““Extending social protection: the way Extending social protection: the way towards social justice - towards social justice - ILO policy in the ILO policy in the

MENA countries”MENA countries”

Organised by the Middle East Social Policy Network Organised by the Middle East Social Policy Network (MENA) at the University of Bath Institute for Policy (MENA) at the University of Bath Institute for Policy

ResearchResearchTuesday 3 December 2013Tuesday 3 December 2013

Ursula KulkeUrsula KulkeSenior Regional Social Security Specialist, ILO Regional Office for Arab Senior Regional Social Security Specialist, ILO Regional Office for Arab States, BeirutStates, Beirut

Beyond International Security: Beyond International Security: Social Security and Social Welfare Social Security and Social Welfare in the Middle East and North Africa in the Middle East and North Africa - What are the research and policy - What are the research and policy

choices? choices?

Social protection: An Social protection: An instrument for poverty instrument for poverty

reduction and social reduction and social cohesioncohesion

Social protection is a human right ( Articles 22, 25,26,27 of the Universal Declaration of Human Rights)

1. We know that from more than one century of history of the modern welfare state that social transfers and services are powerful policy instruments to combat poverty, insecurity and inequality and ...to achieve the MDGs

2. Social protection is an indispensable component of the policy mix to create growth, and which includes education, employability enhancing policies, macro policies creating jobs etc.

3. Social protection is an economic necessity to unblock the full economic potential of a country, only people that are healthy, well educated and well nourished can be productive

4. There is now widespread acceptance that social protection/security serve as social and economic stabilisers in times of crisis

5. Social protection makes growth equitable, builds social cohesion and makes growth more sustainable

Social social protection:Social social protection:Regional overviewRegional overview

Few Arab states have developed coherent national social security policies.

Most of the Arab countries have social insurance systems which only provide long-term benefits (old age, disability and survivors’ pensions and employment injury benefits).

Only few Arab countries offer short-term benefits: Bahrain and Jordan are the only countries which have unemployment benefits in place and Jordan is the only one which has a maternity insurance scheme in place.

Most countries of the region lack protection against catastrophic health expenditure, a critical factor contributing to vulnerability and poverty.

None of the countries in the region has a rights-based social assistance scheme.

Social security programmes: Social security programmes: Regional overviewRegional overview

Bahrain

Iraq

Jordan

Kuwait

Lebanon oPt Oman

Qatar

Saudi Arabia

Syria

UAE

Yemen

Old age SI SI SI SI OI … SI SI SI SI SISurvivors SI SI SI SI … ... SI SI SI SI SIInvalidity/disabiliy

SI SI SI SI OI … SI SI SI SI SI

Employment injury

SI … SI SI … … SI SI SI SI …

Sickness … … … … SI … … … … … … …Medical care … … … … SI … … … … … … …Maternity … … SI … … … … … … … … …Unemployment

SI … (SI) … … … … … … … … …

Family … … … … SI … … … … … … …Social assistance

SN SN SN SN SN SN SN SN SN SN SN SN

SI = Social Insurance; OI = Other Ins. Arrangement (Prov. Fund, etc.); SSA = statutory social assistance (rights- based) ;SN = Safety Net Programme (not rights-based)Source: ISSA Observatory Country profiles

Social security programmes: Social security programmes: Regional overviewRegional overview

Algeria Egypt Libya Morocco Sudan Tunisia

Old age SI SI SI SI SI SISurvivors SI SI SI SI SI SIInvalidity/disabiliy

SI SI SI SI Si SI

Employment injury SI SI SI No info Si SI

Sickness SI SI SI SI … SI

Medical care SI SI Si SI … SIMaternity SI SI No info SI … SIUnemployment SI SI No info … … SNFamily TF … … SI … SISocial assistance

SN SN SN SN … SN

SI = Social Insurance; OI = Other Ins. Arrangement (Prov. Fund, etc.); SSA = statutory social assistance (rights- based) ;SN = Safety Net Programme (not rights-based), TF = Tax financedSource: ISSA Observatory Country profiles

Social security deficits: Social security deficits: Coverage of contributory Coverage of contributory

schemesschemes

There are also considerable coverage deficits in the region.

While in most countries, existing schemes cover workers in the public sector and workers in the private sector on regular contracts, other workers, such as temporary, agricultural, domestic, informal and migrant workers, and to a large extent self-employed workers are excluded from legal coverage.

Due to low levels of formal employment participation of women, their social insurance coverage is even lower.

Social security deficits: Social security deficits: Coverage of pension Coverage of pension

schemesschemes

Social security deficits:Social security deficits:Universal subsidies at the expense of more effective Universal subsidies at the expense of more effective

programsprograms

Source: World Bank 2012, Inclusion and ResilienceSource: World Bank 2012, Inclusion and Resilience

The average MENA country spends 5.7 percent of GDP on food and fuel subsidies, as opposed to 1.3 percent of GDP on transfers in the average benchmark country

Source: World Bank 2012, Inclusion and ResilienceSource: World Bank 2012, Inclusion and Resilience

Social security deficits: Universal Social security deficits: Universal subsidies are inefficient and pro-richsubsidies are inefficient and pro-rich

Source: World Bank 2012, Inclusion and ResilienceSource: World Bank 2012, Inclusion and Resilience

Universal subsidies and in particular, fuel subsidies have staggering leakages to the non-poor

The Social Protection Floor The Social Protection Floor (SPF)–Initiative(SPF)–Initiative

In April 2009, the UN Chief Executives Board (UN CEB) agreed on nine joint initiatives to confront the crisis, among them the Social Protection Floor Initiative

The SPF Initiative aims at joint global and local UN action lead by ILO+WHO to promote social transfers and access to essential services for the poor and vulnerable

The SPF is a global and coherent social policy concept that promotes nationally defined strategies for the provision of a minimum level of income security and access to essential services for all

For such purposes, the SPF promotes a holistic and coherent vision of national social protection systems, rights-based, as a key component of national development strategies

Transfers in cash and in kind should guarantee geographical and financial access to essential services such as water and sanitation, education, etc.

