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European Approaches to Poverty and Social Exclusion Anne Bakilana World Bank.

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Presentation on theme: "European Approaches to Poverty and Social Exclusion Anne Bakilana World Bank."— Presentation transcript:

1 European Approaches to Poverty and Social Exclusion Anne Bakilana World Bank

2 Social Exclusion and the EUs Social Inclusion Agenda The European Union embraced the social inclusion concept in the mid 1990s as a way of tackling poverty and other social challenges facing its member states. The European Union embraced the social inclusion concept in the mid 1990s as a way of tackling poverty and other social challenges facing its member states. The EU agenda has resulted in common objectives to respond to social exclusion as described in National Action Plans against poverty and social exclusion. The EU agenda has resulted in common objectives to respond to social exclusion as described in National Action Plans against poverty and social exclusion. Other countries and international organizations have also adopted the concepts of social exclusion and inclusion. Other countries and international organizations have also adopted the concepts of social exclusion and inclusion.

3 What is social exclusion? The EUs Definition: a process whereby certain individuals are pushed to the edge of society and prevented from participating fully by virtue of their poverty, or lack of basic competencies and life long learning opportunities, or as a result of discrimination. This distances them from job, income and education and training opportunities, as well as social and community networks and activities. They have little access to power and decision making bodies and thus feel powerless and unable to take control over the decisions that affect their day to day lives (European Commission 2004).

4 UK governments definition of social exclusion social exclusion happens when people or places suffer from a series of problems such as unemployment, discrimination, poor skills, low incomes, poor housing, high crime, ill health and family breakdown. When such problems combine they can create a vicious cycle. Social exclusion can happen as a result of problems that face one person in their life. But it can also start from birth. Being born into poverty or to parents with low skills has a major influence on future life chances.

5 UKs Department for International Development (DFID) s definition a process by which certain groups are systematically disadvantaged because they are discriminated against on the basis of their ethnicity, race, religion, sexual orientation, caste, descent, gender, age, disability, HIV status, migrant status or where they live. Discrimination occurs in public institutions, such as the legal system or education and health services, as well as social institutions like the household. People are excluded by institutions and behavior that reflect, enforce and reproduce prevailing social attitudes and values, particularly those of powerful groups in society.

6 Main features of the various definitions of social exclusion the various concepts of exclusion imply a process, the various concepts of exclusion imply a process, individuals are excluded from what other members of a society are participating in, individuals are excluded from what other members of a society are participating in, there is no clear definition or defined measures of social exclusion, there is no clear definition or defined measures of social exclusion, social exclusion is still a contested term; and despite its wide use in European research, debates and policies, its definition and usage varies significantly from person to person and has continually evolved over time. social exclusion is still a contested term; and despite its wide use in European research, debates and policies, its definition and usage varies significantly from person to person and has continually evolved over time.

7 From Poverty to Poverty and Social Exclusion The social exclusion concept originated in France about 30 years ago; The social exclusion concept originated in France about 30 years ago; The term was mostly used to describe individuals who were not covered by the social security systems of the time (these included single mothers, substance abusers and drug addicts; and people with physical and mental disabilities); The term was mostly used to describe individuals who were not covered by the social security systems of the time (these included single mothers, substance abusers and drug addicts; and people with physical and mental disabilities); Over time this grew to also include the unemployed, the homeless, dissatisfied youth, the old, immigrants, etc. Over time this grew to also include the unemployed, the homeless, dissatisfied youth, the old, immigrants, etc. In the late 1990s, the UKs Labor government put a spotlight on the terms social exclusion and social inclusion. In the late 1990s, the UKs Labor government put a spotlight on the terms social exclusion and social inclusion. UK Govt established a Social Exclusion Unit whose main task is to implement government policies on inclusion and regeneration activities. UK Govt established a Social Exclusion Unit whose main task is to implement government policies on inclusion and regeneration activities.

8 The UK Governments Social Exclusion Unit Initially set up in 1997 first under the Cabinet Unit; and then later moved to the Office of the Deputy Prime Minister in Initially set up in 1997 first under the Cabinet Unit; and then later moved to the Office of the Deputy Prime Minister in There is a Minister for Social Exclusion who is a Minister under the Cabinet Office. There is a Minister for Social Exclusion who is a Minister under the Cabinet Office. Consultations between the Prime Minister, Deputy Prime Minister, various government departments and other stakeholders decide on work program. The Units work includes: Consultations between the Prime Minister, Deputy Prime Minister, various government departments and other stakeholders decide on work program. The Units work includes: i) Policy Reports: Based on consultations with people who have the experience of being excluded; and also includes wide participation beyond government departments including local authorities, business representatives and the NGO sector; ii) Research and Strategy: To understand drivers of social exclusion so that policies can not only tackle the problems but also prevent future exclusion; and iii) Implementing Policy and Supporting Best Practices: promotes best practices from undertaken projects.

