CPAN at the UN EGM on Strategies for Eradicating Poverty to Achieve the SDGs

I’ve just been at an expert group on the eradication of poverty at the UN down in the bowels of the HQ building in New York. The meeting was to identify ‘innovative’ strategies to eradicate poverty. The programme and papers given are here.

The meeting harked back to the commitment of the 1995 Copenhagen Summit to eradicating poverty which preceded the MDGs, and tried to absorb some of the lessons of the MDGs. Now, with the SDGs, eradicating poverty is placed together with putting planet on a sustainable path, the two objectives often seen as potentially conflicting…but there will be a high level political forum in July each year to review progress. In 2017 the HLPF will review progress towards poverty eradication and related goals, which creates a basis for setting a policy agenda for poverty eradication at inter-governmental meetings in 2018.

This meeting was to provide inputs (an 8500 word report) to the Secretary-General’s report to the Commission on Social Development, which is one of the UN’s inter-governmental bodies which advises the UN Economic and Social Council. The 2017 CSD will review progress, and service the HLPF. The 2018 meeting will set policy, again servicing the HLPF. This is convoluted, but that’s how the inter-governmental process inches forwards.

There was recognition of the uneven achievements of the MDG era, its unfinished business, and the need for policy innovation and political commitment if the SDGs, and SDG1 in particular, are to be achieved while leaving no one behind and raising the consumption floor. Status quo policies might ‘with luck’ (high growth and no increases in inequality) get near to zero extreme poverty by 2030, but policy reforms and innovations were thought likely to be necessary, especially given the poor state of policy frameworks in twenty or so countries accounting for a large proportion of the extreme poor, many of which are also not growing very fast.

In terms of substance, there was a big emphasis on job creation, linked with social protection; on removing biases against the poor (eg in taxation and public expenditure combined), as well as support for smallholder agricultural development. There was acknowledgement of the importance of outreach of education and health services to the poorest, but less discussion of how this could be achieved – examples of anti-malaria insecticide treated bednets was one; early childhood education, and pedagogical reforms focused on teaching children at the level they are at, rather than at an age-appropriate level: but it was also agreed this would require significant additional education expenditure and inputs in many situations.

My input was to remind the meeting that a dynamic perspective on poverty can improve policy making, and that of the three legs of poverty eradication – tackling chronic poverty, stopping impoverishment and sustaining escapes from extreme poverty – stopping impoverishment was somewhat neglected by policy making. As part of this, there is little realisation that ‘transitory poverty escapes into poverty occurs on the scale it does – 9 – 15% of rural or national panel survey populations in Bangladesh, Ethiopia, and Uganda in recent CPAN work, and as demonstrated in the 2014-5 Chronic Poverty Report (Chapter/page reference). And there are few policies to address this issue.

Also to show how CPAN is developing the concept and understanding of pro-poorest growth and to invite participants to work with us on this for the next Chronic Poverty Report. The premise is that the poorest people will need to participate in growth on good enough terms to enable them to escape and stay out of extreme poverty if SDG 1 is to be met. The cost and political difficulty of doing it all through redistribution makes it imperative.

Miaojie Yu  contributed a fascinating analysis of China’s industrial upgrading based on comparative advantage and its contribution to poverty reduction, following the first agrarian phase of reforms which did a lot of the ‘heavy lifting’, and a discussion followed later about the lessons which other countries could possibly learn from China, which seems such a unique case: these were its early emphasis on human development, especially quality education, so important in the modern world of rapidly shifting labour markets – though arguably any education is still better than none; and Yu said that too much education could be risky if there were not jobs to match. What China really got right was sectoral priorities. It had to start with smallholder agricultural growth because of its food crisis, but also invested in ‘Town and Village Enterprises’ which provided nonfarm rural employment and helped improve returns to labour and household incomes. Then came labour intensive industrialisation and associated massive internal labour migration, followed by rapid industrial upgrading and services growth over three decades, with engineering products becoming increasingly important in the industrial mix. By comparison some other countries industrialised too quickly, and ignored smallholder agriculture.

Redistribution is still important, and another insightful presentation by Nora Lustig was on the equity of tax and public expenditure combined, and the very different results which could be achieved in terms of impacts on the poor. In particular, how tax and spend outcomes can be and sometimes are impoverishing – and the need to carry out careful assessments of tax reforms to work out whether they will be impoverishing and for whom.

As is frequent now at such meetings there were plugs from organisations proposing single solutions or approaches (BRAC’s ultra-poor graduation programmes, J-Pal’s randomised control trials (RCTs), the Rabo Bank’s support for smallholder agriculture), but also lots of discussion about how no single solution exists, it’s always about combinations and sequences, though these can be hard to pin down.

For example, at a macro level, the East Asian development model emphasised education in the 1970s and 1980s, and massive investments in health and social protection came much later . In other regions investments have been more balanced, and in the international community the bias may even have been to health since 2000, with one massive vertical health programme after another. Education may well be the more fundamental investment in terms of sequencing – and the need for quality education, smaller class sizes, better teachers and infrastructure is now widely acknowledged.

On the other hand our own poverty dynamics work shows how ill-health impoverishes and causes transitory escapes when combined with other household or community level shocks. So  having at least a modest but effective curative and preventive health service is definitely imperative to avoid the major global cause of impoverishment. I don’t think all the international programmes help very much in that. Much better to support improvements to the whole system – I think this is now recognised, and built into the vertical programmes, but they are still the international community’s major instrument for supporting health services.

As a footnote, it still amazes me how RCTs have taken over the knowledge generation process. It’s an admirably rigorous approach, and has succeeded in getting evidence into programming with new force. However, it is limited in its application, and the point was made repeatedly that it is only one tool in the policy evaluator’s toolkit.