The Trouble with Aid – Quantity, Institutions and Utopian Ideals

Posted on 13 September, 2016 by Fiona

On 14 July 2016, the Prime Minister Theresa May announced her new Cabinet, following a significant reshuffle and re-structure of Government. In this context, researchers from all over Newcastle University express their thoughts on the challenges and opportunities for the Government in the Ideas for May’s Ministers blog series, considering how individuals, communities and societies can thrive in times of rapid, transformational change. Professor Pauline Dixon is Professor of International Development and Education at Newcastle University. Her book “International Aid and Private Schools for the Poor” was named one of the top 100 books in 2013 by the TLS.

To: Priti Patel, Secretary of State for International Development
From: Professor Pauline Dixon, School of Education, Communication and Language Sciences

Just over a year before Priti Patel took up the post as Secretary of State for International Development, the Coalition Government brought into law the International Development (Official Development Assistance Target) Act 2015. The Act saw the enshrinement into law that 0.7% of Gross National Income (GNI) has to be spent on international aid. Priti Patel is required to ensure that the target is met in 2016 and in each ‘subsequent calendar year’.

It has been estimated in 2015 the UK spent £12.24 billion (0.71% GNI) in Official Development Assistance (ODA, i.e., international aid); in absolute terms the second largest in the world only to the US[1].

There are many groups with a vested interest in the aid industry, pushing for larger aid spending. However, it is not just the provision of aid that makes a difference. There needs to be a focus on making sure that aid is effective. Having a positive effect on economic growth and aiding the poorest is crucial; just giving money is not enough. The government’s introduction of spending targets could lead to waste and pressure to get rid of money.

When someone is put in a position of deciding what is good for others ‘the effect is to instil in the one group a feeling of almost God-like power; in the other, a feeling of childlike dependence’.[2] The result? The imposition of utopian colonial ideals, which are irrelevant in developing contexts.

Bearing this in mind can countries that continue to rely on and are given large amounts of ‘systematic’ or ‘bilateral’ aid, (that is the giving of aid to governments through government to government aid or institutions such as the World Bank) ever eradicate poverty?

Aid can make very little difference in countries where there are major barriers to development such as the environment being typically dominated by mismanaged, corrupt institutions created and perpetuated by elites. The lack of the rule of law and property rights along with inadequate governance and the lack of political freedom and the press all add to the inability for aid to engender sustained growth and a route out of poverty for its citizens.

As aid flows into a poor country that operates under autocratic regimes, those that benefit most according to the critics of aid are the wealthy political elite.[3] Even the World Bank acknowledges that corruption undermines Africa’s development with leaders, government officials, ministers and public servants lining their pockets with money destined for the poor.

One option would be to stop aid altogether.

But is there an answer or a way forward for international aid money? Is there a more productive way of channelling aid that could engender a positive effect on poverty alleviation, growth, focusing on the poorest?

One alternative is to look at market based solutions to poverty, ignoring the planners who do not have the knowledge to allocate resources, but listening to the searchers and Africa’s ‘cheetah generation’[4].The entrepreneurs and innovators, those operating and living at the grassroots level in the slums and shanty towns of developing countries. Here social media can play a role through economic empowerment, monitoring and reporting on corruption and mobilising public opinion.

Radical reforms are required to alter the way aid money is directed and transferred to the poor. If aid money is not directed at sustainable and scalable projects which focus on local entrepreneurs where communities are able to maintain the momentum once the aid has dried up, throwing good money after bad for the sake of it will perpetuate the ineffective, and sometimes damaging, consequences of aid. When aid agencies walk away, others need to be able to pick up the baton and run with it. The poor themselves are the solution.

Aid needs to start working and making a difference now more than ever before. Given a market focus it can. So what’s my advice to the Rt Hon Priti Patel?

Use gold standard research to inform policy not planners who think they know best.
Ask the poor what they want. From the slums of Nairobi to the shantytowns of Lagos, the poor aren’t waiting for aid agencies to rescue them. Visiting some of these thriving communities highlights what works for the poor by the poor;
Focus on market led initiatives and market based solutions encouraging entrepreneurship not dependency.

Sector Breakdown 2014 UK Bilateral IDA (£millions) (source DfID 2015)[5]

[1] https://stats.oecd.org/Index.aspx?DataSetCode=TABLE1

[2] Friedman, 1962 Capitalism and Freedom, Chicago, IL: Chicago University Press p. 148

[3] Moyo, 2009 Dear Aid: Why aid is not working and how there is another wy for Africa, Harmonsworth: Penguin

[4] Ayittey, George B.N. (2005), Africa Unchained: The Blueprint for Africa’s Future, New York: Palgrave MacMillan.