9 Why deal with social exclusion? Social exclusion experts argue that: social exclusion is wider than the traditional concept of poverty; social exclusion is wider than the traditional concept of poverty; it is about processes that lead to non- participation in societies activities; it is about processes that lead to non- participation in societies activities; it is multidimensional; it is multidimensional; it embraces concepts of vulnerability to poverty; it embraces concepts of vulnerability to poverty; one does not have to be poor to be socially excluded; one does not have to be poor to be socially excluded; non participation in societies activities is as critical as poverty. non participation in societies activities is as critical as poverty.

10 Who are the socially excluded? Examples from new EU states analyses Those on low incomes; Those on low incomes; The unemployed; The unemployed; Individuals with disability; Individuals with disability; Non citizens; ethnicity minorities; immigrants; Non citizens; ethnicity minorities; immigrants; Families with many children; Families with many children; The homeless and those in poor housing; The homeless and those in poor housing; The young; the old; children; The young; the old; children; Women. Women.

11 Examples of socially excluded groups PolandLithuaniaLatviaEstonia Unemployed Unemployed Low income families; long term unemployed Low income families; long term unemployed Long term unemployed Long term unemployed Lowly paid workers; long term unemployed Lowly paid workers; long term unemployed Disabled Disabled Disabled; Disabled; Disabled; children with disabilities Disabled; children with disabilities Disabled Disabled The Roma; Immigrants and refugees; prisoners The Roma; Immigrants and refugees; prisoners Ethnic minorities; asylum seekers; victims of violence and trafficking; prostitution; ex prisoners; Ethnic minorities; asylum seekers; victims of violence and trafficking; prostitution; ex prisoners; Ethnic minorities; Ethnic minorities; Ex prisoners; Trafficking victims Ex prisoners; Trafficking victims Russian speaking populations Russian speaking populations Families with 3+ children Families with 3+ children Single parents; Families with 3+ children; Orphaned children; children without care; youth and children from excluded families Single parents; Families with 3+ children; Orphaned children; children without care; youth and children from excluded families Low income h/holds with 3+ children; single parent h/holds Low income h/holds with 3+ children; single parent h/holds Single families; families with 3+ children Single families; families with 3+ children Farmers; Rural residents; Homeless Farmers; Rural residents; Homeless The homeless; Farmers and rural populations The homeless; Farmers and rural populations The homeless The homeless The homeless; Lack of private housing. The homeless; Lack of private housing. T he Aged T he Aged Pensioners Pensioners The Old, Children and Youth in care The Old, Children and Youth in care Youth Youth Victims of sexual violence Victims of sexual violence Women who want to return to work after childbearing Women who want to return to work after childbearing Women, the homeless Women, the homeless

12 Manifesto to eradicate poverty and to fight social exclusion in member states by (The European Council of Lisbon, March 2000) A consensus to eradicate poverty and to fight social exclusion in member states by 2010; A consensus to eradicate poverty and to fight social exclusion in member states by 2010; The following policy objectives were adopted: The following policy objectives were adopted: 1) To facilitate participation in employment and access by all to the resources, rights, goods and services; 2) To prevent the risks of exclusion; 3) To help the most vulnerable; 4) To mobilize all relevant bodies.

13 What is Social Inclusion? the process that will enable every person in society to participate in normal activities of societies they live in.

14 National Action Plans for Social Inclusion individual countrys analyses of what groups were socially excluded; individual countrys analyses of what groups were socially excluded; describe specific actions to be taken in order to become more inclusive. describe specific actions to be taken in order to become more inclusive.

