Changing PIC populations: impacts on public finance, labour markets, and poverty

Transcription

1 Plenary 2 Changing PIC populations: impacts on public finance, labour markets, and poverty Professor Wadan Narsey School of Economics Faculty of Business and Economics The University of the South Pacific Narsey_w@usp.ac.fj [Regional Symposium on Population and Development: Accellerating the ICPD Programme of Action, UNFPA and USP. AusAID Lecture Theater, 23 to 25 November 2009] 1

2 This symposium is titled Regional Symposium on Population and Development: accellerating the ICPD Programme of Action. This RSPD is taking place some 15 years after the 1994 Cairo meeting which agreed on the Plan of Action (PoA). Since the Cairo meeting there have been many international focal points for concerted policies: The Year of this or The Year of that etc. In recent years, international discourse is dominated by a focus on the Millenium Development Goals (MDGs) some of which are common to the ICPD Programme of Action but each has elements that the other does not. Geoffrey Hayes study for the UNFPA ICPD@15: Achievements, challenges and priorities in the Pacific Islands which will be launched this evening, has a good overview. Please read it carefully. One conclusion reached globally and for the Pacific is that the need to slow population growth has not received the priority that it ought to have had, given the extremely powerful constraints that high population growth places on development. This presentation therefore tries to bring out the the major implications of current PIC population growth patterns, for future pressures on public finance, household welfare 2 and poverty, noting worrying future pressures for some PICs, but positives for others.

3 If you asked the expert economist demographers to talk about the long term demographic impacts on economic welfare Professor Naohiro Ogawa (who unfortunately could not come to this RSPD and be speaking instead of me) (and Chawla and Matsukura) or Andrew Mason (and Sang Hyop-Lee) would focus on the two demographic dividends that economies can enjoy because of the demographic transitions that are taking place: If Y = Income, N = Total Population and GDP per capita = Y = L * Y N N L L = No of Productive Workers Workers per population (Support ratio) Income per worker Productivity per worker When each increases, 1 st Demographic Dividend 2 nd Demographic Dividend The theoretical and empirical results are fascinating for demographers and economists But if we go through all their numerous equations, some of you would be dozing off. 3

4 This presentation tries to convince ordinary people and policy makers with the data that is available from our Bureaus of Statistics (a) (b) (c) (d) (e) (f) That PIC GDP growth rates are not healthy enough to cope with population growth That under-employment and unemployment is so severe for some PICs that dependency ratios or support ratios must be used with great caution when looking for the 1 st Demographic Dividend or 2 nd Demographic Dividend that some PICs population growth trends are going to impose extremely heavy financial burdens on the public finance systems and governments, but some PICs population growth trends will allow real easing of public finance pressures, with the potential for economic growth to bring about improvements. that at the household level, families can enjoy better standards of living were they to have fewer children, and conversely, that larger household sizes tend to push households into poverty. that that households with fewer dependents improve savings ratios and accumulation, assisting the 2 nd Demographic Dividend at the household level and at the national level. 4

5 Policy implications There is urgent need 1. For solid demographic and economic projections, and related socio-economics research that support 2. the need to re-establish a strong national focus on family planning as an essential long term strategy for development, given the significant macro impact at the national level, 3. For national compaigns that can convince fertility decision makers at the household level on the urgency to reduce fertility, given the positive microeconomic impacts for household welfare. 4. To strengthen regional institutional capacity and perhaps begin new initiatives to address population and development issues. 5

6 Acknowledgements SPC PRISM population database and projections. The excellent Household Income and Expenditure Surveys, made available by the Bureaus of Statistics in Fiji, Vanuatu and Solomon Islands. I thank all their Government Statisticians: - Timoci Bainimarama - Simmil Johnson - Nick Gagahe And their support staff. Our lowly paid Bureaus of Statistics technical and professional staff are just not appreciated enough in the region- by governments and donors how about a recommendation in our Final Communique? 6

7 Why use projections from 2005 to 2015? Usually, demographers give long-term projections for thirty or fifty years: the usual public reaction: that s too far into the future; let the future generations worry. But the projected values from 2009 to 2015 give a sense of what to expect over the very next 6 years, a realistic planning horizon for Governments in power And for professionals associated with policies linked to demographic changes: they are usually around for at least 6 years in the same field. And the values from 2005 to 2009 allow policy makers to place their future expectations in the context of the demographic changes and the impacts they should have already experienced over the last four years also happens to be the target year for MDGs, and 7

