Publication: Aging and Poverty in Africa and the Role of Social Pensions
Date
2005-01
ISSN
Published
2005-01
Author(s)
Subbarao, Kalanidhi
Abstract
In many low income African countries,
three factors are placing an undue burden on the elderly: 1)
the burden on the elderly has enormously increased with the
increase in mortality of prime age adults due to the
HIV-AIDS pandemic and regional conflicts; 2) the traditional
safety net of the extended family has become ineffective and
unreliable for the elderly; and, 3) in a few countries, the
elderly are called upon to shoulder the responsibility of
the family as they became the principal breadwinners, and
caregivers for young children. While a number of studies
have examined the welfare consequences of these developments
on children, few studies have systematically analyzed the
poverty situation among the elderly (relative to other
groups) in low income countries in Africa, and the role of
social pensions. This study aims to fill this gap. The
findings show much heterogeneity across countries with
respect to the proportion of the elderly population, the
living arrangements, and the composition of households, and
household headship. The analysis shows that the poverty
situation, and especially the poverty gap ratio, for the
household types the "elderly only", the
"elderly with children" and the
"elderly-headed households" is much higher than
the average in several countries, and the differences are
statistically significant. The analysis further shows that
the fiscal cost of providing a universal non-contributory
social pension to all of the elderly will be quite high - 2
percent to 3 percent of GDP, a level comparable to, or even
higher, than the levels of total public spending on health
care in some countries. While categorical targeting of a
pension for the above groups yields the maximum poverty
reduction impacts, and is also fiscally sustainable even in
low income countries, its operational feasibility is
considered to be weak. The study concludes that the case for
a universal approach is weak. The best option appears to be
to target the pension only to the poor among the elderly,
keeping the benefit level low. The study underscores the
need for more country-specific work to explore the
feasibility of the recommended option in diverse country settings.
Citation
“Subbarao, Kalanidhi. 2005. Aging and Poverty in Africa and the Role of Social Pensions. Social Safety Nets Primer Notes; No. 19. © World Bank, Washington, DC. http://openknowledge.worldbank.org/entities/publication/5254c209-790e-56f6-a373-1a0d90800266 License: CC BY 3.0 IGO.”