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World Bank: Roma integration is of economic benefit

Prague, 4.10.2010 18:38, (ROMEA)

According to a World Bank (WB) study, the inclusion of Roma into society, specifically the provision of equal opportunity for their access to employment, is economically beneficial for all parties involved – for the Roma, the larger society, and the state. Joost de Laat, a World Bank economist studying human development in Europe and Central Asia, presented the study at a meeting of the International Steering Committee of the Decade of Roma Inclusion in Prague last week.

VIDEO
Press Conference - 19th International Steering Committee Meeting - Decade of Roma Inclusion (czech)
Interview with Jan Jarab, Regional Representative, Office of the UN High Commissionaire for Human Rights (czech)
Gabriela Hrabaňová - 19th International Steering Committee Meeting - Decade of Roma Inclusion 2005-2015 (czech)

Opening Speeches
Czech PM Petr Nečas - 19. International Steering Committee Meeting (czech)
Vladimír Galuška - 19. International Steering Committee Meeting (english)
Karel Holomek - 19th International Steering Committee Meeting - Decade of Roma Inclusion 2005-2015 (czech)
Peter Harrold - 19th International Steering Committee Meeting - Decade of Roma Inclusion (english)

Launch of the World Bank Report “Roma Inclusion: An economic opportunity for Europe“
Launch of the World Bank Report “Roma Inclusion: An economic opportunity for Europe“ (english)
Belinda Pyke (European Commission) - 19th International Steering Committee Meeting (english)
Martin Šimáček - 19. International Steering Committee Meeting (czech)
Eben Friedman (REF) - 19th International Steering Committee Meeting - Decade of Roma Inclusion (english)
Bernard Rorke (OSI) - 19th International Steering Committee Meeting - Decade of Roma Inclusion (english)

European Approach to Roma Integration – Call for non-discriminatory action “Decade – together for better integration”
Jan Jařab (UN) - 19th International Steering Committee Meeting - Decade of Roma Inclusion (english)
M. Francois Zimeray, Ambassador for Human Rights, France (ISCM) (english)
Valentine Mocanu - 19th International Steering Committee Meeting (english)
Iulian Stoian - 19th International Steering Committee Meeting (english)
Michael Kocáb - 19. International Steering Committee Meeting (czech)
Isabela Mihalache, M. François Zimeray, Jan Jařab - discussion - 19th International Steering Committee Meeting (english)

Roma inclusion is not only very important for social harmony and the successful integration of Europe, it is also economically beneficial – these are the findings of the WB research in Bulgaria, Czech Republic, Romania and Serbia. Joost de Laat summarized the results of the study into four basic messages:

  1. Roma inclusion would be beneficial to the economy as follows: Currently, Roma integration on the labor market is very low, but equal opportunities for Roma on the labor market would produce great economic benefits, and those benefits would exceed the costs of educating Roma.
  2. Roma people do want to contribute and have the potential to do so.
  3. There is a Roma integration knowledge base concerning what works in this field.
  4. The resources to fund this integration are accessible.

As de Laat emphasized, the WB findings contradict generally prevailing stereotypes. “As we know, anti-Roma prejudices and stereotypes are deeply rooted in Europe, but the outcomes of our report clearly show those prejudices do not correspond to the facts,” de Laat told news server Romea.cz. In his view, Roma people are interested in working but are employed much less frequently than are non-Roma (the term the WB used in its study). When Roma people are employed, they are paid much less than people from the majority society. Roma people also enter the labor market at a much lower age than the majority; in Bulgaria, Romania, and Serbia, the percentage of Roma youth under 15 years of age who work is three times higher than the percentage of majority-society youth.

“If Roma of productive age (16 – 64) enjoyed equal opportunity in access to employment (and to the same wages as non-Roma), all four of the countries studied would add billions of euro to their budgets annually. If this were to happen in all of the Central European countries and in the Balkans, equal opportunities on the labor market would generate a total of 10 billon euro annually. The economic and financial costs of Roma social exclusion in the Czech Republic in the year 2008 were equivalent to losses of CZK 9.7 billion in productivity and CZK 6.2 billion in direct financial costs. The study based those calculations on an estimated number of 70 000 Roma living in marginalized localities, which means it reflects the lower end of the estimated range of costs and losses. Real losses, therefore, could be as much as four times higher depending on the actual overall number of Roma. Economic losses are a result of worse employment outcomes, both because of higher unemployment and because of the lower wages paid to socially excluded Roma. Only 42 % of Roma of productive age are employed and the average net monthly income of a Roma employee in the Czech Republic is 58 % lower than the average net monthly income of a non-Roma employee. The economic potential calculated per Roma person per year could exceed 7 000 euro annually,” said de Laat.

The WB estimates economic potential according to various benefits generated, primarily labor productivity and higher tax revenues. Each of the states studied would annually gain a fiscal yield of hundreds of millions of euro for an average of around three billion through Roma integration. This would primarily flow from increased direct and indirect tax revenues (where indirect taxes include health and social insurance).

