Tool for Fiscal Space Analysis When Financing Social Protection

This report presents implementation guidelines that reflect the type of activities that should be undertaken to use the fiscal space tool in the field. They are not intended to be prescriptive nor restrictive. Each ISPA tool application will require an adaptation of these guidelines to fit local circumstances, depending on the needs and availability of data and resources.

Over the years, the development partners have developed methods and procedures to support national dialogue in analysing fiscal space and assessing financing options for social protection. This know-how can be useful for national policymakers because it can guide national estimates and models and support their assessment of their country’s capacity for social protection costing and financing. A write-up of these methods and procedures is the starting point for a fiscal space tool. In view of significant financing gaps that hinder the achievement of universal and adequate social protection,2 countries can request technical assistance in their assessment, costing and financing of social protection. Regularly, development partners and governments have prepared individual approaches to the assessment of fiscal space. Given this, the fiscal space tool is a good idea to integrate multiple perspectives into one method when it gives policymakers a methodology to analyse their country-specific situations.