Universal Social Protection Floors: Costing Estimates and Affordability in 57 Lower Income Countries

The strong positive impacts of social protection have brought social protection to the forefront of the development agenda. Social protection is a key element of national development strategies to reduce poverty and inequality, promote human capital, political stability, and inclusive growth.

The Social Protection Floors Recommendation (No. 202), adopted in 2012, reflects a global consensus on the extension of social security reached among governments, employers’, and workers’ organizations from 185 countries at all levels of development (ILO, 2012 and ILO, 2017b). In adopting Recommendation No. 202, countries committed to build nationally-defined social protection floors as the fundamental element of their social protection systems, aiming at universal protection, for all.

 

SDG Target 1.3 and Indicator 1.3.1

Target 1.3: Implement nationally appropriate social protection systems and measures for all, including floors, and by 2030 achieve substantial coverage of the poor and the vulnerable

Indicator 1.3.1: Proportion of population covered by social protection floors/systems, by sex, distinguishing children, unemployed persons, older persons, persons with disabilities, pregnant women, newborns, work-injury victims and the poor and the vulnerable

Furthermore, the roll-out of social protection floors has been endorsed by the G20, and is part of the United Nations Sustainable Development Goals (SDGs), adopted by all countries in 2015, committing states to expand social protection systems and measures for all, including floors, by 2030 (SDG target 1.3). 1

More than thirty developing countries have taken-up the commitment and have already made the vision of a world with universal social protection schemes a reality, such as Argentina, the Plurinational State of Bolivia, Botswana, Brazil, Cabo Verde, Chile, China, Kazakhstan, Kiribati, Kosovo, Kyrgyzstan, Lesotho, Maldives, Mauritius, Mongolia, Namibia, Seychelles, South Africa, Swaziland, Thailand, Timor-Leste, Trinidad and Tobago, Uruguay, Uzbekistan, and Zanzibar (United Republic of Tanzania). Some of them have achieved universality through a mix of contributory social insurance and non-contributory benefits, and others have achieved universality by universal transfers, such as the Plurinational State of Bolivia, Botswana, Lesotho, Mongolia, Namibia, Swaziland or Zanzibar (United Republic of Tanzania), showing that there are several ways to achieve universality (Global Partnership for Universal Social Protection, 2016a–i; ILO 2017a).

The world is united in the advancement of universal social protection. Strengthening social protection systems, including floors, is supported through the joint efforts of the United Nations agencies at different levels, and through concerted joint efforts with relevant international, regional, subregional and national institutions and social partners, including the Global Partnership for Universal Social Protection.

While the need for social protection is widely recognized, the human right to social security remains unfulfilled for the large majority of the world’s population. Only 29 per cent of the global population enjoy access to comprehensive social protection systems, meaning that they have access to all areas of social protection, from child benefits to old-age pensions,

1 Social protection also contributes to attaining several other goals, including the goals on health (particularly target 3.8), gender equality (particularly target 5.4), decent work and economic growth (particularly target 8.5) and equality (particularly target 10.4).

Universal social protection floors: Costing estimates and affordability in 57 lower income countries 1

 

whereas 71 per cent are covered partially or not at all (ILO, 2017a). Most of the population adequately covered by comprehensive social protection systems live in high-income countries.

In 2015, the percentage of the global population effectively covered by at least one social protection benefit (or SDG Indicator 1.3.1.) stands at only 45 per cent, which means that more than half of the global population are not effectively protected in any area of social protection. Social protection coverage for children is still insufficient: only one in three children (35 per cent) are covered, pointing to significant underinvestment in children and families, mostly in developing countries. Only 41 per cent of women with newborns receive maternity cash benefits that provide them with income security during the critical period. Large coverage gaps exist also for persons with severe disabilities: worldwide, only 28 per cent receive disability benefits. Effective pension coverage for older persons stands at 68 per cent of all persons above retirement age worldwide (ILO, 2017a). Despite significant progress in the extension of social protection coverage, many are left unprotected; thus renewed efforts are needed to realize the human right to social security and achieve the SDGs.

This paper explores the costs and affordability of non-contributory social protection floors in developing countries, showing that it is feasible even for countries with large vulnerable populations.

The lack of access to social protection constitutes a major obstacle to economic and social development. Inadequate or absent social protection coverage is associated with high and persistent levels of poverty and economic insecurity, growing levels of inequality, insufficient investments in human capital and human capabilities, and weak aggregate demand in a time of recession and slow growth. Further, lack of social protection is associated with political instability, higher crime rates and terrorism (ILO, 2014a).