world development report 2004

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world development report 2004
Making Services Work for Poor People
Flagship Course on Governance
Anticorruption Washington DC, December 2, 2003
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Messages

• Services are failing poor people.
• But they can work. How?
• By empowering poor people to
• Monitor and discipline service providers
• Raise their voice in policymaking
• By strengthening incentives for service providers
  to serve the poor

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Why focus on human development outcomes?
Millennium Development Goals global aggregates
Eradicate poverty and hunger
Universal primary education
Source www.developmentgoals.org
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Millennium Development Goals global aggregates
Promote gender equality
Reduce child mortality
Source www.developmentgoals.org
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Outcomes are worse for poor peopleInfant and
child deaths per 1000 live births
Source Analysis of Demographic and Health Survey
data
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Outcomes are worse for poor peoplePercent aged
15 to 19 completing each grade or higher
Source Analysis of Demographic and Health Survey
data
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Growth is not enough
Percent living on 1/day Percent living on 1/day Primary completion rate (percent) Primary completion rate (percent) Under-5 mortality rate Under-5 mortality rate
Target 2015 growth alone Target 2015 growth alone Target 2015 growth alone
East Asia 14 4 100 100 19 26
Europe and Central Asia 1 1 100 100 15 26
Latin America 8 8 100 95 17 30
Middle East and North Africa 1 1 100 96 25 41
South Asia 22 15 100 99 43 69
Africa 24 35 100 56 59 151
Sources World Bank 2003a, Devarajan 2002.
Notes Average annual growth rates of GDP per
capita assumed are EAP 5.4 ECA 3.6 LAC 1.8
MENA 1.4 SA 3.8 AFR 1.2. Elasticity assumed
between growth and poverty is 1.5 primary
completion is 0.62 under-5 mortality is 0.48.
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Increasing public spending is not enough
Percent deviation from rate predicted by GDP
per capita Source Spending and GDP from World
Development Indicators database. Under-5
mortality from Unicef 2002
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Increasing public spending is not enough
Percent deviation from rate predicted by GDP
per capita Source Spending and GDP from World
Development Indicators database. School
completion from Bruns, Mingat and Rakatomalala
2003
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Similar changes in public spending can be
associated with vastly different changes in
outcomes
Sources Spending data from World Development
Indicators database. School completion from
Bruns, Mingat and Rakatomalala 2003
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and vastly different changes in spending can be
associated with similar changes in outcomes.
Sources Spending data for 1990s from World
Development Indicators database. Child mortality
data from Unicef 2002. Other data from World
Bank staff
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How are services failing poor people?

• Public spending usually benefits the rich, not
  the poor

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Expenditure incidence
Health
Education
Source Filmer 2003b
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How are services failing poor people?

• Public spending benefits the rich more than the
  poor
• Money fails to reach frontline service providers
• In Uganda, only 13 percent of non-wage recurrent
  spending on primary education reached primary
  schools

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How are services failing poor people?

• Public spending benefits the rich more than the
  poor
• Money fails to reach frontline service providers
• Service quality is low for poor people

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Examples of low service quality

• India Absenteeism rates for teachers in
  government primary schools 50 percent
• Bangladesh Absenteeism rates for doctors in
  primary health care centers 74 percent
• Zimbabwe nurses hit mothers during delivery
• Guinea 70 percent government drugs disappeared
• India Delhi Chennai get 4 to 6 hours of water
  per day, Hyderabad gets 1.5 hours every other day

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But services can work

• Infant mortality and malnutrition reduced in
  Ceará, Brazil
• Citywide services in Johannesburg, South Africa
  reformed
• Municipal services improved in Bangalore, India
• Rural electricity cooperatives increased access
  to power in Bangladesh
• More money reached primary schools in Uganda

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What contributes to an effective classroom or
health clinic?

• For a service transaction to be successful, we
  need a frontline provider who
• is capable
• has access to adequate resources inputs
• is motivated to pursue goals that can be
  monitored

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So, spend more money to hire and train more
teachers?

• But governments spend a lot on teachers salaries
• 16 out of 18 sub-Saharan African countries spent
  more than the recommended 66 of recurrent
  education spending on teacher salaries, some more
  than 90
• Its obvious this crowds out other inputs, yet
  governments keep spending on salary budgets
• So problem is not these proximate determinants,
  but with institutional context that generates and
  sustains these decisions

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One way of looking at the problem of a motivated
provider

• Reducing teacher absenteeism from, say, 12 to 7
  is a matter of money and technical solutions such
  as training its a managerial problem
• Reducing absenteeism 70 to 7 is not a matter of
  money and technical solutions, its an
  institutional problem

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What, then, is the right question to ask?

