Monday, February 11, 2008

Money to the Poor not the answer

Daily Graphic, Monday, February 11, 2008. Page 7 (Features)

Voice from Afar-K. B. Asante

Grinding Poverty diminishes man. It is an affront to humanity. It defeats the objects of creation. Man -as well as woman- is not an animal. It is therefore a primary duty of leaders world-wide to uproot poverty and uphold the dignity of man.

Governments of Ghana, especially the present one, have been greatly concerned about levels of poverty in the country and have made efforts to eradicate or alleviate it. The present Livelihood Empowerment Against Poverty (LEAP) programme is an example of a measure with good intentions but questionable prospects of success.

If I understand the strategy, the government would pay money to extremely poor Ghanaian households. The aim is to relieve fellow citizens who find themselves in the category of extremely poor, vulnerable and excluded.

Implementation of this scheme would be difficult. However to me, the basic flaw is the philosophy and the message. I know of no political philosophy which holds that you can assist fisherman by giving them fish and not fishing nets as well as technology to mend their nets and if possible make them themselves. My capitalist free-market friends used to tease me about our socialist plans which rob the people of initiative, self-help and self-confidence.

I find it strange that our government, which is not socialist, has come up with the LEAP scheme, which appears to encourage the disadvantage to believe in manna from heaven without any effort on their part.

Governments of Ghana have executed many schemes to encourage the people to help themselves and thereby assist in economic growth. The results have not all been encouraging.

Two examples will illustrate the dilemma face by governments of Ghana. I have always been interested in cocoa affairs ever since I supported the creation of the Cocoa Marketing Board in the ‘50s against the stricture of right-winged politicians and academics like Lord Bauer. It was therefore a privilege when I led the Ghana delegation to negotiations, which led to the International Cocoa Agreement in 1972.

My interest in cocoa continued when I later became a director of the Cocoa Marketing Board. I gave strong support to the chairman, the late Prof. Sey, in his efforts to rid cocoa-growing areas of unnecessary poverty. Infrastructure was improved and loans were given to cocoa farmers to improve their productivity.

To my surprise, at a board meeting in 1975 or thereabouts, it was proposed that loans of about US$1.5 million in value should be written off. There were many reasons. One was corruption. Loans to people like Kwesi Mensah, near the mango tree at Adukrom, could not obviously have been recovered.

I came across another case of bad loans recently. The government has for the past five years been giving loans to organisations through the micro-credit disbursement scheme. The loans were to improvement economic well-being. The specific nature of the loan is shown by the ministries processing the loans. They include the Ministries of Women and Children Affairs, Agriculture, Manpower and Development, and Fisheries. Of the GH¢ 137,000.00 loans granted only GH¢ 39,000 has been repaid. And the payment date has expired or is to expire shortly. What does the government do in the face of this personal experience and that of other governments?

Obviously it should find out why the loans were not paid and take appropriate action. Meanwhile, it should consider other measures to deal with the nagging problems of poverty.

Such other measures should certainly not include the release of GH¢ 21,000 for the payment of grants to 2,000 households. The size of the amount is immaterial. It is money down the drain and it gives the wrong signal.

Poverty should be alleviated by putting able-bodied poor into employment. This means we should take vigorous measures to make the economy grow. There are people in India who are poorer then the poor in Ghana. However, with the economic growth of eight per cent and more India can take real measures to assist her poor. The same is true of China. The Chinese are facing facts and do no allow ideology to frustrate strategies for economic growth.

Why do we allow so-called free market policies which are not practised by any independent country in times of crisis to force us to adopt sentimental policies towards the poor, which even socialists will find ridiculous?

We should not offend the poor. They know what dignity means. The money we dole out should be used to procure, for example, the easily available material to enable them to make Bolgatanga baskets for local use and exports. The money used to train the poor, set them to work and to provide the necessary logistics such as transportation would be money well spent. It would eventually pay for itself and help the economy grow. The same can be said of other “cottage” industries. Those engaged in shea butter productions in the north, for example, should be helped.

These are only examples of what can be done for the poor and for those in partial employment. The ideologues will argue that that is not the job of the government, it is for entrepreneurs. Do they means the potential entrepreneurs who are imprisoned by poverty? Does it make sense to engage our highly trained manpower to design plans to manage disbursement, contain corruption, measure and assess impact instead of doing something positive to assist the poor to feed, clothe and house themselves?

We should think again about LEAP. We cannot by such measures make the poor leap up as a hart. It is more worthy to leap out themselves. We should tarry a little before we leap into the dark of darkness.

No comments: