Exploring Crisis Response Policies through Macro-Micro Simulations

1. Exploring Crisis Response Policies through Macro-Micro Simulations Fourth International Policy Conference on the African Child 7th December, Addis Ababa Sarah Hague UNICEF Burkina Faso

2. Structure • Context • The analysis • The results • The impact of the study so far • What’s next…

3. Context • Policy context: rapid expansion in social service access; 3rd PRSP in development; move toward growth focus + equity and social protection? • Child monetary poverty higher than adults; • Economic context and crisis: expansion of deficit target; opening for social protection; Incidence of monetary poverty (2003 LSMS)

4. Significantprogress in budget availability • Substantial increases; • New policies to promote offer and demand; • Near to international objectives – 18% budget on education and 10% on health;

5. But spending per head is decreasing due to rapid demographic growth and expansion of enrolment;

6. The study: • Technical objectives; Simulate child welfare impacts of the global crisis and policy responses in Burkina Faso; • And policy objectives: Evidence base on child poverty and vulnerability impacts of crisis and policy options; • Policy options simulated: • Food subsidy (1% GDP from aid); • Cereal price subsidy (0.2% GDP from aid); • Cash transfer to poor children 0-14yrs (1% GDP from aid) • Cash transfer to all 0-5 yrs children (1% GDP from aid) • Cash transfer to poor children in 2 flooded regions (0.4% GDP from aid) • Cash transfer to poor children in 2 flooded regions (0.4% GDP from tax)

7. Impacts Export prices/demand National economy (CGE model) Import prices Input prices Employ-ment Producer prices Consumer prices FDI Foreign aid Household (micro models) Child welfare: monetary poverty, hunger, schooling, labor, health Remittances The model

8. Informingpolicy • Multisectoral Steering Committee with oversight of MEF; • Drafted alongside Action Plan for Tackling the Economic Crisis; • Innovative partnership for research; PEP network; International/national team; • Training workshop for national researchers; • Presentation of preliminary results globally; • IMF collaboration; fiscal deficit; • Making economic argument for investing in children – 5 point  in child mortality = 1 point  in GDP growth;

9. Results Impact on child poverty and labour • Impact of crisis and of policy options; • Equity of impact; poorer regions worse affected • (Sahel 7.4 point increase) ; and rural/urban gaps (5.1 increase versus 2.4);

10. Impacts on monetary poverty Food subsidies CRISIS Cash transfer

11. Impacts on caloric poverty Food subsidies Cash transfer CRISIS

12. Impacts on school attendance CRISIS Cash transfer Food subsidies

13. The impact of the study (so far) • Provided an evidence base; macro and micro; • Provided concrete entry point through its formulation and discussion of results; • Clear link between impact and policy; • Integration into global evidence base; workshops and WB/IMF Annual Meetings;

14. Bringing in new voices into national debate; • Supported joint UN dialogue; UNDP/UNICEF workshop; • Informed government policy : moving away from solely macroeconomic response; first govt policy to include social protection; central cross-cutting policy objective; integrated into new PRSP;

15. What next? • Consolidating results so far; feeding wider policy debate – National Social Protection Policy; • Replicating model; studying fiscal space and investments for children – IMF collaboration; • Asking hard questions about efficiency of spending: PETS; PER results; • Repositioning the poverty debate; emphasising extreme poverty; national coalition on poverty; • Stronger equity focus;

16. Thank you!