UK NGO recOmmeNdatiONs tO the G20 ON develOpmeNt · UK NGO recOmmeNdatiONs tO the G20 ON develOpmeNt mexic O G20 sUmmit 2012. 1 The six principles are: focus on economic growth, global

UK NGO recOmmeNdatiONs tO the G20 ON develOpmeNtmexicO G20 sUmmit 2012

1 The six principles are: focus on economic growth, global development partnerships, global or regional systemic issues, private sector participation, complementarity and outcomes- orientated.

“develOpmeNt based ON the seOUl cONseNsUs will therefOre be part Of fUtUre G20 sUmmits... what we prOmise, we will deliver.”The Seoul G20 summit outcome document

At both the Seoul and Cannes G20 summits, leaders recognised the importance of considering the impact of their decisions on developing countries. The establishment of the G20 Development Working Group and its associated action plan also created a new stream of work for the G20 and a permanent place for development issues on the G20’s agenda. The G20’s approach to development is closely aligned with its overall Framework for Strong, Sustainable and Balanced Growth, as articulated in the six principles outlined in the Seoul Development Consensus for Shared Growth1. As such, the G20 has focused its efforts in areas that it considers would address barriers to economic growth in developing countries.

This paper outlines the recommendations of UK civil society to the G20 and the G20 Development Working Group, focusing on five priority areas: inclusive growth and reducing inequality; infrastructure; food security; green growth; and transparency and accountability.

abOUt bONd

Bond is a network of 360 UK-based international development organisations united by a common goal to eradicate global poverty. We influence governments and policy-makers, strengthen the sector by developing the skills of people and improving the effectiveness of organisations, and provide opportunities to share information, knowledge and expertise. www.bond.org.uk

acKNOwledGemeNts

This joint submission was developed by the Bond G20/G8 policy group, which includes over 40 Bond member organisations.

For further information, please contact Joanna Rea, International Advocacy Adviser: [email protected]

iNtrOdUctiON

04 sUmmary Of recOmmeNdatiONs

06 1. iNclUsive GrOwth aNd redUciNG iNeqUality

08 2. fOOd secUrity10 3. iNfrastrUctUre11 4. GreeN GrOwth aNd

sUstaiNable eNerGy 12 5. tax aNd aNti-

cOrrUptiON aNd G20 accOUNtability

cONteNts

1 Recognise the importance of looking at "quality of growth" as part of a good recovery, and use this to introduce a focus on decent work, inequality and commit to including beyond GDP measures in its own work

2 Support the implementation of policies to promote inclusive growth and tackle inequality

1 Ensure that all projects are subject to transparency and accountable social, environmental and poverty reduction audits that include consultation with all stakeholders

2 Agree that project implementation will focus on poverty reduction and local job creation

3 Adopt best practice transparency standards in the sector, as exemplified by the Construction Sector Transparency (CoST) initiative, to ensure both effective use of finances and increased poverty reduction

4 Examine where public sector funding needs to be found to address gaps in critical areas of pro-poor infrastructure for which private financing has tended not to be forthcoming, such as rural roads

5 Ensure that local communities and civil society are consulted in project selection, design and implementation and all phases of project roll-out are transparent and accountable

1 Prioritise investment in sustainable, equitable, and resilient small-scale food agriculture, with a focus on women smallholder farmers

2 Build on progress made to date on emergency food reserves

3 Focus on reformed agricultural research and extension services that prioritise low-cost, agroecological, farmer-led practices and technologies that maintain biodiversity and are accessible to women farmers

4 Call for transparency in global land deals and for the adoption and implementation of the Committee on World Food Security (CFS) Voluntary Guidelines

5 Respond to the recommendations from 10 international organisations in 2011 by calling for all biofuel mandates and subsidies to be removed

6 Address knowledge gaps in multi-sectoral approaches to improving nutrition by requesting G20 agriculture ministers to identify agriculture policies and practices that effectively improve household nutrition, and agree a mechanism in 2013 to use this knowledge to assist low-income countries in policy formulation

