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WDR 2004: InterAction Consultation

World Development Report Archives

World Development Report 2004

WB Pre-Spring Meetings
Civil Society Sessions

Meeting on World Development Report 2004 (WDR 04):
Making Services Work for Poor People
Thursday, April 10, 2003
2:00pm – 5:00pm, InterAction, 1717 Mass Ave NW, Washington, DC


This meeting was co-hosted by InterAction and the World Bank to discuss progress on the World Development Report 2004 (WDR 04). The session brought together approximately 25 international civil society participants and staff from the World Bank. Presentations were given by Stephen Commins and Shanta Devarajan, of the World Bank, Shannon Ward, of the American Red Cross, and Gilberto Mendez, of Christian Children’s Fund. The session was chaired by Elena McCollim, of InterAction.

Elena McCollim (InterAction) opened the meeting by welcoming participants. She said that the purpose of the session was to follow-up on the September 2002 WDR consultation and introduced two speakers from the World Bank, Stephen Commins, coordinator of outreach for WDR 04, and Shanta Devarajan, Director of the World Development Report and Chief Economist for the Human Development Network. Presentations would be followed by discussions on the WDR 04 draft and planned next steps. She mentioned that the Bank was planning an e-discussion on the draft that would commence the week of April 15, 2003.

Stephen Commins (WB) began by commenting on the WDR process. He noted that the WDR team had placed a priority on external consultations and have, to date, held consultations in more than 19 countries both face-to-face and by VC, which have provided some of the most productive exchange of ideas on the report. Since September, the outline of the report on the web had received many comments and they will continue to incorporate such comments in the draft. Views on the draft thus far have been diverse; for example, some see the report as too slanted towards the private sector, while others believe it is too focused on the public sector. He emphasized that they are seeking feedback on where the report is not balanced, where there are information or evidence gaps, and where they are not hitting target issues.

In the most recent draft of the report, the WDR team tried to emphasize a number of points: first, that services are a public responsibility, highlighting the importance of equity and rights; second, that additional resources are important to ensure adequate services are provided, but resources are not sufficient without fundamental institutional change; and third, that the missing actors were often citizens or clients. He said that accountability is a core message of the report; the WDR is not about technical fixes or solutions, but on how to make services work for poor people. The WDR team is investing time in producing a report with some traction for creating real change in the quality of service delivery in the future. He encouraged all interested parties to log on and to share their views and ideas by participating in the e-dialogue.

Shanta Devarajan (WB) gave an outline of the main messages of the “green cover” draft of WDR 04 in a power point presentation. The fundamental message of the report is that services are failing poor people in quality, quantity and access. Improving service provision is crucial to achieving the Millennium Development Goals (MDGs). Reducing poverty by 50% is on-track worldwide - notably due to China and India - although off-track in Sub-Saharan Africa. Gender equality, primary education and child mortality targets are off-track. Focusing on economic growth alone will not reach MDGs; there needs to be a focus on the effectiveness of services. There is little systematic relationship between health and education in relation to public spending. Therefore, spending is not enough; changing institutional relations for service provision is the main problem addressed in the WDR.

Why is this the case? Taking health and education spending in various countries as an example, he said a higher percentage of public spending tends to go to the richest rather than poorest quintiles. In Guinea, 48% of health spending goes to the richest and only 8% to the poorest quintile. The same is true of primary education spending in Guinea, despite the fact that this spending is usually more ‘pro-poor’ in other countries as the wealthy opt out of the public sector and send children to private schools. Shifting resources to primary health and education does not solve this dilemma and gives rise to other problems. Firstly, access to drinking water is critical to reducing infant mortality, but access is better for the richest than for the poorest quintiles. Secondly, when spending is reallocated, only a small proportion may reach the front lines where it is most needed, unless there are systematic reforms. Even if that problem is solved, the third difficulty is the reported low quality of public services in many instances.

