International Development Committee inquiry on Extreme poverty and the Sustainable Development Goals

Evidence submission from the Institute of Development Studies

About the Institute of Development Studies

The Institute of Development Studies (IDS) is global research and learning organisation for equitable and sustainable change. IDS is ranked best international development policy think tank (2020 Global Go To Think Tank Index) and first in the world for development studies with the University of Sussex for the fifth year running by the QS University Rankings.

This submission draws on evidence from researchers across the Institute of Development Studies. For further information relating to this evidence submission please contact: Sophie Robinson, External Affairs Manager, s.s.robinson@ids.ac.uk +44 (0)1273 915763.

Summary points:

• There is much evidence to show that poverty is intensifying globally as a result of the economic effects of the Covid-19 pandemic, and other impacts caused by climate change and conflict. Therefore, tackling extreme poverty – and supporting international development to tackle that poverty – is now more important than ever.
• Established evidence, for example through work by the Institute of Development Studies (IDS), Oxford Poverty and Human Development Initiative (OPHI) and through World Bank indices, shows that poverty is multi-dimensional. Interactions and ratcheting effects between shocks and long-term poverty occur along varying and interacting dimensions and have been revealed clearly by Covid-19. Understanding and acting on this multi-dimensionality is essential, and FCDO policies and programmes need to recognise this in order to be more effective.
• Due to the impacts of Covid-19, climate change and conflict, and to achieve the Sustainable Development Goals by 2030, there is now an important and urgent need to tackle extreme poverty. Given this, it is disappointing that this basic commitment on extreme poverty has been lacking in the FCDO’s priority areas and generally downplayed since the merged department was established. Poverty also received very little attention in the Government’s Integrated Review. Tackling poverty should take centre stage in the FCDO’s new International Development Strategy (yet to be published).
• As the economic and social impacts of Covid-19 cause greater poverty and marginalisation globally, they threaten to leave the poorest even further behind. Addressing this will require the UK to restore its commitment to contribute 0.7 percent of its GNI in ODA and encourage all other higher income countries to do so.

The FCDO’s geographic focus and extreme poverty

Geographically, the FCDO should not be driven by the current Indo-Pacific tilt strategy. This may have negative impacts on poverty reduction, particularly for the world’s poorest - the ‘bottom billion’ – in extreme poverty who are most at risk of being left behind and face greater vulnerabilities due to Covid-19. Supporting the bottom billion requires prioritising countries across Sub-Saharan Africa where the majority of the poorest people live. It requires going beyond the African countries cited in the Integrated Review, such as Nigeria and Ghana. In Ghana, for example, there are still areas of poverty remaining but overall, the country will soon be graduating to middle-income status.  While that may lead to greater economic opportunities for the UK, focusing development efforts in Ghana, Nigeria and Kenya will not reach the populations facing the most pressing need and intersecting crises of food insecurity, health needs, poverty and conflict. Attention to the needs, rights, and freedoms of people in fragile and conflict affect-ed states in Africa, Asia and the Middle East, and of the increasing numbers of displaced and migrant populations should also be central to the FCDO’s poverty reduction and development focus.

Impacts of Covid-19 on extreme poverty

The Covid Collective (based at IDS), funded by the FCDO, has been commissioning research to understand the social economic impacts of Covid-19 in multiple countries. The headline finding from partners in Bangladesh work (an Institute of Governance Studies, BRAC project) states that: “The health shocks brought on by the spread of Covid-19, coupled with the economic crisis wrought by global lockdown measures, have had an immediate and severe impact on the state of extreme poverty. The scale of the crisis means widening numbers of people are experiencing vulnerability and financial insecurity, and risk falling further into the trap of extreme poverty.”

A synthesis report on The social economic impacts of Covid-19 in informal urban settlements, commissioned by the Covid Collective predicts that the ‘new poor’ pushed into poverty more recently ‘live in congested urban settings’ and work in sectors that were most affected by lockdowns. It also states that the “drivers of impoverishment across different contexts and social and economic groups are many, but in informal urban settlements are likely to include lost income and employment due to lockdowns and other disease containment measures, travel restrictions constraining mobility to access markets and livelihoods opportunities, and higher costs of staples such as food (Chronic Poverty Advisory Network (CPAN), 2021). 

A Covid Collective learning paper also highlighted the vulnerability of older people to greater poverty. Raising that although the heightened health risks to older people from Covid-19 are well evidenced and widely understood, “their social economic vulnerabilities and their role in mitigating indirect impacts on others in their networks have received far less attention.” It finds evidence that older people face additional challenges to being able to earn a living during the global pandemic and are at heightened risk of deepening poverty. Health and well-being impacts negatively affect older people can also contribute to greater poverty risks for their families if they’re unable to provide childcare for example, restricting the earning potential of other adults in their household.

The FCDO should use the evidence from the Covid Collective and similar research programmes to adapt and shape its extreme poverty reduction efforts in response to the impacts of Covid-19 in low-income countries.

Climate change and extreme poverty

With climate change acknowledged as the greatest future threat, a co-ordinated, holistic approach to development and climate change should be in place at the FCDO that recognises that the roots of the worst effects of climate change impacts on the most vulnerable lie in economic and social injustices that are often racial, gendered, and class-based in origin. They are also interconnected with other poverty and inequity-related issues.

As the impacts of climate change are felt even more greatly over the next ten years, success in respect to meeting the needs of many of the poorest and most marginalised starts with a strategy for climate change and development that is linked synergistically to the achievement of the SDGs. Climate change initiatives will not be sustainable unless wider interconnected issues, relating for example to water, food, healthcare, education, are also addressed concurrently.

