Leave No-One Behind in Financing for Development: Equity is about more than Dividends

Polly Meeks, ADD International/International Disability and Development Consortium[1]

Do a quick internet search for ‘Financing for Development Forum equity’, and you’ll find that most of the top results are sites on equity investment[2]not sites on ensuring equitable life chances for those who have historically been left behind.

Of course, this partly reflects the limitations of internet searches, and it would be unfair to say that social equity has been absent from recent negotiations on Financing for Development.

But there is a deeper point. With so many competing interests in the Financing for Development landscape, there is a risk that the voices of the poorest, and calls to align finance with sustainable development and human rights commitments, will be side-lined.

There were worrying signs of this in the negotiation of the FFD Forum outcome document. The Zero Draft of the document failed to mention equity, and only mentioned rights in the context of “intellectual property rights”. Subsequent drafts and negotiations did include leaving no-one behind and human rights in the context of social protection (paragraph 12 of the AAAA), the rule of law (paragraph 18 of AAAA) and gender equity (paragraph 21 of AAAA). But the final adopted draft failed to reach agreement on content.

If this pattern continues, future financing decisions may exacerbate, not alleviate, the inequities that world leaders committed to tackle at the Sustainable Development Summit in 2015.

Persons with disabilities are one group who have previously been left behind in development financing. Quantified data on the extent to which persons with disabilities benefit from financial flows is extremely scarce. But the World Bank and World Health Organisation recognises that a lack of finance is one reason why, on average, persons with disabilities are more likely to experience worse health outcomes, less education, and lower access to employment.

And the concerns of persons with disabilities illustrate the importance of applying a ‘leave no-one behind’ lens across the entire Financing for Development agenda. As the International Disability Alliance and International Disability and Development Consortium set out in their recent position paper, decisions on the quantity, quality and transparency of development finance all have profound implications for persons with disabilities.

Quantity of finance

Ensuring that persons with disabilities are not left behind requires dedicated resources – including resources for social protection, for fully inclusive public services, and for reasonable adjustments that enable access to employment and other opportunities. The importance of such financing is recognised by explicit references to disability in the Addis Ababa Action Agenda paragraphs 12, 16 and 78.

But where resources are scarce, persons with disabilities are often left till last. Take Uganda, for example, where the Government has drawn up a national policy on inclusive education, but the Ministry of Finance has said it does not have the funds to finance it (and this issue is far from unique to Uganda – but better documented there, due to a recent human rights reporting cycle).

Failure to allocate resources for persons with disabilities is, first and foremost, a matter of human rights. It is also a false economy: a growing body of evidence points to the long-term social and economic costs of exclusion of persons with disabilities.

This is why disability and development campaigners are calling for a progressive increase in dedicated domestic and international public finance to support the full inclusion of persons with disabilities in sustainable development. It is also why policies affecting the total quantity of development finance have special significance for persons with disabilities – from international tax cooperation; through the design of pro-poor taxation systems; to fulfillment of traditional donors’ commitments on Official Development Assistance. We strongly support the principles set out in Righting Finance’s recent toolkit linking tax and human rights, which says that for States to raise the “maximum available resources”, they need to ensure progressive tax systems, reduce tax incentives and tackle tax abuses.

We strongly hope that future stages of the FFD follow-up process, and especially the annual UN Financing for Development Forums, will advance new solutions to these critical issues, so as to maximise total resources available for sustainable development.

Quality of finance

Disability and development campaigners firmly agree with the CSO Financing for Development Group that there should be binding accountability mechanisms to ensure all development finance – in particular private finance – adheres to human rights standards. Internationally agreed commitments and principles, such as ILO Conventions, the ILO Multinational Enterprises Declaration, the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights, are all highly relevant for persons with disabilities. We call for mandatory compliance with internationally agreed standards on business and human rights, backed by effective redress processes that are fully inclusive of and accessible to persons with disabilities and other marginalised groups.

In addition, the UN Convention on the Rights of Persons with Disabilities has particular implications for high-quality development finance. Development financing decisions must take into account the multiple barriers that prevent persons with disabilities from benefitting equitably from sustainable development: whether through policies to tackle disability discrimination, or – as recognised in the Addis Ababa Action Agenda paragraphs 14 and 114 – through provision of accessible infrastructure and ICT.

Experience in Bangladesh, for example, demonstrates the importance of tackling these diverse barriers simultaneously: some of the most effective approaches to increasing employment among persons with disabilities have taken a multi-pronged approach, promoting equal opportunities policies among employers while also supporting practical adjustments to ensure access.

Transparency of finance

We strongly support calls for better data to monitor the implementation of sustainable development commitments, building on commitments in the Addis Ababa Action Agenda paragraph 126, but going further to ensure there is reliable data on both the quantity of financing and also its impact on sustainable development and human rights.

Historically, a lack of data on the quantity and quality of financing allocated for persons with disabilities has made it particularly hard to hold duty bearers to account. But this is just starting to change, and organisations such as the International Disability Alliance are pushing the boundaries of high-quality disability budget tracking, drawing on lessons from the longer-established field of gender budget analysis. Such analysis, harnessing the insights and experiences of persons with disabilities, should form a core part of the Financing for Development follow-up process. And it should be complemented by better official data on domestic and international resource flows for disability, which includes impact analysis in addition to actual earmarked resource flows.

Let’s hope that by 2019, when the UN General Assembly convenes to take stock of progress on the Financing for Development agenda, anybody who does an internet search on equity in the financing for development process will find a much richer range of data on both the quantity and quality of  financial flows for sustainable development and human rights. And let’s hope this data tells a positive story – that policymakers recognise financing can never achieve truly sustainable development while it leaves some people behind.

[1] This blog draws on earlier work by Alex Cote and Dr Rachele Tardi. It also benefitted from comments from Matti Kohonen.

[2] Equity investment is capital investment that does not create debt, but gives the investor a degree of ownership (and, in some contexts, the expectation of a financial return or dividend).