The policy maker has to ensure that the service provider delivers, meaning the line of accountability is indirect. This chain breaks down at both ends for the poor. When it comes to subsidized services, politicians sometimes use the citizen-policy maker link to gain votes rather than reduce poverty. He cited Mexico’s poverty relief program, PRONASOL, as an example. From 1989-94, 1.2% of GDP went towards the program, but it only reduced poverty by 3%; if it had been effectively implemented, the program could have relieved poverty by over 60%. The party in power, promised higher PRONASOL expenditures per capita in return for votes. This pattern has also been observed in non-democracies. He affirmed that other countries, democratic or otherwise, had successfully achieved health and education provision. Nevertheless, the political framework did not necessarily guarantee service provision.

Even if policy makers do care about poor, e.g. Cuba or China, they still have to ensure that the service provider delivers. There are services for which outputs are clearly specified, such as immunization, meaning the contract between the government and service provider can be easily monitored. Conversely, curative care and learning are not easily monitored by the policy maker. Cambodia has had some success in this regard: the government implemented a three pronged process whereby some services were “contracted out” (to local NGOs who were responsible for hiring, firing and service provision); some were “contracted in” (to NGOs who ran services without the capacity to hire and fire); and some which were government-controlled. The most successful group was “contracted out”. This demonstrates the need for strengthening the ‘short route’, by making service providers more accountable to their clients (citizens). Another example of a successful program is in Bangladesh, where the government used a demand-side subsidy to boost education rates amongst girls. The subsidy, to pay for the girl’s education, was deposited directly into a bank account in the student’s name, on the condition she stayed in school, passed her exams and remained unmarried. Schools were reimbursed based on number of girls they enrolled. The program proved very successful, not only raising the number of girls in school, but also in increasing the number of all-girls’ schools.

It was emphasized that the WDR 04 is not pro-privatization; there is no doubt that health and education outcomes are a public responsibility. Services cannot be left solely to the private sector, nor is the answer simply to increase public spending. The question is how the public sector can meet its responsibilities where it is currently failing. Institutions and accountability mechanisms are crucial, including citizen/client access to information and tailoring service provision to fit different characteristics and countries. Mechanisms need to be put in place to systematically document and learn from various processes. Services need to be considered in terms of three categories of characteristics: How easy or difficult they are to monitor; whether the client base is heterogeneous or homogeneous, and whether service provision is responding to different demands and needs; and whether policies are pro-rich or pro-poor in terms of service provision, regardless of whether countries democracies or non democracies. Applying these characteristics in a decision framework, you come up with not “one size fits all” for all service delivery, but perhaps “8 sizes fits all”.

In a relatively homogeneous, pro-poor country like Sweden, easy to monitor services, such as immunization, were contracted out whereas difficult-to-monitor services like education were provided by the central government. Due to increased immigration, Sweden has moved from a homogeneous to heterogeneous population, and thus have had to change their methods of service delivery; a uniform curriculum is no longer suitable, and responsibility for curriculum has been devolved to the municipalities.

Looking at a scenario of services that are difficult to monitor, in a heterogeneous country with pro-rich policies, traditional central government provision and financing usually breaks down and the client has to be put back in the driver’s seat through demand side subsidies, e.g. PROGRESSA in Mexico, by giving communities the power to hire and fire service providers. This changes the role of user fees for water services, where in some countries (e.g. India) the poor are in essence subsidizing water provision for the rich. By introducing or raising some fees e.g. on electricity and water for those who can afford to pay, you may reduce the rent-seeking and help promote greater access for those who are truly poor.

Question: What is the legitimate right of the World Bank to push everyone to go by their conclusions? They are giving loans that have to be repaid by governments, meaning the whole debate is geared in a particular direction. The debate should focus on how services are provided to people, but the influence of donors should be limited as far as deciding what policies are applied in the country itself.

Question: Is the World Bank coming up with this process due to the failure of cost recovery plans? In addition, the WDR uses the terms of “clients” and “competitive markets” while denying that this is about privatization. More clarification is required here.

Question: In the Bangladesh example, could you clarify how you get effective accountability through choice? People may in theory have a choice of schools, but how much choice do they actually have?
Question: Are the indicators used to measure gender equality in education the ratio of enrollment rates or the difference in figures between enrolled boys and girls? World Bank evaluations and HDR evaluations differ for reaching the primary, second and tertiary education targets by 2005.

