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ADB-Principles and Philosophy Underlying County Poverty Alleviation Planning-China Case Study

ADB-Principles and Philosophy Underlying County Poverty Alleviation Planning-China Case Study

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Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP


by Asian Development Bank ( ADB, 2001)


Principles and philosophy underlying County Poverty Alleviation Planning (CPAP)
1.1 Introduction
38 No country in recorded history of recent economic development has achieved as much in reducing rural poverty than China (Wang 2001, World Bank 2001, 1992; LGOP, UNDP and World Bank 2000, and UNDP and ILO 2000). Against an official rural poverty line of $USA0.66 per person per day, the incidence of poverty in China is estimated to have declined from more than 300 million people in 1978 to 120 million in 1988, and 42 million in 1998 (LGOP, UNDP and World Bank 2000). Even against the World Bank’s more stringent poverty line of $USA1 per person per day, the number of rural poor is estimated to have been 287 million in 1991, falling to 106 million in 1998 (World Bank 2001b). In 2001 the State Council announced a new national poverty reduction strategy, based on village poverty reduction, which revised the 8-7 Poverty Alleviation Program introduced in 1994 (People Daily, 2001) This policy initiative reflects the determination of the State Council to continue China’s good record in poverty reduction and reverse what is widely recognized as evidence that rural poverty reduction has stalled, if not reversed, since at least the mid 1990s (World Bank 2001b). The new national poverty reduction strategy, based on county led village poverty reduction, referred to here as County Poverty Alleviation Planning (CPAP), has set a goal for the abolition of rural poverty for all 30 million poor in China’s key working counties (KWCs) over the next decade. (People Daily, 2001) 39 This report is a collaborative contribution to the reassessment by China of its national poverty alleviation strategy. It responds to concern in China and elsewhere that extant poverty alleviation policy, which has served China well for more than two decades, is in need of revision to stem the leakage of poverty resources and tighten national focus on reduction of hard core poverty. In May 2001, the State Council convened a national consultation on poverty in China, coordinated by the Leading Group Office of Poverty Alleviation and Development (LGOP), the State Council's premier body for formulation and implementation of national poverty intervention strategies. The result of this meeting was a decision to address hard core poverty by directly targeting poverty at its source, in village China. This paper is a contribution, at the invitation of the LGOP working in collaboration with the Asian Development Bank (ADB), to the thinking that is on-going concerning the methodological implications of this important policy decision.

1.2 Institutional Change, Governance and Important Poverty Policies
40 Poverty policies in China have encompassed four major strategies between 1950 and 1980. 13
ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.2001

Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP)

by Asian Development Bank ( ADB, 2001)
41 The first strategy, implemented in the 1950s, involved a land reform program that enabled poor farmers to gain access to land, which was further strengthened through later initiated rural collectivization movement albeit only within the framework of state farms and rural production brigades. 42 The second strategy focused on the modernization of China’s economy through the industrialization of manufacturing and rural production, a primary outcome of which was a significant shift in employment from the rural sector to the urban after the end of 1970s. 43 The third strategy, first adopted in the 1960s, was a national welfare program called the Five Guarantees for Households in Extreme Poverty in both rural and urban areas (Shi Youjing 1999). The five guarantees program, administered by the Ministry of Civil Affairs, has been especially important to the aged and the disabled, as well as those in rural households subject to chronic food insecurity for all or part of the year. Nonetheless, financial constraints meant that this welfare program was always limited in its outreach, with not more than one percent of the rural population and less than one percent of the urban population covered. 44 The fourth strategy utilized central government subsidies for poor region development, to support provincial programs in education, healthcare and related human resource development expenditures, plus infrastructure development. The latter typically dwarfed the former my a factor of ten. Central government support of this sort was managed by the State Development Planning Commission (SDPC), using top-down planning methods reflecting political priorities and resource availability rather than locally defined needs or opportunities. 45 Prior to 1980, these four strategies constituted national poverty policy, but there is no sense in which these four independent strategies amounted to a well integrated and systematic approach to planning, monitoring and evaluation of national poverty reduction policies. 46 Significant national poverty policy reform in China had to await, rural sector reform, which was launched in earnest towards the end of the 1970s as part of China’s bold steps into the international networks of world trade and economic modernization through joint ventures with foreign partners (Lardy 1992, Watson 1994, Findlay 1995, and Sun and Parikh 1999). Adoption of the individual responsibility system, to replace wholesale control of rural production decisions dictated from above through production brigade hierarchies, brought about a remarkable change in the productivity of rural household production and sustained increases in average rural household income (Longworth 1989). 47 In step with the shift in favour of market driven rural production decision making under the household responsibility system, the GoC also established a central body called 14
ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.2001

Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP)

by Asian Development Bank ( ADB, 2001)
the Leading Group for Three West Area Reconstruction, which was affiliated to the SDPC under the leadership of the State Council, and which has evolved into the Leading Group for Poverty Alleviation and Development (LGOP). In 1982, the State Council launched the Three West Area Construction Program, under which program a large-scale land reclamation, irrigation and resettlement program was adopted for the resettlement of 700,000 people into reclaimed irrigated areas. The program involved an annual commitment of ¥200 million, 1983 to 1993 (Li Zhou 2001, Lin Zhibin 2002). This resettlement program was based on official belief that poverty in the western areas targeted is the result of natural conditions that can not support people’s livelihood above the poverty level without resettlement. No attempt was made to confirm or test these assumptions against local people’s perceptions of the reasons for their poor livelihood and assistance needs (Lin Zhibin 2002). Planning for the Three West Area Construction Program was carried out based on top-down methods, including externally sourced technical assistance, which addressed irrigation as the single most important constraint to improved rural production, the complex of community knowledge of their environment, social and cultural issues notwithstanding. Nonetheless, official attitudes reflected the growing belief that the beneficiaries of such schemes should contribute to the cost of their resettlement. 48 In the past two decades, user pays philosophies of development have become increasingly popular in development planning in China. However, it took time for the public sector to realize that the implementation of user pays strategies also increases the level of attention that must be given to targeting and the distribution of the benefits of development investments. Hindsight has shown that rural households that are either not poor or not among the poorest households have an advantage in garnering the benefits of top-down poverty reduction development planning. The least poor rural households are better prepared to benefit from resettlement schemes, and more likely to resettle successfully than their poorer neighbors. User pays provisions based on household contributions to matching fund programs exclude the poorest from participating, with the result that the poor continued to lack access to irrigated areas, resettlement schemes notwithstanding. Meanwhile, benefits from these schemes also proved increasingly unsustainable as conflicts over natural resource use, particularly access to water, water pricing, and secondary salination in the reclaimed area were not carefully examined. Government officials tended to rely on feedback and advice from the better-off households with the result that resettlement programs were increasingly divorced from their original target of helping the poor to achieve sustainably improved livelihoods. 49 In addition to resettlement schemes, in 1983 the Government of China announced its decision, ‘to help poor areas change their backward situation into prosperity’(Shi Youjing 1999). This decision reflected the seriousness with which the central party committee of the Communist Party of China regarded the challenge of rural poverty. Assistance came in the form of a major Work for Food program, under which ¥2.7 billion per year of food would be distributed to poor people in exchange for work to upgrade 15
ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.2001

Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP)

by Asian Development Bank ( ADB, 2001)
rural infrastructure. The program, which distributed in excess of ¥3 billion of food in 2000, is managed by the SDPC and has a reputation for effective poverty targeting in the 10 designated poor provinces and regions in which it has been implemented. (Zhu Lin 1996) Nonetheless, the program has suffered because implementation is planned according to the availability of funds rather than needs. The Work for Food program has not responded to a systematic planning process informed by local people’s participation in planning and needs assessment. But, the program did represent methodological progress, for it employed a multi-agency approach that allowed related agencies at county level to contribute under the coordination of the planning commission. The multi agency strategy not only made it possible to address poverty as a multi-issue challenge, but it also precipitated debate on matters of governance (Li Zhou, 2001, Watson 1994) 50 China’s formal national poverty alleviation program was officially started with the establishment in 1986 of the Leading Group Office for Poverty Alleviation and Economic Development in Backward Areas (LGOP). This group, which came to be known simply as the Leading Group, brought together the heads of the main in-line ministries and agencies that were perceived by the State Council as key policy making and implementation stakeholders whose cooperation is essential for a national approach to poverty reduction. 51 At its first meeting, the LGOP defined absolute poverty in China as resting on four criteria: (i). annual per capita income of USD 53 (in 1985 prices); (ii). food deficit for at least 3 months a year; (iii). lack of access to drinking water at less than 2 km horizontal or 100m vertical distance from the home; and (iv). lack of irrigation water for at least 6 months of the year. Great gains were made in poverty reduction under this system. The incidence of poverty across China is estimated to have fallen by 210 million persons between 1980 and 2000. At its first meeting the LGOP also identified China’s national poverty goal as meeting the basic needs of all the poor by 1990. Thereafter, poverty eradication would be a priority in China’s western provinces, in the old revolutionary provinces of central and southern China, and provinces where minority populations represent a significant proportion of poor households (LGOP, 2000). 52 By the start of the 1990s, the LGOP had refined these broad priorities to highlight central government support for the development of local economies through the promotion of small and medium enterprises utilizing local resources. This shift heralded a decade of public sector subsidies for the formation of township and village enterprises (TVEs), which were meant to create off-farm employment opportunities for the rural poor. It also meant the provision of central government funding for local infrastructure development, particularly road construction, communications and water storage and reticulation systems. China’s commitments to resettlement of rural people into newly developed irrigation areas and infrastructure development through Work for Food were incorporated into the LGOP’s mandate. Gradually each province established its own equivalent to the LGOP, which resulted in the formation of a nationwide network of provincial and county based Poverty Alleviation Offices (PAOs) for organizing and implementing the LGOP program. Funding 16
ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.2001

