Statistics Knowledge and Policy Antoine Simonpietri PARIS 21

Statistics, Knowledge and Policy Antoine Simonpietri PARIS 21 October 12, 2006

PARIS 21 The Partnership in statistics for development in the 21 st Century (PARIS 21) was established in November 1999 as a international partnership of policymakers, analysts and statisticians. PARIS 21 is served by a small secretariat hosted by the Development Cooperation Directorate of OECD in Paris, France.

PARIS 21 Objective § Promote a culture of evidence-based policy making (EBPM) in all countries, and especially in developing countries, § Improve effectiveness in reducing poverty and achieving the Millennium Development Goals (MDGs). § PARIS 21 helps to achieve this by stimulating more effective dialogue and greater demand, availability and use of better statistics. § PARIS 21 is focussing its efforts on assisting all low-income countries to design, implement, and monitor a National Strategy for the Development of Statistics (NSDS) by 2006 – with a view to starting to implement them by the following year and producing better national statistics by the time of the next Millennium review in 2010.

What does evidence-based policy-making mean ? Evidence-Based Policy-Making means that public policy decisions are informed by careful and rigorous analysis using sound and transparent data. Statistics are needed to: § § Analyze present situation and key issues Inform programme design and policy choice Monitor policy implementation Evaluate policy impact

Policy making and good statistics The production and dissemination of good statistics does not automatically lead directly to the adoption of a specific policy. This is because : § Different types of (equally sound) data may have different implications for policy. § Different types of analysis based on the same data can have different policy implications § There is no guarantee that a majority vote on a policy decision will be consistent with the evidence. Good statistics are a necessary but not a sufficient condition for EBPM.

Why is evidence-based policy-making desirable? In a democracy, EBPM is desirable: § To ensure the transparency of policy-making § To enhance the accountability of policy-makers

Transparency § Important on grounds of equity and efficiency § Equity: citizens have the right to know how and why decisions are taken which affect their lives. This is an essential part of good governance. § Efficiency provides private firms and households with some assurance when taking rational personal and business decisions – thereby promoting the efficiency of capital markets which in turn contributes to faster economic growth.

Accountability § Many types of accountability operate in a robust democracy. All require good data to be effective. § MPs are regularly accountable to the electorate § Executive branch of government is (in principle) accountable to MPs (legislature) § Senior civil servants accountable to Ministers § Junior civil servants accountable to senior civil servants § Between elections, the media and civil society organizations provide other mechanisms through which segments of the electorate hold the Government to account.

What are some alternatives to evidence-based policy -making ? § § § Power and influence of sectional interests Corruption Political ideology Arbitrariness Use of anecdotal evidence

Why the urgency to improve evidence-based policymaking ? § Need to track progress towards the MDGs and monitor advances towards the targets of Poverty Reduction Strategies in HIPCs in IDAeligible countries. § Rapid development of technically-sophisticated and data-demanding methods of policy analysis: § Wide range of microeconomic and macroeconomic models using quantitative data. § A variety of participatory techniques based on the collection of qualitative information.

Why the urgency to improve evidence-based policymaking ? § Costs of making faulty public policy decisions in the poorest countries have increased in recent years as a result of changes in the level and allocation of foreign aid. § Advances in ICT, such as the Internet, mobile telephony and FM radio stations, have weakened the control exercised by governments over the production and dissemination of information. This has led to a broader and more intense dialogue with the private sector and civil society.

Use of EBPM Analyze present situation and key issues § Assess key socio-economic problems and constraints § Evaluate existing policies with regard to these problems and constraints § Identify the disconnect between policy and reality

Use of EBPM Inform programme design and policy choice § Importance of spatial information: disaggregated poverty maps, satellite information on deforestation/ agriculture frontier § Empirical research shaped design of PROGRESA (Mexico): § Cash transfers paid to mothers § Larger grants paid to female pupils than to male pupils for secondary school

USE of EBPM Monitor Policy Implementation § Monitor key indicators to see if on-track § Failure to disclose monitoring information by policy-makers can make a bad situation worse

Use of EBPM Evaluate Policy Impact § Measuring policy impact is more methodologically and informationally demanding than monitoring policy implementation. § Evaluation involves attributing causation, which requires that the effects of a policy be isolated and quantified. This can only be done rigorously if an appropriate counterfactual is identified. § The ideal experimental context for an evaluation is where subjects are randomly assigned to treatment and control groups.

