A MEASURED APPROACH TO

ENDING POVERTY
 OUTLINE

1. Defining Poverty
a. Historical Overview
b. Measuring Poverty

2. Overview of Poverty
a. Global Overview
b. MDGs & SDGs
 OUTLINE

3. Poverty in Pakistan
a. Statistical/Institutional Overview
b. Policies/Strategies

4. Social Protection
a. Role of Social Safety Nets
b. Benazir Income Support Program(BISP)
5. Conclusion
WHAT IS POVERTY?

Some of the signs that might alert about the presence of poverty
…

Poor education Low status

Vulnerability
Inadequate nourishment
Inadequate clothing
Lack of power
…and defining poverty Poor health
No access to clean
drinking water Insufficient food

Poor sanitation Poor housing

Unemployment
 HISTORICAL OVERVIEW

 1901, Rowntree’s study- first to develop a poverty standard

for individual families
 1960s, the main focus was on the level of income (Gross
National Product per head)
 1965, idea of Relative Poverty, Rose Friedman work, John
Kenneth Galbraith
 1969, emphasis was on growth( Pearson Commission Report)
 1970s, Emphasis was on relative deprivation
- Work by Runciman and Townsend
- MacNamara’s celebrated Speech(WB President)
- Publication of Redistribution with Growth
- ILO’s pioneering work
 CONTD----
 1980s (New layers of complexity were added)
- Robert Chamber’s work
- Brundtland’s Commission Report
- Theoretical work by Amartya Sen
- Rapid increase in the study of gender(Feminization
of Poverty)
 1990s
- The idea of well-being came to act as a metaphor for
absence of poverty
- The idea of human development(inspired by Sen
and Mahbub-ul-Haq
- Concept of Social Exclusion
- Copenhagen Declaration on Social Development
 FOUR CLUSTERS OF MEANING

 The first is income-poverty or its common proxy

(because less unreliable to measure) consumption-
poverty
 The second cluster of meanings is material lack or
want
 A third cluster of meanings derives from Amartya
Sen, and is expressed as capability deprivation
 A fourth cluster takes a yet more broadly multi-
dimensional view of deprivation
(UNDP-Poverty in Focus 2014)
 DEFINING POVERTY

“Poverty has many faces. It is much more than low

income. It also reflects poor health and education,
deprivation in knowledge and communication, inability
to exercise human and political rights and absence of
dignity, confidence and self-respect” [UNDP, Human
Development Report, 1997].
MEASURING POVERTY
 POVERTY LINES

 First developed by World Bank researchers working

on the 1990 World Development Report (WDR)
 Used Purchasing Power Parity (PPP) exchange rates,
“dollar a day line.”
 “Poverty lines vary in time and place, and each
country uses lines which are appropriate to its level of
development, societal norms and values”

(Poverty Analysis Overview-WB 2010)

HOW IS POVERTY MEASURED?

Absolute poverty is measured by comparing a person’s total income

against the total cost of a specific ‘basket’ of essential goods and services.
People with inadequate income to purchase this basket of items are
considered to be living in absolute poverty.

Relative poverty compares a person’s total income and spending

patterns with those of the general population. People with lower income
who spend a larger portion of their income on a basket of goods and
services, compared with a threshold typical of the general population, are
considered to be living in relative poverty.
(Source: http://canadianeconomy.gc.ca)
ABSOLUTE
POVERTY • Lack of basic human needs
LINE

• Condition of having fewer

RELATIVE resources or lesser income
POVERTY compared to others
LINE
 INDICATORS OF POVERTY &
HUNGER
Absolute poverty is stated to be the absence of any
two of the following eight basic needs:
 Food
 Safe drinking water
 Sanitation facilities
 Health
 Shelter
 Education
 Information
 Access to services
MEASURING RELATIVE POVERTY

It can include lack of:

 Educational opportunity
 Material possessions
 Health care
 Good quality housing
 Civil Rights
 Social opportunity
 HUMAN DEVELOPMENT
INDEX(HDI)

 A composite statistics of life expectancy, education

and income per capita( developed and launched in
1990s)
 HDI ranks 188 countries(2015)
 Inequality Adjusted Human Development Index
(IHDI)
 IHDI is calculated for 151 countries(2015)
MULTIDIMENSIONAL POVERTY
INDEX (MPI)

 Multidimensional Poverty Index (MPI), published for

the first time in the 2010 Report
 Complements monetary measures of poverty by
considering overlapping deprivations suffered by
people at the same time
 The index identifies deprivations across the same
three dimensions as the HDI and shows the number
of people who are multi-dimensionally poor
Source: UNDP 2010
POVERTY GLOBAL OVERVIEW
BASIC FACTS ABOUT POVERTY

