World Bank lead economist for South Africa Sandeep Mahajan and poverty reduction and economic management network lead economist Ambar Narayan
The finding emerged though the application of the bank’s Human Opportunity Index (HOI) methodology, which uses public domain statistics to measure inequality of opportunity in a society.
Poverty reduction and economic management network lead economist Ambar Narayan, who presented the findings in Johannesburg on Tuesday as part of the release of the bank’s biannual ‘South Africa Economic Update’, said the prevailing disparities in opportunity between a child living in a suburb as opposed to those in an urban township, or a rural village, were “huge”.
This spatial factor was a key determinant of the level of access a child had to basic infrastructure such as water, sanitation and electricity.
The second most important factor in the prevailing inequalities of opportunity related to the education of the head of the household, which typically determined the level of access to quality education and health insurance.
The report found that racial factors remained dominant, but that these diminished “once you take into account all the other circumstances”, such as parental education, location and the composition of a household. Nevertheless, the disparity among race groups in South Africa remained large.
The HOI analysis also showed that, while the coverage rate in the provision of services was important to encouraging more equality of opportunity, high coverage rates could also conceal variation in the quality of such services.
For instance, South Africa had near universal coverage in primary education, with school attendance being close to 100% and among the best among comparator countries.
However, the poor quality of education could be seen in the fact that only around 50% of those learners completed their primary schooling on time, which was similar to rates achieved in far poorer countries such as Nicaragua, El Salvador and Honduras.
The bank acknowledged that the country had improved from a low base, but Narayan noted that South Africa’s rate of progress between 2002 and 2010 had been “distinctly lower than the majority of Latin American countries and comparable with other sub-Saharan countries”.
On the yearly average rates of HOI-measured improvement in finishing primary school on time and access to safe water and improved sanitation, South Africa ranks sixteenth, fourteenth and eleventh, respectively, out of 23 countries. However, the country had outperformed in the area of electrification.
Similarly, in the labour market, inequality of opportunity in employment is high, while the situation was particularly challenging for young workers, as well as residents of townships, informal settlements and rural areas.
“An equitable society would not allow circumstances over which the individual has no control to influence her or his basic opportunities after birth. Whether a person is born a boy or a girl, black or white, in a township or leafy suburb, to an educated and well-off parent or otherwise should not be relevant to reaching his or her full potential,” the report notes.
But it also states that for an unequal society, such as South Africa, there were “no simple, elegant policy solutions in the quest for equity”.