55 In 1994. Meanwhile all ministries were directed by the central government to take responsibilities for poverty alleviation. At household level. and 80 million poor as the number of people by which the incidence of poverty would be reduced by 2001. 54 Almost all ministries developed programs that were pro-economic growth. Benyon et al. would maintain the rate at which the incidence of poverty had been reduced through the 1980s. the government released its new anti-poverty strategy called the 8-7 Poverty Alleviation Plan. a small-scale loan program was introduced for the first time. 53 China’s national poverty program received funding in both grant and loan forms. both in terms of area and population. It did not help that projects within ministry programs were mainly designed by officials and experts. The programs favoured by individual ministries were not designed for group targeting. to be actioned through their own in-line staff at the local level. the linkage between different ministries and the LGOP was very weak. Impact monitoring was almost non-existent. with the result that the leakage of poverty funds to non-poor households or groups in rural China increased (IFAD and WFP 1999. but mainly for geographic or area targeting. while the State Statistics Bureau was made responsible for impact monitoring (LGOP. Further. China had a poverty alleviation program that was networked through the LGOP and local PAOs. The LGOP was responsible for all aspects of poverty reduction planning under the 8-7 program. which throughout the 1990s were allocated to each province according to proposals received from each province. The 8-7 plan identified 592 poor counties as primary targets of the national poverty alleviation program. and committed to infrastructure improvement. 17 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. 2000). Linkages among the ministries were even weaker. However. These proposals were meant to reflect the magnitude of the poverty reduction target set within the provincial development plan by the Provincial Planning Commission in consultation with the LGOP and the local PAO. explicit monitoring of the impacts of ministry programs on the livelihoods and welfare of poor households was not easy to achieve. Consequently. This procedure legislated the poverty alleviation program national wide. therefore. with the result that each ministry set up its own internal office for poverty alleviation. health and cultural aspects of development. under this strategy. The annual State Council-LGOP meeting on poverty was the only real chance for the exchange of experiences. LGOP. the 8-7 plan introduced innovations in program integration. UNDP and World Bank 2000. This plan sought to address some of these shortcomings. in the hope that more explicit poverty targeting. funded from the ministry’s own resources.2001 . By the start of the 1990s.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. but with individual ministries free to develop and implement their own poverty alleviation activities. supportive of TVEs. with shifts in policy and governance decreed to raise the priority given to education. funded via policy loans distributed and administered through the Agricultural Bank of China (ABC). following the LGOP model. 2001 and World Bank 2001b). 2001) was secured through the central budget with a formal allocation specified in the national Five-Year-Plan. with very weak or no participation by poor households in the programming process.

Poverty reduction planning was almost entirely top down. Over the same period. reflected in a rising proportion of poverty resources that never reach the poor. poor villages. The result was a national poverty program that by-passed the poor and exhibited signs of stalling. 2001) 56 The 8-7 Program was an important advanced in national poverty policy in China. In the rural sector. and (iii) increasing income inequality. as did the pressure/incentive for rural people to migrate to urban areas in search of work and a better livelihood. sensitive border areas that suffer poorly developed infrastructure. 57 In May 2001. (i) Future poverty policy would be directed at the geographic source of poverty in rural China.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. previously delegated to provincial agencies. County authorities would assume responsibility. it did not stem the leakage of poverty resources to the non-poor. Rural unemployment increased. 70% of the rural labor force still found its primary employment in agriculture. in part because of poor poverty intervention decisions associated with failed investments in TVEs using LGOP sourced poverty funds. the national list of poor counties would be replaced by a list of Kew Working Poor Counties (KWCs). which are heavily concentrated in China’s western provinces. The participation of poor households in project design was not encouraged. Key poverty reduction trends were no longer on the improve. The new policy shifted the geographical focus of poverty policy in two important ways. In its recent report on poverty in China. and (ii) national policy would concentrate on village poverty in the poorest regions in China. the old revolutionary bases in provinces which had harbored the industrial heart of the Maoist revolution following the long march of the 1940s. coordinated by the LGOP as the newly authorized public sector agency responsible for national poverty reduction strategy formulation. The 8-7 plan lacked pro-poor targeting procedures. the State Council convened a national poverty alleviation meeting in Beijing. However. In the latter years of the 1990s. which deteriorated by 23% in rural China during 1988-95 (World Bank 2001b. this outcome was reflected in the fact that while agriculture’s contribution to GDP declined from 23% in 1985 to 12% in 1998. At this meeting the State Council endorsed a new national poverty reduction strategy to address the problem of hard core poverty and the leakage of national poverty resources to the non-poor. and areas with significant minority populations. and attention to sustainability was followed more in rhetoric than in reality. China’s 592 nationally designated 18 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. rural off-farm employment grew by less than 5 percent. Gender issues were not given any great prominence. yet the numbers employed in agriculture fell by 10 percent. UNDP and World Bank 2000). Within these priority areas. and it did not provide a mechanism by which the benefits of economic growth could be biased in favour of the poor. for ensuring that poor villages are integrated into and national poverty planning processes. and LGOP. gross domestic product (GDP) increased at twice the pace of household income. policy design and implementation. the World Bank and UNDP attribute the failure of poverty trends to keep improving to three main factors: (i) ineffective poverty targeting.2001 . (ii) perverse fiscal policies that have lead to taxation systems in which the poorest 20% of rural households are paying 50% of taxes collected in rural areas. 58 Since the May 2001 national poverty meeting.

especially the Ministry of Finance (MoF). 61 China’s village poverty reduction strategy is based on participatory approaches to the analysis and redressing of key sources of chronic poverty in China. monitoring and evaluation. Although CPAP has been developed with KWCs in mind. which continues to be eligible to access national poverty funding even though counties in Tibet are not included in the list of KWCs. with no power to manage or organize its operations without the approval of the MoA hierarchy. must develop and fund their own poverty reduction programs. of which 38 counties were located in eastern and central provinces. Only KWCs are eligible to access national poverty reduction funds. at income and employment generation initiatives identified by VPRGs. Village Poverty Reduction Groups (VPRGs) will need to be formed to take the lead in village poverty reduction planning. and the Agriculture Bank of China (ABC). Previously the LGOP had been imbedded in the Ministry of Agriculture (MoA). Village poverty reduction planning is the heart of the new program.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. 2001) poor counties. 59 Associated with the announcement of VPR as the core of China’s new national poverty reduction strategy are a number of important changes to governance of poverty policy formulation and implementation. though the Government of China has directed that counties not included in the list of KWCs. The LGOP has been given the lead roles in poverty planning. The State Council has now separated the LGOP from the MOA. progress monitoring and impact assessment. Tibet has been given special treatment as a strategic autonomous region. now almost all of which are in western provinces.2001 . community based planning and an expanded role for NGOs in poverty policy implementation. and ensuring that national poverty reduction resources are directed. It is left to the LGOP to ensure that the methodology and guidelines to be applied in implementing village poverty reduction are appropriate and flexible enough to account for socioeconomic. setting of specific poverty reduction targets for each plan period. finance. those not included in the list of KWCs. The role of county government is limited to ensuring that village poverty plans are integrated into the County Development Plan (CDP). cultural and geographic differences between counties. With the assistance of the county LGPO. Because the 19 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. policy development and implementation. it does not follow that the community based participatory poverty reduction planning methodology developed for KWCs is inappropriate for other counties. gender. establishing the LGOP as a formal public sector agency with its own functional structure to deal with both internal and external matters. which have significant numbers of poor households. have been replaced in the national poverty reduction program by 592 KWCs. with individual village plans based on the situation specific needs of the poor. 60 Other governance changes arise from the shift in national poverty reduction policy to embrace participation. the State Statistics Bureau. the State Development Planning Commission (SDPC). and coordination of the involvement of stakeholder agencies. The most prominent change is the institutionalization of the LGOP as China’s premier independent agency responsible for all aspects of national poverty reduction planning. through local LGOP offices. Tibet excepted.

it is no longer possible to assume that past policies merely need minor refinement. using the rich lode of local knowledge held by village communities to identify sustainable income and employment generation activities for inclusion in village poverty reduction plans. However. but the increased emphasis given to participatory. what is it that has caused the State Council to determine that a shift in strategy is needed in national poverty policy and practice at this time? The answer is likely to be complex. using participatory methods of problem analysis. bottom-up procedures does imply some important changes in governance at both national and local levels. and should be seen as a further step towards democratic processes in an important aspect of Chinese public policy. including county based offices of the LGOP. First. and change of this sort rarely comes without some opposition. Nor is recourse to participatory approaches in poverty reduction planning and implementation a minor change. 2001) county is the lowest level of local government to which national authorities have direct contact. 62 It is the commitment to participatory approaches that marks CPAP critically different from predecessor strategies of national poverty reduction policy. provincial and township officials have a 20 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. but when all is said and done it is probable there are just two issues that constitute the fulcrum on which this policy evolution moves. the methodology underlying the national strategy has been dubbed County Poverty Alleviation Planning (CPAP).2001 . the changes needed in key areas of national poverty policy governance cannot be minor. China is concerned that the challenge of poverty that remains is fundamentally different from that which has already been addressed. CPAP is a further devolution of poverty planning in China towards a needs and demand driven framework.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. as compared to a centrally controlled bureaucratic process. solution identification. Shifting responsibility for accountability for the delivery of national poverty funds to the poor from the province to the county is not a minor change. CPAP builds from the village up. in the face of entrenched desperate poverty at village level. As a result. 64 Those active in national poverty policy implementation are aware that. activity designs. administration of the policy will be coordinated through county based authorities. 1. If this leakage is to be stopped. This is a laudable and understandable goal. The poverty that remains in China is dominated by what can be characterized as 'hard core poverty'. there is a desire by the State Council that this shift should be accomplished with a minimum of conflict or reform of existing LGOP managed governance of national poverty alleviation policy and practice in China.3 Motivation for Change in National Poverty Policy 63 One might ask. Second. The devolution is to be welcomed. the GoC is very aware that the lack of progress in poverty reduction in recent years is linked to the serious leakage of national poverty reduction funds to the benefit of those who are not poor. In order for poverty reduction planners to understand what causes hard core poverty to persist. budgeting and progress monitoring and impact assessment.

