Social Protection: Addressing Risk or Certainty?  

Recent developments and current challenges to the extension of donor

supported social protection in developing countries

Thursday 21st November 2013

European Commission

Dr Anna McCord

Research Associate, ODI

Honorary Research Fellow, University of Manchester

Research Affiliate, SALDRU, University of Cape Town

Structure of Presentation

1. Definitions

2. Historical development of social protection

3. Social protection in developing countries

4. Key players

5. Recent developments

6. Challenges

7. Opportunities

8. Conclusion

Definitions• Social policy is ‘the public pursuit of secure welfare’ (Gough et

al, 2004)• Social protection provides benefits, (in cash or in kind), to secure

protection, inter alia, from:• lack of work-related income (or insufficient income) caused

by sickness, disability, maternity, employment injury, unemployment, old age, or death of a family member

• lack of access or unaffordable access to health care:• insufficient family support, particularly for children and adult

dependants:• general poverty and social exclusion.

•  Social security schemes can be contributory or non-contributory- social insurance or social assistance

Two Forms of Social Protection

• Universalist Social Protection• Welfare state aims to cover entire population with adequate benefits , claimable

entitlements. • Potentially includes means testing, pragmatism in response to fiscal realities• Universal Declaration of Human Rights (UDHR), the provision of a Guaranteed

Minimum Income (GMI)• Current embodiment is the Social Protection Floor (SPF) ILO Recommendation

202.• Residual Social Protection• The welfare state caters essentially to the working class and the poor. • Private insurance and occupational fringe benefits cater to the middle classes

(dualism)• Risk extension resisted by non- beneficiaries• Services for the poor are poor quality services (Tizard, 1975)

Historical development of social protection

• Democracy, demography and economic growth• Pre WW2 UK, Sweden and Germany• Russian revolution and WW1 • ILO 1919• Depression and WW2• UN charters, rights, welfare state development• Universal Declaration of Human Rights (UDHR) of 1948,

International Covenant on Economic and Social and Cultural Rights (ICESCR), (66) and the Convention on the Rights of the Child (CRC) of 1989

• ILO Social Security Convention (no 102) of 1952

Social Protection in Europe

• Social Contract• European welfare model – core is guaranteed minimum

income• Golden age to early 80s• Breakdown of model 80s – fiscal and ideological change in

social contract• Privatisation of provision and dualism – residual model• Increased ‚active‘ social protetion – enhance work (Lisbon

European Council of 2000)

Current provision of Social Protection

• International instruments provide legal and normative basis or provision for more than six decades

• Estimated 80% of the global population has no access to any formal social security protection (Felice, 2010)

• Coverage is particularly low in developing countries, particularly in low income countries (LIC)

• Varies by region - 40% in ECA and 1% in sub-Saharan Africa (World Bank, 2013) • In developed countries, mainly in Europe, provision is based on assumption that

social contract requires state to ensure income floor (GMI) • No such assumption guides policy in most developing countries • Result: • 50% of children living in poverty, • 60% of the elderly receiving no form of pension, and • 30% of the world’s population having no access to essential health care

(Cichon, 2013)

Social protection in developing countries

• Mix mostly cash transfers and public works• Embryonic post colonial provision – for elites• Diversity• Regional, income level play major role, plus level of policy

autonomy• LAC at one end of spectrum, SSA at other• Notable examples – Brazil, South Africa, China, India –

innovation and endogenous• Also sig developments Bangladesh, Ethiopia, and Nepal

Key players

• Historically global social welfare ministry – ILO (mandate, social security provision – 1952)

• Since 80s increased engagement by World Bank, initially – dominant – est. concessional resources 70% conditional (2007)

• Aim to become ‘knowledge’ bank & RSR• UNICEF - counterpoint• UNRISD, UNDESA• WFP & FAO interested in increased scope of SP• INGOs• Knowledge actors Supra-national policy making, reduction in national policy space

Summary of contestation

• “… ideas about desirable national social policy carried and argued for by the international organisations surveyed …. reveals something approaching a ‘war of position’ between those agencies and actors within them who have argued for a more selective, residual role for the state for the state with a larger role for private actors in health, social protection and education provision and those who took the opposite view. This division of opinion often reflected a disagreement as to whether the reduction of poverty was a matter of targeting specific resources on the most poor, or whether it was a matter of major social and political-institutional change involving a shift in power relations and a significant increase in redistribution from rich to poor.” (Deacon, 2007)