“It is sometimes expected that the reduction in welfare expenditure if Roma employment were higher might contribute to the overall economic benefit, but that aspect matters much less than is generally supposed. The notion that Roma live off of welfare is not a fact, but a prejudice which we have now succeeded in refuting. Even though a higher percentage of Roma live on welfare than do majority-society people, there are far fewer Roma on welfare than many believe. For example, in Romania only 12 % of Roma are on welfare, in Bulgaria 16 %, and in Serbia 25 %.” In the Czech Republic, the WB only researched Roma living in ghettos and was therefore unable to generate estimates for the overall number of Czech Roma welfare recipients.

As the WB representative said, it is not strange that some Roma live on welfare, because welfare exists in order to maintain social solidarity. “The welfare network is supposed to support the poorest of the poor, and there is no doubt that the Roma living in marginalized localities are represented in that population,” said de Laat.

The education gap between majority societies and the Roma minority, according to the WB, is so large there is no surprise that Roma have problems finding work. However, the study argues that the fiscal benefits alone of closing the education gap between Roma and non-Roma would far outweigh the cost. Even if it were conservatively assumed that it would cost 50 % more per Roma pupil than per non-Roma pupil to ensure that Roma children attain the same education at all levels as majority populations, the necessary investments needed to close the education gap would only cost on average approximately 30 % of the fiscal benefits generated through the resulting equal labor market opportunities for Roma across the four countries. This calculation is based on an estimate that conservatively assumes Roma would have similar primary school completion rates as the majority, but would have secondary completion rates only one-tenth those of majority populations; it also assumes Roma would not participate in either pre-school or higher education (as is generally the case today). According to this model, Bulgaria would need to invest 51.8 % of its annual fiscal gains from increased Roma employment, the Czech Republic would need to invest only 15.9 % of its annual fiscal gains, Romania would need to invest 60.4 % of its annual fiscal gains, and Serbia would need to invest 31.1 % of its annual fiscal gains into closing the education gap.

For the Czech Republic, the study summarizes the situation as follows: Only 60 % of the Roma living in socially excluded localities have achieved a primary education and many of them attended “special schools”. Only every fifth Roma person in the Czech Republic has achieved a high school or college education.

"In the year 2007, the European Court of Human Rights found that the system of counseling centers and ‘special schools’ discriminates aga nst Roma children. In some regions as many as 50 % of the children in schools teaching the curriculum for children with light mental disability are Roma, even though nationwide a maximum of only 3 % of the population suffers this type of disability. Sending Roma children onto this secondary education track condemns the vast majority of these children to the trap of social exclusion and just intensifies the entire problem,” claims Filip Rameš, coordinator of Open Society Fund Praha’s Roma program.

The World Bank is, therefore, unambiguously proposing immediate investment into Roma education as the best solution to the problem of Roma exclusion. Better-educated Roma can expect to be financially rewarded up to 110 % more than uneducated Roma and will contribute more to the state as a result.

Czech PM Petr Nečas also attended the opening of the Decade of Roma Inclusion International Steering Committee meeting. In his view, the key to integrating Roma into society is better education for Roma children and the availability of employment opportunities: “We consider an emphasis on better educational services of higher quality to be the key. Roma children and youth must primarily receive better, higher-quality, and more accessible educations.” He added that one of the Czech government’s aims is also to prepare accessible employment opportunities for all, but in order to create those opportunities the economy must prosper.

The PM went on to say that the government is aware of the “deficiencies in the co-existence of Roma and the majority society”, but that improving relations would be a long-term process in which the state can only play a limited role. “Both sides must make a contribution, the majority society and the Roma community. We must eliminate any and all mutually-held prejudices about one another. We must also proceed through realistic steps that will truly aid integration. We will be paying great attention to what you have to say here,” Nečas said to the representatives of the International Steering Committee.

After the Czech PM left the conference, he was criticized by the Ambassador for the Czech presidency of the Decade, Karel Holomek. After expressing appreciation for Nečas’s participation in opening the conference and demonstrating the government’s commitment to addressing Roma problems, Holomek criticized the Czech government’s plans for budget cuts, which will do the most harm to groups that are socially weakest. He also criticized the PM’s suppression of the human rights agenda. “This criticism is not just an impression, it is based on studying the government’s program declaration and on knowledge of the people whom the Prime Minister, with all due respect, has selected as his advisors,” Holomek said. Holomek said those advising Nečas are advocating for strength of personality and the freedom to make decisions as the best and sole means for protecting human rights. “That doesn’t work in democracies that have been up and running for some time, to say nothing of a democracy like ours, which is far from up and running,” Holomek closed his remarks.

František Kostlán, Gwendolyn Albert, František Kostlán, translated by Gwendolyn Albert
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