Participatory village poverty reduction planning is this new approach. Hebei. (iii) greater village level self-reliance for sustainable poverty reduction through the use of participatory approaches to location specific poverty reduction interventions. Guangxi and Qinghai provinces. if only because the shift has signaled a significant clarification of goals for national poverty policy. The opposite is the case. so named to make explicit its key role in CPAP. 65 Neither the State Council nor the LGOP are so naïve.2001 . the hard core poor have been by-passed and poverty reduction resources have 'leaked' to the benefit of the non-poor.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. In recognition of these outcomes of current strategy. (ii) increased poverty reduction through the capture of poverty reduction fund 'leakages'. one that will target the hard core poor in ways that significantly increase the probabilities that sustainable poverty reduction will be achieved. CPAP proposes the formation of a new administrative group at village level to provide grass-roots leadership and facilitation services for participatory village poverty reduction planning. The existing Village Committee. those responsible for national poverty policy in China are keen to see that the governance of CPAP will involve a minimal set of bureaucratic reforms. and gradual re-education within existing administrations to the realities of participatory poverty reduction planning. A result of this process has been the channeling of support for TVEs. This group is called the Village Poverty Reduction Group (VPRG). the State Council has determined that a new approach is needed. towards investments in productivity based growth in capacity for self help in poor villages. give the authors cause for confidence that local level support for CPAP is constructive and readily forthcoming. and user-pays strategies of service delivery by local government. 67 The VPRG is inclusive. and (iv) the repositioning of national poverty reduction programs to move away from relief and welfare payments to the poor. This paper reports positively on several action research field tests of CPAP which. governance changes notwithstanding. In the main. change is heralded by this shift in policy. These goals are: (i) more effective targeting of poverty reduction resources at the abolition of hard core poverty. however. Institutional changes will be needed at village level to accommodate the different roles that will be played by existing planning and poverty reduction agencies and local government authorities. with administration shifted from provincial and township levels to counties. Nonetheless. As a result. only some of which have in fact led to benefits for poor people in the poorest villages in China. 66 Participatory poverty reduction planning is new to China. 2001) strong incentive to attempt to get the best outcome for the limited poverty alleviation resources at their disposal. together with supporting feedback from CPAP training exercises conducted in Fujian. consisting of the Village 21 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. It is a step along the path to rural democratization that parallels national trends towards smaller government. as to believe that a policy shift such as CPAP represents will not meet bureaucratic inertia or resistance. Gansu.

A national program of 'training of trainers' for CPAP is implied. Gansu. CPAP will not solve this problem. (Zhu Lin 1996. A poverty reduction 'bonus' will be added to poverty reduction activities done under CPAP by the extent to which VPRG proposals have a leveraging influence on the priorities adopted in county development plans that target the poor in poor villages. but for the purposes of the participatory exercises needed to achieve effective village poverty reduction planning it is not inappropriately so. Li Ou. Guangxi. Li Xiaoyun 1997. 71 One area of national poverty policy in China that has not been changed by the State Council is the commitment to the need for close collaboration between many stakeholder institutions. Multi-institutional participation in national poverty policy has been one of the strengths of China’s approach to poverty reduction since at least the early 1980s. This has meant that in addition to the flow of national 22 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. This is a large group. The Party Secretary. to take charge of the administrative details that must be considered to ensure that the logistics for participatory village consultation. but it can help to significantly reduce the leakage. if nothing else. Park 1999. are members. Sichuan and Xingjiang. ministries and agencies. By going directly to the county. World Bank 2001) 70 Under CPAP. plus at least one representative from each 'functional' poverty group into which households in the village can be divided. should produce a dividend in terms of lower administration and transactions costs. Less of the budget for poverty reduction activities will be needed just to trace and document the paper trail of bureaucracy. CPAP addresses county poverty priorities rather than township or provincial development planning goals. To their number is added the village teacher and health worker. However. and the leader of the Village Women's Group. the Village Accountant.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. 68 It is expected that the Village Committee will act as an 'executive' for the VPRG. below. it is the responsibility of the VPRG to bring forward proposals to the County Poverty Alleviation Office (CPAO) that are tailored to address the causes of hard core village poverty. Hebei. the most important method by which poverty reduction resource leakages is expected to be cut is through more effective and deliberate targeting of poor people and poor areas.2001 . 69 The leakage of poverty reduction resources to the non-poor has been a concern at State Council and LGOP level for some time. CPAP by-passes two levels of government. 2001) Leader. data gathering and mobilization of village people into CPAP procedures can be done well. the typical VPRG will consist of 15-20 people. (See Chapter 8. A serious studies on the issue in China’s poverty alleviation program have shown that lack of attention to targeting has meant that resources intended to go to the benefit of the poor have leaked to the benefit of others. which. If the average Village Committee is responsible for a community of 50 or so households and 4 natural villages. 1996. and has already been initiated in the provinces of Fujian. for further details on CPAP capacity building). a representative from each 'natural village' for which the Village Committee is responsible. Hence.

have allocated their own resources to the national poverty alleviation effort. health. It is envisaged that national implementation of CPAP over the next three to five years may involve 300bilian Yuan according to a informal source from the LGOP to support village poverty reduction. infrastructure. and (iii) make in-roads on the incidence of absolute poverty in rural China. The management system that the LGOP has in place is focused on the flow of money in a manner consistent with a system that has treated hard core poverty as a welfare problem. 72 In summary. education. their best efforts notwithstanding. the motivation for CPAP arises because key policy makers in China have recognized that there is a need to: (i) redress deteriorating inequality in China. Hence. a good and effective working relationship between the LGOP. with proposed poverty reduction assistance informed by a willingness to listen to the poor and address the constraints that have prevented them from escaping poverty. agriculture.4 Monitoring Poverty Reduction 74 Current practices in poverty reduction monitoring in China are based on tangible output level and not directed at impact assessment (Li Xiaoyun 2001). 2001) poverty reduction funds from Beijing. all key ministries –finance. Consider the contrast between Diagrams 1 and 2. Li Zhou (2001) estimates that in 2000 the financial contribution made by cooperating ministries accounted for 30% of all official funding for poverty alleviation in China. which in that year exceeded ¥9 billion.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. Diagram 1. development planning and statistics.1: Trickle-down poverty planning Trickle-down poverty planning LGOP Poverty Reduction Provincial Government Office for Economic County Township and County & Township Infrastructure and In-line Agency Poor Villages 23 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. 73 CPAP seeks to achieve these objectives by focusing national poverty policy directly at village poverty. the ABC and the SDPC will be essential. (ii) stem the leakage of poverty funds to inappropriate beneficiaries. 1.2001 . the MoF.

If data is collected. finance. Diagram 1. There may also be some spin-off benefits from infrastructure development. 2001) 75 In Diagram 1. This will be a challenge to the LGOP. The focus of top-down planning has been provincial economic growth through picking what seemed to be income and employment generation opportunities. who does not and which initiatives contributed most effectively to change in the incidence of poverty. it is related to the grouping of village households according to monthly income levels. The CPAP framework is built around a participatory development planning paradigm that requires participatory M&E. In this process. health. The work program of in-line agencies is not poverty focused. etc. the village is a minor player. which has only limited experience and capacity to facilitate and coordinate participatory M&E at village level.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. the monitoring systems of the LGOP are concentrated on the paper trail documenting the distribution of relief payments to the poor. education.2001 . even though there are regular contacts between village committee members and staff of the ministries of agriculture. Statistics collected for monitoring purposes concentrate on documentation rather than impact assessment or discrimination between who benefits. This fact presents donors and NGOs with an opportunity to make a significant contribution to the success of CPAP by assisting the LGOP to improve its capacity to implement and manage a national participatory M&E system. households without an adequate supply of grain.1. households without access to adequate labour for household survival. What little trickles down from above is some employment opportunities and welfare transfers for the destitute and those hit by natural disasters. especially through TVEs. or households burdened with disabled members. Little or no attention was given to following the impact of investments at village level that lift the productivity of village households. but little else. but these are serendipitous and rarely deliberate.2: Bottom-up participatory poverty planning Trickle-up poverty planning LGOP Poverty Reduction County Poverty Alleviation Office County Township and Outside Technical Assistance County Planning Commission County and Township Infrastructure and Village Poverty Reduction 24 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.

