2010 A Year of Innovations in the Global Poverty Reduction Agenda

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1 2010 A Year of Innovations in the Global Poverty Reduction Agenda by Timo Voipio, Senior Adviser for Global Social Policy, Ministry of Foreign Affairs, Government of Finland and Chair, OECD DAC Povnet. Contact: timo.voipio@formin.fi and Gabriele Koehler, Development Economist and Visiting Fellow, Institute of Development Studies, Sussex. Contact: office@gabrielekoehler.net 2010 has been a remarkable year. There is triumphalism around the perception of a quick recovery from the 2008/9 financial and economic crisis a triumphalism which focuses blindly on GDP growth and is oblivious to the catastrophic levels of old and new unemployment. There are major policy regressions: many countries are reverting back to severe austerity programmes or fiscal consolidation as it is now called pushing through massive cuts in social expenditures, especially in countries across Europe, and thus further increasing socio economic divides. At the same time, however, as a notable countermovement, we see seven policy innovations on the global poverty and social justice agenda. They largely have their origins in and major momentum from the South. These seven innovations include 1) the attention now devoted to employment in the form of proactive labour market policies and significant public works schemes at country level, such as the NREGA in India, and the Global Jobs Pact for decent work and employmentoriented recovery at the international level; 2) the push for universal social protection, with a global social protection floor movement spreading across Africa, Latin America and Asia, which is supported conceptually and with funding by the entire UN system; 3) recognition of the debilitating impact of social exclusion and inequality on poverty, human development and the individual MDG targets with much more focus on equity, inclusion, social investment and social integration policies; 4) the attention to preventable infant deaths and the interventions to save lives of mothers and their babies with a set of simple and cost effective methods, and a major funding push at national and international levels, 5) a more sensitive eye on the economics and politics of care, 6) a nascent attention, after decades of neglect, of the need for accelerated and transformative agricultural and rural development, including green growth and pro poorland reform; 7) as an umbrella for all of these: the emerging convergence around a rights based approach to the Millennium Development Goals. The emergence of the decent work agenda employment cum social protection is perhaps the most coherent and encouraging among these shifts. This shift is observed in 2

2 many countries of the South including among the emerging middle income economies such as Brazil, India, China, South Africa, Thailand, the Philippines. It is also observed in many least developed countries which used to think that a role for government in generating decent work or in social transfers were beyond their reach; examples include Nepal, Cambodia, Ethiopia, Lesotho, Uganda and Zambia. This trend has been mirrored in the development agencies: The European Commission, UNRISD, UN DESA, UNDP, UNCTAD, UNICEF, ILO, ISSA and many international organizations and bi lateral development agencies have recently published major reports and policy agendas with decent work and social protection as one of the key strategies for reaching MDGs. As all these analyses show, employment and social protection are inextricably interlinked. Decent work is the most reliable form of social protection for most people who are able to work. But in all societies at all times there will be people who are too old, young or ill to reduce their poverty by their own work. The availability of reliable social protection systems for the inactive population greatly influences the economic choices and strategies of the women and men in active ages. The fact that an increasing number of development agencies and governments are now considering full productive employment as a key objective of their macro economic policies is a trend that has gone relatively unnoticed but that can be considered a major innovation if it becomes the mainstream policy approach. A recent Inter Agency Meeting of the major multilateral agencies already recommended a shift from inflation targeting to employment targeting of economic and social policies. Thus, the global jobs pact and the global social protection floor are becoming common currency. The global jobs pact calls on governments to put decent work opportunities at the core of their responses to the economic crisis. It has outlined a set of job centred policies for countries to adapt according to their national needs and recalls that respecting fundamental principles and rights at work, strengthening social protection, promoting gender equality and encouraging voice, participation and social dialogue are critical to recovery and development. It proposes a portfolio of policies aimed at: Generating employment Extending social protection Respecting labour standards Promoting social dialogue Shaping fair globalization ( en/index.htm). Social protection in the forms of social insurance and social assistance can be corroboration to the policies for jobs and decent work. A reliable universal social protection floor for all citizens can transform socio economic insecurity. It can provide the means to ensure access to health services as well as to social assistance in the case of accident, sickness, disability or old age and thereby promote socio economic security and predictability. Moreover, it can unlock the human capabilities and entrepreneurship of millions of poor people. People will dare to take initiative and risks in their income generating activities today, knowing that if the venture fails, reliable last resort support will be available from social protection to make sure that the family will not go hungry next week and the children need not drop out of school. Social protection is not only a human right, there are also Keynesian aggregate demand 3

