A Human Approach: Social Protection can be a Powerful Tool for Poverty Reduction

Social protection isn’t just there to help the poor — it can help citizens not become poor   
Photo- SYED ZAKIR HOSSAIN

Social security is not only a net meant to keep those who are extremely poor afloat (“provisional measures”). It is also a system meant to help citizens face the contingencies of life so that they don’t fall into the clutches of poverty (“preventative measures”).

People need support to face challenges of health, caring for babies or elderly parents, disability, floods, water-logging, and the death of earning family members without becoming impoverished. To address the complex interaction of risks throughout a life-cycle of a citizen, a well-designed, overarching social protection system is necessary.

Additionally, a comprehensive social security system also encompasses programs that empower people to join the mainstream economy and climb out of poverty (“promotional measures”) and programs that address policies that affect the poorest (“transformational measures”).

With this in mind, the government has formulated a National Social Security that calls for a consolidated life-cycle approach to protection. The finance division of the Ministry of Finance has undertaken a project to align with this vision and to strengthen the social protection system through efficiency and effectiveness in the use of resources and budget.

As such, a new executive director (joint secretary) and project director were appointed this month in the Ministry of Finance to run the social protection budget management unit. This unit will try to ensure that expenditures and allocation decisions are made in a value-for-money way to support the most appropriate programs.

Various donors are helping this unit develop capacity, run diagnostic studies, and research to build an evidence base for reforms and develop an MIS connected eventually to all line ministries with social protection programs. The driving force of reform will be value for money.

Challenges that need to be overcome include low levels of coverage of key schemes as a result of small budgetary allocations, fragmentation of spending into many different small schemes, small transfer values, limiting the impact on household multi-dimensional poverty, poor targetting, lack of beneficiary databases for individual programs, administrative inefficiency in many fragmented programs, and lack of efficient payment mechanisms, delays, lack of electronic transfer/mobile, inaccurate payments, payments in-kind. Entrenched interests pose an additional threat that needs to be overcome.

The reform aims to increase impact in terms of improved targetting, lower leakages, increased access to services, improved productivity, evidence-based planning of policy and budget, efficiency in delivery systems, and the establishment of an efficient impact and expenditure monitoring system.

In order to achieve these aims, high quality data to promote evidence-based dialogue is needed. The government staff needs to be empowered with better tools for data capture with greater capacity to address problems. The high turnover of government staff needs to be reduced or training needs to be modularised so new people can quickly be brought up to par.

Incentives need to be in place for government staff to improve their efficiency and effectiveness. And the supply of other essential public services, especially health and education, needs to be adequate in terms of coverage and quality.

Social protection is a powerful tool for poverty reduction that brings about some redistribution of wealth and social justice. For our social security system to be truly transformative in its impact, it needs to be grounded in an understanding of the multi-dimensional nature of extreme poverty.

Assessing poverty in terms of the proxies of income may be helpful but these proxies do not capture the diverse manifestations of poverty, nor the interplay of socio-economic and political processes that generate vulnerability. A human development approach is necessary, one which builds on the work of Amartya Sen and promotes an understanding of poverty that is “human-centred,” not economy-centred.

Addressing structural vulnerabilities (together with other forms) requires a political approach to social protection, focusing on rights, duties, democracy, and advocacy.  The NSSS is a step in the right direction.

By: Shazia Omar

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