Global Policy Forum

World Development Report 2004

World Development Report 2004 says poor must be put at center of service provision (download the full report)

The World Bank today released its annual World Development Report, which addresses why government services fail poor people and how they can be improved. Drawing on successful examples from around the globe, the report recommends putting poor people at the center of the provision of basic services such as health, education, water and electricity.

These services often fail the poor—in access, in quantity, in quality—but there are examples where they do work. A common feature among stories of successful service delivery is that poor people are empowered, according to the World Development Report 2004: Making Services Work for Poor People (WDR). That means the poor can monitor and discipline service providers. They can influence policymakers, for example through the ballot box. And, incentive structures exist for providers: effective service delivery is rewarded while ineffective performance is penalized. "What the report shows us is that we have learned a great deal about what is involved in making services work for poor people," World Bank Chief Economist Nick Stern told reporters in Dubai for the World Bank-IMF Annual Meetings. "There have been failures, but we've learned a lot from the successes, as well as from the failures, and the evidence is set out carefully and systematically in the World Development Report."

Without such improvements in services, freedom from illness and freedom from illiteracy—two of the most important ways poor people can escape poverty—will remain elusive to many. Inadequate service provision also imperils a set of development targets known as the Millennium Development Goals (MDGs) which call for a halving of the global incidence of poverty and broad improvements in human development by 2015.

The report comes at a time when rich countries have pledged to increase foreign aid and poor countries have pledged to improve their policies and institutions to try to reach the MDGs. "The WDR is of crucial importance to the arguments concerning where we now stand on accelerating development and making progress towards some Millennium Development Goals," Stern said. "We're not credible in asking for extra resources, if we cannot also show how those resources can be used well."

Shanta Devarajan, Director of the World Development Report 2004 and Chief Economist in the World Bank's Human Development Network, noted three common features in successful examples of service delivery. "One is to give them the ability to monitor, encourage and, where necessary, discipline service providers," he said. "The other is to raise their voice in policymaking. And finally, to give incentives to service providers to serve poor people."

School voucher schemes”such as a program for poor families in Colombia, or a girls' scholarship program in Bangladesh (which paid schools based on the number of girls they enrolled)—increase clients' power over providers, and substantially increased enrollment rates.

In Bangalore, India, poor people forced politicians to improve services after public surveys revealed how the quality of the water, health, education and transport services they were receiving compared to neighboring districts. In the aftermath of a civil war in Cambodia, the government paid primary health providers in two districts based on the health of the households (as measured by independent surveys) in their district. Health indicators, as well as use by the poor, in those districts improved relative to other districts.

Jean-Louis Sarbib, the World Bank's outgoing Vice President for the Middle East and North Africa, said that region is rife with evidence of what the World Development Report documents. From water associations improving irrigation in Egypt to parents encouraging education reform in Yemen, "people have a sense of responsibility for what happens," said Sarbib, who is now Senior Vice President of the Human Development Network.