1. Leave No One Behind Critical Issues to Fight Extreme Poverty S. M. Zulfiqar Ali Senior Research Fellow, BIDS and Head of Research and Advocacy, EEP/Shiree Presented at BIDS Critical Conversations 2016: The Bangladesh Journey 24 April 2016

2. Poverty Reduction and Social Development: Achievements and Challenges AchievementsChallenges Poverty has gone down from 48.9% in 2000 to 24.8% in 2015 (1.6 percentage point decline per year). Still over 2 crore people live in extreme poverty; many of them live in abject condition; females are more vulnerable than men. Extreme poverty has also gone down from 34.3% in 2000 to 12.9% in 2015 (1.4 percentage point decline per year). About one-fifth of primary school aged (6-10 years) children is out of school; child malnutrition still high. Prevalence of underweight children under five years of age has gone down from 57% in 2000 to 31.9% in 2013. About two-thirds of women get married before the age of 18 years, leading to early and risky pregnancy. Under-five mortality (per 1,000 live births) has also gone down from 84 in 2000 to 41 in 2013. Although access to sanitation has improved, 55.9% people still live in poor conditions with unsafe sanitation facility. Maternal mortality (per 100,000 live births) has also gone down from 318 in 2000 to 197 in 2013. Maternal mortality is still high and has fallen short of MDG target, a large proportion of it is preventable. The poor and the poorest are the worst sufferer of above challenges 2

3. Why Do We Need to Have Special Focus on Extreme Poverty? Three Important Challenges Still Remain: – Considerable presence of extreme poverty (over 2 crore); – New extreme poverty created as a result of a deterioration in the quality of life of both moderate poor and non-poor; – Socially excluded and marginalized groups. Poverty Intensity is also Much Higher for the Extreme Poor: – Some elements - chronicity of deprivations, vulnerability to shocks, and marginality in power relations - are also applicable for the moderate poor, but they are experienced in a more acute form by the extreme poor. We Do Not Want to See the Ugly Face of Poverty Any More: – A good proportion of extreme poor people still live in such a poor condition, which we do not want to see any more. 3

4. Why Do We Need to Have Special Focus on Extreme Poverty (contd.)? Is Middle Income a Solution? – Bangladesh has entered into the league of Lower MICs, however, we shouldn’t sideline the policy emphasis on the eradication of extreme poverty. – There are over 50 countries in this category, which have very different social outcomes, many of them have persistent poverty and social MDG/SDG problems. – Given Bangladesh’s past performance in social development, Bangladesh can be the Lead Country among the Low MICs. – Hence, policy target for the country should be “Being a Middle Income Country with No Extreme Poverty”, i.e., achieving the goal of “LEAVING NO ONE BEHIND”. 4

5. Defining Poverty/Extreme Poverty Money-metric measurement: – National poverty lines (upper and lower) – Global definitions (1.25/1.90 dollar a day) Multi-dimensional aspects: – Income – Food security – Asset holding; – Housing; – Water and sanitation – Employment; – Education; – Health and nutrition; – Household demography; – Empowerment; – Exclusion; etc. The extreme poor, are, therefore, not just income poor, but also the most deprived in respect of a number of indicators. The extreme poor are quite diverse and heterogeneous; socially and geographically scattered. 5

6. Who are the Extreme Poor: Some Correlates Poor asset base (landless, asset less); No homestead, no home/proper housing; Little or no education (lack of education, skill); Physical incapacity (ill-health, disabled, elderly); No or limited employment/income earning opportunities (no or insufficient income); Living in adverse locations (chars, haors, hills); Socially marginalized, alienated and excluded (or at best adversely incorporated); Female-headed/child managed households; Powerlessness/voicelessness/having nobody; and Ethnic minorities. 6

7. Extreme Poverty Agenda in SDGs The first guiding principle of SDGs is: – Leave No One Behind SDG Goal 1 Says: – End Poverty in All Its Forms Everywhere SDG Target 1.1 Says: – Eradicate extreme poverty for all people everywhere by 2030 7

