Embedding Multidimensional poverty for structural recovery

Programme Director, Distinguished guests,

It is a great honour for me to be invited to this Research Colloquium on Multidimensional Poverty in South Africa. I am humbled by the opportunity to be engaging with you around poverty and multidimensional poverty in particular. We are all confronting a deadly and unprecedented pandemic with social and economic effects that are threatening to undo long-terms gains achieved by the government and the people of South Africa. In the UN, we recognise that these annual colloquiums have created great opportunities to build knowledge, awareness and networks and provide dynamic solutions for addressing the twin scourge of poverty and inequality.

South Africa’s monetary poverty rate of 55.5 per cent (using the Upper Bound Poverty Line) is high by any standards and indicative of the work that lies ahead. While the country has made impressive gains in addressing poverty between 2006 and 2011, since then the trend has not been rosy. The recent decline in economic output per person combined with structural challenges in the South African economy meant that a larger percentage of the population is forced to live below the various national poverty lines. 

While a growing economy and increased efficiency in government services will undoubtedly help with the country’s recovery, the latest developmental thinking suggests that both monetary and multidimensional poverty approaches need to be taken seriously. 

The UN through the SDGs framework is committed to ending poverty in all its manifestations and that’s why we have adopted various monetary and multidimensional poverty targets. This conception of poverty and inequality embedded in the UN’s SDGs recognises that poverty is much broader than a mere absence of cash and income and that comprehensive social protection systems are vital in the fight against poverty and inequality. 

The Global Multidimensional Poverty Index (MPI) that the UN adopts to measure multidimensional poverty covers education, health and standard of living as key poverty dimensions. In South Africa, the MPI is adapted to reflect the country’s own conditions and thus includes economic activity. With that, it captures unemployment broadly defined to include the unemployed as well as the discouraged work-seekers. This adaptation is very fitting, as in this way the index captures a key poverty facet among the South African poor. Of course, the index is not perfect as it leaves out other critical poverty dimensions and determinants such as threat from violence and different forms of inequality. 

Another important aspect I would like to highlight is that the various dimensions of poverty are inter-related. Research conducted over the years have shown that growth of national incomes contributes to reduction in infant mortality, that women’s education and social status are key factors behind reduction in child malnutrition and that income distribution is an important determinant in child’s stunting and underweight. 

According to the 2020 UNDP Report “Charting pathways out of multidimensional poverty: Achieving the SDGs”, 1.3 billion people across 107 developing countries – or 22 per cent of their total populations, live in multidimensional poverty. Among those poor, half are children and 84 per cent live in Sub-Saharan Africa. Before the pandemic, half of the countries (with data trends) covered by the study were on track to half poverty between 2015 and 2030. However, the Report warns that if the impacts of the pandemic are left unaddressed, progress in reducing multidimensional poverty could be set back by between 3 and 10 years. To be sure, a setback as a result of a crisis as the one we are currently experiencing can be avoided, provided the limited resources at disposal are targeted to the social sectors. To illustrate my point, according to the UN Report, Sierra Leone has experienced a fast reduction in MPI value and this occurred during the Ebola crisis.

According to the Statistics South Africa, the South African Multidimensional Poverty Index, which includes unemployment as I have just noted, shows that multidimensional poverty in the country declined by more than half in the 2000s – from 17.9 per cent in 2001 to 8 per cent in 2011 – and then to 7 per cent in 2016. However, it is unfortunate that we have been witnessing reversals in some health and social indicators that are behind key poverty dimensions. Stunting in children under 5 increased from 24 per cent in 2008 to 27 per cent in 2016 – and, after many years of gradual decline, infant mortality rate raised from 22.3 to 35 deaths per 1000 live births between 2015 and 2016. Access to improved water facilities declined, albeit slightly, from 87.5 per cent in 2015 to 86.4 per cent in 2017. And, as we all know, unemployment broadly defined, which had been going up, has accelerated during the pandemic.

