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					  Talking Points on

Enhancing Trade Union Participation in PRSPs
               in East Africa

                                 Lawrence Egulu

TMLC, Kisumu, December 9, 2005
Background to PRSPs (1)
   Many developing and transition countries sought external financial
    assistance from the IMF and the World Bank to pursue stabilization
    and structural adjustment programs.
   These programs involved limiting the growth of government budget
    deficit to levels that could be sustained by foreign and non-
    inflationary domestic financing, budget rationalization through
    containing public sector employment, liberalization of labour, money
    and capital markets, and maintenance of an “appropriate” exchange
    rate policy.
   These objectives normally entailed price reforms, removal of
    subsidies, foreign exchange and internal and external trade
    liberalization, introduction of "cost sharing" for government-supplied
    services, privatization, restructuring of government institutions, and
    legal reforms aimed at providing an "enabling environment".
Background to PRSPs (2)
   By the 1990s it was clear that the SAPs had failed to
    address fundamental structural problems and there
    were difficulties in demonstrating an automatic
    relationship between neo-liberal policies and increased
    well-being for the people.
   With increasing loss of credibility in their policies, the
    World Bank and the IMF thought out how to remodel
    their SAPs.
Policy Shift by the BWIs?
   After more than two decades of supporting SAPs, in
    major policy shift on September 9, 1999, the
    Bretton-Woods Institutions recognized “the
    increasing evidence that entrenched poverty and
    lack of economic opportunities and asset
    endowments can themselves be impediments to
   They announced a new framework to govern their
    lending and debt relief activities that would put
    poverty at the centre of their relations with low and
    middle-income countries.
…hence birth of PRSPs
   With poverty as the central target, recipient countries would be
    expected to formulate Poverty Reduction Strategy Papers
   PRSPs would therefore measure poverty in the country, identify
    goals for reducing poverty, and create a spending and policy
    program for reaching those goals.
   Country-owned poverty reduction strategies would provide the
    basis of all World Bank and IMF concessional lending and should
    guide the use of resources freed by debt relief under the
    enhanced HIPC Initiative to the approximately 81 International
    Development Association (IDA) borrowing countries.
Governments in Charge?
   A significant dimension would be that the
    governments would be “in the driver’s seat”
   Governments (in consultative processes that
    transcend the realms of government
    agencies and line ministries) would be
    responsible for the production of the PRS, in
    close association with the external
    development partners, civil society and the
    private sector, in line with the Comprehensive
    Development Framework (CDF).
PRSPs would be holistic
   The PRSP would ensure that a country’s
    macroeconomic, structural and social policies
    are consistent with the goals of poverty
    reduction and social development.
   PRSPs would be updated every three years
    with annual progress reports.
Just change in names?
   The PRSP replaced the World Bank’s SAP-
    era Policy Framework Paper (PFP) as an
    overarching document that outlines policy
    directions and resource allocation
   The IMF’s lending facility for poor countries,
    the Enhanced Structural Adjustment Facility
    (ESAF), was subsequently renamed the
    Poverty Reduction and Growth Facility
Or the death of the
Washington Consensus?
   First coined by J. Williamson, the ten
    elements of the Washington Consensus
    are: fiscal discipline; redirection of public
    expenditures; tax reform; liberalization of
    interest rates; trade liberalization; a
    competitive exchange rate; liberalization of
    capital flows; privatization; deregulation; and
    secure property rights.
   Would the PRSP process lead to
    abandonment of these principles?
ICFTU Response to the PRSP approach

   The ICFTU’s agenda for participation is premised on the
    following aspirations:
       the PRSP process provides a forum where workers as citizens have the right
        to be part of economic decision-making in their countries;
       workers’ interests can best be articulated by unions themselves;
       they can ensure that the respect for fundamental labor rights, decent work,
        and environmental standards must be key elements are incorporated in the
        national poverty reduction strategy;
       since their actions – higher wages, better working conditions, and more
        secure jobs – help lift low-wage workers out of poverty, these should
        become part of any poverty reductions plan;
       unions help reduce poverty and inequality;
       many IMF and World Bank-supported policies such as privatization schemes
        and pension reforms, directly affect union members and workers in general
WCL and GUFs Response
   The World Confederation of Labour (WCL)
    welcomed the intention of the IMF and the
    World Bank to focus on poverty reduction and
   UNI, the main confederation of service
    workers, said “PRSP framework offers a
    unique opportunity for trade unions in
    developing countries to influence the path of
    development that their country pursues.”
However Concerns with
PRSPs set in
   Lack of freedom of association
   It remains at the discretion of government to
    invite CSOs that they can do business with
   Governments are self-censoring based on
    their perception of what the IFIs would find
   The PRS pay inadequate attention to labor
    market and trade union concerns in general
PRSPs to date
                                               Determination                                    sness
on                                              As long as one is healthy,                                  There is a
            Because we              thinks properly for the family, is able to                  feeling of
do not know where the               travel to do business, can cultivate land,                  powerlessness to
market is ….who                     construct a shelter and work harder..                       influence things around
readily accept because                                                                          you – What can I do - a
of ignorance … and
lack of alternatives                                                                            poor man does nothing

                                                                                                      Without pride
                                                                                                   Some of us (youth)
                                                                                        give sexual favors to older
                                                                                        women in return for money
     I will continue carrying
     firewood until blood comes
     out of my head.

