Poverty

Lord Crisp Excerpts

Thursday 14th July 2016 Lords Chamber

[Lord Crisp (CB)]

My Lords, I am delighted that this debate is happening and congratulate my noble friend on securing it and on his passionate opening speech. I shall concentrate on action rather than analysis, bring in a global perspective and make three points. The first is simply the importance of listening to poor people and working with them. Some years ago, the World Bank published a fascinating study covering a number of countries, which demonstrated what I guess we already know: poor people often well understand their predicament, have good ideas about how to get out of it and what needs to be done, and those ideas are often very different from what the authorities think needs to be done. They are simply not heard; other people make decisions about them; they are invisible. As the World Bank concluded, poor people are able partners.

Let me illustrate this. Many poor people have to be ingenious managers of their situation. I was struck by the words of the noble Lord, Lord Ouseley, talking about the situation he was in, where the routes out were begging, borrowing, stealing and blagging. In another recent study, authors looking at poor people’s experiences in three or four countries demonstrated that, on average, they use between eight and 10 financial instruments to get by. What do they mean by that? They borrow from neighbours, friends and microfinance institutions; they use credit with suppliers; they sell and buy assets; they save money with different schemes; they pay in advance; they send remittances to their home village; and they use so-called money guard schemes, whereby you give money to a neighbour for safekeeping, just in case you are tempted to spend it, and they do the same for you. That is an enormous amount to keep up with on top of a very stressful existence. It reminds us that people are endlessly resourceful and that we should work with them, their abilities and perspectives. The central point is that traditional approaches to policy simply do not do that, and need to be adapted to do so.

Grameen Bank, which was the first microfinance institution in the world, providing small loans to poor people to enable them to get on with their lives, was set up largely on the basis of traditional banking rules. After a period it started to fail and, to its great credit, it changed the way it worked, adapting to how poor people actually behaved and thought about their situation, offering loans on a rather different basis from its original intention. In other words, it supported what people were doing rather than seeking to impose different patterns of behaviour. It treated them as able partners. That raises the question whether our systems not only ignore people and make decisions for them, but seek to impose different ways of behaving and do not treat poor people as partners.

My second point concerns joined-up action. By that I could just mean joined-up policy and government, but I mean joined-up action. Let me tell the House about BRAC, a very large local NGO in Bangladesh focused on working with the ultra-poor. It does so by providing education classes for women, offering health services, even though it is not a health institution, and developing microfinance. Every time it discovers a new barrier to people gaining greater prosperity, it develops a new way of approaching it. It realised that people getting microfinance loans needed shops, so it started some. It runs schools, a hospital and a university. It is building up the infrastructure as it recognises the need to do so.

We may well say that that is all very well in Bangladesh because there was not much there in the first place, and it is being built up incrementally. However, this is precisely the approach my noble friend Lord Mawson has been using in St Paul’s Way. I think he will speak to the House about it later. He has moved on from improving education to housing and working with local employers and the local health system. In our case, it is even harder going—I expect my noble friend will talk about it—because of all the barriers put in the way of people trying to build up infrastructure in this way. Central to this approach is learning by doing. It is about small-scale experiments and learning, not a grand plan.

Thirdly, we need good evidence-based policy that enables and facilitates such developments. There is some. Let me illustrate this with health. Poor health often accompanies and can cause poverty. I have a great brief from the Faculty of Public Health, which I am not going to read. I shall highlight one point, which is that recent research by Michael Marmot and others shows that we need a coherent set of interventions throughout the whole life cycle to improve and sustain the population’s health. It is the package that counts; it is not pick and mix, a bit of this and a bit of that. That package needs to include everything from early-years education and family support to reducing inequalities in access to healthcare.

In summary, looking forward, we need the new Government, who say that they aim to leave no one behind, to put a completely new emphasis on the capabilities of poor people, on supporting what people are doing for themselves and on rigorous evidence and understanding. There are models to copy. I have already cited my noble friend Lord Mawson; there is also the noble Lord, Lord Bird, and new approaches are coming along.

Finally, like other noble Lords, I am very much looking forward to the valedictory speech by the noble Baroness, Lady Sharp of Guildford.