Question: When talking of increasing access to information, is this applicable equally to democratic and non-democratic countries? In addition, the recommendation that donor assistance should flow into recipient countries’ budget systems is not really the issue. The issue is that donor assistance should be used to strengthen the client-government relationship, and in some countries that may be in the interim stage.

Shanta Devarajan (WB): Budget support may have the effect of weakening good budgeting in a country, if lending is subject to donors’ own financial management procedures. e.g. Benin has multiple donors and the government spends the majority of its time trying to meet donor demands.

With regard to information dissemination in non-democratic societies, there are cases where service provision fails and politicians do nothing to rectify the situation, but NGOs can be instrumental in publicizing this.

Regarding gender equality indicators, the ratio of girls to boys is used as the indicator for the MDG on gender equality, but this has to be linked to enrollment levels to prevent a distortion of the figures, for example, when boys are just being taken out of school, as has occurred in some countries in Africa.

In the Bangladesh example, girls did have a choice of what schools to attend and their choices increased as many new schools were established by NGOs.

Finally, the term “clients” is used inter-changeably with “citizens” in the report, in recognition that people are both. With regard to cost recovery plans, there are places where cost recovery schemes have failed, but our research shows that service provision is failing both where the Bank is both involved and not involved. There is a generic problem of services failing, not simply due to the failure of cost recovery plans.

Question: In your accountability analysis of the client, service provider and government, there are difficulties connecting this triangle without skewing services to the poor. Has there been a comparable analysis of this triangular relationship for the private sector and for non-profit providers?

Question: The presentation talked of a holistic approach and community involvement in terms of monitoring and evaluation. This puts a burden on the community. In their organization’s work in Kenya, for example, people were shocked and confused when asked what services they needed. Therefore, what sort of capacity building does the model in the WDR 04 include?

Question: The analytical framework in the WDR is great. But in terms of accountability, are you not putting too much on this as the standard and incentive to judge and garner good services?

Question: What is the connection between the level of accessibility and quality of service delivery to the level of countries’ debt repayments? Countries who are unable to fund services are meanwhile repaying loans to World Bank.

Shanta Devarajan (WB): Regarding the triangle of responsibility for non-profit or private providers: When there is a problem monitoring the service provider, it is sometimes possible to use the intrinsic motivation of the provider to ensure service delivery. This is evident with faith-based and non-profit NGOs and can be used as a mechanism for service delivery. For example, faith-based health providers in Uganda provide services at pay scales that are 28% less than the private or public sector. This can solve monitoring problems, but with limits.

In response to the question about putting too much emphasis on accountability, he defended the WDR team’s belief that accountability is crucial to improving service delivery. It is not just about a lack of resources, or that technical solutions do not exist.
Regarding the capacity of communities to monitor, this is a critical issue. Poor communities have enough to cope with without having to monitor service providers. Nevertheless, capacity has a lot to do with incentives, as experience has shown communities may get together spontaneously to monitor their services. For example, the institution of a road tax in Zambia encouraged local communities to monitor bridges to prevent overloaded trucks from crossing, as they were made accountable for keeping the bridges in good order.

Regarding the question on accessibility and service delivery and a country’s foreign debt, Africa has high foreign debt and a poor track record of education and health services. By contrast, India has no debt, but appalling services. Some countries have high debt, but with better service delivery. Therefore, it is not all about debt.

Question: My understanding is that the previous e-consultation was not substantially incorporated in the green draft. In next round of e-consultations, will civil society comments be incorporated into the final draft?

Question: The WDR model discussed the relationship between the client and provider. If the argument made is applied, the client has the direct responsibility of deciding whether a service comes from a particular provider or not; this was mentioned as one advantage of private sector service provision. In context of Sri Lanka, people think of the World Bank as the provider (as well as the G8 countries who provide funds to the Bank to provide that loan). The PRSP for Sri Lanka states that 25 years of trying to achieve faster growth through trickle down economics has not reduced poverty. Despite these failures, the same provider, the Bank, is giving the same prescription – to bypass growth and relieve poverty through trickle down. Over 25 years this has cost Sri Lanka a lot: infrastructure built by international companies who do not pay taxes; and trade policies that did not work, i.e. exports did not generate growth. The question is whether using this kind of process takes choices away from countries as they become more dependent on loans?