 About 896 million people in developing countries live on $1.90 a

day or less
 60 percent of the world’s hungry are women(the Hunger
Project, 2016 )
 70 percent of the world’s poorest people live in rural areas and
depend on agriculture and related activities for their livelihood
 The overwhelming majority of people living on less than $1.90 a
day belong to two regions: Southern Asia and sub-Saharan Africa
(UN,2016)
 High poverty rates are often found in small, fragile and conflict-
affected countries (UN,2016)
BASIC FACTS ABOUT POVERTY

 663 million people lack access to clean water.

 2.4 billion people do not have adequate sanitation
 1 out of 6 infants are born with a low birth weight in
developing countries.( The Hunger Project, 2016)
 While poverty rates have declined in all regions,
progress has been uneven: The reduction in extreme
poverty between 2012 and 2013 was mainly driven by
East Asia and Pacific (71 million fewer poor) –notably
China  
 (World Bank, 2014)
BASIC FACTS ABOUT POVERTY

 Wealth of the poorest half of the world’s

population has fallen by a trillion dollars since
2010, a drop of 38 percent
 Wealth of the richest 62 has increased by
more than half a trillion dollars to $1.76tr
 1% own more than the rest of us

Source: (Oxfam, 2016)

 MILLENNIUM DEVELOPMENT
GOALS(MDGs)

 The reduction of extreme poverty and hunger was

the first Millennium Development Goal (MDG1),
 Overall, there has been significant progress
towards reducing extreme poverty, with the MDG
1 target of reducing extreme poverty rates by half,
met "five years ahead of the 2015 deadline…
 700 million fewer people lived in conditions of
extreme poverty in 2010 than in 1990
 POST-2015 DEVELOPMENT AGENDA

 The HLP report, entitled: A New Global

Partnership: Eradicate Poverty and Transform
Economies Through Sustainable Development
(published in May 2013)
 “New development agenda must be guided by
the vision of eradicating extreme poverty once
and for all, in the context of sustainable
development”
 SUSTAINABLE DEVELOPMENT
GOALS(SDGs)

 Transforming our world: the 2030 Agenda for

Sustainable Development- an intergovernmental set
of aspirations/Goals
 Outlining the 17 Sustainable Development Goals and
its associated 169 targets
 To "end poverty in all its forms everywhere" is the
first sustainable development goal(Five targets)
 SDGs AND SOCIAL PROTECTION

 Give primacy to the concept of social protection

 Central to ending poverty and boosting shared
prosperity
 ‘Integrated set of policies designed to ensure income
security and support to all people across the life cycle
– paying particular attention to the poor and the
vulnerable’
PAKISTAN: POVERTY
PROFILE
 PAKISTAN COUNTRY REPORT (2016)-OXFORD
POVERTY AND HUMAN DEVELOPMENT INITIATIVE
 INTER-PROVINCIAL DISPARITIES IN
POVERTY 

 MPI also identifies the inter-provincial differences in poverty
 Balochistan continues to be the most deprived province in
Pakistan, where more than 70 per cent of the population is
deemed poor
 MPI identifies over 53 per cent of the population to be poor
in Sindh
 ABSOLUTE poverty in rural areas has reduced
 Gains made in poverty reduction are fragile
PAKISTAN COUNTRY REPORT (2016)
 PAKISTAN-HDI RANKING

 Pakistan’s ranking in Human Development

Indices (HDI) remained mostly unchanged as
the country clinched 147th position in 2015 out
of total 188 countries
 The country is falling into the list of bottom
countries in terms of HDI

Source: (UNDP-2015)
CAUSES OF POVERTY IN
PAKISTAN
 LOW AGRICULTURAL
PRODUCTIVITY
Out of the country’s 200 m population(estimated), 61.2
pc of the people are living in rural areas, and a majority
of them are employed in the agriculture sector

 Half of the employed labor force is associated with

agriculture sector(Bureau of Statistics-2016)

Farming contributes only 20.9 pc to the GDP. This

implies a very low agricultural productivity, which is one
of the factors contributing to rural poverty

(World Bank Report 2014-15)

 POPULATION GROWTH
 At Pakistan’s birth, the then West Pakistan had
around 50 million people
 Today, we number around 200 million(estimated)
 Population continues to grow at around 2.10% pc
 Pakistan is among six of the 10 largest countries in the
world whose population has been projected to
exceed 300 million by 2050

Source: World Population Prospects 2015 (UN)

 EDUCATION
 Net enrollment rate in Pakistan is only 56pc, compared
to 90pc in India, and 93pc in Bangladesh and Malaysia
 Pakistan spends only 2.2 pc of its GDP on education,
compared to 4pc in India, 2.5pc in Bangladesh and 8pc
in Malaysia
 Furthermore, the youth literacy rate in the country is
the lowest among SAARC countries
 The number of out-of-school children in Pakistan is the
2nd highest in the world.

