How Large Are Our Social Safety Nets?

23 May 2014 07:44 pm - 0 - {{hitsCtrl.values.hits}}

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By Sudakshina Ray
The World Bank released its first report of the series on ‘State of Social Safety Nets’ on May 13, 2014. Safety nets are non-contributory government transfers aimed at providing assistance to the socially and economically marginalised sections of the society. Amartya Sen and Jean Dreze in their work ‘India: Development and Participation’ posited the capability approach to freedom as a critique to the Rawlsian concept of equality of opportunity of the generalised citizen. According to them, mere provision of resources and not means to enable citizens to have access to resources is not empowerment, and in typical societies, not all individuals are entitled to free and equal opportunities. Much of a citizen’s access to public and private goods depends on his or her social and economic standing. It is only when resources are backed by the state’s support that citizens are able to access the resources to enhance their capabilities and fulfill their potential. Evoking this concept, social nets promote human capacities and efficiency by undertaking welfare legislation for the provision of essential goods and services like health, education, employment and housing for those who cannot afford them.

However, inequalities are different for different countries and so are the curative policies in place. The World Bank report on ‘State of Social Safety Nets’ found that each country has at least one social safety net programme in place. School feeding is the most common safety net programme in place in almost 130 countries. This finding is also supported by the World Development Report (2014).1 That study signals that nutritional interventions have the largest positive cost-benefit ratios of any measures to decrease risk. So, governments find it beneficial to invest in nutritional lunch programmes as they are the earliest to show beneficial results in the form of better height and weight gain among children, better retention power and have added benefits like higher enrolment rates in schools among others.

The mid-day meal scheme, the school feeding programme of India, targets 113 million and the ‘Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA)’ targets 193 million people.
2 These two are the largest social safety nets in the world

The five largest safety nets are all from populous middle-income countries, and not surprisingly, BRICS countries figure extensively in the list. With a total of 486 million people in the five countries, they cover almost half of the global targeted population. The mid-day meal scheme, the school feeding programme of India, targets 113 million and the ‘Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA)’ targets 193 million people.

2 These two are the largest social safety nets in the world. Adding to that, China’s ‘Di Bao’ (78 million) and the Brazil’s ‘Bolsa Familia’ (52.4 million) are the largest unconditional and conditional cash transfer schemes in the world respectively. 3 Brazil’s another programme, ‘Fome Zero’ or Zero Hunger agenda, initiated in 2003, had brought down the country’s child mortality rate by 13 percentage point besides bringing up 20 million people above the poverty line. Brazil’s school lunch programme is also interesting because of the economic linkages it creates. 30 per cent of each school lunch is sourced from local markets, thus encouraging community participation and thriving of local markets. The success of the programme, providing a social safety net to 53 per cent of the Brazilian poor, has given the Brazilian President Dilma Rousseff a boost in the upcoming presidential elections, scheduled for October later this year. Rousseff has announced a 10 percent increase in the social security transfers with additional tax cuts for the poorest Brazilians.

4 Another BRICS country, South Africa, has the largest programme in the continent in its ‘The Child Support Grant’. South Africa’s scheme is followed by Ethiopia’s ‘Productive Safety Net Programme’, which is largely externally financed.

The Gini Ratio, which measures the rate of inequality in a country, always lies between 0 and 1. The higher the value, more unequal a country is. China, India and Brazil are all highly unequal countries. However, in Brazil the Gini index came down from 0.61 to 0.54, while it went up in both India, from about 0.31 to 0.33, and China, from 0.29 to 0.42 after social safety nets programmes were undertaken.

5 Facing the common challenges of lack of social security, the BRICS nations have proposed to work together, learning from each other’s mistakes and adopting best practices. While, India’s scheme may be the largest in the world, it unfortunately is so only in absolute numbers, covering 18 percent of the population. Effectively, it encompassed only 25.3 percent of the poorest 20 percent.

6 India also spends the second lowest, following only Afghanistan on social safety as a percentage of GDP among the South Asian countries.

(Courtesy: Eurasia Review)

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How Large Are Our Social Safety Nets?

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