as in real life: money matters, but it doesn’t buy you happiness carolina rentería lead...
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As in real life: money matters, but it doesn’t buy you happiness
Carolina RenteríaLead Economist, World Bank Group
Former Director of National Planning Department and Budget Director, Colombia
London - November 13, 2014
OVERSEAS DEVELOPMENT INSTITUTE - 2014 CAPE CONFERENCE
DOES MONEY MATTER? THE ROLE OF FINANCE IN ACHIEVING THE SUSTAINABLE DEVELOPMENT GOALS
6 points from Colombia1. MDGs: were just one element of Colombia’s
development strategy
2. Colombia formulated its own policies on how to
achieve the 2015 goals (Conpes #91)
3. Specific responsibilities were mainstreamed across
government
4. Financing was linked to strategies and MDGs: own
resources main source of financing
5. MDGs mainstreamed into National Strategies: share
significance with other priorities such as macro
stability, security, peace, competitiveness,
infrastructure …
6. Policies, quantitative targets and monitoring were
essential
Did it work? Is the homework finished?
One example: MDG2 - Achieving Universal Primary Education
(Time permitting)
Population: 48.3 million
Size: 1,1 million square Km
GDP: US$ 378 billion
2014 expected growth: 4.8%
Doing Business position: 34
Upper Middle Income
GNI per capita: US$ 7,560
Poverty rate: 32.7% (National Poverty Line)
(5% at $1.25 a day - 11.3% at $2 a day)
Inequality: Gini coefficient 0.54 (2012)
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
1. MDGs: were just one element of Colombia’s development strategy
• MDGs = one (of many) important inputs for the design of development and sector strategies, public policies, financing plans, allocation of resources and M&E frameworks.
• MDGs = a helpful instrument for defining priorities, setting goals, benchmarking Colombia vis a vis developing countries, assessing regional disparities, inviting private sector and NGOs into policy making and financing
• CONPES # 91 (March 2005): Targets and Strategies for achieving Colombia’s MDG in 2015
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
2. Colombia formulated its own policies to achieve MDGs (Conpes #91)
• MDG to be integrated into the National and Territorial Development Plans.
• Sectors to include the strategies and goals in their strategies and policies, priority setting exercises and to be measured on their targets evolution
• Financing is responsibility of National, Regional and Local Government with support from private sector, international agencies and civil society. Financing is only one relevant item …
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
3. Specific Responsibilities were mainstreamed across government
• Linked to a Ministry or Agencies• National targets were defined• Strategies and policies were defined or
modified• Baseline information was collected (gaps were
detected)• Indicators were developed• Financing needs and sources were identified
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
4. Crucially financing was linked to the MDGs
MDG 1 MDG 2 MDG 3-6 MDG 7 TOTAL
National Budget (NB) 3,669,210 1,654,463 3,247,326 1,498,964 10,069,964
Earmarked revenue (NB) 488,688 - 9,125,925 612,247 10,226,860
Decentralized Government resources 6,769,596 84,559 - - 6,769,596
Intergovernmental Transfers from NB to Subnational Govs - 7,696,664 31,473,915 6,271,934 45,442,512
Subnational Govenments own resources 2,055,871 628,627 2,160,103 2,330,215 7,174,816
Private Participation - 3,188,972 6,150 10,889,343 14,084,465
International Cooperation 481,900 3,250 - 12,176 497,327
TOTAL 13,465,266 13,256,536 46,013,419 21,614,879 94,350,099
Source: Conpes # 91, 2005
• Own public resources by far main source of financing. Includes taxes, debt:
internal, external (markets, multilateral loans).
• Given that education and health responsibilities are decentralized in Colombia, sub national Governments key players
• Private Sector plays a relevant financing role
• Very small reliance on international cooperation Really?
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
5. MDGs mainstreamed into National and Regional Strategies, Policies and financing
NDP 2006-10: DEVELOPMENT FOR ALL• Defense and Democratic Security• Poverty Reduction and promotion of equity
and employment• High and permanent economic growth:
base for equitable development• Sustainable Development• Better Service Delivery for Citizens
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
NDP 2010-14: PROSPERITY FOR ALL: • Regional development and convergence• Sustainable growth and competitiveness• Equality of Opportunities for Social
Prosperity• Consolidation of Peace
6. Quantitative targets and monitoring were essential
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
https://sinergia.dnp.gov.co
Did it work?
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
Source: Center for Global Development: Who Are the MDG Trailblazers? A New MDG Progress Index - Working Paper 222, August 2010. For each target, the Index compares a country's actual performance over time with the rate of improvement needed to reach the target by 2015 (8 highest score possible).
COLOMBIA
Is the homework finished? Just a few challenges ...
• 7th most unequal country in the World (2012 data)
• One of the countries in the world most affected by natural disasters (related and not related to
climate change)
• Large regional disparities and pockets of poverty (averages / per cap figures disguise)
• Second largest # of displaced people in the world (at least 5.7 million)
• Reintegration of paramilitaries and demobilized guerrilla
• Peace negotiations with FARC (oldest guerrilla in the world, 1/2 century of violence)
• Narcotrafic, BACRIM, homicides, kidnappings, terrorism
• Since 2006 we have been trying to link the savings in pension funds (US $80 billion) to the
financing of infrastructure needs, mainly roads .. No success yet ….