7 Emphasise the important role of safety nets in providing food and nutrition security, top up funding for the Rapid Social Response Trust Fund and task the new social protection cooperation body to be established at the Los Cabos G20 summit to urgently conduct an assessment of safety net readiness in all low-income countries

iNfrastrUctUre fOOd secUrity

iNclUsive GrOwth aNd redUciNG iNeqUality

sUmmary Of recOmmeNdatiONs tO the G20

UK NGO submission to the G20 development working Group04

tax aNd aNti-cOrrUptiON

1 Commit to measuring progress towards sustainability and a just transition to a green and fair global economy within its own Mutual Assessment Process, and pledge support to initiatives to develop and implement measures beyond GDP

2 Support initiatives at the 2012 UN Conference on Sustainable Development (known as Rio+20) to build the foundations for a set of universal Sustainable Development Goals that do not detract from efforts to reach current Millennium Development Goals and are fully integrated into the post-2015 process and framework.

3 Fulfill its commitment to eliminate damaging fossil fuel subsidies and exploring bunker taxes within the Climate Finance study group

4 Ensure policy coherence for sustainable growth in relation to the role of financial sector and market mechanisms by reforming the credit rating agencies to include sustainability criteria and amend the Santiago Principles sovereign wealth funds to reflect sustainability criteria

5 Support the United Nations Secretary General’s ‘Sustainable Energy for All’ (SE4ALL) Initiative

1 Adopt all 12 recommendations from the UN, IMF, World Bank and OECD on how to support strengthening developing countries tax systems

2 Continue to promote progress on domestic resource mobilisation through the G20 Development Working Group agenda

3 Make further progress on tax haven transparency through the Finance Ministers track, to deliver global solutions from which developing countries can benefit

4 Maintain progress on extractive industry transparency by supporting a robust global standard for mandatory country-by-country reporting

5 Extend the mandate of the G20 anti-corruption working group beyond 2012

6 Take stronger steps on ‘beneficial ownership’ by leading on how to deal with secrecy jurisdictions

1 Establish a permanent G20 Accountability Framework for all G20 workstreams

2 Publish the terms of reference, names and affiliation of all members of expert and working groups and taskforces

3 Publish all commissioned report in draft form for input and comment from civil society and other stakeholders

4 Develop a formal process for G20 working groups to consult with civil society

“the G20 shOUld recOGNise the impOrtaNce Of lOOKiNG at the qUality Of GrOwth aNd iNtrOdUce a fOcUs ON deceNt wOrK, iNeqUality aNd cOmmit tO iNclUdiNG beyONd Gdp measUres iN its OwN wOrK.”

GreeN GrOwth aNd sUstaiNable eNerGy

G20 accOUNtability

05

2 “Inequality, Leverage and Crisis”, Kumhof and Ranciere, IMF November 2010

1. iNclUsive GrOwth aNd redUciNG iNeqUality

“We recognise the importance of addressing the concerns of the most vulnerable. To this end, we are determined to put jobs at the heart of the recovery, to provide social protection, decent work and also to ensure accelerated growth in low income countries (LICs)” Para 5, Seoul Leaders’ declaration

The G20 has recognised the importance of inclusive growth and of strengthening the social dimensions of globalisation. As part of its overarching commitment to ensure sustainable, strong and balanced growth, the G20 must underscore its commitment to tackling inequality and the global jobs crisis.

“Inclusive growth” would allow all people to contribute to and benefit from growth. Ensuring productive and decent work, investing in policies which promote wellbeing for all and challenge inequalities, such as free and public healthcare and education, small-scale agricultural production, and working to reduce poverty are all key drivers of this. Yet inequality is on the rise, more than 1.4 billion people continue to live in poverty, and globally the number of people in vulnerable forms of work, or out of work, is at record levels. Young people, women and the poor have been hit the hardest. Growth is slowing globally, yet where there is growth, it is largely jobless and often amid growing inequality.

