Growth and poverty reduction: policy implications from qualitative research in Tanzania
Key issues in this policy brief include:
- Poverty eradication policies have not paid enough attention to the growth of poor and very poor people’s incomes, which depends on productive asset accumulation in agriculture and the nonfarm economy. Making financial services accessible to the poor and very poor (for instance, by linking them to burial societies and other ROSCAs), and work effectively is a priority, as are measures which ease access to land, livestock and productive equipment. In the latter, policies which make land easier to rent (in and out) would be especially helpful. Policies focused on helping poor people acquire or rent farm assets (e.g. irrigation and oxen) and nonfarm business assets should complement measures focused on land.
- Asset possession also underlies resilience against shocks. It is the absence of assets which makes people especially vulnerable. Therefore, protecting assets is a priority. This may be achieved through social protection, but also through specific policies such as soil and water conservation, price stabilisation schemes, or insurance linked to financial services. Burial societies and ROSCAs are also protective mechanisms, and can be strengthened by linking them to SACCOs and securing appropriate safeguards.
- The poor operate in labour, service and commodity markets which are over-supplied (e.g. petty trade, casual labour, brewing, and subsistence foods). Returns are low as a result. Getting people from poor households into higher return markets through skills upgrading, and tightening over-supplied markets are two ways of facilitating escaping poverty.
- There are categories of people who are especially vulnerable, usually to several sources of risk, and who therefore need broad protection: households mainly dependent on casual wage labour; single adult women (unmarried, separated, divorced, widowed, and bereaved) and their dependents, socially excluded women without children; orphaned youth headed households, older people, the chronically ill and carers of chronically ill. Well designed social assistance would support the greater involvement of these groups in growth and accessing health and education services, the latter especially important for interrupting inter-generational poverty.
- There is an underlying governance agenda which is different from the wider governance improvements sought in Tanzania. This concerns the access of vulnerable groups (e.g. poor and single women) to justice, and to more transparent, accountable and participatory governance at local level. While aspects of bad governance for the poor have been removed (e.g. the development levy), public information on systems, services, and entitlements is still limited. Effective user and community costs for education, health and water have also risen.
- Mkukuta II constructively addresses several of these agendas. However, there is little focus on practical measures to improve labour markets for the poor. Given the reliance of Mkukuta II on commercialising agriculture and releasing labour to other sectors, this would seem to be a priority. More detailed proposals are given section by section.
CPRC Policy Brief
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