• What institutional conditions support the
  emergence of good frontline providers and
  services that work for poor people?
• The answer Services work for poor people when
  they involve institutional relationships in which
  key players in service delivery are accountable
  to each other

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Accountability seems key to service delivery

• If accountability is strong or can be
  strengthened, services may be improved by
  spending more on
• building more schools and clinics
• training more teachers and health workers
• designing better curricula drug procurement
  schemes
• building bigger infrastructure networks
• But if accountability remains weak, addressing
  the proximate determinants of success will not
  work

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A framework of relationships of accountability
Poor people
Providers
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A framework of relationships of accountability
Policymakers
Poor people
Providers
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The relationship of accountabilityhas five
features
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A framework of relationships of accountability
Policymakers
Voice
Poor people
Providers
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Mexicos PRONASOL, 1989-94

• Large social assistance program (1.2 percent of
  GDP)
• Water, sanitation, electricity and education
  construction to poor communities
• Limited poverty impact
• Reduced poverty by 3 percent
• Even an untargeted, uniform per capita transfer
  would have reduced poverty by 13 percent

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PRONASOL expenditures according to party in
municipal government
Source Estevez, Magaloni and Diaz-Cayeros 2002
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A framework of relationships of accountability
Policymakers
Compact
Providers
Poor people
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Policymaker-providerContracting NGOs in Cambodia

• Contracted out NGO managed could hire, fire,
  transfer staff, set wages, procure drugs
• Contracted in NGO managed and could transfer
  but not hire and fire staff
• Control group Services run by government
• 12 districts randomly assigned to each category

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Contracting for Outcomes health services in
Cambodia
Use of facilities by poor people ill in previous
month
Source Bhushan, Keller and Schwartz 2002
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A framework of relationships of accountability
Policymakers
Poor people
Providers
Client power
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Keeping girls in secondary school in Bangladesh
choice

• Girls to receive scholarship deposited to bank
  account set up in their name if
• Attend school regularly
• Maintain passing grade
• Stay unmarried
• Schools receive grants based on number of girls
  enrolled

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EDUCO program in El Salvador participation

• Parents associations contract with Education
  Ministry to deliver primary education
• Associations have authority to
• visit schools on regular basis
• hire and fire teachers

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EDUCO promoted parental involvement
which boosts student performance
Source Adapted from Jimenez and Sawada 1999
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Accountability and decentralized service delivery
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Degrees of decentralization
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What not to do

• Leave it to the private sector
• Simply increase public spending
• Apply technocratic solutions

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What is to be done?

• Expand information
• Tailor service delivery arrangements to service
  characteristics and country circumstances

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Eight sizes fit all?
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Eight sizes fit all?
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Eight sizes fit all?
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Eight sizes fit all?
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Eight sizes fit all?
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Eight sizes fit all?
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Eight sizes fit all?
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Politics matters for service delivery

• Lack of information among voters about politician
  performance
• Social, cultural, ideological polarization that
  leads to identity-based voting
• Lack of credibility of political promises
• Politics dominated by clientelism, political
  patrons providing private goods to clients

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Some puzzles on politics

• Why do politicians who depend on political
  support of poor people not deliver basic services
  to them?
• Why are voters not able to provide stronger
  incentives for politicians service providers to
  deliver better service outcomes?
• What is the impact of political market failures
  on basic service outcomes for poor people?

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Some how-to research questions on voice politics

• How can information mechanisms be
  institutionalized that allow voters to provide
  stronger incentives for better performance?
• How to design high-impact sectoral interventions
  that politicians might find easier to commit to
  and take credit for?
• How to unpack notions of political credibility to
  understand its process of change?

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How donors provide aid matters
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Donors and service delivery
Policymakers
Project implementation units
Global funds
Poor people
Providers
Community driven development
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What donors can do to scale up

• Harmonize procedures
• Integrate aid in recipients budget system so
  that accountability is not undercut
• Finance impact evaluations of service innovations
  (300 million/year -World Bank)
• Create conditions for knowledge-driven
  development, particularly in clientelist settings

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Implications for World Bank adjustment lending

• PRSCs in Benin, Ethiopia, Rwanda, Madagascar
  focusing on service delivery
• India Andhra Pradesh, Karnataka, Orissa rising
  social sector expenditures but impact?
• PRSCs supporting service delivery experiments
  with evaluation Ethiopia, Nepal
• Readiness for reform 8 sizes fit all?
• Staffing implications who leads PRSCs?

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Implications for policy dialogue

• Service delivery as entry point in difficult
  political settings
• Middle East and North Africa Governance Report
• Symptoms v. causes of corruption
• Ghost doctors in Bangladesh

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Latin America

• Use WDR framework to understand success and
  failures
• Cochabamba v. Cartagena
• Mainstream impact evaluation
• Cross-fertilizing experiences of evaluation and
  scaling up
• Evaluation now a major emphasis in country
  strategies

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Plans in South Asia

• Background rapid growth in India Pakistan but
  poor service delivery MDG implications
• Fixing service delivery institutions learning
  from success failure
• Power sector tariffs
• Contracting out education in Madhya Pradesh
• Providing knowledge services in high-capacity
  settings
• WDR director will be new Chief Economist for the
  South Asia region

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Services work for poor people when accountability
is strong
http//econ.worldbank.org/wdr/wdr2004