The World Economic Forum identified growing inequality as a top global risk in 2012. Income disparity within countries is correlated with higher social conflict, lower growth and higher poverty, as well as being a key underlying cause of the global financial crisis itself.2 If countries progress on GDP but fail to improve on measures such as these, there is a problem. Yet, the OECD has recently noted that inequality within OECD member states is widening. Bold and coordinated action to promote inclusive growth in the developing world is required, ensuring that the G20 is working to ensure inclusive growth and reduce inequality as part of its overarching commitment to strong, sustainable and balanced growth.

Governments should explicitly recognise the importance of measuring the rate and distribution of growth, endorse measurement of inclusivity alongside GDP, and bring measures on inequality into standard measures of growth as proposed by the Commission on the Measurement of Economic Performance and Social Progress (The Stiglitz Commission).

The G20 should pursue policies and approaches that will reduce inequality and deliver on inclusive growth. Tried and tested transformative public policies with a long track record in delivering on inclusive growth should form an essential plank of the G20's approach.

“the G20 shOUld pUrsUe pOlicies aNd apprOaches that will redUce iNeqUality aNd deliver ON iNclUsive GrOwth.”


• Ensures that the G20 supports the implementation of policies to promote inclusive growth and tackle inequality including:

o Higher public spending on services which have a powerful redistributive and inequality reducing effect, particularly when invested in universal free and public health and education, targeted nutrition programmes, scaling-up employment creation and labour market activation programmes

o Prioritisation of counter-cyclical spending; fairer fiscal systems which enshrine progressive taxation policies and improve tax collection capacity, and international agreements to tackle tax evasion and avoidance and crack down on tax havens

o Ensuring the interagency coordination mechanism on social protection being established by the World Bank and International Labour Organisation (ILO)has clear targets to assist all countries to establish social protection floors by 2020, and financing for start-up costs in low income countries

o Inserting a pro-poor perspective into its support to economic development strategies in low income countries via the development working group, through initiatives to support small businesses and improve the quality of informal jobs where poor people tend to be economically active.

we recOmmeNd that the G20:

• Recognises the importance of looking at "quality of growth" as part of a good recovery, and use this to introduce focus on inequality and commit to including beyond GDP measures in its own work. Specifically the G20 could begin by:

o Publicly reporting progress against its objective to promote more inclusive growth by producing an annual progress report on reducing inequality, unemployment and vulnerable employment; and supporting the development of better indicators than GDP to be included in the G20’s Mutual Assessment Process

o Tasking the IMF in conjunction with other relevant international organisations to report annually on inequality. In specific terms, the G20 should ask the IMF to systematically measure inequality by monitoring and reporting on Gini coefficients as part of its Article IV consultations; and measuring and reporting on the income share of each country’s top 10% and bottom 10% also as part of its Article IV consultations

07

Craft Aid (Mauritius) Co. Ltd is a non profit-making organisation dedicated to the welfare of the disabled people. Our main objective is to provide paid employment for people with disabilities (August 2008) Shared interest

food security. Agriculture needs to be integrated with food security and nutrition objectives to make a sustained contribution to improved food and nutrition security.

Working hand-in-hand with nutrition-sensitive agriculture is a continued focus on gender integration in agriculture. There is clear and robust evidence that shows the benefits for children and families when gender considerations are incorporated into both agriculture and nutrition programs. For example, the Food and Agriculture Organisation (FAO) estimates that if women had the same access to productive resources as men, they could increase yields on their farms by 20 – 30% which could raise total agricultural output in developing countries by 2.5 – 4%, which could in turn reduce the number of hungry people in the world by 12 – 17%.

However, support to agricultural productivity alone remains insufficient to meet food security challenges. As agreed by almost all G20 members at L’Aquila in 2009, in the long term, government-led, cash based social protection systems and targeted nutrition interventions are also needed to provide long-term food security to the poorest and most marginalised populations. In the short term, social safety nets are also crucial to help communities, including smallholder farmers, to prepare for and cope with crises and shocks such as the current food price rises and global economic decline.

