Amnesty International Report 2017/18
15
SPOTLIGHT ON AUSTERITY
“I
feel alone, like I’ve been left in the dark without anywhere
to get help… I’m scared about what that will mean for my
kids.”
– Sarah
When the UK government cut legal aid support in 2012, Sarah was left without the support
she needed to fight a complex legal case regarding access to her children. She is one of
countless millions affected worldwide by government austerity policies. Yet the sheer scale
of austerity and the statistics surrounding it can blind us to the day-to-day toll it is having
on the lives of individual people and families.
Since the financial crisis of 2008, austerity has become a familiar term and experience for
millions of people. This phenomenon – in which a government seeks to reduce a deficit in
public finances, typically to reduce public debt – usually involves cuts to government
spending, sometimes coupled with tax rises which often hit the poorest hardest by raising
prices of basic necessities such as food.
Austerity is a human rights issue. It affects people’s access to education, health, housing,
social security and other economic and social rights. It also leads to abuses of civil and
political rights, as governments respond to protests and other dissent in draconian ways or cut
services that affect access to justice, such as legal aid. All too often, governments dismiss
these rights and make decisions that put the greatest burden on those living in poverty while
threatening the welfare of society as a whole. Austerity is a global issue. In 2017, widespread
austerity measures were applied in countries from every region, particularly restricting people’s
economic and social rights.
In Europe, people took to the streets to protest against the detrimental effects of austerity
measures in Greece, Serbia, Spain and the UK. In the case of the latter, research in England
linked roughly 120,000 deaths to cuts to health and social care.
Amnesty International is researching the impact of austerity policies on the protection and
realization of socio-economic rights in selected countries. The next piece of research, to be
published in the first half of 2018, focuses on the impact of austerity measures on the right to
health in Spain. A nurse working in the Spanish public health system told Amnesty
International: “We have all suffered because of the cuts: nurses, doctors, patients, families,
everyone.”
In Sub-Saharan Africa, subsidies for the poor and social welfare have all been cut at a time
when consumption taxes such as Value Added Tax (VAT) have been increased, often hitting
hardest those living in poverty. Countries including Botswana, Burundi, Mauritius,
Mozambique, Namibia and Togo continued to be “advised” by the International Monetary
Fund (IMF) to keep on implementing austerity measures – despite the IMF’s own admission in
2012 that such an approach is not always warranted and can undermine the economic growth
needed to pay for services. In North Africa, Algeria’s response to the fall in oil prices saw its
government implement deep spending cuts in its 2017 budget, combined with a rise in VAT
from 2% to 19%. IMF lending policies also prompted the Egyptian government to raise the
prices of essential goods and services.
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Amnesty International Report 2017/18
In Brazil, the unprecedented decision to impose a 20-year fiscal spending cap at the end of
2016 drew strong criticism from both inside and outside the country. In condemning the
measure, the UN Special Rapporteur on extreme poverty and human rights stated: “Logic
dictates that it is virtually inevitable that the progressive realization of economic and social
rights [will] become impossible.”
Economies in the Asia-Pacific and Middle East regions were similarly hamstrung by austerity
measures. During 2017, Indonesia, Mongolia and Sri Lanka witnessed cuts to public
spending. Even the budgets of resource-rich Qatar and Saudi Arabia shrank in moves to
reduce state deficits, prioritizing economic efficiency over social protection.
In the absence of appropriate social safety nets, such measures risk violating governments’
human rights obligations as well as commitments under the global 2030 Agenda for
Sustainable Development and its 17 Sustainable Development Goals.
Looking ahead, even in the short term some commentators are forecasting an “austerity
apocalypse”. Regions such as Southeast Asia and Sub-Saharan Africa are predicted to be
particularly badly affected. One report forecasts that during the next three years more than
two-thirds of all countries will be impacted by austerity, affecting more than 6 billion people
and wiping 7% off global Gross Domestic Product. The human cost is estimated to include
millions being put out of work, including 2.4 million people in low-income countries, with few
prospects of alternative employment.
How should governments respond and what do they have to do to fulfil their human rights
obligations? These obligations do not prohibit austerity per se, but do require that other options
also be considered by governments making economic and fiscal decisions. Above all, human
rights underline the importance of governmental accountability when making such decisions.
Rights holders should be asking key questions of their governments when confronted by
austerity: What levels of scrutiny were employed? How participatory and transparent was the
process? What potential impacts, particularly on the most socially and economically
marginalized, were considered and what mitigation measures were put in place?
Human rights standards require that measures are put in place to ensure that nobody is
allowed to fall below the minimum safety net needed to guarantee a dignified life.
Unfortunately, this is routinely being ignored in even the largest economies as we see ever-
increasing numbers of homeless people and the growth of food banks; charities and
communities are responding to welfare cuts by stepping in to prevent people going hungry.
There is no question that many national budgets are under strain. But are governments
making the maximum use of all the potential resources at their disposal, as they are required
to do under human rights law? The November 2017 release of the so-called “Paradise Papers”
revealed the vast extent of tax evasion and aggressive tax avoidance around the world,
demonstrating the systematic failure of governments to close loopholes and monitor and
address abuses. It has been estimated that Brazil alone is losing up to USD80 billion a year as
a result of tax evasion (which calls into question the need for a 20-year spending cap), while
African countries could collectively claw back at least the same amount annually. In addition to
the well-known tax havens, a 2017 study showed that countries including Ireland, the
Netherlands, Singapore, Switzerland and the UK are facilitating tax evasion by people in other
countries. Globally it is estimated that the annual figure could be as high as USD10 trillion.
Extraordinary times require the consideration of radical alternatives. A number of ideas have
been gaining traction during 2017. They include the introduction of a universal basic income –
already being piloted in some countries – which would guarantee everyone enough money to
live on, regardless of circumstances. Another proposal would involve the state paying for all
key basic services rather than leaving it to the market. Of course such ideas have their critics:
Where will the money come from? Will it simply encourage people to live off the state, even if
they are in a position to work? Nevertheless, proponents point to the potential longer-term