Global Social Policy Digest 18.1

Redistribution

Another recent leak of offshore investments has provided useful insights for regulators on tax avoidance strategies employed by some of the world’s leading companies. The release of the Paradise Papers demonstrates just how pervasively tax avoidance advice is dispensed by mainstream corporate accounting firms. ¹ As the sheer size of the tax avoidance industrial complex is becoming apparent, many states have begun to take action to prevent companies from stashing their profits overseas. Even the low-tax haven of Switzerland has now committed to compel multinationals in its territory to reveal where around the world they are earning revenues through sales and what taxes, if any, they are paying (the so-called country-by-country reports). ² Additionally, the third regional meeting of the Inclusive Framework on Base Erosion and Profit Shifting (BEPS) ³ was an occasion to exchange observations and evaluate recent developments, mainly focusing on the peer-review mechanisms and the time lines to put into force minimum standards across participating countries.

Another important development comes from recent International Monetary Fund (IMF) research on individual tax rates. The report argues that higher income tax rates for the top 1% of earners would diminish inequality without negatively impacting on growth. ⁴ As stated in The Guardian’s Editorial, the IMF analysis shows that there is no evidence for the trickle-down theory as growth rates have not picked up after taxes have been cut for the top 1%. On the contrary, they are much weaker than they were in the immediate postwar decades when the rich could expect to pay at least half their incomes – and often substantially more – to the taxman. ⁵

This analysis is one of several welcomed changes in tone at the IMF, whose policy conditions on lending have undoubtedly worsened economic inequality for decades. Oxfam recently published a close examination on the latest IMF actions to combat inequality, which consist primarily of the integration of inequality analyses into its economic surveillance of countries. The report concludes that the efforts made so far do not constitute a ‘systematic inclusion of inequality in policy discussion’ because it is based on a ‘compensatory’ approach that seeks to compensate losers rather than engender meaningful structural reforms. ⁶

Regulation

The role of business in achieving sustainable and inclusive development was highlighted at the 2017 Sustainable Development Goal (SDG) Business Forum. ⁷ The United Nations (UN) Secretary General António Guterres emphasized the importance of financial solutions to help achieve the SDGs and encourage the business community to participate. Accordingly, Global Compact hosted a series of events in September that laid out a path to reach the SDGs by promoting strategic partnership between the United Nations and the private sector. ⁸ An important step forward was the commitment by more than 300 global companies to establish emissions reduction targets ⁹ through the Science Based Targets Initiative. Since many companies share suppliers, collective action by companies will be key to reduce emissions within their industries’ supply chains.

Business leaders have been keen to identify how corporate action on the environment or other issues will be reflected in the SDGs. Reporting by business on SDG contributions was the subject of this year’s annual United Nations Global Compact Report published 21 September 2017 by the Global Compact and the Global Reporting Initiative (GRI). ¹⁰ The report lays out recommendations designed to assist business in reporting against the SDG targets and align corporate reporting cycles to those of the SDGs. The document also detailed the engagement being made by corporate management in support of the goals. It states that almost 70% of chief executive officers (CEOs) are involved in developing and evaluating sustainability strategies within their companies. Meanwhile, involvement by boards of directors also shows a strong increase since 2015 of 28%.

The implementation of the World Trade Organization (WTO) Trade Facilitation Agreement has gained ground since Viet Nam, in a joint project with the Global Alliance for Trade Facilitation, adopted reforms to improve its complicated import–export administrative procedures. ¹¹ Furthermore, Britain and the European Union (EU) advised WTO members of their plan to divvy up the EU’s tariff quotas and farm subsidies following Brexit, which immediately led to strong critics from the White House and other WTO member states who want greater access to the UK market for their farm products. ¹²

One of the most important upcoming events will be the WTO’s 11th Ministerial Conference that, for the first time, will gather the Trade Ministers from WTO Member States in a South American country. ¹³ The meeting will be hosted in Buenos Aires in December. An article that summarizes the preparations with an in-depth analysis of what is at stake ¹⁴ claims that negotiations will be heating up particularly on issues related to e-commerce, services and fish subsidies as new proposed rules may hide benefits for big fleets at the expense of smaller fishing operations.

