Call poverty by any name
http://www.dawn.com/2002/text/ebr1.htm
By Our Special Correspondent
Pakistan Human Condition Report released earlier this month has come up with a new and perhaps a more comprehensive definition of poverty.
Prepared by the Centre for Research on Poverty Reduction and Income Distribution (CRPRID), a Planning Commission unit, the report has advised against policy focus just on a point estimate of head-count i.e. 30.6 per cent below the poverty line. Instead, according to authors of the report it should define the poverty lines to lie within a poverty band to accommodate estimation errors as well as minor differences in the underlying assumptions.
In addition, the report has asked the policy planners to direct differential policies at: a. The vulnerable group (the layer above the poverty band); b. the transient group( layer below the poverty band) and; c. the absolute poor (the group below the transients).
The vulnerable group requires policies like asset creation and safety nets which reduce the probability of ‘shocks’ pulling members from this group into the poverty band or the transient zone. The population within the poverty band and in the transient zone will require public/private investments and complementary policies (physical asset creation and /or transfer and education) which enable this group to move above the vulnerability zone.
Finally, the hardest task is to design and implement policies and complementary actions (education and employment) to lift the absolute poor to above the vulnerability zone.
This would be a big enough burden for any nation, says the Report. But this is only a part of the total burden when it is considered that poverty in Pakistan has been defined to include opportunity and capability deprivations in addition to basic needs (which includes food). Poverty of Opportunity Index (POPI) was presented in the 1998 report of Mahbubul Haq’s Centre for Human Development.
The Human Poverty Index (HPI)-(reflecting deprivation of capability) was introduced in UNDP’s 1997 Human Development Report. A poverty pyramid describes the relationship of these Poverty Indictors. Under the HPI-Criterion about 50 per cent of Pakistan’s population is below the poverty line’ that is 72 million Pakistanis.
The report brings out a highly depressing picture by disaggregating the non-income determinants of poverty- the condition in education, health and institutions: * at least 6 million children between the ages of five to nine years are out of school; * of the remaining 14 million children quality education may be available to only a small minority; * about 55 per cent of the 10+ years age population is illiterate under a criterion of literacy which is not even basic under the UNESCO definition of literacy. Even this sub-basic level 80 million citizens are illiterate.
If functional literacy were the criterion, then the illiterate population would be over 100 million; * the participation rate at the university level is 3 per cent of the 17-23 year age group. This is very low for becoming a modern state. In East Asia and OECD countries this rate is over 30 per cent; * in addition, Pakistan does not have a sustainable domestic scientific community. Its Research & Development investment rate is about 0.2 per cent of GDP. With 100 scientists and engineers per million population, Pakistan does not have a sustainable domestic scientific community; * there is a gender gap in this sub-basic literacy and there is a rural-urban gap.
The Balochistan female has a literacy rate of 9 per cent while Punjab/Sindh/NWFP male has a literacy rate of 72 per cent; * the morality rates of infants, children and mothers are high by regional and world standards. Due to the very high maternal mortality rate of 400 per 100,000 live births the sex ratio in Pakistan is 108 males to 100 females.
For Balochistan, this ratio is 115 males to 100 females; * about 40 per cent children under five years are malnourished; * air pollution contributes as much to the burden of disease as water pollution, but air pollution control is not in the I-PRSP outcome indicators except in the petroleum section where clean fuels are intended to be introduced.
With the current 40 per cent urbanization and its 3.5 per cent annual growth rate it is essential that ambient air pollution (indoor and outdoor) be measured in a systematic manner. At this time, such a practice does not exist; * income distribution is highly skewed with the top 20 per cent getting 50 per cent of the income, while the bottom 20 per cent getting only 6 per cent.; * the measurement and monitoring capacity of Pakistani institutions is such that timely information about impacts of policies on various dimensions of poverty and well being is not available; * macroeconomic policies-fiscal, tax burdens, subsidies, monetary, utility prices,-have had non-convergent effects on the poor.
Professionally more intensive policy integration among both instruments ( taxation, subsidization, pricing, credit etc) and sectors( agriculture, SME) is required for policies and actions to produce convergent poverty reduction effects. Three effects of non-convergence are particularly relevant for poverty reduction. One, the significant decrease in PSDP from 7 per cent of GDP in 1988 to 3.6 per cent in 2002.
Two, the precipitous decrease in poverty related subsidies from Rs. 5.2 billion in 1991 to Rs. 284 million in 2001.
Three, the tax burden increased by 4 per cent for the lowest income group G1 while it decreased by 21 per cent for the highest income group G12;
finally, since improved governance (rule of law, civil service, judicial, police reforms, devolution) is a requirement for economic growth it is critical that outcome indicators for measuring progress are included in the PRSP.
These measures should be in terms of transaction times and transaction costs for the poor in dealing with the public sector.
While this picture of poverty is highly depressing, there appears to be nothing in it which would set it apart from other such pictures drawn by various agencies engaged in the glamourous business of making money by looking at all kinds of data and coming up with impractical ideas on how best to reduce poverty. In this the IMF and World Bank funding also helps.
However, if you look at the last four factors that go into creating the poverty trap in Pakistan, you will realize what massive damage has been inflicted on this country’s socio-economic fabric in the last three years of military rule and its faithful adherence to the IMF/World Bank prescriptions.
The emphasis on macroeconomic stability has been stretched to the most ridiculous extent. And as a result the PSDP expenditure which was 7 per cent of the GDP in 1988 has been brought down to 3.6 per cent in 2002, poverty related subsidies have gone down from Rs5.2 billion to a paltry Rs284 million, tax burden has increased by 4 per cent for the lowest income group while it decreased by 21 per cent for the highest income group and finally by messing up with the judiciary and violating all norms of rule of law in order to perpetuate military’s pre-eminence in the governance, the government in the last three years has only aided and abated in the crime of expanding the sea of poverty in this country.
wont work unless if people get involved. In fact, no form of government will work without the involvement of people.