(ii) the per person productivity of household livelihood activities.2 represents an idealized schematic representation of what a shift to a participatory village poverty reduction planning process implies. At its core this means that there will be far more attention given to the factors that will ensure that village poverty reduction is sustained. plus expenditures on activities identified by the VPRG that are intended to increase the absolute level of productivity of village household livelihood activities. The links that appear are those that represent cash flows into poor villages for employment creation.2001 . but these should improve as CPAP experiences spread their influence on thinking and conventional practices in development and poverty planning. and diversify the sources of village livelihood activities. (iii) changes in the absolute number of households and individuals in each functional poverty group in the village. but their administration is outside the CPAP process and continues to be the responsibility of the Village Committee. A link to outside technical assistance and research agencies represents the important place that problem resolution through technology transfer. 79 At the time of writing there are only limited signs that the system is gearing itself up for the bureaucratic changes that the adoption of CPAP on a national basis will bring. there is reason to be positive. The LGOP has also cooperated unreservedly in the initiation of a training of trainers program for CPAO staff and village leaders in the essential elements of the participatory methods used in CPAP. as they are not an investment in sustainable poverty reduction. The CPAO shares the center stage with the VPRG. in total and on a household basis.5 Principles of County Poverty Alleviation Planning (CPAP) 25 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. 1. 77 Procedures for monitoring the impact of CPAP must be designed to be consistent with the flows represented in Diagram 2. independent analysis and discussion with the VPRG to allow for any changes that experience shows is warranted to scheduled poverty reduction activities. The results are to be reported to the CPAO for recording. Gone is the concern to ensure that poverty relief transfers and welfare payments are made. In Diagram 2. The LGOP has embraced CPAP and has enthusiastically assisted in the field testing of component parts. (v) changes in the village weighted participatory poverty index (PPI) and its component parts. There are weak links at the beginning of the process to the CPC. These payments remain. Six key performance indicators (KPIs) will be given special attention: (i) Value of village output. 2001) 76 Diagram 1. However. and (vi) the level of participation by the poor. and technology development will play in assistance given to villagers to increase output in livelihood activities. (iv) the cash flow that is passing through village households from all sources. 78 Data on each of these six KPIs are to be collected by the VPRG on an on-going basis through regular consultation with village residents.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. technology adaptation. welfare payments do not appear.

and PM&E. This will involve innovations in procedure and institutional development at village and county levels that increase the avenues for involvement in village and county-level decision making by poor people. their understanding of the constraints that prevent them from escaping poverty. to be responsible for village-level participatory planning. and essential support services programmed from mainline agencies. education and health). but their success is dependent upon effective integration of these projects into County Development Plans as a matter of due process. 2001) 80 The State Council has determined that future poverty alleviation programming in China will be based on village poverty reduction planning. (e. but that implementation of the national policy will be facilitated at county level.g. As such.2001 . rigorous documentation.: seed and fertilizer suppliers) to ensure that they will be forthcoming in a timely manner and in sufficient quantity. and participatory solution design with poor villagers. and simple-to-use key performance indicators. Knowledge of this sort cannot be had without a strong commitment to participatory approaches to all steps in the project cycle and program processes. and public sector enterprises.g. (ii) Hard core poverty reduction must be planned so that the necessary resources are appropriately targeted at the poorest villages in each county. whether based on public sector-funded infrastructure upgrades or private sector-led production activities. Critical to this process is the choice of indicators to guide the selection of poor villages and planned interventions. In particular. Only if the recommendations of VPRGs are integrated into County development planning procedures will clear targets be set. extension. the methodology proposed must be user-friendly and easy to replicate across counties and provinces. participatory problem analysis. (v) Village poverty reduction plans will be based on recommendations arrived at through participatory approaches to project identification and design. the target beneficiaries. The needs of poor people. (e. 26 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. a methodology for which constitutes the primary focus of this report. and their appreciation of capacity to mobilize resources and manage projects are key inputs into the planning process. 81 There are eight propositions that constitute foundation stones for CPAP.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. must be integrated into these systems as part of policy implementation and governance reform.: agriculture. it will commission a Village Poverty Reduction Group (VPRG). These eight are: (i) Poverty reduction at village level needs investments supported by local policy and administrative changes that enable households to increase the productivity of their economic activities and their access to regular cash flow. project level design. Participatory approaches to poverty reduction interventions. Resource flows to poor villages must be closely targeted so as to minimize 'leakages' to the non-poor. (iv) CPAP must be systemically compatible with China's bureaucratic commitments to centralized accountability. (iii) Our understanding of the constraints that keep poor villages poor must be informed by participatory dialogue. This change will require the development of complementary village and county poverty alleviation planning procedures.

The level of self reliance can be measured in many ways. especially increased per capita cash flow into poor households. access to productive resources.1 Understanding Poverty: A Functional Poverty Pyramid 82 Poverty is both systemic and functional. but also to a reduction in the absolute number of dependent vulnerable poor. that dismiss the poor as without the skills and the capacity to contribute in a major way to the abolition of village poverty. human resource development opportunities. Participatory approaches to development attempt to redress the lack of respect that systemic poverty structures deny the poor as a group. On the vertical axis the pyramid shows average earnings per person in each strata of functional poverty. (viii) Poverty reduction involves the achievement of greater equity at village level. 2001) (vi) Progress in poverty reduction must be measured against improvements in the incidence of poverty at all functional levels of the poverty pyramid. (vii) Village poverty reduction should result in increased levels of self-reliance among households in poor villages. no matter how hard they work to escape their poverty. pro-self-help.2001 . the sources of these problems. but CPAP gives priority to the eight indicators that form the basis of the PPI. improved levels of village-based economic activities. even where this is only a part-time source of employment. On the horizontal axis the poverty pyramid shows the 27 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November.6 The Poverty Pyramid: A Structural and Philosophical Framework for CPAP 1. and a downward trend in dependence on public sector resource flows. and participation in decision making positions. a fall in the number of households at village level that live with food insecurity. in access to basic services. and inclusive of the poor in poverty reduction planning. as measured by the number of persons reliant on welfare for their survival. paid employment. attention is directed to how the poor earn their livelihoods. a decline in the number of children dropping out of school. income earning choices. At the systemic level. It is possible to view the vertical axis as showing the relative productivity of poor people by their primary source of livelihood. At the functional level.. deliberate attention is given to the problems that plague the livelihoods of the poor. By combining these two ways of looking at poverty. 83 A poverty pyramid illustrates how systemic and functional poverty is revealed at village level. self-employed poor and entrepreneurial poor. the absolute return to their work effort. Participatory poverty reduction planning also rejects the welfare handout approach to poverty alleviation. sources of financial intermediation.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. we construct a view of poverty and the opportunities to reduce poverty that is pro-poor. 1. and the constraints that keep these returns low. especially for poor women and ethnic minorities. This means that success in poverty reduction will not only lead to increased numbers of successful micro-entrepreneurs.6. subsistence poor. and the institutional constraints that keep poor people poor. wage-earning poor.

However. Because of the existence of the 5 guarantees program. new poverty reduction policy adopted by the State Council 28 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. and their average earnings per person. the disabled. typically because young children. 85 The poverty pyramid shown in Diagram 1. PRC. 3 person 45000 yuan 3500 yuan 2500 yuan 1500 yuan 800 yuan 58 person 1000 person 1200 person 20 person 600 person 1400 person 1900 person Entrepreneurial Villagers Self-employed Villagers Wage-earning Villagers Subsistence Farmer Vulnerable Villager 1750 person Males labor Females labor Diagram 1. separated by gender. and those with serious heath problems. old aged without work opportunities.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. supplemented by both local and central government funds where natural disasters or poverty mean that individual villages cannot afford to provide for the 5 guarantees from local household levies. A comparison of the average income earned per person in each stratum reveals the loss of productivity associated with being lower in the poverty pyramid. this group of poor villagers is not regarded as among the direct target beneficiaries of poverty reduction initiatives instigated by the LGOP network. 84 Diagram 1.2001 . In China the vulnerable poor usually make up a small proportion of the village. such as the disable and those recovering from injury. The numbers are taken from 9 villages in Fengning County. those whose movement is restricted. predominate among the poor villagers classed in this group.1 presents a gender sensitive functional view of the poverty pyramid. In China there is a program known as the five guarantees. Hebei Province.3 A functional Rural Poverty Pyramid for China Source: PRA data on Employment structure and average income of rural labour in Qibailong Township Dahua County Guangxi Zhuang autonomous Regions. which targets the disabled. In the course of a year. depending upon his or her primary source of livelihood at that time. whose main livelihood engagement and source of income is the primary livelihood function that applies to each stratum. the unemployed. The poor earn very little per person. where the methodology outlined in this paper for CPAP has been field tested. a villager can occupy a place in different levels of the poverty pyramid. The numbers refer to the distribution of the poor across each stratum in the poverty pyramid. the old aged.3 hypothesizes that the rural poor can be viewed as resting on a base made up of vulnerable poor whose poverty is characterized by their dependence on others for their survival. Finance for the 5 guarantees is raised by a village committee under a collective levy on each house. 2001) number of poor villagers.

