GFC Paper
GFC Paper
In the face of poor economic growth and rising public deficit austerity measures are
increasingly being adopted by states to try and stabilise the financial situation 1. In
this regard the ongoing Global Financial Crisis (GFC) has put an increasing strain on
this already tentative relationship between economic globalisation and human
rights. In an open letter to member states on the 16 May 2012, Ariranga G. Pillay,
Chairperson of the Committee on Economic, Social and Cultural Rights, highlights
that although difficult decisions have to be made at times of austerity measures,
these decisions should never come at the expense of international human right
treaty obligations2.
This paper will examine how far a state can go in times of financial crisis when it
comes to austerity measures that affect human rights. Here two distinct
perspectives can clearly be identified. The national perspective, that the state has
the right to deal with GFC how it sees fit and the international perspective that says
internationally respected human rights norms place limits on what states can do.
Here human rights legislation can be seen as setting the boundaries through the
various declarations and treaties states are obligated to.
‘States choose to subscribe to the neo-liberal ideology that underpins the current,
hegemonic form of economic globalization. The aim of the neo-liberal approach is
to secure the free flow of goods and services, to liberalise foreign direct investment,
to remove capital controls, and to allow labour to move where it is most
productive.’3
This creates a less restricted global market and encourages international trade. A
Statement by the Committee on Economic, Social and Cultural Rights from May 1998
[1998 Statement] also describes this dilution of state responsibility by increased free
market trade agreements.
“a variety of specific trends and policies including an increasing reliance upon the
free market, a significant growth in the influence of international financial markets
and institutions in determining the viability of national policy priorities, a diminution
in the role of the state and the size of its budget, the privatization of various
functions previously considered to be the exclusive domain of the state, the
deregulation of a range of activities with a view to facilitating investment and
rewarding individual initiative, and a corresponding increase in the role and even
responsibilities attributed to private actors, both in the corporate sector, in
particular to the transnational corporations, and in civil society,” 4
3
Benedek, Wolfgang, De Feyter, Koen, and Marrella, Fabrizio (2007), Economic Globalisation and
Human Rights, Cambridge University Press, p4
4
Statement by the Committee on Economic, Social and Cultural Rights, May 1998, COMMITTEE ON
ECONOMIC, SOCIAL AND CULTURAL RIGHTS, 18th session, 27 April-15 May 1998, Geneva, para 2
2
If states can decide to lessen their control of sovereignty in order to strengthen
economic ties, why then should they still be held responsible to human rights
agreements? How can the state be held responsible for maintaining human rights
standards if they have diminished their sovereign responsibilities by engaging
private companies and other third party international organisations. Can these third
parties be made to respect human rights standards? Furthermore, in reacting to the
GFC can states employ temporary measures that may be against human rights
treaties in order to protect the economy long term?
One example of this criticism is found in the 1998 statement from the UN committee
on Economic, Social and Cultural Rights. This made it clear that there is a link
between pressure on states to globalise economically and the respect they have for
economic, social and cultural rights and in particular labour rights 8. However, the
statement also emphasizes that a states desire for economic prosperity cannot come
before its commitment to human rights treaties. It states explicitly that:
5
The Economic and Social Council report entitled ‘The Realization of Economic, Social and Cultural
Rights: Globalization and its impact on the full enjoyment of human rights’ (E/CN.4/Sub.2/2000/13)
published in June 2000, provides an extensive list of rights enshrined in covenants that are potentially
violated by the negative impact of economic globalization., available at
http://www.unhchr.ch/huridocda/huridoca.nsf/%28Symbol%29/E.CN.4.Sub.2.2000.13.En?O
pendocument (accessed: 23/09/2012),
6
E/CN.4/Sub.2/2000/13, (15 June 2000), Ibid. Para 41
7
Feyter, (2007), Ibid. p4
8
Point three of the general statement highlights: “…globalization risks downgrading the central place
accorded to human rights by the United Nations Charter in general and the International Bill of
Human Rights in particular. This is especially the case in relation to economic, social and cultural
rights.’ [1998 Statement, Ibid]
3
“Competitiveness, efficiency and economic rationalism must not be permitted to
become the primary or exclusive criteria against which governmental and inter-
governmental policies are evaluated.”9
And furthermore, that trade agreements even if they remove certain powers from
the state to international organisations do not remove the states human rights
obligations. As it describes:
‘It is particularly important to emphasize that the realms of trade, finance and
investment are in no way exempt from these general principles and that the
international organizations with specific responsibilities in those areas should play a
positive and constructive role in relation to human rights.’ 10
4
on Civil and Political Rights (ICCPR)14. These instruments have been ratified by a
substantial number of states thus creating a legitimate global acceptance of the
general principles of human rights and binds states to legal obligations. 15
“…when treaties in the economic sphere are interpreted and applied, one should be
conscious of the central position accorded to human rights in the international
system. The existence of treaty and customary human rights obligations for states …
must therefore be borne in mind in construing economic treaties between states or
agreements between state and non state actor.”18
18
Human rights in economic globalization – Adam McBeth p139 -167, from Joseph, Sarah and
Mcbeth, Adam, Research Handbook on International Human Rights Law (2010), Edward Elgaar press:,
p143
19
E/CN.4/Sub.2/2000/13, (15 June 2000), Ibid. para 45
5
The obligations of these international treaties can therefore be seen to put
limitations on how states can react to the GFC as measures cannot be taken that
adversely affect human rights.
