Publication: Where is the Money Coming From? Ten Stylized Facts on Financing Social Protection Responses to COVID-19
Loading...
Date
2020-11
ISSN
Published
2020-11
Author(s)
Editor(s)
Abstract
The unprecedented and ongoing scale-up of social protection responses to the COVID-19 pandemic dwarf the response to the Great Recession. But how are countries financing such scale-up efforts? This note lays out ten stylized findings from a rapid review of social protection financing sources in thirty-one countries, including in terms of composition between external and domestic resources, and specific modalities within each.
Link to Data Set
Citation
“Almenfi, Mohamed; Breton, Melvin; Dale, Pamela; Gentilini, Ugo; Pick, Alexendar; Richardson, Dominic. 2020. Where is the Money Coming From? Ten Stylized Facts on Financing Social Protection Responses to COVID-19. Social Protection and Jobs Policy and Technical Note;No. 23. © World Bank. http://hdl.handle.net/10986/34802 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Social Protection and Jobs Responses to COVID-19(World Bank, Washington, DC, 2020-04-17)Some key finds from this "living paper" include : As of April 23, 2020, a total of 151 countries (18 more since last week) have planned, introduced or adapted 684 social protection measures in response to COVID-19 (Coronavirus). This is a ten-fold increase in measures since the first edition of this living paper (March 20). New countries include Angola, Anguilla, Antigua and Barbuda, Aruba, Azerbaijan, Bahamas, Belarus, Bermuda, Brunei, Chad, Grenada, Libya, Montserrat, Nigeria, Saint Vincent and the Grenadines, Seychelles, St Maarten, and UAE. Social assistance transfers are the most widely used class of interventions (60 percent of global responses, or 412 measures). These are complemented by significant action in social insurance and labor market-related measures (supply-side measures). Among safety nets, cash transfer programs remain the most widely used safety net intervention by governments (table 1 and figure 2). Overall, cash transfers include 222 COVID-related measures representing one-third (32.4 percent) of total COVID-related social protection programs. Cash transfers include a mix of both new and pre-existing programs of various duration and generosity. About half (47 percent) of cash transfers are new programs in 78 countries (reaching 512.6 million people), while one-fifth (22 percent) of measures are one-off payments. The average duration of transfers is 2.9 months. The size of transfers is relatively generous, or one-fifth (22 percent) of monthly GDP per capita in respective countries. On average, this is an increase of 86.6 percent compared to average pre-COVID transfer levels (where data is available for a subset of countries).Publication Social Protection and Jobs Responses to COVID-19(Washington, DC: World Bank, 2022-02-07)As of January 2022, a total of 3,856 social protection and labor measures were planned or implemented by 223 economies. This constitutes a net increase of 523 measures, or 15.6 percent since the last update in May 2021. While noteworthy, such increase is the lowest among net additions observed over previous semesters. In fact, the global pace of measures’ introduction over January 2020-January 2022 has been slowing down. This report focuses on the real-time review of country measures in terms of social protection and job responses to Coronavirus (COVID-19).Publication Early Lessons from Social Protection and Jobs Response to COVID-19 in Middle East and North Africa Countries(World Bank, Washington, DC, 2021-12)Countries in the Middle East and North Africa region quickly introduced measures to limit the spread of COVID-19 following the first confirmed cases. These measures included curfews, lockdowns, and social distancing. As a result of COVID-19 induced impacts, countries in the region adopted social protection measures to mitigate the human and economic impacts of the pandemic. But most of the countries in MENA were already experiencing poor macroeconomics brought on by the decline in oil prices and by fragility, conflict, and violence. Illness and loss of income due to the pandemic (largely from informal sources) exacerbated the extreme vulnerability faced by the poor and vulnerable groups. Social protection programs, and particularly social safety nets (SSNs), can help households absorb short-term consumption risk during periods of crisis and build resilience to manage future shocks. In MENA, 21 countries and territories formally announced social protection measures to cope with the impacts of COVID-19. According to a Word Bank real-time review of social protection and jobs responses to COVID-19 (updated May 2021), measures in MENA