IndII is currently in its second program phase, which will finish end-January 2017. The first phase of IndII was completed in June 2011 with a full wrap-up of the program at the Phase I Concluding Event. Click here to view a summary table of IndII phase 1 activities, and here for a summary table of planned activites in phase II.

Water and Sanitation Grants and Mainstreaming

photos water hibah program (water and sanitation grants and mainstreaming)IndII’s wter and sanitation program is undertaking the following activities in the area of water and sanitation grants and mainstreaming:

Water Hibah Program

The aim of this program is to support the Government of Indonesia’s (GoI) achievement of the 100-0-100 universal access targets, including improving access to services by poor households, a better fiscal transfer mechanism for water and sanitation funding, and better alignment of ministry roles and responsibilities with the GoI’s decentralisation policy. At the local government level, the program looks for evidence of cost recovery tariffs, greater commitment by local governments to apply local budgets to water sanitation infrastructure and services, and improved transparency in the use of funds by the water utilities - Perusahaan Daerah Air Minum (PDAM). In Phase 2 of IndII, IndII has oversight of A$80 million for Water Hibah grants in up to 129 local governments. In addition, IndII has implemented a USD 10 million program Water Hibah Program for 23 local government on behalf of USAID. The program included a baseline survey, conducted prior to implementation. To date the programs (DFAT, APBN and USAID funded) have benefitted 400,000 households in Indonesia. The water hibah program has resulted in greater use of piped water in the target population, increased investment by local governments in water supply infrastructure, and increase in household savings. 

Mainstreaming Hibah

The output-based water and sanitation hibah grant programs were so successful that the decision was made to mainstream the process into GoI’s centre-regional fiscal arrangements using Anggaran Pendapatan Belanja Negara (APBN)funds. The GoI has committed up to $1 billion from the national budget over the next five years for output-based water and sanitation hibah.IndII is providing technical assistance for the program. In the APBN Water Hibah program, IndII has conducted baseline surveys and verification in partnership with Directorate General of Human and Settlements (DGHS) in 117 local governments. In the sanitation hibah program, IndII and DGHS have worked together to conduct baseline survey and verification processes to support the program, which provide onsite sanitation facilities or septic tanks in 17 local governments. 

Sanitation Program: sAIIG and Sanitation Hibah

IndII is implementing two sanitation programs: Australia-Indonesia Infrastructure Grants for sanitation (sAIIG) and the Sanitation Hibah Program. The output-based Sanitation Hibah program provides incentives to 4 LGs who implement sewerage connections through its local sanitation agency; the total allocation for this program is A$5 million during 2016. 

The sAIIG program requires LGs to commit to a program of small scale sewerage development which is implemented directly by the LG and subsequently operated by a dedicated municipal sanitation operating agency. The LG is required to plan, design and implement the schemes and claim a grant based on the actual number of households connected. Initially the grant program provided $40 million for 40 LGs for an anticipated output of 90,000 household connections to new sewer schemes. So far grants have been awarded for schemes totalling 59,000 households in 38 LGs. Implementation by the end of 2016 is expected to be 22,000 households with commitments from LG to continue with the existing program. 

Both programs aim to stimulate local government investment in municipal infrastructure for sanitation, and to provide incentives for governance reforms to enhance the operational sustainability of their systems.