(World Bank Report 2014)

 GENDER INEQUALITY
 Ranked 144 out of 145 countries in 2015(Global Gender
Gap Index )
 Women’s literacy rate in 2015 was only 49% (70% for
males)- PSLM
 Pakistan ranks last in women participation in the work
force among (SAARC) countries , Oxfam study:
(March 2015)
 67.8% of the male population is in the labor force,
whereas only 22 % of women are employed (33% in
India and 58% in Bangladesh)
(Labour Force Survey 2014-15)
 TAX STRUCTURE

 Widespread tax evasion and avoidance

 Inequitable Tax burden due to tax exemptions and
concessions
 Low-income earners pay more in taxes on purchases
of commodities as a ratio of their income as
compared to the rich people

(World Bank Report 2014)

 UNEMPLOYMENT

 It is estimated that there are 106 million people in the

working age cohort in the country

 From 1985 to 2013, the average unemployment rate

was around 5.4 percent

 Current Unemployment rate is 5.9 pc with strong

indications it will rise steeply
Source: (Bureau of Statistics/ Pakistan Economic
Survey)
 LAW & ORDER

 Rising militancy during the last few years has adversely

affected investment prospects , and there has been decline
in Foreign Direct Investment(FDI)

 Limited government capacity to spend on pro-poor

expenditures due to a massive spending on anti-terrorism
campaign during the last few years

37
 NATURAL DISASTERS

Types of Disaster Population Affected

Flood 2014 2,530,000
Drought Thar Parkar 2014 200,000
Earthquake Awaran 2013 322,000
Flood 2013 1,489,000
Flood 2012 4,849,000
Flood 2011 8,920,000
Flood 2010 18,000,000
Attabad Lake Crieses 2010 20,000
Earthquake 2008 60,000
Cyclone Yemyen 2007 2,500,000
Earthquake 2005 3,300,000
Drought in Balochistan 2000 1,200,000
Total 43,390,000
Source: NDMA & ERRA
POVERTY REDUCTION
POLICY/STRATIGIES IN
PAKISTAN
 Poverty Reduction Strategy
Papers (PRSP)
 First developed in 1999, initiated by the IMF and the World
Bank after widespread failures of the structural adjustment
programs they had developed for various countries in the
1990s
 Pakistan adopted the process in 2000 by setting up a PRSP
Secretariat in the Finance Division
 An Interim Poverty Reduction Strategy Paper (I-PRSP) was
developed for 2001-2003

Source : http://www.finance.gov.pk
 CONTD---

 Pakistan’s first formal PRSP (PRSP-I), was completed

in December 2003 meant to be implemented over the
2004-2006 period
 PRSP-II was implemented over the period 2008-2010
 17 pro-poor sectors were prioritized through the
Medium Term Expenditure Framework (MTEF)

 Source : http://www.finance.gov.pk
 MTDF- 2005-2010

 Poverty reduction was an encompassing objective of

MTDF 2005-10
- Establish a just and sustainable economic system for
reducing poverty and achieving MDGs
- Protect the right to development of every citizen
particularly those of children, youth, women and
minorities
- Ensure equitable development of regions

Source: http://www.pc.gov.pk/
 VISION 2025

 People First: Developing social and human capital and

empowering women
- (MDG1), poverty eradication, (MDGs 2, 4, 5, and 6),
access to health and education services and gender
empowerment
- SDGs 1 (poverty), 3, (health) 4 (education), and 5
(gender)

Source: http://www.pc.gov.pk
 SOCIAL PROTECTION
STRATEGY(2007)
 Conceived within the overall framework of “Just and
Balanced Development” envisaged in the Medium
Term Development Framework (2005-10)
 Overarching vision of this strategy was to ‘develop an
integrated and comprehensive social protection
system, covering all of the population, but especially
the poorest and most vulnerable groups’
NATIONAL SOCIAL PROTECTION
POLICY FRAMEWORK
 To identify institutional roles and responsibilities with
respect to social protection

