ProPoor Spending in the Human Development Sector

1
Pro-Poor Spending in the Human Development Sector

• Mukesh Chawla
• ECSHD

2
Where is the government?

• Poor people in Ghana named institutions that are
  important in their daily lives. These are
• Assemblymen
• Chiefs
• Churches
• Where is the government?
• Source Voices of the Poor 2002

3
In theory.

• Public spending should promote efficiency (by
  correcting for various market failures) and
  equity (by improving the distribution of economic
  resources)
• Dominique van de Walle, 1995

4
.but the evidence is

• Why ask the village self-governance authority,
  regional administration or state administration
  for help when they live at our expense,
  collecting taxes? When we apply to them they tell
  us there is no money, yet at the same time they
  build themselves houses, buy imported cars, and
  the like.I do not trust them
• - A refugee from Tash-Bulak, Kyrgyz Republic
  Source Voices of the Poor 2002

5
In theory

• Intervention justified on grounds of improving
  distribution
• There are few other instruments that can do the
  same
• Informational constraints in the market
• Etc.

6
and evidence

• We hear the government introduced free primary
  education and provides for all essential
  requirements, notebooks, pens and pencils The
  pupils have never received these items.
• A group of women in Kuphera, Malawi
• Source Voices of the Poor 2002

7
Targeting the poor

• The term targeting in eradicating poverty is
  based on an analogy a target is something fired
  at. It is not altogether clear whether it is an
  appropriate analogy.
• Amartya Sen

8
Critical questions for all HD work

• How much of public spending really goes to the
  poor?
• How much do we actually worry about service
  delivery issues?
• How central is incidence analysis to our work?
• To what extent is our lending program based on
  our understanding of the above?

9
Mixed bag..

• Some analytical work does have a marked pro-poor
  focus, much does not
• Some regions seem to worry more about such issues
  than others
• Some projects are based on evidence of the state
  machinerys capability, many are not

10
How does one explain this?

• Tendency to concentrate on public expenditure
  management, fiscal discipline, financial
  analysis, procurement issues, etc.
• Tendency to concentrate on resource mobilization
  instead of resource allocation
• Tendency to think in silos

11
Some real difficulties

• We dont really know much about allocating
  resources across sectors
• Within sectors also, not obvious what the right
  tools are and what they actually measure
• Data problems

12
..and some not so real

• Much analytical work PREM-driven and often guided
  by other priorities
• HD sector staff overwhelmed with project-related
  work
• Widespread belief that performance is judged by
  the number of projects taken to the Board
• Oversight (QAG, managerial, etc.) variable

13
Still lots of good examples

• Indonesia (2001) on public spending for education
  and health
• Vietnam (2000) analyzing pro-poor bias of public
  spending
• Georgia (2002) drawing on incidence analysis from
  poverty study
• Slovakia (2002) based on study of Roma population
  and poverty analysis
• Karnataka (India, 1997) using utilization
  disaggregated by quintile groups

14
Before we get complacent..

• Poverty results in suicide, hunger, death, lack
  of money, lack of hope. Things are getting worse
  every day. People are afraid of starvation, lack
  of heating, ethnic unrest. People bite one
  another like dogs
• Voice of the Poor from Kyrgyz Republic

15
Moving forward

• Analytical tools to evaluate impact of public
  spending on the poor
• Define effectiveness as an intersection of
  incidence (or spending per person) and
  utilization (or consumption per person)
• Mandatory review of capacity and capability of
  pro-poor public spending
• Establish measurability criteria and link with
  lending