if only in a minor way. such as farming. 91 Above the subsistence poor in the poverty pyramid are those households who 29 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. subsistence families often have above average ‘dependency ratios’. or households that need to be targeted if rural poverty is to be reduced. 89 It is often a surprise to find that the livelihood difficulties of Subsistence Poor households are exacerbated by a shortage of ‘economically active’ labor. skills and market opportunities that are available to village members. It is the task of the Village Poverty Reduction Group (VPRG). to identify and translate the opportunities for increasing the productivity of the vulnerable poor into project proposals that can be included in village poverty reduction plans. which increases their vulnerability and capacity to be self-reliant. The subsistence poor belong to households that in China are also know as “Pingkun Households”. especially into cash-cropping and other livelihood activities. 87 The next poorest group in the poverty pyramid. . In so doing. This group makes up a large proportion in almost all poor villages in China. This contribution can be improved. and how subsistence farmers can be aided to diversify their livelihood sources beyond subsistence farming. 88 Self-employed subsistence farmers realize a 'wage' that they pay themselves in the form of the products they produce and consume. 86 The vulnerable poor are not entirely helpless. is to improve. that realize a higher return to effort. 2001) formally declares the inclusion of this group in LGOP led poverty alleviation planning (PAP). to consult with the subsistence poor to identify why their productivity is so low and what might be done to improve it. Because subsistence farming is such an important source of livelihood in poor villages. 90 It is the task of the VPRG. the subsistence poor.2001 . (ie. because their productivity can be increased through CPAP procedures. therefore. CPAP directs that the VPRG to listen to the vulnerable poor and learn of the things that will make them less dependent through improved productivity and capacity to contribute to household sustainable livelihoods. describes those poor villagers who obtain their primary livelihood from subsistence activities. this group of poor are eligible direct beneficiaries. which they willingly take on whenever the opportunity arises. In CPAP.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. As a result. Typically the own-wage of poor subsistence farmers is below the wage earned as an unskilled employee doing itinerant day laboring. which it must be if the dependency-ratio in poor households. the proportion of household members unable to do regular work). one should expect that a village poverty reduction plan will devote considerable attention to how subsistence farming can be made more remunerative. including off-farm income earning opportunities. the VPRG will build on the assets. As a group they make a contribution to household livelihood. Economists call this an 'own-wage'.

Wage-earning poor households share with the subsistence poor the fact that their livelihoods are earned predominantly by selling their labor. (MED) programs and microfinance providers often target members of this stratum to encourage business expansion and employment generation. into this stratum and. contribute to the production process. 92 Even though the market determined unskilled wage rate is normally above the own-wage of subsistence livelihoods. in a participatory way with the self-employed. the one for an own-wage and the other for a market wage. though there are exceptions.. eventually. typically members of the wage-earning poor. In the main these persons remain poor because their involvement as entrepreneurs and employers is only a part-time activity. This latter group typically makes up the second largest group in the poor villages of China. The productivity of the self-employed poor is a function of all the factors that determine the value they can add to the raw materials they transform into products for sale to consumers. 94 The top stratum of the poverty pyramid comprises village poor people who are not only self-employed but also employ others. Nonetheless.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. their productivity. Microenterprise development. rather than the labor itself.2001 . The self-employed poor sell the fruits of their labor. the VPRG will explore with members of the wage-earning poor what might be done to increase the number of days of paid work available. especially among women who have limited opportunities for income generation and are prepared to work at handicrafts and other home-based employment at very low returns to effort. is enhanced by the fact that they benefit from the profits to be made when wages paid to employees are below the value-added that employees. to levels of income per person that are above 30 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. and it is these ideas that the VPRG must then incorporate into the village poverty reduction plan. how the wage earned can be increased. Even where wages appear to be relatively high. they target members of lower strata to enable individuals to migrate up the poverty pyramid. The realized wage of the self-employed poor is normally higher than that of the subsistence or wage-earning unskilled poor. (ie. Ideas on interventions designed to remove or at least relieve these constraints will arise from this investigation. 93 The stratum above the wage earning poor is occupied by the self-employed poor. the absence of on-going employment makes it difficult for the rural wage earning poor to achieve average income levels above the rural poverty line. the wage they earn from the profits they make). the absolute amount the wage earning poor receive in the course of a year is not enough to enable the household to rise out of poverty and sustain a livelihood above that level. or how the available days of underemployment might be gainfully exploited to achieve an improved standard of living. The wage-earning poor sell their labor to an employer instead of themselves. Alternatively. the problems they face that prevent them from gaining a greater return from their self-employment. It is the responsibility of the VPRG to examine. 2001) survive by selling their labour for wages. mostly on casual terms that occupy less than half the working days in any given year. possibly seasonal. Here again.

1994. to levels of livelihood well above the poverty line. 2001). has shown that extant practices give little effective attention to poverty targeting procedures that would remove constraints to greater self-reliance. and planning). recent research supported by DFID and the World Bank. It is needed because the top-down paternalistic traditions of past poverty policies in China have been locked into a process of poverty targeting that served best the transfer of funds instead of investment in poverty reduction. Nonetheless. Reorientation of national poverty policies towards a focus on functional poverty and improved livelihoods is needed in China. et al. CPAP seeks to redress these failings by employing a more functional approach to poverty targeting and public sector involvement in village poverty reduction. and the productivity improvement experienced by poor villagers. 95 Not all villagers in poor villages are poor. The CPAP approach defines for the public sector a role in village poverty reduction that is tied to specified poverty reduction targets. or the capacity of villagers to earn cash income. 98 The methodologies that make up CPAP leave to village people what can be left to them.. 1991.6. These links are strongest when there exists clear procedures for integrating these targets and associated activities into county level development planning. and growth in realized potential for self-help. as beneficiaries.2001 . 1992. the target of CPAP activity implementation is to maximize the involvement. However. or target village level activities designed to raise productivity of village livelihoods. on to poor Counties. 2001) the poverty line. CPAPl also nurtures sustained village poverty reduction by encouraging villagers to identify the constraints that prevent them from being more self-reliant and more productive in what they do to support themselves. the incidence of poverty notwithstanding. CPAP’s use of participatory approaches to poverty reduction planning is intended to promote migration up through the poverty pyramid and beyond. and only then to poor Villages and poor households.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. and 2000 for further details on the poverty pyramid and its use in poverty analysis. CPAP does not exclude these village members from the participatory village poverty reduction planning process. (See Remenyi. 1. 97 Current public sector poverty intervention in China gives great weight to ensuring that funds intended for poverty alleviation are properly transferred from the State Council through to poor Provinces. targeting.2 Some Key Performance Indicators 99 CPAP addresses the poverty pyramid by setting poverty reduction targets that 31 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. 96 The poverty pyramid is both a heuristic device for analyzing poverty and for reorienting poverty targeting along functional and systemic lines. (see Beynon. The near poor or the not-poor in a village are an important asset to village capacity for poverty reduction planning.

These two characteristics of chronic poverty are the outcomes of systemic poverty processes. while short-term interventions may be identified to increase productivity and cash flow in poor households.2001 . Success in poverty reduction will see the number of women in each stratum shift in ways that are indicative of movement up from lower to higher strata. 103 Further. Productivity trends will be shown by increases in the average contribution by women to household income. These problem trees can be superimposed onto the functional poverty pyramid to increase the heuristic value of the data collected for participatory solution analysis. Key performance indicators of progress in poverty reduction will include the number of females in each stratum. experience has also shown that poor villagers are concerned to ensure that their children will have better opportunities for work and lifestyle. These data about village poverty can be used by VPRGs to construct 'problem trees' that are basic inputs into a simple poverty reduction planning logical framework. 2001) reduce the absolute numbers of village people in any of these functional poverty strata. Participatory approaches to poverty problem analysis are fundamental to ensuring that village poverty planning does more than nod in these directions. The CPAP framework emphasizes the removal of major constraints that have thus far prevented poor households from escaping poverty.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. plus the average contribution that women make to household earnings. cause villagers to opt for resource allocations that have only limited immediate personal benefits. which will push more and more of the poverty pyramid upwards towards the poverty line and. to cloud the important role that wealth creation and 32 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. hopefully. above it. Productivity improvements are reflected in increasing earning capacity. 102 There is a gender component to each stratum of the poverty pyramid. therefore. participatory methods are the quickest and least expensive method of amassing details of the problems that poor households face and the constraints that prevent them from overcoming these problems. However. 100 Participatory methods are an especially appropriate method to use to characterize poor villages according to the number of poor people or households in each functional poverty category or stratum. 101 At root. the poverty pyramid that underlies the CPAP framework highlights low functional productivity and inadequate cash flow as the two key characteristics of hard-core-poverty. 104 The CPAP framework proposed accepts the widely held view that the persistence of hard-core-poverty is connected to resource access and wealth distribution issues. Similarly. Poor villagers know their village intimately and are readily able to classify their fellow village residents according to their main occupations and survival strategies. the philosophical framework for CPAP does not allow particular subjective attitudes to wealth redistribution or the need to redress gross inequities in income or economic opportunities. These longer-term commitments may.