 To provide an overall vision, mission, objectives and

guiding principles

 To achieve consensus at the national level on the

definition of social protection, identifying target
groups, maintaining a national data repository,
financing formulas and agreed upon set of monitoring
and evaluation indicators
 ERADICATING POVERTY- SOCIAL
PROTECTION/SOCIAL SAFETY NETS
 DEFINING SOCIAL PROTECTION

 Relatively recent addition to the development policy

agenda
 All definitions of Social Protection share a focus on :
a) Managing risk
b) Assisting poor people
c) ‘Rights’ dimension(universal inclusion of all people
within a certain category as eligible for social
protection)
DEFINING SOCIAL PROTECTION( CONTD)

 Social protection describes all initiatives that:

a) Provide income (cash) or consumption (food) transfers to
the poor
b) Protect the vulnerable against livelihood risks
c) Enhance the social status and rights of the excluded and
marginalized

(Devereux and Sabates-Wheeler: 2004 )

Source: Social Protection for Food Security, Report by the High

Level Panel of Experts- June,2012
 A WORKING DEFINITION OF SOCIAL
PROTECTION(2007)

 “The provision of support to individuals and households

through public and collective measures, to guarantee a socially
acceptable standard of living; and to protect them against low
or declining living standards caused by exposure to structural
vulnerabilities and/or market-related or contingent risks”.-

 Source: Conceptualizing a Social Protection Framework for

Pakistan-ADB(2005)
A WORKING DEFINITION OF SOCIAL
PROTECTION

 “Social Protection for Pakistan is a set of policies and

program interventions that address poverty and
vulnerability by contributing to raising the living
standard of poor households, mitigating the risks of
income variance of all households, ensuring equitable
access to basic services and protecting the rights of
the vulnerable and the marginalized”.

Source: Planning Division

 SOCIAL PROTECTION AT A GLANCE
Risk management
Crop and livestock insurance
Index-based weather insurance
Income, consumption

Grain reserves/Precautionary savings

Contributory social insurance
Income diversification

Income gains
Safety ropes
Risk reduction
Food price stabilization
Poverty line National grain reserves
Trade policies

Income generation
Social assistance
Asset creation
Cash transfers
Human capital formation
Food subsidies
Employment opportunities
School feeding
Access to land
Supplementary feeding
Input subsidies
Access to services (health)
Scalable safety nets
Right to food approach
Twin-track approach
Conditional cash transfers
Productive safety nets
Public works programmes
Destitution
Poverty traps

Source: Social Protection for Food Security,Report by the High

Level Panel of Experts- June,2012
 SOCIAL PROTECTION AND CONSTITUTION OF PAKISTAN

 Pakistan is one of the few developing countries whose constitution

guarantees the social security of its citizens. Clauses (c) and (d) of
Article 38 on the ‘Promotion of social and economic wellbeing of the
people’ stipulate:
 “The state shall: provide for all persons employed in the service of
Pakistan or otherwise, social security by compulsory social insurance
or other means; and provide basic necessities of life, such as food,
clothing, housing, education and medical relief, for all such citizens,
irrespective of sex, caste, creed or race, as are permanently or
temporarily unable to earn their livelihood on account of infirmity,
sickness or unemployment” [Constitution of Pakistan ]
SOCIAL PROTECTION(GOVT OF PUNJAB)

 ‘All public and private initiatives that provide income

or consumption transfers to the poor, protect the
vulnerable against livelihood risks, and enhance the
social status and rights of the marginalized with the
overall objective of reducing the economic and social
vulnerability of poor, vulnerable and marginalized
groups’
Source: Punjab Social Protection Act, 2015
SOCIAL PROTECTION(GOVT OF KPK)

‘A system that besides providing essential guarantees

to citizens - health care, livelihoods, children’s
education, employment, and environmental and
natural hazards, is also capable of protecting others
from falling into poverty and vulnerable situations,
and in phases, builds higher levels of protections
through mandatory and voluntary social insurance’
Source: Khyber Pakhtunkhwa Social Protection Policy. Social Protection Reform
Unit. Planning and Development Department(2014 )
 SOCIAL SAFETY NETS

 Social safety net is a term used to describe a

collection of services provided by the state or other
institutions to prevent individuals from falling
into poverty beyond a certain level

 Social safety nets are programs that help the poorest

and most vulnerable people stay out of extreme
poverty
 SOCIAL SAFETY NETS-AN
OVERVIEW