[5] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/482322/SID2015c.pdf

Reducing inequality…in national wealth

Posted on 24 July, 2015 by Jenny

The next in the blog series from Newcastle University Societal Challenge Theme Institutes giving recommendations for targets and indicators of the UN Sustainable Development Goals, is from Dr Andrew Walton, Lecturer in Political Philosophy in School of Geography, Politics and Sociology.

In the current proposal for the Sustainable Development Goals, Goal 10 states the aim to ‘reduce inequality within and among countries’. For many (good) reasons, much articulation of this goal has focused on its first component – reducing inequality between co-citizens within countries. But it is important also to consider what should be the appropriate target for the second component. What should be our aim and measure in reducing inequality amongst countries? My suggestion is to lessen the gap in per capita national wealth – the value of each country’s financial and physical assets.

Measures of (in)equality

The basic idea of measuring (in)equality involves comparing the circumstances of certain actors. Thus, any conceptualisation of equality must specify an answer to two questions:

Which actor should be compared?
What aspect(s) of their circumstances should be compared?

There are different ways to conceptualise and measure (in)equality historically [1]:

Model	Actor	Aspect(s)
Gross Domestic Product (GDP)	Countries	Final value of goods & services produced within nations’ borders
GDP/capita	‘Average’ citizen (country ÷ population)	Final value of goods & services produced within nations’ borders
Income	Persons or households	Disposable income / expenditure
Wealth	Persons or households	Assets, including financial holdings and physical goods, such as real estate

Perhaps obviously, these models ask us to think about (in)equality in rather different ways. For example, on current figures using GDP suggests that China is better-off than Switzerland, whereas GDP/capita suggests the opposite [2]. Similarly, both GDP and GDP/capita suggest that Brazil is a relatively well-off country, but measuring income and wealth highlight that it is home to individuals who are worse-off than almost the entire populations of similarly well-off countries [3].

What these differences highlight is that asking which model we should use to measure (in)equality pushes us to explore deeper philosophical questions about our underlying reasons for being concerned with (in)equality, and to find a measure that is tailored to these concerns. My suggestion here is that some of our underlying concerns point in the direction of exploring how countries compare in per capita wealth [4].

Why compare countries and why compare them per capita?

For many people it will seem obvious that there is something important about whether their country is well-off. It is sometimes thought important for ensuring that their country is respected by others and very commonly because it has a significant impact on whether its citizens have comfortable lives.

Some argue that comparing national circumstances is a mistake. They suggest that, ultimately, it is only the welfare of people that matters and, as noted above, cross-country comparisons can hide that some individuals within countries are badly-off. Advocates of this view might argue that Goal 10 should be collapsed into one goal: measuring (in)equality amongst individuals worldwide.

We should reject the conclusions of this argument. Because the SDGs also consider (in)equality within countries and have other goals targeting aspects of individual welfare, they will not overlook the worry mentioned above. Meanwhile, because one thing that benefits people’s welfare is to participate in the collective decisions and development of their nation, even this individual-centred view can acknowledge the importance of a world involving country groupings and, thus, the additional relevance of cross-country comparisons.

However, we should accept the point that countries are, in essence, valuable only insofar as they benefit their populations and our comparisons between them should reflect this concern. It is for this reason that our cross-country comparison should focus on a per capita measure, which looks at how some aspect of a country’s circumstance relates to its people.

Why compare wealth?

Some possible ways we could make per capita inter-country comparisons would be the following:

Model	Actor	Aspect(s)
GDP/capita	‘Average’ citizen	Final value of goods & services produced within nation’s borders
Wealth/capita	‘Average’ citizen	Assets, including currency, stock, bond holdings and physical goods, such as land, natural resources, and rights to global commons
Capabilities	‘Average’ citizen	Human development indicators, such as life expectancy, education, income

A reasonable case could be made that reducing inequality between countries in any of these respects would be a worthwhile target. Nevertheless, I proposed at the beginning of this post that the goal should be to focus on wealth/capita. Two related points support this view.

First, neither GDP/capita nor capabilities takes full account of the aspects of a country’s circumstance that affects the welfare of its population. To take two clear examples, currency reserves and natural resources, which are considered in wealth/capita, but not these other measures, both allow a country to provide its population with economic security and future consumption [5].

Second, many of the assets that countries hold are a matter of luck. For example, no country did anything to entitle it to the oil or gold that lies within its borders and, indeed, much of their economic wealth arises from the fortunes of the market.

In cases where there is a good that many actors desire and which no actor is entitled automatically to own, it seems sensible to distribute that good equally. If Isaac and I are sat beneath a tree feeling hungry when an apple falls on his head, it seems reasonable for us to share it. Similarly, insofar as it is valuable for countries to hold financial and physical assets and their current holdings have arisen from good fortune, there is a reason to aim for equalising their shares.

