Social protection, a key ingredient for socially inclusive transformation

As mentioned in my previous blogs, sudden shocks can have devastating impacts on the livelihoods of both rural and urban communities and can reverse much of the progress made towards achieving the SDGs. Russia’s invasion of Ukraine has led to increased energy prices and reduced grain supply. The price of wheat has risen by 64% since the war began, with the price of natural gas rising by 170%. On top of this the price of Urea fertilizer has seen a 179% surge making it completely unavailable to smaller farmers relying on it for their crops. Rural people simply cannot keep up with the increases in the costs of living and it is impossible for them to achieve the SDGs without support from their governments and social protection packages. The Covid-19 pandemic has highlighted inequalities worldwide and has exposed the inadequacies in social protection systems and has pushed the poorest and even the non-poor into poverty traps.

The pandemic has brought the necessity of social protection into focus. Many countries have ramped up efforts on providing additional social protection programs during the pandemic, but many were short term. Investments need to be maintained and efforts to ensure social protection need to kept up well after the pandemic and beyond to buffer resilience to other possible disasters. The gap in fiscal spending on social protection between developing and developed nations highlights how much investment is needed to ensure social protection for all. In figure 1 below, we can see the financial gap in social protection between different groupings (by country group and income group) from the World Bank. It is estimated by the international labour Organization that 4.1 billion people lack access to any form of social protection (ILO, 2021).

SDG 1 (no poverty) target 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” highlights the need to close the financial gap in social protection which gap alleviate poverty and boost progress towards achieving the rest of the SDGs. Investing in social protection can reduce poverty amongst the poorest, help them build their resilience and allow them to invest in their careers, education, and health. They can be a proactive resilience building mechanism to help the furthest behind maintain a decent level of savings (protect their assets) to buffer them against disastrous events.

The consequences of climate change will have adverse impacts on rural communities and can severely set back any progress made towards development. After a shock, many poor people who do not have any form of social protection or income may have to pull their children out of school or sell their productive assets, this might provide short term relief, but it will leave them even more vulnerable to future strains. Also, from an agricultural perspective, many farmers who anticipate a climate related shock such as a drought will reduce expenditure on inputs, leading to lower yields and decreased earnings from the crop.

Those who are covered by social protection, like many in the developing world will be at an advantage when another economic crisis or pandemic arises, whilst those uncovered will be pushed further into poverty, undoing any efforts they have previously made at enhancing their lives. Another factor only creating a larger divide between the rich and the poor.

Social protection can be a powerful tool to enhance social inclusion and should effectively targeted and reach the most vulnerable and socially excluded groups to have positive impact. For this to happen, much more data is needed on the poor as they are often voiceless with a lack of connection to the state. Understanding the situations of poor people can enlighten the design of social protection policies to deliver effective programs such as cash and food transfers, public works, and labour programs to those in most need.