Fiscal Decentralization and Development

Countries around the world are increasingly recognizing the impact fiscal decentralization can have on both national and community level development. Fiscal decentralization is characterized by a shift in financial responsibility from a central government to a local municipal government. Decentralization is a key element for development because it puts power back into the hands of community members. When local communities have the autonomy to control their own resource allocation and spending, they have a greater ability to fill the needs of their specific community than their centralized government. They tend to be more efficient at delivering public goods and services, which only increases the effectiveness of their local governance system. Development should happen at the community level, driven by the people who will keep their communities functioning and productive.

According to the World Bank (WB), decentralization can occur through several mechanisms, including local self-financing, co-financing or co-production, local taxes, monetary transfers from central governments, and/or municipal borrowing. Most importantly, measuring local fiscal autonomy and management must be included when evaluating a country’s level of decentralization . Decentralization goes beyond expenditure and resource allocation data; it must be considered in the context of who makes the decisions and at what level public goods are being delivered.

Unfortunately, most decentralization studies fail to address local fiscal autonomy. Many countries have limited to no data on the decision-making power of local government bodies compared to their central counterparts. Establishing a standard way to measure progress worldwide is the next crucial step forward in decentralization efforts.

Measuring Fiscal Decentralization

Decentralization data that accounts for local fiscal autonomy is difficult to find. However, several thorough sources of data capture not only countries’ fiscal autonomy data, but also dissect how this information relates to important global development outcomes.

In a report released in 2012 titled “How Close is Your Government to Its People?” the World Bank measures fiscal decentralization by: vertical fiscal gap, taxation autonomy, unconditional transfers to local government, expenditure autonomy, and borrowing freedom. These indicators allow countries to be profiled on a holistic level, providing accurate and usable data. Some of the top fiscally decentralized countries are Hong Kong, Singapore, Switzerland, USA, and Denmark, while the bottom countries are Grenada, Guinea-Bissau, Haiti, Oman, and Samoa. This report also includes measures of political and administrative decentralization, as well as the meaning and measurement of the relative importance of local government.

Another great example of a measurement system comes from The Local Public Sector Initiative, a multi-organization collaborative project that determines how decentralization is contributing to individual countries’ efforts to achieve global development outcomes. The surveys include a variety of metrics, ranging from “Basic Country Information” to “Assignment of Functions & Expenditure Responsibilities”. Each country has a detailed profile of health and education expenditure background, sectoral decentralization, and development indicators. The researchers included the survey template and instructions alongside their completed country surveys, enabling an understanding of their framework. The survey accommodates countries with varying government structures, allowing for up to four levels of government to be evaluated. The twenty nine currently completed country surveys are a great start to a global standard of measuring fiscal decentralization.

The Next Steps in Decentralizing for Development

The most important next step in achieving fiscal decentralization is a steadfast commitment from communities, policy makers, and countries as a whole to make decentralization a reality. International efforts are not being widely adopted, and community members must advocate for their policy maker’s commitment to fiscal decentralization. For example, only nine countries in the African Union have signed the African Charter on the Values and Principles of Decentralization, Local Governance, and Local Development to date, delaying it being put into force. If a major international body like the African Union committed to fiscal decentralization, we would see large scale dramatic change in community-level development. Countries worldwide must make a commitment to decentralize their spending, balance their power and resources between all levels of government, and put autonomy into the hands of local community leaders. These efforts will pay off in achieving not only the Sustainable Development Goals by 2030, but also prosperity for communities at all levels.

 

Local Public Sector Initiative country-level data can be viewed here.

Featured image courtesy of The Hunger Project, United Kingdom.

 

 

Climate Change and Food Security

The State of Food and Agriculture 2016 has made it clear that the agricultural industry is currently at a point in time where the actions taken by farmers, development organizations, and governments today will directly affect the livelihood of millions in the future. The Food and Agriculture Organization of the United Nations estimates that “in order to meet the demand for food in 2050, annual world production of crops and livestock will need to be 60 percent higher than it was in 2006”. The remarkable challenge we have ahead of us, however, it to not only end hunger by 2030, but to also limit the impact of climate change. We must put our most sincere efforts into making our agriculture systems and local capacity as efficient and sustainable as possible.

In order to limit the global impact of climate change, it is imperative that the global temperature increase remains under 1.5 degrees Celsius. 81 nations of the world have committed to combat climate change and to adapt to its effects by signing The Paris Agreement at the United Nations Climate Change Conference. Coming into affect November 4th, the committed nations will begin efforts to limit greenhouse gas emissions, adapt their energy sources, and to enforce policies that lesson their impact on climate change.

Climate change and food insecurity are very interrelated global issues; they each are negatively impacting the other. Compared to a projection discounting climate change, the world will experience a 5-7% crop yield loss by 2050. As climate change becomes more predominant, we will see rising temperatures that limit crop growth, loss of freshwater sources that negatively impact aquaculture, and heat waves that adversely affect livestock. Likewise, agriculture contributes to at least 21% of global emissions worldwide, releasing carbon dioxide, methane, and nitrous oxide into the atmosphere. These effects will vary regionally, but by 2030 will negatively affect all four food security dimensions: access, availability, utilization, and stability.

