Essential Matter: Social Policy in a Development Context
1 Oct 2001
In recent years there has been increasing recognition of the enabling role that social policy can play in the development process. The burgeoning interest in social policy flows from a number of different currents. First, the spread of democratization through much of Africa, Asia and Latin America has reinforced pressure from citizens to put social issues back on national policy agendas, and has brought renewed demands for economic policies that are socially equitable and inclusive. At the same time, the widespread acknowledgment that orthodox economic policies have tended to depress growth and lead to social polarization and persistent poverty in, and inequality between, countries, has rekindled interest in social policy. This has coincided with and been reinforced by global policy pronouncements on “rights-based development”, which consider human rights to be multidimensional and indivisible, and insist that rights must be respected and enhanced in the process of development.
The apparent consensus on the importance of social policy, however, masks diverse and often conflicting conceptions of social policy, as well as considerable disagreement on how the social malaise engulfing many societies is to be overcome. There are numerous perspectives on appropriate macroeconomic policies; on the respective roles of the state and the private sector in the development process; and on the goals and values that underpin social policy. In some quarters, there is growing fear that globalization is not only reversing some of the social gains embodied in the institutionalized welfare states, but that it is lessening the likelihood that developing countries will have the necessary policy autonomy and fiscal capacity to develop and finance comprehensive social policies. Others contend that the degree to which global economic forces constrain national policy choices should not be exaggerated, and point to the continued dominance of national traditions of interest representation and political consensus building as important parameters that continue to shape policy priorities.
It is against this backdrop that UNRISD has launched a new three-year research project, Social Policy in a Development Context. An international conference, held in Tammsvik, Sweden on 23–24 September 2000, marked the initial phase of the project (see UNRISD Conference News, Social Policy in a Development Context). Issue 24 of UNRISD News brings together excerpts from the papers presented in Tammsvik by six internationally renowned scholars—Ha-Joon Chang, Giovanni Andrea Cornia, Diane Elson, Maureen Mackintosh, Judith Tendler and Laurence Whitehead.
The current rediscovery of “the social” reopens long-standing questions about the nature of “economic” policies that can generate both growth and social development. In their respective contributions, Giovanni Andrea Cornia and Diane Elson delineate the kinds of macroeconomic policies and structural reforms that can meet the dual challenge of being developmental (enhancing growth and structural transformation) and equitable and socially inclusive. Both authors contend that orthodox macroeconomic policies—stabilization, external liberalization and privatization—have clearly failed to live up to their promises and urgently need to be redesigned. The challenge is to pursue stabilization programmes that do not generate large recessions and surges in poverty, by changing the “targets” for inflation and the budget deficit, and by altering the pace of deficit reduction. A similar process of rethinking must inform moves toward external liberalization, which needs to be far more gradual and selective, and must reduce destabilizing short-term capital flows that have been a recipe for macroeconomic and social disaster. Cornia also draws attention to some key pro-poor structural reforms that are widely agreed on by most scholars and yet are “off limits” as far as the policy establishment is concerned—such as redistributive land reform, reform of public expenditure and taxation, and the development of insurance mechanisms.
While Elson joins Cornia in condemning the “deflationary bias” of orthodox macroeconomic policies, she also draws attention to another source of systemic social bias: the “male breadwinner bias” that ties the right to claim social benefits (access to services, cash transfers, pensions) from the state, to full-time, life-long, working-age participation in the labour force. Yet for many, and for women in particular, this model of labour force participation is not the norm. In order to be gender equitable, she argues, full-employment policies must be complemented by social entitlements for those in informal or part-time paid work as well as those who provide unpaid care—as citizens in their own right.
For these social goals to attain greater weight, it is not only necessary to challenge and change orthodox macroeconomic analysis, but also to transform the policy process. The latter needs to become less technocratic and insulated from public debate and scrutiny, and more open, democratic and socially inclusive.
The complex question of how to conceptualize “democracy” and “development”, and their interlinkages, is taken up by Laurence Whitehead. The conventional and minimalist views of democracy (as meaning no more than the holding of competitive elections) and of development (as meaning high and sustained economic growth) do not compel us to recognize their interconnectedness. But as both democracy and development are reconceptualized, the conventional and dichotomous view is slowly being replaced with a superior and integrated policy rationale. One outcome of this reconceptualization is that social policies and citizenship entitlements are gradually moving from the margins to the centre of attention and debate. Yet there is a long way to go before an integrated analytical framework can fully emerge, and several key questions remain unresolved. How, for example, are development priorities to be established and reconciled? Given the fact that most new democracies are likely to contain vast numbers of poor citizens, how can democratization and social development be stabilized and conflicts managed?
The darker side of how politics and social policy can interact is captured in Judith Tendler’s analysis of what she calls the “devil’s deal”—the deal between politicians and myriad small firms (SF) and informal sector (IS) firms whereby political allegiance is exchanged for tacit waiving of tax, labour and environmental regulations. The current emphasis on small and informal sector firms is part of the broader social policy agenda of reducing poverty and unemployment. Yet the dynamics of the devil’s deal, reinforced by the dismissive attitudes often held by public officials toward the SF/IS sector (which tends to be seen as a “social welfare” issue) effectively undermines that broader agenda by condemning this sector to low-level economic stagnation, degradation of the environment and violation of workers’ rights. The blanket support extended to small and informal sector firms may be ideal for garnering electoral support, argues Tendler, but it is less than ideal for generating sustained, employment-enhancing economic development. The latter would require far more strategic and selective assistance, as well as requirements that the cost of environmental and labour standards be met.
In her contribution to this issue of UNRISD News, Maureen Mackintosh reminds us of some of the core objectives and values underpinning social policy: forging egalitarian and inclusive societies through sustained progressive redistribution. More specifically, she focuses on the political economy of redistribution in the case of health care, and draws some pointers from the literature to identify more precisely the conditions that lead to redistributive success or failure. Successful redistribution requires legitimate and reciprocal social relationships (whether through social insurance or public provision). It is more likely to happen where rights to health care have been fought for as an element of citizenship. It is easier to build inclusive and redistributive health care systems where private provision is not (and has not been) dominant. She also warns that we should not expect too much redistribution to occur in small communities. These are valuable lessons that raise serious questions about some of the cherished policies promulgated through the dominant health and development agenda: privatization, safety nets and community provision.
In The Last Word, Ha-Joon Chang takes us to East Asia, rejecting the argument that East Asia was “economically” successful because it was a “social policy-free zone”. He contends that it was only because of a range of “social policies”—some more implicit than others—that the East Asian countries managed to achieve social peace and economic prosperity. It may be possible to increase the “efficiency” of the East Asian economies by abolishing some of these provisions, as some internal and external critics claim, but this is likely to increase social tensions and political unrest, and may ultimately damage their prosperity. However, this is not to deny the need for social policy reform, as many of these countries have a long way to go before they can claim to have established genuinely inclusive and cohesive societies. As the other contributors would remind us, the latter is not merely a technical matter, but a crucial element in the fight for democratic governance.
Shahra Razavi is a Research Co-ordinator at UNRISD.
This article reflects the views of the author(s) and does not necessarily represent those of the United Nations Research Institute for Social Development.