As prepared for delivery.
Ladies and gentlemen,
Earlier this week I took part in the global launch of the United Nations Development Programme’s (UNDP) flagship Human Development Report in Colombia.
I am delighted to join you in Brussels today to present the report to the European Union and Member States, and our international development partners.
The concept of human development has enjoyed a warm reception in Europe over the years.
It is easy to understand why.
First, because the HDI demonstrates the progress of and within European. Nearly all the countries with the highest HDI values are on the European continent. Some of the biggest increases in the HDI over the past decade or so have similarly taken place here, with impressive gains in Ireland being just one notable example.
Second, because it offers a snapshot of the impact of investment in human development across the world, including in the countries and areas supported by the European Union and its Member States.
While the overall progress is remarkable, evident by how many countries are moving from low to middle to high income groups, many countries are still struggle to get off the bottom rungs of the latter; in others, confusion and division have transformed into conflict and chronic instability, reversing decades of hard-won gains in human development.
In this context, I express my appreciation to our European partners for their steadfast leadership on human development.
The United Nations is very proud to work together with the EU on gender-based violence through the Spotlight Initiative, for example, working together to tackle one of the most pervasive human rights abuses, which impacts roughly 35 percent of all women.
And as I reinforced this week in Madrid at the climate Conference of the Parties, the EU’s leadership on climate change is notable. Ambitious plans like the European Green Deal announced by the new European Commission have the potential to set the standard for the role of public authorities in supporting climate mitigation and adaptation.
UNDP recently committed to support 100 countries to accelerate the implementation of their climate plans by 2020, in a bid to help stabilize global temperature rise by 1.5C by the end of this century by reducing emissions and achieving climate neutrality. We look forward to working closely with the EU and its Member States on this critical mission.
Ladies and gentlemen,
Though nearly 30 years old, the HDR and its Human Development Index, which ranks all countries in the world by their level of human development, remains a powerful voice today.
Its aspiration is simple: to offer a simple measure of what matters to help people live lives they value.
This year’s report is the first of a new generation of HDRs for UNDP, pushing the boundaries as part of #NextGenUNDP to accelerate thought leadership, drive conversation on the future of development, and in so doing, advance progress towards the 17 Sustainable Development Goals.
The topic of this year’s report is inequality, and it could not be more timely.
Inequality, it says, is not just about how much someone earns compared to their neighbour. It is about the unequal distribution of wealth and power, the entrenched social and political norms that are bringing people onto the streets in cities and towns across the world, and the triggers that will do so in the future unless something changes.
The report sets out that just as millions more people have what are considered the basics for a dignified life, the abilities people will need to compete have evolved. Tertiary education and access to broadband were once considered luxuries but are increasingly considered critical to thrive.
Yet, in countries with very high human development, subscriptions to fixed broadband are growing 15 times faster and the proportion of adults with tertiary education is growing more than six times faster than in countries with low human development.
A new generation of inequalities is opening up around education, as well as technology and climate change – two magnifying trends set to permeate an already weakened social fabric.
Recognizing the real face of inequality – one that weakens cohesion, damages people’s trust in government, institutions and in each other, and prevents talented people from reaching their potential -- is a first step.
By looking beyond income, beyond averages, and beyond today decision makers will be better placed to tackle it, complementing traditional tax and transfer responses, because inequality is not beyond solutions.
Let us take each area of analysis in turn:
Inequality cannot be boiled down to a story of rich countries versus poor countries, nor can it be measured only by a person’s income.
I know the EU takes this seriously, for example through its Gender Action Plans to reduce gender inequalities and promote women’s empowerment around the world.
Two-thirds of people living with multiple dimensions of poverty — 886 million people in the world — live in middle-income countries. And inequality exists between two people under the same roof.
In South Asia, for example, almost one quarter of children under the age of five live in households where at least one child in the household is malnourished and at least one child is not.
Dignity as equal treatment and nondiscrimination can be even more important than imbalances in the distribution of income.
The report cites a 2017 UNDP survey conducted in Chile, in which 53 percent of people said they were bothered by income inequality. But respondents expressed more discontent with unequal access to health, to education, and unequal respect and dignity in the way people are treated.