15 Counting the Socially Excluded: The Laeken European Council (December 2001) endorsed common statistical indicators of social exclusion and poverty that will serve as key elements in monitoring progress in the fight against poverty and social exclusion (Laeken Indicators) At-risk-of-poverty rate by gender and various age groups At-risk-of-poverty rate by gender and various age groups At-risk-of-poverty rate by most frequent activity and by gender and selected age groups At-risk-of-poverty rate by most frequent activity and by gender and selected age groups At-risk-of-poverty rate by household type At-risk-of-poverty rate by household type At-risk-of-poverty rate by accommodation tenure status and by gender and selected age groups At-risk-of-poverty rate by accommodation tenure status and by gender and selected age groups At-risk-of-poverty rate by work intensity of the household At-risk-of-poverty rate by work intensity of the household At-risk-of-poverty threshold illustrative values At-risk-of-poverty threshold illustrative values Inequality of income distribution s80/s20 income quintile share ratio Inequality of income distribution s80/s20 income quintile share ratio Persistent at-risk-of-poverty rate by gender and selected age groups Persistent at-risk-of-poverty rate by gender and selected age groups Relative median at-risk-of-poverty gap by gender and selected age groups Relative median at-risk-of-poverty gap by gender and selected age groups Regional cohesion by gender (variation in regional employment rates) Regional cohesion by gender (variation in regional employment rates) Long term unemployment rate by gender and selected age groups Long term unemployment rate by gender and selected age groups Persons living in jobless households by gender and selected age groups Persons living in jobless households by gender and selected age groups Early school leavers not in education or training by gender Early school leavers not in education or training by gender Life expectancy at birth by gender Life expectancy at birth by gender Self defined health status by income level by gender and age Self defined health status by income level by gender and age Dispersion around the at-risk-of-poverty threshold by gender and selected age groups Dispersion around the at-risk-of-poverty threshold by gender and selected age groups At-risk-of-poverty rate anchored at one moment in time by gender and selected age groups At-risk-of-poverty rate anchored at one moment in time by gender and selected age groups At-risk-of-poverty rate before cash social transfers by gender and selected age groups At-risk-of-poverty rate before cash social transfers by gender and selected age groups Inequality of income distribution Gini coefficient Inequality of income distribution Gini coefficient Persistent at-risk-of-poverty rate (alternative threshold) by gender and selected age groups Persistent at-risk-of-poverty rate (alternative threshold) by gender and selected age groups Long term unemployment share by gender and age Long term unemployment share by gender and age Very long term unemployment rate by gender and age Very long term unemployment rate by gender and age In-work at risk of poverty rate by gender and age In-work at risk of poverty rate by gender and age

16 From counting the excluded to measuring exclusion: If social exclusion is a process, can we measure it? How can we capture the processes that leads to exclusion? How can we capture the processes that leads to exclusion? Given its multidimensional focus, can this be done in one discipline of study? Given its multidimensional focus, can this be done in one discipline of study? Given the very generous definition of exclusion, what should we focus on? Given the very generous definition of exclusion, what should we focus on? Given the lack of a single definition of exclusion, what should we be analyzing? Given the lack of a single definition of exclusion, what should we be analyzing?

17 The EU Social Inclusion Study: An attempt to measure determinants of social exclusion extending the debate outside discussions about monetary deprivation and poverty extending the debate outside discussions about monetary deprivation and poverty adopted the capability deprivation which says that due to social and economic factors certain individuals in society may never reach their full potential adopted the capability deprivation which says that due to social and economic factors certain individuals in society may never reach their full potential individuals who are deprived of certain capabilities could be excluded from participating in the labor force, consumption, wealth accumulation and from social functions individuals who are deprived of certain capabilities could be excluded from participating in the labor force, consumption, wealth accumulation and from social functions

18 Recognize that jobs and income; education and training opportunities; social, community networks and activities are central to the process of inclusion. Go beyond quantifying the percent of people that lack financial means (or that do not consume enough) as a proportion of the total population. Social exclusion encompasses more than poverty, but, poverty is a component of Social exclusion Profile the proportion of the population that is not included in societys production, consumption, political engagement and social interaction. Excluded from Financial Capital Those who are excluded from access to earnings and wealth Excluded from Human Capital Those with no or very limited Education, skills Excluded from Physical Capital Do not own any Housing or Land Excluded from Social Capital Those with limited friends, family, community interactions and little political empowerment

19 Three Forms of Capital Financial Capital Financial Capital For this exercise, all those with the means to earn financial capital through employment, farms, rental income were grouped as having financial capital. Physical Capital Physical Capital An individual was defined as having physical capital if they privately own land or property. Human Capital Human Capital An individual has human capital from their education and years of schooling and training. For this exercise, those lacking education capital were defined as those who did not reach the compulsory level of education in their country.

20 What data did we have? Year Sample Size Estimated Population Size Estonia Household Budget Survey 20043,1651,340,458 Latvia Household Budget Survey 20043,9132,278,161 Lithuania Household Budget Survey 20047,9693,626,462 Poland Survey of Household Budget , ,784,208 Hungary Household Budget Survey ,5139,985,024

21 What data was used to compile capitals? Lacking in Financial Capital Lacking in Human Capital Lacking in Physical Capital Hungary Living on non-employment and non investment sources of income Have no education or did not achieve compulsory level of education; and are not attending school Do not own the houses they live in; owns no other dwelling; do not own any land Latvia Living on non-employment and non investment sources of income Have no education or did not achieve compulsory level of education; and are not attending school Do not own the houses they live in; owns no other dwelling; do not own any land; Poland Are living on non-work and non investment sources of income Did not achieve the compulsory level of and are not attending school Do not own the houses they live in; and have no second house or summer house; do not own land Estonia Are not earning, rely on benefits as main source of income Are not in education and have not achieved elementary, have elementary or have basic education, have not completed the compulsory level of education Do not own the houses they live in, do not own another house and do not own agricultural land Lithuania Have as their main source of income unemployment benefit, stipend, social assistance benefit, dependents, Have not completed the compulsory level of education and are currently not in school Do not own the houses they live in and dont own another house, do not own land.

