Rethinking Economic Inclusion for the Poorest in the COVID-19 Context
Governments are making rapid changes to social protection programmes to confront the economic shocks of COVID-19 for millions of poor households. In partnership with multilateral institutions, NGOs, the private sector, and other development partners, governments have provided social assistance and emergency relief to their most marginalised populations at scale. However, the pandemic and resulting lockdowns will have far-reaching impacts on the global economy and the livelihoods of people living in poverty, which will need to be addressed through more sustainable solutions.
The webinar “Rethinking economic inclusion for the poorest in the COVID-19 context” which took place on 3 September, organized by BRAC and hosted by socialprotection.org, addressed how governments can respond to the adverse impact of the pandemic by building resilience and sustainable livelihoods for people in extreme poverty. Specifically, it focused on how economic inclusion interventions such as the Graduation approach can best be integrated into existing responses to serve the needs of marginalised populations like informal workers, newly poor households, and urban migrants.
Lauren Whitehead, Director of Technical Assistance at BRAC Ultra-Poor Graduation Initiative, moderated the webinar and presented evidence on the resilience-building function of the Graduation approach both in key interventions of the approach ex-ante as well as its use as a response to the economic damage to livelihoods caused by COVID-19.
The presenters were:
● Shagun Sabarwal, Director of Policy, Training and Communications, J-PAL South Asia
● Rahma Ali, Senior Research Associate, J-PAL Middle East and North Africa
The discussants were:
● Alex Avila, Assistant Secretary for Labor Relations, Social Protection and Policy Support Cluster, Department of Labor and Employment, Government of the Philippines
● Dalitso Kalimba, Deputy Director, Department of Economic Planning and Development, Government of Malawi
● Vincent Gahamanyi, Social Policy Specialist, UNICEF Rwanda
You can view the presentation slides here and watch the recording here.
Building the resilience of the poor through Graduation in the post-COVID-19 global context - Lauren Whitehead
“70 to 100 million more people are expected to enter extreme poverty by the end of 2020, and the ILO estimates workers in low-income countries will experience a 16% decline in hours worked.” - Lauren Whitehead
The webinar began with the moderator, Lauren Whitehead, describing the magnitude of the impact COVID-19 has had on the livelihoods of extreme poor households worldwide. In particular, poor people in urban areas have been disproportionately harmed by COVID-19 and are increasingly reverse migrating to rural areas due to job loss and health consequences of the pandemic. The severity of these economic shocks presents an opportunity for governments to reinvigorate their policy responses and apply a resilience lens to economic inclusion and recovery.
The Graduation approach is one promising intervention that provides a pathway for extremely poor households to recover economically and prepare for future shocks. It helps participants increase their resilience by enhancing their technical capabilities, encouraging asset diversification, increasing savings, and introducing market-driven sustainable livelihoods. These resilience-building features of the approach derive from its four pillars, which are depicted below:
● Social protection, providing a foundation of social assistance to meet basic needs such as food security, shelter, health services, and education for children
● Livelihoods promotion, helping participants develop sustainable income-generating enterprises or formal employment
● Social empowerment, promoting social inclusion in participants’ communities
● Financial inclusion, improving financial literacy and supporting saving activities
Lauren presented examples of Graduation building economic resilience during COVID-19 in Bangladesh and the Philippines, citing that 95% of Graduation participants in Bangladesh were still engaged in income-generating activities as of June 2020 while 89% of participants in the Philippines kept their assets during quarantine. She then addressed how stakeholders can advance Graduation as a pathway to economic recovery through the following steps:
- Solidifying government commitments to allocate resources for holistic social assistance.
- Supporting governments of varying resources with approaches tailored to local contexts.
- Leveraging momentum in social protection during COVID-19 to cement strengthened systems and inter-ministerial collaboration after the pandemic.
- Reassessing Graduation programme designs accounting for disrupted markets and needs for adaptive livelihoods.
- Advocating with multilateral partners for shock-responsive social protection programmes that integrate economic inclusion at the outset.
Ensuring economic inclusion in India’s COVID-19 response - Shagun Sabarwal
Shagun Sabarwal’s presentation addressed the challenges and implications of government social protection responses in the Indian state of Bihar, covering local research on the impacts of COVID-19 on government-led Graduation and other economic inclusion programming.
