Poverty is a persistent problem throughout Indonesia. With decentralization, local governments had a new direct role in alleviating poverty and local wellbeing. At the same time they could do so in accordance with local realities and development needs. Yet, there is little improvement in the wellbeing of rural people. Local governments may lack the necessary capacity and experience to reduce poverty effectively. This report shows how a local specific monitoring system can be developed and applied. The results of its application in Malinau provides an indicative view of poverty and shows which aspects of wellbeing are in critical condition and where interventions are most urgently needed. The report analyses poverty causes and gives practical recommendations to help local government improve its development planning and poverty reduction.