This provision means states cannot ignore economically inconvenient rights at times
of financial crisis. They must always protect all the human rights they are obligated
20
Ssenyonjo, Manisuli (2010), ‘Economic, social and cultural rights: an examination of state
obligations’ pp36 – 71, Joseph, Sarah and McBeth, Adam (2010), ‘Research Handbook on
International Human Rights Law, Edward Elgar, p40:
‘Preamble [4] IVESCR recognises that, ‘in accordance with the Universal Declaration of Human Rights,
the ideal of free human beings enjoying freedom from fear and want can only be achieved if
conditions are created whereby everyone may enjoy his economic, social and cultural rights, as well
as his civil and political rights’
21
The Vienna Declaration and Programme of Action (1993), A/CONF.157/23, available at :
http://www.unhchr.ch/huridocda/huridoca.nsf/%28symbol%29/a.conf.157.23.en {last accessed 1
October 2012)
22
Globalization and its impact on the full enjoyment of human rights, (2000) E/CN.4/Sub.2/2000/13,
Ibid.
6
to.
Article 2
1. 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.
23
Ssenyonjo, (2010) Ibid. P41
24
UN Commission on Human Rights, Note verbale dated 86/12/05 from the Permanent Mission of
the Netherlands to the United Nations Office at Geneva addressed to the Centre for Human Rights
("Limburg Principles"), 8 January 1987, E/CN.4/1987/17, available at:
http://www.unhcr.org/refworld/docid/48abd5790.html [accessed 1 October 2012]
25
International Commission of Jurists (ICJ), Maastricht Guidelines on Violations of Economic, Social
and Cultural Rights, 26 January 1997, available at:
http://www.unhcr.org/refworld/docid/48abd5730.html [accessed 1 October 2012]
26
Ssenyonjo, (2010) Ibid. p41
7
The Maastrict Guidelines propose the “respect, protect, fulfill” model.
This implies that the state has an obligation to:
27
UN Office of the High Commissioner for Human Rights, Fact Sheet No. 33, Frequently Asked
Questions on Economic, Social and Cultural Rights, December 2008, No. 33, available at:
http://www.unhcr.org/refworld/docid/499176e62.html [accessed 1 October 2012]
28
Ssenyonjo, (2010) Ibid. P44
29
Ssenyonjo, (2010) Ibid. p49
8
has been made. Furthermore, it must always implement programmes targeted at
the most vulnerable groups in society, so that a minimum core obligations are met. 30
States are also obligated to non-retrogressive measures meaning they cannot
implement polices that can be seen to have a negative impact on existing human
rights standards unless they have a strong justification for doing so.31 Here you could
argue that at time of GFC there is indeed this strong justification and some
retrogressive measures could legitimately be implemented. This is an argument that
we will examine in more depth later when we examine recommendations suggested
by the CESCR in the open letter of May 2012 in response to the GFC.
2.3: The Role of the Committee on Economic, Social and Cultural Rights
(CESCR)
The Committee on Economic, Social and Cultural Rights (CESCR) was established by
the United Nations Economic and Social Council (ECOSOC) in resolution 1985/17 32 to
oversee the implementation of the ICESCR. The CESCR can also be viewed as
clarifying states obligations in this area with the issuing of General Comments and
statements33. These documents are not legally binding but can be seen as having a
persuasive effect and are authorative guidelines34. For example General Comment 3
(of the CESCR) describes that: “even in times of severe resource constraints whether
caused by a process of adjustment, of economic recession, or by other factors the
vulnerable members of society can and indeed must be protected by the adoption of
relatively low-cost targeted programmes.”35
Upon acceptance of the Covenant of the CESCR, states must initially report within
two years and following this every five years to the committee who review these
reports and provide recommendations over each states activities. These ‘Concluding
30
Fact Sheet No. 33, (2008), No. 33, p16
31
Fact Sheet No. 33, (2008), No. 33, p16
32
Chapman, Audrey R., Carbonetti, Benjamin (2011), Rights Protections for Vulnerable and
Disadvantaged Groups: The Contributions of the UN Committee on Economic, Social and Cultural
Rights, Human Rights Quarterly, Volume 33, Number 3, August 2011, pp. 682-732, The Johns Hopkins
University Press
33
Ssenyonjo, (2010) Ibid. p42
34
Ssenyonjo, (2010) Ibid. p42
35
Chapman, Audrey R., Carbonetti, Benjamin (2011), p695
9
Observations’ (COs) provide a good example of how the committee views the states
obligations towards human right commitment. For example the CO of Argentina in
1999 where the government had been struggling to stabilize the economy and the
committee criticized them for the knock on effects to human rights standards 36 : The
Committee notes, “While the Government has succeeded in stabilizing the value of
the currency, the implementation of the structural adjustment programme has
hampered the enjoyment of economic, social and cultural rights, in particular by the
disadvantaged groups in society.”37
‘Legislative measures include not only the adoption of new legislation but also the
duty to reform, amend and repeal legislation manifestly inconsistent with the
Covenant.’39
36
Chapman, Audrey R., Carbonetti, Benjamin (2011), p702
37
Concluding Observations of the Committee on Economic, Social and Cultural Rights : Argentina.
