 Good morning to everybody. I'm supposed to be setting the discussion and provide some of the wider trends on inequality. A lot of this work was done in UNICEF and I always like to start by the distribution of world income. Most of the presentation is focused on income. And this is what we have here is the global income distribution by countries from 1990 to 2007, so it's an acceptably long series. In PPP constant prices 2005. And the thing is, this is the most conservative assessment you can do, you will looking at that. And no matter that, what you have is a very unequal distribution of income. What you have on top is the top income quintile that will be the richest 20% and at the bottom the poorest 20%. And what you can see there is that the top income quintile has more than 70% of global income. There are many ways to calculate that and that will be in constant US dollars, many at market rates instead of adjusted by PPP. And if we do that, actually we do get much significantly differences in income. In that case, as you can see, the top richest 20% actually has more than 80% of world income and the poorest has hardly one percent. It's also interesting to know that the top 1% or 61 million will have the same as the poorest 3.5 billion or approximately half of the world population. So the figures are very striking. This party is large. And there is some sign of progress if you see actually the darkest line, the darkest bar reflects 1990 and the lightest bar, the most recent data that we had at the time, which was just prior to the crisis 2007, 2008. So it's some sign of improvement but the problem is the rate. And we estimated that at the current rate of progress it will take about 800 years for the bottom billion that is the bottom 20% to achieve 10% of global income. So there is no reason to claim victory no matter there is some progress. These are all different ways to visualize it and calculate it. You have, there are different methodologies. You have them all in the UNICEF paper that is quoted and referenced at the end. This is about the distribution of world GDP and this follows some work initially done by UNDP in 1989 and which we updated on the right-hand side. Here what is interesting to note is when this figure came up and that's why we kept the UNICEF, sorry the UNDP first figure. Is that the distribution of world GDP has the shape of a glass champagne glass. That's one of the expression by Peter Heller from the IMF and when he saw it he says, oh God it has the shape of champagne glass and it remains having that shape as you see with the latest numbers in 2007 it remains having that shape more or less and it focuses the attention that clearly the issue is the top, not just 20%, is the top 10% really that seems to accrue all the benefits from world income. Now that figure is also interesting because we were just a number of us at the annual meetings of the bank and the fund in Washington and as you might be aware, the bank is moving ahead. Now the mission is not only to reduce poverty but to have shared prosperity and the notion of shared prosperity at the bank is understood mostly as how much accrues to the bottom 40% of the population. Now this is meant to be by country so it's meant to be for national analysis and not for a global analysis but if we look here at the global analysis you'll see that actually the bottom 20% is actually the extreme poverty more or less that will be the $125 a day that's what you get in quintal one and quintal two is actually the poverty rate at $2 a day adjusted. So that is, it shows how the extent of the bank mission. This is another way of visualizing inequality and what we have here is a mix of two things on the one hand by countries and that will be at the bottom at the very end what you have is the richer countries and at the here the close end where you have is the poorer countries and then you have quintals so it's a way to visualize it too. So at the far left what you have is the richer quintiles and that here closer to us the poorer quintiles and what you see is the very, very top bars. They actually reflect the richer quintiles of Luxembourg, United States and Singapore. You have the numbers there and in the bottom right you have the numbers and in the paper and you were looking at the poorer, poorer quintiles and countries what you will have is the Democratic Republic of Congo, Liberia and Haiti. So this is interesting to visualize income inequality from a global perspective and we will come back to it at the very end to open the discussion for Richard because in a way it puts the attention on the importance of international factors too. Not all is about national strategies. These are the results and just to mention and actually praise the excellent work of UN Wider because at one point they did not even, they not only launch data on income inequality, they actually worked on wealth inequality for some time and that studies on wealth inequality reflected even larger disparities and inequalities than income and again most income inequality measures are based a lot on household consumption and wages and they do not reflect other household wealth like such as financial assets or real estate and these are the typical instruments that the wealthy will have so then disparities become even wider and again to focus the attention we are only talking about income but inequality of course goes across the board in many other areas, any area really and this reflects work we also did in UNICEF and this is about reductions on under five child mortality rate and this is a country like Namibia. Namibia will achieve the MDG goals and if you see the aggregate numbers, the statistics, you will see that in 1992 had an under five mortality rate of 72 and now well in 2008 has a rate of 42 so it looked that he has a very progressive and solid path but however when you see who is benefiting and who is really doing well in the under five mortality rate, it shows is the