Contestation

• International donor community agreed on desirability of SP provision• Variation - what that should comprise in DCs: for whom provided, and how and in

what form offered • European-type entitlement-based social minimum not central to vision of all• Disagreements between participants

• ‘the UN position’, conforming with the (European) welfarist and (ILO Recommendation 202) SPF vision, or,

• the more residual World Bank-type policy, which is concerned with residualist SSN provision, market-based solutions and challenges relating to risk, resilience and graduation

• Additional complexity -• the growing focus on ‘active’ social protection, • emphasis on labour market engagement, graduation, and transformation • Orientation towards the challenges of risk and resilience• Crisis response function

Contestation II

• Aspirations associated with social protection beyond the provision of a social minimum (major challenge in developing country contexts),

• Term ‘SP’ at risk of becoming used synonymously with the process and goals of development itself – broad and loose definition and objectives  

• Arguably some move to middle ground currently;• Nominal endorsement of the SPF among the key agencies • Discussion of equity in relation to the social protection agenda in the post-MDG/SDG

debates represents convergence on universal and rights based approaches - potential shift in favour of social justice.

• But adoption of a common language not necessarily imply a common analysis or desired end points

• Eg discussion of equity (WB, HLP) focussed on equity of opportunity, not redistributive agenda

• Unclear whether opportunity represented by Recommendation 202 will inform changes in key institutions at national and international levels

Recent developments

• Changing global context• Changes in the global labour market• The 2008/9 financial crisis• G20 Development Working Group• New strategies: World Bank, UNICEF, WFP• The Social Protection Floor 2012• SPIAC-B and donor coordination 2012• The post-2015 agenda – MDG and SDG

Challenges

• 1 Instrument Choice, Design and Implementation• Instrument choice, The Working Age Poor, Targeting and Universality, Cash Transfers

and Conditionality, Implementation

• 2 Sustainability • National demand and ownership

• 3 Financing • Financing innovations, Global funds

• 4 Donor Competition and Coordination • 5 Tension with macro-economic policy

• IMF macro-economic dominance

• 6 Beyond Income Security • Productive Safety Nets,Growth, Graduation, Transformation

• 7 Social Protection Systems and Crisis Response• 8 Contested Vision

• Rights, Social justice, Redistribution, Social minimum, Risk or certainty, Social protection as development

Opportunities

1. Instrument Choice, Design and Implementation

2. Sustainability

3. Financing

4. Donor Competition and Coordination

5. Tension with economic policy

6. Moving Beyond Income Security

7. Social Protection Systems and Crisis Response

8. Shared vision

Instrument Choice

• Develop evidence base to inform instrument choice, design and implementation options,

• Greater objectivity rather than reflecting institutional preferences or path dependency

• Harmonisation of programming and research• Improved evaluation - development of shared definitions and indicators

across programmes, institutions, and regions• Enable greater comparison of performance, meta analysis and cross

programme learning• Opening debate around Working Age Poor (WAP), given the recognition

of the scale of the WAP challenge, given recognition of global shifts in the nature of under- and unemployment.

Sustainability • Opportunity to promote greater national policy autonomy and ownership• Move away from donor-led /‘one size fits all’ and institutionally preferred policy ‘packages’• Promote bespoke programming choices and contextually designed support  • Promote greater coordination and harmonization within the donor community • Practical steps to enhance joint programming, eg shared data gathering and analysis initiatives, joint

evaluations, common situation analysis instruments and basket funding and joint programming• increase IDI efficiency, • improve quality across the IDI board,• require agencies to give up a degree of institutional autonomy and influence • require a deepening of trust and commitment between agencies • agreement of areas of common vision (the intended role of SPF). • reduce the opportunity costs of engagement on the part of national governments through a reduction

in the multiple parallel analytical, data gathering and financing and reporting processes currently in receipt of donor support.

• Greater IDI support for domestically initiated programming • IFI commitment to support rather than undermine domestic investment in the sector in contexts requiring

macro-economic stabilization. • Promote re-energised debate on international financing options, and support for national level dialogue on

options for capturing future mineral dividends for the provision of social dividends linked to social protection provision.

