More trouble for SKS

“We have found massive problems in insurance operations of SKS Microfinance,'' Mr J. Hari Narayan, Chairman, Insurance Regulatory and Development Authority (IRDA), told Business Line here on Tuesday.



The irregularities included receiving the cheques of death claims from its insurers on its name, which is illegal.

The only listed MFI in the country, based out of Hyderabad, had also “collected” higher commissions than permitted by the insurance regulator while selling the insurance policies.

SKS has been summoned by IRDA for an explanation, Business Line reports. More regulatory trouble is not what SKS needs, with its already plummeting stock prices. Having said that, micro-insurance is tricky business and agencies sometimes expose themselves to regulatory risks in trying out innovative solutions to improve access for the poor. On the other hand, some agencies try to be clever and try to intentionally control their clients' insurance pay-outs so that these could be held as a sort of proxy-collateral for their outstanding loans. I am not insinuating anything in this particular case, of course...

A view on Hope; and a pertinent question to randomistas

...What concerns me is that the direct interventions that are targeted towards addressing such psycho-social constraints are not highlighted or even mentioned as they are not neat enough for RCT measurement. Instead the reliance is on the outcome variables and a black box of intervention package which is not very helpful for intervention design. Short of component randomization which is impractical, evaluation experts should come up with credible ways to speak to this need. Analytical narration of interventions that directly address such constraints could be a starting point...

A comment by IMatin, who I think is Imran Matin on this Economist article on the JPAL study on Bandhan's ultra-poor intervention in West Bengal

Lobbying: what our Parliament should learn from the US' Senate

In this age of blatant lobbying,

The (US) Senate minority who last week blocked a vote on ending Big Oil subsidies received more than four times the oil and gas contributions than the 51 senators voting to end them. Exxon Mobil, the world’s most profitable corporation, has helped preserve these and other loopholes for oil and gas by building a Washington force tied intimately to conservative lawmakers, Steve Coll reports in this week’s New Yorker. The corporation relies on an algorithm to determine tiers of oil industry allies and sent 90 percent of contributions to Republicans last year

we are still bothered about cash-for-questions and personal endorsements?

We really need to reform our parliamentary system...learn from the greatest democracy of the world?

Quick views on Satyamev Jayate

Satyamev Jayate is the latest celebrity show on television. KBC created millionnaires, Khatron ke Khiladi looked for daredevils, Big Boss created a bunch of public nuisances - this one wants to 'change our hearts' and while at it, hit us hard. So Aamir the superstar with his carefully cultivated public image hosts the series, the first of which focused on female foeticide. A bunch of media articles have dissected the show - I am going to try add some more - there aren't too many, I promise and I am going to keep adding to the list as and when something strikes me...

First the positives -

• Female foeticide is serious business and people need to sit up and realise the enormity of this evil. This show got people talking about the issue - a fairly good start; and great use of celebrity, as many have pointed out
• The show relied on facts as much as it did on anecdotes and imagery
• The show examined multiple facets of the issue - family, demographics, doctors, government, social consequences, a success story, etc
• A politically safe topic to begin with - which could be good/bad - we'll have to wait and see how the rest of it unfolds

While I didn't mind the incessant promos and Aamir's preachiness, here's what I didn't quite fit neatly with the 'socially-conscious' show

• Making an issue purely personal sometimes comes in the way of an institutional solution. Somewhere in the show, the 'personal' took over because the host was Aamir and this is his connect with his audience. So although there were mentions of Korea and the success in Nawanshahar, at the end of the day, it boiled down to the sms and fund raising for Snehalaya, an NGO.
• Female foeticide is a crime - not doubt about it. But what are the sociological factors that underlie this phenomenon; can these notions be dispelled? how? Nothing in the episode seemed to touch on this aspect.
• Aamir pulls in the eye-balls. But clearly, in his presentation, he is aware of his celebrity status and is happy to project himself as the crusader, who is going to write the golden petition to the Rajasthan government. But the show should not be about him and neither should it be about what he has learnt. Its about issues that matter and people whose lives are affected by them.
• The reality show format with a bunch of star-struck spectators in the studio is an instant put-off. If anything, their reactions come across as tutored, if not fake
• Its unfortunate, but Sachin and Aamir - two of our biggest brands seem to have become the Ambanis' resident celebrity cheer-leaders 

