Resources are critical to the realization of economic and social rights. Article 2.1 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) states that “Each State Party to the present Covenant undertakes to take steps, individually and through international assistance and co-operation, especially economic and technical, to the maximum of its available resources, with a view to achieving progressively the full realization of the rights recognized in the present Covenant by all appropriate means, including particularly the adoption of legislative measures.” The Maastricht Guidelines on violations of economic, social and cultural rights clarifies that a state is in violation of the Covenant if it fails to allocate the maximum of its available resources to realizing human rights.
This report examines the many ways that governments can access financial resources in order to fulfill its obligation to use ‘maximum available resources’ (MAR), as first introduced in the Covenant. It draws on a rich set of discussions between economists and human rights experts who met at the Center for Women’s Global Leadership on December 13-14, 2010. Although the UN Committee on Economic, Social and Cultural Rights, the UN Committee on the Rights of the Child, several UN Special Rapporteurs and other legal experts have made some notable headway, further clarification on what the concept of maximum available resources means and how states can apply it in practice is needed. Often a narrow interpretation is adopted, assuming that available resources have been fixed by previous policy choices and that the government’s main duty lies in efficient administration of these resources. Therefore, the practical applications of MAR have tended to limit analysis to budget expenditures and international assistance, while overlooking other determinants of the full set of resources available to realize human rights—including monetary policy, financial sector policy and deficit financing.
The UN Committee on Economic, Social and Cultural Rights made a statement in 2007 entitled, “An Evaluation of the Obligation to Take Steps to the ‘Maximum of Available Resources’ Under an Optional Protocol to the Covenant.” However, the statement did not define what constitutes ‘available resources’ beyond stating that it refers to “both the resources existing within a state as well as those available from the international community through international cooperation and assistance.” However, it has used the following indicators in assessing a government’s compliance with this obligation:
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Comparing economic, social and cultural rights (ESCR) related expenditures vs. expenditures for non-ESCR related areas.
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Comparing expenditures in an area (e.g., education, health) with expenditures in the same area by countries at a comparable level of development.
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Comparing allocations and expenditures against international indicators, such as UNDP’s indicator that 5 percent of GDP should go to human expenditures (which for poor countries are specified as basic education, primary health care, and basic water.)
We note that these indicators focus only on government expenditures and international assistance.
The UN Convention on the Rights of the Child and the UN Convention on the Rights of Persons with Disabilities are both explicit about State parties’ obligations to take steps to use the maximum available resources to ensure economic, social and cultural rights. Further, the Committee on the Rights of the Child has already integrated the concept into one of its General Comments,4 in its Concluding Observations to several State parties reports,5 and held a Day of General Discussion on the topic “Resources for the Rights of the Child - Responsibility of States: Investments for the Implementation of Economic, Social and Cultural Rights of Children and International Cooperation.” This Committee has expanded the substantive meaning of resources to include “human, technical, organizational, natural and information resources,” and has put special emphasis on the State obligations to contribute to global or extraterritorial implementation of these rights. Like the ESCR Committee, however, it has not yet identified the full range of potential financial resources for ESCR realization.
Several UN Special Rapporteurs and Independent Experts have also addressed the meaning of ‘maximum available resources.’ The former Special Rapporteur on the Realization of Economic, Social and Cultural Rights Danilo Türk noted that:
Progressive (as opposed to regressive) measures of taxation can, if supported by adequate administrative machinery and enforcement mechanisms, lead to gentle and gradual forms of income redistribution within States without threatening economic stability or patterns of growth, thereby creating conditions that enable a larger proportion of society to enjoy economic, social and cultural rights.
Magdalena Sepulveda, the Independent Expert on the Question of Human Rights and Extreme Poverty, has drawn the following conclusions with regard to the obligation of governments to use the ‘maximum of available resources’ to realize ESCR8:
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Governments must mobilize resources within the country to its utmost ability.
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Government expenditures must be efficient (the ‘efficiency criterion’ could
also be applied to revenue collection).
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Government expenditures must be effective.
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Failure to curb corruption is a failure to comply with the obligation.
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Funds earmarked in the budget for ESCR must not be diverted to non-ESCR areas.
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Funds earmarked for ESCR must be fully expended for that purpose.
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Governments that introduce regressive measures, such as cuts in expenditure on ESCR, must show that they have used the maximum of available resources to avoid taking such a step.
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Governments must do all they can to secure international assistance where national resources are inadequate to realize ESCR.
Her conclusion points to the importance of resource mobilization, as well as of expenditure policy and international assistance.
Olivier de Schutter, the Special Rapporteur on the Right to Food, in his 2009 report on Brazil, draws attention to the role of taxes in fulfilling the obligation to using the ‘maximum available resources’:
The tax structure in Brazil remains highly regressive. Tax rates are high for goods and services and low for income and property, bringing about very inequitable outcomes. [ ... ] while the social programmes developed under the “Zero Hunger” strategy are impressive in scope, they are essentially funded by the very persons whom they seek to benefit, as the regressive system of taxation seriously limits the redistributive aspect of the programmes. Only by introducing a tax reform that would reverse the current situation could Brazil claim to be seeking to realize the right to adequate food by taking steps to the maximum of its available resources.
The human rights community has recognized the importance of government revenues, including taxation and official development assistance, to the concept of maximum available resources. Economists would agree that resource availability for realizing human rights depends on expenditure, aid and taxation, but also point to the possibility of borrowing and running a budget deficit. Some economists refer to this as the ‘fiscal space diamond.’ The four points of the diamond are expenditure reprioritization and efficiency; domestic resource mobilization through taxation and other revenue raising measures; foreign aid grants (Official Development Assistance); and deficit financing. In addition, we add the monetary space which depends on central bank policies. These policies influence the interest rate, exchange rates, foreign exchange reserves, reserves in the banking sector, and the regulation of the financial sector. The monetary space also influences the resources available to realization of ESCR; for instance through its impact on the level of employment and the utilization of productive resources. When central bank policy does not support full employment, this reduces available resources.
We consider, among other issues, how fiscal and monetary policy decisions influence the resources available for realizing rights and how policy instruments can be used in ways that are in compliance with human rights principles, such as non-discrimination, progressive realization, participation, transparency and accountability. The concept of maximum available resources requires further development in order to challenge the unequal distribution of material resources, and re-imagine the role of the state not only as an efficient administrator of existing resources, but as an institution that mobilizes resources to meet core human rights obligations.
The report is organized around five topics which are essential to sustainably maximizing resource availability to realize human rights: (1) government expenditure; (2) government revenue; (3) development assistance (both official development assistance and private resource flows); (4) debt and deficit financing; and (5) monetary policy and financial regulation. Together, these inter-related policy areas can be represented in a diagram with five critical nodes for mobilizing resources.