• In South America, climate change will greatly impact hunger in less-developed regions. Much of South America will struggle in aquaculture due to fish species moving southward, much more frequent and extreme tropical storms, and species extinction. Tropical forests will be affected by water availability, and rainfed agriculture will experience higher crop losses.
• Sub-Saharan Africa will experience similar problems to South America. Because 95% of crops in this region are rainfed, the frequency of extreme wet and dry years will drastically decrease crop yields of the small farmers. Fishery employment is expected to decrease by 50%. Plants and animals will also undergo reduction in numbers region-wide.
• Climate change will alter Asia’s agricultural zones northward and will limit rice and other cereal crop yields. Many countries in Asia will see coastal flooding as well as a loss of aquaculture and freshwater resources. Similarly to South America and Sub-Saharan Africa, Asia will experience biodiversity loss.

What Small-Scale Farmers Can Do

In the midst of a problem that is generally regarded as a policy issue, small scale farmers have a large role to play in decreasing the impact of climate change on agriculture and livelihood. There are several key actions that must be taken to address the constraints on agriculture by climate change:

1. Strengthen small-scale farming systems. Farmers must learn how to adapt practices to changing climate, build adaptive capacity in implementing effective actions in changing situations, and must
2. Diversify both their agricultural production and their income sources. Farmers need to diversify their crop so as to be able to withstand weather variation. They must also spread financial risk by diversifying how they are making their living.
3. Manage natural resources in a sustainable way. Farmers must implement sustainable growing systems, such as FAO’s Save and Grow model, which cuts down fossil fuel use and doesn’t exhaust their resources. Agroecological production systems also efficiently utilize inputs (i.e. recycling biomass).
4. Improve infrastructure, credit, and social insurance. Improved infrastructure ties into more efficient farming techniques. Support to risk management and diversifying finances allows farmers to adapt to changes in their markets.
5. Reduce gender inequalities. Women face disparities in responsibilities, knowledge, and training opportunities in farming innovation. Rural women also face an increased workload when freshwater becomes scarce.

Though small-scale farmers may disproportionately bear the financial burden of reducing climate change impact, it is important to state that the costs of doing nothing greatly outweigh the costs of implementing these interventions. FAO’s Director-General Jose` Graziano da Silva believes “We have the opportunity to end hunger within our lifetimes. This is the greatest legacy we can leave to future generations”. Our actions today can lessen the impact of climate change and ensure a productive food system for the future.

A Call to Action

In September 2016, the United Nation’s High-Level Panel for Women’s Economic Empowerment released its first report on the actions necessary to close the global gender gap in economic empowerment. The report, “Leave No One Behind”, emphasizes the unfair circumstances that disproportionately affect women in the workplace, i.e. wage gaps, job security vulnerability  associated with informal work, and lack of women in leadership. It also urges all economic actors to take the actions necessary to achieve economic gender equality.

Why Pursue Women’s Economic Empowerment?

The High-Level Panel is calling on governments, businesses, and development organizations to empower women as agents of change for their own economies. This contributes to achieving Sustainable Development Goal (SDG) 8, to “promote sustained, inclusive, and sustainable economic growth, full and productive employment, and decent work for all”.

In the current global labor force, women are less likely to be participating in paid work compared to men almost everywhere globally, as “only one in two women aged 15 and over is in paid employment compared with about three in four men”. Not only do women earn less than men on average, but women also “take on more than three times more unpaid work and care than men”. They tend to work in the informal and agriculture sectors, which are less secure and protective of workers rights than male-dominated sectors, i.e. government and public sectors. 

Women are under structural pressure to sacrifice both education and paid work opportunities in order to support their families at home with childcare and housework (view a UN fact sheet on this here). Additionally, when women do have paid work while having a family, their wages are subject to gender discrimination. A fatherhood pay premium exists where “men’s earnings increased by more than 6 percent on average when they had cohabiting children while women’s earnings decreased by 4 percent for each child”. These double standards are crucial to overcome if we want to empower women in the global workforce.

Priorities

In order to create a sustainable, permanent impact on women’s economic empowerment, we must prioritize the seven drivers of change (the outer wheel) identified by the High-Level Panel: 

Changes must be made in all four work sectors (the inner wheel, consisting of: agriculture, enterprises, the formal sector, and informal work) in order to achieve women’s economic empowerment. Economic gender equality is associated with human development as a whole, higher income per capita, faster economic growth, and stronger national competitiveness. These advances are critical to achieving SDG 1, to “end poverty in all its forms everywhere”.

