Social safety net programs positively impact 1.9 billion worldwide, according to a new World Bank report.
Interest in these “non-contributory measures designed to provide regular and predictable support to poor and vulnerable people” is growing, as their effectiveness becomes more widely recognized.
Currently, “an average developing country … has about 20 social safety net programs” and every nation has at least one.
These programs “reduce the poverty gap (how far the poor are from the poverty line) by 15 percent on average of the poverty gap without safety nets,” with “costs [ranging] between 1.5 percent and 1.9 percent of gross domestic product in low- and upper-middle-income countries, respectively,” the report said.
Nevertheless, only “33 percent of the world’s poor receive aid from such programs,” and in the poorest nations “only one-quarter of the poorest quintile are covered by social safety net programs.”
“The coverage gap is particularly acute in Sub-Saharan Africa and South Asia, where most of the global poor live.
In these regions, only one-tenth and one-fifth of the poorest 20 percent have access to social safety nets, respectively,” the report said.
The World Bank identified and analyzed three forms of assistance – in-kind transfers (food stamps and school feeding programs, for example), cash-based transfers (scholarships and poverty-targeted funds, for example) and fee waivers (reductions in medical expenses and social pensions, for example).
Each initiative continues to play a key role in safety net programs, though the growth of cash transfer programs (CTPs) was cited as a leading trend.
CTPs result in many positive consequences: increased school enrollment and attendance, improved medical care and a higher number of live births, greater food security and improved economic conditions.
Current CTP initiatives, however, are inadequate to address global need.
“Transfer amounts represent approximately one-fifth of the income needed to close the poverty gap in low-income countries and half the income needed in lower-middle-income countries. On average, they are adequate to lift a poor person out of poverty only in upper-middle-income countries.”
To close the remaining gaps, it is essential to improve management systems that better identify needs, avoid overlapping programs and increase coordination and oversight in order to provide appropriate assistance in a timely, efficient manner through CTPs and other safety net programs.
The report also highlighted how conflict and climate change continue to have a disproportionate impact on the poor.
Both issues require responses that balance the provision of short-term emergency aid with initiatives to address systemic challenges of “chronic poverty and inequality” and climate-induced disasters.
The full report offering a detailed analysis of the key features, spending rates, central developments, performance indicators and urban area issues regarding social safety net programs is available here.