health workers. a numeric gender sensitive summary of the functional poor in the poverty pyramid. If 33 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. problem-solution design. and shop keepers). 1. The methods used will be village group meetings. PPI. and representatives drawn from a cross-section of the functional poor. wealth creation will take the form of productive asset accumulation. implementation planning. which is composed of members drawn from among the existing Village Committee. Phase 2 –Village Poverty Reduction Planning 108 For each selected target village. when village poverty reduction proposals are vetted and integrated into the county's overall poverty alleviation development plan. for the assembly of baseline data on village poverty status and household poverty characteristics. which integrates three key dimensions of poverty using eight selected poverty indicators. Phase 1 –Identification of Poor Villages 107 Unique to the CPAP system is the calculation and use in phase 1 of a weighted Participatory Poverty Index. such as teachers. (next page) 106 There are three essential steps to CPAP: Phase 1: identification of poor villages. however. Where access to resources is indicated as a key strategy. (eg. In the main. teachers. in phase 2. and monitoring and evaluation.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. These data comprise the raw materials for the initial design of Poverty Reduction Proposals by the Village Poverty Reduction Group (VPRG). The weights applied to each indicator are determined by the target beneficiary poor householders in the course of the participatory problem analysis exercises conducted under the facilitation of the VPRG. with those villages with the highest PPI given priority. and an analysis of the poverty problems that exist in the village. Phase 2: village poverty reduction planning. the VPRG takes responsibility. village resource mapping and consultation with key members of the Village Reference Group (VRG). important service providers. a collection of village leaders. this factor should be addressed by the VPRG in whatever manner is appropriate. unless political criteria intervene to indicate otherwise. Target villages are selected using the PPI.6.3 Overview of the Procedural Framework 105 The procedures by which the foregoing poverty planning framework is to be implemented are summarized in Diagram 2. All three phases call for the employment of participatory methods of data collection. health workers and enterprise operators. and Phase 3: county integration. including more productive use of household savings. 2001) household capital accumulation must play in sustained poverty reduction and increased capacity for self-help.2001 . The results of these consultative exercises is a household typology.2. representatives from the major categories of functional poor and important village service providers.

Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB.4: Summary of CPAP 34 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. 2001) Indicator Development Village Data Collection Indicator Weights WPI Calculation Scoring Scheme Poverty Village Selection Village Data Collection Household Classification Map & Chart Baseline Data Poverty Analysis Need Identification SWOT & Feasibility Study Supporting Need Project Need Monitory Plan Need Integration County Socio-Economy National Goal & Policy Goal & Task Project Package Selection Supporting System County Project Village Project Implementation Plan Monitory System County Poverty Alleviation Diagram 1.2001 .

which is disbursed through 35 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. county officials and technical experts as appropriate could also be invited to be members of the VPRG. (SWOT) analysis. supporting loan for underdeveloped area development. including both multilateral and bilateral sources. Those proposals that are appraised as practical and achievable in the coming planning period have then to be integrated in the County Poverty Alleviation Development Plan (CPADP).Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. finalize village proposals into a simple logical framework format. education budget. (ii). and to detail the PM&E procedures to be used. can be determined. International donors. Weaknesses. and (iv). public sector funding for poverty reduction in China can be divided into three major categories (in order of magnitude of funds disbursed): (i). health budget. supporting loan for revolutionary bases. These latter three components make up the final 'project outcome' of the CPAP process. 2001) available. Financing CPAP 110 Sources of financial resources for poverty alleviation in China are of three main kinds: (i). Opportunities and Threats. possibly with the assistance of external consultants. so that the full extent of the claims on the county infrastructure budget. National and local government. all PAO approved village proposals are grouped into type. against resources available for CPAP in the County Development Plan (CDP). loan for TVE development and special loan for grassland poor county development. remote area and poor area. Economic Development Fund for Underdeveloped Area. which includes following items. What remains is agreement on CPAP implementation timetable and arrangements for participatory CPAP monitoring and evaluation procedures. etc. Phase 3 –Formulation of County Poverty Reduction Plans 109 It is in phase 3 that the village poverty reduction proposals are vetted by county officials from the County Poverty Alleviation Office. funded through the MoF but disbursed through the ABC. and village poverty reduction activities be scheduled. and locally expressed village poverty reduction targets or 'aspirations'. Relief funding from the Ministry of Civil Affaires. It is then the responsibility of the VPRG to subject their proposals to a Strengths. Only at this stage can project priorities be formulated. Private non-government organizations. 111 According to official classification of financial inputs to poverty alleviation. minority area.. (iii). Selection of which projects can and should be funded is then left to a process that matches politically determined poverty reduction goals at county level. In order to do this. the role of the county in the facilitation of village poverty reduction be finalized.2001 . Loan for Poverty Alleviation. to assess the resource needs of proposed poverty reduction interventions. special loan for poverty counties. (ii).

2001 . and others indicate that the food for work program has contributed significantly to the improvement of local infrastructure and short-term income earned by the poor. It has worked in close collaboration with the UN World Food Program since the beginning. and is likely to have excluded the poor by limiting access to loan funds to farmers able to offer the ABC acceptable financial instruments or assets as loan collateral. Studies by Lin and Zhongyi 1995. the GoC expended almost ¥41 billion on food for work projects. (Vide Fang 2000). that projects completed are typically bankable and replicable. The record also shows that the program has accumulated a bad debt rate that reached 40% by the end of the 1980s and has deteriorated further since then (ibid). with an estimated 15% of all households in the poor areas receiving a loan under the program. 112 It is the role of the LGOP to ensure that there is coordination across these expenditure areas and the responsible agencies. this gain has come at a very high cost because the bulk of the benefits may not have gone to assist genuinely poor households. and generally found that ‘the economic internal rate of return is significantly above the opportunity cost of capital in China. The MoF manages the fund. 114 China’s Food for Work Program was started in 1985.5 billion Yuan (LGOP 2000). and allocates budget to designated poor counties 36 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. total expenditure has reached to 264. and (iv). In keeping with the top-down nature of policy making practiced throughout most of China’s recent development history. The fund is funded and administered through the SDPC. The WFP has also undertaken a significant number of impact assessments of food for work in China. irrespective whether the farmer was located in an officially designated poor area or not. However. It is generally believed that the subsidised loan program has made a valuable contribution to improved farmer employment and income generation opportunities. LGOP data indicates that between 1991 and 2000 almost 74 billion yuan was disbursed through the subsidized loan program. In 2000. 115 The economic development fund for poor areas was started soon after the economic reforms of 1978 opened the economy of China to freer trade with the rest of the world. and that additional data provided from other projects confirms the positive findings ’(WFP 1997). The program has no effective mechanism for targeting the poor. 113 Total annual expenditure under these three headings have been expanded yearly. the Food for Work Program has been restricted to villages in officially designated poor counties.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. the subsidized loan program was not designed or implemented on the basis of consultation with intended beneficiaries. with WFP contributions accounting for approximately 30% of the value of food disbursed. which is 30 times than the figure of 1980. It has been planed to allocate total 300 billion Yuan after 2002 yearly (informal source of the LGOP 2002). The Food for Work Program has been developed to support the improvement of infrastructure in the poor areas. LGOP data shows that during the period 1991-2000. Where the subsidized loan program was supposed to be available to all poor farmers. 2001) the SDPC but funded via the MoF.

at least ¥15 billion has come from here. education and health. though it ought to be possible to ensure that repayment rates associated with CPAP based loan proposals are commercially sustainable. 2001) directly for improving physical and social infrastructure. potable water systems and road construction. Nonetheless.2001 . It can be tailored to fit the resource needs of projects initiated by the villagers through the poor village planning process. There appears to be no major barrier to this happening. It will fall to the LGOP and the State Council to facilitate the education process that this will entail. Similarly. A prerequisite. There is a need for the current financing mechanisms to be reformed. the poverty loan program could benefit household activities proposed under CPAP. There is anecdotal evidence that suggests that local government offices have very weak mechanisms for ensuring that funds allocated to poverty reduction do more than offer welfare relief. Increasing the transparency of how the fund is used and administered will be useful. This will be facilitated if proposals arising from the work of VPRGs are integrated into CDPs. such as communication. but in the pursuit of sustainable poverty reduction. However. LGOP data show that 1991-2000.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. health centers. The close tie that should exist to projects targeting poor households has been eroded with time. 116 An important source of poverty reduction funding is public sector resources not coming from central government budgets. Strengthening of the national auditing function will assist in ensuring that the goal of transparency is served. The LGOP estimates that since 1994. The preconditions for accessing a loan by a poor households should be flexible and eschew collateral requirements that exclude the poor. and problems of moral hazard are kept to a minimum. but involving the poor in the process is essential. 118 The Food for Work Program has a high relevance to CPAP. CPAP requires a complex of multi-agency cooperation and multiple sources of funding that could easily embrace all four of the sources identified above. First. over time the fund has largely become a source of subsiding funding for local government budgets. the directions of the reforms needed are much clearer. 117 From the foregoing it is not clear where resources can best be diverted from predecessor programs into CPAP. The government economic development fund can support the capacity building that this will involve. CPAP targets the functional poor. loan 37 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. with a view to transforming the poverty pyramid into communities that are successfully overcoming the constraints that keep them poor. a total of ¥22 billion has been disbursed through the economic development fund for poor areas. as a participatory process that engages different stakeholders to define what should be supported in a strategic manner. but the impact of these funds on the livelihoods of the poor is unclear. including infrastructure development such as schools. therefore. though it is the responsibility of the LGOP to detail what it will need to ensure that CPAP can be successfully implemented at local level. is that CPAP needs to be understood and accepted by all potential stakeholder agencies. Second. In the main these sources come from budget allocations by provincial ministries and in-line agencies. The notion that poverty reduction requires governments to invest in poor people and poor communities is still widely resisted.