clear part which represents the higher income group. Really most of the progress of Namibia is due to this higher income group and the same you could do for many other things and this is a lot of studies in UNICEF that came out after the inequality discussion was open, child stunting that comes from India and again most of the progress comes because of the improvements at the richest 20% but when you look at the poorest 20% they keep doing not so good. In any case most of the data we had at the time they were up to 2008, 2007, 2008, sometimes 2009 so the key question is what has happened with inequality during the crisis and incipient recovery we are experiencing so following the path actually of Andrea Cornia and Richard Jolie and Francis Stewart when they came with the excellent work of adjustment with a human face we started a new series of work as a recovery with a human face and we tried to see the social impacts of the current crisis which were not easy to determine given the limited number of data, real time data on social issues. So here are the main transmission channels of inequality. We know that it had negative impacts on employment and income through a variety of channels and here we are here in ILO so this is not important, no news for you. They were also in important transmission channel which was prices and that means prices of food, agricultural inputs, fuel, medicines and drugs. All those have negative impacts on households. Also negative impacts and transmission through assets and credit, many lack of access to credit, savings, et cetera and then a foreman area it has been government spending on economic and social sectors particularly after 2010 and we are going to go a bit on detail on those. This is food prices as we know we had the main spike in 2008 and then a new one in 2011 and prices continue very high. What is more important to know is that prices are sticky and this is not really known why is the process but the international price once it reaches the national economy actually remains very high at national level. This comes from an FAO series of local prices and this is the blue line and this is very interesting to see that despite you have the international price goes down in 2009 at local level actually it gets less in parallel so it remains extremely high. There are a number of suggestions and research going on on why these local prices are sticky but it's something very important to observe because of the negative impacts on households, household income. We are again in ILO so I'm not going to go into this one in detail but we experienced a long job crisis, it's not a short one, certainly the crisis has worsened that tendency with the only exception of Latin America which has been increasing the demand for labor. Actually the rest of regions have experienced a long decline since 1990 and that is part of the development agenda we are carrying and we go later. And then something less known but we have been highlighting very strongly and the latest report is the ILO World Social Protection report that I encourage you to read is that a number of countries are contracting public expenditures. Now everybody thinks of Europe but this is much beyond Europe. Actually in this year as we are talking according to IMF fiscal projections 122 countries are contracting public expenditures of which 82 are developing countries. So it's not only a European phenomenon it's a policy approach that is happening in many countries and this is peculiar because during the first crisis of the crisis, under the first phase of the crisis sorry, it's 2008, 2009, most countries embarked in fiscal stimulus plans. We estimate about 2.4 trillion was spent in fiscal stimulus of which about 25, a quarter of it was spent on social protection measures. So from a kind of household point of view despite the crisis had very negative impacts on employment and on contraction of economic activity there was a response which was positive in the first phase 2008, 2009. The problem comes in 2010 when there's a change of approach but before going to that I wanted to showcase a bit at the policy preference done at the time and what this represents at this pyramid is how much was invested in bailing out the financial sector in 2009 how much was spent on stimulus plans and to bail out the financial sector is estimated on committed numbers it was about 11 trillion globally. Fiscal stimulus plans were about 2.4 trillion globally in a number of countries then there was a big commitment towards the IMF to invest more in developing countries but that is only the little tip of the iceberg that you see that is the yellow bit that it was 0.7 trillion so below one trillion and finally on green which you cannot even see is how much that year was developed to an ODA development aid which it was 0.1 trillion. So that to put things a bit on perspective and what we see is that the policy solutions of the crisis have prioritized financial sector over socioeconomic recovery. This is small graphs and you have these graphs in the ILO World Social Protection Report but what you have first in the big column is how much again was committed to the financial sector to financial sector support how much was to fiscal stimulus packages which relatively was few and that led to a significant increase on gross national debt 2008, 2010 that's just the increase which now is being passed into populations because they are the ones that through fiscal consolidation and different set of cuts mostly to things that have negative social impacts do impact populations. A number of countries and going back to the cutting and how this will be affecting inequality about a fifth of all world countries are going excessive contraction and we define that as going below pre-crisis expenditure levels going below pre-crisis levels. So it's about a fifth of countries some of them very markedly and what are the typical adjustment measures and we mostly know these through