Hope for the Poor Found in Social Protection Schemes

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How does one improve chances of survival in a world mired with poverty? Where resources and opportunities are scarce? It becomes incumbent upon those who are in-charge of ensuring that the most basic services are accorded to the poor. And this is where social protection comes into play.

Social protection comes in many forms. Microfinance programs directed to the poor are one of those, while other forms such as conditional cash transfers for the poor in exchange for fulfilling obligations by the beneficiaries have dramatic results in staving off long-term impacts of poverty.

In the Philippines, for example, the Department of Social Welfare and Development has a conditional cash transfer program that gives out monthly cash to poor households provided that parents send their children to school. It’s not simply a dole out system, but a two-tiered approach to addressing poverty: (1) a short-term benefit of additional monthly cash; and (2) a guarantee that children from poor families will have a better chance of tomorrow.

The United Nations (UN) agrees in the power and benefits of social protection. According to the UN, improving social protection is the most effective way to combat poverty in developing countries. In addition to this, poorer nations are also coming up with innovative ways to ensure that their citizens have basic social security.

Michael Cichon, Director of the Social Security Department of the International Labour Organization, believes that social protection measures are the most potent ingredients in poverty alleviation. He told a news conference at the UN Heaquarters in New York City to launch a document entitled “Successful Social Protection Floor Experiences.” It was jointly compiled by the ILO and the UN Development Programme (UNDP).

“Social protection is one of the most powerful tools that any society has to combat poverty and to invest in its own social economic development,” Cichon said. “All we need in developing country context is 4 per cent GDP to reduce the poverty rate in a country by about 14 per cent.”

Cichon added that social protection schemes have succeeded in reducing poverty. It has also provided income security in developed countries over the years. As a result of this progress, developing countries are now following the success stories of social protection and have included cash transfer arrangements and universal health care in their programs of government.

“The real innovation these days comes from the global South,” Cichon said. He noted that in the next 10 to 15 years an estimated 1.2 billion people in developing countries will have a means of social protection, including food security, health services for all and old-age pensions. In the past, the availability of these protections were close to minimal if not zero.

The ILO is preparing a meeting in June with Governments, employers and workers from all 183 of the agency’s member States to draw up a long-term social protection strategy.

At a meeting in Oslo last September, ILO Director-General Juan Somavia and International Monetary Fund (IMF) Managing Director Dominique Strauss-Kahn agreed to explore the concept of a “social protection floor” for people living in poverty and those in vulnerable situations within the context of a medium to long-term strategy.

Currently the world spends 17 per cent on social protection, but that is 19 per cent in developed world and only 4 to 4.5 per cent in developing countries.

However, there are also challenges to make sure that social protection becomes available to a great number of people. The current global economic crisis has forced developed countries to look at cutting deficits and public expenditure, consolidating budgets and financing fiscal stimulus packages by cutting back on social spending.

“What it means in the end, and I think we should all understand that, is that the old, the disabled, the sick and the poor are going to pay for the crisis for the next few years,” Cichon warned. “And it’s a pretty straightforward and perturbing message.”

The “Successful Social Protection Floor Experiences” is a compilation of successful case studies from developing countries intended to be part of a broader knowledge-sharing process, according to Francisco Simplicio of UNDP’s Special Unit for South-South Cooperation.

“The experiences documented here advocate for a careful analysis of the capacities, needs and existing [social protection] schemes in place that will enable and inform policy-making processes and the gradual building up of social services,” Simplicio said.