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Key Text The Future of Social Protection in the Developing World: Actors, Bottlenecks and Politics

Author: Armando Barrientos and David Hulme
Date: 2008
Size: 7 pages (99 KB)

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Summary

This section of a broader paper examines three important factors in the future of social protection: the role of external actors, the bottlenecks of sustainable finance and delivery capacity, and politics. It argues that the role of national governments in formulating and coordinating policies is important, and emphasises the need for political conditions that are conducive both to the initiation of social protection programmes and their sustainability. Donors should prioritise governments' capacity to fund social protection programmes and focus on creating a domestic political constituency to support social protection.

International actors

What roles have international actors played in the rise of social protection?

The ILO has taken the lead in advocating and supporting social protection. It has led a focus on 'decent work' as a framework for extending basic rights to all workers. More recently it has advocated a basic package of social protection measures among low income countries.
The World Bank developed a social protection strategy in the mid 1990s as a response to the impact of structural adjustment on developing countries. It is now a leading funder of social protection activities, but its work is restricted to countries with high debt levels.
The IMF plays an indirect, but highly significant, role in social protection. It plays a key role in ensuring that expenditure on social protection, and donor support, do not damage the macro-economic environment of borrower countries. It is usually viewed as an obstacle to effective social protection.
Various UN agencies are involved in social protection, with their focus varying according to their mandate.
Bilateral donors are increasing their support for social protection.
INGOs have generally been slower to support social protection.

While a wide range of external providers and stakeholders are involved in social protection in developing countries, it is important to remember the important role of national governments in formulating and coordinating policies, and in ensuring that social protection is integrated into national development strategies. Extending social protection involves establishing institutions that reflect and strengthen societal solidarity and cooperation; externally imposed policy transfers are unlikely to achieve these objectives.

Bottlenecks: financing and delivery capacity

Finance is one of the main constraints on the expansion of social protection in low-income countries. An ILO study finds that a basic social assistance package costs about 2-3 percent of GDP, a level which appears affordable for most developing countries. The costs of not providing social protection are considerable. The necessary funds can be raised by: improving the efficiency of tax collection agencies; switching expenditure from poorly performing poverty budget allocations; and increasing aid to establish and sustain social protection programmes. In most low-income countries, some combination of these measures should be pursued.

Delivery capacity limitations are another major challenge to the extension of social protection in low-income countries. These include limitations in the capacity to study, measure and analyse poverty, the capacity to design and implement appropriate policies, and the capacity to deliver and evaluate social protection programmes. Technical assistance from donors should prioritise building capacities in these areas.

Politics

Politics plays a critical role in determining the adoption and implementation of social protection policies. Patronage and corruption undermine the basis for democratically competitive politics and make the political system less effective in aggregating voter preferences. As a result, external intervention from donors can play a crucial role in forcing social protection on to the political agenda. Social protection programmes can quickly build coalitions of support that can ensure their sustainability. Creating a political constituency supporting social protection priorities is essential to securing sustainable social protection.

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Source: Barrientos, A. and Hulme, D., 2008, 'The Future of Social Protection in the Developing World: Actors, Bottlenecks and Politics', in Social Protection for the Poor and Poorest: Reflections on a Quiet Revolution, Brooks World Poverty Institute, Manchester, pp.13-19
Organisation: Brooks World Poverty Institute, http://www.bwpi.manchester.ac.uk/