Recommendations

Unequal pay and discrimination must be eradicated in every economic sector, and women must be represented in leadership roles at every level. In the formal sector, governments must not only provide protection in hiring, maternity, and wage situations, but must also ensure that women’s organizations are given full representation. Businesses must support women’s enterprises and women as role models in their own organizations. Both civil societies and international development institutions must increase women’s participation, leadership, and mentorship. They must include gender-specific strategies to achieve the Sustainable Development Goals by 2030.

Women’s economic empowerment is crucial to achieving gender equality and the Sustainable Development Goals by 2030. The UN High-Level Panel on Women’s Economic Empowerment has officially called on the world’s economic actors to achieve women’s economic empowerment, and we must work to end discrimination in the workplace for all women worldwide.

7 Drivers image courtesy of UN High-Level Panel on Women’s Economic Empowerment.

View the original presentation of the UN High-Level Panel’s first report here. 

Image courtesy of thp.org.

Until recently, the human rights of half the world’s population – women – were not universally protected, nor accepted in most parts of the world. In 2014, the United Nations (UN) released a publication, “Women’s Rights are Human Rights,” to further the international understanding of women’s human rights. The framework outlines key areas of women’s rights that must be addressed by all states around the world.

In 1948, the UN established in the Universal Declaration of Human Rights that all human rights applied to both men and women, using inclusive wording that eliminated the question of human rights applying only to men. The International Covenant on Economic, Social and Cultural Rights of 1966 and other human rights treaties followed suit to be more inclusive of women in both its wording and the rights it guarantees (i.e. marriage rights, maternity and child protection, etc.). An official declaration of women’s rights was officially adopted in 1967 by the UN titled the Declaration on the Elimination of Discrimination Against Women, proclaiming discrimination against women as a barrier to “the full development of the potentialities of women in the service of their countries and of humanity”.

Out of the fact that women’s rights are indeed human rights, women’s rights have become more widely understood as inalienable and of utmost priority for international development.

There are several key priorities toward the advancement and inclusion of women globally:

• Identifying and citing private party violators of women’s rights, (i.e. individuals, small organizations, businesses, etc.)
• Standardizing women’s rights – regardless of culture and traditional customs and practices
• Ending discrimination that neglects women and prohibits their decision making influence, as well as their social and economic empowerment

Advocacy has a huge role to play in the achievement of gender equality. Sustainable Development Goal (SDG) 5, which is to assure we “achieve gender equality and empower all women and girls”, specifically targets several ways in which we can end gender inequality. We must end discrimination against all women, eradicate violence against women, ensure the opportunity for women to be leaders and decision-makers, protect all women’s right to reproductive and sexual health, guarantee women’s economic rights, and certify that the legal systems in place can protect these rights. Below are eight human rights that must immediately be achieved in each country to ensure the achievement of gender equality internationally.

1. Education – Barriers to universal education must be eliminated. This includes child marriage, teen pregnancy, child labor, discriminatory policies, poor access to schools, and cultural tendencies.
2. Political Roles – Women should not only have the right to vote, but also be constitutionally allowed to run for government office. (See SDG 5.5)
3. Sexual and Reproductive Health Rights (SRHR) – A women should be able to receive sexual and reproductive health care wherever she lives, including family planning and informative services. This care must also be provided by trained and safe providers. (See SDGs 3.7, 3.8, & 5.6)
4. Adequate Standards of Living – Women must have access to basic resources such as food, clothing, and housing. These resources ultimately affect a woman’s economic prosperity, lifelong health, and her social capital. A food security system and economic opportunities must be in place to achieve adequate standards of living.
5. Prevent and End Violence Against Women – Often occurring from entrenched patriarchy, violence against women further burdens vulnerable and impoverished populations. Victims of domestic abuse, female genital mutilations (FGM), and rape suffer severe psychological and health repercussions that can hinder development advancements. States must prioritize preventing violence against women and girls. (See SDG 5.2)
6. Immigration and Displacement Protection – States involved in the origin, travel, and destination of migrant and displaced women should all be held accountable for protecting women against harm. Migrant and displaced women are at a higher risk of physical and sexual abuse, discrimination, depression, forced prostitution, and unacceptable working conditions due to their citizenship status.
7. Protection in Conflict and Crises – Conflict can normalize and amplify the mistreatment of women, who are “often used as a tactic of war”. Woman are more vulnerable to rape, sexual violence, trafficking, and other human rights violations in these situations. Legal action and victim protection must be available and effective to protect women in these situations.
8. Access to Legal Assistance and Justice – To achieve gender equality, we must have effective and accessible law and justice procedures to protect women at the local, national, and international level. Justice systems must be non-discriminatory, accessible to all women, and states must make it a priority to educate both women and law officials on the rights women are entitled to. (See SDG 5.c)

Women are capable of lifting their families, communities, and countries out of poverty. They have the ability to change the world if their human rights are recognized as not only important, but inalienable. We must ensure that humans rights are inclusive of women globally and that they enable women reach their full potential as agents of change.

To learn more about the SDGs, click here.

Image courtesy of UN News Centre.