3 arguments for such investment into people, as social transfers can increase household consumption, and if sufficiently generous and sustained, can generate incomes, and even investment. These two innovations employment and social protection certainly mark a policy or Zeitgeist shift. In the year 2000, when world leaders agreed on the UN Millennium Declaration and in 2001, when they agreed on the MDG Roadmap, employment and social protection did not even find a footnote mention. In 2010, at the UN General Assembly MDG high level panel of September, world leaders agreed that promoting employment and creating or deepening national social protection are essential for MDG progress. Similarly, the G20 Leaders Declaration (November 2010) recognized the importance of addressing the concerns of the most vulnerable by providing social protection and decent work in low income countries. The African and European Heads of State, representing more than 1.5 billion citizens at the AU EU Summit in Tripoli in November 2010, committed themselves to the promotion of the Global Decent Work Agenda, with a special focus on more, more productive and better jobs, and the link to social protection. The African Ministers of Labour and of Social Development in their recent meetings in Yaounde and Khartoum, respectively, emphasized social protection. The Yaounde Tripartite Declaration of governments, employers organizations and trade unions recognized the urgent need for all African Member States and Social Partners to start the effective and rapid implementation of a Social Protection floor to all Africans. The African Social Ministers emphasized social protection as one of the four key functions of the African Social Policy Framework Implementation Strategy the other three functions being production, reproduction and redistribution. The African Development Bank (AfDB) is developing an AfDB Social Protection Strategy in order to use social protection instruments for: (a) income poverty and risk vulnerability reduction in Africa; (b) national capacity building; and (c) enhanced food security. In the Asia Pacific region, the APEC Social policy ministers adopted an Action Plan on Employment in October 2010, noting that across our economies many labour market concerns remain, such as jobless growth, persistent unemployment and underemployment, increasing numbers of discouraged workers and widespread informal employment. Similarly, the European Report on Development 2010, the flagship report of the European development cooperation system is entitled Social Protection for Inclusive Development: A new perspective of EU cooperation with Africa. A forthcoming EU Guideline on Social Transfers in the Fight against Hunger emphasizes that global food security can never be achieved only by increasing agricultural production: Too many people in the world are food insecure because they do not have enough incomes to buy food. This shift is very much led by the insight innovation number three that income, wealth and asset inequalities have been increasing in and among countries, and that social exclusion and intersecting inequalities systematically and structurally undermine MDG achievement, which is deceptively smooth at the aggregate level in many countries, but riven by huge divergences along gender, ethnic, language and urban rural divides once one looks below the surface (Kabeer 2010; UN DESA 2010). To address this, policies are needed for employment, social protection, affirmative action and genuine empowerment, to create structural change towards eradicating poverty (UNRISD 2010). 4