Rights

Ahead of the COP23 climate change summit to be held in Bonn from 6 to 17 November, UN experts urged governments that human rights must be central in the implementation of the Paris Agreement. ¹⁵ Experts noted that climate change is related to other pressing human rights issues. They stated that ‘We have already seen the very real effects that climate change has on people’s homes and livelihoods, on their rights to health, housing, food, water and sanitation, development and many others’. ¹⁶ This is a timely message as the recent hurricanes in the United States and the Caribbean and the extreme monsoons in South Asia showed the devastating impacts on people’s lives. Former president of Ireland, Mary Robinson, pointed to the recent extreme weather events when she said, ‘The profound injustice of climate change is that those who are most vulnerable in society, no matter the level of development of the country in question, will suffer most. People who are marginalised or poor, women, and indigenous communities are being disproportionately affected by climate impacts’. ¹⁷

In the lead up to the summit, Human Rights Watch expressed concern that Fiji’s Prime Minister, Frank Bainimarama, who himself had previously taken power in a coup d’etat, was being silent on the human rights obligations of the Paris Agreement. ¹⁸ At the summit, it appeared that these criticisms were heard as one of the presidency events focussed specifically on ‘Integrating human rights in climate action’. ¹⁹ However, whether states will develop plans that follow through on human rights concerns of marginalized populations remains to be seen.

Migrant rights and specifically the case of Australia have also received a great deal of attention over the last few months. The Australian announcement that it will shut down the Manus Island regional processing centre has led to a great deal of criticism of the Australian government. ²⁰ The Australian government has claimed that it is not responsible for the refugees as they are not on Australian soil. However, the UN Human Rights Committee has stated that Australia is responsible and has obligations under the 1951 Refugee Convention. Yuval Shany, the UN Human Rights Committee vice chairman, stated that Australia had ‘effective control over this situation and as a result it has responsibility for the fate of these individuals’. ²¹ Some 500 individuals remained in the processing centre following its closure with no electricity, food or water. ²² Australia’s policies and treatment of asylum seekers as well as indigenous populations were brought forward as clear issues it must address as it takes over the leadership of the UN Human Rights Council for a 3-year term starting in 2018.

Social protection

Addressing the pressing humanitarian situation in the MENA region and elsewhere was high on the agenda at the recent International Conference on Social Protection in Contexts of Fragility and Forced Displacement. The gathering, organized by a consortium of bilateral and international development and humanitarian agencies on 28–29 September 2017 in Brussels, was organized to explore synergies between humanitarian and development initiatives involving social protection provision. ³⁴ During the meeting, it was suggested that humanitarian actors should seek to leverage the existing social protection infrastructure in a country, so that interventions upgrade and strengthen national capacities to administer emergency and social assistance programmes. Early investments in state capacities were suggested as preventative measures, which could prevent future political and social crises and the subsequent need for international humanitarian response. In addition to man-made shocks, natural shocks linked to extreme weather events brought about by climate change are also being tackled through innovative social protection programming. Through its series on ‘shock responsive social protection’, Oxford Policy Management published a case study on the potential for social protection programmes designed to tackle everyday deprivation to be leveraged to respond to recurrent, predictable climactic shocks and build the resilience of beneficiaries against the effects of climate change. ³⁵

Beyond shocks and forced displacement, developing social protection systems in contexts of fragility was also discussed at the Brussels conference and elsewhere. Some have suggested that in fragile contexts, universal schemes such as child grants may be most effective, given limited administrative capacities to target support and widespread poverty. ³⁶ Meanwhile, the topic of social protection in fragile contexts was also the topic of a UNICEF-organized webinar that took place on 8 November 2017. ³⁷

