Social Policy and Economic Development in the Nordic Countries

Transcription

1 Social Policy and Economic Development in the Nordic Countries Add a map of Finland here Some thoughts inspired by the paper by Palme and Kangas, by: Timo.Voipio@formin.fi, Buenos Aires Feb,,

2 Nordic Global: Poverty Reduction vs. Social and Environmental Policy INDUSTRIALIZATION Prosperity for all? Inequality & other social problems Environmental probl. GLOBALIZATION Prosperity for all? Global social problems Global environmental problems 19 th -20 th Centuries: Universal Social Policy! Environmental Policy! 21 st Century: Halonen/Mkapa Comm n: Univ. Global SocPol! Brundtland Commission Global Environmental Policy! 2

3 WHAT SHOULD FINLAND SHARE WITH PARTNERS IN THE GLOBAL SOUTH? improving_effectiveness.pdf 3

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5 Finland a Survival Society -1 A nation that has experienced a rapid transformation from starvation, poverty, civil war,, depression, II world war into one of the world s most competitive information societies and economies based on pro-poor poor growth through investments in people & equity as an outcome of social contracts established through permament structures of multi-stakeholder dialogue 5

6 Finland a Survival Society -2 A cold, dark and remote country Few natural endowments (forests) A history as a colony (of Sweden and Russia) A sensitive relationship with a giant neighbour (Soviet Union/Russia Russia) A Swedish-speaking speaking (former) elite and a Finnish- speaking (formerly) disadvantaged majority A homogenous protestant basis high literacy 6

7 All was not always well: 1) Finland was a colony - of Sweden of Russia

8 2) Famine Add a map of Finland here 8

9 General Strike 1905 universal suffrage

10 3) Civil war

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13 Civil War Prison Camps 13

14 killed in total 14

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16 Since then: Finland catching up others 16

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18 Add a map of Finland here Land reform 1920s 18

19 Universal public primary schooling 19

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21 All families interested in paying tax and to maintain quality of public services 21

22 Long-term investments into human capital, even in the most remote parts of the country 22

23 Common destiny: 2ndWW Add a map of Finland here 23

24 Post-war obligation to succeed Add a map of Finland here 24

25 Keep all parts of the country inhabited leave no vacuum (EAST!) participatory democracy in > 400 local councils (~12.000/LC) 25

26 Add a map of Finland here 26

27 : 48: 2nd Land Reform: Resettlement of Refugees from the lost territories 27

28 Residence-based social security To be eligible for social security benefits, you must be living in Finland. Benefits are individual, e.g. women have rights not only through the husbands jobs National Pension Insurance Act Child Disability Allowances Act Disability Allowances Act Family Allowances Act Maternity Grants Act Survivors' Benefit Act Housing Allowance for Pensioners Act Housing Allowances Act Act on Front-Veterans' Pensions Act on Special Assistance for Immigrants 28

29 Social risk management through social policy and institutional reform Old age ( ) Housing ( ) Immigr. Long term un- Work and family (65-95) employment Ill health ( ) Children ( ) Studies (60-85) Unemployment (60-85) Over indebt- edness (1990s) 1920s s. 1990s. 2000s (Sources: Jäntti, Saari, Vartiainen 2005; Saari 2005). 29

30 Tri-partite negotiations 30

31 Need for Risk Management and for a socio-economic floor? Income profile B Higher levels - privately-provided provided? Socio-economic floor ensured by gov t/oda? Income profile A Minimum insurance needs 31

32 DAC: Social Protection = poverty reduction ECONOMIC consumption income assets SECURITY risk, vulnerability social protection/ social risk management (SRM) GENDER + ENVIRON- MENT POLITICAL rights freedoms voice & influence HUMAN health education hunger, thirst SOCIO- CULTURAL status respect, dignity

33 Diverse concepts used by various donors: A Basic social security: Food, health, housing, education, skill dev t, labour mkt security for noncritically vulnerable B Promotion: Policies to support the particularly vulnerable (disabled, elderly, working children, PLWA) C Safety nets: focus on stopping people falling, post-risk event, often risk prevention and livelihood promotion can be built in D Social insurance: Policies to help households insure against risk E Macro Policies etc. policies not designed to manage risks, but may do so, e.g. SME,productivity, industrial, environmental. Social Risk Management (WB): public and private actions to minimize, mitigate and cope with risk Social Protection = B+C+D (~ Contingent SS?) Basic Social Security=A ; Extended SS =A+B+C+D; Social assistance = B+C ; Social Insurance =D ; Safety Nets = C Social Risk Management (WB) = B+C+D+E; Nordic SRM A+B+C+D+E (springboard); 33