To sign off, a couple of what-ifs

• What if Aamir encouraged us to not only send text messages, but also seek out and tune into other media that highlight similar issues? suicidal, I know - and Aamir is not naive.
• What if Rahul Gandhi hosted this show? ah, well...we will never find out.

Bureaucratic resistance to institutional reforms

Institutional reforms have been recently generating considerable interest and excitement. Good institutions are seen as paramount to developmental success and everyone has an expert view about what needs to change and why. ‘How’ seems to garner much less attention. It is not as clear if most people actually understand – or consider - how institutions go through reforms. Implementation of a reform tends to fall into the gap between policy formulation and policy outcomes and hence, is usually taken for granted or ignored

More here, on livemint - by Doug and Suvojit

Noam Chomsky on Inquiry

...You can’t pursue any kind of inquiry without a relatively clear framework that’s directing your search and helping you choose what’s significant and what isn’t… If you don’t have some sort of a framework for what matters — always, of course, with the provisor that you’re willing to question it if it seems to be going in the wrong direction — if you don’t have that, exploring the Internet is just picking out the random factoids that don’t mean anything… You have to know how to evaluate, interpret, and understand...

More here

Lessons for the field

• It is possible to make a difference to lives of people by sustained intervention at the grassroots. Keep in mind, the concept of big and small development - the big can take over the small, but don't wait for the positive big swell to take you over; and dont worry about the negative swell undoing all of your good work. While you are on the ground, keep chipping away
• No one out there wants your sympathy, except maybe your underpaid long serving colleagues. But if the communities you are working with see you getting emotional, you are in for trouble. However, admire openly. That usually works.
• Any change is excruciatingly slow. Patience is key in everything - action and communication. For that reason alone, dont worry about taking your time
• People usually don't change because you want them to. They may not be willing to change even if its over an issue you are convinced is to their benefit. They mostly, merely respond to incentives. Understand the incentives involved and try to get them right
• Some like to be photographed - some don't. They dont expect you to, but respect this choice.
• This one was obvious - not all the disprivileged are good souls. Watch out for the smart ones. If you are one, they can be, too.
• You are never one among them. Keep trying, but don't claim to have mastered it and even if you do claim so, please don't believe it yourself.
• People do not know everything. There is definitely a lot that you can teach them. There is a lot more for you to learn, but thats obvious, right?
• Approach your job analytically. When in trouble, reflect on what's going on and what that teaches you about yourself, about development and about how organisations run
• Start writing - field reports, if nothing else; doesn't matter if noone is reading. Do it for yourself 
• Don't obssess about 'influencing policy' - focus on 'good change' instead.
• Learn the language. Works like nothing else can.

More power to UNCTAD

Why is UNCTAD ignored/suppressed/undervalued, asks Jayati Ghosh -

...Unctad was among the first to note the potentially damaging implications of financial deregulation and capital account liberalisation, which are now widely recognised to be associated with financial crises in both developing and developed countries. It identified problems such as the impact of financial activity on commodity prices, and the effect on export prices faced by developing countries when too many players attempt to enter the same markets with similar exports. It examined ways in which commodity-exporting developing countries can benefit sustainably from periods of rising prices, rather than suffering from a "resource curse". More recently, it provided a sane and plausible strategy for growing out of debt rather than killing the patient with more destructive austerity measures, a lesson now being recognised (if reluctantly) even in Europe...

