"IMF policies have led to excessively low wage bill ceilings at the very same time that the World Bank and other donors are pushing poor countries to rapidly expand enrolments, so as to achieve the Millennium Development Goal (MDG) of getting all children into primary school by 2015," pointed out the report by development agency, Action Aid.
In countries where the IMF does not impose restrictions on the wage bill, such as Mozambique, it limits the size of the government budget to achieve single-digit inflation rates, said the study.
"IMF's obsession with low inflation targets is constraining developing countries' public spending which is critical for attaining the UN MDGs," said Jack Jones Zulu, a researcher with the think-tank Southern Africa Regional Poverty Network. "Poor countries have to increase public spending to tackle development such as hire more teachers to improve education, expand health facilities or tackle HIV/AIDS".
Action Aid, which conducted case studies in Malawi and Mozambique, found the countries had abolished tuition fees in primary schools to achieve universal enrolment. "Yet, teacher recruitment and training has not been able to keep up. Getting more children into primary school without a corresponding effort to employ more trained teachers does not fulfill their right to education".
The development NGO urged the IMF not to attach specific conditions to its programmes, but rather provide various options on controlling spending keeping the country's long-term policy plans in mind. "Regrettably, our case studies indicate that governments are given neither the policy space nor the technical support to determine for themselves the most appropriate macroeconomic policies to promote equitable growth and achieve national education goals".
It found civil society is not involved in discussions surrounding macroeconomic policy, as a result, such policies continue to be "divorced from the reality on the ground, failing to take into account the persisting teacher shortage and its devastating impact on the quality of education".
According to the United Nations Educational, Scientific and Cultural Organisation (UNESCO), to get children into the ideal class sizes of less than 40, sub-Saharan Africa, which currently has 2.4 million teachers, will need to increase the number by 68% to four million teachers by 2015.
In Malawi, where the current class size is as large as 72 children per teacher, the government will have to almost double the number of existing teachers to more than 90,000 to reach the ideal teacher/student ratio of 40 children per teacher, found the Action Aid study. Although Mozambique was allowed to raise its wage bill, "with the IMF's consent it continues to constrain teacher recruitment" and would need to hire more than 100,000 teachers to achieve the ideal class size.
In response to the Action Aid study, the IMF said it was flexible about public sector spending. It had allowed Zambia to hire additional health and education staff and pointed out that even Malawi's ceiling adjusts automatically for donor-funded health expenditure. The global lending body argued that "wage bill ceilings can be necessary in the short-term when the public sector wage bill has led to macroeconomic imbalances due to unplanned, excess spending and poor expenditure control".
"No one is saying a high inflation rate is good for anyone's economy, but a balance has to be struck between public spending to tackle poverty reduction goals and maintaining appropriate levels of inflation", said Zulu. "You cannot prescribe to Malawi or Zambia that, 'look Britain is not increasing its public spending, so you must not either'."
The Action Aid study, Confronting the Contradictions: The IMF, wage bill caps and the case for teachers, reported that the IMF and government representatives had also argued that many other factors were to blame for the lack of enough teachers in the classrooms. These included skewed staff deployment, ghost teachers inflating the payroll, skills shortages, a failure to train enough teachers, and the lack of predictable donor aid.
But the NGO argued the "solutions will require more investment, not less – for example in building more teacher training colleges or providing incentives for rural postings (thus increasing the wage bill)".
The Action Aid study also found it difficult to accept the IMF argument that increasing the wage bill would impact on inflation. "It was universally stated – by the IMF and government alike – that the main drivers for inflation are weather shocks, such as droughts, which damage agricultural production, or oil price hikes. In Mozambique, while the wage bill did increase in 2003, it was noted that the main reason the country failed to meet the 10.8% inflation target was due to a rise in food prices as a result of the drought the previous year".
The development agency also called on donors to help finance the gap needed to help the developing world achieve the education MDG.
Article by courtesy of IRIN