Transfers in cash or in kind:

The Social Protection Floor: The Social Protection Floor: four nationally-defined four nationally-defined

guaranteesguarantees

ILO’s new social security ILO’s new social security paradigm:paradigm:

The two dimensional strategyThe two dimensional strategy

• Family Benefit • Sickness Cash Benefit• Medical Care Benefit• Unemployment Benefit• Maternity Benefit • Survivors’ Benefit • Invalidity Benefit• Old-age Benefit • Employment Injury Benefit

Public Sector Employees

Private Sector Employees and

voluntarily insured

Self-employed , not covered by

Social insurance

Informal Economy

Non-employed Working

Age

• Universal Health Care• Child benefit• Assistance for Unemployed and Poor• Universal Old-Age and Disability Pension

Horizontal dimension:

Guaranteeing access to essential

health care and minimum

income security (Social

Protection Floors

Recommendation No.

202)

Vertical dimension: progressively

ensuring higher levels of

protection guided by ILO Convention No.102 and higher-level standards

13

Principles for the Principles for the implementation of the two-implementation of the two-

dimensional strategydimensional strategy

The Social Protection Floor can The Social Protection Floor can be achieved through different be achieved through different

systemssystems

national choicenational choice

Nationally guaranteed Nationally guaranteed outcomesoutcomes

The Social Protection Floor is The Social Protection Floor is affordable: Cost of basic affordable: Cost of basic

transferstransfers

In percent of GDP

Financing Financing strategiesstrategies

1. Domestic resource mobilisation – Enhance the efficiency and effectivenes of tax collection– Reallocate expenditure – reallocate existing public spending– Broaden tax baseI and increase overall tax rates– Reduce tax evasion – Introduce self-financing social insurance systems

2. International resources (transitional financing) – Project financing to build national delivery capacity– International financing of health care goods and services – People-to-People Partnerships: Global Social Trust

Successful SPF Successful SPF ExperiencesExperiences

ArgentinaArgentina Asignación Universal por Hijo (AUH) (Universal Child Allowance)

Coverage: 85% of Argentinian girls and boys Impact: Reduced poverty (-22%) and extreme poverty (-42%)

IndiaIndia Mahatma Gandhi National Rural Employment Guarantee Scheme (Wage employment programme)

Coverage: 52.5 million households (50% of women participants) Impact: Increase in minimum wages for agricultural workers, decreased out-

migration from villages, women’s empowerment Costs: 1.5%of GDP (2008/09)

ThailandThailand Universal Coverage Scheme (Universal health care)

Coverage: 80% of the population Impact: 88,000 households (2008) were prevented from falling below poverty line

BrazilBrazilBolsa Familia (Conditional cash transfer)

Coverage: 26% of the population Impact: Reduced the poverty gap by 12% between 2001 and 2005 Costs: 0.3 % of GDP (2008/09)

The Rural Social Insurance Programme (Non-contributory pension for the rural poor) Coverage: 80% of agricultural workers – 66% of rural population Impact: Reduction of 4 million poor people Costs: 1.5% of GDP (2008/09)

South AfricaSouth Africa Child Support Grant (Means-tested non-contributory cash transfer)

Coverage: 10 million children Impact: Reduced the poverty gap by 28.3% Costs: 0.7 % of GDP (2008/09)

Successful SPF Successful SPF ExperiencesExperiences

ILO’s Recommendations – ILO’s Recommendations – development of coherent social development of coherent social

security systemssecurity systems

Coherent and comprehensive social security systems, embedded in wider economic and social policies, with the double objective of:

Developing sustainable and comprehensive contributory social security systems for workers in the formal economy (vertical dimension)

Establishing national social protection floors for those who are not covered by the formal social security system, providing minimum income security and access to essential medical care (horizontal dimension)

And applying the following principles: Universal and progressive extension of social security coverage Solidarity between rich and poor and generations Benefits as an legal entitlement and right Collective and actuarial fairness of contributions and benefits levels Sound financing of social security schemes Responsibility for governance and tripartite administration

ILO’s Recommendations – ILO’s Recommendations – development of coherent social development of coherent social

security systemssecurity systems

What to do:

Creating the necessary fiscal space (SPF financed by domestic resources)

Political will

Cost-control mechanism

Effective institutions Maximize administrative capacity to deliver benefits efficiently and to minimize waste

and misuse of resources

Sound implementation structure and good governance: Process for efficient delivery, monitoring and evaluation and proper financial

management

Progressive formalization of the economy

High levels of productive employment

Comprehensive social security systems represent important social tools that can temper exclusion and latent or simmering unrest.

Thereby they can contribute to creating more cohesive and inclusive societies.

National social protection floors go beyond providing basic social relief: They also fosters forms of democratization that build

citizenship, and Break down barriers that impede fuller participation by

the poor in political processes that affect their lives.

Comprehensive social security with Comprehensive social security with a social protection floor - political a social protection floor - political

and institutional stability, and and institutional stability, and social cohesionsocial cohesion

THANK YOUTHANK YOU