As the 2019 Inequality-Adjusted Human Development Index sets out, the unequal distribution of education, health and living standards stymies countries’ progress. Twenty per cent of human development progress was lost through inequalities in 2018.
The report shows that inequality begins even before birth, arguing that early childhood and lifelong investment are essential. For example, children in professional families in the United States are exposed to three times as many words as children in families receiving welfare benefits, with a knock-on effect on test scores later in life.
Across European countries, parental socioeconomic status has been associated with student test scores.
If we want to equip children with the knowledge and skills to succeed in a world that is relentlessly raising the bar, we must invest inside and outside the classroom. Policies that start at or before birth, including those that improve young children’s learning, health and nutrition, are crucial.
In terms of productivity, the report shows that the growing market power of employers is linked to a declining income share for workers. It argues that anti-trust and other policies are key to address the imbalances of market power.
Europe has lessons to share in this regard. Some have argued that product markets in the EU have become more competitive, especially in contrast to growing market concentration in the US, as competition policy in the EU that become more robust.
The report also argues that taxation cannot be looked at in isolation. It should be part of a system of policies, including public spending on health, education, and alternatives to a carbon-intensive lifestyle. And as the report points out, in an increasingly interconnected world, greater international coordination on taxation is needed, especially on thorny issues like digital taxation.
The OECD’s efforts in this regard are a welcome reminder of the purpose and benefits of multilateralism and multilateral organizations.
Averages often hide what is really going on in society, says the HDR.
While they can be helpful in telling a larger story, much more detailed information is needed to create policies to tackle inequality effectively.
This is true in tackling the multiple dimensions of poverty, in meeting the needs of those being left furthest behind such as people with disabilities, and in promoting gender equality and empowerment.
According to the OECD, it would take nearly five generations for poor families in OECD countries to reach the mean income in their societies. On gender, for example, based on current trends, it will take 202 years to close the global gender gap in economic opportunity alone. In Europe, gender pay gaps have generally improved since the millennium, but gaps persist and vary widely across countries.
While the silence on abuse is breaking, the glass ceiling for women to progress is not. Instead, it is a story of bias and backlash.
At the very time when progress is meant to be accelerating to reach the Sustainable Development Goals (SDGs) by 2030, the report’s 2019 Gender Inequality Index says progress actually is slowing.
In a new survey on social biases around gender conducted for this HDR, about 42 per cent of people surveyed across 77 countries said they thought that men made better business executives. Therefore, policies that address underlying biases, social norms and power structures are key.
For example, policies to balance the distribution of care, particularly for children, are crucial, given that much of the difference in earning between men and women throughout their lifecycle is generated before the age of 40.
And protests are happening about things that matter beyond today.
Some argue we have entered the ‘age of anxiety’. People are worried about their future, particularly under the shadow of the climate crisis and technological transformations in our economies and societies.
Europe is a crucible for climate policy.
Sweden, for example, is at the forefront of carbon pricing, demonstrating the importance of a systemic path to decarbonization and sustainability, walked in a way that brings everyone along and responds to the realities on the ground.
Germany recently approved a USD 60bn climate package meant to ensure that the country reaches its emission reduction targets in line with the Paris Agreement, and the Dutch government presented the new climate agreement aiming to reduce CO2 emissions in the Netherlands by 49% by 2030 compared to 1990.
France, whose capital city lends its name to the international climate agreement, understands well how carefully this must be managed. Thought it already has a carbon tax that is amongst the highest in the world, the gilets jaunes took to the streets – initially at least – to protest a planned rise in the tax on diesel and petrol.
There are good practices ways to introduce such changes, says the report, whereby revenues generated by carbon pricing can be invested in public infrastructure and renewable technologies, offering alternatives to the groups most likely to be negatively affected, in the short-term, by going green, and increasing public support for carbon pricing.
Revenues can also be ‘recycled’ to benefit taxpayers as part of a broader social policy packages, that could reduce, rather than increase, inequality.