2. fOOd secUrity

Agriculture has the potential to play a critical role in the elimination of hunger and malnutrition. When provided with access to natural resources, information, and markets smallholder farmers can, generate more income, send their children to school and help lift their community out of poverty for the long term. This ‘multiplier effect’, catalysed by agricultural growth, is the reason that investments in agriculture are estimated to be around two to four times more effective in reducing poverty than growth generated from other sectors. Furthermore, support to improve the productivity of smallholder farmers that produce food for consumption by their family can lead to an increased quantity and quality of food in their diet. Through farming more sustainably and diversifying production and income, farmers can build adaptive capacity to deal with future shocks. And, strengthening the rights and addressing the specific needs and constraints of women small-scale food producers addresses women’s rights as well as improving agricultural and nutrition outcomes.

The availability of food and higher incomes do not, however, guarantee better nutrition. The World Bank and others have shown that chronic malnutrition persists even among the food secure, and has significant long-term impacts on children and the economic potential of a country. G20 Agricultural Ministers recognised in 2011 that securing a nutritious diet for the most vulnerable people is a critical dimension of

A combination of global trends – climate change, energy demand, volatile food prices, economic uncertainty and demographic shifts – is putting progress on tackling hunger, food security and malnutrition at risk. Important steps towards improving food security and agricultural productivity were achieved at the G20 in 2011, but the G20 must scale up its ambition to match the scale of the global hunger and malnutrition crisis. Continued global economic decline and rising oil and food prices in 2012 will exacerbate the crisis further and the World Bank has warned developing countries to prepare for a global economic crisis on a par with that of 2008-09.

“aGricUltUre Needs tO be iNteGrated with fOOd secUrity aNd NUtritiON Objectives tO maKe a sUstaiNed cONtribUtiON tO imprOved fOOd aNd NUtritiON secUrity.”


Evidence from the International Land Commission, arguably the best available, suggests that large-scale land deals in the past decade may cover 203 million hectares, or an area eight times the size of the UK, with devastating impacts for those who used to depend on that land to feed their families. Many of these deals are ‘land grabs’, concluded without the consent of affected communities.

Biofuels policies are driving large-scale land acquisitions: according to the International Land Commission, land acquisitions to grow biofuels feedstocks may account for up to 60% of all large-scale land deals. Critically, biofuels are and will continue to be a significant factor in food price rises and volatility, as concluded in 2011 by 10 intergovernmental organisations (IMF, World Bank, OECD, etc). Biofuels also reinforce links between energy and food markets, making food prices more responsive to high oil prices. The existence of rigid biofuel targets compounds problems, adding a further inelastic factor into the food system.


• Prioritises investment in sustainable small-scale food production, particularly by women, which is crucial not only for increasing productivity but also for the food security of those most vulnerable to climatic and economic shocks

• Focuses on reformed agricultural research and extension services that are farmer-led, focus on key staple food crops, scale up agro-ecological practices, are accessible to women farmers, support the adaptation of agriculture to climate change, and provide access to critical weather and market information

• Builds on progress made in 2011 on emergency food reserves by committing the necessary technical and financial resources to scale up community-based, national and regional reserves and to implement the ECOWAS PREPARE pilot

• Addresses knowledge gaps on multi-sectoral approaches to improving nutrition by requesting G20 agriculture ministers to identify agriculture policies and practices that effectively improve household nutrition, and agree a mechanism in 2013 to use this knowledge to assist low-income countries in policy formulation

• Emphasises the important role of safety nets in providing food and nutrition security, top up funding for the Rapid Social Response Trust Fund and task the new social protection cooperation body to be established at Los Cabos to urgently conduct an assessment of safety net readiness in all low-income countries

• Calls for transparency on global land deals and for adoption and implementation of the Committee on World Food Security (CFS) Voluntary Guidelines

• Respond to the recommendation from 10 international organisations in 2011 by calling for the abolition of all biofuel mandates and subsidies

09

When the sun rises over Suraj ka Kheda in Rajasthan, India, Geeta begins working in fields close to her home but ongoing drought has devastated agriculture (Oct 2010) Oxfam Ami Vitale

3. iNfrastrUctUre

The G20 has endorsed and committed to deliver the recommendations of the 2011 high-level panel on infrastructure. As the G20 moves to this implementation phase it must ensure that project selection and preparation follow best practice in this sector, is focused on poverty reduction and includes ongoing consultation with local and affected communities.