have spanned social assistance, social insurance, and labor markets programs. Social assistance measures accounted for 59 percent of overall response, whereas social insurance and labor markets made up 23 and 18 percent, respectively. Since the World Bank launched its COVID-19 response, Social Protection and Jobs (SPJ) support to MENA countries has been fast, flexible, and adaptive. The number of Bank-supported social safety net beneficiaries increased from 2 million to 16 million in just 1.5 years of response which demonstrates that social protection systems in MENA are scalable and that country systems and programs are flexible to facilitate this scalability. Early lessons suggest the World Bank significantly contributed to addressing financing, knowledge, and delivery needs based on existing lending and policy dialogue platforms, drawing on the experience in MENA as well as global learning. But lessons also suggest that social protection policy dialogue in MENA is even more important moving forward, to help countries strengthen and boost policy reforms and to design and implement social protection programs and systems that can adequately, effectively, and efficiently target the poor and vulnerable, and be able to respond to population needs during disasters and shocks. This paper provides a documentation of the context for SPJ COVID19 response in MENA countries’, a framework for continued response and some of the early lessons learned.Publication Tracking Global Social Protection Responses to Inflation(World Bank, Washington, DC, 2023-06-30)Between December 2022 and May 2023, the number of social protection and other related measures announced or implemented in response to inflation rose by about 31%. The latest tally includes 1,333 responses across 178 economies. Overall, subsidies claim 33% of such measures and take four main forms (fuel, food, fertilizers, and various fee subsidies). Social assistance accounts for 31% of responses, 77% of which is provided in the form of cash transfers. Tax measures represent 19% of the global responses, and trade, active labor market policies and social insurance claim a share of 6% each. Based on planned coverage data from 116 economies, social protection programs intend to cover 1.94 billion people or about 25% of the world’s population. But so far, actual coverage shows that 303.5 million individuals, or about 4% of the global population, were reached (based on data from 36 economies). Next, based on expenditure data from 561 programs across 143 economies, a total of $1.01 trillion is being invested in social protection responses. This involves an average country spending of 1.06% of GDP. The average size of both social assistance and subsidy transfers represents slightly over a quarter (i.e., 27%) of the daily median income, while their average initial duration is 7.3 months. Almost one-fifth of the responses to inflation have been extended, and the average duration of such extensions is 8.5 months. Over half of social assistance transfers are new (56%) and are provided on a one-off basis (47%).Publication Social Protection Response to the COVID-19 Crisis in the Dominican Republic(World Bank, Washington, DC, 2021-01)The Government of the Dominican Republic (DR) adopted a series of economic and social measures to protect households and businesses and prevent employment losses as a response to the Coronavirus disease SARS-CoV-2 (COVID-19) health and economic crisis. Social protection policies and programs have been used globally as effective mechanisms to respond to the economic crisis due to the COVID-19 pandemic. This policy note aims to document and analyze the design and implementation of the three main cash-transfer programs that the government used to protect households and workers affected by the COVID-19 crisis. The programs that are part of the scope of the note are: (1) stay at home (quédate en casa, QEC), (2) the employee solidarity assistance fund (fondo de asistencia solidaria del empleado, FASE), and (3) the independent worker assistance program (programa de asistencia al trabajador independiente, PA’ TI). The analysis of these programs is based on a desk review of administrative and legal documents, media information, program reports, and operational rules. The policy note is organized as follows: first, it provides an overview of the impact of COVID-19 on the economy and identifies the potentially affected population. Second, it provides a description of the design and implementation of the three social protection programs and their expenditures. Finally, it discusses lessons learned, including challenges and opportunities to improve social protection policies, based on an adaptative social protection framework.