 1.9 billion people in 136 countries benefit from social

safety net programs.
 Safety net programs help reduce the poverty gap by 15%.
 only 1/3 of the world's poor are covered by safety nets
program
 On average, developing countries spend 1.6 percent of
their GDP on social safety nets
Source: (WB -2015)
 SOCIAL SAFETY NETS-AN
OVERVIEW
Conditional cash transfers exist in the following
countries, among many others:
1. Oportunidades/ PROGRESSA in Mexico,
2. Bolsa Escola and Bolsa Familia in Brazil
3. Food for Education in Bangladesh
4. Program of Advancement through Health and
Education in Jamaica
SAFETY NET INITIATIVES IN
PAKISTAN
BISP
MICROFINCE
SOCIAL HEALTH
INSURANCE
SUBSIDIES ON Agricultural Inputs, Wheat
and Energy

PAKISTAN BAIT-
ZAKAT UL-MAAL
Workers Welfare Fund
EMPLOYEES OLD-AGE BENEFIT SCHEME
 BENAZIR INCOME SUPPORT PROGRAMME (BISP)

 BISP was launched in 2008 to provide cash assistance

to the identified vulnerable in order to smooth
consumption
 A response to existing mis-targetting in providing
assistance to the poor
 Unconditional cash transfer program (UCT) was
started as the core program, built on a registry of
eligible families.
 OBJECTIVES OF BISP

 According to section 4 of the BISP Act 2010, following

are the objectives and purposes of the program

• Enhance financial capacity of the poor people and their dependent

family members,
• Formulate and implement comprehensive policies and targeted
programs for the uplift of underprivileged and vulnerable people;
• Reduce poverty and promote equitable distribution of wealth
especially for the low income groups
IMPROVED TARGETING-
POVERTY SCORECARD SURVEY(Proxy
Means Testing)

First time ever in Pakistan, a

Proxy Means Testing based
POVERTY SCORECARD SURVEY
was conducted in the entire
country to improve targeting
and have an objective
assessment of poverty
 

61
 CONTD---
 PMT provided data on key indicators that include
among others;
1. Household size
2. Type of housing and toilet facilities
3. Education
4. Child status
5. Household assets
6. Agricultural landholding
7. Livestock ownership
 FEATURES OF POVERTY SURVEY

 It creates a large and reliable national registry of the socio-

economic status of around 27 million households across Pakistan 

 It identified 7.7 million households who are living below cut-off

score of 16.17 

 The eligibility of the households qualifying for BISP was later

modified to include households with a score of up to 20 provided
they met additional criteria of vulnerability such as disability, old
age and a high dependency ratio in the household
 BISP OVERVIEW
Chair
perso
n
BOD
Secretary

Regional Offices (6)

Divisional Offices (35)

Sub-divisional Offices/Tehsil (359)

SEPARATION OF FUNCTIONS AT
BISP
Overall
Management &
Coordination
Poverty Survey Recipient
leading to the BISP Verification, Data
NSER Custodian

Survey Firms NADRA

Payment Instruments
and Disbursement

Banks
BDC is used at ATMS and retail outlets
 BISP
INITIATIVES
A Co-
Waseela
Responsibility
Low income families, Grant of -e-
Cash Transfer(Rs.
Rs.1500 every month Taleem
250/per child/per
month)

Waseela-e- Unconditional Waseela-

Health/Accident Sehat Cash e-Haq Interest free
Insurance Returnable
coverage Transfer(UCT) Financial
Waseel Assistance
a-e-
Budget
Rozgar Vocational/Skill Training
FY 2016-17
Rs .115
Billion
 BENEFICIARY DETAILS

Number of Beneficiaries in Millions

6 5.3
4.62 5.1
5
3.68 3.74
4
3.09
3 2.58
1.76
2
1
0

Source: BISP
 BISP – ROLE IN WOMEN
EMPOWERMENT

 Significant role in women empowerment as all

benefits are transferred to the family through
women

 The Program has given the women their identity by

requiring them to hold CNICs in order to be eligible
for the benefits under the program
 CHALLENGES FOR BISP

 Maintaining a dynamic database

 Post 18th Amendment Scenario and linkages with
Provincial governments
 Financial sustainability
 Role of Local Governments
 KEY MESSAGES
 Basic services for the poor
 Social Assistance
 Social Security/social safety nets/social
protection
 Labor Market Interventions
 Mitigation strategies for Natural & other
disasters
 Transformative Measures
 CONCLUSION

 Development Model- Based on

Participatory Approach
 Social Protection - A powerful
instrument of poverty reduction
 Poverty Eradication – A Complex
Challenge