Social Protection at a Crossroad—and Poverty On the Rise

Credit: Frank Dejongh / UNICEF
  • Opinion by Annalena Oppel (helsinki)
  • Inter Press Service

I recently had the opportunity to participate as a lead discussant at the UN DESA expert group meeting with many distinguished speakers sharing their insights on achieving the Sustainable Development Goals (SDGs) in 2030 despite the COVID-19 pandemic.

One of sessions discussed future pathways for social protection. Discussants evaluated a set of policies that are gaining significant interest as a tool for recovery but also in building more resilient, adaptive, and inclusive social protection systems going forward.

The COVID-19 pandemic has led to an increased number of social protection measures to help people cope with economic challenges. A total of 4,648 policy measures that addressed the economic and health challenges of the pandemic were identified worldwide.

Most of them fall into the field of social assistance (for example cash or in-kind transfers), with 955 policies receiving fiscal support from a government (UNESCWA, 2021).

However, many of these programmes are temporary, and it is not yet evident whether they will remain an integral part of social protection in the long run.

Many of the challenges that have gained greater visibility during the pandemic have existed long before the pandemic started. As evidenced by the Sustainable Development Goals, the international community and policy makers were still in the pursuit of ending poverty and hunger, and establishing good health and well-being.

Yet as many as 115 million people might be pushed into extreme poverty by the end of 2021 — a major setback in the progress already made. Hence, challenges that continued to exist before can worsen if they remain unaddressed.

Social protection can constitute a tool to address multiple challenges, including poverty, food insecurity or inequalities.

A major concern or point of debate is fiscal space or fiscal prioritization. In other words, to what extent can countries afford and sustain social protection programmes.

This is an ongoing debate, with parties providing various funding solutions, but the most sustainable is often considered to be that of domestic revenues. An initiative in 2015 showed that countries do not need to invest an unreasonable amount in order to implement Social Protection Floors – a framework that captures basic provisions in the area of income and health. In 103 countries, the required resources would amount to less than 5 percent of GDP.

There are then only 12 countries which would require international assistance to implement Social Protection Floors as required resources exceed 10 percent of GDP.

Already in 2012 – the same year that ILO proposed the Social Protection Floor (Recommendation 202), two UN experts proposed a Global Fund for Social Protection (GFSP) for Least Developed Countries (LDCs) to ensure financial feasibility and enable countries to put ambitious social protection schemes into place.

In light of COVID-19, there is a growing momentum to revisit this proposal (for example, see here and here).

Another important aspect that was discussed during the expert forum is the availability of data. Data enables evidence-based policy making or to assess the design and feasibility of social policies.

Regarding fiscal capacity, the Government Revenue Dataset (with a newly released version in August 2021) can provide a valuable source on domestic revenues. It covers tax and revenue collection in 196 countries since the 1980s and can provide some insights into how previous crises may have affected fiscal space.

Band-aids or pathways to sustainable development?

Overall, the GFSP and current discussions provide examples of opportunities to propel social protection forward in order to address poverty and inequality.

Ongoing debates, political will, fiscal space, and prioritization will show whether we are on a pathway towards more adaptive, inclusive, and sustained social protection systems, or whether the current expansion of programmes remain short-lived initiatives.

As we move forward, research can support this process by providing timely insights and advice on the effectiveness of current programmes in addressing persistent challenges, e.g., poverty, hunger, and inequality.

At UNU-WIDER, the GRD project, as part of the Domestic Revenue Mobilization programme, is working on different aspects of revenue collection, which can support developing countries to make social protection a lasting solution towards sustainable development.

It is also important to gain a better understanding of the current political climate to see whether public support is aligned with a global mission of building back better, within which social protection can play a crucial role.

*The UN University- World Institute for Development Economics Research (UNU-WIDER) provides economic analysis and policy advice with the aim of promoting sustainable and equitable development for all. The institute began operations over 30 years ago in Helsinki, Finland, as the first research centre of the United Nations University.

The writer is a Research Associate at UNU-WIDER* working on the World Income Inequality Database and the Government Revenue Dataset. She obtained her PhD from the Institute of Development Studies, University of Sussex, UK.

The views expressed in this piece are those of the author, and do not necessarily reflect the views of the Institute or the United Nations University, nor the programme/project donors.

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© Inter Press Service (2021) — All Rights ReservedOriginal source: Inter Press Service