Informal Social Protection: Social Relations and Cash Transfers
This report examines the interactions between informal and formal social protection. Informal social protection refers to the (cash or in kind) support provided by family and community members to the poor and vulnerable in times of difficulty, whereas formal social protection refers to transfers (cash or in kind) from the state to citizens to help smooth consumption and protect individuals or families from destitution. While informal social protection plays an important role, it does not always support or protect. It tends to exclude certain groups of people or include them on unequal terms. And it is often those with the least resources who are least able to rely on others in times of need.
This report interrogates the common assumption that formal social protection crowds out local systems of support, and finds that this is not usually the case. Evidence suggests that formal social protection is generally additive and may prevent informal systems from breaking down. Where formal social protection does crowd out informal social protection, it is not necessarily negative. It may make the poor and marginalised less dependent on informal social protection relations based on patronage and structural inequality. Indeed, formal social protection can enable poor individuals to build their social capital and increase access to informal social protection networks.
Formal social protection has a unique and increasingly important role to play alongside informal social protection. Formal social protection can address shortcomings in informal social protection because it can distribute resources according to needs, rights, and citizenship, without requiring reciprocation.