Why fair tax is key to breaking barriers to girls’ education

https://www.globalpartnership.org/blog/why-fair-tax-key-breaking-barrier...

Since 2018, and with support from the Norwegian Agency for Development Cooperation (Norad), ActionAid and its partners have been implementing the Breaking Barriers project, working together to tackle the key barriers to education for some of the poorest and most marginalized children across Malawi, Mozambique, Nigeria and Tanzania.

As part of this work, the project teams in all 4 countries have been advocating for governments to increase the amounts of money available to spend on free, quality, inclusive public education.

This has included not only an emphasis on ensuring the share of funds allocated to the sector is in line with internationally agreed financing benchmarks of 15-20% of the budget or 4-6% of GDP, but also a call for governments to step up their efforts to increase the size of their overall budget through fair and progressive domestic resource mobilization.

In addition, by supporting civil society organizations and community members to actively scrutinize the way education budgets are spent, focusing on the importance of sensitivity to the needs of girls in particular, the project has managed to break down some of the many barriers preventing some of the most vulnerable children from enjoying their right to education.

Malawi has long prioritized funding to education as a share of its overall budget. However, a relatively low tax-to-GDP ratio combined with significant revenue losses resulting from corporate tax incentives and double-taxation agreements, as well as high debt-servicing obligations, means that the actual amounts available to spend on education fall far below the very real needs across the country.

Therefore, it is essential to ensure the amounts that ARE available, are spent as effectively, efficiently and transparently as possible. Indeed, a recent education budget report by UNICEF notes that although the fiscal space to increase education sector budgets remains very limited, there is potential for doing more with available resources by improving efficiency and equity of expenditures.

Among the many activities carried out as part of this project, ActionAid Malawi provided ongoing training to 40 members of the Ntchisi district Tax Justice movement (including young women, activists, and school pupils) on issues related to taxation and gender responsive public services.

It also gave them the skills to conduct their own analysis of gaps in public-service provision (especially education and health) in their area and helped them mobilize to demand accountability on the part of duty bearers for progressive taxation and accountable use of taxes to benefit the community.

This small group then went on to step-down what they had learned to a further 300 community members, a process which in turn revealed issues of transparency and accountability where usage of tax revenues was concerned including, importantly the failure to adequately fund the school fees of around 35 vulnerable secondary school pupils whose education had been severely impacted as a result.

Lackson Banda, Chairman of Kasakula Youth Activista Network recounts how the training from ActionAid Malawi helped community members hold duty-bearers to account for the use of the Constituency Development Funds (CDF):

Lackson admits that at first, it was not easy to get hold of duty-bearers, but the activists persevered, and were able to secure Constituency Development Funds to support 35 needy students.

One of the bursary beneficiaries, 20-year old Abgail Chilembwe, a form four learner at Kasakula Secondary School expressed her appreciation for the results:

Engaging with Government stakeholders in implementing project activities has had positive outcomes as witnessed by the support of the Ntchisi District Education Manager, Mr. Pauper Mkandawire. He says:

The clearly impactful work being done at district level is mirrored by evidence-based advocacy work being carried out by ActionAid Malawi and its strategic partners at national-level.

ActionAid Malawi has continuous engagement with the Education and Finance Parliamentary Committees, Ministries of Finance and Education, advocating for an increase to allocations to education to ensure that the country maintains allocating the lion’s share of the national budget to the sector and scrutinize these allocations. One of the sustainable ways of achieving this is through increasing its tax-to-GDP ratio through fair and progressive taxation.

In 2018 findings from ActionAid’s ‘Making Tax Work for Girls’ Education’ highlighted the fact that an estimated US$ 87 million was lost to tax incentives and tax treaties alone. Further research conducted and launched by the organization in 2020 suggests that just six progressive tax reforms in Malawi, could translate into a 2% increase in Malawi’s tax-to-GDP ratio, an estimated US$ 135.1 million.

If just 20% of these new revenues were allocated to education (as per the international benchmark) this would equate to around $US 27million, which ActionAid estimates would be enough to cover the cost of school places for all out-of-school children for one year.

Given the ongoing impact of the pandemic and the resulting constraints on financing to critical public services such as education, ActionAid and partners will continue to advocate that governments honor commitments made at the Global Education Summit in 2021 and push, not just for allocations that are in line with globally agreed benchmarks but also allocations that are transparently spent and sensitive to the needs of the most vulnerable, especially girls, helping break down the barriers they face.

One way in which Action Aid is also doing this is by joining the GPE-IPNED Project Advisory Group as both organizations work to develop a parliamentary toolkit on domestic education financing, to support engagement of parliamentarians in budget discussions, including fairer allocation of resources to reach marginalized group such as girls.