Stories of positive action from around the world
Story numbers correspond to those in the Report.
Actions for fair financing
11.5: Debt relief and social spending
Nepal spends more on debt than education. It has only one teacher to every 180 children. Debt relief is likely to be delayed by conditions set by creditors. Chad spent US$ 66 million on debt service in 2006. It is one of the many countries charging some kind of fee for school. Only one third of girls in Chad go to school. Globally, another US$ 17 billion per year is needed to provide education for all girls and boys. In 2005, developing countries altogether spent 30 times this amount on servicing debt. The World Bank and IMF say that Kenya’s debt is ‘sustainable’ and it is therefore not eligible for debt relief. Kenya’s last two budgets allocated US$ 350 million more to paying debts than to education.
Over 1 million Kenyan children do not go to primary school. Repeated studies have shown the positive impact of debt relief on social services, most of them agreeing that education is the biggest winner. After receiving debt relief, Malawi, and Uganda, and United Republic of Tanzania all abolished primary school fees. This helped over 1 million more children into school in each country. Debt relief paid for training of 4000 teachers each year in Malawi, and salaries for 5000 community teachers in Mali. Source: Jubilee Debt Campaign, 2007
11.9: Enhancing the coherence of aid – shifting to general budget support
Traditional forms of international aid have flowed predominantly outside the formal budget processes of recipient countries. This means of delivery has been criticized for its negative impact on recipient government capacity to plan expenditure. Policy conditions and spending restrictions have further restricted the national policy space of recipient countries in taking action on the social determinants of health – in particular, for example, where aid is not allowed to flow to core institutional costs such as the public sector wage bill.
A key mechanism to finance and strengthen recipient countries’ capacity to plan cross-sectoral developmental action is the shift among donors to general budget support. Under general budget support, aid flows through government budgetary processes, enhancing recipient governments’ control over the development and enactment of policies that the aid is designed to finance. General budget support currently comprises a relatively small component of overall aid, but there are indications that it will increase. Source: GKN, 2007