                 Voiceless                                                                      We are not happy if
                  A poor person                                                      we are not staying with our
     does not have a voice in the                                                    mothers
     community. …No one will                           Child’s drawing,
     listen to them.                                   Kampala
                                                                                                       Having no relatives
                                                                                           is a hopeless state of life.

                                         Resignation to their
                                    situation                                                   Helpless
                                         Factors beyond our control                             If I fall sick, I just stay
                                                                                   like that, like a dog

                                                                                I do not go to church
                                                                     because I do not have a dress to
                                                                     put on
Any major policy changes by
   The PRSP process has no doubt enhanced the role of various
    actors in economic decision-making in a number of countries.
   However, true ownership of the policy documents is doubtful as the
    Washington-based international financing institutions (IFIs) still have a
    dominant role in the process.
   Debates on the macroeconomic frameworks, particularly alternative
    growth scenarios, are not opened up.
   The PRSP deliberations are frequently rushed for the sake of
    enabling a country to qualify for debt relief under the HIPC Initiative.
   In terms of content, much emphasis is still placed on the same SAP-
    like conditionalities, with employment policies, for instance, not
    being prominent in a number of PRSPs.
PRS Evaluation (1)
   In July 2004, World Bank’s Operations
    Evaluation Department (OED) and the IMF’s
    Independent Evaluation Office (IEO)
    separately evaluated the PRS Initiative.
   The World Bank report notes that, “The
    perception of ownership varies among
    stakeholders …Countries have focused more
    on completing documents, which give them
    access to resources, than on improving
    domestic processes”.
PRS Evaluation (2)
   The IMF’s Report on the Evaluation of PRSPs and the PRGF,
    July 2004 recognizes that “participation in the formulation of
    PRSPs was generally more broadly based than in previous
    approaches, and most stakeholders involved in the process
    viewed this as a significant improvement”.
   It is also concerned that “the PRS process has had limited impact
    in generating meaningful discussions, outside the narrow official
    circle, of alternative policy options with respect to the
    macroeconomic framework and macro-relevant structural
What Unions have to do to ensure Effective
Participation (1)

     Pre-participation stage
         At the onset the union should determine its goal in the PRSP process
          – i.e. what does the union hope to achieve from participating in the
          PRSP process
             Is it for publicity’s sake?
             To be heard and be treated as an important player in national
             To ensure that participation/social dialogue is institutionalized?
             To fight privatization?

         Determine how much of a priority participation in the PRSP process
             Are you doing it simply because others are doing so?
             Is it because it is the “fashion” of the day?
What Unions have to do to ensure Effective
Participation (2)

         At what stage is the country in the PRSP process?
         Download any documents for public consumption on
          the web or ask for them from the government, BWIs.
         Have you read the PRSP Source Book at

          htm ?
               There are 4 major stakeholder groups of which unions
                are a sub-set of CSOs!
     Preparing a checklist of union “demands”
         Determine how much you are ready to concede –
          what will determine the level of success or failure?
What Unions have to do to ensure Effective
Participation (3)

        Should you be limited to only labor related issues?
              Wages
              Employment
              Labor standards
              Corporate social responsibility
              Occupational health and safety
              HIV/AIDS at the workplace
              Pensions/social security reforms
              Labor law changes
              Informal sector policies
              Public works schemes
What Unions have to do to ensure Effective
Participation (4)

        OR do you go “Beyond Labor”?
              Macroeconomic issues
              Poverty diagnostics
              Capital markets
              Agriculture
              Trade
              Micro finance
              Human resource development
              Education and training
              Social Protection
              Health
              Energy
              Transport
              Water
              ICT
              Mining
              Cross cutting issues: Gender, environment, participation, governance
What Unions have to do to ensure Effective
Participation (5)

         Determine the use of resources to follow up the PRSP discussions
             Time
             Personnel/knowledge/skills
            o Do you have alternative researched proposals well written down to
              support your arguments?
             Money matters

     Getting on board
         What other organizations/agencies are on board already?
         Have you been invited?
         If not, have you notified the government, WB, IMF, ILO, ICFTU?
         Any follow up turned down?
         Publicity and awareness raising!
What Unions have to do to ensure Effective
Participation (6)

     Once on board, how do you ensure effective
         Have you widely circulated your position papers?
         Do you want to be treated exclusively or together with
          other CSOs?
         Reaching out to other CSOs?
         Ensure that other CSOs also articulate your views
         Participation in what thematic groups?
         Mechanisms for follow up on discussion, proposals,
What Unions have to do to ensure Effective
Participation (7)

     If your views don’t get through 100%
       It’s a bargaining issue!
       Do a self evaluation and assess what you did and what you
         didn’t do.
       If the omissions were really deliberate, let the IMF, WB,
         ICFTU, ILO know your objections
       Write a thorough critique – with alternative proposals!