Health

A recent study in The Lancet showcased that out of the approximately 55 million abortions undergone every year in between 2010 and 2014, about 25 million, hence slightly lower than half, could be classified as unsafe, putting the life of as many women at risk. ³⁸ Links between access to safe abortion and good levels of maternal health have been established worldwide, especially since it has been statistically proven that the abortion rate is higher in countries with a ban than in those allowing terminations. ³⁹

Latin America hosts six countries that ban abortion under any circumstance, including when the pregnancy is a threat to the expectant mother’s life: the Dominican Republic, El Salvador, Haiti, Honduras, Nicaragua and Suriname. That four of them are based in Central America is not surprising to many observers.

Nicaragua, for instance, has one of the highest teen pregnancy rates of the world. ⁴⁰ Women and young girls’ health is put into danger by illegal abortions. Even in the case of severe and life-threatening developments in the foetus, hospitals are in no position to terminate pregnancies unless the unborn baby’s heart has stopped beating. This total ban, only shared by two more countries in the world (Malta and the Vatican), would have been unthinkable after the Sandinistas revolution but was implemented at the start of the second Ortega presidency in 2007. Since then, the country has been experiencing a blur between church and state laws with a President converted to hard-line Catholicism.

In South America, Peru ranked at the bottom of a recent poll that rated women’s health care in megacities with dramatic levels of teen pregnancies and sexual violence and a frightening gap in access to maternal health-care services between the wealthier and poorer population. ⁴¹ Abortion is illegal unless the mother’s life is in danger. Argentina famously sued a young woman, Belen, who went to hospital because of a miscarriage, for having had an illegal abortion; she served 2 years in prison before being acquitted earlier this year. ⁴²

Not only do inequalities in access to health care reflect a worrying societal picture; the close link between an abortion ban and a socially conservative, often religious society and/or government makes countries refusing women abortions among the less progressive in terms of human rights. As such, the existence of a link between the state of a country’s democracy and the reproductive rights of its female citizens has recently been discussed as it appears that those countries with the most restrictive legislation also showcase the widest gender inequalities and overall discriminations towards women especially out of the most vulnerable population groups. ⁴³

The latest developments of abortion rights in Chile are corroborating this thesis: while congress approved for legal abortion in 1931, that right was lifted under Pinochet to be reinstituted long after restoration of democracy, in August 2017 when the Court finally approved easing the total abortion ban. ⁴⁴

Women’s empowerment was at the centre of Dr Tedros Adhanom Ghebreyesus campaign to become World Health Organization (WHO)’s new Director General (DG). For example, he declared universal health care to play a central role during his presidency – and that women, children and adolescents were at ‘the center of gravity of universal health coverage’. However, the new DG is facing a number of challenges. ⁴⁵ In particular, the planned increase in countries’ contributions to WHO’s budget was not as high as expected, albeit necessary after years of zero growth. Beyond the assessed contributions, the WHO depends greatly (making up 80% of its budget) on voluntary contributions by countries and individuals. Here, Dr Tedros will have to convince those who supported his opponents. In particular, ‘final’ efforts are still needed in the fight of diseases such as polio, which suffered a setback in the Democratic Republic of Congo earlier this year. ⁴⁶ In late October 2017, WHO’s new DG faced major criticism for appointing Robert Mugabe, Zimbabwe’s dictatorial President, as a ‘goodwill ambassador’. ⁴⁷ Dr Tedros reversed his decision on international pressures pointing out that the country’s health system was at its worse since President Mugabe was in power, health professionals often remaining unpaid and deaths as a result of childbirth were on the rise, while the overall human rights situation remained worrying.