Users also downloaded
Showing related downloaded files
Publication Business Ready 2024(Washington, DC: World Bank, 2024-10-03)Business Ready (B-READY) is a new World Bank Group corporate flagship report that evaluates the business and investment climate worldwide. It replaces and improves upon the Doing Business project. B-READY provides a comprehensive data set and description of the factors that strengthen the private sector, not only by advancing the interests of individual firms but also by elevating the interests of workers, consumers, potential new enterprises, and the natural environment. This 2024 report introduces a new analytical framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency. The analysis centers on 10 topics essential for private sector development that correspond to various stages of the life cycle of a firm. The report also offers insights into three cross-cutting themes that are relevant for modern economies: digital adoption, environmental sustainability, and gender. B-READY draws on a robust data collection process that includes specially tailored expert questionnaires and firm-level surveys. The 2024 report, which covers 50 economies, serves as the first in a series that will expand in geographical coverage and refine its methodology over time, supporting reform advocacy, policy guidance, and further analysis and research.Publication World Development Report 2024(Washington, DC: World Bank, 2024-08-01)Middle-income countries are in a race against time. Many of them have done well since the 1990s to escape low-income levels and eradicate extreme poverty, leading to the perception that the last three decades have been great for development. But the ambition of the more than 100 economies with incomes per capita between US$1,100 and US$14,000 is to reach high-income status within the next generation. When assessed against this goal, their record is discouraging. Since the 1970s, income per capita in the median middle-income country has stagnated at less than a tenth of the US level. With aging populations, growing protectionism, and escalating pressures to speed up the energy transition, today’s middle-income economies face ever more daunting odds. To become advanced economies despite the growing headwinds, they will have to make miracles. Drawing on the development experience and advances in economic analysis since the 1950s, World Development Report 2024 identifies pathways for developing economies to avoid the “middle-income trap.” It points to the need for not one but two transitions for those at the middle-income level: the first from investment to infusion and the second from infusion to innovation. Governments in lower-middle-income countries must drop the habit of repeating the same investment-driven strategies and work instead to infuse modern technologies and successful business processes from around the world into their economies. This requires reshaping large swaths of those economies into globally competitive suppliers of goods and services. Upper-middle-income countries that have mastered infusion can accelerate the shift to innovation—not just borrowing ideas from the global frontiers of technology but also beginning to push the frontiers outward. This requires restructuring enterprise, work, and energy use once again, with an even greater emphasis on economic freedom, social mobility, and political contestability. Neither transition is automatic. The handful of economies that made speedy transitions from middle- to high-income status have encouraged enterprise by disciplining powerful incumbents, developed talent by rewarding merit, and capitalized on crises to alter policies and institutions that no longer suit the purposes they were once designed to serve. Today’s middle-income countries will have to do the same.Publication World Bank Annual Report 2024(Washington, DC: World Bank, 2024-10-25)This annual report, which covers the period from July 1, 2023, to June 30, 2024, has been prepared by the Executive Directors of both the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA)—collectively known as the World Bank—in accordance with the respective bylaws of the two institutions. Ajay Banga, President of the World Bank Group and Chairman of the Board of Executive Directors, has submitted this report, together with the accompanying administrative budgets and audited financial statements, to the Board of Governors.Publication Global Economic Prospects, January 2025(Washington, DC: World Bank, 2025-01-16)Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.Publication Global Economic Prospects, June 2025(Washington, DC: World Bank, 2025-06-10)The global economy is facing another substantial headwind, emanating largely from an increase in trade tensions and heightened global policy uncertainty. For emerging market and developing economies (EMDEs), the ability to boost job creation and reduce extreme poverty has declined. Key downside risks include a further escalation of trade barriers and continued policy uncertainty. These challenges are exacerbated by subdued foreign direct investment into EMDEs. Global cooperation is needed to restore a more stable international trade environment and scale up support for vulnerable countries grappling with conflict, debt burdens, and climate change. Domestic policy action is also critical to contain inflation risks and strengthen fiscal resilience. To accelerate job creation and long-term growth, structural reforms must focus on raising institutional quality, attracting private investment, and strengthening human capital and labor markets. Countries in fragile and conflict situations face daunting development challenges that will require tailored domestic policy reforms and well-coordinated multilateral support.