Profiles of pre-COVID-19 social protection systems in Bhutan, Bangladesh and Maldives and a snapshot of their COVID-19 responses
The webinar Profiles of pre-COVID-19 social protection systems in Bhutan, Bangladesh and Maldives and a snapshot of their COVID-19 responses was the sixth event of the Social Protection in South Asia series. It took place on October 22, 2020, and was jointly organised by the IPC-IG and UNICEF. The webinar was moderated by Abdul Alim (UNICEF ROSA) who was joined by presenters Fabianna Ferreira, Krista Alvarenga (both IPC-IG), and Mekonnen Woldegorgis (UNICEF Bangladesh).
The webinar summarised the findings of five comparative reports on the social protection landscape in South Asia that were authored by the IPC-IG in collaboration with the UNICEF Regional Office for South Asia and Country Offices. Its main focus was on key takeaways and cross-cutting themes from the five reports for Bhutan, Bangladesh, and the Maldives as well as a snapshot into the response of each of the three countries to the COVID-19 crisis analysed in a recent IPC-IG and UNICEF ROSA (2020) policy brief. Lastly, the webinar offered insights into priorities for the social protection systems of Bhutan, Bangladesh, and the Maldives moving forward and highlighted important aspects for addressing structural and circumstantial challenges in the countries’ social protection landscapes.
You can see the presentation here and watch the recording here.
Bhutan: The COVID-19 response as a catalyst for social protection expansion?
Presentations were kicked off by Krista Alvarenga who delved into the most pertinent features of Bhutan’s social protection system and offered a snapshot into the country’s response to COVID-19. While the country’s social protection system appears to leave room for a comprehensive expansion on almost all fronts, the social protection response to the crisis opens up an opportunity for turning emergency social protection efforts into a lasting expansion of the social protection system.
While Bhutan’s constitution mentions social protection, it does so merely as a policy principle rather than an enforceable right. Furthermore, the country is a member of merely two of the nine core Human Rights Instruments and its social protection programmes lack specific, statutory legislation.
On the upside, Bhutan features the region’s second highest relative social expenditure level largely driven by the highest education expenditures as a share of GDP in South Asia. At the same time, while government expenditure on health and education is high, some outcomes remain lagging behind and social assistance spending is low. One possible option to expand fiscal space here is the planned reform of the goods and services tax.
Most of Bhutan’s spending on social protection accrues to its flagship school feeding programme that switched to the provision of take-home rations during the crisis. In addition to this, the country features the Rural Economy Advancement Programme (REAP), as sustainable livelihoods initiative targeting the poorest regions of the country. However, the programme’s coverage is rather small.
Possible additions to Bhutan’s social protection system could be a flagship cash transfer. During the COVID-19 crisis, the country rolled out the Druk Gyalpo’s Relief Kidu, an unconditional cash transfer covering 23,000 individuals with a focus on those who partially or entirely lost their livelihoods during the crisis. Additionally, the scheme also explicitly contained provisions to cover Bhutanese workers who returned home from abroad due to the crisis and had no other source of income. Benefit levels for the Druk Gyalpo’s Relief Kidu varied with the number and age of children in the household.
Since Bhutan’s social protection system so far lacks gender-sensitive components, another key programme to introduce in the future would be a cash transfer targeting pregnant and lactating women. A promising project is thus the Accelerating Mother and Child Health Outcomes (AMCHP) programme, a CCT targeting maternal, neonatal, and child health during the child’s first two years of life, that is due to be rolled out still this year.
Bangladesh: A dispersed social protection system with scope for streamlining and an investment boost
After these interesting insights into Bhutan’s social protection system, Fabianna Ferreira continued with Bangladesh. Throughout her presentation, it became evident that Bangladesh possesses a very broad social protection system featuring a multitude of initiatives. This lies a broad fundament on which to build on but necessitates further streamlining and a boost in social (assistance) spending.
On the legal side, Bangladesh is a state party of all but one core Human Rights Instruments. Furthermore, the country has established social protection legislation in the form of the Voluntary Social Welfare Agencies law (1961 amended 1973) and the Foreign Donations Act, (2016) though only one out of eleven social assistance programmes in the country has a regulatory framework.
