRD
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ProvinceDistrictLabourforceparticip
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ProvinceDistrictDevelopmentexpendit
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Computing the indicesThe Human Deve
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Calculating the HDIThis illustratio
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Calculating the GDIAs an example, t
Page 215 and 216:
Definitions of Statistical TermsAcc
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School drop-out rate: the proportio
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