Furthermore, experience of involving the private sector in infrastructure projects in developing countries has not always been positive in the past, in terms of poverty reduction and environmental outcomes. There is therefore a need for robust and transparent monitoring of all projects.


• Ensures that all projects are subject to transparency and accountable social, environmental and poverty reduction audits that include consultation with all stakeholders

• Agrees that project implementation will focus on poverty reduction and local job creation

• Adopts best practice transparency standards in the sector, as exemplified by the Construction Sector Transparency (CoST) Initiative, to ensure both effective use of finances and increased poverty reduction

• Examines where public sector funding needs to be found to address gaps in critical areas of pro-poor infrastructure for which private financing has tended not to be forthcoming, such as rural roads

• Ensures that local communities and civil society are consulted in project selection, design and implementation and all phases of project roll-out are transparent and accountable

“all prOjects shOUld be sUbject tO traNspareNt sOcial, eNvirONmeNtal pOverty redUctiON aUdits.”


Solar engineering trainer from Barefoot College, India. From September 2011 to March 2012, women travelled from across Africa to take part in training to become solar engineers led by trainers from India (March 2012) UN Women/Gaganjit Singh

GreeN GrOwth

G20 countries should reaffirm their commitment to sustainable development and to a complementary approach to social, environmental and economic progress. Greening economies can only be achieved when growth is also made more inclusive. This can only be achieved by recognising the need to achieve a safe and just operating space within planetary boundaries and above a social protection floor, and recognition of common but differentiated responsibilities of all countries. The G20 can play a lead role in setting such a direction for green economy discussions at the Rio+20 summit.

Furthermore, developing countries should not just become markets for developed countries green goods and technologies, if greening the economy is also to be fair and balanced. This means allowing developing countries the space and supporting them to develop their own green industries and technologies, not just focus on liberalisation of green goods and services and strengthening intellectual property regimes. Developed countries must also support capacity building for sustainable development in the global south. Specific commitments are required on the transfer of green technologies and techniques, quality education and training, and the development of green skills and green jobs.

4. GreeN GrOwth aNd sUstaiNable eNerGy


• Commits to measuring progress towards sustainability and a green and fair global economy within its own Mutual Assessment Process, and pledge support to initiatives to develop and implement measures beyond GDP

• Supports initiatives at the Rio+20 to build the foundations for a set of universal Sustainable Development Goals that do not detract from efforts to reach current Millennium Development Goals and is fully integrated into the post-2015 process and framework.

• Fulfills its commitment to eliminate damaging fossil fuel subsidies and exploring bunker taxes within the Climate Finance study group

• Ensure policy coherence for sustainable growth in relation to the role of financial sector and market mechanisms by reforming the credit rating agencies to include sustainability criteria and amend Santiago Principles sovereign wealth funds to reflect sustainability criteria

sUstaiNable eNerGy fOr all

As a key part of its Green Economy strategy the G20 must support the United Nations Secretary General’s ‘Sustainable Energy for All’ (SE4ALL) initiative. Poor countries and the world’s poorest people will need substantial assistance to achieve universal energy access from clean, safe, reliable and affordable sources, as well as moving their energy sectors away from dirty fossil fuels.


• Leads by providing poor countries with the appropriate finance, technology and capacity building to deliver local development within the framework of an ambitious SE4ALL Initiative, as well as ensuring that their own energy sectors are on track to be zero-carbon by 2050

• Delivers investment and capacity for technology innovation and market development in developing countries

• Ensures that the SE4ALL delivers clean modern energy for the world’s two billion people living in energy poverty. This will require effective governance and monitoring of results. SE4ALL needs to have defined channels of accountability, based on clear progress indicators and a clear and transparent process of monitoring and evaluation

• Consults with civil society. If the Initiative is to gain widespread support, local and global civil society needs to be fully consulted through a clear and accountable process. Civil society should play an active role in all stages of policy design as well as implementation, especially within priority countries

11

tax aNd aNti-cOrrUptiON

Since the London summit in 2009, the G20 has been the leading global power structure in the fight for tax haven transparency. Because developing countries lose vital revenues to tax havens, it is essential that they are able to benefit from global solutions, such as the Multilateral Convention on Mutual Assistance in Tax Matters, initiated through the momentum derived from the G20. The G20 must show further leadership if this is benefit is to be realised.