8 Current projections: great diversity in total populations of PICs With almost 7 millions, PNG is in a class of its own: the changes in absolute terms are staggering, relative to other PIC, with Tuvalu having around 10,000 PNG Annual increase approx. = 150,000 > populations of Tonga, Kiribati, Marshalls, Tuvalu Increase in PNG population from 2009 to 2015 = 895,000 which is > current pop. of Fiji Population (selected PICs) (000) PNG Fiji Solomon Is Vanuatu Samoa Tonga Kiribati Marshalls Tuvalu

9 Remove PNG, and Fiji and Solomon Is stand out Note dramatic increase in Solomon Islands (red line below) Change in pop to 2015= 86,000 > pop. of Marshalls and Tuvalu combined Population (selected PICs) (000) Fiji Solomon Is Vanuatu Samoa Kiribati Tonga Marshalls Tuvalu 9

10 Remove Fiji and the Solomons: left with medium sized and micro countries Vanuatu stands out, with rapid growth (top line in graph) And Kiribati also with high growth, overtaking Tonga in total population Population (selected PICs) (000) Vanuatu Samoa Kiribati Tonga Marshalls Tuvalu

11 Index Numbers of Population (2005= 100) indicate great growth diversity Solomon Islands, Vanuatu, PNG and Kiribati are the high growth countries Marshall and Fiji are moderate growth countries While the others will have low growth or stagnant populations. Index Numbers (Total Population) 2005 = Solomon Is 125 Vanuatu 120 PNG 115 Kiribati 110 M a rsha lls Fiji 105 Tuvalu 100 Tonga Samoa 11

12 Total Percent Changes in Population from 2009 to 2015 Melanesian Vanuatu, Solomon Islands and PNG are facing very large increases. Major implications for public finance (education, health, housing, infrastructure), labour market entrants Major implications for countering poverty. Those with smaller population increases will have some leeway for development. Percent. Change in Population 2009 to 2015 Vanuatu Solomon PNG Kiribati Marshalls Fiji Tonga Tuvalu Samoa

13 At crude macro level: ability of the economies to support these population changes depends largely on GDP growth rates relative to the Pop. growth rates If the GDP is not growing faster than the growth of population then the economy will be struggling to satisfy the needs of the growing population. PIC GDP growth rates (averages for 1990 to 2007 or 2008) (ADB data): are not impressive, compared to Mauritius (5%), India (7%) or China (10%). Av. GDP gr * Pop gr GDP gr - Pop.gr Fiji Kiribati Marshalls PNG Samoa Solomons Tonga Tuvalu Vanuatu

14 (Av.GDP gr Av.Pop gr) : indicated by GDP per capita Great variance amongst the PICs Tuvalu and Samoa look to be in a strong position generally. Moderate capacity for PNG, Tonga, Fiji and Vanuatu While Marshalls, Solomons and Kiribati will be under some pressure. GDP gr - Pop.gr Tuvalu 5.0 Sam oa 2.3 PNG 1.6 Tonga 1.5 Fiji 1.3 Vanuat u 1.1 Kiribati 0.6 Solomo ns 0.3 Marshalls

15 But GDP pc growth rates are not good enough as indicators of well-being Especially when the benefits of economic growth are not distributed evenly - between rural and urban areas whose populations grow differently - richer and poorer households Higher urban rates of growth than the population rates of growth may requires major public sector investments in water, sewerage, roads, electricity, health services. When there are different burdens posed by the young and the elderly who do not produce, but rather consume And the relative proportions of the young, the elderly and the productive are changing significantly over time. The demographic dividends approach tries to encompass such perspectives. 15

16 Demographic Dividends arise from age structural transitions Both dividends depend on the reality that individuals in a population are either net consumers or net producers. Normally -from the time of birth to some age (usually 14 years of age or below) individuals may consume more resources than they produce- they are net consumers. - then at some age (usually 15 upwards), they tend to produce more than they consume- ie they become net producers. - and at some elderly stage they become net consumers again (after 64? or 60?) Demographers typically take (0 to 14) and (over 64) as rough indicators of net consumers or dependents ; and (15 to 64) are assumed to be net producers Examine when the dependency ratio = [(0 to 14) + (15 to 64)] / [15 to 64] begins to fall below some critical level. Or the Support Ratio = (15 to 64)/Total Population begins to rise. 16