Financing

• Identify financing, both nationally and internationally, to provide basic coverage for all the extreme poor, and thence for the progressive expansion of systems, which currently provide only marginal coverage in many developing,

• Promote debate from an ideological/political perspective, exploring the reluctance to countenance any significantly extended redistributive agenda in IDI and national discourses

• Need advocacy with generalized, rather than single agency, mobilization around a call for increased financing.

•  Review innovations eg a global fund and transaction tax, mineral taxation, engaging with the mineral resource debate actively – consider

lessons from the RSR and other trust fund approaches

Donor Competition and Coordination

• Continued focus on donor harmonization and efficiency• Build on the SPIAC-B in promoting interagency work

• social protection data definitions and conceptual harmonization in terms of interventions and impacts, data gathering, data analysis, and social protection system performance,

• World Bank led SPARCS initiative on mapping provision • Support goodwill across the IDIs, and pooled financing for a public good to benefit of whole

sector• Utilise SPIAC-B potential as general forum for actively promoting the exchange of ideas,

experiences and innovation and identifying and developing issues, eg future financing• Create space for genuine dialogue and interchange between agencies• Require adequate intellectual and financial resources to take forward such initiatives,

recognizing the capacity constraints faced by many in the IDI community.  • SPF offers opportunity for coordination - provide a normative framework for social

protection internationally• However, if harmonization (Paris, Busan, Accra) is to be realized at international and country

level, formal processes and further international leadership guidance are required. • Require development and promotion of incentives for harmonization, and changes to

institutional culture, structure and practices.

Tension with economic policy

• Promote explicit debate on tensions between pursuit of social protection objectives, and the economic policy, (both micro- and macro-) promoted by the BWI with IDI support

• Need for principles to govern the policy dissonance between macro-economic and poverty/social justice objectives

• Also to explore relationship between the micro-economic issues (employment, taxation, trade, education etc) which also contribute to social protection performance

• Not consider social protection in isolation from economic policy in general

Moving Beyond Income Security

• Interest in the Productive Safety Net approach and the role of social protection in promoting active social protection and labour market participation

• Opportunity for critical interagency interrogation of growing evidence base relating to livelihoods development, food security, graduation and transformation to identify success determinants

• Growth of research in this area in recent years, need to take into account the implications of changes in the structure of the global economy and labour market

• Root the debate in the reality of social protection provision at country level – ie minimal and low level in many LICs

• Assess policy objectives relating to graduation and transformation in this light

Social Protection Systems and Crisis Response

• Opportunity to initiate critical discussion around the meaning of ‘systems development’ in relation to social protection

• Identify areas common interest and where incongruence of schemata

• Promote explicit discussion of implications and options for resolution

• Also promote open debate on tensions in promoting SP as both the provider of a social minimum and also as mechanisms for countercyclical crisis response

• Identify and address challenges, conceptually and in programming.

Shared Vision

• Articulation of SPF vision in Recommendation 202 and formal support across the IDIs represents both a challenge and also a key moment for the exploration of a contested agenda

• Opportunity for the articulation of the contested visions underlying the social protection project

• Explicit exploration of areas of agreement and dissent and the ideological impulses underlying them, - in many cases remained implicit heretofore

• Recognise ideologies and the pragmatism informing current institutional positions

• Recognise programming implications of the different stances to identify core areas for collaborative engagement to reduce future contestation.

• Particular challenges around equity (limited to equity of opportunity) and residualism vs universalism

Conclusion

• De jure requirement on IDIs to address social protection in line with Recommendation 202

• ‘The great consensus’ (Cichon, 2013)• Initial responses on the part of the IDIs show some signs of resistance to

the implementation of the SPF principles as the primary framework for future social protection and associated commitment to the progressive realisation of a social minimum (‘great ambivalence’)

• Challenge now is to consolidate • Support initiatives already underway in IDI policy and practice• Promote national sovereignty in social protection policy selection, design and

implementation• Develop responses to outstanding challenges in the sector

Recommendation 202, if supported by national governments and the IDIs, has the potential to provide a framework to support this process

Thank you

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