...the content and results of the research produced by Unctad are very much in the interests not just of developing countries per se, but of ordinary citizens all over the world, the 99% of popular imagination. The rearguard action fought by some negotiators to control and limit Unctad's work was more about trying to create a single homogenous approach to economic analysis and policy to be accepted globally, even if that approach is increasingly being exposed as misleading and downright wrong...

Meanwhile, here is Alanna, who covered the recent UNCTAD conference and has been asking similar questions

Is the opposition to UNCTAD aimed at killing the only consistent dissenter in the room - a global body on trade and development with a non-American/European boss?

An economy shouldered by destitutes

Yet another reminder that a good part of our so-called progress and economic boom is shouldered by destitutes - the story in The Hindu about the exploitation of migrant construction workers in our cities, right under our noses, under the watch of governments, as well as myriad rights activists. And its unlikely to get any better, since the construction industry is made up largely of unskilled workers - 82% of the workforce in the sector in 2005.

Empowerment

Empowerment means having voice;
You enjoy the right of choice;
You are free in every way; 
To run your country as we say". 

by Robert Chambers; H/T Lawrence Haddad

Decentralisation, Mining and Conflict: A few insights from Peru

Thoughts on conflicts around mining and decentralisation. See here for a related discussion; and here, for Javier's paper referred in this piece

...It makes eminent sense consider ways to develop mechanisms for collective bargaining through strengthening local governments in mineral-rich parts of the country. The district-level local governments have a key role to play, bringing together multiple village and block-level local governments to develop a consensus on the terms of their collective bargaining. Another imperative strategy is to build capacity for resource management by local governments. Once revenues start flowing to local governments, how will these be managed? Currently, local governments in states such as Jharkhand and Chhattisgarh are acknowledged to be very weak and are therefore unlikely to be able to ensure efficient allocation of resources to address the development needs of their constituencies...

From our latest column on livemint

Democracy?

Guess which country this might be

Imagine a country without an election commission, where the state makes no effort to prepare an electoral register at national, regional, or provincial level, where it is left to citizens get themselves on the register, and where the ruling party in every province writes the rules and procedures for registration and then conducts the poll and the count. Imagine a country where a federal court decision has been necessary to bar voter intimidation by party supporters who demand to see voters' identification at polling stations, challenge voters' credentials, film them as they vote, distribute leaflets stating the penalties for voting fraud, and bombard selected neighbourhoods with junk mail, which is often returned undelivered and then used by party zealots to claim that the voters concerned do not live at the addresses shown on the electoral roll.

See here for the answer 

UK aid to India: Railways edition

Ok, there is one more favour we need from the UK and this time, billions of us will be genuinely grateful. This story in The Hindu -

In a report, the U.K. Law Commission on Wednesday said it had identified as many as 38 Acts dating back to 1849 and 1942 and concerning the various railway companies that operated in colonial India and “in the wider East Indies”...

...Obsolete or not, they provide a rare glimpse into the origins of the Indian railway system, arguably one of the few beneficial legacies of the Raj. The first regular train service between what was then Bombay and Thane was established by the Great Indian Peninsula Railway Company in 1854 under an Act passed in 1849 Act. It incorporated the company and gave it power to enter into contracts with the East India Company.
This Act is now on the chopping block as is a 1942 legislation enabling liquidation of the Bombay Baroda and Central India Railway Company after its operation had been sold to the government. Other provisions proposed to be repealed include the Assam Railways and Trading Company's Act, 1897; Oude Railway Act, 1858; Scinde Railway Act, 1857; and the Great Southern of India Railway Act, 1858.

Please dont destroy them just yet. Pass them on to us. I am sure our government can even pay up if you are being fiscally conservative in these tough times. Given the current state of our railways and the kind of Railway Ministry we are stuck with, even these 19th century laws might teach us a LOT!