While the LGOP has carriage for guidelines and policy definition. Above the LGOP but in partnership with it. Policy stakeholders. but neither should be insurmountable. there is the State Development Planning Commission and its national network of County Development Planning Commissions. design of poverty interventions. and monitoring of progress in trends in the incidence of poverty. the LGOP’s county counterparts. poor households in poor villages. The LGOP stands at the head of a nation wide network of county-level branches. The primary stakeholders. but they take their lead as service providers indirectly from the CPAO and the VPRG. The CPAO and the VPRG are responsible for mobilizing villagers. and poor villagers. It would be surprising if 38 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. The Policy Stakeholder group is led by the State Council of the People's Republic of China. CPAP Stakeholders 119 CPAP is both a concept and an operational tool. As such it will lead to new interactions between poverty sector stakeholders. NGOs. facilitating and scheduling CPAP activities.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. poor households in poor villages in poor counties. it is the county-level Poverty Alleviation Office and the Village Poverty Reduction Group that are the key members of this group. Over time one should see priorities in county development plans give greater weight to poverty reduction in the preparation of county development plans. 122 The second group of stakeholders in CPAP are those who can be identified as the Implementation Stakeholders. will find their role shifted to consider how they can best support local initiatives. possibly. The principles of financially viable microfinance are wholly consistent with the framework and the procedures associated with CPAP. but NGOs can be expected to take a keen and. CPAP must achieve closer collaboration between development planers. consultants and training providers are in a similar position as another class of service provider. The LGOP has the capacity and the authority to ensure that NGOs can participate as donors or on a partnership basis to ensure that private sector resources can be applied to poverty reduction through CPAP. contributing to development planning in China. will have much more voice in decision making. 2001) interest rate charges should be no less than the opportunity cost of funds. As this happens. in contrast. including development assistance agencies. 120 CPAP Stakeholders are of four basic sorts: 121 First there is the group termed Policy Stakeholders. a more altruistic interest. The in-line agencies and ministries are also members of the implementation group.2001 . This requirement will need an institutional change and a policy change. who must initiate CPAP and enable the process that will defer decision making authority to the target group. which implements policy directives received through the LGOP. known as the CPAO. The will of the State Council is translated into national policy guidelines and priorities by the Leading Group Office of Poverty Alleviation and Development . the range of policy level stakeholders will expand to include all ministries and finance agencies.

DFID. such as service providers and extant economic entities in the local economy. and CPAP is the participatory methodology on which implementaion in KWCs is based. 123 The third group of stakeholders in CPAP are the Target Beneficiary Stakeholders. 124 The fourth stakeholder group are those grouped under the Resource and Facilitator Stakeholder banner. and donors. CPAP provides opportunities for international communities to collaborate with China’s poverty alleviation program in ways that best suit the comparative advantages of development donor agencies as stakeholders in poverty reduction in China. the Resource and Facilitator Stakeholders will want to work with Policy Stakeholders and Target Beneficiary Stakeholders in ensuring that suitable PM&E systems are implemented. the needs of the landless and the constraints facing more entrepreneurial members of the village community are not overlooked. There are other beneficiaries too. Nonetheless. ADB and Other Donors’ Role in CPAP 125 Village poverty reduction has been adopted as the focus for China’s national poverty reduction policy. The LGOP must take the lead in this process. a schedule of national CPAP implementation workshops should be agreed upon. but it is direct beneficiaries that a stakeholder analysis needs to concentrate upon. 2001) there were no opportunities for NGOs with a commitment to participatory approaches to development to become involves as support agencies to the VPRG. but it must nurture closer working links between the LGOP. the following areas need further external support if CPAP is to be successfully adopted in all poor KWCs. The first of these 39 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. FF. Beyond that. ADB. development planning authorities such as the SDPC. In order to facilitate dialogue. each of which will focus on a key aspect of implementation that is giving rise to problems of a general nature. This group is dominated by ministries such as the MoF and the MoA. In many respects the target beneficiary stakeholder group can usefully be viewed according to the functional poverty level that individual members belong to. including NGOs. the MoF and the ABC. UNDP and WB have already had a hand in the development of the participatory approaches on which CPAP is founded.2001 . in-line agencies such as the LGOP and the ABC. The critical role for these stakeholders is resource mobilization to enable as many of the poverty reduction initiatives proposed by VPRGs to be resourced as possible. primarily poor villagers. the SDPC. the interests of children.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. This stakeholder group should be segmented to ensure that gender issue. CDPC. Ongoing stakeholder policy dialogue 126 Dialogue among different stakeholders is needed to ensure that the coordination and collaboration required to ensure that procedures can be enacted in a timely manner and brought to a fruitful conclusion is available. and SSB.

A key partner in capacity building should be the State College of Administration and Management (SCAM). PPR Capacity Building 127 There is an urgent need for National level capacity building on participatory planning and PM&E. especially within the SDPC. especially at county and township levels. all poverty counties now impelementing the CPAP. while the second might highlight the constraints to integration of VPRG recommendations into CDPs. MoF and the ABC. Gaps in PM&E 129 The M&E system associated with CPAP is not well developed. Currently there is no proposal to initiate a national capacity building program at this level. There is. but there is a need for a donor funded pilot program to develop a framework for local capacity building based on lessons learned in the course of CPAP field trials in poor villages. ADB should consult with LGOP and WB with a view to cooperating in the design and testing of a suitable PM&E system for CPAP. community development and poverty reduction planning at village or county levels are not the norm in China. Since the CPAP has been adopted by the LGOP. considerable scope for capacity building. there is a need of assessement on primary impact study to undersatnd how the CPAP is being undertaken to define what should be done for further intervention. The ADB and other donors should consider supporting a program to assess the capacity gap. and develop appropriate pilot activities. Local Level Capacity Building 128 Participatory approaches to local government. 2001) workshops could address outstanding issues relating to capacity building for participatory poverty reduction. develop a capacity building training module. It would not be inappropriate for donors to collaborate with the LGOP in the establishment of a CPAP Consultative Group.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. DFID is undertaking a study of local government capacity building for participatory development. The ADB and other donor stakeholders can support these workshops and assist in dealing with proposed follow-up activities.2001 . therefore. for example. to promote joint actions to document and disseminate lessons learned from experiences with CPAP. CPAP: A Methodology for Bottom up Planning 40 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. which has the mandate for training of high level officials and which would take the impact of training beyond the confines of the LGOP. Special attention should be given to the role that NGOs could play in ensuring that PM&E procedures are properly implemented and the results acted upon.

From the earliest years. 131 The thinking that underlies CPAP builds on the wealth of knowledge that poor villagers have on why they find it so difficult to escape their poverty. Rist 1997). CPAP. Nonetheless. Gansu. 134 The PPI is a key part of CPAP. and is not beyond the capacity of farmers and local officials to adopt. and Guangxi Zhuang Autonomous Region. Baldwin 1966. However.. that the poor are keen to escape from poverty.2001 . The methodology presented here. (Agarwala and Singh 1958. 133 CPAP is only now being implemented in a limited number of counties. Progress in spreading CPAP to other poor counties will be facilitated if well documented case studies were available for dissemination of key learning experiences. Meier and Seers 1984. 132 CPAP has been field-tested using participatory action research methods in Fengning County. CPAP begins from the premise that poor people are the true experts on poverty. These field tests demonstrated that CPAP is consistent with current poverty alleviation planning systems in China. does the exact opposite. especially in ways that will facilitate easy incorporation of CPAP outcomes into county. The LGOP will use the PPI to rank villages in KWCs according to the incidence of poverty.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. poverty reduction was not a central theme of development. Participatory approaches to poverty reduction planning offer means by which the desire of the poor to escape their poverty can be harnessed and the dream of escaping poverty brought to reality. immediately after Bretton Woods and the close of World War II. there will remain a need to apply the PPI to poor counties not included in the KWC list. 2001) 130 For too long the persistence of hard-core-poverty in China has been attributed by local officials to the 'poor quality of the people'. special attention will need to be given to capacity building in skills needed for participatory approaches to poor village community development. Subsequently CPAP was revised and the outcomes validated in Jingning County. especially if they are able to fund local technical agencies or NGOs to prepare and publish the case studies. regional and national development plans. Farmar 1988. There is a role here for donors such as the ADB. The history of ideas in 41 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. It would not be inappropriate for donors and private NGOs to work with local governments to see that this is done. Hebei Province. Lessons from International Experience 135 Poverty planning does not have an auspicious history in the modern period of economic development. and that the poor have the skills to escape poverty if given the opportunity. it was a by-product of successful economic development. The process that flows from listening to the poor capitalizes on the potential for poverty reduction that has remained unexplored because self-help strategies have been passed over in favor of welfare handouts and paternalistic judgments about what the poor need.