34 Mkandawire & Palme: Social Justice Through Targeting or Universalism? A relevant and difficult - choice for poor country governments and donors in PRS-processes More difficult to take side than in most other ideological dichotomies e.g.: SOCIAL vs. ECONOMISTIC perspective EMPOWERMENT vs. GROWTH STATE vs. MARKET 34

35 Finnish ~ Nordic ~ ILO ~ UNRISD thinking: Rights-based approach universal right to basic security & services Solidarity, middle-class buy-in, crosssubsidization ( Services targeted to the poor only tend to be poor services. ) BUT: How to maximize social justice with small budgets, leakage, under-utilization, corruption, etc??? Some of the most pro-poor partners use targeting, e.g. GTZ in Kalumo, Zambia and Vietnam National Targeted programmes 35

36 E.g. Pilot Social Cash Transfer Scheme: Kalomo District, Zambia -1 GTZ-pilot, now reaches 143 villages Village committee chooses the poorest 10% Transfer = $6 a month = cost of a 50kg of maize = sufficient for a family to add an extra meal per day per person Few inclusion errors only the very poor and incapacitated were included Large exclusion errors but due to the fact that many more households were eligible than the budget would support 36

37 E.g. Pilot Social Cash Transfer Scheme: Kalomo District, Zambia - 2 Distribution is reliable and timely if close to a pay point, but not so if >15km away The transfer is used to buy basic necessities Schools report improved attendance of children from beneficiary households Cash is more appreciated than in kind transfers Some of the cash is saved and invested Beggars turned into productive investors no humiliation/stigma AfDB and DFID plan to expand to cover the whole of Zambia. 37

38 Extension-dilemma Comprehensive service (e.g. social security) first for few, and then extension to all? OR: Narrow service (e.g. sickness insurance) first to all, and then extension to other social risks? Smart subsidies smart for whom? e.g. Low-pay public works? e.g. Conditional Cash Transfers? (educ, child health, nutrition supplements?) 38

39 Justifications used by donors for focusing on social protection Pro-poor growth helps avoid shocks that can derail growth promotes innovation, risk taking and entrepreneurship broadens participation in economic growth focuses on asset accumulation counteracts irreversible asset depletion Rights-based MDGs, basic needs human development / human security (Sen/JICA) global socio-economic floor (minimum standards) & global compact (MDG8) democratic participation and social dialogue sustainable development, lifecycle and intergenerational thinking 39

40 Redistribution of what? Redistribution of the fruits of growth or of growth incidence A narrow tradeable / export sector/area? (and redistribution, if any?) Growth in all sectors/areas where the poor are & growth also in the national economy? 40

41 Who should be the agents of growth? Where? How? 41

42 Resistance to social policies: Fear for the growing arrows of redistribution A narrow tradeable / export sector/area? (and redistribution, if any?) Growth in all sectors/areas where the poor are & growth also in the national economy? 42

43 Resistance to social policies: Fear for the growing arrows or redistribution A narrow tradeable / export sector/area? (and redistribution, if any?) Growth in all sectors/areas where the poor are & growth also in the national economy? 43

44 In reality: Redistributive institutions are often very weak in poor countries: A narrow tradeable / export sector/area? (and redistribution, if any?) Growth in all sectors/areas where the poor are & growth also in the national economy? 44

45 Targeted benefits often by-pass the poor and LEAK back to the non-poor A narrow tradeable / export sector/area? (and redistribution, if any?) Growth in all sectors/areas where the poor are & growth also in the national economy? 45

46 Therefore preferably: GDP-growth as a result of millions of poor families and firms growing their own economies? 46

47 Strong supporting arguments from World Bank s WDR-2006 on EQUITY and growth To prosper, a society must create incentives for the vast majority of the population to invest and innovate. 47

48 Nordic Global: Poverty Reduction vs. Social and Environmental Policy INDUSTRIALIZATION Prosperity for all? Inequality & other social problems Environmental probl. GLOBALIZATION Prosperity for all? Global social problems Global environmental problems 19 th -20 th Centuries: Universal Social Policy! Environmental Policy! 21 st Century: Halonen/Mkapa Comm n: Univ. Global SocPol! Brundtland Commission Global Environmental Policy! 48

49 Multi-stakeholder dialogue needed also in democratic global governance, e.g.: E.g. - Listening to the Marginalized Voices - Making the Marginalised Matter at the Bamako Polycentric World Social Forum ==> See: 49