Identifying Fiscal Space: Options for Social and Economic Development for Children and Poor Households in 182 Countries
It is often argued that social and economic investments that benefit children and poor households are not affordable or that government expenditure cuts are inevitable during adjustment periods. But there are alternatives. It is critical for even governments of the poorest countries, to explore options that ramp up social spending and employment-generating economic investments during—and in support of—the recovery.
This working paper offers an array of options that can be explored to expand fiscal space. These include: (i) re-allocating public expenditures, (ii) increasing tax revenues, (iii) lobbying for increased aid and transfers, (iv) tapping into fiscal and foreign exchange reserves, (v) borrowing and restructuring existing debt, and/or (vi) adopting a more accommodative macroeconomic framework. To serve as a general advocacy resource, the annex provides a summary of the latest fiscal space indicators for 182 countries.