12/08/1999, E/C.12/1/Add.38, [para 10]
38
Ssenyonjo, (2010) Ibid. p42
39
Ssenyonjo, (2010) Ibid. p42
40
CESCR, Concluing Observations: Cyprus, /C.12/1/Add.28 (4 december 1998) [para 26]
10
this conflict. These remedies may help alleviate pressure on the state without
negating their human rights responsibilities.
41
Feyter, (2007), Ibid. p8
42
Feyter, gives the following example of this: ’The WTO Doha Declaration on TRIPS and public
health… could perhaps serve as an example of a WTO effort to interpret the TRIPS Agreement in such
a way that it does not conflict with the obligations of WTO member states under international human
rights law’. (Feyter, (2007), Ibid. p8)
43
E/CN.4/Sub.2/2000/13, (15 June 2000), Ibid.
44
E/CN.4/Sub.2/2000/13, (15 June 2000), Ibid. Para 47
11
inevitable.45
This suggests that the committee recognizes there is some degree of flexibility when
it comes to states international obligations and the application of austerity measures
to try and stabilize the economy. However, the Committee outlines a list of
recommendations that states should adhere to when adjustments are being made
to Covenant rights. These being:
1. The policy must be a temporary measure
2. The policy is proportionate and necessary
3. The policy is not discriminatory
4. The policy recognizes the ‘minimum core content of rights’ 46
CONCLUSION
In conclusion the GFC can be seen has negatively impacting the on the realization of
human rights, particularly economic, social and cultural rights. Despite the nature of
economic globalisation removing certain responsibilities from the state it does not
remove its obligations to international human rights treaties.
These treaties can be seen as setting boundaries in several ways. For example,
through the indivisibility of rights, by states obligation to protect, respect and fulfil
treaty obligations and by the monitoring and reporting role of the CESCR. However,
the Committee on Economic, Social and Cultural Rights recognises that at times
austerity measures may be necessary that do indeed impact on treaty
45
The letter states:
“Economic and financial crises, and a lack of growth, impede the progressive realization of economic,
social and cultural rights and can lead to retrogression in the enjoyment of those rights. The
Committee realizes that some adjustments in the implementation of some of these Covenant rights
are at times inevitable’
12
responsibilities. These can at times be acceptable providing they meet certain
requirements including it being a temporary measure, proportionate and necessary
in that if the action was not taken the situation would become much worse and
more human rights violations would occur. Even if this compromise is allowed
states must always meet a minimum core content of rights and this where the
ultimate boundary on the matter is achieved.
13
Bibliography
Academic sources:
Benedek, Wolfgang, De Feyter, Koen, and Marrella, Fabrizio (2007),
Economic Globalisation and Human Rights, Cambridge University Press
UN Documents:
14
The Economic and Social Council report entitled ‘The Realization of
Economic, Social and Cultural Rights: Globalization and its impact on the full
enjoyment of human rights’ (E/CN.4/Sub.2/2000/13) published in June 2000,
provides an extensive list of rights enshrined in covenants that are
potentially violated by the negative impact of economic globalization,
available at http://www.unhchr.ch/huridocda/huridoca.nsf/%28Symbol
%29/E.CN.4.Sub.2.2000.13.En?Opendocument (accessed: 23/09/2012)
International Covenant on Civil and Political Rights, Adopted and opened for
signature, ratification and accession by General Assembly resolution 2200A
(XXI) of 16 December 1966, entry into force 23 March 1976, in accordance
with Article 49, Available at:http://www2.ohchr.org/english/law/ccpr.htm
[accessed 1 October 2012]
15
http://www.unhcr.org/refworld/docid/48abd5790.html [accessed 1 October
2012]
UN Office of the High Commissioner for Human Rights, Fact Sheet No. 33,
Frequently Asked Questions on Economic, Social and Cultural Rights,
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2012]
16