This blog post is authored by Sheila Marnie, Qiushi Yue, Christina Behrendt, and Mira Bierbaum.
Background and motivation
This blog summarises the exchanges and key messages raised by the expert panel at the webinar ‘‘Innovations in extending social protection to rural populations: Perspectives for a common FAO and ILO approach’’, held on 1 April 2021 and jointly organised by the Food and Agriculture Organization of the United Nations (FAO) and the International Labour Organization (ILO).
Social protection is a fundamental human right that is also key to realizing other economic, social and cultural rights, including the rights to food, health and education and addressing poverty and vulnerability, promoting decent work and inclusive economic growth, and increasing resilience to shocks. However, many agricultural workers and other rural populations, do not have access to adequate social protection.
The COVID-19 pandemic has exposed the large and persistent gaps in coverage, comprehensiveness and adequacy of social protection. Although the pandemic has shown once more the critical importance of social protection for protecting lives and livelihoods, as reflected in the surge of new social protection measures following the outbreak of the pandemic, most of the measures that have been put in place are temporary, some of them have already been phased out and gaps in coverage remain.
To address the crisis in a more effective and lasting way and increase resilience, more permanent solutions are necessary to reinforce social protection systems, particularly with respect to ensuring universal access to adequate social protection for all, including rural populations. Rural populations are three times more likely to live in extreme poverty (defined as living on less than $1.9 per day) than urban populations and are more likely to be in informal employment. Rural populations also face higher exposure to various risks, including working poverty, malnutrition and hunger, poor health, work-related injuries, natural disasters and climate change. It is therefore essential to accelerate efforts to extend social protection to all by building on the current momentum, as well as previous experiences and lessons learned.
During this webinar, the joint FAO/ILO report on “Extending social protection to rural populations: Perspectives for a common FAO and ILO approach” (available in English, French, and Spanish) was launched and government representatives from Argentina, Jordan, Kenya and Mongolia shared and discussed innovative approaches to extending social protection to rural populations (both the recording and the presentations are available).
Alejandro Grinspun, Senior Economist, Inclusive Rural Transformation and Gender Equality Division of the Food and Agricultural Organisation, welcomed the audience to the webinar and emphasised the timeliness and relevance of the FAO/ILO joint report on expanding social protection coverage to rural populations. This is due firstly to the reversals in poverty reduction trends and increases in poverty that the world is witnessing in the wake of the COVID-19 pandemic; and secondly due to the gaps in social protection’s coverage and responsiveness which have been exposed during the response to the pandemic. The report is also timely due to the policy attention that the pandemic has brought to the need to expand national social protection systems and make them more adequate and comprehensive. Many countries have responded by expanding coverage of social protection both horizontally and vertically, and have worked on strengthening delivery systems, including through accelerating the introduction of digital technology. However, the task now is to ensure that these responses do not remain short term. The crisis has shown that we still have a long way to go in achieving the universal right to social protection, as aspired to in SDG 1: sustainable and innovative efforts to expand coverage especially for those working in the informal economy and for rural populations are more topical and relevant than ever.
Extending social protection to rural populations: Perspectives for a common FAO and ILO approach
A summary of the main findings and recommendations of the joint report was presented by Benjamin Davis, Director, Inclusive Rural Transformation and Gender Equality Division of FAO, and Shahra Razavi, Director, Social Protection Department of the ILO. Despite the fact that 75 per cent of the world’s poor population reside in rural areas, many of them cannot realize their right to social protection. Rural populations share commonalities, including a higher risk of living in extreme poverty, high levels of informality and precarious employment, and heightened risk of exposure to environmental risks and natural disasters. However, they are also extremely heterogeneous, and in expanding coverage of social protection, the specific risks and needs of different sections of the rural population have to be taken into account. The report identifies the main risks faced by rural populations, and also the most common barriers encountered in extending social protection coverage to them. These are categorized under the headings of legal, financial, and institutional/ administrative barriers.
The report provides specific examples of these barriers, but also innovative solutions for overcoming them, illustrating these through concrete examples from countries where they have been tested and introduced.
The report concludes with key recommendations based on the lessons learnt that FAO and ILO have identified as being instrumental to planning and implementing the effective extension of coverage to all rural populations:
Learning from country experiences: Innovative approaches in Argentina, Jordan, Kenya, and Mongolia
More than two-thirds of the Kenyan population live in rural areas, many of them working in the informal economy and facing much larger risks of living in poverty, malnutrition or poor health than urban populations. Cecilia Mbaka, Secretary for Social Development and Head of the National Social Protection Secretariat in the State Department of Social Protection outlined Kenya’s approach to ensuring the right to social security, which is enshrined in Article 43 of its 2010 Constitution and reflected in legal and policy frameworks, including the National Social Protection Policy. Specifically, the Kenya Social and Economic Inclusion Project (KSEIP) aims to strengthen delivery systems for enhanced access to social and economic inclusion services, and shock responsive programmes for poor and vulnerable households. Different interventions have been tested, with a focus on finding efficient and sustainable options that can be scaled up in rural areas, acknowledging the diversity of regions and population groups, and with a strong focus on linkages with existing programmes and services as well as capacity building. Two specific aspects mentioned were, first, the importance of grievance and case management systems to build awareness and trust in the system. Second, both the National Health Insurance Fund and National Social Security Fund have used mobile phone technology to facilitate registration and contribution collection.