Use of EBPM § Random evaluation of PROGRESA undertaken by IFPRI which showed that the interventions had a significantly positive effect on human capital formation among children in target group. § PROGRESA extended to urban areas in 2001 -2002. § Delay in evaluation may lead to discontinuation of programme before results of evaluation are complete, e. g. . PACES in Colombia

How to promote evidence-based policy-making ? § Acknowledge and measure differences in statistical capacity among low income countries. § Develop a country typology to identify strategic priorities. § Elaborate a National Strategy for the Development of Statistics (NSDS)

What is a National Strategy for the Development of Statistics (NSDS)? § NSDS is a product and a process to ensure that better statistics and statistical analyses are available and used by national and international decision-makers and civil society. § An NSDS is a strategic approach to planning statistical capacity building across the entire national statistical system (NSS), encompassing data production, analysis and use, and all actors in the system, including line ministries. § An NSDS will provide a vision for where the NSS should be in five to ten years and provide a robust framework and action plan for building the statistical capacity to meet both current and future data needs. § The NSDS approach looks at statistical capacity building through a development and management lens; and looks at development policy and best management practices through a statistical lens - all in pursuit of better development outcomes.

What is a National Strategy for the Development of Statistics (NSDS)? A process which § provides an assessment of the current status of the National Statistical System (NSS) § sets out the objectives for improving the NSS over a 5 -10 year period § outlines the actions required in the short-and long-term to achieve these objectives

What is a National Strategy for the Development of Statistics (NSDS)? A process which § is consultative and participatory in order to: • mobilize support • build ownership • obtain political commitment from all stakeholders to reform and improve the statistical system § builds on what already exists including GDDS, SDDS, Data Quality Assessment Framework (DQAF), Statistical Master Plans (SMP), and Multi-annual Integrated Statistical Programmes (MISP). § is integrated into development and national poverty reduction policies, such as the PRSP

Some Essentials of NSDS § High-level political support and leadership § Identification of user needs and data gaps and weaknesses § Review of existing statistical production and analysis, capacity, legal and institutional framework and coordination arrangements § Setting priorities and strategies

PARIS 21 Regional Programmes § Baseline assessments § Regional workshops § Advocacy at country level § Facilitating technical and financial support § Consolidating partner efforts § Reporting on progress

NSDS Programme in Latin America § Some 10 regional workshops already held in Central America and the Andean Community since 2002. § Central American countries presented their finalised NSDSs to int’l community. § Andean Community countries to pursue strategic development/NSDS approach.

Funding Central American NSDSs Country Data Action Plan Costs Funding Duration (years) Population (*) GDP (**) Statistical capacity building (*) Statistical operations (*) National contribution and others (*) Additional funding to be sought (*) TOTAL (*) Costa Rica (2007 -2011) 5 4. 02 18. 00 1. 29 17. 24 9. 87 8. 66 18. 53 El Salvador (2005 -2009) 5 6. 00 11. 40 2. 79 28. 46 27. 59 3. 66 31. 25 Guatemala (2007 -2009) 3 12. 97 19. 10 0. 28 20. 40 15. 37 5. 31 20. 68 Honduras (2006 -2010) 5 6. 98 10. 80 7. 10 25. 77 2. 98 29. 89 32. 87 Nicaragua (2006 -2010) 5 5. 47 4. 00 14. 09 29. 79 17. 28 26. 59 43. 88 Panama (2006 -2011) 6 3. 30 14. 70 5. 33 9. 52 5. 33 14. 86 30. 88 131. 18 82. 62 79. 44 162. 06 COUNTRY TOTAL (*) millions (**) billions

Conclusions § EBPM is not just a slogan. It has essential for the design, monitoring and evaluation of sound policies. § There are many examples of how, when and where the use of good statistics has improved economic policy-making and led to better policy outcomes (and vice-versa). Investment in good statistics can provide high social returns. § There are reasons to promote EBPM now, namely, monitoring of MDGs, need to evaluate aid effectiveness. § The elaboration of an NSDS can contribute to a more coherent national statistical system, responding to priority needs of statistical users and policy-makers.

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