17 The Dependency Ratio, Support ratio and the 1 st Dividend A rough guideline for the 1 st Dividend to begin to work is When the dependency ratio = [(0 to 14) + (> 64))]/(15 to 64) falls below 0.5 Or when the support ratio (15 to 64)/Total Population begins to rise (The dependency ratio is roughly the inverse of the support ratio. But both indicators have problems for PICs: First, large proportions of the people (15 to 64) are not fully productive. Second, the growth in numbers of working age population is not matched by actual growth in numbers employed. Especially not in Fiji, Vanuatu, Solomons and PNG. 17

18 Huge problem of Hidden Underemployment and Unemployment: eg data from FIBoS Employment and Unemployment Survey Fiji formal employment in 2004 (Annual Employment Survey) 122,000 But The FIBoS Employment and Unemployment Survey indicates That waged and salaried persons, and employers 198,000 No aged 15 to 54 (excluding household workers) 350,000 ADB database says that the Labour Force is around 330,000 While Formal Unemployment supposed to be between 6% and 12% (2007 Census) Effective Unemployment (including all the underemployment) = 26 % 18

19 I Vanuatu 2006 HIES data reveals: effective unemployment: 40% Curr Work Status Persons Av. Hours Worked per week Eff.Rate of Unemp Working for Pay/Profit Family Bus./No Pay OtherWork/No Pay Subsistence Looking for work Above total The average hours worked per week are extremely low for all categories: average 26. But only 20 hours per week for subsistence workers. Nationally, the under-employment and formal unemployment amounts to an effective 40% rate of unemployment- large even if statistical weakness allowed for Way above the official rates of unemployment (unemployed and looking for work ) Similar situation in Solomon Islands and PNG. 19

20 Unemployment problem especially acute for Youth aged 15 to 19 and 20 to 24 Source: Vanuatu 2006 HIES Average Hours per week worked by different age groups and Categories of Workers: Note extremely low averages for Subsistence Workers (15 to 24): just 20 hrs per wk. i.e. large proportions of 15 to 64 are not productively employed What do they do with the rest of their time? Links to crime? VAW? High rates of STIs? 40 Average Hours Worked Per Week (Vanuatu) 2006 HIES) A Pay/Profit B No Pay C Subsistence to to to to to to to 74 Age Groups 20

21 Macroeconomic effect of such high rates of effective unemployment? Any economy where some 25% to 40% of the workforce are not engaged in productive work, must have relatively low values for GDP per capita (as we do in the PICs) Support ratios [(15 to 64)/Population] will severely overestimate the ratio of productive people to total population; and dependency ratios will be biased downwards; Hence the 1 st Demographic Dividend will be difficult to identify Inevitably, normal economic growth (3-4%) will be unable to ensure that the potential workforce generates enough income, to look after all the needs of their families food education health (infant and maternal mortality) housing elderly Working age people and households will not be able to save and take their families out of poverty (2 nd demographic dividend will be hard to realise). Worsening unemployment must worsen other social problems: crime, VAW, STIs, etc. 21

22 Planners: the burden of the young: ratio of (0-14) to (15 to 64) Significant differences amongst PICs: but all declining High burden: Marshalls, Solomons, Samoa, Tonga and Vanuatu Low burdens: Tuvalu, Kiribati, and Fiji: implications for household welfare (below) Good trend: most are falling: but some not as rapidly as they could What role for Family Planning initiatives? Which countries to focus on? The Burden of the Young (0-14) as % of (15 to 64) 80 M arshalls 75 Solomon Is Samoa Tonga Vanuatu PNG 55 Kiribati Fiji Tuvalu

23 Planners: the burden of the elderly on the productive workforce (>64) as % of (15 to 64) Relatively high levels for Tuvalu and Samoa but rapidly rising for Fiji (light blue). Relatively smaller problems for PNG, Marshall, Solomons, and Kiribati. Key problem: very small proportions of the elderly in PICs have pension provisions. Can PIC governments look after all the elderly? But much lower ratios than Australia and NZ (12%) or Japan (20%) The Burden of the Elderly (>64) as % of (15 to 64) Tuvalu Samoa Fiji Tonga Vanuatu Kiribati Solomon Is Marshalls PNG

