One consequence of Indonesian fiscal decentralization and regional autonomy is that local governments now have more responsibility to more participate in poverty alleviation programs. Providing better access for local public goods and services is one possible action from local governments in national poverty alleviation programs. This paper tries to propose a basic strategy for the role of Indonesian central-local government in poverty alleviation program that may proper to be implemented within the framework of Indonesian new government system after fiscal decentralization and regional autonomy. One important strategy proposed is role sharing and role switching between central and local governments in designing and implementing market and public-oriented policies. Since the stronger-need participation of local government in poverty alleviation may put local government’s fiscal condition in problem, the objective of wealth-neutral condition does need an appropriate cost-sharing system that will lead to the more financial and political fairness between Indonesian central and local government.

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