Social protection, in particular social assistance, has been one of the most important short-term measures deployed by governments to buffer their populations against the immediate impacts of COVID-19. But with the spectre of “L-shaped” recessions looming, experts from the FCDO- and GDC-funded SPACE initiative – Edward Archibald and Laura Alfers – discuss the ongoing need for investment in social protection in the medium to long term. Both for continuing to meet people’s immediate needs and for ensuring preparedness against an increased intensity and frequency of compound shocks.
The global numbers appear impressive (Gentilini et al., 2020): 200 countries/territories have responded to the pandemic by planning or introducing over 1000 new social protection measures, covering over a billion people. This is in addition to the vital support also provided by pre-existing social protection programmes and humanitarian actors.
The purpose of such measures has been to protect poor and vulnerable people from the possible negative implications of the pandemic. There is still much we do not know about the effectiveness or efficiency of these measures… Who was included or excluded, and why? Were transfer levels generous enough to have the intended impacts? The answers to these and other questions are important for understanding the nuance behind the big headlines.
But it is also important for governments and development partners to start thinking ahead to the next phase of the pandemic, and what this means for social protection.
Implications of an impending and prolonged recession
COVID-19 has triggered a global economic slowdown. One (not unlikely) scenario is that a steep decline in any economy is not matched by a steep recovery, and that growth does not recover for several years. When this type of economic performance is plotted on a graph, the shape resembles the letter L – hence the term “L-shaped recession”. Although we do not yet know which scenario will play out, we can be confident there will be prolonged and devastating impacts for hundreds of millions of poor and vulnerable people in developing countries.
Government budgets are already stretched thin, with limited prospects for generating revenue given the already reduced economic activity, and many countries affected by high levels of sovereign debt. The bilateral aid programmes of donor governments will also be impacted by shrinking economies and domestic spending pressures.
In parallel, we can expect to see an increasing intensity and frequency of natural shocks, together with ongoing mega trends such as climate change, conflicts, demographic bulges, and migration. This will likely create a scenario of multiple colliding shocks and stressors (Roelen et al 2020).
The global projections across many development indicators are exceptionally bleak, for example:
- Twenty years’ worth of development gains in African countries are at risk (Henstridge and Lee, 2020);
- An additional 10,000 children could die each month from wasting during the first year of the pandemic (Fore et al., 2020);
- Up to 100 million people will fall into monetary poverty (Mahler et al., 2020).
Recessions will not hit equally. Sectors and livelihood groups will be impacted differently, as will men and women, the old and young, the able-bodied and those with disabilities, minority groups, those with citizenship status in the countries in which they work, and those without. The pandemic is both exacerbating pre-existing vulnerabilities and creating new vulnerabilities (Devereux et al., 2020).
What does all this mean for the role of social protection during a prolonged recession?
Clearly, the needs for social protection are more intense and diverse than ever. But just doing more of the same will not be enough. To understand how social protection can help governments and households as their economies enter recession, we also need to learn from the past. This means addressing the lessons from both before and after the onset of COVID-19. Trade-offs will be required, but social protection can help navigate the recession.
Over the medium-term – say from now until end 2022 – governments should prioritise addressing immediate social protection needs while also “building back better” by focusing on long-term systems. Immediate needs will continue to be important. But one of the single most important insights from the pandemic is that responses were more efficient and effective in contexts where governments had invested in preparedness (SPACE, 2020). Those countries which had prepared their social protection systems to respond to shocks have navigated the turbulent seas more smoothly over recent months.
Looking ahead, this means governments shifting from firefighting each individual shock to understanding current and future risks – and enhancing social protection systems and coverage levels accordingly. This requires attention across a raft of issues, including governance, institutional coordination, administrative structures and capacities, and delivery systems, together with sustained political will to deliver the necessary fiscal space.
10 recommendations for policy makers and those that influence them
The pandemic is an opportunity for social protection reform, although governments will of course need to consider competing urgent priorities. There will be compromises in light of fiscal space, political economy, capacity constraints and the maturity of social protection systems.
Based on what we know about social protection both before and after the onset of COVID-19 (including through advice provided by SPACE to over 30 countries), and the likely implications of a prolonged recession, we have identified 10 priority areas for consideration and action over the medium term:
- Increase social protection coverage to include both pre-existing and newly poor and vulnerable populations. Creating a broader base of potential beneficiaries will also allow the social protection system to expand and contract in response to future crises. Broadening the proportion of citizens and workers who benefit from social protection can also strengthen (or help establish) the social contract. Social insurance coverage should also be strengthened, including through progressive formalisation of informal workers.
- Improve the adequacy of social assistance, through tailoring the size and duration of transfers to individual and household needs. These will evolve and change over time, with adjustments to be made accordingly.
