WASHINGTON: The IMF has pushed borrowing countries to make bigger austerity cuts over the past decade, charity Oxfam said on Thursday, urging for alternatives to such measures.
‘These cuts undermine vital spending on public services from health care to education and housing that protect low-income communities,’ Oxfam warned in a statement.
It said the median annual austerity cuts required by the International Monetary Fund rose from 0.21 percent of GDP between 2012 and 2017 to 0.85pc of GDP between 2018 and 2025.
At the same time, thefund also weakened protections to social spending in its loan programmes, Oxfam added. IMF spokesperson Julie Kozack stressed that all the fund’s programmes have ‘social spending floors’ aimed at protecting vulnerable groups. She added that the fund is also focused on how countries can raise more revenue or resources domestically to help provide essential public services.
One concern is that the IMF could ‘return to 1980s-style structural adjustment’ by demanding large public spending cuts from governments at the start of a programme, instead of phasing in reductions.-AFP