ASEAN Beat | Society | Southeast Asia

The Trouble With Indonesia’s Dual‑Track Vaccination Scheme

The Gotong Royong plan for corporate employees will likely give rise to vivid perceptions among the public that the rich enjoy preferential access to coveted vaccines.

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The Trouble With Indonesia’s Dual‑Track Vaccination Scheme
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The COVID-19 pandemic has exposed social inequities worldwide, including in the administration of vaccines. Indonesia, however, stands out for a vaccination policy that deliberately accommodates – and indulges – the country’s most prosperous groups. A new health minister decree provides for two separate but concurrent vaccination programs, one for corporate employees and another for the remainder of the population.

As a country with a massive domestic population (exceeding 280 million), Indonesia possesses its own formidable vaccine-production capacity. It also has relatively strong capacity for carrying out clinical trials of new vaccines. Separately, its relations with China are growing ever closer. For these reasons, Indonesia has secured substantial supplies of raw materials for the Coronavac vaccine from China’s Sinovac. State-owned vaccine producer PT Bio Farma is under contract to “finish and fill” vaccines from ingredients supplied by Sinovac. Thus far, Bio Farma has received materials for 40 million doses of the two-dose vaccine, and is due to reach 140 million by July. Together with supplies promised from other manufacturers, including AstraZeneca and Novavax, Indonesia aims to inoculate 181 million citizens by year’s end. Some, however, are anxious to move faster.

In February, a forum of 100 corporate CEOs convened together with President Joko “Jokowi” Widodo and proposed an initiative for “Self-Supplied Vaccines,” dubbed Vaksinasi Mandiri in Indonesia. The CEOs, under the rubric of the Chamber of Commerce (Kadin), offered to handle the vaccination of their companies’ employees, along with dependents of employees, in exchange for the right to purchase and import vaccine supplies on their own. Against expectations, Jokowi approved the request and by the end of the month the health minister had issued a decree setting forth a regulatory framework for the arrangement. Kadin has registered over 8,300 companies for participation and it aims to purchase 40 million doses for 20 million recipients.

In the meantime, the Kadin program changed names to become Vaksinasi Gotong Royong. The new term refers to the traditional Javanese custom (gotong royong) of enduring poverty by pooling resources to share hardships. Ironically, however, this is precisely the opposite of such a scheme. It will enable the better‑off to protect themselves first, while leaving the community’s less-advantaged members behind.

Kadin members argue that swifter vaccination of the country’s formal‑sector workforce will bring about swifter economic recovery. In fact, overcoming the pandemic itself is actually the only way to ensure recovery – and this requires a focus on those who are most vulnerable and most exposed to transmission. In Indonesia, employees of corporations are substantially better off than the general population, with better health status and far better means to protect themselves through distancing and other precautions. Lower-income Indonesians typically live in cramped quarters and work in riskier jobs.

Kadin officials also argue that the organization’s willingness to pay for vaccines for its own members will alleviate the burden on the government, thereby freeing up resources for the national vaccination program. However, Finance Minister Sri Mulyani Indrawati explicitly stated in an address to foreign correspondents in February that “financing is not the main issue with vaccination” – rather, securing supplies is the main challenge, followed closely by the difficulties of overcoming logistics hurdles in the sprawling, tropical, and underdeveloped archipelago. Indonesia has benefited from generous fiscal support from international donor organizations and bilateral partners, raising ample funds and capital markets in a low-interest-rate environment. Indonesia’s government debt is well below 40 percent – low by emerging market standards.

For individual companies operating in Indonesia, registering with the Kadin program is advantageous, as it may indeed result in faster vaccination for the firm’s employees and dependents – especially if thousands of other companies are taking part. But for the country as a whole, achieving national coverage might have come about sooner by focusing on a unified nationwide program.

If Kadin members genuinely sought to accelerate Indonesia’s recovery, they might emulate the examples of several private-sector companies that are taking the initiative to assist the government with logistics. The ice‑cream maker Campina, for instance, is making its nationwide network of cold-storage units available for accommodating inventories of Coronavac; so too is the personal-care products distributor Unilever and others. The ride‑hailing service Grab opened its facilities in Bali to become Southeast Asia’s first drive‑through vaccination site.

Rather than alleviating a burden for the government, the Kadin program risks exacerbating matters. The proposal from the CEO Forum has already forced over-burdened policymakers to devote precious time and resources to the intricacies of planning a dual‑track program, rather than focusing exclusively on the hurdles to national vaccination. The new health minister decree reveals some of the complexities involved. Kadin vaccines must receive Emergency Use Authorization (EUA) from Indonesia’s Food and Drug Oversight Agency (BPOM), and these vaccines must be different from those used in the national program. And Kadin must adhere to ministry guidelines in administering vaccines and use only private‑sector clinics not taking part in the national program.

Kadin is supposedly alleviating burdens for the government – but, in fact, the needs of the business chamber pose significant impositions on finite public resources. The health minister decree assigns the task of distributing Kadin’s vaccines to PT Bio Farma – the very same company responsible for processing precious Coronavac supplies and fulfilling the demands of the national vaccine program. Shouldering responsibility for catering to Kadin may already be imposing a costly distraction on Bio Farma. The decree also tasks the Health Ministry – an agency that is struggling mightily to respond to the pandemic – with certifying the private clinics that will administer Gotong Royong vaccines to Kadin’s enrollees. The ministry must also manage a nationwide targeting and tracking system that accommodates vaccination data not just for its own program, but also for Kadin’s. And the government is also actively helping to supply Kadin: Coordinating Maritime Affairs Minister Lt. Gen. (ret.) Luhut Panjaitan visited China to beseech Sinopharm to prioritize its vaccine allocations to Indonesian corporations. This application of diplomatic resources with China might have gone to better use.

Meanwhile, the ministerial decree imposes virtually no prudential safeguards on the Kadin program, other than asserting that the chamber must vaccinate recipients free of charge. Neither the health minister nor other government officials have set forth mechanisms for monitoring the handling of Kadin vaccines – despite clear risks for abuse and malfeasance.

For Jokowi, the stakes are high. The Gotong Royong plan will likely give rise to vivid perceptions among the public that the rich enjoy preferential access to coveted vaccines. This exacerbates sentiment surrounding social inequities – at a time of crisis, when distress is already widespread – and it does so quite unnecessarily. Concentrating on one national program, which treats vaccination during a health crisis as a public good, would avoid confusion and inefficiency, likely bringing about recovery more swiftly. Even though Kadin must pay for its imported vaccines on its own, the business chamber is clearly receiving copious assistance already from the Health Ministry, state-owned Bio Farma, and ministers such as Panjaitan. This will inevitably fuel public perceptions that the rich are receiving preferential treatment denied to the poor. The perceived inequity could very well mar Jokowi’s long‑term political legacy.

More significantly, Kadin’s insinuation of its interests into national health policy poses risks for the country as a whole. In particular, if revelations emerge that Kadin is mismanaging Vaksinasi Gotong Royong, resulting opprobrium could damage not only the business chamber, but also the Health Ministry, the Jokowi administration and the president himself. As was the case in many countries, persuading the bulk of the public to participate in vaccinations is a challenge; a scandal that exacerbates cynicism and undermines confidence in vaccination is a threat to Indonesia’s overall recovery.

Kevin O’Rourke is writer and producer of the Reformasi Weekly Service report analyzing politics and policymaking in Indonesia. He is also the author of the book “Reformasi: The Struggle for Power in Post-Soeharto Indonesia (Allen & Unwin, 2002) and producer of the Reformasi Dispatch podcast series.