Poverty Reduction Strategy PapersPoverty Reduction Strategy Papers(PRSPs)(PRSPs)

- - Are they making a difference?Are they making a difference?

Carol Healy, Development Education and Research Network (DERN)

Carol.healy@nuigalway.iehttp://www.nuigalway.ie/dern

SynopsisSynopsis

• Background

• Principles and Goals of PRSPs

• Positive Elements

• Critique of PRSPs in their current form– Goals and principles in practice– Political Issues– Implementation

Poverty Reduction Strategy Papers Poverty Reduction Strategy Papers (PRSPs)(PRSPs)

• What are they?– Introduced in 1999– National Programme for Poverty Reduction– Established to ensure the proper use of debt

relief under the Enhanced Highly Indebted Poor Countries Facility (HIPC2).

• HIPC countries are entitled to debt relief after 1 year of successful implementation of the full PRSP

Background to PRSPsBackground to PRSPs

• 2000: World Bank “Voices of the Poor” Survey.

• World Development Report 2000 – 2001

• Now the new “pro-poor” development plan– Promoting opportunities– Facilitating empowerment– Enhancing security

PRSPsPRSPs

• Interim PRSPs (I-PRSPs)– Outline the causes of poverty as well as the

consultation process for the drafting of the final PRSP

• Full PRSPs– Established once countries submit an interim

PRSP and consult with the World Bank and IMF (in a “Joint Staff Assessment”)

PRSP Core PrincipalsPRSP Core Principals

• 1. Country- driven

• 2. Results Orientated

• 3. Comprehensive

• 4. Partnership-orientated

• 5. Based on a long term perspective of poverty reduction

• 6. Participatory

PRSP GoalsPRSP Goals

• 1. Promote Pro-poor growth

• 2. Promote empowerment by encouraging good governance (includes fiscal management and decentralised government)

• 3. Enhance human capital through improvements in health and education

Positive elements of PRSPPositive elements of PRSP

• Poverty reduction now at the core of the PRSP agenda

• Better coordination between states, donor agencies and beneficiaries as poverty reduction now the responsibility of finance ministers

• Improved dialogue: policy makers consult with the population on the limitations caused by poverty. (Helped to prioritise the needs of the poor)

Positive elements of PRSPPositive elements of PRSP

• Better accountability? – Governments obliged to discuss poverty and what

they are doing about it with their citizens, they may take poverty reduction more seriously , and be held to account more effectively

– Increased trend towards scrutiny of local and national government officials by citizens on budget expenditure issues

• Civil society has a deepened knowledge of budgeting / financial issues

Problems with the PRSPProblems with the PRSP

PRSPs and Goal 1: Promoting Pro-poor growth

• Pro-poor growth reduces inequality , so that the poor benefit proportionally more than the rich

• BUT: Redistribution issues

• BUT: Macro-economic policies similar to Washington Consensus policies

Polarization AND deprivation Polarization AND deprivation – the poor ARE falling – the poor ARE falling further behind and the incomes of 40% are too lowfurther behind and the incomes of 40% are too low

UNDP HDR1992, 2005

1992

2005

Problems with the PRSPProblems with the PRSP

• The PRSP and the Poverty Reduction and Growth Facility (PRGF)

• Participation in the PRGF

• Aligning the PRGF to the PRSP??? (EG Mozambique)

Mozambique PRGF and PRSPMozambique PRGF and PRSP

• PRGF

2004 June 2007

• 2nd PRSP

March 2006

Issue of: Ownership?

Problems with the PRSPProblems with the PRSP

• Goal 2: Promote empowerment by encouraging good governance

• - Empowerment and good governance can be achieved through decentralisation

• - Empowerment achieved by greater participation

• BUT: meaning of participation?

• 2005 IMF and World Bank PRSP Review:

‘Participation does not imply final consensus or that views garnered through participatory processes will necessarily be reflected in final programmes. Instead, participation should enable policy choices to be better informed’

Problems with the PRSPProblems with the PRSP

• EGs of Uganda, Honduras, Nicaragua, Zambia, Tanzania

• Role of Parliaments?

• Format of consultations

• Language

• Dissemination (Mozambique)

Problems with the PRSPProblems with the PRSP

• Issue of capacity to participate in the process?• -‘Supply-driven’ civil society? (getting involved in

what is currently fashionable) • PRSP has been criticised for not openly

discussing:– Industrial policy– Trade protection– Subsidy support to domestic markets

• Invited versus Created spaces

Problems with the PRSPProblems with the PRSP

• Goal 3: Enhancing human capital by improving health and education

• Increased funds for health and education

• Focus on AIDS, TB and malaria: donor priorities or national priorities?

Politics and the PRSPPolitics and the PRSP

• Mandate of the IMF and World Bank prevents them from being involved in politics. This has meant the PRS process has been highly technocratic

• Line ministries beyond Education and Health are often only very loosely involved

• PRSP and decentralisation (EG Ethiopia)• New governments (Honduras and

Nicaragua)

Implementing the PRSPImplementing the PRSP

• Discrepancies in terms of policy documents and their implementation (EG Zambia)

• Annual Progress Reports

Case Study – TanzaniaCase Study – Tanzania

• Tanzania:• 60% of Tanzania’s population lives below the poverty line.• BUT: • Genuine government commitment to reform, • Donors have galvanised around the PRSP, • Important shifts in policy; eg free primary school education. • Success:• Poverty reduction has been on Tanzania’s policy agenda since

1964. • PRSP is based on the country’s Vision 2025 document, and it’s

National Poverty Eradication Strategy, both of which were adopted in 1997.

• Government commitment to poverty reduction before the implementation of the PRSP.

Case Study - MalawiCase Study - Malawi

• Malawi• Prior to the PRSP, Malawi had no real poverty reduction policy• 1994: launched a poverty alleviation programme, • BUT: no real plans on how, how much, or when poverty would be

reduced. • 1996 it published Vision 2020, but this was not followed by fundable

action.• Malawi has not had the fiscal management that Tanzania has:

expenditure ceilings are frequently ignored by line ministries and other government agencies.

• Countries with a prior commitment to poverty reduction have greater ability to implement the PRSP?

• Why? – higher degree of national ownership

ConclusionConclusion

• Legacy of Participation but…– No radical change (neo-lib with a friendly

face?)– Civil Society weak/ ignored– A political technocratic debate– Other drivers (donors/politics)

• Invited versus Created spaces

Recommended ReadingRecommended Reading

• D. Booth (2003) Are PRSPs making a difference? The African Experience. Development Policy Review, Vol 21, No. 2

• D. Booth (2005) “Missing Links in the Politics of Development: Learning from the PRSP Experiment” ODI Working Paper 256

• D. Craig and D. Porter (2003) ‘Poverty Reduction Strategy Papers: a New Convergence’ World Development Vol 31, No 1

• J. Gould (ed) (2005) The New Conditionality. The Politics of Poverty Reduction Strategies. Zed Books

• IIED (2005) Participatory Learning and Action. Civil Society and Poverty Reduction. IIED

• Oxfam (2004) ‘From Donorship to Ownership? Moving Towards PRSP Round 2. Oxfam Briefing Paper 51

• F. Stewart and M. Wang (2003) ’Do PRSPs empower poor countries and disempower the World Bank, or is it the other way round?’ QEH Working Paper Series. Working Paper No. 108