     Beyond the PRSP Document
       What areas in the PRSP can you implement, monitor and
       You have to be specific and clear on what you wish to
WB Study on TU Participation in the PRS

   This is a summary of a 10-month World Bank study
    (January to October 2003) - highlighting the
    synergies and gaps with regard to the union
    participation in the PRSP process in 23 countries
   The study is titled “Trade Union Participation in
    the PRSP Process”, Social Protection Discussion
    Paper Series No. 0417
   A summary is online at in English, French
    and Spanish
23 Countries studied
   Benin, Kenya, Democratic Republic of the
    Congo, Ethiopia, Ghana, Malawi, Senegal,
    Tanzania, Uganda and Zambia
   Cambodia, Indonesia and Mongolia

   Albania, Bosnia & Herzegovina and Georgia

   Bolivia, Honduras, Guyana and Nicaragua

   Bangladesh, Pakistan and Sri Lanka
Main findings
Different levels and stages of union participation
in the PRSP process

       Some have participated from the inception stages;
        while others were invited when the process was
       There are cases where unions were totally left out
        (Uganda, DRC, Tanzania)
       No union incorporated in the PRSP drafting
       None in program implementation, M&E
       In Uganda and Tanzania, unions have been involved
        in the second generation PRSPs
Shallow and ill-prepared consultation deter
effective union engagement

        Delayed delivery of documents, language
         constraints, and late notice for meetings
         o   CSA ( Benin) invited to only 2 meetings/sessions
         o   Sri Lanka’s NWC invited to “two seminars and some
             consultation meetings”
         o   In Bangladesh, unions were invited to the two-hour kick-
             off informational meeting when the PRSP process was
             entering it's drafting stage
         o    The reason the CNTS (Senegal) did not make a written
             submission was because “the information time frames
             were rather short”
In countries where more than one national trade
union federation exists, some unions did not

         In cases of union pluralism, participation was
          often limited to the most representative (or the
          official unions)
          o   In Indonesia the workers’ place is occupied by the KSPSI
          o   In Sri Lanka some 72 trade unions joined the Alliance for the
              Protection of National Resources and Human Rights
              (ANRHR), a network of CSOs, in rejecting the PRSP
          o   In Albania, the KSSH and not the BSPSh was invited
          o   In Malawi, the MCTU and not the COMATU participated
Unions remain skeptical of Bank and Fund

     Dominance of macroeconomic issues and other SAP-
      like conditionalities
       “The PRGF is itself a new name for an old
          program…” – Ghana TUC
       “It was the desire to access funds rather than the
          interests of the people of Honduras that led to the
          formulation of the PRSP” - CGT –Honduras
       Debates on macroeconomic issues have never
          been opened to other stakeholders
         o   The UNSAS of Senegal boycotted the PRSP because “the
             draft paper was lacking a social dimension and was only
             dealing with macroeconomics”
Lack of capacity within unions remains a major

         Unions lack technical personnel due to the costs of
          hiring and maintaining such high caliber staff
         Most do not have the financial resources to do
          research and elaborate alternative development
With adequate capacity within unions and/or involvement of
the ILO, there is stronger coverage of labor market issues
in the PRSPs

          In general labor market interventions exist but are
           not central
          The ILO (2003) shares similar views and attribute
           the meager coverage of decent work issues to the
           general absence of labor ministries and other social
          Some papers do highlight labor market
Unions are not solely preoccupied with “bread and
butter” issues

     In Sri Lanka the NWC submitted text detailed
      views on public health, education, nutrition,
      water supply, sanitation and social protection
         In BiH, the unions called on the authorities to
          expedite the privatization of banks
         In Ghana, the macroeconomic framework, equity,
          taxation, agriculture and investments were all
          included in the TUC document
Trade unions in many developing countries lack
firm ties with CSOs and do not often identify with

         Trade union/CSO relations evolving
         ”…few trade unions and employers’ organizations
          identify themselves with this relatively new all-
          embracing term. Furthermore other CSOs
          sometimes do not think of unions and employers’
          organizations as part of their movement” – ILO
         Trade unionists see themselves as belonging to
          representative, democratic and accountable
          organizations – virtues they don’t always attribute
          to other CSOs
         In some countries union/CSO collaboration is more
Implications for TUs

