Equity in development: Why it is important and how to achieve it

Working and discussion papers
November 2009
Harry Jones

There is a growing recognition of the importance of equity to development, and many development agencies recognise equity as a central goal for their programming. However, while equity is used intuitively in development debates and programming, it seems that its meaning is not clearly understood. This is reflected in often shallow analysis about what equity is and what should be done to achieve it. Its importance is recognised, but the policy priorities for achieving it are not consistently or coherently explored.

Recent decades have seen rising inequality and inequities, which are in turn partly responsible for the world ‘lagging behind’ on headline goals such as the Millennium Development Goals (MDGs). While this rise may be driven largely by worldwide processes such as globalisation and economic integration, more than by government or donor policies, rising inequity is a problem that can and should be tackled by the development community, and should be more firmly on the agenda. This paper draws together the current understanding on why it is important, and how to tackle it.

The problem
Equity comes from the idea of moral equality, that people should be treated as equals. Thinking about equity can help us decide how to distribute goods and services across society, holding the state responsible for its influence over how goods and services are distributed in a society, and using this influence to ensure fair treatment for all citizens. Applying these ideas in a specific country context involves hard choices, and embedding discussions of distributive justice into domestic political and policy debates is central to national development, but three areas of considerable consensus can be identified. In order of priority, these are:

1. Equal life chances: There should be no differences in outcomes based on factors for which people cannot be held responsible.
2. Equal concern for people’s needs: Some goods and services are necessities, and should be distributed according solely to the level of need.
3. Meritocracy: Positions in society and rewards should reflect differences in effort and ability, based on fair competition.

Unfortunately, there is considerable inequity in developing countries. People’s access to and interaction with key institutions are shaped by power balances in the political, economic and social spheres, often leading to adverse incorporation and social exclusion. Also, patterns of inequality reinforce each other through intergenerational transmission and various formal and informal institutions, resulting in inequality between groups and geographical regions and chronic poverty passed between generations. The available evidence on the scale of the challenge confirms a worrying picture of life chances dependent on inherited circumstances and inequitable access to services, as well as rising income inequality which may further entrench disadvantage. As well as being a bad thing in itself, this inequity has a negative effect on growth, poverty reduction, social cohesion and voice.

The solutions
Taking equity as a guiding principle brings into focus particular areas of policy. These are existing and emerging areas of policy, but they gain a new importance from an equity perspective. The five core priorities for addressing equity at the national level are:

1. Providing universal public services for fair treatment. This means prioritising universal access to public services, such as health and education, and improving their quality by improving their delivery and strengthening underlying institutions. Infrastructure and law and order are also crucial. Services should be free at the point of delivery wherever possible, and where this is not possible, arrangements should be made to ensure that poor people are not excluded.
2. Targeted action for disadvantaged groups. Government expenditure should favour disadvantaged regions or groups. Quotas can support access to employment for specific excluded groups. Services targeted towards these groups are crucial (e.g. girls’ education), as is providing assistance at key stages of development, such as early childhood. Empowering these groups is also vital, as well as strengthening organisations such as producer organisations, social movements and trade unions.
3. Social protection. Social protection should be provided to ensure that nobody drops below a minimum level of wellbeing, beyond which unmet need will create cycles of disadvantage. Options include: payments such as social insurance or basic income grants; conditional transfers to promote human development; minimum wage policies; guaranteed government employment programmes; and labour market regulations to those in employment.
4. Redistribution. ‘Downstream’ action is required to improve equity by reducing inequality. Progressive taxation can help, if the additional fiscal space created is used to fund interventions that will support equity. Other priorities include lowering taxes on staple goods and applying taxes on property – inheritance taxes are key. Land reform is also crucial and redistribution may be required to provide the poor with productive assets.
5. Challenging embedded power imbalances. Power relations can cause and sustain inequity. Tackling harmful power relations takes time, and the empowerment of disadvantaged people must be combined with improving accountability mechanisms and reforming democratic institutions. It is important to build a vibrant civil society and an independent media. Addressing unhelpful attitudes and beliefs can also help foster social cohesion and build a pro-equity social contract.

There are a number of challenges and obstacles to implementing pro-equity policies, many of which themselves stem from inequities. In light of this, development agencies have a special role: by virtue of being external actors they may have more room for manoeuvre to help equalise life chances. To deliver on equity, agencies should incorporate a more systematic understanding of equity and inequity into their policy decisions, implement pro-equity policies and influence developing country governments to address inequity. More than this, equity should be embedded in decision-making tools and procedures.

The payoff
The interventions listed above have had a proven impact on poverty, inequity and human development indicators. More than this, some developing countries (e.g. Vietnam) have employed wide-ranging and coherent strategies to tackle inequity, which have promoted long-term and sustainable change in terms of growth as well as reducing poverty and inequality. Tackling inequity is crucial for developing country governments and development agencies: as well as being a valuable goal in itself, improving equity constitutes a central place in our understanding of beneficial change and development, driving poverty reduction in combination with growth. Moreover, the empirical evidence indicates that equity is instrumentally central to long-term change, through its causal ties to efficiency, growth, poverty reduction and social cohesion.

Putting equity at the heart of development programming could potentially have further benefits. As well as adding practical value, the symbolic, normative and political dimensions of the concept promote the recognition of key challenges, resonate with stakeholders North and South, foster empowerment and engagement and promote deeper, more sustainable change.

The political will?
Equity is central to development. There is a broad and deep understanding of inequity and its causes, and on what works and what does not. Yet, equity remains low on the policy agenda in many countries. This must be down to a lack of political will. We can only conclude that the limited focus on equity is a matter of domestic and international power imbalances. Tackling inequities often requires working against the interests of national elites, challenging vested interests or dominant ideologies, or speaking for people who are excluded and ignored systematically by those making policy.

As a result, the biggest challenge for promoting equity in developing countries is to address the political economy of change. It is crucial to strengthen political movements and coalitions, to challenge prevailing beliefs and misconceptions around equity, and to encourage a representative public debate on practical issues of distributive justice.

While many developing countries do not need to wait for the development community to get its act together on equity issues, donors can play a crucial role in influencing development debates and in promoting equity through programme design and policy influence. Because donors are separate from national power structures that may reinforce social, political and economic inequalities they can also have a disproportionate influence. While some agencies (mostly INGOs such as ActionAid and Oxfam, but also SIDA) do give equity considerable attention in their analysis, policy and practice, others portray equity related issues as overly ‘political’. Where policy discourses draw on neo-liberal visions of development, principles such as equality of opportunity may be seen as important, but there may be ideological barriers to putting this agenda into operational. Donor agencies need to focus more strongly on transforming an equity-focused agenda into tangible action for the poor, backed by political will at the top levels.