Transcript Supporting Russia as emerging donor and a global

Public policy in support of
mobility and the case of Russia
Northern Restructuring Project
Government of Hungary – World Bank
Conference on
Social Inclusion in Eastern Europe and Central Asia
Budapest, September 2007
Andrei R. Markov
The World Bank
[email protected]
This presentation
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The rationale of public policy for mobility in
ECA:
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Economic reform related considerations;
Extreme case of the Russia North.
Main features of the Northern Restructuring
project
NRP results and outcomes
Lessons for mobility/migration support policy
Public policy for increased
mobility in ECA – Why?
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Correct the legacy of inefficient spatial distribution of
settlements and population generated by command
economy
Permit labor inflow to primary urban aglomerations
associated with increased economic growth
Reduce high barriers to mobility:
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Information (on jobs, housing) is scarce and costly;
Housing and rental markets underdeveloped;
Private sector mobility support rare (while movement is
cash intensive process).
Address social dislocation and exclusion associated
with increased mobility (take care of immobile
groups)
Russia Northern economic
development – a case for inefficient
spatial allocation
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Massive case of Northern subsidization (up to 4,7%
of annual Soviet GDP)
Growth of Russia Northern Population, particularly in
urban fully fledged settlements
Increase of the “Cost of Cold” - Temperature per
capita went down leading to increased costs of GDP
production
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Russia became “colder” from min 11.6 to 12.6 C in 19301990
Canada became “warmer” from min10 to min 9 C in 19301990
Economically “excessive” population in Siberia
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10-15.7 mlns by econometric calculations (up to 1/3)
Economic shock of the 1990-s
and the Russian North
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Market liberalization of 1992, elimination of unaffordable
subsidization and industrial contraction of 20 to 55% ;
Spontaneous contraction of the Northern population
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Most resourceful, skilled and mobile left.
Sharp increase of pensioners’ share in the population
Imbalance of municipal budgets, increased pressure on social
and municipal infrastructure;
Reduced access to services and interruptions in supplies
because of budget and capacity constraints;
Major increase in number of Northern population seeking public
support for out-migration from the North (up to 800000).
Net Migration in the Russian Far
North, 1979-2005
Net Migration in the Russian Far North, 1979-2005
150,000
100,000
Perestroika period
50,000
0
-50,000
-100,000
-150,000
-200,000
Price liberalization,
economic reforms
-250,000
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
Northern Restructuring project
($80 mln, effective 2002)
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Dual Mission:
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Main principles:
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Improve sustainability of municipal budgets
Facilitate out-migration of socially vulnerable groups
Subsidize voluntary out-migration from three Northern
municipalities,
reduce barriers for mobility,
generate savings out of reduced population.
Main project components:
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Migration allowances issued through certificates;
Information system on housing in the “Mainland”;
Information and PR campaign;
TA for infrastructure consolidation and HCS management reform.
NRP - Geographic dimension
NRP – Vorkuta case
NRP- outputs
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4527 households (10028 people) migrated from the
North
Housing information system in place/ push to real
estate market development
600000 sq. M of consolidated housing
Complete reorganization of Susuman district (from
large permanent population to seasonal+core
sceleton population)
Isolated Settlements closure in Vorkuta
(Promishlennij, Maldijak, etc).
NRP- economic results
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Consolidated budget savings:
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$9.5 mln from out-migration;
$12.6 mln from infrastructure consolidation;
Project full cost recovery – less than 5 years.
Reduced federal budget obligations for out-migration
support
Improved efficiency of service delivery in the North
(HCS unit costs reduced by 14.5%)
Improved quality and access to social and HCS
services in the North
Improved coverage of population by targeted social
assistance from 4 to 15 % of households
NRP – lessons for public policy
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Understand the linkage of mobility and economic
development;
Identify “natural” migration directions
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Be aware of “push” and “pull” factors
Reduce barriers to migration
Prevent clustering of migrants in recipient localities
Voluntary participation in migration programs
Be aware of immobile groups – address their needs
through other means
Social monitoring, program redesign and operational
feedback are KEY to success
Thank you