One of the key areas for improvement in Bangladesh is the level of social spending which is the lowest in the region. Bangladesh’s health system is heavily privately funded and regressive, and social assistance expenditure is low. At the same time, health outcomes are surprisingly good in the regional comparison and social assistance benefits are well targeted meaning they have a progressive distributional impact. In order to expand fiscal space for social spending, one possibility could be expanding on tax collection which sits at 6.1 per cent of GDP, the lowest in the region. The focus here could be on income and corporate tax collection.
Turning to key design features of Bangladesh’s social protection system, the country’s eleven social assistance programmes cover a wide range of programme types from in-kind transfers to cash transfers targeting vulnerable groups, conditional cash transfers incentivising education at all education levels, and workfare programmes. Additionally, an interesting observation is that many programmes in Bangladesh have multiple components such as the Maternity Allowance for Poor Lactating Mothers (MAPLM) which features cash transfers along with social care services and professional training and the Public Food Distribution System (PFDS) boasting ten different components varying in terms of their purpose, operational format, targeted population, and benefit values. Lastly, many of the programmes in Bangladesh have gender-sensitive provisions either targeting women and women’s issues directly or providing priority access to programmes such as the Employment Generation Programme for the Poorest (EGPP), a cash-for-work scheme. Evaluations of four of the flagship programmes in Bangladesh, two scholarship CCTs, the MAPLM, and the EGPP, have generally found programmes to bring about desirable effects.
During the COVID-19 crisis, Bangladesh launched several initiatives, many linked to horizontal and vertical expansions of existing schemes. For example, Bangladesh initiated an emergency cash transfer to 5 million vulnerable families, expanded existing schemes to provide an emergency food transfer, vertically and horizontally expanded food subsidies, provided subsidised credit for payroll and to the self-employed, horizontally expanded pensions, and delivered biscuits to the homes of children enrolled in the school feeding programme who could not get their meals at school due to closures.
Fabianna finished her presentation with a number of succinct policy recommendations for Bangladesh’s social protection system.
A social stimulus package for Bangladesh to combat the economic fallout of COVID-19
Directly linking to Fabianna’s presentation, Mekonnen took over and provided insights into the havoc the crisis wreaked for livelihoods in Bangladesh. In particular, he offered a snapshot into an assessment of the economic fallout of the crisis and simulations of the macro and distributional impact it brought about as explored in a recent study by UNICEF, the Bangladesh Planning Commission and Development Pathways. Based on these insights, Mekonnen argued in favour of a large(r) social security stimulus package mitigating the adverse effects of the crisis and aiding the economic recovery.
The adverse effects of COVID-19 may push Bangladesh into its first recession in 45 years. Growth may slow down from pre-crisis projections of 8.2 per cent and might even enter negative territory to as low as a 3.4 per cent contraction in a high-impact scenario. A sector hit particularly hard is manufacturing, most notably the large Bangladeshi garment sector, that is hit by supply and demand shocks. In line with these projected decreases in economic activity, the unemployment rate may sore to 11.6 per cent leaving 5.2 million new people without a job. Half of these newly unemployed accrue to the services sector with another 1.7 million in the industry sector. Losses of livelihoods may impinge greatly on children and young people when households adopt coping strategies that come at their expense. As a result, over a third of Bangladeshi people and 41 per cent of children under 15 might live below the national poverty line after the crisis.
Positing that a social stimulus package would reduce the severity of the economic slump experienced, spur a quicker recovery, and might set the country on a higher and long-term growth trajectory, Mekonnen argued that the arguments in favour of large-scale investment in social protection are manifold. Particularly demand-dependent sectors, such as agriculture and services, would benefit greatly from such stimulus.
Given that targeting performance of existing programmes would be poor and the current government emergency social protection package far too low in value, Mekonnen proposed the introduction of universal lifecycle transfers replacing the current one-off payments during the crisis. This would be in line with recent calls by major international organisations such as the IMF, the World Bank, and the United Nations.
Lastly, he argued that, while such transfers are expensive, they would eventually be more cost-effective than failing to invest.
