IPR Blog

Expert analysis, debates and comments on topical policy-relevant issues

Shared prosperity and protest

📥  Brexit, development, EU Referendum, Trump

Professor James Copestake is Professor of International Development at the University of Bath, as well as being a member of the IPR Central Team and Director of Studies for the Professional Doctorate Programme (DPRP).

Donald Trump’s victory in the USA earlier this month coincided with a campus lecture here at Bath from Kaushik Basu, who played a leading role in the World Bank’s decision to add shared prosperity to its mission statement alongside the already established goal of absolute poverty reduction. Defined as growth in the income of the poorest 40%, shared prosperity is not in itself a measure of inequality – but it does invite comparisons with how their income growth compares with that of others in society. It also echoes the attention being paid under the UN’s new Sustainable Development Goals for 2030 to “ensuring that no one is left behind’ (the Republic of Uganda, for example).

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That said, many people living towards the bottom of the economic pyramid are likely to regard such worthy statements as at best irrelevant, and at worst fodder for the expensive bureaucratic ‘system’ for centralising power and promoting the global free markets through which they were marginalised in the first place. This takes us back to Trump, to Brexit and, most likely, to further political protest movements and ‘surprise’ votes. If so, then rising demand for better evidence of who is benefitting most from economic growth looks set to continue. Here are three examples of literature to watch.

First, there are 'Kakner-Milanovic global growth incidence curves', also known as Elephant Diagrams. Integrated global versions reveal rising shares of growth among world income deciles from 0% to 60%, high growth for the top 1%, and a stagnant trough of disaffected poor-to-middle class voters in between, mostly living in richer countries. This suggests that we should not be surprised to see more news stories that reverse the polarity of neo-liberal versus protectionist debate between the global north and south.

Second, there is the P20 initiative to monitor the poorest 20% of the world’s population: who they are, how they are doing, and where they are. Three-quarters of them currently live in just nine countries – India, China, Bangladesh, Nigeria, Indonesia, DR Congo, Ethiopia, Pakistan and Tanzania. Hoy and Sumner argue that other people in these same countries are now rich enough to transfer the simplistic sums necessary to eliminate this poverty – through a mix of higher taxes and shifts in funding from military spending and regressive fossil-fuel subsidies, for example. This is likely, in turn, to fuel renewed demand for incorporating estimates of countries’ relative tax effort into aid allocation.

Third, there is more nuanced political economy analysis of the causes and consequences of unequal shares in income growth. Take Ethiopia. Its government has been impressively successful over the last two decades in both promoting economic growth and channelling it into poverty-oriented activities, including rural roads, agriculture and social protection programmes. A symbol of its economic success is the construction boom in Addis Ababa and other prospering centres, and the rising property prices and rents anyone fortunate enough to own or acquire land there can enjoy. But investor confidence behind this model is threatened by protests linked to perceived horizontal inequality of access to these windfalls between different regional/linguistic groups. In short, if economic growth leads to rising inequality, political intolerance of the same will sooner or later threaten to hold it back.

All this suggests that indicators of shared prosperity (equitable or otherwise) are of interest not only to academics, researchers and development bureaucrats, but also to politicians, investors and activists – particularly to the extent that they can be disaggregated not only by income but also by class, ethnicity, gender, region, religion, disability, age and their intersections.

You can read more about Kaushik Basu's visit, his lecture and the conferment of his honorary degree here.

 

 

From Foucault to Valls: experiments with basic income in France

📥  universal income

Dr Susan Milner is Reader in European Politics at the University of Bath.

In line with changes discussed in the British context, it is startling to observe how much has shifted in French policy debates since the last presidential and legislative elections in 2012. For over two decades now, as in other OECD countries, the twin discourses of welfare dependency and ‘making work pay’ have dominated public debates. In the US presidential elections, the rhetoric of ‘decent jobs for decent pay’ was powerfully articulated across the political spectrum. It has not (yet?) made its way across the Atlantic. Instead, amidst the tumult of primaries as the political parties gear up for next year’s executive elections, the idea of a universal basic income has been making its way across the political landscape in France.

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The idea has a long pedigree in France where it is associated with radical thinkers such as Michel Foucault who argued that an unconditional basic income would free citizens from the intrusion of state power and the stigmatisation of means testing and conditionality. Philosopher André Gorz also advocated a ‘revenue of autonomy’ back in 1983, first linking it to the need for recipients to engage in work as a precondition for active citizenship, then later - in 2002 - abandoning this link to employment in the face of mass unemployment, and as a reaction against the spread of ‘workfare’ conditionality. Gorz’s ‘farewell to the proletariat’ (physically productive paid work as opposed to brain work) was in line with this new left utopia, and it chimes with the current mood of political debates which have been sparked by concerns and hopes about the consequences for human employment of developments in artificial intelligence.

Equally startling is the observation that the idea has gathered new converts across the political spectrum. The ruling French Socialist Party has been relatively slow to welcome it, and the mainstream right has, up until now, been mostly hostile. The conversion of key politicians on both wings has reopened debates. In the Socialist Party, universal basic income has gathered support recently from would-be leaders on both the left and right wings. On the centre-right, François Fillon - its most notable proponent - made a surprise breakthrough in the first round of the primaries on Sunday.

However, as Luke Martinelli pointed out in his IPR blog, behind the apparent consensus lie some fundamental differences which need to be acknowledged and explored if the debate is to develop meaningfully. A report by the Fondation Jean Jaurès, a think tank with close ties to the ruling French Socialist Party, identified at least three approaches to universal incomes, with a fundamental divide between libertarian-right and ecologist-left versions based on whether a universal income should be residual subsistence-level or generous enough to allow individuals to live decently without any need for paid work.

Most proponents among the contenders on the centre-right propose pegging the rate at €450 per month, which is far from the conditions of autonomy espoused by Gorz or Foucault. Some of the (less prominent) politicians in the Les Républicains party have suggested a rate almost double that, at €800 per month, which is the rate around which support in the Socialist Party seems to be gathering. However, among the more likely winners of the forthcoming primary on the right, support for basic income has been at best lukewarm - and has been based on the assumption of rates lower than current benefit levels. Mr Fillon, tagged as an economic liberal and social conservative, espouses a low-level basic income as part of a general push to lower welfare spending.

A recent Senate report modelled three levels: €500 per month (the level of the current minimum income, revenu de solidarité active (RSA)), which could potentially be topped up by existing state pensions but no other benefits; €750 (the absolute poverty threshold); and €1000. Whilst the first two would save money for the state, the third would require further funding to the tune of €153 billion. The rate of €750 per month, with an additional €250 for pensioners and €250 per child to families, is the most widely advocated option - the ‘most realistic utopia’ for the authors of the Fondation Jean Jaurès report.