24 Food for thought 1: What of extra work done by females at all age groups Taking both paid work and unpaid household work, Females do some 14 hours more per week than males 31 % more work- at all age groups What does that imply for pressures on women, female inability to develop themselves professionally, female inability to enjoy leisure, resulting intra-family tensions, and possibly violence against women who assert their equal rights? Total Hours Worked per Week (Paid + HH) (Fiji EUS) Females Male All hrs (F-M) hrs. %(F-M) 15 to to to to to > All

25 Food for thought 2: what about work pressures on older women? If men are dying off 5 years before women- what does this say about the workloads on women in caring for the men in the years before they die? Note that women 55 to 64 are working 49 hours per week on average, while females above the age of 64 are still working an average of 40 hours per week. 70 Total Hours Worked (paid + hh) (Fiji EUS) Females Male to to to to 54 Age Group 55 to64 > 64 25

26 Dependency Ratios [(0 to 14) +(>64)] as % of (15 to 64) Major decline expected for Samoa, but remaining high for Solomon and Marshalls. Low and declining values for Tuvalu, Fiji and Kiribati. But none near the 0.5 mark (where the first demographic dividend is supposed to begin). Dependency Ratios 0.90 Samoa Solomon Is 0.80 Marshalls Vanuatu 0.70 Tonga PNG 0.60 Kiribati Fiji Tuvalu 26

27 But remember weakness of using Dependency Ratios As dependents we are putting together the young (0 to 14) with the elderly (>64). But the young are by and large all net consumers But while some of the elderly may be net consumers, others may have put aside own savings during the productive periods, to provide for their old age, through pensions, or accumulation of wealth. Combining both groups together in one group called dependents runs the risk of fudging the different impacts the two groups pose for their households and society. 27

28 What about the Support Ratios? (15 to 64) / (Tot.Pop.) All roughly increasing High values: Fiji, Kiribati, Tuvalu (rapid increase projected) But note extremely rapid increase of Samoa s Support Ratio For some Melanesian effectivesupport ratios would be even lower taking account of under-employment and unemployment. Support Ratios (15 to 64)/Tot.Pop Tuvalu Fiji Kiribati PNG Vanuatu Tonga Marshalls Solomon Is Samoa

29 The second demographic dividend arises when productive workers accumulate savings and wealth to increase productivity and age care support schemes i.e. when net producers use savings to invest in capital deepening which raises their productivity (both human capital and physical capital) to earn higher incomes during the rest of their productive life, and to also accumulate wealth which is then available for their old age as well as their heirs. But the effects of this wealth accumulation lasts way beyond the period of the first dividend, and can have a much bigger impact than the first dividend. Ogawa (2009): the First and Second Dividends as multiples of their average GDP gr. from 2010 to 2020 First Dividend Second Dividend Singapore (gone) 1.57 Malaysia India But problems for PICs: if huge numbers of new workers are coming into the workforce then available scarce savings and capital is used up for them, rather than increasing the productivity of the older workers And large PIC households may not be able to save 29

30 Most critical problem for this symposium and all plenaries: How to present evidence and findings that not only convince the experts in the field But far more importantly, the ordinary public at large, including political, social and religious leaders; and fertility decision-makers in households. What the implications of rapid population growth are for national well-being What the implications of rapid population growth are for standards of living of households. Start with the household level. 30

31 Dependency ratios, Nos of 0 to 20 in household, and standards of living A priori, it may be thought that the larger the number of dependents in the household, the lower will tend to be the standard of living. Given that the elderly can be income earning in their own right and the data indicates that they keep working into their old age. More useful to take the use as a proxy for dependents as the number of those aged 0 to 20 in the household. Use both 0 to 20 and dependency ratios. Question: Does the number of those aged 0 to 20 affect the position of the household in the poverty deciles? Lower (1) or higher (10). 31

32 No of 0 to 20 age group in a household and standard of living (deciles)? Vanuatu 2006 HIES: using Exp. pae deciles For Rural Vanuatu: as the no of 0 to 20 in hh increases, Perc. of the pop. in the Bottom 3 deciles increases (red line); and Perc. of pop. in the Top 3 deciles reduces sharply (black line). Percentage of Population in Top 3 and Bottom 3 Deciles Rural Vanuatu Households (2006 HIES) Bot. 3 Top Number of Persons Aged 0 to 20 in HH 32