4 In line with the attention to social inclusion and social justice is the renewed commitment to accelerate action at all levels to prevent infant deaths and loss of human potential in early childhood development. The bulk of under five deaths occur just before and in the first month after birth, and are due largely to infections and diarrhea, and to the poor nutrition and health status of women and girls who often become mothers far too early. Many of the interventions that would make a fundamental difference are possible even in difficult circumstances; others require a fundamental change of mindset around the rights of women and girls the former received a push with new national and international level grants; the latter requires continued forceful advocacy and affirmative action, to expedite behaviour change in households, communities and societies. As ever before, the World Bank still hesitates to speak about human rights. Yet, the rights of children come out strongly in the World Bank s work on early child development, where they make the case for generous enough investments into children and youth as good policy and smart economics. This relates to an emerging more sensitive focus on the economics and politics of care, on which one of the best discussions ever can be found in the new UNRISD Flagship Report on Poverty and Inequality. The care economy is generally poorly understood and under valued in the GDP dominated monitoring frameworks of socio economic progress. The care sector is also plagued by systematically unrecognized or underpaid work, with those who provide care services coming generally from groups who are marginalized in the household, in society, in their respective countries, and in the global economy. Care work needs to be valorized, and where it is market based, needs to be formal in terms of salary and pension and health insurance benefits for the care workers themselves and properly paid. This is where there is are important direct links between the decent work and social protection floor agendas, the attention to equity and inclusion, and the rights of children and women. There is also a new attention to the rural economy, and some policy searching into the need for fiscal reforms. Innovation number six is looking into technical issues around agricultural productivity, but also into political economy issues around land use, land tenure, the inequality in land ownership, green growth and off farm employment opportunities. The taxation discourse is looking into global taxes, and also into national tax reform to generate government revenues which would be more redistributive in nature taxes on assets and wealth, progressive income taxation, or cesses dedicated taxes and contributions to fund education, other child oriented expenditures and social protection. Interconnected, and corroborating these six innovations is the emerging trend for a rights based approach, witnessed at the international level by the very vocal human rights special rapporteurs on extreme poverty, right to food and other basic rights, or the recent adoption of a right to water. At the national level, rights based movements are strengthening. Prominent examples include the campaigns for basic income grants in South Africa, Namibia and Brazil, and the whole gamut of rights based programmes in India: the right to a school meal in all public schools (2001), the employment guarantee act (2005), the right to information act (2005), the right to social security in the informal sector (2008), and most recently the right to education and the right to food 5

5 (Koehler 2010). Interestingly, some of these seven innovations are but a reconfirmation of the initial development visions of the late 1940s. The right to decent work, adequate standard of living, and education, to social security are confirmed in Articles 23, 25 and 26, and 22 respectively of the Universal Declaration of Human Rights, adopted by the world community in was a year of remarkable conceptual insights and innovations in the global poverty reduction agenda needs to become the year when they are converted into tangible outcomes for social justice. Key sources and resources Human rights The Universal Declaration of Human Rights Office of the High Commissioner on Human Rights. Report of the Independent Expert on human rights and extreme poverty. UN Convention on the Rights of the Child. The MDGs and poverty UN Millennium Declaration 2000, UN MDG Roadmap, published by the UN Secretary General on 6 Sep, and UN General Assembly, 14 Dec (see: RES pdf ) UN MDG Review High level Panel Outcome Document G20 Leaders Declaration Nov 2010 media.seoulsummit.kr/contents/dlobo/e1._seoul_summit_leaders_declaration.pdf UNRISD. Flagship Report on Poverty and Inequality AFC AA7?OpenDocument UN Department of Econmic and Social Affairs (UN DESA) Report of the World Social Situation.. Rethinking Poverty. Kabeer, Naila (2010) 'Can the MDGs provide a pathway to social justice? The challenges of intersecting inequalities', Brighton: IDS. Koehler, Gabriele, Südasien: Ansprüche und Elemente von Wohlfahrtsstaatlichkeit? wwwedit.unibielefeld.de/soz/iw/publikationen/workingpaper_gk/wp_2010_05koehler_1.pdf OECD POVNET Guidelines: 6

6 Decent work and social protection APEC Action Plan on Employment: European Report on Development (ERD) 2010: on Social Protection in Sub Saharan Africa: erd.eui.eu/erd 2010/final report/ EU/AU Tripoli Declaration Nov ILO Social Security Report cation/wcms_ pdf ILO Guide: Extending Social Security: cation/wcms_ pdf ISSA Research and Policy Guide on Social Security Publications/ISSA Social Security Research and Policy Manual ISSA study on theextension of Social Security Coverage Focus/In Focus Extension of social security coverage/extension study. ISSA Strategy on Social Security Coverage Extension Events/News2/ISSA and ILO strategies for the extension ofcoverage and Reports/ISSA strategy for theextension of social security coverage Unicef work on child sensitive social protection: and _Africa_Parliamentary_Regional_Workshop_on_Child_Sensitive_Social_Protection).pdf World Bank: Investing in Children and Youth: Yaounde Tripartite Declaration on the implementation of the Social Protection Floor 7