Work taken forward on the broader domestic resource mobilisation area of the G20 Development Working Group has also been valuable for developing countries, for example in the area of donor coordination. The G20 Development Working Group stated in Cannes:

“taxation provides governments with the funds needed to invest in development, relieve poverty and deliver public services. Taxation provides fiscal responsibility and sustainability that is needed to promote growth and to reduce reliance on external flows (particularly development aid) in the long term. It also improves growth resilience to external shocks, offering fiscal space to finance countercyclical economic policies.”

5. tax, aNti-cOrrUptiON aNd G20 accOUNtability


• Adopts all 12 recommendations from the IMF, OECD, UN and World Bank on how to support strengthening developing countries tax systems. Only one of these was adopted in Cannes. The G20 should agree at the Los Cabos summit to implement the other 11 recommendations

• Continues to promote progress on domestic resource mobilisation through the G20 Development Working Group agenda

• Makes further progress on tax haven transparency through the Finance Ministers track, to deliver global solutions from which developing countries can benefit (eg. through putting pressure on tax havens to sign the Multilateral Convention on Mutual Assistance in Tax Matters)

• Maintains progress on extractive industry transparency by making a statement supporting a robust global standard for mandatory country-by-country and project level reporting that establishes a meaningful disclosure requirements and a level playing field for companies

• Extends the mandate of the G20 Anti-Corruption Working Group. The working group has adopted an Anti-Corruption Action Plan, which expires at the end of 2012. We believe that the work they have started needs to be continued

• Strengthens its efforts to prevent corrupt officials from accessing the global financial system and from laundering the proceeds of corruption, as per the 2011 Action plan. In this regard, the G20 should take stronger steps on ‘beneficial ownership’ – for example, by leading on how to deal with secrecy jurisdictions


G20 accOUNtability

In official communiqué of the 2011 summit, G20 leaders declared:

“We hold ourselves accountable for our commitments and will review progress at our next Summit.” G20 leaders have also recognised that “to strengthen its ability to build and sustain the political consensus needed to respond to challenges; the G20 must remain efficient, transparent and accountable” and have committed to “to build on an innovative global development partnership that will focus on concrete and sustainable results, deepening our engagement with the private sector and civil society.”

However, despite these commitments, the G20 is still to establish a transparent accountability framework for all of its workstreams or put a formal process in place for consultation with civil society.


• Establishes a permanent G20 Accountability Framework for all G20 workstreams. To enhance credibility and ensure effectiveness, the framework must be rigorous, transparent and inclusive. The diversity of the G20 provides an opportunity to open new avenues of inclusiveness with international organisations, governments, civil society and the private sector to improve the efficiency and effectiveness of the G20’s contribution to development cooperation

• Publishes the terms of reference, names and affiliation of all members of expert and working groups and taskforces

• Publishes all commissioned report in draft form for consultation and input from stakeholders before they are finalised

• Develops and implements a formal process for G20 working groups to consult with civil society and communities affected by the G20’s decisions and actions, including developing countries

“the G20 mUst establish a traNspareNt accOUNtability framewOrK fOr all Of its wOrKstreams.”

13

“G20 cOUNtries shOUld reaffirm their cOmmitmeNt tO sUstaiNable develOpmeNt aNd tO a cOmplemeNtary apprOach tO sOcial, eNvirONmeNtal aNd ecONOmic prOGress.”

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UK NGO recOmmeNdatiONs tO the G20 ON develOpmeNt · UK NGO recOmmeNdatiONs tO the G20 ON develOpmeNt mexic O G20 sUmmit 2012. 1 The six principles are: focus on economic growth, global