COVID-19

Changing terms of governance debate

by Shazzad Khan and Oliver Scanlan | Published: 00:01, Jun 06,2020 | Updated: 00:07, Jun 06,2020

 
 

A worker carries goods on a cargo boat in Dhaka on June 2. — Agence France-Presse/Munir uz Zaman

THE COVID-19 pandemic has triggered intense discussion on what is in store for Bangladesh, both during the emergency and in the new world that is to follow. Good governance is key to both issues, but it has largely not been prominent as yet in the substantial output of many think tanks and non-governmental organisations. This is a major gap. COVID-19 has laid bare the consequences of decades of bad governance: inadequate health care, a poorly educated population and social safety nets so threadbare that even if all of the relief earmarked for the people facing the threats of displacement and starvation reaches intended beneficiaries, it would still be insufficient.

Perhaps one reason we do not hear so much about good governance in discussions is the subject’s impenetrable use of lofty jargon: ‘accountability’, ‘participation’, ‘inclusiveness’, etc and the list is endless. Insufficient effort has been made to translate these concepts into reality that Bangladeshis would face in their daily lives. Nobel Laureate Abhijit Banerjee says that talking about the problems of the world without talking about accessible solutions is a way to paralysis rather than progress. A major problem with these abstract concepts is that of measurement. US business management guru Peter Drucker observes that ‘if you can’t measure it, you can’t improve it.’ But then, how do we measure governance?

The short answer is ‘indirectly’. Mechanisms like the World Bank’s Worldwide Governance Indicators and Transparency International’s Corruption Perception Index put a simple number next to an abstract concept to make it quantifiable. In the 2019 Corruption Perception Index,  Bangladesh scored 26 out of 100 while Denmark scored 87 and the World Bank Government Effectiveness Index, capturing policy implementation and public services delivery, ranked Bangladesh in the 21st percentile and Denmark in the 97th. No one would dispute that Bangladesh suffers from far higher levels of corruption than Denmark or that Denmark has world-beating public services and Bangladesh does not, but digging into the methodology behind these assessments still leaves us with little to act on. Both the indexes are complex composites of expert assessments and other rankings. They leave us with few pointers as to how to improve the situation.

One straightforward proposal is to expand the use of budget tracking as an advocacy tool to measure governance more broadly. Bangladesh’s GDP in 2019 was $300 billion, a source of national pride. Less encouraging was the size of the government budget relative to the GDP, $60 billion, while economists recommend a figure nearly twice as much, at least $110 billion. The result for the country is exactly what might be expected. Spending on education was equivalent to 2.1 per cent of the GDP compared with 6–7 per cent in Scandinavian countries. Investment in health is arguably worse with an equivalent of 0.89 per cent of the GDP against a WHO recommendation of 5–6 per cent. Social security expenditure totalled 2.6 per cent of the GDP compared with up to 19 per cent in Scandinavian countries.

This is not to imply an overly simplistic correlation between outcomes and expenditure; a careful work on inter-state comparisons in India shows that this is not the case. Tracking such outlays does, however, provide a more concrete view of governance in the country than the abstract formulations we now work with. It also directs our focus to that headline figure for public outlays versus national GDP and the vast problem of inequality it speaks of. According to the 2016 HEIS, Bangladesh’s Gini coefficient is 0.48 and 0.74 for income and wealth inequality. The wealthiest decile of the population control 45 per cent of the total national income and the bottom decile only 1.1 per cent.

The International Monetary Fund has repeatedly warned that an extreme inequality is bad for economic growth, not least because of its negative effects on governance. Pushing for annual public expenditures of $110 billion will entail a redistributive fiscal agenda, with more progressive taxation for at least 10 million citizens. Arguably, such redistribution was already necessary to increase sustainable economic growth and to achieve SDG 10. But COVID-19 has demonstrated how it is also necessary to build a truly resilient society.

The pandemic has painfully highlighted the weaknesses of our system, the result of decades of bad governance. Imagine how a much more resilient Bangladesh would have been in the face of COVID-19 emergency if education and health systems had been better resourced, with a strong social safety net to adequately protect the poorest against the most severe consequences of the economic shock. This imagined alternative present must become Bangladesh’s post-COVID future. In the context of a warming climate and continuing volatility in the international economic and political system, the only certainty is more uncertainty.

Securing such a future requires the wealthy within the Bangladeshi society to accept a permanent increase in the redistribution of their income and wealth to the state. The proposed alternative set of measurements for governance will be better able to assess our progress, refocusing our efforts on those variables that are the most tangible and, therefore, where improvement is straightforward to detect. If public expenditure as a percentage of national wealth, with spending on education, health and social security, is increased to levels equivalent to the recommended proportions of the GDP, the traditional ‘indirect’ governance indicators will look after themselves.

 

Dr Oliver Scanlan is a research fellow at the Centre for Sustainable Development, University of Liberal Arts Bangladesh. Shazzad Khan is a senior programme coordinator at Manusher Jonno Foundation.

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