This specific difference concerning income levels raises a wider question about the motives for adopting a basic income. Several politicians on the French right have been explicit in advocating its adoption as a way of saving money for the state by reducing benefit levels. The result would almost certainly be a rise in levels of poverty risk, which France has so far been relatively successful in containing, at 12.1% of the total population in 2014 compared to 16% in the UK.

Existing social transfers significantly attenuate poverty in France: before social transfers the at-risk-of-poverty rate is around 22%. However this does not mean that it is efficient: as well as the stigmatising effect, the social safety net has several large gaps, particularly around young people (who are not eligible for the RSA and who have a poverty rate of 18%) and single people, as the transfers are skewed towards families with children. The RSA is a particularly unloved benefit, as it falls short of a universal basic income and, with its plethora of conditionality rules, has become complex to administer and to claim, with little impact on employability.

A final area of uncertainty, and therefore of political debate, concerns the impact of universal income on low-paid work. The late sociologist Robert Castel, a leading scholar of social exclusion who was one of the first to theorise the ‘precariate’, excoriated the RSA for providing insufficient resources to the poor whilst at the same time encouraging low-paid, low-quality jobs. Poverty concerns, he argued, have to be raised in the context of a wider discussion about the quality of work. In the current French political debates, the universal income proposals assume that they will be widely topped up with low-paid work. Moreover, contradictions with the post-work utopia are simply sidestepped.

Almost entirely absent from the current debates is any sense of the material needs of individuals claiming universal benefits, apart from low-income pensioners. There is no discussion of how universal benefit would affect families, or people with physical or mental disabilities, who may be cumulatively disadvantaged if a universal benefit is used to shrink the state in terms of its services as well as its cash transfers. There is no modelling of how benefits interact with consumption needs, particularly housing. Unless these fundamental questions are posed and answered, the current debates could end up instrumentalising the concept of a universal basic income without resolving the problems which sparked them in the first place.

To help answer some of these questions, the new interest in universal incomes has at least had the effect of stimulating investment in local experiments. In the Gironde department, a universal income will be administered by amalgamating existing benefits for the poorest. This French experiment will be much closer to a universal citizens’ income model than the Finnish and Dutch initiatives which will take place at the same time, and which are explicitly aimed at integrating recipients into the labour market. It also has the novel addition of a citizens’ panel which will form part of the evaluation process. The Gironde experiment has already caught the attention of the Prime Minister Manuel Valls and served to re-ignite the interest of presidential hopefuls. It will yield useful results for ongoing debates on a universal basic income.

 

 

Abolishing the Autumn Statement, Sticking with the Treasury View

📥  Brexit, Economy

If the Autumn Statement was meant to deliver on the Prime Minister’s Chamberlainite ambitions for improving working class living standards while intervening to restructure the economy towards higher productivity, investment and exports, it has disappointed. Post-Brexit referendum downgrades to growth forecasts have increased borrowing and forced the Chancellor to push deficit reduction further out into the future. But there was very little in the way of extra support for low-income families and no increase in planned public spending on the NHS, social care or childcare. Meanwhile, tax changes – increases in the Personal Tax Allowance and higher rate income tax threshold – favour households in the top half of the income distribution.

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The new National Productivity Investment Fund is the biggest spending item in the Autumn Statement, but at less than an average £5 billion a year, it is small beer when compared to the scale of the challenges the UK faces. The UK’s business investment is falling, productivity is catastrophically low, and we are not paying our way in the world. Huge regional disparities persist.

This is what the Office for Budget Responsibility report has to say on a number of these key issues. On business investment:

“The latest data show that business investment in the first half of 2016 was down 1.4 per cent on a year earlier. We expect that weakness to continue, with heightened uncertainty following the EU referendum causing investment to fall further in the second half of 2016 and for growth to remain subdued in 2017. Overall, we expect business investment to fall 2.2 per cent in 2016 and 0.3 per cent in 2017, before annual growth returns in 2018.”

On productivity:

“In March we revised down our productivity growth assumption, as we put slightly more weight on the post-crisis period of weak productivity growth relative to the pre-crisis historical average. Nothing in the recent data would lead us to change that judgement about the rate of trend productivity growth that the economy can ultimately return to. But we do expect uncertainty to reduce investment and productivity growth in the run-up to – and in the transition phase after – the UK’s exit from the EU. We have therefore made a further downward adjustment to trend productivity growth over the next five years.”

On the UK’s twin deficits:

“the concurrence of large fiscal and current account deficits has been a feature of the UK economy in recent years. This means that overseas investors are ultimately – if not directly – financing the UK’s budget deficit. This could pose risks if those investors’ confidence in the UK economy was damaged by uncertainty or changes in policy. That could lead to a sharper fall in sterling and a more abrupt demand-led narrowing of the current account deficit”

On household deficits:

“The persistence of a household deficit of the magnitude implied by our forecast would be unprecedented in the latest available historical data, which extend back to 1987. Other datasets extending back to 1963 also suggest little evidence of large and persistent household deficits, with the household surplus negative in only one year between 1963 and 1987. A household deficit of the size and persistence we expect over the forecast period might be considered consistent with the unprecedented scale of the fiscal consolidation and the extremely accommodative monetary policy upon which our forecast is conditioned. It nevertheless demonstrates that the adjustment to the fiscal consolidation is subject to very significant uncertainty, and alternative adjustment paths are quite possible.”

The Brexit vote could have led to a more substantial reckoning with these persistent weaknesses in the British economy. So far, it has not done so. A slow decline, rather than a sudden crisis, means that dominant orthodoxies in the Treasury have not been dislodged. The Chancellor may have abolished the Autumn Statement, but he has not changed the Treasury view.

 

Three Facts about Debt and Deficits

📥  Economy, Public sector

Professor Roger Farmer is Distinguished Professor of Economics at the University of California, Los Angeles (UCLA) and Research Director at the National Institute for Economic and Social Research (NIESR). 

The Chancellor of the Exchequer, Philip Hammond, will present his Autumn Statement to Parliament on Wednesday. In the heated debate over austerity, this piece offers three facts about debt and deficits which, I hope, will help shed light on the issues he will face.

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Fact Number 1: UK Public Sector Debt is Not Large

The UK public debt is equal to £1.7 trillion and it is increasing at a rate of £5,170 per second (National Debt Clock UK). But although government debt is increasing at a rapid rate, that fact does not pose a threat to the solvency of the UK Treasury.  Government debt should not be measured in pounds; it should be measured in GDPs. When GDP is high, so are tax revenues, and so is the ability of the government to repay.

Chart 1 shows the ratio of government debt to GDP for every year beginning in 1692. Notably, this ratio has been as high as 250% – during the Napoleonic War – and almost as high again at the end of WWII.