The plan for a Just Transition Fund, currently under development in the European Commission, is a good example of how such issues can be planned for and addressed, to help smooth swift transition of the EU’s fossil-fuel dependent regions to clean energy.
We also need to avoid a ‘new great divergence’ in our societies driven by artificial intelligence and digital technologies.
There is historical precedent for technological revolutions to carve deep, persistent inequalities – as took place in the Industrial Revolution. Since the millennium, labor markets have become more polarized in the EU, United States and Japan, as automation and digitization displace jobs, especially medium-skilled routine jobs.
Workers with lower levels of education are at higher risk of displacement. And as the HDR notes, workers with lower wages participate less in adult learning, which means they risk being left behind as those with higher wages develop new skills and pull further ahead.
How we adopt and use new technology is on our hands, and it can be guided to be a force for good.
To that end, the HDR recommends social protection policies that would, for example, ensure investment in lifelong learning to help workers adjust or change to new occupations, and international consensus on how to tax digital activities – all part of building a new, secure and stable digital economy that advances inclusive human development.
Implications for UNDP
Ladies and gentlemen, at UNDP, we are committed to pressing the frontiers of development such that no-one is left behind; to accelerating local action for global change while pushing the boundaries in how we think, deliver, invest and manage to drive progress towards the Sustainable Development Goals.
As a result, last year, for example, 31 million people across the world had better access to the services they need to tackle poverty; 21 million people registered to vote; 27 million people were stronger in the face of climate change; and 256 million tons of carbon emissions were cut, the equivalent of taking over 50 million cars off the road for a year.
Looking across the 170 countries and territories we serve, we saw increased demand in the very areas that threaten to open a Great New Divergence between countries and communities: climate change and technology.
For example, we saw a surge of requests for our collaboration on how to use technology and digital solutions to improve civic engagement, advance digital inclusion, address corruption and uphold human rights.
And we worked with 140 countries to tackle climate change, including on their Nationally Determined Contributions -- the corner stones of the Paris Climate Agreement.
UN Secretary General António Guterres has called for a rapid and deep changes in our way of life, including to tax pollution and not people – illustrating just how intertwined and systemic the challenges of inequality and the climate crisis are.
Looking ahead, we see a clear role for UNDP in accompanying policy and decision-makers to look at but also go beyond Gini coefficients and taxation -- important though they are;
To provide analysis, as we do here today, on the multiple dimensions of inequality, accompanied by integrated, equalizing solutions that start early and span what one could argue are three key stages of a person’s life.
- before they reach the labour market, to address nutritional, health and educational gaps between children and youth;
- once in the labour market, to harness the power of labour, industrial, gender and anti-trust policies to level the playing field;
- and after the market, to make sure taxes, transfers and subsidies equalize the opportunities between the haves and have nots.
At UNDP, each step we take with our partners is rooted in our commitment to tackling the many faces of inequality, just as it is a demonstration that decision-makers are taking steps to leave no-one behind.
The question is “is it enough”? Is progress happening at the speed and scale required, including to reach the Sustainable Development Goals by the end of the next decade?
If we look at the news, or depending on where we are in the world, if we look out the window, the answer to that question has to be “no”.
This, therefore, is our collective task:
- to finish the work of the 20th Century, such that all people on this planet have the basic freedoms and opportunities they need for a dignified life;
- to catch up to the new inequalities of the 21st Century, which paint an evolving picture of how people feel and of their aspirations and expectations for the future, as this HDR sets out;
- and – given that a baby born in 2020 will likely live to witness the dawn of the next Century – to prepare the ground for a 22nd Century where every person has equal opportunities and freedoms, and the inequalities we see today are a thing of the past.
This three-Century task will require changes in social, economic and political norms embedded deep within nations’ histories.
Making the decision to change is a choice.
Some 40 years ago, the founding father of human development, Professor Amartya Sen, asked a deceptively simple question: equality of what?
He answered with equal simplicity: of the things we care about to build the future we aspire to.
Professor Sen’s words remind us why this is important, why we must go beyond growth and markets to understand why people are discontent, and what leaders can do about it.
We do it together because we are building the future. Let us make sure it is one we will be proud of.