Gender Budgeting: Conceptual Framework

1. Gender Budgeting: Conceptual Framework M. Govinda Rao

2. Introduction • Redistribution is one of the three branches of Government in Musgrave’s classification. • According to this scheme, disadvantaged groups are clubbed merely as one income class. • Analysis shows that there are significant inequalities in key economic social and political indicators. Eliminating inequalities requires changing in the status of women in society. • Eliminating gender inequalities unlike in other cases results in increased incomes and welfare. There is no trade off between equity and growth. Crucial for inclusive/encompassing development • Budget is an important instrument of translating policies into actions. • Gender responsive budget is only one of the instruments. Works well in combination with other complementary policies such as providing access to productive assets and credit, inheritance rights, legislations to prevent occupational segregation and wage differences.

3. What is Gender Responsive Budgeting? • The budget is the most important instrument through which government implements its policies and programmes. • A gender responsivebudget ensures that budget is formulated and implemented to respond to the needs and interests of the disadvantaged. • This requires identification of policies and programmes with potential benefits to women and systematic examination of existing budget programmes and policies for their impact on women. • Gender responsive budgeting is effective only when it becomes an integral part of the budgetary process. This is not an exercise done outside the budgeting framework. • Conventional way is of classify government expenditures into public goods and merit goods. The former is assumed to be “gender neutral” which is actually “gender blindness”. • It is not a mere classification of budgets with benefits to “women” and “men”. Such exercises do not make it a part of the budgeting process. It can be misleading; it does not help to achieve the objectives.

5. Why is Gender Budget Important? • Gender Responsive Budgeting has gained impetus in recent years: Started in Australia (1984), added impetus since the Fourth World Conference on Women in Beijing in 1995. • Objectives: • Equity: • Reduce hardships, improve consumption entitlements vis–a–vis men; • Ensure access to assets; • Human development, improved productivity and incomes. • Externalities: Underpins the rationale for including gender considerations in budgetary process. • Stotsky (2006) surveys evidence of reduction in the disadvantage of women with higher economic growth. Inclusion of incomes from care economy and reproduction (Palmer, 1995). Internalizing externalities. • Increased formalization of informal sector – increase in GDP. No equity – efficiency trade off (Thurow, 1971). • Improved health, education and skill development – improvement in the welfare of not just women but also the family and society. • Strategy to include externalities include: allocation of property rights, taxes, subsidies and regulations).

6. Practicing Gender Responsive Budgeting • Gender Budgeting as a separate exercise: • More comprehensive approach: • Who is responsible? Each spending ministry should be involved and coordinated by the Ministry of Finance. Many governments have informal systems – need to formalize them. • Should be a part of the budgeting process. Should commence before the budget cycle identifying the programmes to be implemented and costing them. Advocacy to include them in the budget. • What should be the scope? Both macro-fiscal dimensions, microeconomic and financing dimensions. • Macro-fiscal dimensions include impact of deficits – appropriate adjustment policies – nature of government intervention; desirable approach to stabilization; impact of austerity measures on women; impact of economic instability. • Microeconomic dimensions: How do we internalize externalities; Composition of revenues and expenditures to empower women to improve welfare of society. • Financing dimensions: methods of financing deficit: assignment between governmental units; . • Reporting systems: depending on assignments: reports prepared by spending departments; incidence and impact of spending programs, (policy appraisal, benefit incidence; impact on care economy etc.,).

7. Practicing Gender Budgeting • What should be the scope? Both macro-fiscal dimensions, microeconomic and financing dimensions. • Macro-fiscal dimensions include impact of deficits – appropriate adjustment policies – nature of government intervention; desirable approach to stabilization; impact of austerity measures on women; impact of economic instability. • Microeconomic dimensions: How do we internalize externalities; Composition of revenues and expenditures to empower women to improve welfare of society. • Financing dimensions: methods of financing deficit: assignment between governmental units; . • Reporting systems: depending on assignments: reports prepared by spending departments; incidence and impact of spending programs, (policy appraisal, benefit incidence; impact on care economy etc.,). • Gender budgeting should combine other initiatives (performance budgeting; outcome budgeting). • Medium term fiscal plan and linking with annual budgets.

8. Practicing Gender Budgeting • Need to involve all the spending departments in gender responsive budgeting: Even in “public good” departments, there is need to sensitize. • Subnational governments have particularly important role. • There are informal systems of introducing expenditures that helps in capacity development of women – often for for electoral reasons. • Often these initiatives are taken at sub-national levels. Sub-national governments innovate better than central governments (girls hostels; bicycles for girl children; toilets in schools; insurance schemes; mid-day meal schemes). • In most countries, such expenditures are initiated for electoral reasons rather than as a part of well worked program. • Need to initiate gender budgeting exercise particularly at local levels.

9. Concluding Remarks • Properly targeted and structured public spending and revenue policies can significantly contribute to reducing gender inequalities . • Reduction in gender inequalities is important for ensuring equity and equality. But that is not the main motivation for GRB. The principal objective is to internalize the externalities and improve welfare. Higher welfare of women leads to higher welfare of the family. • Gender sensitization is important for men as much as women. Prejudices are deep-rooted . • Effective GRB must be supported by good research and advocacy. Both research institutions and NGOs will have to play an important role. • Need to have good statistical base. Both consumption, income, savings, asset ownership and employment details by sex must be collected. • In most countries, GB has become a mechanical exercise and is not a part of the overall budget exercise. Various interest groups get opportunities to voice their views, but not women’s groups. • Constant effort is necessary to create a good system of GRB.