Chart 1: UK Public Sector Debt

Chart 1: UK Public Sector Debt

Fact Number 2: Governments Do Not Repay Debt: They Grow Out of It

Chart 2 reproduces the debt-to-GDP ratio from Chart 1, but the time scale is limited to the years from 1920 to 2015.  Public sector debt is the upper solid line, measured on the right scale as a percentage of GDP.  The line marked by circles, measured on the left scale, also as a percentage of GDP, is the value of the public sector deficit, smoothed by averaging adjacent values. A positive number indicates that the public sector spent more than it received in revenue.

On average, the public sector borrowed more in every year from 1920 to 2015. Nevertheless, the debt-to-GDP ratio fell continuously from the end of WWII to the early noughties. The public sector borrowed more – but its debt, properly measured, fell.

Chart 2: Debt, Deficits and Interest Rates Net of NGDP Growth

Chart 2: Debt, Deficits and Interest Rates Net of NGDP Growth

George Osborne, former Chancellor of the Exchequer, planned to bring the government budget into surplus by the year 2020. That plan represented a break from UK post-WWII policy. A surplus of public sector borrowing is neither necessary nor sufficient to reduce government debt when debt is measured as a fraction of the government’s ability to repay.

Fact Number 3: Government Debt Should Not Be Zero. Ever!

Nation states borrow to provide public capital: rail networks, road systems, airports and bridges, for example. These are examples of large-expenditure items that are more efficiently provided by government than by private companies.

The benefits of public capital expenditures are enjoyed not only by the current generation of people, who must sacrifice consumption to pay for them, but also by future generations who will travel on the rail networks, drive on the roads, fly to and from the airports and drive over the bridges that were built by previous generations. Interest on the government debt is a payment from current taxpayers, who enjoy the fruits of public capital, to past generations, who sacrificed consumption to provide that capital.

To maintain the roads, railways, airports and bridges, the government must continue to invest in public infrastructure. And public investment should be financed by borrowing, not from current tax revenues.

Chart 3 shows that investment in public infrastructure was, on average, equal to 4.3% of GDP in the period from 1948 through 1983. It has since fallen to 1.6% of GDP. There is a strong case to be made for increasing investment in public infrastructure. First, the public capital that was constructed in the post WWII period must be maintained in order to allow the private sector to function effectively. Second, there is a strong case for the construction of new public infrastructure to promote and facilitate future private sector growth.

Chart 3: Public Investment as a Percentage of GDP

Chart 3: Public Investment as a Percentage of GDP

The debt raised by a private sector company should be strictly less than the value of assets, broadly defined. That principle does not apply to a nation state. Even if government provided no capital services, the value of its assets or liabilities should not be zero except by chance.

National treasuries have the power to transfer resources from one generation to another. By buying and selling assets in the private markets, government creates opportunities for those of us alive today to transfer resources to or from those who are yet to be born. If government issues less debt than the value of public capital, there will be an implicit transfer from current to future generations. If it owns more debt, the implicit transfer is in the other direction.

The optimal value of debt, relative to public capital, is a political decision. Public economics suggests that the welfare of the average citizen will be greatest when the growth rate is equal to the interest rate. Economists call that principle the golden rule. Democratic societies may, or may not, choose to follow the golden rule. Whatever principle the government does choose to fund its expenditure, the optimal value of public sector borrowing will not be zero, except by chance.

Recommendations for the Autumn Statement

What can we learn from these three facts and what should we look for in the Autumn statement?

We should not be too concerned about a debt to GDP level approaching 100%. We have been there before and we will go there again.  We should be concerned that public spending has shifted away from investment on the capital account and towards the current account.

Economics has the reputation of being the dismal science. It is a dismal reality that there are diminishing returns to the prolongation of life. As we invest an increasing share of resources into advanced drugs and new treatments, the additional benefits, measured in extra weeks of life, will shrink.

As the population ages and life expectancy increases there will be an increasing burden on pensions and the National Health Service. These expenditures are predictable and can be planned for by stabilising the deficit on the current account either through limits on expenditures or through increased taxes. Our politicians must choose how much, as a society, we spend on health. And this choice must be presented to the electorate.

Capital account expenditures should be separated from the current account and increased back to 1960s levels. Work by Paul Romer, the new Chief Economist of the World Bank, suggests that these expenditures have the potential to pay for themselves. He advocates the creation of new charter cities and the expansion of existing cities. The last coalition government’s proposal to create a ‘Northern Powerhouse’ is an example of an investment of this kind.

There are also strong economic arguments to consider education expenditures at all levels – primary, secondary and tertiary – to be a capital expenditure. Education is an investment in the British people from which we all gain. But as with all capital expenditures, investment in education should be targeted towards the areas that have the highest potential for social impact.

 

On November 22, Professor Farmer will speak at an IPR public lecture entitled Prosperity for All: How to Prevent Financial Crises.

This post originally appeared on the NIESR blog.

 

 

Cost over quality: sexual health in an age of austerity

📥  Economy, health, policymaking, Public sector

Dr Frances Amery is Lecturer in British Politics at the University of Bath and Co-Convener of the PSA Women and Politics Specialist Group.

Sexual and reproductive health (SRH) is a hugely important yet neglected area of public health. From access to abortion and contraception to treatment for HIV, SRH services are an essential part of efforts to address inequality. Yet SRH provision has been severely impacted by the NHS restructure precipitated by the 2012 Health and Social Care Act and by subsequent cuts to public spending.

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The policy background

Department of Health guidance on SRH provision is set out in A Framework for Sexual Health Improvement in England, published in 2013. The Framework was published amid widespread uncertainty about what the upcoming reforms to the NHS would mean for SRH services and calls for the government to clarify its approach, while responding to evidence of inequalities in the sector. In particular, campaigners and medical organisations called for a life course approach to SRH which takes into account the ways in which men and women’s needs change with age.

The Framework appears to address these concerns. Equalities issues are foregrounded throughout: the document draws attention to the need to tackle discrimination and stigma surrounding sexual health matters, to ensure equality of access to services, to promote good body image and self-esteem, and to raise awareness of issues surrounding consent. Throughout, the different needs of different social groups and identities are highlighted. Calls for a life course approach are also addressed in a section titled ‘Sexual health across the life course’.

On paper, there has been a clear attempt to respond to demands of various advocacy groups. But as many equality policy researchers have observed, good intentions on paper often do not result in equality in practice. Indeed, the Framework has come under fire from SRH providers and campaigners for putting forward ‘ambitions’ without setting in place strategies to achieve them.

Inequalities remain in sexual and reproductive health

In spite of the high-flown ambitions found in DH guidance, huge inequalities in service provision and access remain. A 2012 report by the All-Party Parliamentary Group on Sexual and Reproductive Health (APPGSRH) found evidence of some local authorities barring women over the age of 25 from accessing contraceptive services, and sexual health charities suggest that this situation has not improved. There are also regional variations in the coverage of abortion services, with Scottish women facing significant barriers in access, while abortion law in Northern Ireland remains incredibly strict. Many women are not able to access abortion and contraceptive services under one roof, meaning that the quality of the care they receive is compromised.