Education

On 24 October, UNESCO released the Global Education Monitoring Report (GEMR), one of the most relevant annual documents in the field of education and development. This latest edition of the report has two main focuses. First, as in past editions, is the assessment of global progress towards the Sustainable Development Goal for Education (SDG4). In this respect, the GEMR, among other issues, highlights that today, there are still 264 million children of primary or secondary age out of school; a situation that makes it difficult to achieve the goal of universal primary and secondary education. At the same time, the report also shows that 56% of primary school-age children have not achieved the minimum proficiency in reading. ⁵⁷ The second focus of the GEMR this year is on accountability policies in education. In this respect, the GEMR recognizes the need for accountability policies to ensure that the goals of national education systems are achieved but also warns about the possible unintended consequences of these policies. ⁵⁸ For example, the report reviews evidence demonstrating that accountability measures for teachers or performance-related teacher pay that are based on students’ test scores sometimes reduce the collaboration between peers or narrows the curriculum, encouraging teaching-to-test strategies. The report also shows the need to increase the accountability mechanisms of governments and the requirement for strong state regulation to guarantee that all educational actors, particularly private providers, meet the quality and equity standards. In this respect, the GEMR recommends designing accountability policies for teachers and schools based on supportive, rather than punitive, consequences and the development of regulations that ensure all education providers deliver quality education and do not develop discriminatory behaviours. To sum up, Iria Bokova, the UNESCO DG, pointed out that effective accountability policies ‘must be designed with care and with the principles of equity, inclusion and quality in mind’. ⁵⁹ For its part, Education International, an organization that represents around 400 national teachers’ unions around the world, agreed with the main findings and recommendations of the GEMR in relation to accountability policies but has also pointed to the omission of the role of teachers’ unions in designing fair and effective accountability policies. In this respect, Fred van Leeuwen, the organization’s General Secretary, has noted the importance of teachers and teachers’ unions participation in the adoption of accountability measures in the education sector, affirming that ‘the demand of accountability falls far short on credibility when teachers’ unions and associations are omitted as essential stakeholders in education systems’. ⁶⁰

Meanwhile, the World Bank has released its annual World Development Report, focusing this time on education: ‘Learning to Realize Education’s Promise’. The report identifies the different dimensions of what it refers to as the learning crisis: the low level of learning outcomes at a global level, the immediate causes of this situation (i.e. students’ preparation, teachers’ lack of skills and the problems of governance in the education system) and the systemic causes (e.g. political power struggles, bureaucracy and technical limitations). To address the learning crisis, the World Bank recommends policy actions that are oriented towards the assessment of learning, the use of evidence in the design and development of educational policies and the need to align the different actors (teachers, policymakers and families) involved in the education system. ⁶¹ Although acknowledging her initial scepticism about the report because of the World Bank’s historical approach to education, in a recent article, Prachi Srivastava (associate professor of education and international development at the University of Western Ontario) points out that the report has highlighted some positive messages. Among others issues, Srivastava notes that the World Bank has analysed the evidence and found that the low level of learning outcomes is primarily the result of inequalities between different socioeconomic backgrounds, the impact of private educational provision and market assumptions or the focus on processes within schools and their impact on learning outcomes. ⁶²

Finally, in August, 174 civil society organizations called on investors and international donors to cease their support for Bridge International Academies (BIA). BIA is a network of private schools operating in India and in four African countries. The released statement warns about the practices developed by BIA schools in relation to the exclusion of poor students, the poor working conditions of teachers, the lack of transparency with respect to their relationships with national governments and their negative effect on educational quality and equity. ⁶³ In its conclusion, the statement affirms that ‘BIA’s model is neither effective for the poorest children nor sustainable against the educational challenges found in developing countries’. For its part, in a letter to the British newspaper, The Guardian, Sean Geraghty, Chief Academic Officer of BIA, criticized the statement from civil society groups, pointing out that the evidence presented to support their arguments is based on research that is funded by these organizations. Furthermore, Geraghty highlights the results of the Kenyan BIA students in the primary school exit exam as compared to the national average. ⁶⁴ In the same vein, Shannon May, co-founder of BIA, has stated that experiences like those of BIA are a way of improving educational quality and learning outcomes in developing countries, which have to overcome problems of budget limitations. ⁶⁵ This recent controversy is more far-reaching than the particular case of BIA and addresses future issues pertaining to education and development in the context of private provision expansion in southern countries.