Economists predict that the Indian economy will take at least four years to return to pre-pandemic levels of economic growth, while the Government has taken measures to expand social protection with a $266 billion relief package. Although government-to-person (G2P) payments have scaled during the crisis, the Government has struggled to reach the most vulnerable populations with social assistance. In Bihar, the Graduation approach has improved identification and targeting of marginalised groups like these for social protection.
The Satat Jeevikoparjan Yojana (SJY) scheme, a Graduation intervention launched by the State Government of Bihar in 2018, provided a database the government used to send cash transfers and conduct telephone surveys with participant households in extreme poverty. The survey found the majority of participants were aware of COVID-19 and had received information from government services, though 39% were unable to recall any symptoms. The intervention has successfully reached 39,000 people so far, providing insights on how the Indian government might improve social protection systems with evidence-based insights from Graduation such as the efficacy of community-based targeting and self-targeting for extremely poor households as opposed to the current model of location-based targeting.
Status of the ultra-poor in rural Egypt during the COVID-19 pandemic - Rahma Ali
Rahma Ali presented recent research from the Bab Amal Graduation pilot in Egypt and shared how COVID-19 has impacted participants’ livelihoods, food security, and women’s labor force participation. With 74% of Egyptian families seeing incomes decline and 56% working fewer hours, the impact of COVID-19 on local livelihoods has been drastic.
A May 2020 survey of 840 households participating in the Bab Amal Graduation pilot found that 26% of households were able to generate revenue from their assets, which included livestock assets for 80% of the sample and non-livestock (often petty trade) assets for the remaining 20%. Many of the households had received these livestock assets as recently as three months before the survey, and were ready for sale. Similarly, households with non-livestock assets suffered from a lack of supply as well as lowered demand. About half of the livestock households and 42% of non-livestock households had borrowed from their savings to spend on food and mitigate health shocks. These findings have significant implications for sequencing and timing of interventions such as asset transfers in future government economic inclusion programmes using Graduation to build resilience. Further research will be conducted as the programme progresses during COVID-19.
Discussion
Discussants from the Governments of the Philippines and Malawi, and UNICEF Rwanda addressed key questions around the research findings from India and Egypt and provided government perspectives on how they are addressing challenges in economic inclusion for people in extreme poverty during the pandemic. Assistant Secretary Alex Avila began by answering a question on how the Department of Labor and Employment (DOLE) in Negros Occidental has responded to how DOLE is supporting the large population of overseas Filipino workers returning unemployed to the country due to coronavirus lockdowns. Mr. Avila stated that 3.39 million Filipino workers were in the process of returning home from work abroad while the domestic economy was already facing high unemployment and strict lockdowns. DOLE is attempting to integrate returning workers through reintegration programmes for economic inclusion that include COVID-19 testing, transportation, emergency employment guarantees, and digital surveying techniques. Additionally, DOLE hopes to adapt lessons from its Graduation pilot to a livelihood programme for returning foreign workers after seeing two-thirds of domestic Graduation participants continuing to generate incomes during lockdown.
Deputy Director Dalitso Kalimba responded to the question of how to help extremely poor populations in urban contexts during COVID-19. The Government of Malawi launched a cash transfer intervention targeting urban populations, who have suffered due to the high unemployment rates caused by the economic shocks of the pandemic. The Government has found that a coordinated response across government agencies and partners, addressing the multidimensional needs of extremely poor populations, and creating linkages between social protection interventions, is essential to success. Mr. Kalimba also noted that the Graduation programme in Malawi has had difficulty delivering services and convening savings groups for participants, but that the pandemic has also led the programme to adapt its selection of assets and value chains.
Lastly, Mr. Vincent Gahamanyi was asked how UNICEF Rwanda has responded to COVID-19 in terms of social protection and economic inclusion interventions. He noted that while Rwanda’s social protection programmes have become more comprehensive since 2018, they needed to adapt to the economic restrictions caused by the pandemic. The government meets with development partners regularly to expand social protection both vertically and horizontally, providing for a greater variety of basic needs and reaching more vulnerable groups. Mr. Gahamanyi called attention to the function of Graduation as complementary to existing social assistance programmes like the government’s Vision 2020 Umurenge Programme (VUP) which provides cash transfers, public works, and other support, highlighting that while emergency pandemic responses have kept poor people at a subsistence level, they need a holistic economic inclusion intervention to go beyond that.
The webinar then concluded with an engaging Q&A session linked here.
