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Extreme Poverty in Bangladesh: Lesson Learning and Reflections

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Background

• Extreme Poverty Programme (2008-2015)

• Challenge Fund that works with 36 partner NGOs

• Aim: to assist 1 million out of extreme poverty

• Core components: scale fund, innovation, lesson learning and advocacy

Background

Bangladesh: Poverty trends and dynamics• Continued reduction in proportion of

people living in income poverty (75% in 1970s to 40% in 2005 to 31.5% in 2010).

• Contributing factors: stable growth rates, relatively low inflation, inward remittances, expansion of infrastructure, new employment opportunities, improvements in human development indicators

Poverty trends and dynamics

• But numbers living in poverty (31.5%) and extreme poverty (17.6%) are still very high;

• Impact of rising inequality is an unknown;

• Regional variations highlight familiar and less familiar spatial dimensions in the distribution of (rural-urban; east-west; ecologically fragile locations);

Poverty trends and dynamics

• Convergence of poverties: upazilas with highest levels of poverty likely to be more prone to natural disasters; have lower agricultural wages; show lower levels of education attainment and have limited access to markets and….. Have greater concentrations of ‘extreme poor’ (BBS 2009)

Characteristics of Extreme Poverty• Asset base eroded total worth of all assets

averaged 2286 Taka, average 2,700 Tk income

• Acute malnutrition, especially among children 85% of children wasted, stunted, anaemic, underweight.

• Chronic health related problems (34% with chronic illness/disability)

Characteristics of Extreme Poverty• Exclusion from basic services, safety nets, • Insecure access to labour markets, often

compounded by seasonality• Vulnerability to climate change impacts• Exposure to risk and stresses• Low levels of self esteem and aspiration• Absence of effective voice• Significantly female in all the above (40% as

opposed to 10% nationally)

Characteristics of Extreme Poverty

All of the above reflect different causes:

• Spatial

• Pockets

• Idiosyncratic (eg. disability, mental health, elderly, orphaned children)

• Systemic

Differences Between Poor and Extreme Poor?

1. Extent of structural disadvantage, specifically, social remoteness to effective intermediation

2. Severity of poverty effects

3. Accumulation of poverty effects

4. Impacts (immediate) and reproduction (over time) of poverty effects

Translating into adverse trade-offs: time preferences, household dynamics etc

Usual Assumptions for Poverty Reduction• Capacity of poor for counterpart action• Access to market/labour opportunities and services• Intergenerational transfers and sustainability

(graduation and empowerment) • Relatively low discount rates (partly a function of

wider economic and political stability)

Many of these are unreal for the poor of Bangladesh and even more for the extreme poor

Standard Strategies for Poverty Reduction in Bangladesh• Group Mobilisation and Individual Entrepreneurship

(GMIE)– replacing earlier subsistence improvement approaches

• Standard Strategies are dependent on assumptions above and

• Has led to lower prioritisation of extreme poor for whom these assumptions are unreal; and who experience greater vulnerability, uncertainty and social isolation

• Excluded because ‘hard to reach’

Principles for Engaging with Extreme Poor: a blended approach

• Ensuring sufficient present security to enable people to start planning in the future through direct support for sustainable subsistence

• Combining present survival with future provision for children

• Supported by safety nets, insurance and social protection to cope with vulnerability, uncertainties, hazards and shocks

New Holistic Policy Mix

• Support for existing household subsistence via acquisition of small scale productive assets

• Support to expand/strengthen fragile labour market opportunities

• Addressing present primary health needs• Access to safety nets (cash or food in kind), insurance

provisions supported by state entitlements, micro finance etc.

• Conditional cash transfers to ensure quality schooling for children

The Case for Social Protection

• The new policy mix still assumes some capacity for household counterpart economic action and supportive local environments.

• Where these conditions do not apply (spatial concentrations, idiosyncratic or dependent extreme poverty and some urban contexts), the need for unconditional transfers and full social protection is imperative.

Sustainability - Towards a New Policy Settlement• Need for a transformational and pro-poor

political settlement which embraces prevention, protection and promotion

• Need to co-locate primary health care with other interventions to lower discount rates

• Need to prevent inter-generational reproduction of EP through co-location with other interventions of education and training: primary, secondary and apprenticeships

Sustainability : a pragmatic as well as moral concern• Social policy requires moral and pragmatic

concessions to ensure inclusive and stable society

• Acknowledge expansion of middle classes and their responsibilities

• Politicians have to take the lead: expanding tax base depends on good governance, thus greater legitimacy to tax and spend in redistributive manner

Being Civilised and Pragmatic

• Social policy requires moral and pragmatic concessions to ensure inclusive and stable society

• Politicians have to take the lead: expanding tax base depends on good governance, thus greater legitimacy to tax and spend in redistributive manner