Environmental justice

On the occasion of the 23rd United Nations Framework Convention on Climate Change (UNFCCC) COP from 6 to 17 November in Bonn, Germany, the World Meteorological Organization reported that CO₂ concentrations in the atmosphere reached a new record level in 2016. CO₂ emissions from human activities together with natural emissions related to the El Niño weather phenomenon have contributed to this result. ⁶⁶ This year’s hurricane season illustrates the increasing impact of extreme weather events and prompted UN officials to call for more efforts to strengthen resilience and mitigation measures. ⁶⁷ Observers of COP23 have expected that the topic of climate impacts and vulnerability will be of high priority in Bonn as well as the question of how to compensate for losses and damages. ⁶⁸ The adaptation fund, for example, was established under the Kyoto Protocol in 1997 and is a financial instrument for helping people in developing countries to adapt to climate change and deal with its worst consequences such as desertification and rising sea levels. On the occasion of the 10th anniversary of the adaptation fund, COP23 is expected to affirm its role, to adjust its mechanisms to the 2015 Paris Agreement and to strengthen its financial situation. ⁶⁹

Another important instrument to support developing countries in their efforts to respond to the challenges of climate change is the Green Climate Fund (GFC). It provides financial help not only for projects targeted at adapting to climate change but also for actions of mitigation. At its last board meeting in 2017, 11 new projects were approved for a total sum of about US$400m. The projects range from the development of renewable energy, to sustainable agriculture, investment in low-carbon buildings, managing water reserves and river systems and gender-responsive protection against droughts. ⁷⁰ In July 2017, the GFC disbursed the first REDD+ payment of nearly US$8m to help Ecuador in avoiding deforestation and reducing greenhouse gas emissions. ⁷¹ REDD+ is a still rather unknown process which was initiated in 2005, at COP11 in Montreal, and refers to the goal of reducing (R) emissions (E) from deforestation (D) and forest degradation in developing (D) countries. ⁷² After years of negotiations, it became a key element of the Paris Agreement and is now considered to have a huge potential to tackle several problems at once, within an integrated approach: ‘REDD+ can contribute to significantly reduce emissions generated from unsustainable land use activities, conserve standing natural forests and increase carbon stocks in previously degraded lands, while also respecting indigenous and forest-dependent people living in these ecosystems’, said a GFC expert. ⁷³ There is evidence that avoiding deforestation is the best short-term climate change mitigation option, as the release of carbon into the atmosphere is prevented while re-growing forests, at the same time, also remove CO₂ from the atmosphere. ⁷⁴

In September 2017, the Intergovernmental Panel on Climate Change (IPCC), a UN body for the scientific assessment of climate change, agreed on the outline of its next comprehensive report: the Sixth Assessment Report (AR6). ⁷⁵ These reports are compiled by hundreds of climate and earth scientists and provide policymakers with knowledge about the current state of the climate, possible future scenarios as well as expected impacts of climate change on society and ways for mitigating and adapting to the identified risks. The new edition will cover all topics of the previous report AR5, which was released in 2014. Inspired by the implementation of the SDGs, a new feature in AR6 will be the topic of sustainable development. ⁷⁶ It will be interesting to see how scientists will integrate the social perspective in the new report and whether eco-social policies become a part of their recommendations.