- Identify and address multidimensional needs, particularly those emerging from the impacts of COVID-19. Social protection systems can support citizens with needs such as mental health, (Bartuska and Marques, 2020), gender-based violence, (UNDP, 2020), and education and childcare through better linkages with services (SPACE, 2020). A holistic package of interventions (Gates Foundation, 2020) can support the re-establishment of livelihoods and decent jobs in both the informal (SPACE, 2020) and formal economies, and across urban and rural contexts.
- Consider the disproportionate effect of the pandemic on women and girls across their life course and vulnerable groups (people with disabilities, older people (Juergens and Galvani, SPACE, 2020) etc.) in all future programming. Further guidance is available through SPACE’s note on gender and social inclusion (SPACE, 2020).
- Invest in developing stronger ‘building blocks’ for delivery, which will reduce delays and improve predictability and timeliness when responding to multiple and overlapping shocks. This can also be done by leveraging learning and systems from the humanitarian and Disaster Risk Management sectors, incorporating a focus on the shocks, risks, and stressors your country typically faces. An excellent source for practical step-by-step guidance and learning materials on shock responsive social protection has been created by TRANSFORM (see Section 3 especially) (TRANSFORM, 2020). Particular attention should be paid to investing in delivery systems, including information systems and mechanisms for targeting (registration, eligibility determination, and enrolment), and accessible payment systems. For further guidance see SPACE guidance notes on preparedness (SPACE, 2020), registration (Barca et al., SPACE, 2020), and payments (SPACE, 2020). The broader ‘ecosystem’, such as national identification and Civil Registration and Vital Statistics systems, can also be strengthened and leveraged.
- Invest in capacity strengthening to ensure effective delivery systems – this extends beyond the public sector. The potential roles of local actors (SPACE, 2020) (including national and sub-national entities – civil society organisations, government, private sector actors, and communities themselves) in strengthening a social protection system should always be considered – as well as the roles that could be played by humanitarian counterparts (SPACE, 2020).
- Strengthen accountability, drawing upon the wealth of local expertise. More emphasis is needed on accountability in both routine programmes and on a rapid and wide scale in response to future shocks. Support from humanitarian actors, in line with the Humanitarian Principles (OCHA, 2012), could also be critical, and can support parallel efforts to combine humanitarian and social protection systems (SPACE, 2020) where it makes sense to do so.
- Incorporate climate considerations explicitly into social protection systems. This involves considering the extent to which social protection can adapt to climate shocks (e.g. strengthen people’s capacity to withstand extreme shocks without external financial assistance) and mitigate the risks in the face of changing climates and weather patterns (e.g. improving the capacity of beneficiaries to provide food and nutrition for their families) (Roelen et al, 2020).
- Strengthen national ownership of social protection through a more comprehensive and joined-up/coordinated approach. This means coherence across sectors (including social protection and humanitarian response), within social protection (social insurance, social assistance, labour markets), and within individual components of social protection (e.g. within social assistance). Multi-sectoral coordination will be important to this coherence, including robust collaboration with humanitarian Cash Working Groups.
- Identify new sources of finance for strengthened investment in routine social protection, as well as for responding to increased needs generated by future shocks. Expanded domestic revenue mobilisation efforts (Ortiz et al., 2019) should ideally be used to generate new resources, although it is recognised that the prospects of this over the medium term are slim – particularly in most low- to middle-income contexts. It is also critical to ensure that current financing is maintained in the face of intensified competition for limited funds. Robust evidence on the impact of social protection and unmet needs can be used to advocate for protecting existing financing and securing additional resources. A stronger approach to disaster risk financing (Poole et al., 2020) can also play a vital role both in advance of and in response to shocks.
List of References
Barca, V. et al. (2020). Preparing for future shocks: Priority actions for social protection practitioners in the wake of Covid-19, Accessible: https://socialprotection.org/discover/publications/space-preparing-future-shocks-priority-actions-social-protection-practitioners
Barca, V. et al. (2020). Options for rapid expansion of social assistance caseloads for Covid-19 responses, SPACE, Accessible: https://socialprotection.org/discover/publications/space-guidance-note-rapid-expansion-social-protection-caseloads
Beazley, R. et al. (2020). Options for rapid delivery (payment of cash transfers for Covid-19 responses and beyond, SPACE, Accessible: https://socialprotection.org/discover/publications/space-options-rapid-delivery-payment-cash-transfers-covid-19-responses-and
Barca, V. et al. (2020). Preparing for future shocks: Priority actions for social protection practitioners in the wake of Covid-19, SPACE, Accessible: https://socialprotection.org/discover/publications/space-preparing-future-shocks-priority-actions-social-protection-practitioners
Bartuska, A. and Marques, L. (2020). "Mental health and Covid-19 in developing countries", OECD Development Matters, Accessible: https://oecd-development-matters.org/2020/08/04/mental-health-and-covid-19-in-developing-countries/
Devereux, S. et al. (2020). "Covid-19 and social protection needs: who are the most vulnerable?”, Institute of Development Studies (IDS) Opinions, Accessible: https://www.ids.ac.uk/opinions/covid-19-and-social-protection-needs-who-...