     Prioritizing “participation in the PRSP process”
     Strengthening union capacity building programs
     Resources for organizing meetings, sensitizing their
      members, carrying out research, disseminate their
      views/findings, and preparing detailed policy alternatives
      to submit during the PRSP formulation process
     Taking on other developmental roles
     Demonstrate the developmental and poverty-reducing
      role of employment and international labor standards
     Working with other likeminded CSOs
Implications for Governments

     Poverty reducing employment policies - reach out to the
      unions and the ILO (more structured participatory
     Opening up the debate on macroeconomic issues
     Adequate notice and timely delivery of documents
     Consultations to take place at I-PRSP level
     Inclusion of unions in PRSP implementation, monitoring
      and evaluation
Implications for the World Bank and the

     Maintain on-going IFI/TU dialogue
     As a policy consult with unions at national level on major
     More in-house training for Bank staff on working with
     More analytical work on the positive contribution of unions
      and core labor standards
     Expand capacity building programs for TUs
Potential World Bank Resources to TUs (1)

     Poverty Reduction Strategies Trust Fund (PRSTF)
        Multi-donor trust fund was set up to support capacity building in low
         income countries that are undertaking poverty reduction strategies
         set up in 2001
        Managed in-country by the World Bank, the United Nations, and the
         contributing donors
        All stakeholders involved in the poverty reduction strategy process
         are entitled to apply to the trust fund
        Activities that could be supported include capacity building to:
                Set up or institutionalize the participatory process;
                Improve poverty diagnostics;
                Improve public expenditure management systems;
                Improve the prioritization of public actions;
                Cost policies and programs;
                Undertake Poverty and Social Impact Analysis (PSIA);
                Analyze sources of growth;
                Establish monitoring and evaluation systems for the PRSP;
                Translate and disseminate PRSP documents.
        Link:
Potential World Bank Resources to TUs (2)

  The Small Grants Program
         Provides grants to CSOs through participating World Bank Country
         The Program focuses on civic engagement for the empowerment of
          marginalized and vulnerable groups
         The purpose of the Small Grants program is to support the empowerment
          of citizens to have greater ownership of development processes, thereby
          making these processes more inclusive and equitable
         Crucial ingredients for empowerment of vulnerable groups include:
            access to information
            access to organizational links outside the local domain
            capacity to influence the public arena and to negotiate with local and
             national authorities
            the existence of trustful national and local institutions, and
            the presence of enabling policy and legal frameworks for civic engagement.
         Link:
Potential World Bank Resources to TUs (3)

  Development Marketplace (DM)
     A program that promotes innovative development ideas
      through early stage seed funding
     It links social entrepreneurs with poverty fighting ideas to
      partners with resources to help implement their vision
     Since 1998, the Development Marketplace has awarded
      more than $14 million to over 200 groundbreaking
      projects through Global Competitions and Country
      Innovation Days.
     Link:
Contact Information (Kenya)

World Bank
      The World Bank
      P.O. Box 30577
      Nairobi, Kenya
      Hill Park Building
      Upper Hill Road
      Nairobi, Kenya
      TEL:(254-2) 260-300, 260-400
      FAX:(254-2) 260-380/381

   Mr. Jürgen Reitmaier
   Senior Resident Representative in Kenya
   Kenya RE Towers
   Upper Hill- off Ragati Road
Contact Information (Uganda)

The World Bank
  P.O. Box 4463
  Kampala, Uganda
  TEL:(256-41) 230-094, 232-533
  FAX:(256-41) 230-092

  Mr. Peter Allum
  Senior Resident Representative
  Tel: 256 (0)41 250-410
Contact Information (Tanzania)

The World Bank
    P.O. Box 2054
    Dar-es-Salaam, Tanzania
    Samora Avenue
    Dar-es-Salaam, Tanzania
    TEL:(255-51) 36410, 38355
    FAX:(255-51) 113039

The WB President
Mr. Paul Wolfowitz
President, The World Bank Group
1818 H Street, NW
Washington, DC 20433 USA
tel: (202) 473-1000
fax: (202) 477-6391
Contacting the IMF Managing
Mr. Rodrigo de Rato y Figaredo
Managing Director
International Monetary Fund
700 19th Street, N.W.
Washington, D.C. 20431
Tel: (202) 623-7000
Fax: (202) 623-4661
General inquiries:
    Tel: (202) 623-7300
    Fax: (202) 623-6278
Contact Information (Others)

Mr. Peter Bakvis
Global Unions - Washington Office
1925 K Street NW, suite 425
Washington, DC 20006
Phone: 202-463-8572
Fax: 202-463-8564