• ………
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
Happy Planet Index 2012: Colombia ranked # 3 (out of 151)
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
Colombia's HPI score reflects a relatively high life expectancy, relatively high levels of experienced well-being, and a moderate ecological footprint. - http://www.happyplanetindex.org/countries/colombia/#sthash.DgmFneIK.dpuf.: “The Happy Planet Index (HPI) is the leading global measure of sustainable well-being.”
COLOMBIA
An Example: MDG 2: Achieving universal primary education
1. To eradicate extreme poverty and hunger2. To achieve universal primary education3. To promote gender equality and empower women4. To reduce child mortality5. To improve maternal health6. To combat HIV/AIDS, malaria and other diseases7. To ensure environmental sustainability8. To develop a global partnership for development
National Planning Department (DNP)
Ministry of Education
Presidential Office for Gender Equality
Ministry of Social Protection
Ministry of Environment, Housing and Local DevelopmentPresidential Agency for International Cooperation
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
Indicators and targets
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
• Target 1: 100% coverage for basic education: pre-k + elementary (5th grade) + secondary (9th grade) and 93% for intermediate education (11th grade) Baseline 1992: 76.08% (basic) 59.11% (intermediate)
• Target 2 Illiteracy rate: 1% people between 15 and 24 years old. Baseline 1992: 3.77%
• Target 3: Reach an average of 10.63 years of education for population between 15 and 24 years Baseline 1992: 7 years
• Target 4: Reduce repetition to 2. 3% in basic and intermediate education Baseline 1992: 6.1%
Target 1 information
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
INDICATOR
DEFINITION
CALCULATION
MEASUREMENT UNITSPERIODICITYCOVERAGEDISAGGREGATION
INFORMATION SOURCE
NATIONAL GOVERNMENT ACTORS
TARGET 1
Sectorial Strategies and Policies for achieving MDG 2 targets
• Progressive universal coverage starting with Pre-k (+ “catching up strategies”)• Regional focus: priority rural areas (higher gaps)• Direct subsidies to poorest population• Incentivize private provision of education to expand supply and coverage• Incentivize innovation: in rural education (Escuela Nueva – best practice worldwide), TICs
and competences focus in education• Improve quality substantially• Teachers training and evaluation• Expand education infrastructure• Strengthen information systems at territorial entities (responsible for delivering
education) • Improve execution of integovernmental transfers (main source for financing education)
and identify new sinstruments for financing education (e.g. vouchers)
MINISTRY OF EDUCATION REQUIRES OF OTHER SECTORS AND PLAYERS TO DELIVER ON ITS MDG COMMITMENT
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
Targets and Financing forecasts for MDG 2
OBJETIVOS DE DESARROLLO DEL MILENIO – 2015
METAS ESTABLECIDAS PARA EL CUMPLIMIENTO DEL OBJETIVO 2: LOGRAR LA EDUCACIÓN PRIMARIA UNIVERSAL
METASLínea Base
19922005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Mantener la tasa de cobertura bruta en 100% para educación básica (preescolar, básica primaria y básica secundaria)
88.1% 89.1% 90.1% 91.2% 92.4% 93.5% 94.6% 95.7% 96.9% 98.1% 99.2% 100%
- Preescolar 44.9% 48.5% 52.2% 55.9% 59.6% 63.2% 66.9% 70.6% 74.3% 77.9% 81.6% 85.3% - Básica primaria 114.6% 114.3% 114.1% 113.8% 113.6% 113.4% 113.1% 112.9% 112.7% 112.4% 112.2% 111.9% - Básica secundaria 75.5% 77.1% 78.8% 80.4% 82.0% 83.7% 85.3% 86.9% 88.6% 90.2% 91.8% 93.5%Tasa de analfabetismo 1% para personas entre 15 y 24 años 2.4% 2.2% 2.1% 1.9% 1.7% 1.6% 1.4% 1.3% 1.1% 0.9% 0.8% 1%
Tasa de cobertura bruta en 93% para educación media 74.4% 76.1% 77.8% 79.5% 81.2% 82.9% 84.6% 86.3% 88.0% 89.7% 91.5% 93.2%
Tasa de repetición de 2,3% en educación básica y media 6.1% 5.7% 5.3% 5.0% 4.7% 4.3% 4.0% 3.7% 3.3% 3.0% 2.7% 2.3%
10,6 años promedio en educación para personas entre 15 y 24 años
7 años 8,85 años 9,03 años 9,20 años 9,38 años 9,56 años 9,74 años 9,92 años 10,09 años 10,27 años 10,45 años 10,63 años
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
FINANCING 2005 … 2015 TOTAL
TOTAL MDG 2 344,326 2,065,954 13,256,536
Central Government Budget 258,345 1,654,463
Royalties 13,178 84,559
Transfers Central Government to Territorial Entities 1,199,480 7,696,664
Own resources Territorial Entities 97,968 628,627
Private Sector 496,983 3,188,972
ODA - 3,250
Units: Million pesos
MDG 2 was achieved!
ODI 2014 CAPE CONFERENCE, London, October 13, 2014
THANK YOU
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