Urban poverty deserves more attention: economist

The government needs to pay attention to urban poverty alleviation and policymakers need to take long-term and sustainable measures to combat the problem, a leading economist said yesterday.

“We lack sustainable measures to eradicate extreme poverty in the urban slum areas. Instead of taking intermediate steps to eliminate poverty, the government needs to make long-term policies to fight poverty at large,” Binayak Sen said.

“Simultaneously, we have to overcome the present culture of ‘tokenism’ in programmes taken by the government to alleviate poverty. Most of the time, the allocations are very poor and hence, do not make any difference.”

The government needs to rearrange the size of allocations it makes under different safety net programmes, pointed out Sen, research director of BIDS.

He suggested the government ensure better access to capital and healthcare, so the urban poor living in slums can improve their livelihood and quality of life.

He also stressed the need to create sustainable income generating activities for these people.

Sen was presenting the insights from the midterm evaluation of a project titled Breaking the Cycle of Urban Chronic Poverty, jointly organised by the Dustha Shasthya Kendra (DSK), a non-government organisation, Shiree and UK Aid at the Samabai Bhaban in Dhaka.

The DSK-Shiree project conducted the survey on 1404 people living in Kuril and Kamrangirchar in Dhaka, where the project spent Tk 28,000 for each person over a period of two years.

The survey found that the additional income has made a qualitative impact on the targeted people, improving their standard of living. It also found that the notion of extreme poverty is gradually disappearing in these areas although a qualitative difference is yet to be perceived.

Bangladesh on a rising tide

Noted economist Binayak Sen said Bangladesh is now on a rising tide; there are a few countries in the world that are both rising socially and economically.

Sen was speaking at a national seminar on rural employment opportunities at Bangabandhu International Conference Centre styled ‘Sharing of REOPA experience, results and lessons learnt’.

The project, REOPA (Rural Employment Opportunities for Public Assets), is a social safety net programme arranged by the Local Government Division with United Nations Development Programme (UNDP) and European Union (EU) as development partners.

Sen said development should not be measured from economic data alone; rather, it should consider the confidence levels or helplessness of the people. These are not considered in the Millennium Development Goal (MDG) of the United Nations, he said.

He also said if the local governments work well, then the social safety net programmes will work better.

The REOPA project is ending this December and the seminar was arranged to share experiences, results and the lessons learnt, with project stakeholders. At the seminar, a report was also published.

Speakers at the programme highly appreciated the people who implemented the workforce, as it was a successful one. A beneficiary of the project, Nurjahan Begum of Belkuchi in Sirajganj district, expressed gratitude as she is now a self-employed woman. She makes compost fertiliser at home.

In response to a question, she said she wants to see herself as a local government representative in the future. A number of women of her village are self employed under this project, she added.

The REOPA project was designed to respond to the needs of the most vulnerable groups of people in rural Bangladesh. It focused on generating employment and alleviating poverty through effective local government institutions, community partnerships and pro-poor service delivery, said Goran Jonsson, international team leader of the project.

Jahangir Kabir Nanak, state minister of the local government, rural development and cooperatives ministry (LGRD), said 15 percent of the national budget is allocated for the social safety net programmes, where more than 80 programmes are currently going on.

Abu Alam Md Shahid Khan, LGRD secretary, Milko Van Gool, head of cooperation of EU, and Stefan Priesner, country director of UNDP, also spoke at the programme.

Binayak sees no step to cope with prices

Dhaka, June 10: Terming the budget for the next fiscal realistic renowned economist Dr Binayak Sen felt that though there are concrete measures in the budget for internal revenue mobilization, mobilising external resources would be a major challenge for the government. He also said many new taxes were imposed to achieve the internal revenue target. Talking to The Independent on Friday Dr Sen also noted that the budget lacked emphasis on decentralization of the public expenditure which he felt was crucial to address the challenges of budget implementation.

‘At least 10 per cent of the budget should be devolved to the local government” he said.
Focusing on the revenue mobilization measures, he said, many new taxes have been imposed to achieve the internal revenue target.

“Once upon a time the revenue mobilization capacity of the country was poor but the government has made significant development in this sector,” Dr. Sen told The Independent. He felt that though the role of foreign aid was going down with the passage of time, concessional foreign loans played a crucial role in the economy during periods of uncertainty.

In this connection he mentioned that during the fiscal uncertainty in 2007-08, the then government had managed to get concessional foreign loans from the World Bank which helped it to face the crisis.

“FDI is a major source of external resources but one cannot attract FDI overnight as it requires a long time strategy. The governments needs to concentrate on it,” he added.

He also felt that the budget lacked guidelines to cope with the rising prices of commodities. The government needs to formulate a strategy to absorb the shock of the high prices of food, oil and instability in the foreign exchange sector.

Dr. Sen, however, observed that lack of preparedness resulted in the recent crash in the capital market. In this connection he mentioned that former finance minister late Shah ASMA Kibria had an advisory council which used to advise him on economic management on a regular basis but the present government does not have any such council.

‘The government should use the expertise of the economists on a regular basis through such a council,” he suggested adding that such institutional mechanism helped a lot during crisis periods.

Sen proposed an alternative outlook to expedite project implementation by prioritizing seven to eight sectors identifying a few projects under these sectors instead of the present culture of identifying over 800 projects in the budget and then facing non-implementation over 40 percent of these projects.

He further offered a formula to implement at a faster pace by decentralizing the annual development project and allocate Tk 1 crore performance incentive to the newly-elected union parishads which perform well in revenue generation and project implementation.

He proposed that the government should introduce health insurance at the mass level like in neighbouring India where the government contributes the funding but implements it by private companies.

“The government could solve many of the acute problems like nutrition and family planning if it set cross conditionality for the people who are already served by the government under the social safety net,” he suggested.

Explaining his satisfaction over the fast pace in reducing poverty he said, ‘This is our economic strength. If the global shocks like high commodity and high fuel prices, low external assistance were not there, the GDP growth rate could be over 7 to 8 per cent in the current fiscal year.”