Fore, H. et al. (2020). "Child malnutrition and Covid-19: the time to act is now”, The Lancet, vol. 396, Issue 10250, Accessible: https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)31648-2/fulltext
Gentilini, U. et al. (2020). Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures, Washington, D.C.: World Bank Group, Accessible: http://documents1.worldbank.org/curated/en/454671594649637530/pdf/Social-Protection-and-Jobs-Responses-to-COVID-19-A-Real-Time-Review-of-Country-Measures-July-10-2020.pdf
Henstridge, M. and Lee, S. (2020). “How bad is the impact of the pandemic on low-income countries? How long will it last? And what can be done to accelerate recovery?”, Oxford Policy Management Blogs, Accessible: https://www.opml.co.uk/blog/after-the-pandemic-the-economic-impact-on-low-income-countries-and-what-can-be-done
Mahler, D. et al. (2020). “Updated estimates of the impact of Covid-19 on global poverty”, World Bank Blogs, Accessible: https://blogs.worldbank.org/opendata/updated-estimates-impact-covid-19-global-poverty
McLean, C. et al. (2020) Programming Options: 'Cash Plus' approaches in the response to Covid-19, SPACE, Accessible: https://socialprotection.org/discover/publications/space-programming-options-%E2%80%98cash-plus%E2%80%99-approaches-response-covid-19
Gates Foundation (2020). Ideas, Accessible: https://ww2.gatesfoundation.org/Ideas
Alfers, L. et al. (2020). Informal Workers and Social Protection, SPACE, Accessible: https://socialprotection.org/discover/publications/space-informal-workers-and-social-protection
Juergens, F. and Galvani, F. (2020). Social protection for older people during Covid-19 and beyond, SPACE, Accessible: https://socialprotection.org/discover/publications/space-social-protection-older-people-during-covid-19-and-beyond
Holmes, R. et al. (2020). Gender and inclusion in social protection responses during Covid-19, SPACE, Accessible: https://socialprotection.org/discover/publications/gender-and-inclusion-social-protection-responses-during-covid-19
Longhurst, D. et al. (2020). Identifying practical options for linking humanitarian assistance and social protection in the Covid-19 response, SPACE, Accessible: https://socialprotection.org/discover/publications/space-identifying-practical-options-linking-humanitarian-assistance-and-social
Ortiz, I. et al. (2019). Fiscal space for social protection. A handbook for assessing financing options, International Labour Organization, Accessible: https://www.ilo.org/secsoc/information-resources/publications-and-tools/books-and-reports/WCMS_727261/lang--en/index.htm
Poole, L. et al. (2020). The future of crisis financing: a call to action, Centre for Disaster Protection, Accessible: https://www.disasterprotection.org/crisisfinance
Roelen, K., Lind, J. and Sabates-Wheeler, R. 2020. “Social Protection and Building Back Better: A Policy Paper for the Department of Foreign Affairs (DFA), Ireland.”
TRANSFORM (2020). Shock Responsive Social Protection – Manual for Leadership and Transformation Curriculum on Building and Managing Social Protection Floors in Africa, Accessible: https://socialprotection.org/discover/publications/transform-full-document-srsp
UNDP (2020). UNDP Brief: Gender-based violence and Covid-19, United Nations Development Programme, Accessible: https://www.undp.org/content/undp/en/home/librarypage/womens-empowerment/gender-based-violence-and-covid-19.html
United Nations Office for the Coordination of Humanitarian Affairs (UN OCHA) (2012). Humanitarian Principles, OCHA on Message, Accessible: https://reliefweb.int/sites/reliefweb.int/files/resources/oom-humanitarianprinciples-eng-june12.pdf
Venton, et al. (2020). Programming Guidance: Embedding localisation in the response to Covid-19, SPACE, Accessible: https://socialprotection.org/discover/publications/programming-guidance-embedding-localisation-response-covid-19
This blog is part of the blog series ‘Social Protection Approaches to COVID-19’ from Social Protection Approaches to COVID-19: Expert Advice (SPACE). It is funded by the UK Foreign, Commonwealth and Development Office (FCDO) and German Development Cooperation (GDC). SPACE is managed by DAI Europe Ltd contracted through the FCDO framework agreement EACDS Lot B service ‘Strengthening resilience and response to crises’, and the technical advice is provided by independent consultants contracted by FCDO, GIZ and other partners.