33 And similarly for Urban Vanuatu Urban households, larger percentages of 0 to 20 year olds in the household, virtually guarantees that household will be in the bottom 30% of the urban population. And vice versa for those in the Top 30%. Percentage of Population in Top 3 and Bottom 3 Deciles Urban Vanuatu Households (2006 HIES) Number of Persons Aged 0 to 20 in HH Bot. 3 Top 3 33

34 For Fiji ( HIES) using Income pae deciles Similar patterns: the more persons 0 to 20 in the HH the lower the proportion of the households in the Top 3 deciles in the country. The fewer the number of 0 to 20 in the HH, the higher is the proportion in the Top 3 deciles Percent of Population in Top and Bottom 3 Deciles Fiji HIES Number of persons aged 0 to 20 in HH Bot 3 Top 3 34

35 Relating Dependency Ratios to Poverty Deciles The households with lower dependency ratios tend to be in the higher deciles The households with higher dependency ratios tend to be in the lower deciles Dependency Ratios (0 to 14 + >64)/(15 to 64) Fijian Indo-F PD 2 PD 1 PD 3 PD 4 PD 5 PD 6 PD 7 Population Deciles PD 8 PD top PD 9 35

36 Relating Support Ratios to Poverty Deciles (Fiji HIES) The lower the support ratios the poorer you are on the decile scale. The higher the support ratio, the higher the deciles you are likely to be in. This is the inverse graph of the previous one. Support Ratios (15:64)/(Tot.Pop.) Indo-F Fijian PD 1 PD 2 PD 3 PD 4 PD 5 PD 6 PD 7 Population Deciles PD 8 PD 9 PD top 36

37 Savings Ratios strongly linked to poverty deciles (Fiji HIES) The poorer deciles have negative savings ratios: they dis-save The well-off deciles are able to save, and presumably accumulate Perc. Savings %(Y-E)/Y Population Deciles Indo-F Fijian 37

38 How does the dependency ratio relate to savings ratio? Is there an inverse relationship? Fiji HIES indicates such a relationship- savings ratio declines as dependency ratio increases; 20 Savings Ratio by Dependency Ratio (Fiji HIES) > 2.1 Dependency Ratio 38

39 Even more well-defined: the higher the percentage of 0 to 20 in household the lower the savings ratio Fiji HIES indicates that as the percentage of those (0 to 20) in the household increases, the savings ratio decreases. Percentage Saving Ratio (Fiji HIES) Perc. of (0 to 20) in household 39

40 How do these ratios affect standards of living? Poorer deciles have difficulty keeping children at school Vanuatu (2006 HIES) Poorer households (both urban and rural) have problem in sending children to school Major differences between urban and rural households Mere 50% to 60% in lowest 3 deciles in rural households Percentage of 6 to 20 year olds at school By population deciles (separate deciles) Urban Rural RPD 1 RPD 2 RPD 3 RPD 4 RPD 5 RPD 6 RPD 7 RPD 8 RPD 9 RPD t Expenditure per Adult Equivalent Deciles 40

41 Difficulty increases as the No of 6 to 20 in household increases Vanuatu (2006 HIES) As the number of school age persons in the household increases, there is a clear decline in the percentage of 6 to 20 years old at school, for urban people definitely Rural people: low ratios to start off with, which also declines as well for larger numbers of 6 to 20 in household. Percentage of 6 to 20 year olds at school (Ni-Vanuatu only) Urban Rural Number of 6 to 20 year olds in Household 41

42 Education Expenditure per (6 to 20 year olds) Source: Estimated from 2006 Vanuatu HIES The larger the number of children, the less are households able to spend on average on each school age child taking into account that few poorer children can attend): ie the household s total investment in education reduces dramatically, as the number of school age children increases Education Expenditure per 6 to 20 year olds in HH Vatus per annum (Ni-Vanuatu only) Urban All Rural Number of 6 to 20 years old in household 42

43 Solomon Is HIES 2005: Education expenditure per 6 to 17 year olds Can see the extremely large decline in Education Expenditure per School Age Child, for the top 30% of the population (red line) once the number of school age children in the household increases Also the clear impact of poverty. Solomon Islands: Education Expenditure per 6 to 17 year old (SI$) SI$ D 1 to 3 D 4 to 7 D 8 to 10 All Log. (D 8 to 10) Number of School-Age Children Log. (All) Log. (D 4 to 7) Log. (D 1 to 3) 43

