INDONESIA Culling Compensation Policy and Practice

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Jasmine Cox
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1 INDONESIA Culling Compensation Policy and Practice National Committee for Avian Influenza Control and Pandemic Influenza Preparedness (Komnas FBPI) 13 February

2 Chronology of AI in Indonesia Interpandemic Pandemic Alert Pandemic Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 Phase 6 June 06: Cluster, yet no sustain/efficient human to human As of 13 February 2007 Poultry: endemic in 30 of 33 provinces; no report in 10 provinces in 6 month Human cases: 83 confirmed including 63 deaths; 9 confirmed including 6 deaths in 2007; 78% of deaths in 3 provinces (Banten,, Jakarta, W. Java) July 05: First human infection confirmed Aug 03: First reported outbreak in poultry 2

3 Putting Together the AI Control Puzzle Culling and Compensation Key Pieces Human Surveillance Animal Surveillance Culling Vaccination Lab Diagnostic Epidemiological Studies Monitoring Compensation Capacity Biosecurity Public Information Social Isolation Quarantine Wet Market Poultry Sector Restructuring Antivirals Human Vaccine Clean-Up 3

4 Culling: Three Rules of Thumb Why to cull? What to cull? Where to cull? To reduce virus circulation and thereby limit spread among poultry, prevent direct human exposure, and mutation risks All confirmed infected and exposed poultry stocks. In areas where AI infections are detected and confirmed. SOP = 1 Km of active outbreak in endemic areas. 4

5 Poultry Population: 1.3 Billion Birds Compensation can get very expensive very quickly Sector 1 (Industrial integrated) Sector 2 (Medium scale) 80% poultry population Sector 3 (Small scale) Sector 4 (Backyard farm) 30 million households 20% poultry population 5

6 Extended Need for Compensation No chicken for 3 6 month after cull: Income loss? Employment for small scale farm? Farmers/poor house hold own consumption for egg and meat (protein intake)? Relocation of poultry farm and related activities? Improvement in distribution and retail system (slaughtering house, wet-market, etc). Cost? 6

7 Budget for Compensation Limited Two GOI budget sources DGLS annual budget: focal culling around active poultry outbreaks KOMNAS FBPI emergency budget: culling associated with human cases Amounts limited 2006 Rp 33 billion enough for about 3 million birds only 2007 Rp 15 billion from DGLS plus up to Rp 100 billion from emergency budget, if needed. Before 2007 no donor funding, 2007 yet to be cleared 7

8 Compensation Current Practice and Issues Who? What? Practice Farmers in Sectors 3 (small-scale) and Sector 4 (backyard) Culled confirmed infected and potentially exposed birds Issue No compensation for Sector 1 and Sector 2 Moral Hazard how to ensure compensation does not create disincentive for control No compensation for dead birds no incentive to report and dispose of properly. How Much? Originally Rp2,500 per bird Increased to Rp10,000 per bird Now up to Rp12,500 per bird Flat rate overcompensates for some types of birds and undercompensates for others Local market price differences - Java versus Papua 8

9 Compensation Funds Flow Complex and Slow *) 5 Cash Office (KPPN) 6 Payment Request (SPP-LS) Payment Order (SP2D-LS) DG Livestock Production Support (DGLS) If necessary, administrative and field verification 4 2 Request for payment of the compensation to the Budget Holder (KPA), cc to Provincial Dinas 3 Endorsement to the district request Provincial-level Livestock Agency (Dinas) Local Bank (Head of Dinas account) 7 Reimbursement District-level Livestock Agency (Dinas) 1 Local Government pre-finances compensation payment Poultry Farmers Note: Steps 3 (endorsement) and 4 (verification) are not stipulated in the Decree (but are based on presentation provided by DGLS). Related with greater budget and financial system 9

10 World Bank Support for Improved Compensation System $ 3 M over two years (AHI Facility Grant) $0.3 M to design improved culling compensation system draw lessons from other compensation systems and Indonesian experience with cash transfers Pilot project : $2.5 M Compensation Fund and $0.2 M operating costs to implement improved system in 6 districts 10

INDONESIA S RESPONSE TO AVIAN INVLUENZA (October 7, 2005) A. Assessment of Key Areas of the Country s Overall Preparedness

INDONESIA S RESPONSE TO AVIAN INVLUENZA (October 7, 2005) A. Assessment of Key Areas of the Country s Overall Preparedness A.1 Current status of HPAI in Indonesia Since the first reported outbreak in Indonesia