Unpacking the PIP box

What is the governance environment in which livelihoods are constructed? What are the key issues identified by the Policy, Institutions and Processes (PIP) sub-group on institutional issues? The author of this paper synthesises information from seven recent PIP papers that attempt to unpack some of the current thinking - theoretical and practical - on how to approach institutional policy issues. The paper also draws on other work relevant to understanding the PIPs, including two papers commissioned for an FAO forum on sustainable livelihoods (SL) approaches. In drawing together elements of the PIP jigsaw the author raises the issue of whether all the 'pieces' are present and whether the 'big picture' is visible.

While attempting to link the various central themes including governance, decentralisation and institutional change, the paper embraces the complex range of issues encompassed by SL approaches view of policies, institutions and processes, such as participation, power and social relations and finds:

• a general set of issues emerges but no recipes for success. It appears that although elements of the analyses discussed can be used to gain an understanding of the institutional context and some of the questions to be asked, the tools and practices to implement these approaches still need to be systematically documented
• PIPs are important because they determine the degree to which an enabling or facilitating environment for livelihoods is in place, compared to an inhibiting and blocking one
• organisational change of government departments has been one of the main mechanisms used to develop structures in which poor people can get better access to services. Without change in the wider institutional environment however, organisational change alone is often insufficient and may founder due to blockages outside the control of the organisation
• New Institutional Economics (NIE) provides an analytical framework for examining the importance and effects of the policies, institutions and processes that make up the formal and informal institutional environment, at different scales of analysis and action (from international and national institutions, to those such as gender relations, operating within communities and households)
• if the 'big picture' of the PIP jigsaw is provided by the governance environment (broadly defined), then there are still some significant pieces missing. These include the role of political capital, understanding informal institutions and clarifying the roles and relationships of the state and private sector.

The author concludes that there are missing pieces to be found before the PIP jigsaw offers a true picture. As a consequence:

• there is a necessity to further investigate the linkages between governance and social issues and how they impact on livelihoods. This is a critical area of understanding that is currently weakly developed
• there is an equal need to encourage and empower citizens or users of services to exert legitimate pressure and demands on state delivery machinery, as much as there is a need to develop responsive public and private sector organisations
• there is a need to fill the gap in PIP thinking regarding the place of the market. Similarly crucial is the need to deal with the absence of discussion on the role of the private sector and the form of relationships necessary to ensure effective support to the development of sustainable livelihoods
• tools are needed that can both identify enabling or blocking 'rules of the game' and facilitate change in them if necessary.