I’ve just heard a superb presentation by Stephen Kidd, of Development Pathways. He argues that developing countries should be focusing on universal benefits, like child benefit or a universal pension, rather than the means-testing which is being rolled out in many poorer countries. The report, by Development Pathways and the Church of Sweden, is here.
To give a flavour of his argument, here are two graphs. The first highlights the failure of selective benefits. The best performing selective programme, in Brazil, excluded 44% of the eligible group. The worst performing, in Rwanda, used community based targeting, and excluded more than 97%.
The second graph shows something about the tax take. Offering universal benefits means that people feel included in the support offered by governments – and that means that they are more ready to pay tax. Kidd argues that universal benefits create trust, and the sense of a social contract.
