“If you had to identify the three main policies that you consider key in eradicating extreme poverty, what would they be?” This question was asked to Andrew Shephard, CPAN’s Director, during the presentation of the 2014 Chronic Poverty Report at the DAC Development Debate in Paris last 15 April. To answer Erik Solheim’s question, DAC Chair, and in line with the Chronic Poverty Report 2014, Andrew identified the three main policies that can challenge chronic poverty, stop impoverishment and sustain escapes from extreme poverty:
1. Huge investment in education – to improve the standard of living of the poorest. A massive investment in education would allow at least one or two children in each poor household to go to a good quality school for around 10 years. Such approach enables household escapes from poverty, sustains the climb away from it and education also has the advantage of being a ‘portable asset’ that is resilient to crises. In terms of interventions, it would imply investments in pre-school and linking those who complete school to the labour market, as well as quality improvements in primary and greatly expanded access to secondary schools.
2. Social assistance – to provide a safety net for the poor. Such policy brings the poorest people closer to a decent standard of living, provides a safety net for them in tough times, and encourages them to make the investments and take the risks that could not only propel them out of poverty but also keep them out of poverty. Extending protection to the vulnerable non-poor will also dramatically reduce impoverishment rates.
3. Economic Growth which benefits the poorest – creating national prosperity which is genuinely for all. This involves a bundle of measures to support pro-poorest economic growth (PP²G): investing strongly in smallholder agriculture and in policies to improve the quality as well as the number of jobs created, especially in the informal sector, where most poor people work.
As the Chronic Poverty Report 2014-5: the Road to Zero Extreme Poverty remarks "The poorest people often lack the skills, education or assets (such as land) to keep their heads permanently above the poverty line and are very likely to remain poor if they are hit by shocks such as illness, unemployment, old age, a disability, extreme climate events, or conflict.” These three sets of policies not only enable poor people to cope with shocks but also provide the poorest with the resources and an enabling environment that can help them escape and stay out of poverty. Additionally, other priority policies will be needed in each country context – the menu of these is laid out in the Chronic Poverty Report.
Of these three policy areas, pro-poorest growth is least well understood in most countries. CPAN has a work stream which tries to identify the policies which will enable the poorest to benefit from growth. Policy guides on agriculture, energy, employment, middle income countries, financial inclusion, and private sector development have been produced; a guide on macro-economic policy is underway, as is research comparing growth performances in Southeast Asian and East African countries. The intention is to write a fourth international Chronic Poverty Report on pro-poorest economic growth in 2016.
We would very much like to hear from policy makers and researchers engaged in including the poorest people in growth.
The presentation of the 2014 Chronic Poverty Report at the DAC Development Debate is one of the several presentations taking place in 2015, which indicates the continued level of interest in this publication. The 2014 Chronic Poverty Report was also ODI’s most read report of 2014.