First principles: R&R before CSR

In a recent article in livemint, the author Arvind Pandey makes a set of excellent points about the importance of a well-planned CSR programme, especially by companies that initiate large projects that affect and displace communities, such as the metals and mining industry. While the article rightly points out that in the current political scenario, these investments are nearly non-negotiable, one got the feeling that the author mixed up Rehabilitation & Resettlement (R&R) with Corporate Social Responsibility (CSR).

It is important to make a distinction between CSR and R&R. Ensuring Rehabilitation & Resettlement of communities affected and/or displaced by big projects is the obligation of the industry and the government. As difficult as it may be, one needs to assess a fair price for land and houses to compensate communities. Also, the damage caused (and to be caused) to the environment needs to be accounted for and this responsibility sits squarely on the industry, with the government playing the role of a fair arbitrator. The industry needs to play fair and does not attempt to secure any undue benefits through manipulating the license and acquisition processes. This is Step Zero and should be factored into proect cost calculations.

In recent years, we have seen companies ignoring R&R at their own peril. Projects such as Singur were disrupted because basic R&R terms were not agreed and acted upon. The stalled projects in Orissa are awaiting a fair resolution to the R&R terms being offered to the communities.

Sustainability and CSR (which are optional and in principle, determined at the discretion of the industry) comes only once R&R activities have been completed. While the Companies Bill and the Mining Bill, may attempt to stipulate CSR spending, the nature of these projects and the exact details may can be left to the industry and they can explore innovative ways of making a difference to communities that live around their facilities. R&R, on the other hand, must be a non-negotiable, governed by statutes.

R&R is the first step towards building a relationship of trust with local communities. A strong CSR programme would secure this relationship and keep communities invested in the prosperity of the industry and of the economy in general.

Listing best ways to give to the poor: A Comment

In response to my last post, my friend Heather has the following to say.

***

For one, yes, RCTs don't tell us all that much about the potential for scale-up -- especially when the RCTs (and other evaluations) don't publish process details, subjective data on the treatment and outcomes, or disseminate the results to local stakeholders and participants and share with 'us' (consumers of research) how the results were received and what recommendations were made about moving forward. As you well know, I think we do a particularly bad (if not disingenuous) job of this.

Two, yes, I think we should be wary of giving 'things' (nets, stoves, cows) unless there is a long-term plan for maintenance.

Three, I agree that what a lot of local people demand (see, for example, Afrobarometer) are public goods like roads and electricity and closed sewers. These are things that people should demand from their government and that governments should deliver.
Four, though, is that people (like Christianity Today readers) seem to want to give - witness TOMS shoes, Kiva, Kony2012, among other things. So, I feel we do have some interest/obligation in coming up with ways that people could give in small chunks in a way that would feed larger change without totally undermining the indigenousness (not a word) of that change. To that end:

a. I like the closing of the World Bank article that says marketing hype and proven impact are inversely correlated. What could we do to get the giving public to demand or even support rigorous research on on-going, popular aid programs? And, then, how can we better publicize what's not working (and suggest what is)?
b. Does something like the Global Fund start to answer these questions? And, what is about giving to GFATM that does not meet the emotional needs of givers to have given a quantified thing or to a particular person -- and how could we better align emotional and on-the-ground needs?

c. Could we ever donate directly to governments? Let's suppose that, for political and economic reasons, we think it is better if the government of X were to provide roads in X (rather than small private donors or even big industries from Z coming in and enhancing infrastructure as suits them, often with workers from Z). But, the public money either isn't there (poor tax base) or is poorly managed or targeted. What if I, sitting in Y, were willing to 'sponsor' 5 miles of highway -- if I could get some guarantee that the money would not only be definitely spent on roads but, possibly, even earmarked only for roads specifically in a marginalized state/district in X. I could even get a picture of my road. This doesn't really touch on issues of maintenance, etc, but would it be a possible way forward, rather than sending lots of shoes or stoves to a country? No idea.

***
Here's Heather's blog, a must-read for anyone interested in details and nuances, of just about everything in global development, in particular, public health.