Maldives: Strong legal and fiscal backing but room for gender-sensitive extensions of social protection
The webinar’s presentations were capped off with a look at social protection before and after the crisis in the Maldives. Generally, the small island state showcases by far the highest levels of social spending in the region with tendencies to move toward universalisation of the social protection system. Furthermore, social protection builds on a strong legal fundament in the Maldives. At the same time, gender-sensitive considerations could be given more room in the design of initiatives in the future.
In the legal domain, Maldives is a state party to seven out of nine Core Human Rights Instruments and establishes social protection as an enforceable right for children, youth, elderly and disadvantaged persons through its constitution. All flagship social protection programmes analysed have legal backing. The laws underpinning social protection in Maldives include the National Social Health Insurance Act (2008) and the National Social Protection Act (2014), as well as the new Child Rights Protection Act (2019). Furthermore, five out of seven flagship initiatives are further governed by their own regulatory frameworks. These frameworks generally showcase high compliance with a human rights-based approach in that they set precise eligibility requirements, define roles and responsibilities of stakeholders well, and ensure the predictability of benefits. However, there is some room for improvement on transparency, complaints and appeals mechanisms, and participatory channels.
With 15 per cent of GDP, Maldives spends the most on social issues in South Asia. Especially health spending is high driven by universal, non-contributory health insurance for Maldivians. These high levels of spending also show in outcome indicators: life expectancy at birth is an impressive 78 years and primary and lower secondary education is quasi universal. Furthermore, the country spends one per cent of GDP on social pensions. These expenses are financed by high tax revenue of 20 per cent of GDP with the tax system being regressive though.
Among others, Maldives’ social protection system features two conditional cash transfers (CCTs), two unconditional cash transfers, and a non-contributory universal health insurance. The CCTs are aimed at improving education outcomes and are conditional on school attendance. These initiatives feature a number of child-sensitive components and high coverage across the education and health domain, however, a nutrition initiative targeting children (such as a school feeding programme) is missing. Furthermore, gender-sensitive components such as targeting or prioritising women are absent in Maldives’ social protection system.
During the COVID-19 crisis, livelihoods depending on Maldives’ social protection sector were hit particularly hard. To combat the adverse fallout of the crisis, Maldives took a number of social protection measures across social assistance (utility and internet subsidies of 30-50 per cent), social insurance (a wage subsidy of MVR 5,000 for those laid-off, placed on furlough, or forced to take pay cuts), and labour market initiatives (loans at subsidised rates to companies and the self-employed in exchange for a no unpaid layoffs condition). Moreover, there are plans to introduce an unemployment insurance programme.
Krista finished her second presentation of the day with a number of policy recommendations focusing on child- and gender-sensitive elements and the inclusion of migrant workers into the mainstream social protection landscape.
The presentations were followed by a lively Q&A session that can be accessed here.
This was the fourth webinar of the Series ''Social Protection in South Asia – the landscape before the Covid-19, and a snapshot into responses to the crisis and the paths ahead'', jointly organised by the IPC-IG, UNICEF Regional Office for South Asia (ROSA), and Country Offices.
Bibliography:
Social spending in South Asia: an overview of government expenditure on health, education and social assistance. Both Research Report and One Pager already available, and a presentation on preliminary findings was delivered as part of webinar 3 of this series.
Overview of non-contributory social protection programmes in South Asia from a child and equity lens. Both Research Report and One Pagers on general findings and child-sensitive analysis are already available, and a presentation on preliminary findings was delivered as part of webinar 1 of this series.
Gender and social protection in South Asia: an assessment of the design of non-contributory programmes. Both Research Report and One Pager already available, and a presentation on preliminary findings was delivered as part of webinar 1 of this series.
Social protection legislative frameworks in South Asia from a child-rights perspective. Forthcoming publication, but a presentation with preliminary findings was delivered as part of webinar 3 of this series.
Evidence linking social protection programmes in South Asia with child poverty, economic growth and improvement in human development. Forthcoming publication, but a presentation with preliminary findings was delivered as part of webinar 3 of this series.
Socio-Economic impacts of COVID-19, policy responses and the missing middle in South Asia. Both Research Report and Executive Summary already available as well as a number of country-specific One Pagers, and a presentation on preliminary findings was delivered as part of webinar 2 of this series.
