The recent global economic and financial crisis revealed once again
the importance of social protection in shielding the poorest and
most vulnerable people from the worst impacts of a sudden shock
to the economy. Social protection programmes such as cash transfers and
expanded public works were also important instruments for raising domestic
demand in many of the stimulus packages that were introduced to counter
the downturn. As the world starts a fragile recovery, however, there may be
a temptation to roll back programmes as the intensity of the economic shock
dissipates. Countries could instead explore opportunities for prioritising and
institutionalising social protection programmes.
Much evidence suggests that, when properly designed and implemented, social
protection not only protects the vulnerable but is also an investment in future
growth and prosperity. In this light, the aftermath of the global crisis provides an
opportunity to improve and expand social protection programmes where they
already exist, and to create new ones where they are absent. Social protection
should not be seen as merely a safety net to be deployed when times are
difficult; neither is it a panacea for development, but it can be key to promoting
strong and inclusive growth.
A recent South-South dialogue organised by IPC-IG and held in Johannesburg
from 11 to 14 October 2010 showed that governments in the global South are
comfortable with broad definitions that emphasise the expansion of capabilities
and opportunities. For instance, in South Africa social protection “seeks to
provide the basic means for all people living in the country to effectively
participate and advance in social and economic life, and in turn to contribute to
social and economic development.” Presentations at the dialogue from Zambia,
Brazil, East Timor and other countries used similar language, placing formal and
informal mechanisms for social protection at the very core of their national
development strategies.
Traditionally, social protection programmes have been regarded as important
because of concerns for equity and because they are a means of directly
alleviating poverty. Emerging micro-level evidence, however, shows that such
programmes can have strong efficiency effects and thus can be growth-enhancing.
This can occur through increasing poor people’s access to assets—by enabling
them to buy livestock, building productive infrastructure such as roads and
irrigation, promoting education and health, or reducing risk so that people can
use assets more efficiently.
Moreover, there is substantial evidence that the inability of many families to
manage and cope with risks leads to sub-optimal investment and consumption
choices that may harm economic efficiency. Social protection can also contribute
to economic growth by reducing inequality and strengthening social justice and
cohesion. On the other hand, concerns about perverse incentives and leakages
can be addressed through well designed programmes. Expressions of concern
about the unaffordability of social protection programmes are often
exaggerated, especially in view of the programmes’ benefits.
According to the participants at the South-South dialogue, this also means that
the current practice of viewing social protection as the exclusive purview of
ministries of gender and social development needs to be rethought. While these
ministries have a clear role in the implementation of specific aspects of the social
protection agenda, there is a need to involve a range of other stakeholders more
directly. Clearly, community representatives have critical roles to play, namely
in ensuring accountability and in the effective delivery of transfers and services.
Elected representatives in legislatures are instrumental in providing the legal basis
for a country’s social protection system and for institutionalising citizens’ rights.
In the executive, ministries of finance and planning need to drive discussions not
only on the fiscal space for financing social protection programmes (an important
issue in its own right), but also on how to entrench social protection more
effectively in a country’s longer-term development strategy, as a means of
making the growth process stronger, more resilient and more inclusive.