Moving towards international equality

A more fully fledged case for measuring inter-country (in)equality in terms of per capita national wealth is that achieving parity in this regard can, under certain conditions, represent a truly idealistic aim. There is a moral argument that a distribution of assets is fair if it mirrors what each relevant actor would have bought with equal purchasing power in the context of all goods being priced at a market-clearing equilibrium [6]. Such a distribution, in the international context, would entail equality in per capita national wealth and it is fair because it reflects the equality of all parties in their access to these goods and allows them to shape their holdings according to what they believe is worth having.

Realising this aim is perhaps a more long-term project than for the framework of the SDGs. Nevertheless, it helps show the value of building our understanding of (in)equality in national wealth and beginning to reduce it, whilst casting light on some important steps for moving towards this goal:

Pursue (the second component of) Goal 10 by:

Establishing a national wealth index and collect data on countries’ standings.
Setting a target of reducing inequality in per capita holdings.

Connect these targets and their longer-term aim to:

Adding impetus to Goal 16.7 of ensuring responsive, inclusive, participatory, and representative decision-making, in order for countries’ choices about asset holdings to reflect the collective interests of their people.
Helping articulate Goals 17.10-17.12 on shaping international trade towards an equal and equilibrated market.

Dr Andrew Walton is lecturer in political philosophy at Newcastle University. His main research interests are in global justice, liberal-egalitarian and socialist thought and questions of justice in public policy.

[1] The essential ideas used to construct this table are taken from Milanovic, B., Worlds Apart: Measuring International and Global Inequality (Princeton: Princeton University Press, 2005)

[2] These figures can be found via UN, ‘National Accounts Main Aggregates Database’, available at http://unstats.un.org/unsd/snaama/selbasicFast.asp [Accessed 17^th June 2015].

[3] See, for example, Credit Suisse, ‘Global Wealth Report 2014’, available at https://publications.credit-suisse.com/tasks/render/file/?fileID=60931FDE-A2D2-F568-B041B58C5EA591A4 [Accessed 17^th June 2015].

[4] This suggestion is elaborated in more detail in Walton, A., ‘On the Currency of International Equality’, forthcoming.

[5] It is worth noting that Capabilities also seems to point towards important aspects of human welfare. However, many other SDGs will pursue these kinds of concerns anyway, leaving space for the second part of Goal 10 to speak to the concerns I mention here.

[6] This view is most commonly associated with Dworkin, R., Sovereign Virtue: The Theory and Practice of Equality (Cambridge, MA: Harvard University Press, 2000).

To end urban hunger, focus on low-income housing and settlements in cities

Posted on 22 May, 2015 by Fiona

Millions of adults who live in low-income urban areas regularly fall short of the calorie requirement recommended for a healthy life. The relationship between low income housing and food security needs to be targeted by the UN Sustainable Development Goals (SDGs) in order to achieve Goal 2: ‘to end hunger, achieve food security and improved nutrition, and promote sustainable agriculture’. Dr Suzanne Speak (GURU, School of Architecture, Planning and Landscape) contributes to the Newcastle University Societal Challenge Theme Institute blog series by showing how the UN SDGs could end urban hunger.

Food security for the urban poor

In its 2013 report on the State of World Food Security, the UN Food and Agriculture Organisation estimated that one in eight people in the world were suffering from chronic hunger and undernourishment in 2011-13. While the crises of acute famine or drought afflicting small farmers and rural dwellers are well reported to the international community, the ongoing, daily undernourishment of many low-income people in urban areas is less well understood or prioritised.

The focus on food security has, until recently, been overwhelmingly on rural problems and on issues of food availability at a global and national scale. The UN Sustainable Development Goals do little to address this rural focus. Despite SDG 2 aiming to ‘end hunger, achieve food security and improved nutrition and promote sustainable agriculture’, there remains no explicit reference to urban hunger. Yet many millions of urban adults regularly fall short of the 2,100 kilocalories recommended for a healthy, active life. Urban food insecurity has been significantly overlooked, especially by some of the professionals who could influence it most. Food security remains invisible to urban planners and managers in comparison to other problems such as unemployment, overcrowding and decaying infrastructure [1].

Urbanisation has brought with it the urbanisation of poverty and now, many low-income urban populations are equally at risk of poverty and food insecurity. Indeed, the UN itself acknowledges the food security and malnutrition issues associated with this urbanisation of poverty [2]. There are many reasons for this urban food stress. While it is difficult for urban policymakers to intervene to address all of them, here are three points around housing and settlement policy which can help drive urban food strategies.

Increase secure livelihoods

Urban dwellers pay up to 30% more for their food than rural households [3]. However, livelihoods are unstable, being more dependent on waged income from precarious informal employment. Much of the informal-sector activity takes place outdoors (construction, street vending, or rickshaw drawing), making the rainy season an especially difficult period. Seasonal variations need to be taken into consideration when designing urban interventions. Urban households may need to remit funds back to the rural family, putting further stress on income and budgets.

