By Bob Deacon
February 1999 The UK government, through the intervention of the Chancellor Gordon Brown, has made a significant contribution to the debate about how to regulate the global economy not only in terms of financial flows but also in terms of the social dimension of globalization.He has argued for a Global Social Policy Code. This would be a "code of global best practice in social policy which will apply for every country, will set minimum standards and will ensure that when IMF and World Bank help a country in trouble the agreed programme of reform will preserve investments in the social, education, and employment programmes which are essential for growth." Moreover this code "should not be seen in narrow terms as merely the creation of social safety nets. We should see it as creating opportunities for all by investing more not less in education, employment and vital public services" (Speech entitled Rediscovering Public Purpose in the Global Economy, Harvard, Dec 15th 1998).
It is suggested by him that this code should be agreed at the next meeting of the World Bank meeting in spring1999. The question, therefore, is posed as to who and how will this code be devised. It has fallen to Robert Holzmann as Director of the newly created Social Protection division of the Human Resources Network of the Bank to formulate this. Some initial thinking was provided by the Social Development Section of the DFID of the UK government. It suggested that best practice in social policy involved a)equitable access to basic social services health, education, water and sanitation, shelter; b)social protection enabling individuals to reduce their vulnerability to shocks: and c)core labour standards.
Two questions arise. First what does the track record of Bank policy making in this field suggest might be the slant of this new global code if left to them?
For a final answer we must await the articulation within the next few months of the World Bank's Social Protection sector strategy paper. Some clues as to its orientation already exist. The social protection section, in the terms of its own publicity material, says it is meeting the challenge of inclusion by focusing on risk management by 'helping people manage risks proactively in their households and communities'. Within this remit it is working on labour market reform, pension reform and social assistance strategies including supporting NGO and community social funds in many countries. This suggests a strategy which emphasizes individual responsibility to insure themselves against the increased risks and uncertainties of globalization rather than one that puts emphasis on governmental responsibilities to pool risks and to universalize provision. Holzmann concentrates on pension policy (1997a,1997b,1997c,1997d) and has lent his support to the multi-pillar approach to pension reform (1997b) which would reduce the state PAYG schemes to a minimal role of basic pension provision, supplemented by a compulsory and fully funded and individualized second pillar and a voluntary third pillar.
Second how should other global actors with a right to a view on this code: ILO, UNICEF, WHO, UNESCO, UNDP, the UN Economic and Social Secretariat, global trade unions, global civil society etc. have their say? If we are to build a global economy that takes the social dimension seriously then we need forms of global social policy formulation that stand in the tradition of consensus politics and tripartism. The initiative by the UN Social Policy and Social Development Secretariat to formulate a policy for the social dimension of globalization needs to engage with this Global Code of Social Policy. The ILO and other UN social agencies need to make their input. A wide ranging discussion is needed , not a quick fix at the next meeting of the Bank. A code owned by all could be agreed at the Copenhagen plus 5 meeting scheduled for June 2000.
A code for best practice in social policy should not slant too far in the direction of targeting and privatisation. It would have to explicate what the alternative poles of universalism and public responsibility might mean for countries at different levels of development. At the same time such an approach of universalism appropriate to the level of development needs to be coupled with explicit pro poor development polices to avoid the charge that the poor countries should settle for less.
Chen and Desai (1997, pp 432) reminded us recently, having reviewed the positive experiences of those countries that combined economic growth with conscious social development (Botswana, Mauritius, Zimbabwe, the Indian State of Kerala, Sri Lanka, the Republic of Korea, Malaysia, Barbados, Costa Rica, Cuba) that. The key ingredients to successful social development appear to be responsive governments, socially friendly economic policies, and the universal provisioning of social services. In all these endeavours the role of government is central.
Here are some initial ideas for a global best practice in social policy code that are born of what we know from history, research and comparative study about what kinds of polices best meet human needs.
Universal entitlements to a share in one of the main means of livelihood of the society: land, paid employment, micro-credit,
Entitlement to income compensation when these are not available
Government regulated and citizenship contributed compulsory social insurance provision to pool risks and to cover for all risks. (unemployment, sickness, disability, survivorship, old-age)
Equitable access to the level of health care and education affordable at the level of development
Mechanisms to ensure universal access to adequate water, food, sanitation. (food subsidies of basics in a market economy even if the subsidy also benefits the middle class remains an important mechanism of social solidarity)
Tax and benefit processes that win the universal commitment of all to their funding and provision,
Involvement of civil society institutions, local NGOs in the articulation of needs and in aspects of social provision without undermining governmental responsibility for the standard and regional distribution of services
Provision for the regulation of private and not-for-profit services which discourage market skimming and dumping higher risks on the state,
Governmental mechanisms which enforce core labour standards, UN human and social rights, and regional social charters where they exist
Economic development strategies which are pro-poor and encourage labour
growth with adequate remuneration
Chen, I and Desai, M. (1997). Paths to Social Development: Lessons From
Case Studies, in Mehrota, S. and Jolly, R. (1997). Development with a
Human Face, Oxford, Oxford University Press.
Remaining bibliography can be found in Deacon, B (1998) Towards a Socially
Responsible Globalization, GASPP Occasional Papers No. 1 which can be
downloaded free as ocpap1.doc from the news page of the gaspp web page.
Bob Deacon is Director of the Globalism and Social Policy Programme (GASPP).
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