Churches Challenge IMF on BIG

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By Wezi Tjaronda WINDHOEK The Basic Income Grant (BIG) Coalition has warned that further delays in the implementation of the grant, especially based on unsubstantiated advice, will continue to condemn people to abject poverty. The coalition proposes that the government pays every Namibian citizen an amount of about N$100 every month as a means for many to get out of poverty. With such a sum, the coalition says, parents would be able to send their children to school while others would be able to start up small businesses. Although the idea was rejected last year, the government said there was room for it to be re-looked. Last week, members of the coalition had meetings with the International Monetary Fund (IMF) Chief of Article 4 Mission during which the world body expressed its opposition to the idea. The BIG Coalition said the IMF should not be allowed to have a say on Namibia’s much needed social policies which once implemented would lead to greater equality and alleviate the misery of the poor, and which would be a first step towards redistributive justice. The coalition yesterday said through unsubstantiated advice of the IMF, people such as those in the ‘DRC’ settlements at the coast would continue to search for food among medical waste. Council of Churches in Namibia Secretary General Phillip Strydom told the press yesterday the IMF had advised government that BIG was not viable, which Strydom said was based on wrongful calculations that its implementation would cost Namibia 5.5 percent of its GDP. The IMF said this would compromise the country’s fiscal sustainability. According to independent calculations commissioned by the coalition, BIG will cost between 2.2 percent and 3.8 percent of GDP. He said even though the IMF conceded to have made mistakes in its calculations about the cost of BIG, it still opposes BIG. “Despite this economic evidence by the BIG Coalition and the arguments for the positive social and developmental impact of BIG to curb the high and unsustainable levels of poverty in Namibia, the IMF delegation made its opposition to BIG clear,” Strydom said, adding that the IMF said it would continue to advise the government accordingly. Based on calculations of the Economic Policy Research Institute of South Africa, an amount of N$100 financed through a combination of income tax and VAT would amount to N$1.4 billion per year. Reverend Dirk Harmann, of the Desk for Social Development of the Evangelical Lutheran Church in the Republic of Namibia (ELCRN), said although the coalition believes that the government was capable of carrying out independent decisions, the IMF exerts great influence. “We hope and trust that the government is independent and that the IMF cannot dictate,” he added. Considering that the IMF does not base its opposition on figures, the coalition said the body was against the proposition because it is too redistributive. Having provided the IMF delegation with studies of the living conditions of people in the country, Labour Resource and Research Institute (LaRRI) Director, Herbert Jauch, said BIG would yield concrete results in the short to medium term and have an impact on reducing mass poverty in Namibia. He said the IMF’s policies have over the years subjected citizens of different countries to hardships and further devastation among the poor and were ill suited for Namibian conditions. Although Jauch said the world body says it has changed, it “still follows the same neo-dogma and openly opposes any significant attempts of redistribution”. “The IMF is thus still an opponent of the poor and influences governments without taking responsibility for or learning from its massive policy failures over the past 30 years,” said he. The idea for BIG stems from the Namibia Tax Consortium (Namtax), which in 2002 proposed a grant to put Namibia on an economic growth path. The BIG Coalition was formed last year after a conference in early 2005, which deliberated on BIG. Members of the coalition include Nangof, the Namibia Network of AIDS Service Organisations (Nanaso), the CCN, and the National Union of Namibian Workers (NUNW), LAC and the Labour Resource and Research Institute (LaRRI).