Will Congress Revoke IMF Funding?

By Russell Mokhiber and Robert Weissman, AlterNet. Posted October 16, 2000.

There is no policy of the International Monetary Fund (IMF) and World Bank that is more stupid, cruel and brutal than the insistence that poor countries charge fees for children to attend school and for people to access basic health services.

The IMF and World Bank condition loans to impoverished countries on the adoption of Contract with America-style "structural adjustment" policies. User fees -- also known as community financing, cost sharing or cost recovery -- are often one part of the structural adjustment policy package.

In passing an appropriations amendment in July that would stop future funding for the IMF and the World Bank if the two lending agencies do not stop imposing user fees for basic healthcare and education services, the U.S. House of Representatives has taken an important step toward ending this callous and wrongheaded policy.

Unfortunately, the Treasury Department, anxious to avoid any appropriations limitations for its IMF and World Bank policy arms, is working to block inclusion of the amendment in the final foreign operations appropriations bill. As administration officials and members of Congress and their staffs negotiate the terms of a final foreign operations appropriations bill, the educational opportunity and health of millions of people in the world's poorest countries hang in the balance.

The evidence accumulated from around the world over the last decade is quite clear. User fees for education lower school attendance rates, especially among young girls. User fees for primary health services deny access to care and preventative treatment for the poor, leading to the spread of unnecessary and preventable death and disease. And user fee "exemptions" for the poor, or sliding payment scales, routinely fail due to administrative problems, corruption, inadequate notice to the poor or other difficulties.

* In Gambia, in primary health care program villages with insecticide provided free of charge, bednet impregnation -- for malaria prevention -- was five times higher than in villages where charges were introduced. Households consistently cited lack of money as the main reason they chose not to dip bednets.

* Introduction of a 33 cent fee for visits to Kenyan outpatient health centers led to a 52 percent reduction in outpatient visits. After the fee was suspended, visits rose 41 percent. In Papua New Guinea, the introduction of user fees led to a 30 percent decline in outpatient visits. Studies in Niger have found that user fees extend the period that patients wait before seeking outpatient care.

* UNICEF reports that in Malawi, the elimination of modest school fees and uniform requirements in 1994 caused primary enrollment to increase by about 50 percent virtually overnight -- from 1.9 million to 2.9 million. The main beneficiaries were girls. Malawi has been able to maintain near full enrollment since that time.

* In India, reports Dr. Vineeta Gupta, general secretary of Insaaf International, a Punjab, India-based organization, a World Bank-inspired system which is supposed to exclude the poor from healthcare charges fails in practice due to corruption and administrative difficulties, denying the poorest Indians access to healthcare services.

The purported logic of education and healthcare user fees is that payments from children's families and sick people will enable government service agencies to provide services to more people.

But this is a twisted rationale, which should be rejected on both principled and practical grounds. As an issue of principle, access to primary education and healthcare is a right that should not be conditioned on ability to pay.

In practical terms, the real-world record shows that user fees deny children educational opportunity and people of all ages access to basic health services. Charges typically generate little revenue in any case. So the ultimate result of user fees is service denial, not expansion.

The IMF/Bank user fee rationalization presents a false choice: even poor country governments have multiple sources of potential revenue there are ways to increase funding for basic services without imposing charges. Most importantly, the real way to free up resources for education and healthcare is for the World Bank and IMF, without delay, to use their existing assets to cancel the debts owed them by poor countries.

There are no significant corporate or monied interests served by the imposition of user fees in desperately poor countries. The IMF and World Bank continue to support them out of a dogmatic commitment to a marketized ideology that refuses to concede to empirical refutation. The Treasury Department is opposing corrective legislation so that it can preserve its control of the IMF and World Bank without Congressional interference.

These are shameful counterweights to the humanitarian imperative of removing user fees. Whether the humanitarian claim prevails will depend, in significant part, on whether U.S. citizens act now to put an end to user fee nightmare.

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