Overview of social Laura protection Rawlings, World Bank Pensions Core Course April 2015 1 Outline 2 • What is social protection? • Types and functions of social protection • Social protection today • Common questions and concerns • World Bank and Social Protection Outline 3 • What is social protection? • Types and functions of social protection • Social protection today • Common questions and concerns • World Bank and Social Protection What is social protection? 2 x Number of 1.2bn elderly People in extreme (over 60) poverty below in 2050 $1.25/day Social protection is (compared to 2010) about how we take care of ourselves and each other to 75 m. manage risk 674 Unemployed Average number of youth natural disasters Which definition best fits your understanding of social protection? A. “The set of public measures that a society provides for its members to protect them against economic and social distress that would be caused by the absence or a substantial reduction of income from work as a result of various contingencies (sickness, maternity, employment injury, unemployment, invalidity, old age, and death of the breadwinner); the provision of health care; and, the provision of benefits for families with children.” B. “A set of public actions which address not only income poverty and economic shocks, but also social vulnerability, thus taking into account the inter-relationship between exclusion and poverty.” C. “Social protection and labor market regulation that reduce the risk of becoming poor, assist those who are poor to better manage further risks, and ensure a minimal level of welfare to all people.” D. “Public actions – carried out by the state or privately – that: a) enable people to deal more effectively with risk and their vulnerability to crises and changes in circumstances (such as unemployment or old age); and b) help tackle extreme and chronic poverty.” 5 Which definition best fits your understanding of social protection? A. “The set of public measures that a society provides for its 38% members to protect them against economic and social 31% distress …” B. “A set of public actions which 23% address not only income poverty and economic shocks, but also social vulnerability …” C. “Social protection and labor 8% market regulation that reduce the risk of becoming poor …” D. “Public actions – carried out A. B. C. D. by6 the state or privately …” World Bank definition: Social protection and labor policies let countries help their people achieve: Resilience Opportunity for the vulnerable for all Promoting human capital and access to productive Insuring against work impacts of different shocks Equity for the poor Protecting against dire poverty and loss of human capital 7 Outline 8 • What is social protection? • Types and functions of social protection • Social protection today • Common questions and concerns • World Bank and Social Protection Core social protection CONCEPTS Rights and Access to Basic dignity Services Social Social Insurance: Assistance: RISK POOLING TRANSFERS Labor Labor Market Market regulations Programs Core social protection INSTRUMENTS Social Social Labor Insurance Assistance Cash Transfers Old Age Pensions (conditional, public works, unconditional) Active Labor Market Disability Programs In-kind Transfers (school Unemployment feeding, fertilizer, seeds) Maternity Fee waivers, tax incentives Health Regulations Subsidies Informal savings pooling Universe of social protection programs Social protection over the lifecycle Pregnancy/ Work Child- Old early Youth -ing hood age childhood age Employm- Nutrition/ Youth ent ECD, CCTs CCTs for employ- Opportunity/ services, Productive for pre- (girls’) ment entrepre- aging Promotion school, education programs, neurship, health skills skills Cash & in- OVC Child kind Equity/ programs, allowances Public Social transfers, child school works pensions Protection public allowances feeding works Unemploy- Old-age Micro Resilience/ Maternity School ment, pensions, insurance allowances feeding disability disability Prevention schemes insurance insurance 12 CLICKER QUESTION At what stage of the lifecycle are needs concentrated in your country? A. Early childhood B. Childhood C. Youth D. Working age E. Old age 13 At what stage of the lifecycle are needs concentrated in your country? A. Early Childhood 43% B. Childhood C. Youth 30% D. Working age E. Old age 10% 10% 7% 14 A. B. C. D. E. Outline 15 • What is social protection? • Types and functions of social protection • Social protection today • Common questions and concerns • World Bank and Social Protection The revolution is happening where 17 needs are greatest Rapidly 2000 2010 2012 9 countries, 35 countries 41 countries, 25 programs* 123 programs 245 programs * Counts CTs with clear start dates only; green