the European discussions but if we look at all developing countries and this is an analysis based on 314 IMF country reports so yes, we spend a lot of time looking at that. The most common measure used is actually cutting subsidies reducing subsidies. It follows by cuts or caps on the wage bill. Then this is another measure that impacts households is increasing consumption taxes like BAT then a number of countries are planning pension reforms and 47 of their developing countries so it's not only a European thing and very often what you see in the IMF country reports is that instead of expanding social protection they talk about very well targeted safety nets you see but the crisis is not the time to target that crisis is a time to precisely expand the social protection network and not to target and other countries have health and labor reforms. You know, it's a crisis of social support that is expected to increase inequality. So going back to the inequality discussion we look at a long series and this comes from Milanovic at the World Bank that did the phenomenal effort to put these long series starting in 1820 so what we see is inequality has been increasing over time and of course the most known here work is the one recent work of Piketty and that is looking at different set of data mostly coming from tax, income tax records and this analysis using Piketty data was done by Jomo and Popov in 2013 and this is a very nice article because it links actually the evolution of income for the top 10%, 5%, 1% and links it to different policy measures and you can see there is a reduction in the number of countries that Piketty series is use there is a reduction since the Russian Revolution towards the late 70s then there's a transition period since let's say the fascist Reagan governments and then a significant increase in inequality since the fall of the Berlin Wall. So that means that policies do matter and so there is a change in the type of policies prior to the 1970s and then after the early 80s that change of policy does create a different set of results regarding income and by now what has happened is that the United Nations for long has been actually debating these orthodox policies that have led to an increase in inequality and proposing another agenda which is what is called the UN development agenda which is for all and this is critical to bring equity to the development agenda. So what I have tried to do here and in the two columns what you have in the left column is the traditional orthodox policy advice that was used in the 80s and 90s which some call the Washington Consensus so we understand and then the emerging actually the current consensus of a UN development agenda for all that emerges after the 2000s. And so typically and I'm not going to go into detail into that but the 1980s and 90s were based on growth as a priority through the regulation free markets minimally governments and very residual social policies and the UN development agenda for all is based mostly on growth and equity through active promotion of national development and somehow integrating economic and social policies so economic policies attend to the social impacts and that is critical because part of why income inequality has been growing like that is because of the linking of macroeconomic policies from any social impact. So the macroeconomic policies mostly has focused on inflation and the stabilization instead of focusing on real output incomes and employment that will be a main difference of this agenda and we have other aspects which are I don't know if to go into detail I mean there has been traditionally in the orthodox approach towards fiscal discipline and avoiding a focus and avoiding fiscal deficits however there is in the current UN agenda the development for all is proposed the need of public investments for development and to expand government's fiscal space that is critical to generate again more output from a social point of view from the social angle and again I'm director of social protection so I need to put it. This is this other slide typical orthodox policy advice was always focused on residual approaches to social policy normally very minimal and always targeted to the poor very often safety nets while the new UN development agenda is focused on universal policies that means for all and bringing redistribution back to the development agenda to give you some examples of that in the 80s and 90s it was a big push to commercialize social services and bring the issues of cost recovery like fees for services and then the UN development agenda for all really were talking about public services and free when possible and for instance a good example is the UNICEF school fee abolition initiative that now widely accepted. On labor issues very much the orthodox policy advice of the 80s and 90s was focusing on labor flexibility and productivity mostly through very micro approaches one nowadays the ILO decent work agendas more or less acknowledged in global discussions. In terms of social security a lot of the efforts of the 80s and 90s focused on the privatization of social security mostly pensions through funded pillars and reforms of the welfare systems while now we are talking about social protection floors for all that means universal and a number of countries already six are reversing pension privatizations started in the 80s and 90s. We could go on human rights appear in the discourse on the 80s and 90s but nothing happens while now in the new agenda this focus to empower people to use rights and standards and it keeps on but you know a major issue that actually has spill overs it's at the 80s and 90s it was no attention whatsoever to political issues, culture of failures and sources of conflict because they were considered political issues and not interesting while now there's a main focus on conflict prevention particularly UNDP and this is an important issue to highlight. And now these orthodox policies I