Bangladesh has shown remarkable success in poverty reduction and achievements against various social indicators. Still some 25 million people, or 6 million families, live in extreme poverty (HIES 2010). These people are not integrated into the mainstream economy and have no means to earn their own living.
The Manifesto for the Extreme Poor, a civil society document launched last year, called for the complete eradication of extreme poverty from Bangladesh by the end of 2021. 200 organisations across the realms of NGOs, private sector companies and donors, have endorsed the Manifesto and expressed their solidarity with the cause: the economic empowerment of the extreme poor.
Our planning minister pledged his support and promised to make Bangladesh the first nation in South Asia to eradicate extreme poverty. He said he will commit his ministry’s resources and efforts to support those projects and partnerships necessary to achieve this objective. He said the eradication of extreme poverty would be a priority agenda in the 7th Five Year Plan. He also referred to Prime Minister Sheikh Hasina’s previously stated goal of the eradication of poverty from Bangladesh by 2021. Others, such as Rashed Khan Menon and ICT State Minister Palak have also pledged their commitment. All their pledges are available on youtube.
In the national budget announcement last week, the finance minister committed to eradicate extreme poverty from Bangladesh by 2018! He allocated Tk1,500 crore to extreme poverty reduction programmes. These are very positive commitments and they are progressive, redistributive and exhilarating. We are talking about making some real, rapid changes to benefit the most excluded people of our nation. What an exciting time to be in Bangladesh! So what are the next steps?
The Manifesto for the Extreme Poor, developed through an inclusive and consultative process, has suggested a strategy drafted by experts within its pages. It suggests three actions. The first action is to give extremely poor families a transfer of an income-generating asset or skills training to enable them to earn a living. This transfer should be targeted to reach the right people. To achieve the goal of eradication by the end of 2021, one million families need to be given this transfer every year for the next six years. So let’s do it!
Reaching the poorest
This is doable but radical steps need to be taken. The poorest are “invisible and silent,” living in hard-to-reach areas and evidence shows that much of the safety nets allotted to the poorest do not reach them. Shiree, a livelihood programme that is lifting one million people out of extreme poverty, works with a mobile-based monitoring system called the CMS (Change Monitoring System) developed in partnership with a local firm, MPower. The shiree CMS baseline survey (2009) showed that out of one million extremely hardcore poor beneficiaries, only 20% received any support. (And of course, that support was not sufficient to make any transformational change).
I am curious to know more about the finance minister’s plan. Evidence does not suggest that extreme poverty will be eradicated by 2018 unless some radical steps are taken. Are these steps going to be taken? How will our finance minister ensure that the Tk1,500 crore allocated to the extreme poor will actually reach the poorest? The plan should be made public and placed under the scrutiny of suitable experts. The social protection budget is high, 2.3%, which is great news, but let’s make sure it is used in the best way possible.
Databases
We need a system in place to identify the 25 million people in Bangladesh who are extremely poor. We need to make sure they receive the transfers they are eligible for and we need to ensure that the transfers are creating the outcomes we want. We need technology to enable us to execute this plan with precision, accountability and speed. The technology is available to allow levels of extreme poverty at union level to be generally available and hence for union chairmen to be held accountable as having a pivotal role in the rapid reduction of extreme poverty.
Currently the World Bank is working with the government to create a database for people living below the higher poverty threshold. DFID is planning to work with the ministry of finance to develop a database of people who are in the safety nets. WFP is working at the upazilla level to identify regions with high levels of poverty that need to be specifically targeted. These are positive steps.
Change Monitoring System
CMS allows shiree to track all its beneficiaries (census, not sample basis) to identify who is successfully climbing out of poverty and who need some more assistance. This makes it possible to target easily and adjust support as necessary. Perhaps this sort of monitoring system needs to be put in place nationally. With the drive of the recent Digital Bangladesh Fair and the global buzz around it, I believe this is something we could roll out easily to track the six million families who are extremely poor and in need of immediate help. Such innovative use of technology for development may be just the tool needed to win us another nobel prize, not to mention global recognition, greater economic growth, a more inclusive nation and national pride!
Giving the poorest assets or skills
A handful of program mes working with the extreme poor in Bangladesh (including shiree, BRAC-CFPR, CLP, REOPA, FSUP, Nobo Jibon) have had great success. These “pilot” programmes can offer best practices and models that work and should be replicated and scaled up. The government can partner with them, and with donors, to implement the transfers through the already extensive network of NGOs in the country. Large government projects such as Ekti Bari Ekti Khamar should be brought into the extreme poverty targeting effort. Local government offices should partner with NGOs and private sector companies. Union Chairmen should have a database of the extreme poor in their union, and they should be rewarded monetarily for every 10% of extreme poverty reduced in their area.
CMS technology will allow the government or implementing agency to identify and track the economic empowerment of all the extremely poor people who are eligible for benefits. This can be used across the Ministries of Disaster and Relief and for safety nets. If a family is failing to climb out of extreme poverty, the technology will identify them so extra support can be sent in.
Nothing here is rocket science. Shiree estimated the cost of lifting one million families out of extreme poverty a year, for the next six years, at 3 billion dollars. This is not an exorbitant amount for such a goal. Let’s not forget that as the extreme poor climb onto the economic ladder, this will create multipliers of growth within their communities which will ripple out to a national scale. We are already growing at a fantastic rate. We can make the growth fully inclusive. If we can do this efficiently, every other developing country will follow.
Access to services
The second action necessary as outlined by the Manifesto for the Extreme Poor is to ensure access to public services and social protection transfers. Ensuring access to health, education, agricultural services, livestock and fisheries services, etc, are essential to create sustainable change. Here again, digital monitoring technology can enable the government to keep an eye on which families, or more broadly, which unions or regional organisations, need more attention. For social protection, there is already a strong commitment to reform and this needs expediting.
Illnesses or health shocks are the biggest creators of extreme poverty. The poorest are more susceptible to illnesses as they are chronically malnourished and often working under hazardous conditions. Illnesses wipe out their minimum ability to earn money from physical labour and loans taken to pay for a single treatment can throw a poor family into debt for the rest of their lives. Thus, health services reaching the poorest, and education to break the intergenerational transfer of poverty, is critical to success. An audit of the role of health and education services in targeting the poorest is needed.
Policies
The third action outlined in the Manifesto relates to pro-poor policies. This includes strategies to encourage fair wages and safe working conditions, mobilise CSR funds, provide wide-scale vocational training and enhance routes for the extreme poor to graduate into formal employment opportunities. The finance minister must stimulate job-creating, eco-friendly investments in depressed regions. With over eight million extremely poor youths in Bangladesh, policies should encourage the private sector to tap into the talent of an expanding labour force. Gender dimensions are critical and need to be handled with special attention if we are truly to eradicate extreme poverty and maintain a balanced society.
We have the knowledge, we have the resources, we have the national and political will. Now we need to see some rapid, high quality roll-out of services and transfers. The time is right. As the legendary venture capitalist Morten Lund, co-founder of Skype, said when he visited our Digital Fair last month, “It is exciting to be in a country where the economy is growing at 7.5%. Bangladesh has the technology and know-how to eradicate extreme poverty and ensure that growth is fully inclusive. Youths here are passionate and hard working. I look forward to watching where this country goes next!” Morten Lund was in town to promote Coder’s Trust, a project which will link one million Bangladeshi youths to online jobs.