Hazim Rahahleh, General Director of the Jordanian Social Security Corporation, outlined Jordan’s strategy to extend social protection coverage through the combination of contributory and non-contributory schemes, and by increasing the comprehensiveness of protection. Thanks to this strategy, social insurance coverage was extended to approximately 65 per cent of the labour force; the remaining 35 per cent mainly work in small firms with less than five employees or are self-employed, including in agriculture. Several measures have been implemented to overcome challenges to extend coverage. First, related to payment capacity, as contribution rates are often beyond the contributory capacity of small firms or self-employed persons, some categories of contributors may choose between different contribution rates, for instance by only being partially included or being exempted from the old-age insurance scheme, while being covered for maternity or unemployment protection. Second, eligibility criteria of non-contributory schemes were changed to include also poor workers, as their exclusion had created adverse incentives. Finally, limited enforcement capabilities have been addressed by extending the regulatory framework to informal sectors, in particular in the agriculture sector, contributing to its formalization, and by extending social protection coverage by linking it to licensing processes.
Ezequiel Barbenza, Director of Registration and Formalization, Ministry of Agriculture, Livestock and Fisheries of Argentina, provided a summary of the history of the simplified tax and contribution payment mechanism, the social monotributo, in Argentina. The social monotributo is a simplified payment mechanism designed to incentivise and enable formalization among poor rural households, which, apart from formalization (with the related advantages of expanded access to markets and financial services), provides them with access to health insurance and pension rights. By 2018, this system had allowed over 50,000 rural families to access these rights. Since 2018, the system of social monotributo is in the process of being extended and adapted to cover all agricultural smallholder (family) producers. A prerequisite for implementing the system has been the creation of the national farmers’ registry, which is used to identify those who are eligible to benefit from the system, but also those who are currently excluded from it. In fact, registration is a prerequisite for accessing pension and health insurance rights. The adaptation of the social monotributo system is still ongoing. It has required developing and putting in place cross-sectoral approaches involving several ministries; and also measures to take into account the lack of connectivity in remote rural areas; outreach to address the lack of awareness among farmers of their rights; and adaptation to take into account the lack of capacity of agricultural producers to respect the system of monthly payments due to their unstable income patterns.
Ariunzaya Ayush, Minister for Labour and Social Protection of Mongolia, described Mongolia’s social insurance system, which was established in 1995, and how it has been adapted to make it legally possible for rural target groups, including herders and the self-employed, to participate in a voluntary basis. Administrative and institutional barriers to accessibility, especially for remote populations, have been addressed through the establishment of one-stop-shops in all of Mongolia’s provinces, which means that people can access services more quickly and at a low cost. Moreover, the government has introduced flexible social security contribution schedules to account for the volatility of rural incomes. In response to the COVID-19 pandemic, government funding was made available to pay a social insurance premium for 170,000 voluntarily insured people in 2020. There has been an increasing introduction of mobile and digital technology to facilitate access and delivery of benefits. Herders and the self-employed have been able to join or access their social insurance schemes using mobile and internet banking. Information on social protection rights and status has been made accessible online including through e-government services. In 2021, an electronic pension booklet was introduced, and retirees were provided with bank accounts and cards, which has helped ensure increased transparency and efficiency in the pension system. Minister Ayush said that Mongolia was still learning from other countries in its attempts to improve its social protection system, especially with regard to improving and adapting the legal framework.
What next? Towards universal social protection
Christina Behrendt, Head of the Social Policy Unit at the International Labour Organization, wrapped up the seminar by highlighting three take away messages. First, extending social protection coverage to rural workers and rural populations is possible – by proactively adapting systems and schemes to their needs, listening attentively to their concerns, making it as simple as possible, and raising awareness and trust in systems. Second, a comprehensive and systemic approach is essential; social protection policies need to be closely coordinated with agriculture and rural development policies, employment policies, etc., thereby also contributing to productivity and facilitating transitions to the formal economy. Finally, as social protection systems are at a crossroads, policy makers need to move ahead together with a clear plan and time frame to make sure that everybody is covered through coherent and integrated systems to achieve the Sustainable Development Goals.
- FAO Social protection framework
- FAO Social protection coverage toolkit
- ILO resource package on extending social security coverage to workers in the informal economy. Lessons from international experience
- Strengthening coherence between agriculture and social protection to combat poverty and hunger in Africa: Framework for Analysis and Action
- Joint UN Social Protection and Human Rights web platform
- World Social Protection Report 2017-19: Universal social protection to achieve the Sustainable Development Goals