NEWS

WIRES

OTHER

Five Out of Every Seven People in World Lack Adequate Social Security

With more than five out of every seven people in the world lacking adequate social security, a high-level United Nations panel today called for guaranteeing basic income and services for all, not only as a means to ensure peace and stability but also to boost economic growth.

Measures providing income security and scaling up essential health services are affordable even in the poorest countries, costing as little as 1 to 2 per cent of gross domestic product (GDP), although international support is needed for some low-income countries, with donors providing predictable multi-year financial aid, according to the panel's report - Social Protection Floor for a Fair and Inclusive Globalization.

This floor would guarantee basic income in the form of social transfers in cash or kind, such as pensions, child benefits, employment guarantees and services for the unemployed and working poor, while providing universal access to essential affordable social services in health, water and sanitation, education, food, housing, and other services defined according to national priorities.

The report's preliminary conclusions were presented to a ministerial meeting of the G-20 group of major industrialized and developing economies last month and won an immediate pledge by the group to support new measures aimed at extending social protection worldwide as a means of reducing poverty, stimulating economies and hedging against the impacts of economic crises.

The report calls on G-20 leaders at their summit in Cannes, France, next week to consider an "action plan" to implement such protection floors, whose specifics would be developed at the national level, through existing and new financing mechanisms. Some countries, such as El Salvador, Benin, Mozambique and Vietnam, could provide the floor for as little as 1 to 2 percent of GDP, it adds.

"Extending social protection is a 'win-win' investment that pays off both in the short term, given its effects as macroeconomic stabilizer but also in the long term, due to the impacts on human development and productivity." -Ms. Bachelet

The social protection floor differs from the social safety net in that makes protection a full and permanent component of the development strategy for inclusive growth, going beyond the temporary 'crisis management' and 'social relief' synonymous with safety nets.

According to the report, an estimated 5.1 billion people lack adequate social security or social protection worldwide, while just over 15 per cent of the jobless are receiving some form of unemployment benefits.

Among possible measures to finance the floor, a background paper cited debt cancellation, revenues from natural resources, improved tax collection in developing countries, as well as a financial and currency transaction tax, debt swap mechanisms, solidarity levies on airline tickets, and steps to facilitate remittances.

Source: United Nations