Financing for gender equality: short of the mark III/IV

In recent years, states, donors and businesses have all talked about investing more in women and girls. But while more money to support women and girls is of course a good thing, these investments have too often not materialised or have had very limited impacts. For example, the OECD DAC Network on Gender Equality shows that despite good intentions, donors’ investments in women and the economy have been stagnant since 2007. In 2011 and 2012 only US$469 million – just 2% of all bilateral aid was directed towards initiatives that had women’s economic empowerment as a principal objective. As emphasized above, raising and spending revenue on public services is vital to address women’s inequality in work – and are often under the squeeze. Moreover, in countries where data is available, levels of spending by ministries or agencies specifically responsible for women’s rights and empowerment is shockingly low and not more than 0.4% of GDP.
Another vital issue is that tax policies are often (explicitly and implicitly) biased against women – pushing them further to the bottom of the economic pile. Explicit biases are easy to identify. In Morocco, for example, joint income is automatically assigned to the man as the person filing the tax return on behalf of the household. Implicit biases are usually reflected in indirect taxation, such as Value Added Tax (VAT), and have a disproportionate impact on women because they are primary care givers and the main consumers of the basic household products. Underinvestment in women entrepreneurs is also a global phenomenon, despite the evidence that womenled companies may deliver higher and more consistent returns.
Women launching businesses around the world have an estimated collective credit gap of US$320 billion. In Africa, female-owned companies in the formal sector in urban areas have 2.5 times less start-up capital than male-owned equivalents. Increasing women’s access to microcredit – a popular strategy in recent years – can only be a partial response and has a troubling record of increasing the workload and debt burden for the poorest women.

http://www.actionaid.org.uk/sites/default/files/publications/womens_rights_on-line_version_2.1.pdf