44 But also for those in the middle 40% (blue) and the Bottom 30 percent (green line) Even for the households in the Bottom 30% of the population, Ed. Exp. per school age person declines from around SI$400 when there is only one child, to a mere $100 when there are 6 children of school age. i.e. larger number of children in the family, creates downward impact on the quality of education support provided by the household Solomon Islands: Education Expenditure per 6 to 17 year old (SI$) SI$ Number of School-Age Children D 1 to 3 D 4 to 7 D 8 to 10 All Log. (D 8 to 10) Log. (All) Log. (D 4 to 7) Log. (D 1 to 3) 44

45 Fiji: Percentages of 5 to 20 year olds at School (by poverty Deciles) Only 80% at school in the lowest 30 % of the population. Compared to more than 90% for the top 30% Percentage of 5 to 20 year olds at school Urban All Rural 70 PD 1 PD 2 PD 3 PD 4 PD 5 PD 6 PD 7 PD 8 PD 9 PD top Income pae deciles 45

46 And Education Expenditure per Student: Fiji HIES The decline is especially dramatic for those in the top 20% of the population Q5 (from over $800 to less than $200 per student) Clear impact of poverty Education Expenditure Per Student (by quintiles) Number of 5 to 20 year olds in household Q5 Q4 Q3 Q2 Q1 46

47 But also for Bottom 40% of the population (Q1, Q2) i.e. quality of education support declines with increase in numbers of school age children in household for both rich and poor households. Clear lessons for households at the micro level: standard of living declines as the number of 0 to 20 in household increases Education Expenditure Per Student (F$) (by quintiles) Number of 5 to 20 year olds in household Q5 Q4 Q3 Q2 Q1 47

48 How convince households of macro impact of their fertility decision? Most times, adults assert their right to have as many children as they wish, with no regard to the national impact on public resources. For instance they will demand that Governments must provide free education up to the university level, as a basic human right regardless of the number of children they produce. But what should should their responsibility be when their household fertility decision imposes un-manageable burdens on the national budget and all tax-payers, including themselves? Let us now look at the massive head-aches faced by some Ministers of Finance and Education in the region, as well as community education groups who try their hardest to educate their children. While some Ministers of Education and Finance are in fortunate positions. 48

49 Extremely clear impact of population growth on resources for education For most PICs, education receives the largest budgetary allocation. Typically, * Education comprises 20% to 25% of Total Government Expenditure * usually around 5% to 7% of GDP * roughly 90% spent on teachers salaries * while teachers have to be first trained, before they are employed Ratio of unit recurrent costs at Primary:Secondary:Tertiary usually around 1 : 2 : 5 With university education around 10 to 20 times the cost of primary education. And the evidence on the impact on education conveys very powerfully and convincingly, the importance of family planning to households: and the shocking implications for Govt budgets. 49

50 For some PICs, must look at current enrolment ratios before examining increasing demographic demand for school places For all Melanesian countries, school attendance is already low at pre-school (age 5) and senior secondary and tertiary levels: i.e. there exists a back-log problem of improving enrolment ratios: because some countries have already failed to cope with their population growth of the last three decades. eg in Vanuatu: rapid drop-off in enrolment ratio after age 12 (2006 HIES) Percentage of Age Group in School Age 50

51 Vanuatu percentages of school age population NOT AT SCHOOL (Source: 2006 HIES) % Not at School Pre-school (5) 90 Primary (6-11) 22 Secondary (11-17) 39 Tertiary (18-20) 81 i.e. Ministry of Education faces huge problem of improving access to pre-school, secondary and tertiary education. Not to mention major problems of lack of consistent quality, especially in scattered rural schools. In addition to problems posed by new cohorts of school age children. Similar existing low enrolment problems faced by PNG and Vanuatu. 51

52 What extra demands for pre-school places? The index numbers give the contrasts: some increasing (PNG, Sol, Van), some declining, and some odd patterns (eg Kiribati) Note paradox that pre-school in most PICs is usually privately funded, hurting the poor while the well-off send their children to pre-school and get a permanent advantage. Index Numbers (5 year olds) 2005 = PNG 120 Solomon Is Vanuatu 110 Marshalls 100 Fiji Tonga 90 Kiribati Samoa Tuvalu 52