COP23 is under the presidency of Fiji, a small island country which is threatened by rising sea levels in particular and, more generally, concerned about the state of our maritime environment. To support the implementation of the related SDG14 (life below water), a dedicated Ocean Conference took place in June 2017. ⁷⁷ In the concluding Call for Action, the Member States of the UN committed to increase the size of marine protection areas, to reduce the use of plastics and the amount of sewage entering the oceans as well as to implement several measures of sustainable fishing. ⁷⁸ The 2017 UN World Water Development Report was published in March and deals with an important aspect of SDG6 (clean water and sanitation), as it outlines the sustainability potentials of adequately treating wastewater. Today, over 80% of the world’s wastewater is released in the environment without treatment. ⁷⁹ Most wastewater flows into oceans adding to their pollution and increasing marine litter. The reduction of litter and waste is the goal of a UNEP campaign which was launched in February 2017: The Clean Seas Campaign aims at ‘engaging governments, the general public, civil society and the private sector in the fight against marine plastic litter’. ⁸⁰

A controversial aspect of environmental justice is the effort to establish legal concepts which recognize nature or individual parts of a local natural environment as subjects of public law. The Global Alliance for the Rights of Nature will hold an International Rights of Nature Tribunal in the context of COP23 in Bonn. In their programme, the organizers have gathered cases of environmental justice ranging from energy and mining, land use and the financialization of nature, to violence against indigenous people. While these tribunals have a rather symbolic character (there are judges, prosecutors, presenters, experts and impacted people – but no defenders!), ⁸¹ there are two more concrete decisions both from March 2017 which may be considered milestones in the development of environmental justice.

In New Zealand, a Maori tribe has been successful in their fight for recognition of their holy river: It has now been granted the same legal rights as a human being. The negotiator of the Maori said, ‘We have fought to find an approximation in law so that all others can understand that from our perspective treating the river as a living entity is the correct way to approach it, as indivisible whole, instead of the traditional model for the last 100 years of treating it from a perspective of ownership and management. ⁸²

A similar case in India perhaps may prove even more influential, since it has a much bigger scope. Here, the Ganges River, considered sacred by more than 1 billion Indians, has become the first non-human entity in India to be granted the same legal rights as people. A court in the northern Indian state of Uttarakhand ordered on Monday that the Ganges and its main tributary, the Yamuna, be accorded the status of living human entities. ⁸³ The practical consequence of both cases is that damaging or polluting the rivers now is legally equivalent to harming a human person.

In September 2017, the new ‘Partnering for Green Growth and the Global Goals 2030 Initiative’ (P4G) was launched at the Headquarters of the UN in New York. The goal is to bring together governments, business and civil society to drive inclusive and sustainable economic growth in support of the SDGs. The initiative will use three key instruments: partnerships, summits and a rigorous reporting system to showcase and amplify successful green growth ideas. ⁸⁴ The Organisation for Economic Co-operation and Development (OECD) founded a Centre on Green Finance and Investment in 2016 and organized a high-level forum on this topic in October 2017. ⁸⁵ The aim is to support the transition to a green economy through effective policies, institutions and instruments for green finance and investment. The G20 was also concerned with this topic and have established a Green Finance Study Group (GFSG). In its 2017 synthesis report, the G20 focussed on environmental risk analysis. They particularly suggest improving knowledge about the environmental sources of financial risks in order to achieve more financial security. ⁸⁶ This seems to reverse the logic of green investment which would rather seek the financial sources of environmental risks. The result of such a strategy pursued by the leading industrial countries would be a further increase in eco-social inequalities: As poorer countries experience higher environmental risks, they would soon be confronted with massive divestments if political decisions would follow this GFSG recommendation.

One of the most important conferences on environmental justice next year, the Sixth Degrowth conference on ecological sustainability and social equity, will take place in Malmö, Sweden, from 21 to 25 August 2018. The unique format of this conference series is its combination of academic, artistic and activist elements. In 2018, the organizers aim to reach out for a truly global scope by conducting two twin conferences: One in Mexico City (19–21 June) and one at the European Parliament in Brussels (18–19 September). ⁸⁷