Meanwhile, clinics around the country face the threat of closure due to budget cuts. An example is the proposed closure of the genitourinary medicine clinic at Whipps Cross Hospital, which campaigners say will have a disproportionate impact on black and Asian men living with HIV. While closed clinics usually have their services integrated into a larger clinic at a different site – as is planned for the Whipps Cross clinic – there is often still a negative impact on the community as patients lose access to local services. Some patients may not be willing or able to travel the longer distances now required of them.

Particular difficulties exist regarding trans people’s access to services. Demand for trans services is booming, yet there are only a handful of gender identity clinics in the UK. Waiting times are astronomical, with some clinics predicting that new patients will have to wait four years for their first appointment.

Among all this, race is a cross-cutting issue. Black, Asian and minority ethnic (BAME) communities tend to suffer worse health outcomes than the general population, and sexual health is no exception: BAME communities bear a disproportionate burden of HIV, and BAME people can sometimes face more stigma and greater barriers when accessing sexual health services. This problem is worsened by the closure of clinics servicing local communities. There is also a lack of representation in service provision: for example, BAME trans people might never meet another trans person who shares their background when attending treatment and support groups.

Why aren’t we delivering adequate services?

The government’s ‘ambitions’ regarding SRH provision and related inequalities are hindered, in large part, by fragmentation in commissioning and service provision. Lack of centralised, top-down direction is not necessarily a problem for healthcare, and local networks can be key players in advancing healthcare services. But in this case, fragmentation has been accompanied by a lack of accountability within commissioning structures resulting in gaps in service provision. This was already the case before the Health and Social Care Act 2012 came into force, but has been worsened by the subsequent restructuring of the NHS.

The Health and Social Care Act abolished the existing structures responsible for commissioning services and replaced these with new Clinical Commissioning Groups (CCGs), as well as establishing new national bodies. Responsibility for commissioning the various services making up sexual and reproductive healthcare – including abortion services and HIV treatment – is now spread out among CCGs, local authorities and the national commissioning board, although the lion’s share of responsibility rests with local authorities. The APPGSRH argues that this has resulted in a further loss of clear lines of accountability, which means that commissioners are not able to work together effectively. These commissioning silos can mean that it is not possible to deliver integrated services under one roof, since abortion and contraceptive services, for example, are commissioned by different bodies. Public Health England, the new executive agency with responsibility for SRH (among other aspects of public health in England), has ‘reducing health inequalities’ as a key part of its stated mission, but little role in policy formulation. Initial claims that the body would ‘speak truth to power’ appear to have been forgotten, and it has so far shown an unwillingness to challenge government policy.

This has all been compounded by the politics of austerity and in particular by cuts to local government budgets. Since November 2015, local authorities’ public health budgets have been separated from the budget for NHS England. This means that they are not protected from the latter’s budget ring-fencing, and public health spending has dramatically fallen as a result. While local authorities receive their own ring-fenced grants for public health, there is evidence that these are being diverted towards threatened services in other areas. Austerity has promoted unequal health outcomes directly, as clinics and services close or relocate as a result of budget cuts. Some contracting models appear to prioritise cost efficiency over quality, further compromising the services on offer.

Cuts to SRH services are a false economy – they result in drastically increased spending due to unintended pregnancies and STI infections. We should be more concerned, however, with the adverse impact of cuts on disadvantaged communities. While Theresa May has expressed an interest in social justice, it remains to be seen whether she will address the trends set in motion under her predecessor.

 

Comparing Basic Income Experiments: Lessons and Challenges

📥  Economy, living wage, research, universal income

Dr Jurgen De Wispelaere is a Policy Fellow at the IPR, as well as Visiting Research Fellow at the University of Tampere. As part of the latter role, he plays a part in the Kela-led research team preparing the upcoming national basic income experiment in Finland.

Experimenting with basic income: a unique situation

In Europe we are faced with a unique situation: in 2015/2016 not one but two countries started down the road of piloting a basic income experiment. There are important similarities between the experiments planned in Finland and the Netherlands. All going well, both countries hope to get started in early 2017 and run the experiment for two years - and in both cases, for a variety of reasons, the plan is to pilot an experiment limited to social assistance recipients. In short, Finland and the Netherlands will be simultaneously conducting an experiment on a broadly similar target population.

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There are of course also important differences. First and foremost, the experimental design in both countries is very different. For example, Finland will pilot a national randomised controlled trial with a single basic income model, while in the Netherlands different municipalities will experiment with a variety of models. There are also very interesting differences in terms of the political process associated with the basic income experiments: where Finland’s experiment was initiated by the Finnish government and is therefore highly centralised, the Dutch experiments were pushed onto the policy agenda by local NGOs or municipal decision-makers against considerable resistance from the central government. Finally, Finland and the Netherlands are very different types of welfare states, and we can expect variation in welfare institutions and processes to affect both the political decision-making process and the actual design of the proposed experiments.

Why compare?

This combination of two experiments simultaneously taking place in countries that differ in important respects is a unique situation that opens up the possibility of engaging in serious comparative research. Why compare? There are three reasons why both projects should engage in close collaboration and why we should adopt a comparative approach to studying what happens in Finland and the Netherlands.

The first reason is practical. Piloting a basic income scheme is a complex endeavour and those involved in designing and implementing the experiment run into a lot of problems along the way. There is much to learn from experiments carried out in the past in the US and Canada as well as, more recently, Namibia and India. But the lessons to be learned from those experiments are limited by the fact that they took place several decades ago — the world has moved on quite a bit since the 1970s — or that they operated in an environment that is very different from that of an advanced welfare state inside the EU. For this reason it makes sense that the experiments about to take off in Finland and the Netherlands may be able to help each other more than any of those that took place before. Exchanging information about hurdles encountered, as well as proposed solutions, may offer key guidance that could benefit both experiments.

A second reason for thinking comparatively relates to building up cumulative knowledge about basic income design, implementation and effects. Despite a massive increase in media and policy attention, we actually don’t know that much about basic income. Many arguments doing the rounds run the gamut from “reasonable expectation” (when grounded in good theory or analogous reasoning from other policy areas) to wild speculation (in other cases). There is a simple reason for that: basic income has not been implemented in a way that allows for robust insights.

The recent interest in pilots and experiments offers a great opportunity to (partly) rectify this problem, provided we adopt an approach that allows for systematically comparing design, implementation and results, as well as the underlying policy process. There is little to be gained from experiments that make it impossible to compare results in any meaningful way. Streamlining experimental design as much as possible to facilitate valid comparisons during and after the pilot — e.g., by standardising baseline surveys, indicators and measurement instruments where possible — is of immense importance in terms of furthering our global knowledge about basic income policy. Although experiments will always have important variation built into them, given the specific context in which they operate, when carefully coordinated they will tell us how to interpret design differences and their effects on the outcomes. And this, in turn, helps us understand which outcomes are unique to a specific experimental setting, and which can be generalised across and reflect common results of instituting a basic income.