Question: I sense that the General Agreement on Trade and Services (GATS) does not get a mention in the WDR. How do you see binding commitments for GATS, and allowing governments to change and learn over time? Governments may want to encourage community participation, but GATS may rub against this, as its rules don’t allow it. How do you think the issues of development of services covers GATS?

Stephen Commins (WB): Regarding the e-consultations, there has not been any e:dialogue on the WDR yet, but people posted comments on the WDR outline after the September consultation. A number of changes have been made to the draft: for example, ‘client’ has been changed to ‘citizen’, and ‘policy maker’ to ‘politician’ to recognize the inherent power relationship. We have included terms on the rights of human citizens, for example, rights-based development and rights-based languages (they consulted the High Commission on Human Rights on this). The report is highly critical of the failure of public sector, but the report makes clear there is a responsibility that the public sector has to carry out.

In relation to GATS, there is a box in the draft that has been disseminated to civil society groups in Geneva working on this issue. Reserving the right of governments to regulate services in each state has been recognized as an important point; although the current language in the GATS is too ambiguous about protecting government rights to regulate services. There is a World Development Movement paper on this topic, which they have read and have sent to the author of the WDR section on GATS.

On the question of accountability, the second half of the e-dialogue will focus on what can be done to strengthen mechanisms for accountability. The WDR team is developing a CD-Rom with all the background papers and criticisms provided of the WDR, and proposed mechanisms to make accountability work.

Shanta Devarajan (WB): Sri Lanka has been going through civil war during the last 25 years, which greatly accounts for its lack of growth; the World Bank cannot take responsibility for the civil war.

Current World Bank policies are moving towards the greater participation of civil society, in terms of the direct involvement of NGOs as service providers.

There is a multi-sectoral element to human development: if you want to achieve a two-thirds reduction in infant mortality, water and sanitation has to be addressed, i.e. there needs to be better coordination between sectors. They advocate a programmatic approach in order to achieve the MDGs, where the World Bank helps governments develop programs they can take ownership of, rather than the Bank implementing projects here and there.

Question: What changes will the draft undergo and when?

Stephen Commins (WB): Many comments on the draft have already been received from different parties. This draft will be revised into the “gray cover” version that will be discussed by the Bank’s Executive Directors in May – it is important to note that this is for discussion only; there is no censorship of the report by the Board. After this, there are three more weeks before the final version goes to print, as it will be formally launched at the next Annual Meetings in September. There will be a a number of events in developing and developed countries in September and October on the WDR’s implications.. So, we have invested a lot of time in consultations, and now we are moving toward creating a CD-Rom with all the relevant materials. This is very different approach to before, as previously, the WDR stood alone. The team plans to keep revisiting this draft: the triangle model will be revised, among other things. The revisions are a huge process; chapter authors may get 50 comments from academia and civil society, besides internal comments from staff.

Shannon Ward, American Red Cross presented a successful Community Action Planning (CAP) program implemented by the Red Cross (RC) in Bulgaria focusing on the services to the elderly. In research conducted by the organization in 2002, food and medical assistance were most widely requested as needs. They looked at food consumption, expenditure patterns, and the purchasing power of elderly, using a living standards measurement devised by the World Bank. Most information was self-reported by those surveyed.

From the setup of CAP to its implementation, all activities were done in partnership with other RC branches. They first set up a steering committee with RC members, established guidelines, and provided technical assistance to regions. They then provided training to RC branches on planning, public information campaigns and service delivery models. The crux of the plan involved the organization of community forums, which brought together 50-70 people from local communities (NGO leaders, pensioner groups, and municipal governments etc). Working groups focused on food and health requirements based on the self-reported needs from earlier research. They discussed research results and mapped community resources, i.e. mapping who was providing what for the needs of the community. Nominated working group were then responsible for putting together funding proposals; training was provided to the groups on project design and resource mobilization to ensure the proposed projects were sustainable. As the proposals developed, working groups representing interests of the community forum were able to refer to the steering committee for additional support. All proposals were subject to a double review process, after which project agreements were signed and implemented.