53 Extra Early Childhood Education teachers and classrooms (at 1 per 20 infants) required every year? Green is good; brown is pressure Bad news: Future pressure indicated for PNG, Solomons and Vanuatu (+ backlog). Good News: reducing pressures for Samoa, Fiji and Tonga; And no change for Tuvalu and Marshalls: ie economic growth should improve conditions. Backlog Annual Extra pre-school teachers and classrooms Year Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

54 Similar trends: Growth of demand for primary school places Lines rising above Index number 100: indicate increasing demand for places i.e. Solomons, PNG and Vanuatu Less so for Marshalls and Tonga; But reducing pressure for Tuvalu, Samoa, and a bit less for Kiribati and Fiji; Index Numbers (6 to 13 year olds) 2005 = Solomon Is 120 PNG Vanuatu 110 Marshalls Tonga 100 Fiji 90 Kiribati Samoa Tuvalu 54

55 Translating to Extra Primary Teachers and Classes (1 per 40) Unit cost of primary class-rooms? Bad News (brown) Increasing pressure for PNG (whew!), Solomons and Vanuatu: Good News (green): Reducing pressure for Fiji (but reduction getting less), Samoa, Kiribati and Tuvalu. Which should allow these countries to improve access and the quality of schools because of potential savings at the primary level. Extra primary school teachers and classrooms need Year Backlog Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

56 Required capital investment in extra schools? (at 1 per 320) Unit cost of schools? PNG and Solomons requiring not just large numbers annually, but also large back-logs (assuming 20% of primary age children not at school). Fiji, Samoa and Kiribati in the fortunate position of requiring fewer schools: ie possibilities of school rationalisation coming up ahead Extra primary schools required (at 1 for 320) Year Backlog Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

57 Extra Demand for Secondary School Places (14 to 17) For this group, there are unusual demographic patterns because of changes in fertility some 12 to 18 years ago Index Numbers (14 to 17 year olds) 2005 = Fiji Vanuat u 115 Solomon Is 110 PNG Samoa Tonga Kiribati 85 Tuvalu 80 Marshalls

58 Clearly rising pressures for one group Usual countries: Solomons, PNG and Kiribati Marshalls- already enjoyed a dip till 2009, rising demand again before leveling. Index Numbers (14 to 17 year olds) 2005 = Solomon Is PNG Kiribati Marshalls

59 Another group with easing pressures very soon (good news) Are Samoa, Tonga, Fiji and Vanuatu education ministries prepared to take advantage? Possibility of improving student:teacher ratios, and quality of schools perhaps? Index Numbers (14 to 17 year olds) 2005 = Samoa 110 Tonga Fiji Vanuat u Tuvalu 59

60 Translated into secondary teachers and class-rooms (at 1 per 30 students) (not to forget expensive laboratories for science students) But for PNG, Solomons and Vanuatu, not just rapidly increasing demands but also large back-logs. While Fiji, Samoa, Tonga and Tuvalu are headed for breathing space Extra secondary teachers and class-rooms at 1per 30 students Year Backlog Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

61 Extra schools at say 200 students per school? Unit cost of secondary schools? Major increasing capital expenditure indicated ahead for PNG, Solomons, Kiribati. While future rationalisation possible for Fiji, Samoa and Kiribati: Q: should they build any more now? Or just cope by increasing class and school sizes Clear need for longer term projections than to to ensure that schools are not built unnecessarily. Extra secondary schools at 1per 200 students Year Backlog Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

62 What of the extremely expensive tertiary education places (18-21) Interesting that relativities change here: Samoa, Vanuatu, Tuvalu, PNG, then Solomons and Kiribati: increased demands; Note Solomons a late increase, while Kiribati is dipping for three years before rising Index Numbers (18 to 21 year olds) 2005 = Samoa Vanuatu Tuvalu PNG Solomon Is Kiribati

63 While others are more complex patterns Tonga, Fiji and Marshalls have already enjoyed their dip in demand (did they know?) And should now be preparing for increases again, back to the 2005 levels (do they know?) Index Numbers (18 to 21 year olds) 2005 = Tonga 100 Fiji Marshalls

