Poverty Strategy
During the late 1980s and early 1990s, an explicit poverty reduction strategy began to be implemented, although much fundamental change is still needed. The first concern is to pursue policies that generate macroeconomic stability and to manage the economy so as to make efficient use of the poor's most abundant asset – labor. This objective cannot be achieved unless the government is able to raise taxes and to make good use of the revenue it does receive. At present, the private sector is understandably reluctant to give resources to a public sector that it views as inefficient at best and corrupt at worst. A second key element is to increase the access that the poor have to land. This requires not only making it easier for the landless poor to acquire land but also strengthening the tenure of smallholders who already own land. Experience in other countries in the region shows that consensus-building is likely to be an important element in making this possible.
A third element is to structure public investment so that it enhances the earning potential of the poor, either by increasing their human capital or by making their existing human capital more productive. Ideally, there should be increased public financing of human capital investments, which may or may not be feasible in the short term. In terms of service delivery, the government should explore ways to make providers more accountable for the quality of the services they provide. These mechanisms can include: (i) subcontracting the provision of health and education services to private companies through open competitions, (ii) operating public facilities under management contracts; and (iii) introducing performance-based budget allocations, internal markets, and greater community participation in local budget decisions.
Statistical Systems
The principal deficiency in the national information system with respect to poverty reduction is the lack of a permanent system of household surveys to collect socioeconomic data. However, currently there are no plans to develop such a system. Because the latest poverty figures date from 1989, it is impossible to tell whether the major policy changes that have taken place since 1989 are associated with an increase or a decrease in poverty levels.
The National Statistical Institute (INE) was planning to conduct a census in April of 1994 although, as of November 1993, funding had not been secured. Also under consideration for 1994 were an agricultural census, an income and expenditure survey (last fielded in 1980/81), and a repeat of the health, nutrition, and family planning survey previously conducted in 1984 and 1987. A large portion of the funding for the health survey would come from USAID, while the financing for the other surveys was not clear at the time the poverty assessment was written. INE also carries out the National Socio-Demographic Household Survey and its companion module, the National Employment Survey, but this survey was last fielded in 1989 and did not contain any data on consumption.
The inability of INE to produce current socioeconomic data is a reflection of several factors. First, the severe budgetary restrictions that characterize the entire public sector limit funding for statistical data gathering. Second, relatively low priority is given to collecting socioeconomic data. Third, insufficient consideration is given to using the data as an input for policy decisions once they have been collected.
From a poverty reduction perspective, the highest priority should be to conduct the census and to institute a permanent system of household surveys. Issues of design and efficiency will be important considerations for maximizing the usefulness of data collection given the prevailing budget constraints. Deficiencies in the administrative records and management information systems in the line ministries should also be corrected.