8. Extreme Poverty in the 7 th FYP Special attention has been placed on the extreme poverty agenda in the 7 th five year plan. Separate target for the incidence of extreme poverty has been set – to bring it down to 8.9% by FY 2020. Additional strategies to address extreme poverty has also been identified: – Replication of successful targeted livelihoods programmes; – Measures to prevent and mitigate shocks; – Expanded and inclusive social protection programmes for the extreme poor; – Support for human capital development for the extreme poor. 8

9. Can Bangladesh Eradicate Extreme Poverty within the Shortest Possible Time? Six aspects are noteworthy: – Extreme poverty decreased quite dramatically in both rural and urban areas. – The rate of extreme poverty reduction has been faster in the 2000s compared to the 1990s in both rural and urban areas. – Not only is there a declining trend in extreme poverty, but also the “structure of poverty” has improved, i.e., the proportionate share of extreme poor amongst the total poor at the national level has diminished overtime, especially in the second half of the 2000s. – Human development of Bangladesh’s poorest people has also improved considerably over the past two decades. – Spatially poorest areas have also shown significant progress with significant targeted programmes. – Evidence that the extreme poor can exercise political voice, and this voice can be heard. 9

10. What Do We Need to Do to Eradicate Extreme Poverty? Some further push through replication of micro successes in eradicating extreme poverty – i.e., scaling up targeted livelihood programmes. Substantive and inclusive social protection schemes to Support Extreme Poverty Reduction - Scaling up and targeting the social protection programmes more effectively. Addressing the growing human development needs of the extreme poor - Investing more for human capital development for the extreme poor in order to ensure extreme poor become more resilient; Promoting market development and facilitating extreme poors’ access to the markets for employment and income generation; and Last, but not the least, need to enhance social development of women, the marginalized and excluded groups, and the chronically poor people. If we can do this, Bangladesh can certainly portray itself in a different category of Lower MICs with high human and social development and NO EXTREME POVERTY 10

11. Further Push through Replication of Micro Successes Quite a few programmes (EEP/Shiree, CLP, etc.) have been successful in lifting beneficiary households from extreme poverty. The size of the needed transfer is estimated to be not more than 500 US dollar per beneficiary households spread over about 2 years of programme intervention. The total costs of such replication will not exceed 2-3% of GDP annually - this amount of money, if properly executed, can lift an extremely poor household from severe poverty. HOWEVER, GoB buy-in and increased involvement as well as linking them with other GoB institutions and services (and also with Development Partners) are important to make them more effective and sustainable. 11

12. Substantive and Inclusive Social Protection Schemes The current allocation is in the range of 2.2% of GDP, which in reality is about 0.77% for “core social protection programs”. Currently, the SP programs are too tokenistic (monthly transfer per beneficiary not exceeding 2-3 days of agri labor wage). This needs to change. Renewed emphasis on the social protection along life- cycle approach is very much appreciated, but important that this doesn’t sideline the extreme poverty agenda. There should be a meeting of minds in the dialogue between extreme poverty reduction and social protection strategies. 12

13. Addressing the Growing Human Development Needs of the Extreme Poor There are deprived pockets in human development terms that have been overlooked in the past. As income levels of the extreme poor grow, their demand for human development needs will also increase – especially, in education and health. Equal access to health services and educational opportunities is crucial for inter-generational mobility for the extreme poor. Some of the human development issues require social actions and cannot be addressed by policy alone; making breakthroughs in these areas require longer investments and innovative norms-changing institutional interventions. 13

14. Better-Off GoB Promotes Economic Growth GoB Programme Coordination People Living in Extreme Poverty ERADICATING EXTREME POVERTY: THE NECESSARY AND SUFFICIENT CONDITIONS Targeted Livelihood Programme Access to Finance, Markets & Infrastructure Health and Education Voices and Empowerment Social Protection 14

15. Final Points Given the fact that: – Bangladesh is already in the league of Lower MICs; – Bangladesh would like to eradicate extreme poverty within the shortest possible time; and – The government is also committed to go extra miles in eradicating extreme poverty…. What do we need to do is: – Tie in with 7 th FYP, Vision 2021, SDGs, and the NSSS; – Ensure that the needs of the Extreme Poor are recognized in policies and practices at all levels including national budget; – Ensure existing progressive policies are implemented more effectively and efficiently; and – Monitor implementation and track progress on a regular basis. In order to achieve this, we need a Permanent Secretariat for Extreme Poverty Eradication. 15

16. Thanks 16