countries have had or currently have a CT Types of social protection across countries Social Pensions Other Labor Targeted Assistance Insurance Programs service delivery Employment Support Middle National, proxy- Expand multi- services; job marginalized income means tested pillar pension Expand formal search groups to access system countries social transfer disability & assistance; quality services systems accident labor regulation insurance Reform contributory Low Index-based Skills Targeted support schemes; agricultural income Regular seasonal development, to increase Promote savings insurance; countries public works; especially for access to quality cash transfers to for informal Targeted support informal sector services for the select groups sector to extend health poor insurance poor Cash & In-kind Social pensions Temporary job Rebuilding basic through Community- (pubic works), infrastructure Fragile safety nets through NGOs or community- Based Health demobilization & and services states community- based initiatives Insurance reintegration based organizations 18 Social protection contributes to gender equality, opportunities and better access to services Access to Gender equality Nutrition education/ health Transfers and school Transfers/public work for feeding helps meet Increased resources for poor women empowers implicit and opportunity poor families reduce them and improves costs of education, hunger and malnutrition capabilities boosting enrollment and attendance Programs provide Improved nutrition in first improved access to 1000 days of life have Transfers during shocks education for huge impact on future preserve human capital girls/maternal care for incomes/productivity women Evidence shows that social protection and labor policies contribute to sustainable, inclusive growth National level - Promotes social cohesion, enables reform - Stimulates aggregate demand Community level - Creates productive assets - Improves functioning of labor markets - Creates local spillovers from increased demand Household level - Fosters accumulation of assets - Increases entrepreneurial activity - Increases/preserves human capital Source: Alderman and Yemtsov (2012) Outline 21 • What is social protection? • Types and functions of social protection • Social protection today • Common questions and concerns • World Bank and Social Protection “For Protection and Promotion” book on Social Assistance addresses: • Affordability • Administrative feasibility • Various disincentives 0 1 2 3 4 5 6 7 Affordability: How much is spent on social safety safety on social is spent How much Affordability: % of GDP % of BENIN Average ZAMBIA 1.6 GHANA CAMEROON TANZANIA % NIGER MALI TOGO KENYA Sub BURKINA FASO GAMBIA, THE Africa - AFR RWANDA Saharan Saharan MADAGASCAR MAURITANIA LIBERIA MOZAMBIQUE SWAZILAND ERITREA NAMIBIA BOTSWANA SEYCHELLES SOUTH AFRICA SIERRA LEONE MAURITIUS LESOTHO PAPUA NEW GUINEA SOLOMON ISLANDS VANUATU MALAYSIA LAO, PDR PHILIPPINES East Asia & Asia East VIETNAM Pacific SAMOA EAP CHINA CAMBODIA THAILAND INDONESIA FIJI MARSHALL ISLANDS PALAU MONGOLIA KIRIBATI TIMOR-LESTE TAJIKISTAN LATVIA AZERBAIJAN nets? KAZAKHSTAN BULGARIA MACEDONIA, FYR BELARUS TURKEY Eastern Europe & & Europe Eastern ARMENIA MONTENEGRO Central Asia Central KOSOVO ALBANIA ECA POLAND SERBIA LITHUANIA SLOVAKIA MOLDOVA UKRAINE ESTONIA SLOVENIA RUSSIA BOSNIA & HERZ. ROMANIA KYRGYZ REP. HUNGARY CROATIA GEORGIA PERU HONDURAS MEXICO COLOMBIA Latin America & & America Latin Latin America & & America Latin EL SALVADOR Caribbean URUGUAY Caribbean ST. LUCIA LAC ST. KITTS AND NEV. ECUADOR JAMAICA ARGENTINA CHILE ST. VINCENT BRAZIL PANAMA BELIZE NICARAGUA EGYPT Middle TUNISIA North Africa North WEST BANK & GAZA KUWAIT MENA MOROCCO - East & & East SAUDI ARABIA LEBANON SYRIA JORDAN IRAQ YEMEN, REP. BAHRAIN AFGHANISTAN INDIA South South Asia BANGLADESH SA BHUTAN PAKISTAN NEPAL MALDIVES SRI LANKA CLICKER QUESTION What is the mean cost of safety nets in developing countries? A. O.1% GDP B. 1.6% GDP C. 3% GDP D. 7% GDP E. 12% GDP 24 What is the mean cost of safety nets in developing countries? 58% A. O.1% GDP B. 1.6% GDP C. 3% GDP D. 7% GDP E. 12% GDP 19% 13% 6% 3% A. B. C. D. E. 25 For Protection and Promotion benchmarks Social Assistance programs on Program generosity: … is lower in developing than developed countries, with median program adding 10% to 20% to pre- transfer consumption of their beneficiaries For Protection and Promotion benchmarks Social Assistance programs on Administrative costs … are moderate and in line with their OECD counterparts even for finely targeted means- or proxy-means tested programs Index of admin cost = generosity * share of admin cost in program budget But there are remaining challenges…. • Social Insurance (SI) coverage is low