mean it's not just a distinction that we are doing they actually aggravated poverty and inequality massively and these are numbers that come from WHO but the remarkable work done by Andrea Cornia and his colleagues showed how actually infamortality rates actually rose significantly for poor segments of society in extensive number of countries in the 80s and 90s as a result of these policies. So what we find today is the opposite it's an enormous case for equity and there are a number of reasons one is social justice and that is a praying in a number of claims and protest that people are doing but critically for us that we are more worried on development the key issues that equity actually does contribute to economic growth and actually the current concentration of income inequality is very dysfunctional from an economic point of view. Consumption is just focused and concentrated on the very, very top deciles of society and actually impeding national development. So our main argument has been the need to make income distribution more equal so as a way to foster national demand and consumption. And that particularly is very interesting to see that the evolution of some countries and some Asian countries, Latin American too because after 2011 because of the wall had the press demand because of the crisis many of them like China started changing doing a policy reversal about income distribution and China for instance started developing social protection widely, massively to the point that is nearly achieving a universal pension coverage in a very short time frame. So this is a very positive trend and that is followed by a number of countries and clearly an important issue is that also equity builds political stability that is an important issue we need to understand. We did a number of work showing how inequality slows down economic growth here's 94 developing countries. If we relate the annual GDP per capita to genie indices actually you find that more inequality slows down economic growth. We also found a relation between inequality, violence and crime and others that I'm not presenting here but you have all that in the UNICEF study. The thing is that all this policy reversal can lead to an equitable recovery. If we look in the 1929 the financial crisis led to a new deal that altered the development model of the day, stimulating economic growth and development regulating the financial sector and expanding social security or social protection and a comparable policy push is needed today and is not too late and some countries are doing it. How to bring equity to development agenda however will take a bit more than these three elements that we said and in a way what we will need is to look at each sector, each investment sector from agriculture to industry, housing, finance, energy and mining you name it and think how will you bring equitable impacts and so what we have here is a summary of typical interventions with equitable outcomes and typical interventions within equitable outcomes and this is based of about a decade of research mostly by DFID, the bank, and several UN agencies on different sector investments. So let me put an example, if you pick agriculture you could have large investments perhaps that only benefit the major land owners. Okay, so you put a lot of money into an irrigation system. Okay, very different if you put your investments into food security, land redistribution, and others that will have very equitable impact. So like that you could go sector by sector. Let me give another example in finance what is very demonstrated effects to have equitable outcomes will be to develop rural banks branching out to local areas, managing finance, fighting illicit financial flows and typical intervention that will have inequitable or aggressive outcomes will be financial liberalization, rescuing bank systems which will simply transfer direct transfer to large banks or subsidies to large private enterprises. So in all it will require taking, looking at all these aspects from all the sectors. So it's not a magic solution to bring equity to the development agenda. It will not happen only because of three interventions or to be too focused. It's actually, it will happen because you are mainstreaming equity across all the different investments that the society has to do. Now of course I come from social protection so this is the commercial. So social protection actually has very quick impacts. On poverty reduction they are immediate. If you do a transfer to a household immediately they reduce poverty. But inequality also and these are some numbers and that is a reason why you have a massive expansion of social protection in a large number of countries today. And this is a very positive phenomenon that is very much welcome. Question that it always comes is but where is the fiscal space? Well this is part of the new agenda and the thing is there is national capacity to fund socioeconomic investments in virtually all countries. There is at least seven options all supported by the United Nations and by the IFIs and they go from reallocating public expenditures to increase tax revenues, fighting illicit financial flows, could be loving for eight, though eight is decreasing, tapping into fiscal and foreign exchange reserves, restructuring debt and adopting more accommodative macroeconomic frameworks. Just to finish, we are talking here mostly about a national development agenda but the national development agenda has limits. And if you look at this figure, you'll recall it's putting countries on income levels. So let's pick that we pick one of the middle middle income countries there. So what you see, you can do some redistribution from the richest quintile to the poorest but in all, the big disparities are international. So that means that it's very important to address inequality in an international development agenda through trade, adequate trade arrangements, international finance and others. Thank you.