22 What did we find? The percent of the population that lacked financial capital was at least 20%, rising to as high as 42% in Poland. The percent of the population that lacked financial capital was at least 20%, rising to as high as 42% in Poland. in Poland where those who had not worked in the last seven days formed 70% of those excluded from financial capital. in Poland where those who had not worked in the last seven days formed 70% of those excluded from financial capital. Youth aged formed the largest proportion of those excluded from financial capital, for e.g. in Hungary 70% of those excluded from financial capital are from this age group. Youth aged formed the largest proportion of those excluded from financial capital, for e.g. in Hungary 70% of those excluded from financial capital are from this age group. In all countries, the larger proportion of those excluded from financial capital were women: 58% in Latvia and Lithuania. In all countries, the larger proportion of those excluded from financial capital were women: 58% in Latvia and Lithuania. Quite large proportions of those excluded from financial capital were those with secondary levels of education. Quite large proportions of those excluded from financial capital were those with secondary levels of education. Urban residents formed the largest proportion of those excluded from financial capital. Urban residents formed the largest proportion of those excluded from financial capital.

23 What did we find? The largest proportion of those that lacked human capital was of individuals in the age groups. The largest proportion of those that lacked human capital was of individuals in the age groups. Without exception, the largest proportion of those that lacked human capital was of individuals in the age groups. Without exception, the largest proportion of those that lacked human capital was of individuals in the age groups. Women formed the largest proportion of those that lacked human capital in Poland, Hungary and Lithuania. Women formed the largest proportion of those that lacked human capital in Poland, Hungary and Lithuania. The majority of those who lacked human capital did have some years of education. The majority of those who lacked human capital did have some years of education. Except for Hungary, the largest proportion of those lacking human capital were rural residents [in Estonia the distribution is close: 49 vs. 51]. Except for Hungary, the largest proportion of those lacking human capital were rural residents [in Estonia the distribution is close: 49 vs. 51]. Unlike what was the case for exclusion from financial capital, a larger proportion of those that lacked human capital were individuals with disabilities, around a quarter of those with no human capital were disabled in Poland Estonia and Hungary and a third in Lithuania. Unlike what was the case for exclusion from financial capital, a larger proportion of those that lacked human capital were individuals with disabilities, around a quarter of those with no human capital were disabled in Poland Estonia and Hungary and a third in Lithuania.

24 Poverty and social exclusion Results show that not all those who are excluded from the various forms of capitals are poor; in fact the majority of those who are excluded from the various forms of capital were not in the bottom consumption quintile. Results show that not all those who are excluded from the various forms of capitals are poor; in fact the majority of those who are excluded from the various forms of capital were not in the bottom consumption quintile.

25 Lessons for methodology and data requirements The data available were all from cross sectional surveys making it impossible to analyze the dynamics of exclusion The data available were all from cross sectional surveys making it impossible to analyze the dynamics of exclusion Since the data come from household surveys, by definition, those who do not live in households are not included Since the data come from household surveys, by definition, those who do not live in households are not included Because of a limited number of variables available in such household budget surveys, it was not possible to quantify ownership of social capital Because of a limited number of variables available in such household budget surveys, it was not possible to quantify ownership of social capital

26 Lessons for methodology and data requirements Analyses focused on the age groups; because available variables were more relevant for working adults and not for children or the elderly (even Eurostat has no indicators for childrens exclusion) Analyses focused on the age groups; because available variables were more relevant for working adults and not for children or the elderly (even Eurostat has no indicators for childrens exclusion) It was not possible to assess the contribution of community and national level capitals that do contribute to individuals possession of the various forms of capitals. Community and national capitals could include social infrastructure such as schools, hospitals, roads, and other forms of collective physical capital. Country data are not directly comparable because variables used to compile the various forms of capitals are not identical across countries.

27 Lessons for methodology and data requirements It is not possible to assess or compare how lack of access to a form of capital is associated with a level of deprivation. That is, is someone who lacks financial capital as worse off as someone who lacks human capital? Does an individual who lacks human and financial capital worse off than the individual that lacks just one of these? Bivariate rather than multivariate analysis for the probability of being both poor and lacking in capitals might not be sufficient to explain the very complex interaction between socio-economic characteristics on one hand and lack of capitals and poverty on the other.


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