§ Lynne JonesTo ask the Secretary of State for International Development what recent analysis the World bank and IMF have sent to her Department of the poverty and social impact of structural reforms supported by their programmes in poor countries; in how many instances the impact has been found to be negative; and what mitigating measures the World bank and IMF have agreed to in order to support in such instances. [67771]
§ Clare ShortOver recent months the British Government have pressed both the World bank and IMF for a timetable of poverty and social impact analysis (PSIA), setting out the policy reforms that need to be analysed and who will support countries to do the analysis. We welcome the commitment of both institutions to PSIA. We have also supported PSIA pilots in six countries in order to demonstrate how it can be carried out.
Of the 35 IMF Poverty Reduction and Growth Facility (PRGF)-supported programmes considered by the IMF Board between I July 2000 and 30 September 2001, IMF staff papers show that roughly 60 per cent. include some form of PSIA—though only around a third of PRGF-supported programmes had full studies undertaken to assess the effects of specific policies (`formal' PSIA).
Figures are not available on the number of instances in which PSIA has shown IMF structural reforms to have been negative. However around two thirds of PRGFsupported programmes over the period included some measures aimed to offset potentially adverse short-term effects of either macroeconomic reforms, structural reforms or exogenous shocks on the poor. There is also evidence of PSIA influencing the design of economic policies. Examples include Uganda, where plans to liberalise the sugar industry were changed; Senegal. where 15–20 per cent. diesel and kerosene subsidies were maintained rather than eliminated; and Cambodia, where large-scale retrenchment of civil servants was delayed until safety nets for retrenchees could be put in place.
The World bank have made similar commitments to use PSIA in their Poverty Reduction Support Credits. The British Government see all these documents, given our membership of the World Bank Board. IMF and World bank reviews of PRGFs and Poverty Reduction Strategies respectively contain further information on PSIA. These can be found at www.imf.org and www.wordbank.org.