The UN SDGs can help to address the problem of urban food insecurity through focused work on urban poverty. However, poverty is not the only issue affecting urban food security. We need to recognise the synergy between food security and several of the goals, especially Goal 11 on cities and human settlements, and Goals 6 and 7 on water, sanitation and energy.

Promote sustainable urban agriculture and improve access to land

As the homes of the poor are usually small they have less storage to set food aside for harder times. Urban agriculture could play a significant role in managing fluctuations in food availability and support women who are unable to work outside the home. Indeed target 5a urges ‘reforms to give women equal rights to economic resources, as well as access to ownership and control over land ….’ Urban land is as vital for women’s livelihoods as is rural land. However, authorities seldom recognise this. Many urban migrants, men and women, tend to have good agricultural skills but there is less land available. However, encouraging urban agriculture for low income households would support SDG 12 to “Ensure sustainable consumption and production patterns”.

City authorities can do much to support both food security and gender equality by enabling the urban poor to have access to land for livelihood and agricultural purposes, and reconsidering their attitudes towards urban agriculture. This cannot be achieved easily, given the spiralling cost of urban land in many cities of the south. Nevertheless, urban planning policy can, and in some countries does, manage to regulate in such a way that undeveloped urban land can be temporarily put to more productive use. This requires municipal planning authorities to have strong vision and commitment to addressing urban hunger. It also requires strong governance and improved capacity within municipalities to develop and enforce regulation, such as land banking, which pushes up the cost of land and removes it from productive use.

Ensure easy access to food markets and adequate conditions for cooking

The absence of markets and the small size of low-income housing, which has limited kitchen facilities, means an over reliance on street vendors and processed ‘snack’ foods for daily calorie intake. Street foods are often more expensive, and less nutritious, than home-prepared foods. Urban household budgets also compete with other resources such as water, devoting a significantly higher share of their limited household budget to drinking water than rural households.

SDG 6 aims to “ensure healthy lives and promote well-being for all at all ages”. However, food safety can be more problematic in urban settlements, where inadequate space and services for food production and storage have implications for both individual and public health. The lack of basic water, sanitation, drainage and solid-waste disposal services makes it impossible for the poor to prevent contamination of water and food.

Reliance on street foods further exposes urban residents to higher levels of food contamination and low nutritional intake. In this respect, two SDGs are particularly relevant — SDG 6 to ‘ensure availability and sustainable management of water and sanitation for all’ may be critical in improving food safety. Targets 6.1 – 6.5 are especially relevant to enabling low-income urban people to avoid food borne disease and lead healthier lives in general. In this respect they will be more productive for the city and better able to improve their own livelihoods.

Even if food can be purchased and stored effectively, much cooking is done on open fires or kerosene stoves, both of which produce toxic fumes in small, badly ventilated houses. In this respect SDG 7 can help in its determination to “Ensure access to affordable, reliable, sustainable and modern energy for all”.

SDG 11 recognises the importance of making cities and human settlements inclusive, safe, resilient and sustainable. However, this cannot be achieved until the availability of, access to and use of food in low income settlements is recognised as a specific and urgent issue, and addressed by urban professionals not simply those engaged in agriculture.

Summary of action points for reaching SDGs on hunger:

The UN SDGs can help address urban food insecurity by targeting urban poverty, but it is not the only issue affecting food security which includes human settlements, water, sanitation and energy.
Rather than be seen as inappropriate in urban planning by city managers, low-income households should be encouraged to take up urban agriculture to alleviate hunger in cities.
Create food markets, sharing networks and urban agriculture projects to decrease reliance on street food which is often more expensive, less nutritious and more likely to be contaminated than home-prepared meals.

These are only some examples of actions that could be taken to address food security for the urban poor. However, the importance of markets and income-earning opportunities cannot be over-emphasised as it is sustainable livelihoods that will enable people to ensure their food security for present and future generations. Urban planners and similar practitioners could play a key role in achieving food security, improving food nutrition and promoting sustainable agriculture together by focusing on the plights of low-income urban areas.

[1] Maxwell, D. (1999). The political economy of urban food security in Sub-Saharan Africa.World Development, 27(11), 1939-1953.

[2] United Nations Standing Committee on Nutrition August 2013 available at: http://www.unscn.org/files/Statements/August_31-_UNSCN_World_Urban_Forum_6-_Statement_final_3108_finalfinal.pdf

[3] World Food Programme. Annual Session. Rome 20-23 May 2002 Report on Agenda Item 5 Policy Issues (http://www.wfp.org/eb)

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Tag Archives: poverty

The Trouble with Aid – Quantity, Institutions and Utopian Ideals

To end urban hunger, focus on low-income housing and settlements in cities