Some interventions that were proposed, e.g. the provision of food parcels, were not sustainable and they had to look at other solutions. The projects approved included the provision of subsidized food to the elderly, improving awareness of social programs the elderly were eligible for and education on health issues. The program is in its early stages and proposals have not been implemented thus far. Two regions have signed off, but impact assessments and evaluations are not yet possible.

They have learnt a number of lessons in the process: the need for tighter timelines; ensuring technical assistance is able to meet demands (some regions needed much more significant assistance than others); improving processes and procedures; and strictly defining parameters.

The program has been successful in urging communities to find new ways to work together, facilitating stakeholder outreach and building up capacity in the regions. In addition, a process has been designed that could be applied to other donor situations. Overall, they have had good feedback from communities involved.

Question: Was there negotiation during design process?

Shannon Ward: the process was very flexible in its design and there was negotiation. But, projects had to target the elderly and be sustainable.

Question: How involved were the community in developing the community resource plan?

Shannon Ward: People would register themselves to work on a particular sector; the community forum working groups were formed on the basis of this, with help from the steering committee.

Gilberto Mendez, Christian Children’s Fund presented a positive experience of an Early Childhood Development (ECD) program in Honduras. They are supporting ECD programs in 27 countries, but the program is most mature in Honduras, where 66% of households are below the poverty line and 35% of children do not attend school.

Worldwide, the number of children surviving infancy has increased, but 39% of those who do survive have developmental delays. In Africa, child nutrition is having serious setbacks. With more women in the labor force, children are being further neglected. Major problems are child nutrition and learning - school enrollment is lagging. Children are most vulnerable to the effects of poverty hence the stronger demand for ECD programs in many countries as families and other actors, like governments, are more aware of opportunities to make change.

To succeed, programs have to be locally owned with large coverage and, above all, be sustainable. Their aim is to promote social capital contributions by identifying key stakeholders; in the case of children, these are parents - in particular mothers. Community capacity building and service provision go hand-in-hand, therefore they are working with community groups to build capacity and deliver needs. Program expansion is possible through government contracts with NGOs and informal education bodies.

The home-based ECD program (for 0-3 year olds) trains ‘Guide Mothers’ (GMs) to serve as role models and lead child-centered development efforts. GMs are supported and coached by supervisors to promote good health practices.

The center-based ECD program (for 4-6 year olds) trains ‘Gardeners’ to try to build a child-friendly environment and school readiness amongst children. Gardeners work in partnership with parents and community groups on health and nutrition issues, on developing social and emotional competencies, and cognitive and learning skills. In the case of this program, this has proved to be a powerful relationship.

They have found communities to be very focused on programs that support children with immediate health and nutritional needs. Programs have to be holistic; guide mothers know what the problems are, and they manage and monitor the programs. The curriculum is well defined in scope and sequence; it has five ‘development domains’ to assess the level of child developmental delays. This information is used to evaluate children on a growth development scale, which CCF has adapted from around 20 others. The information is transparent to ensure the program is accountable to the government, the NGO community and international donors.

The Honduras program is covering 23,000 children, with 1747 Guide Mothers, 155 Gardeners, and 55 well-established programs functioning with their own organizational structures. These organizations manage their own funds and have own ‘guide’ rules and regulations.

Communities in Honduras have experienced positive outcomes. These include: improved health practices and control of common childhood illnesses; a reduction in malnutrition; greater school readiness of children; an integrated response of the community to child issues; and greater self-esteem and confidence among mothers.

Elena McCollim (InterAction) wrapped up the meeting by noting that there had been substantial changes in the WDR approach since the discussions in September 2002, which demonstrated that the team had a greater awareness of certain issues. For example, the role of the public sector in ensuring ends are met. She also noted the importance of addressing the GATS issue. Elena then closed the meeting by thanking all speakers and participants.

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