The roots of the problem of climate change lie in economic and social injustices that are often racial, gendered, and class-based in origin, and are interconnected with a host of other issues relating to poverty and inequity. In most cases, climate change acts as stress multiplier, and hence it is important to target the root causes of vulnerability that drive these impacts. Therefore, climate justice, and the approach to climate change and development is linked synergistically to the achievement of the Sustainable Development Goals.

Currently, the UK government appears to be treating climate change as a separate, standalone issue to be tackled via the COP26 Presidency. However, we know from research at IDS that climate change, and more specifically climate justice, and the impacts of climate change on people around the world cannot be separated from issues of poverty, from sanitation, education, gender violence or food security. They are all connected and despite pledging funding for specific climate change initiatives, the overall funding cuts to UK ODA, including to programmes providing WASH facilities or girls education, for example, will have a devastating impact on the lives of poorest and marginalised populations worldwide, directly increasing their vulnerability to climate impacts. Importantly, the ODA cuts will also affect the credibility of UK in its COP26 Presidency role this year, and ultimately the FCDOs ability to address challenges around climate change and development effectively. There can be no discussion of rights, risks and responsibility for climate change that does not employ, consciously or not, ideas about justice.  

Where these issues are not attended to, there is a very real danger of locking-in or deepening existing inequalities as the preferred ‘technical’ solutions of powerful institutions (such as carbon trading, nature-based solutions, or geo-engineering) are pushed through at the expense of poorer groups.

Opportunity for FCDO thought leadership on extreme poverty and inequalities

The world continues to become more unequal economically, socially and politically. Extreme economic inequality intersects and interacts with other forms of inequality, such as gender, race, place, education and more, to produce extreme forms of inequity - exclusion, silencing of voice, marginalisation. The eradication of extreme poverty can only be achieved if the inequalities and inequities that harm people in rich and poor countries alike are tackled. With the rapid advance of digital technologies, the growth of migrant and dis-placed populations, and the expansion of global cities, new forms of inequality and inequity are also emerging and urgently need to be understood.

The FCDO has a thought leadership role it can play in understanding these intersections to better understand routes out of extreme poverty, building on the leading development research DFID has a global reputation for - drawing on the development research within the UK and convening mutual learning exchanges among research partners worldwide.

The universal nature of the challenge of poverty – made clear by Covid-19 and underpinning the SDGs – means that it affects us all, in the UK and internationally. To tackle these universal vulnerabilities the UK should prioritise investment in sciences of all disciplines. Successful programmes to address extreme poverty need to be underpinned by inclusive, participatory methods to understand underlying causes and identify routes to improvement directly with the people effected.

The capabilities of low-income countries in generating knowledge for vital transformations and tackling extreme poverty within their own communities should not be overlooked by the FCDO. Whether waste management innovations amongst poor Indian city residents; climate change adaptations amongst Bangladeshi farmers, or movements to secure women’s gains in power and autonomy, there are numerous examples of valuable innovations ‘from the margins’.

UK Government support to those providing research, innovation and solutions in a wide range of lower- and middle-income countries are important for them, but also for the UK. Findings in other counties provide opportunities for learning and directly benefit the UK with the emergence of new technologies, approaches, methods and relationships that can be adapted (and in some cases directly applied) in UK contexts.

Extreme poverty and religious minorities

Tackling extreme poverty must go hand in hand with addressing persecution of religious minorities and redressing religious inequalities. The Coalition for Religious Equality and Inclusive Development (CREID) convened by IDS in partnership with the Al-Khoei Foundation, CSW and Minority Rights Group is funded by the FCDO and believes that freedom of religion or belief is essential for people living in poverty to achieve their potential, live in dignity, free from stigma and exclusion.

CREID provides research and practical programmes tackling the impact of discrimination on the grounds of religion or belief though multiple projects in Egypt, India, Iraq, Pakistan and Nigeria. Given the growing intensification across the world of violence and persecution against religious minorities, fuelled by religious extremism and ultra-nationalism it is increasingly important to understand the impacts of religious inequalities on extreme poverty. In light of this there has been a shared sense of urgency across CREID partners to address this gap between inclusive development and FoRB and comprehensively incorporate FoRB into humanitarian and development policy and planning.

CREID’s research has also highlighted intersecting vulnerabilities that can lead to extreme poverty, including how religious inequalities intersect with disability, gender, class or ethnicity.  The FCDO should use this evidence to build on the understandings of these dimensions of extreme poverty in its programmes to address and prevent extreme poverty. It should also support the Prime Minister’s Special Envoy for Freedom of Religion or Belief to examine how the UK can best support addressing the intersecting issues of religious inequalities and extreme poverty.

Wider FCDO and Government policy

There are important opportunities regarding the potential benefits of more inclusive and collaborative forms of economic development to help tackle extreme poverty, that a new FCDO International Development Strategy should incorporate, and which wider UK government international policy can support. This can involve measures that do not prioritise growth alone but use growth as a means to benefit livelihoods, wellbeing, and poverty reduction. This can be achieved via mechanisms for a collaborative economy, involving interactions between the state and civil society, as well as private sector groups. Positive examples from development research include inclusive value chain work, which should be incorporated in the new development strategy. 

UK trade policies should also align with development aims, with progressive trade policies that protect livelihoods, create equal outcomes, ensure labour standards, prevent harmful child labour and adhere to commitments on climate change and environmental standards.