Poverty reduction planning was married to the establishment of complex manufacturing industries. history. 1975). politics. Streeton 1995 and World Bank 2001a). Singer 1975. engineering. Sen 1981. 137 Through most of the 1950s and the 1960s. Ravallion and Squire 1998. administration or any other aspect of technical assistance. and Singer 1993. Aghion. FAO 1996). progress in thinking on development planning. (Rostow 1960. 1980. anthropology. Rostow 1980. 1990). Kuznets 1971. the legendary PC Mahalanobis. Europe and Australasia from the mid 1950s through to the late 1970s or early 1980s. (Contrast Dreze and Sen 1990. Alderman 2001. institutional. Vito and Ke-young Chu 1998. Bhagwati and Chakravanty 1969. sociology. It went without saying that the achievement of modernity was also supposed to herald gains in poverty reduction that mirrored the full-employment conditions that appeared to characterize modern donor economies in north America. A modified form of Soviet style forced pace development represented the model that India and other technologically backward economies believed would propel them into modernity (Kumar 1957. Rather. Throughout the 1960s famines persisted and widespread incidence of deaths from starvation highlighted the fact that for many developing country citizens development planning was not delivering an improved quality of life or freedom from food insecurity. therefore. 1990 139 The failure of development planning to deliver reductions in the incidence of 42 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. Chenery and Syrquin. The idea that economic growth is a proxy for successful challenges to the incidence of poverty in poor economies still retains currency today! (Ravallion 1994. has been about the management of resources in circumstances of change. described by the head of India’s Planning Commission. Meier and Seers 1984). with the universally accepted dictum that successful development leads to economic growth that will be good for the poor as well as the rich. 1984. or environmental changes that development involves. 2001) development is not. 1993. the belief that economic growth is good for the poor remained as unassailable a proposition as ever (Streeton 1979. not a study of people mired in poverty (Ezekiel 1965. Bairoch 1975.2001 . Hirschman 1958. Tanzi. Bourguignon 2000. Temple 1999. geography. paved with ever improving theories of poverty or poverty reduction. However. as involving public sector support for producer goods industries to ensure that local economies develop the capacity to ‘make the machines that make the machines’ (Mahalanobis. Gupta 1971).Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. IFC 2000. 138 The development community was not long into the 1970s before concerns began to be expressed about the apparent absence of progress in developing countries. Bruno. World Bank 2001a. whether taken from the perspective of economics. 1963). World Bank. Lal and Myint 1989. 1975. Isbister 1991. and development investments associated with technology transfers (Agarwala and Singh 1958. Streeton 1979. poverty planning in developing countries took a back seat to sectoral modernization. Baldwin 1966. 1999. legal. Lal and Myint 1989. World Bank 1990. 136 Development studies has always acknowledged that there are winners and losers as a result of the socioeconomic. Fields 1980. Caroli and Garcia-Penalosa 1999.

It was then a much shorter intellectual step to ask how economic growth could be made more pro-poor. Van Den Berg 2001) 141 Throughout the 1980s. three decades of economic growth notwithstanding. therefore. Remenyi 1999). In fact. Development planners were again drawn to rethink why more progress was not being realized. development professionals found deficiencies in the technology transfer process. 1993. also forced development thinkers to re-examine why poor people do not have access to basic needs. Demery and Squire. 1999. but the time was not yet right for development planners to make the intellectual leap needed to realize the importance of disaggregating the concept of economic growth beyond the traditional approach of economics to the problem of distribution (Chenery and Syrquin 1975. Londonio and Szekely 2000. A lifeline was discovered in the view that development had to be ‘humanized’. which was long overdue but essential to the development of the concept of pro-poor growth. 1996. Tribe 1994. Easterly 2001. Streeton 1995. Nonetheless. Schafft. was to highlight the systemic basis of chronic poverty (De Janvry and Sadoulet 2000. The basic needs thesis. Rademacher. 2000. Lustig. Chenery et al 1974 FAO 1996. there was a great deal of truth to the realization that technology transfer was not a simple matter of choosing from a shelf of existing knowledge. and 43 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. Dollar and Kraay. Nonetheless. while the gap between the rich and poor was increasing. 140 There is considerable debate over the long term benefits of the greed revolution and its impact on poverty. the number of poor in the developing world was not falling. Suffice it to say that lower food prices and increased availability of basic staples meant that rice bowls once empty were no longer so by the time the 1970s drew to a close (Bairoch 1975. it was not until the mid to late 1990s that the concept of pro-poor growth was to attain widespread legitimacy (Sudhir and Ravallion. however. Herdt and Scobie 1988. Mellor 1995). Economists were aware that new thinking on distribution issues had to be a part of the solution. and Petesch.2001 . The core of the success of the green revolution technologies has been the applied and fundamental research that has adapted biological materials and rural production methods to the unique geographic and environmental situation of farmers in developing countries (Anderson. with the policy recommendation that more attention had to be given to policies that would ensure that the poor are given access to the basic needs that are essential for a person to be an active economic actor (Streeten 1979). 2001. ADB 1999. development planners were at a loss to know what more to do to ensure that concern for the poor is more than good sounding rhetoric. Mellor 1995). This is not the place to assess that debate or review the relevant literature (Hazel and Ramasamy 1991. Instead. The time was not yet ripe.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. best understood as the catapult from which the green revolution was launched (Hopper 1965). Chambers. 2000). Fishlow 1995. This re-examination. 2001) poverty and deaths from starvation was not attributed to deficient thinking about the role of economic growth in poverty reduction planning. Narayan. Narayan Patel. Shah. which in one sense represented a backward step in development planning to the extent that it spread the notion that the poor need welfare to ensure that they have access to the essentials of life. for entrenched thinking to seriously question the link between economic growth and poverty reduction.

Aghion. therefore. Poverty targeting has. 2001) Koch-Schulte. was the coming to a head of the debt crisis in developing countries. the costs of policy reform would be shifted onto those groups in the community with the least political power. where practicable. in the solutions proposed participatory methods in the design. b). Dorosh. Dayton. A global lobby of NGOs and developing country governments brought pressure onto the IMF and the WB to re-examine the impact of structural adjustment programs on poverty in highly indebted poor countries. The IMF led Washington consensus had imposed structural adjustment programs on some of the world’s poorest and most heavily indebted countries in ways that reflected a very naive view of the link between economic growth and poverty (Bourguignon. Pro-poor economic growth reflects a belief that poverty reduction will not follow economic growth unaided. This framework consists of twelve ‘guidelines’ for the planning. Soubbotina. The results showed that without deliberate attention to the needs of the poor. if at all. monitoring and final impact assessment procedures recommended. has resulted in a new agreement that constitutes a framework for achieving pro-poor economic growth. Economic growth remains at the center of contemporary thinking. typically the poor (Ravallion and Squire 1998.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. 142 An important step toward the elevation of pro-poor strategies into the center stage of development planning and poverty reduction planning in particular. design and implementation of pro-poor sources of economic growth. Caroli and Garcia-Penalosa 1999. International experience with pro-poor poverty reduction planning. 2000. Vito and Ke-young Chu 1998. Demery and Mehra 1999. these twelve pro-poor poverty reduction planning guidelines are: 1. Tanzi. unless deliberate steps are take to ensure that economic growth and the economic development that follows is pro-poor. but the link between economic growth and poverty reduction has been seriously reassessed.2001 . Poverty planning should be informed by participatory poverty analysis and incorporate. implementation. social and cultural constraints form systemic barriers that favour the non-poor in competition for resources. It also acknowledges that economic growth will benefit the poor minimally. Temple 1999. Bourguignon 2000) 143 The foregoing paragraphs present a highly truncated overview of how thinking in the the development community has arrived at a current consensus on development planning and strategies for poverty reduction. employment opportunities. In priority order. 2000. taken center stage in poverty reduction planning. which includes the welter of evidence now available in the many country specific poverty reduction strategy papers produced in association with the IMF. Agenor 2000. government assistance and access to markets. IDA and the WB (eg: IMF 2001a. 144 The goal of poverty reduction planning is to ensure that economic growth is pro-poor. and Younger 1997). The pro-poor consensus recognizes that powerful structural. Morley 1995. institutional. Eastwood and Lipton 2001). Sahn. 44 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. de Melo and Suwa 1991. Castro-Leal.

CPAP is another example of a strategy designed to achieve this outcome. The outcomes of poverty planning must enhance the capacity of the poor to become more self-reliant if they are to climb above the poverty line and stay above it. 145 The ADB has been in the vanguard of the search for strategies that would ensure that development planning will result in economic growth that is pro-poor. Poverty planning must nurture an environment in which poor households are able to participate in wealth creation activities through improved resource management. and/or increased opportunities for investment in self-improvement. ADB’s involvement in this process is to be commended as an appropriate and timely response to the requests and needs of China in poverty reduction planning at this crucial time of major policy reform in national poverty policy. Poverty planning must be explicit and deliberate in its targeting of the poor. Poverty planning must give explicit attention to the role of health issues as a cause of on-going poverty. 5. 8. Poverty planning must address the systemic and resource constraints that prevent poor people from escaping poverty through their own efforts. Poverty planning must address each of the major types of poverty that poor people identify as critical to their experience of poverty. 45 ADB/TA3610-PRC: Preparing a Methodology for Development Planning in Poverty Alleviation under the New Poverty Strategy of PRC/Final Report/November. Poverty planning must be inclusive and not ignore the needs of the vulnerable and powerless. 7. 9.Principles and Philosophy Underlying County Poverty Alleviation Planning (CPAP) by Asian Development Bank ( ADB. the mobile aged and children. 11. 4. 2001) 2.2001 . access to additional resources. Poverty planning must be gender sensitive and make explicit provision for the active involvement of women. Poverty planning must pay especially attention to increasing the flow of cash receipts into poor households. Poverty planning must address the need to raise the productivity of the functional poor at all levels of the poverty pyramid if sustainable poverty reduction is to be achieved. 3. 6. Poverty planning must embrace pricing strategies that are consistent with opportunity costs faced by the relevant target population. 12. 10.

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