64 The changes in tertiary education places required: huge pressures ahead Keep in mind that in Vanuatu some 80% of those aged 18 to 21 are not at school. Probably similar proportions Not At School in Solomons and PNG. Note the size of the back-logs in Vanuatu, Solomon Islands and PNG (frightening nos.) The pervasiveness of all the brown areas suggest that all PIC have to seriously plan the number of tertiary education places available from 2010 onwards. Changes in tertiary education age persons Year Backlog Fiji Vanuatu Solomon I PNG Samoa Tonga Kiribati Tuvalu Marshalls

65 Impact on labour market: jobs required for school leavers? The numbers are absolutely frightening for some countries: PNG, Fiji, Solomons, Vanuatu and even Samoa. But even more frightening when you compare these numbers to the actual increases in paying jobs that have been created by economic growth in these countries. Labour Market Educated Entrants (Average of 15 to 20 Age Group) Fiji Vanuatu Solomon Is PNG Samoa Tonga Kiribati Tuvalu Marshalls

66 Compare expansion of formal employment with educated school leavers? Formal sector employment is extremely small for most PICs, especially Melanesia. Annual growth rate is extremely small in absolute and relative terms. The annual numbers of school leavers is relatively large. eg Ch. in Formal Emp. Output from Schools Where do they go? Fiji (2%) Solomons (3%) Vanuatu (3.8%) Where do the unabsorbed go? 66

67 Crude model for Fiji, Solomons and Vanuatu Assuming that paid employment grows at the average rate of growth of GDP (i.e. Fiji: 2% pa Solomons: 3% pa Vanuatu: 3.8% pa) Assume 50% of all school leavers absorbed into subsistence/family labour/ft HH work Then cumulative unabsorbed school leavers, as a percentage of Paid Employment: Cumulative Unabsorbed labour Force as % of Paid Employment Fiji Solomons Vanuatu These percentages are additional to the percentages already largely unemployed. Major unemployment disaster in the making for Solomons, Vanuatu and perhaps Fiji as well: with implications for civil unrest, and crime against property, violence against women, children and the elderly, and increases in STIs/HIV. I dare not estimate comparable numbers for PNG: truly frightening. 67

68 Remember: inevitable time lags before Family Planning produces results Suppose that decision makers in PNG, Solomon Is, Vanuatu and Fiji get truly energised as a result of this symposium If national and household family planning measures begin to succeed today, the impacts On numbers of infants, needed health care etc will be visible within 2 years. On Early Childhood enrolments and demands for resources will be seen in 4 to 6 years But On primary school demands will be seen only in 7 to 14 years On secondary school demand will be seen in 15 to 18 years. On tertiary education demand and labour market entrants, will seen in 19 to 22 years. 68

69 Who in our society thinks that far ahead? Do we have political leaders and policy makers who think that far ahead? Or is their priority only on results that become visible before the next election? Is that precisely why some PICs shown so little progress 15 years later, despite so many countries signing and agreeing to the ICPD PoA in 1994? Are we revisiting the same old ground that was visited 15 to 20 years ago? And are the outcomes going to be the same, when we have another such meeting in ? Of course Family Planning at the national level is an incredibly difficult task. But what of the experience of others, with perhaps worse problems than ours? 69

70 China and India: yes we can? 30 years ago, the most populous nation in the world began an incredibly unpopular one child policy. No doubt system had its abuses and weaknesses (especially the killing of female embryos and infants). But the results after three decades: India had for more than 15 years, more children aged 0 to 14 than China. And look at the changes in the numbers of (0 to 14) between 1994 and Imagine the leeway given to the Chinese education system and the tax-payers because of that draconian policy begun thirty years ago; and imagine the pressures on India. 0 to 14 (millions) Ch. 94 to 05 0 to (millions) China India

71 Policy recommendations 1. Urgent need for solid demographic and economic projections and research that bring out all the public resource implications of current patterns of demographic changes, making use of the considerable evidence of good population and development results around the region to reinforce the policy recommendations. 2. Emphasise to policy makers the urgent need to re-establish a national focus on family planning as an essential long term strategy for development, given the significant macro impact at the national level, 3. Emphasise the need for national compaigns that can convince fertility decision makers at the household level on the urgency to reduce fertility, given the positive microeconomic impacts for household welfare. 4. Initiatives to strengthen regional institutional capacity to address population and development issues through research, teaching, and public education campaigns. 71

72 Thank you. Questions and comments 72