Multidimensional poverty approaches, in their bare essence, are about ordinary people’s access to public services. Hence, to address multi-dimensional poverty in its broadest manifestations, provision of a wide variety of services should be expanded to help ordinary people sustain their well-being and dignity. This places the focus on the government’s public service record. 

In the period post-1994, the government has made strides in their attempts to address inequities in service provisioning. Successive annual General Households Surveys are clear on gains made in access to piped water, sanitation, electricity, housing opportunities, social welfare and social grants, free basic education, the provision of nutritious school meals for needy children, and the extension of basic healthcare to qualifying mothers and their children. 

The government’s commitment to what it calls the “social wage” has been impressive and these spending obligations have been continued during various challenging times, including the aftermath of the global economic crisis in 2008 and the more recent COVID-19 pandemic.

In the current crisis, the government committed 10 per cent of the country’s Gross Domestic Product to fight the effects of the pandemic and meet its explicit and implicit contingent liabilities. While these efforts are commendable and deserve special praise, COVID-19 poses additional challenges and should strengthen all our resolve to maintain the government’s commitment to a national social wage.

So what is the extent and scale of the challenge in maintaining a social wage in South Africa? 

Given the impacts of the COVID-19 crisis on the government’s fiscal accounts, that challenge is of considerable magnitude. Public debt is rising very rapidly as a result of the crisis. In order to stabilise the debt trajectory in the coming years, it is clear that the government will make important policy decisions in the near future. This may challenge the present consensus on what to finance over the short and medium-term. The UN stands ready to support the government, irrespective of the broader expenditure and policy course chosen. At a minimum, access to key public services such as basic education, primary health care, the provision of social grants and the implementation of a social protection floor will form the fundamentals of the government’s strategy and our engagement with the government. This challenge is not only a quantity challenge, but as you know, quality of services has been key to the evolution of the policy agenda in South Africa. 

Given the likely expenditure reductions, we are called upon to work more closely with the government and social partners to ensure that the social and economic gains of the last two decades are not reversed. No single social partner has all the answers, but we are likely to achieve far more working together in addressing the present fiscal and social challenges. 

Forums such as the present research colloquium and policy debates in national and provincial legislatures provide opportunities to stay connected and engaged with the government’s policy decisions in the aftermath of COVID-19. 

I am very clear that both civil society and development partners have to introduce a level of technical and conceptual innovation in the work we do with the government. There are simply not enough resources to finance every priority and those services that do get the nod must be implemented effectively and efficiently. However, the challenge is not only technical: we have to work with government in democratic spaces that afford meaningful civil society participation. 

In addition, it is my sense that private sector engagement in the process would be very valuable. In this regard, we should not miss the opportunity to consider innovative ways to attract private financing to the generation and delivery of public services. Greater effectiveness and efficiency of public services may also be achieved through actions at the District Level Development Model. This would allow us to operate closer to the direct beneficiaries. Moreover, active participation of local communities in the process must be encouraged as that would be critical to the achievement of positive outcomes since they know better what their most urgent needs are. 

This research colloquium – with its varied government and non-government partners – presents an excellent opportunity for doing just that. The fact that senior government officials continue to honour participation in this event is evidence of the overall relevance and durability of the policy message embedded in this research colloquium. 

While the pandemic has revealed the country’s existing fault lines linked to the high levels of inequality, we also have a unique opportunity to contribute to dynamic policy support and evidence to move the county away from its apartheid past. In the UN, we are trying to do this through our social protection platform and our various socio-economic working groups. These platforms interact directly with official structures in government, thus ensuring that our broad partnerships find resonance in the policy work that we do with the government. 

None of us can address these challenges alone. It requires partnership, unity and the forging of dynamic and supportive pathways to each other. The opportunity like this one will maximize our strengths collectively, broaden our knowledge and we will learn from each other and carry the lessons learnt forward.

By working together, with a sense of urgency, we can achieve more!

Thank you very much.