A third important reason pertains to the politics of basic income pilot experiments. The dramatic increase in media and policy attention in the span of a mere three years has taken everyone — advocates and critics alike — by surprise. We know next to nothing about the factors that explain why basic income has suddenly become politique du jour amongst the political elites (Sure, we all have out little pet theories, but without systematic analysis and evidence, that is exactly all they are!). Equally, if not more importantly, we are only beginning to understand the political drivers of basic income policy development more generally. Against this uncertain background, the experiments play a crucial role in uncovering in a systematic manner the policy and political processes that have brought us to where we are now. Understanding these underlying processes, of course, is also critically important in thinking about where to go next, and how to make use of basic income experiments and their results in due course to move policy development along.

Having experiments taking place in two countries as diverse as Finland and the Netherlands offers a unique opportunity to study the political forces at play — an opportunity not to be wasted. Two intriguing aspects of these jurisdictions merit particularly careful examination. First, comparing the top-down approach adopted in Finland with the bottom-up approach that characterises the Dutch context allows us to examine closely the complicated political process by which an idea moves onto the policy agenda and — hopefully — soon enters the implementation phase. Real world policy development of the basic income proposal will have to make sense of the multi-level nature of its design and implementation. Second, there are important lessons to be learned in terms of framing the basic income debate: where Finland has embraced the experiment as a natural continuation of several decades of intense and complicated debate about basic income, in the Netherlands the experiments proceed while strategically avoiding any connotation with the basic income idea. Understanding the framing process will help political strategy in overcoming public and political resistance of the basic income idea.

Challenges to adopting a comparative approach

There are challenges to adopting a comparative approach to basic income experimentation. Some of the challenges are related to each experiment as an individual — e.g., maintaining the political momentum to carry out the experiment in a manner that produces reliable results — while others pertain to the demands of coordination between experimental teams. Examples of the latter include the need to adapt the research design and experimental setting to maximise comparability, the sharing of information and regular communication across jurisdictions — keeping in mind that each project is highly politicised! — and the building of a cross-country collaborative research network dedicated to supporting and evaluating ongoing and future basic income experiments. There is much work to be done, but the opportunity is there for grabbing.

 

This piece draws on information from a workshop entitled “Experimenting with Basic Income: Finland and Netherlands”, which was hosted by Kela with the aim of exchanging views between researchers involved in the planning of the Finnish basic income experiment and researchers from the Netherlands currently preparing the experiments planned for early 2017 in Utrecht, Wageningen, Tilburg and Groningen.

The presentations given at the workshop were recorded and can be viewed here. This piece has also been published on the Kela website.

 

A world collapsing

📥  The far right, Trump, US Presidential Elections, voting

The measure of Donald Trump’s victory is given by those who have been first to welcome it: Marine Le Pen, Pauline Hanson, and David Duke, the former leader of the Ku Klux Klan. Trump gave voice to deep wellsprings of racism in American society, and now stands as a global figurehead for nativist, far right movements. “Their world is collapsing. Ours is being built”, said the Front National’s Vice President, Florian Philippot. It is hard to disagree.

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Trump’s insurgency will test James Madison’s institutional firewalls to destruction; the Republicans now control Congress and the Presidency, and will add the Supreme Court to the ledger in short order. The Republican mainstream will not be in charge, however. Trump was elected largely without its support, and he drew political energy from its most vociferous right wing critics. Worse, he campaigned against the institutions of American democracy itself: its systems, norms and laws. These institutions will need all the resilience they have possessed throughout the history of the United States of America to withstand him. As the political scientist David Runciman has remarked, “What if the shock that is capable of reforming the system is also capable of destroying it?" Glib talk of “post-liberalism” will not do now. Liberalism will need all the defenders it can get.

Once again, mainstream progressive politics has been found wanting. Obama delivered a stronger economy and healthy pay rises in the last year, but it wasn’t enough. Clinton couldn’t find the voice to animate progressive America; the curse of a bloodless, calculating and hollowed out politics on the mainstream centre-left has taken another victim. There can be no Third Way when you are up against the likes of Donald Trump. There is no triangulating Trumpism.

The European Union will now face massive challenges: defending its Eastern borders against an emboldened Putin; defending an embattled global economic order against rampant protectionism; and defending itself against resurgent fascism and the break-up of its historical project. It will likely find an ally in China, which will resist protectionism and global disorder, turning the axis of world politics in a new direction. But Eurozone leaders must also now urgently ask themselves why working class voters have turned so decisively against the economic order that has prevailed in the West since the 1980s – and change path before it is too late.

Some thoughts on Article 50 and the High Court Ruling

📥  Anglosphere, Brexit, EU Referendum, Euroscepticism

There can be little doubt that the government lost its case over the exercise of prerogative power to trigger notification of Article 50 (the mechanism by which the UK begins the process of leaving the European Union) very badly in the High Court. The court’s ruling is comprehensive - and damning.

As public law experts have noted, the government’s legal case would have been stronger if it had conceded that withdrawal from the European Union is not inevitable after Article 50 has been triggered. Lord Kerr, the British diplomat who authored Article 50, has argued that the process is reversible; that the withdrawal can itself be withdrawn.  That seems to be perfectly consistent with the text of Article 50, precisely because it is notably silent on this point – it doesn’t specify anything about revoking the notification, and the history of the European Union is replete with creative political use of the silences, blank spaces and inconsistencies in European law. (Indeed, when the founders of the European Coal and Steel Community signed the Treaty of Paris in 1951, the paper itself was blank: they had been negotiating so extensively over its terms that a final text was not ready for the official signing ceremony. “Europe started as a blank page”, the Dutch political theorist Luuk Van Middelaar once wrote).

The confidence of the High Court’s ruling on this point would therefore appear misplaced. It asserted that the notification of Article 50 would trigger the irreversible loss of the claimants’ rights. But that interpretation can be challenged in law, and in practice it cannot be certain that Article 50 is irrevocable, given the political contingencies. Yet for obvious political reasons, the government considered it untenable to concede that Article 50, once invoked, could be reversed.

It seems unlikely that the government will change its stance and decide to argue that Article 50 is revocable when the case comes before the Supreme Court in December. In addition to the political hit it would take, the government would then be in disagreement with the claimants over the interpretation of Article 50, which is a piece of EU law. And in that instance, the Supreme Court would have to refer the case to the European Court of Justice. As one leading European law expert, George Peretz QC put it, "if there is a question of European Union law [in a Supreme Court case] they have to refer it to the ECJ, unless the answer is obvious. That's a basic principle of EU law."

