2016 Ramon Magsaysay Awards: Indonesia’s ‘wallet of the poor’ helps uplift lives
MANILA, Philippines - In 1993, Parni Hadi, editor-in-chief of the Indonesian newspaper Republika, met social volunteers in Yogyakarta who worked with minimal support and promised to do something for the poor when he got back to Jakarta.
“That was the inspiration” for Dompet Dhuafa, meaning “Wallet of the Poor,” according to the organization’s president director, Ahmad Juwaini.
DD was elected to receive this year’s Ramon Magsaysay Award for redefining the landscape of zakat-based philanthropy in Indonesia, unleashing the potential of the Islamic faith to uplift,
irrespective of their creed, the lives of millions.
Zakat (charity) is a cornerstone of the Islamic faith. It is the obligatory tax on an adult Muslim’s wealth that is dedicated every year to helping the poor and needy. In Indonesia, which has the largest population in the world, the projected zakat collection was $28 billion in 2015 – or three percent of the country’s gross domestic product – giving it a huge potential for wealth distribution and social amelioration.
However, only 10 percent of the zakat gets collected because its collection, management and use have long been stymied by inefficiencies, corruption and abuse. The government has worked to regulate zakat management but anxieties remain due to questions on transparency, accountability and effectiveness in serving the poor.
Hadi started a modest zakat collection drive among the newspaper’s employees after the Yogyakarta trip and the article about the project came out in a small column of the newspaper on July 2, 1993. But Ismail Agus Said, DD’s president, said it was noticed by the readers and they started donating, along with the general public.
“That is why we dedicate this award to journalists,” Ismail said, noting how media could work hand in hand with the people to help the poor. He said they learned that the Ramon Magsaysay Award Foundation had been looking at DD as one of the possible awardees early on and they were very happy that their hope to be chosen was realized.
Ismail and Ahmad told The STAR in an interview at the Ramon Magsaysay Center in Manila that the organization introduced a new model or innovation in zakat management as it grew phenomenally from having a mere $213 collection in the beginning to become the largest philanthropic group in Indonesia today, with donations reaching more than $20 million last year.
Both were successful individuals in the private sector in Indonesia who decided to join DD for a sense of purpose. Ahmad described their organization as results-oriented and had been focused on making their beneficiaries “self-reliant.”
“This is our tradition and our culture since 1993,” Ahmad said.
Ismail explained they were running DD professionally and based on international standards, managing the funds through the banking system, including the use of automated teller machines and the Internet.
“Every month we send a statement to donors that we received the money. Also, when we distribute the money through the program... if necessary, we invite the donors to see what happened in the field directly,” Ismail said.
And every yearend, Ismail disclosed that they would send financial statements audited by public accountants to donors not only in Indonesia but other multinational companies around the world to make them see where their money went.
Trust in the organization is very important, both Ismail and Ahmad said, underscoring the beauty of having an open management system for charitable institutions. They share their experiences with other groups, they said.
Now independent of Republika, DD provides economic assistance, health services, education and training and other social development projects to “empower” the people.
DD’s economic projects included building public facilities, support for small and medium enterprises, farm production and marketing assistance, a bank providing preferential loans to the poor and a training-and-support program that upgraded the capacities of hundreds of microfinance groups in Indonesia.
In the health sector, DD has established free clinics and a free, well-staffed and well-equipped hospital for the poor that is the first of its kind in Indonesia. In education, the organization supports 400 poor university scholars, runs a free boarding high school for poor but deserving students and operates a teacher training school, as well as a vocational and entrepreneurship center that trains a thousand people each year.
Ahmad said DD had been employing careful selection processes for the beneficiaries and those who would manage the organization.
“We have many volunteers working in rural areas,” Ahmad said, referring to 10,000 individuals who willingly became part of DD that had served 13 million beneficiaries as of 2015. Twelve percent of the beneficiaries have moved out of poverty.
DD has offices in 12 Indonesian provinces and five foreign countries, employing 200 people.
“With the public trust it enjoys and its work in supporting other zakat organizations, DD continues to raise the level of zakat donations to Indonesia. But just as important, it has widened the space and opportunity for Indonesians, through the zakat, to become good Muslims. It has created as well an inspiring model, for other nations and religions, of disciplined, sustainable faith-based development,” RMAF said.
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