So the government will be back to arguing that prerogative power does indeed apply to Article 50, on which the High Court’s ruling was clear and decisive. It will likely lose. Then the focus will shift back to Parliament.

If legislation, rather than a substantive motion, is required to give effect to the courts’ ruling, then it will be a very short bill, as Hannah White at the Institute for Government has argued. The government will not want a Christmas tree on which pro-Europeans can hang all sorts of amendments. Instead, the opposition parties, and Remain Conservatives, are likely to try to amend the legislation, as White notes, “to place conditions on the Government before it can trigger Article 50. These could take the form of timing or process requirements – for example, a requirement on the Government to provide Parliament with information about its negotiating position before triggering Article 50.”  This also makes it very unlikely that MPs will be able to insert a clause in the Bill requiring a second referendum on the terms of Brexit, as Owen Smith MP wants to do. Parliamentary clerks would rule such amendments inadmissible. But it is not obvious that the legislation will take such a long time to get through Parliament that the timetable for triggering Article 50 before the end of March 2017 will slip. Governments can strip the legislative barnacles off the boat and clear the path for an emergency bill relatively easily if they need to, and this legislation will take precedence over everything else. Pro-European MPs will extract a price from the government, but they will not vote to stop Article 50 being triggered.

Nicola Sturgeon has given notice, however, that the SNP will use the legal opening provided by the High Court to open up new flanks of attack on the government. This will bring the tensions between the constituent nations of the UK, and an emerging soft federalist vs unionist hard Brexit, fully into view.

A detour into history may help explain this. One of Lord Kerr’s namesakes is Philip Kerr, later Lord Lothian. Each man was once the UK’s ambassador to the USA  - the latter during the early days of World War Two, when he gathered support in Washington for the British war effort, before dying of exhaustion. He was also, earlier in his life, a leading figure in Milner’s Kindergarten, a group of young men who served Lord Milner as High Commissioner in South Africa at the turn of the twentieth century. They would become ardent imperialists and advocates of Imperial Federation between Great Britain and its settler colonies. In their writings, one can trace the antecedents of the Eurosceptic idea of the Anglosphere that figures such as Dan Hannan have done so much to popularize. And yet towards the ends of their careers, Kerr and his peers, like the tireless Lionel Curtis, would come to favour Western European federation, as a step towards a larger, multinational federation of the liberal democracies. Federation was vital to the prevention of war, and they had seen too much war in their lives.

This federalist tradition was lost after World War Two, but it was influential on continental thinkers framing the emerging European Union. It has resurfaced as the United Kingdom grapples with its own internal relations, as well as its place in the world, as a consequence of Brexit. Gordon Brown has made the case for a federalist Brexit in forceful terms today, and if the United Kingdom pursues a flexible Brexit – or “flexit” - it will be a federalist one.  MPs from the SNP and SDLP, and some Liberal Democrat and Labour MPs, are likely to support distinct arrangements for the constituent nations of the UK. The legislation to authorize the notification of Article 50 will give them an opportunity to make their case. This will enlarge our democracy, not diminish it.

 

Citizen's Income: the long history of an inevitable idea

📥  Economy, Finland, future, living wage, policymaking, political parties, research, Switzerland, universal income, Welfare

Dr Malcolm Torry is Director of the Citizen's Income Trust and a prolific author on the subject of Citizen's Income.

On Tuesday 11 October the Institute for Policy Research hosted a seminar on the desirability and feasibility of a Citizen’s or Basic Income: an unconditional and nonwithdrawable income for every individual. An account of the seminar is available on the IPR’s website. I shall not here repeat what was said at that seminar: instead, I shall begin with a different seminar.

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Following the publication of its report on Citizen’s Income, the Royal Society of Arts hosted a seminar on the history and prospects of the Citizen’s Income debate. In his presentation Karl Widerquist, Co-chair of BIEN, the Citizen’s Income international umbrella group, recounted the history of the idea from the 18th Century onwards, and made suggestions as to the different ways in which the debate might now develop.

The subsequent discussion recognised that the more intense debate of the past two or three years has a variety of causes: think tank engagement with the issue, represented by the RSA’s and Compass’s reports, and interest at the Adam Smith Institute; successful pilot projects in Namibia and India; planned pilot projects in Finland and Holland; a referendum in Switzerland; political party interest in the UK (with the Green Party and the Scottish National Party supporting the idea, and Labour interested) and in other countries too; new trade union interest; and perhaps even the Citizen’s Income Trust’s 30 years of research and publications.

The current debate already has its own history, constituted by three phases: discussion of whether giving everyone a Citizen’s Income would be desirable, interest in whether it would be feasible, and discussion of which would be the best way to implement the policy. There are no firm boundaries between these three phases (if a Citizen’s Income could not be implemented, for example, then it would not be feasible – and if it wasn’t felt to be desirable then it wouldn’t be feasible either), and each new phase has been in addition to a previous phase or phases, rather than being a replacement – but the progression is significant because it is evidence for the increasingly serious nature of the current debate. The think tank reports listed above belong to the ‘feasibility’ phase, as does my own recent Institute for Social and Economic Research Euromod working paper and recent book. A significant contribution to the new focus on implementation will be an Institute for Chartered Accountants consultation on the subject in November.

Where will the debate go now?

Luke Martinelli’s recent Institute for Policy Research blog discusses the diversity of the current debate in terms of, firstly, the diverse political ideologies of some of the players, and secondly the diversity of Citizen’s Income schemes discussed. A Citizen’s or Basic Income is always the same thing. It is always an unconditional and nonwithdrawable income for every individual. But there are of course a wide diversity of different schemes, with each scheme specifying the levels of Citizen’s Income for different age groups, and the changes that will be made to the existing tax and benefits systems when the Citizen’s Income is implemented. Compass called a scheme that retains means-tested benefits a ‘modified’ scheme. It is not. The Citizen’s Income is a genuine Citizen’s Income, so the scheme is a genuine Citizen’s Income scheme.

There is a history to this diversity. As with the three phases of the current debate, so the longer-term debate has evolved by addition rather than by replacement. Thomas Paine’s suggestion, that those who no longer have access to expropriated commons should be paid compensation, has been a continuing theme, represented today by Guy Standing’s campaigning scholarship. Today’s most high-profile representative of the libertarian argument for a Citizen’s Income is Philippe Van Parijs, and Charles Murray represents well the extreme version of this tendency, which would like to scrap all other welfare provision on the implementation of a Citizen’s Income. But this is to suggest – as Martinelli’s blog post does – that arguments for Citizen’s Income, and accompanying preferred Citizen’s Income schemes, can be located in clear ideological categories. I suspect that this is less and less the case. There are no longer clear categories, and there are no reliable spectra on which positions can be located. Our age is increasingly one of radical diversity. My first book on Citizen’s Income, Money for Everyone, discussed political feasibility in terms of identifiable political ideologies. The following book, 101 Reasons for a Citizen’s Income, simply offers 101 different reasons, recognising that for each individual a particular bundle of reasons might be significant. A handful of the reasons offered are framed in terms of political ideologies, because for many people those are still salient – but most of the reasons are simply listed in such broad categories as ‘economy’, ‘society’, ‘administration’, etc. My most recent book, Citizen’s Basic Income: A Christian Social Policy, recognises that we are a community of communities, and that particular communities might have their own distinctive reasons for supporting or rejecting Citizen’s Income. As the Citizen’s Income debate becomes increasingly mainstream, we shall find the same tendency that we find with other current issues: that they will become political footballs – that is, they will be pushed around by political considerations, rather than in relation to their own characteristics. The Shadow Chancellor, John McDonnell, has for a long time recognised that we shall one day need a Citizen’s Income, and that the idea needs to be carefully studied by government. He spoke at the Citizen’s Income Trust’s conference in 2014, invited the Trust to organise one of his People’s Parliament events, and since becoming Shadow Chancellor has reiterated his interest. Jeremy Corbyn, Leader of the Labour Party, has also been clear about his support. During the recent Labour Party leadership campaign, Corbyn’s opponent Owen Smith stated his view that Citizen’s Income wasn’t credible. Whether he had read any of the research I don’t know – but it certainly appeared that the motive for his objection was that his opponent had supported it. It is regrettable when positions are taken for reasons proceeding from a personal political career, or for factional advantage, rather than on the basis of evidenced and reasoned argument – but incidents such as this are useful because they signal the fact that an idea is understood, and that it is understood to be significant. What is then required is a sustained emphasis on the idea’s feasibility.

The Feasibility of Citizen’s Income understands feasibility as multifaceted, and recognises that specifically political feasibility is just one aspect of feasibility. In order to be implemented, a Citizen’s Income scheme would need to pass two kinds of financial feasibility test, with regard to both the feasibility of paying for it and the need to avoid imposing losses on low-income households at the point of implementation; it would need to pass psychological, behavioural, and administrative feasibility tests; and it would need to be able to negotiate the complex policy process from idea to implementation. The book concludes that there are Citizen’s Income schemes that could achieve all of that. A conclusion that might have been more explicit is that conformity of the scheme to a political ideology or ideologies might be fairly unimportant. A conclusion that is drawn matches one that Martinelli draws: that deeply embedded convictions, relating to reciprocity, deservedness, and so on, will need to be recognised at the implementation stage, because only those implementation methods that could achieve public approval can be regarded as feasible. The popularity of both the NHS and Child Benefit suggest that unconditional benefits fit the British psyche just as much as ideas of reciprocity and deservedness do; so as long as age groups generally felt to be ‘deserving’ are the first to receive Citizen’s Incomes, psychological feasibility should not be too difficult to achieve. Governments can move ahead of public opinion if they are moving in the same direction – recent examples are the ban on smoking in workplaces and public places, and the legalisation of same-sex marriage – and legislation can sometimes shape public opinion (as equalities legislation has done). This suggests that any government that saw good reason for implementing a Citizen’s Income scheme would be able to do so, as long as it started with age groups generally believed to be deserving – that is, children, retired people, the pre-retired, and the 16+ age group.

Martinelli suggests that the Citizen’s Income debate will exhibit a variety of different Citizen’s Income schemes, with each kind relating to a different set of political convictions. I’m not so sure. It is a reasonable assumption that for the foreseeable future any initial Citizen’s Income scheme in a developed country will need to be revenue neutral, and possibly strictly revenue neutral (in the sense that only tax allowances related to earnings would be reduced to help to pay for the Citizen’s Income). Microsimulation research at the Institute for Social and Economic Research has shown that a revenue-neutral Citizen’s Income scheme can only avoid imposing unacceptable losses on low-income households if current means-tested benefits are left in place and are recalculated to take account of each household’s Citizen’s Income and changes in net earnings. Recently updated figures show that a working-age adult Citizen’s Income of £60 per week could be paid for on this basis. This is not large, but neither is it insignificant. Compass’s recent report takes a similar approach. The RSA report does not – but neither has it tested its proposed scheme for low-income household losses at the point of implementation. We look forward to the results of current IPR microsimulation research. We are now more aware than before that although it is possible to construct a wide variety of Citizen’s Income schemes in theory, in practice only a narrow range of that diversity could ever be financially feasible in both senses of that term. If the debate about Citizen’s Income remains mainstream, and if it becomes increasingly so, then any infeasible scheme will be put under considerable pressure (as the Green Party’s proposed scheme was before the 2015 General Election) – and the result will be convergence on a narrow range of revenue-neutral schemes that would not impose losses on low-income households at the point of implementation.

The increasingly flexible and diverse nature of the employment market, family structures, and society and the economy generally, and the way in which the proceeds of production will continue to accrue to capital rather than to labour, mean that sooner or later we shall need a Citizen’s Income – and that we shall need to find some means of paying for it. But that could still be a very long process. Maybe by this time next year everybody will have lost interest, and the idea will have to await another upsurge in interest in a generation’s time; or maybe there will be both developing and developed countries taking the first steps towards implementation. More likely, we shall experience a situation somewhere between those two. Whatever the debate is like next year, it will have been important for high-quality research to have facilitated it. For this reason it is a pleasure to see the Institute for Policy Research contributing to the research that we shall need, and to the widespread debate that is now required.

This blog post develops on themes discussed by Dr Torry in a recent IPR Seminar. You can view the seminar and slides in full on our online lectures page, or listen to the podcast on our Soundcloud playlist.

Cooperating for Africa: two challenges to meeting development goals

📥  development, Economy, Foreign aid, International relations

Seung-Jin Baek is an Economist at the Renewal of Planning Section of the United Nations Economic Commission for Africa (ECA), based in Addis Ababa, Ethiopia, and is studying on the IPR's Professional Doctorate programme.

Currently, Africa faces a great challenge, in that the considerable development objectives that the continent must meet are being tackled through addressing two separate agendas. At the regional level, Africa has her own long-term development framework – Agenda 2063 – that aims to achieve an integrated, prosperous and peaceful Africa. Then, at the global level, the 2030 Agenda for Sustainable Development – adopted in September 2015 – sets out Sustainable Development Goals (SDGs) that are comprehensive and promise to rally global partners in support of Africa’s development.

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Under these two agendas, Africa is now confronted with a dual transition: the global-level transition from the Millennium Development Goals (MDGs) to the SDGs, and the continent-wide implementation of Agenda 2063. The numbers of goals, targets and indicators involved in each plan reflects just how complex this dual transition is: Agenda 2063 has 7 aspirations, 20 goals and 34 priority areas, 171 national targets, 85 continental targets and approximately 246 indicators, while the SDGs comprise 17 goals, 169 targets and 230 indicators. Implementation will be no easy task for African countries.

These two agendas will provide a foundation for Africa’s inclusive growth and structural transformation. To achieve this, both African countries and development partners need to scale up their commitments to the implementation of the plans by leveraging synergies among them. Two factors are critical in this regard: engagement on Africa’s part with emerging partners, and a commitment from Africa and its partners to prioritise KID – knowing, integrating and domesticating both agendas – to make its goals achievable.

Africa’s engagement with development partners

The first area to be addressed is emerging partnerships, which will provide the financial framework within which development agendas can be achieved. Undoubtedly, global partnerships have been playing an important role in Africa’s development during the MDG implementation era, through bridging financing gaps for development and building policymaking and technology capacities. There is, however, still a considerable gap in addressing the special needs of African countries – such as the promotion of inter- and intra-continental trade, infrastructure development, and governance improvement as well as environmental management.

The most effective channel of such partnerships is trade, which has been a major commitment from development partners. Recent World Trade Organization international trade statistics, however, show that the share of Africa’s exports declined from 3.3 per cent in 2013 to 3.0 per cent in 2014 and 2.4 per cent in 2015. This is partly due to unfavourable movement in global commodity prices, which have a significant impact on investment and economic growth on Africa, given its heavy dependence on natural resource products for export.

Another essential channel is official development assistance, or ODA. Based on analysis of the OECD development statistics, Africa has maintained its position as the largest recipient of ODA over the past three decades with regional share of about 43 per cent – meaning that almost half of world ODA was injected into Africa. It should be noted, however, that most OECD-DAC countries do not meet their ODA commitments to provide 0.7 per cent of their countries’ GNI. In fact, the total ODA from the DAC group reached only 0.29 per cent of the combined GNI – implying a delivery gap of 0.41 per cent. Because this huge gap is unlikely to narrow in the near future, the quality of ODA and its use have to be seriously taken into consideration.

Role of emerging economies in Africa’s development

In the light of these global partnership trends, there are a number of action points for both Africa and development partners. First of all, it is imperative that African governments strengthen macroeconomic sustainability and public management of natural resource revenues, and leverage such funds for the transformation of their economies.

Given the substantial delivery gap in ODA commitments, it is also extremely important for Africa to develop and strengthen partnerships with emerging economies such as the BRICS (Brazil, Russia, India, China and South Africa) as an alternative, but very important, source of financing, learning and technology. For instance, according to Oxfam International’s Africa-China Dialogue Platform, China has emerged as the largest trading partner to Africa over the past five years: Africa’s trade volume with China reached US$225 billion, which is twice that the continent shares with the United States. Furthermore, Chinese foreign direct investment and other forms of development assistance to Africa are substantially increasing.

With this growing role of emerging partners, in addition to that of traditional development partners, the international community all together should work closely with African governments to strengthen capacities for domestic resource mobilisation and particularly to curb illicit financial outflows. According to the ECA’s study on illicit financial flows, Africa is currently losing more than US$50bn annually – almost double the foreign aid flowing into Africa – from aggressive tax avoidance practices by multinational companies.

Africa’s dual transition to the SDGs and Agenda 2063

The second point to which I refer is the dual transition that Africa must undertake to address both the SDGs and Agenda 2063. Despite the challenges identified above, recent developments at the regional and global levels point to an increasingly supportive financial environment for Africa. The question now is: what are the challenges associated with dual transition, and which areas of development should both Africa and development partners focus and how? For this, the MDGs to Agenda 2063/SDGs Transition Report 2016 clearly identified challenges and opportunities.

Implementation of both agendas requires advocacy for and sensitisation to the details of both frameworks to ensure awareness of their mutual relevance to national development and the relationship and synergies between them. In this context, the 2030 Agenda for Sustainable Development should be understood as an attempt to respond to the global dimensions of Africa’s development challenges, while Agenda 2063 should be viewed as a response to continent-specific development challenges and aspirations, many of which overlap.

With the sheer volume of goals, targets and indicators embodied in each of the agendas, there is inevitably significant convergence between them. In this regard, an integrated set of goals, targets and indicators – along with a harmonised review and reporting platform to develop a core set of continental indicators – is required to effectively track progress on both agendas. Such arrangements need to take into account the levels of development of individual countries.

While convergence between the two agendas is significant, integrated and coherent implementation of both agendas into national planning systems will be an operational challenge as significant as it is vital. In recognition of this challenge, the ECA has developed a draft toolkit that maps the 2030 Agenda for Sustainable Development and Agenda 2063 at the goal, target and indicator levels and provides a diagnostic tool for integrating both agendas in national planning frameworks.

Capacity matters most

In effect, successful implementation requires strengthened capacities for policymaking and the analysis of inter- and intra-sectoral impacts of policy initiatives. Even with the adoption of the SDGs alone, countries will require an integrated approach that simultaneously addresses the economic, social and environmental dimensions of sustainability in a balanced way. This is an area where evidence-based analysis of the structural effects (tradeoffs and synergies) of key policies is needed.

In the past there has been a tendency to consider immediate benefits above all else; the economic benefits of increased oil production, for example, were not adequately weighed against the possible negative environmental and social costs. Therefore, there should be a significant effort to identify the most appropriate institutional architecture that individual countries can use to facilitate effective implementation of the two agendas. Invariably, the role of planning agencies will be paramount in ensuring that the economic, social and environmental dimensions of policy decisions are reflected in a balanced manner in all aspects of programme and project execution.

In this new age of Africa’s development, multi-stakeholder partnerships remain one of the most critical means of mobilising internal and external resources. Furthermore, the active participation of emerging partners is required to address Africa’s challenges of dual transition and to support its operationalisation. In this regard, traditional partners and emerging nations need to establish ways of partnering and cooperating with each other towards supporting Africa in realising its development aspiration, particularly for the areas of KID:

[K]nowing about both agendas to simultaneously address the three dimensions of sustainability with strengthened evidenced-based policymaking capacities

[I]ntegrating both agendas to harmonise frameworks and establish common mechanisms of implementation and follow-up architecture

[D]omesticating both agendas in national planning frameworks with strengthened institutional capacities for effective institutional coordination and arrangements

 

 

This blog is mainly derived from Seung-Jin’s presentation during the Oxfam International Conference, which took place in Addis Ababa on 28 September 2016, and from the MDGs to Agenda 2063/SDGs Transition Report 2016, a joint publication by the ECA, African Union Commission, African Development Bank and United Nations Development Programme which was launched in the United Nations General Assembly on 21 September 2016. The views expressed in the blog are his own, and do not necessarily reflect the views of the United Nations.