Equity in MENA and Latin America from a comparison perspective

Equity in MENA and Latin America
from a comparison perspective – the
role of social protection
Fabio Veras Soares
International Policy Centre for Inclusive
Growth – IPC-IG
(www.ipc-undp.org)

Inequities in LAC and MENA
 Latin American countries are well known for their high level of inequalities.
 Recent reforms of the social protection system have tried to curb poverty as well
as to address inequities of the social protection system and to facilitate access to
social services.
 MENA countries have much lower inequality but they are facing challenges with
the current design of their social protection programmes.
 Recent reforms (or talk of) suggest that (some) countries in the MENA region
want to learn more from LAC experience and adapt certain reforms to their
context.

Source (Cedlas)
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0CCcQFjAB&url=http%3A%2F%2Fcedlas.econo.unlp.edu.ar%2Fdownload.php%3Ffile
%3Darchivos_upload%2Fdoc_cedlas151.pdf&ei=lWqOVM7KIMz4UvDOgsgO&usg=AFQjCNEOrz59qWZjzooZZL6YLTDlQR0Cww&sig2=JhOdV9XHEQuId6E40WHMnw&bvm=bv.81828268,
d.d24

Source: ECLAC 2013 Social Panorama

 ECLAC classifies countries in Latin America into three groups as per their
investments social policies (health and education) and in social protection:
Group I: higher level of per capita investment in social protection and social
policies, high investment in social security and assistance, higher investment in
health (similar as education) – Argentina, Brazil, Chile, Uruguay, Costa Rica and
Panama.
Group II: medium level of per capita investment in social protection and social
policies, medium level of investment in social security and assistance, low
investment in healh (half of level in education): Mexico, Colombia and Venezuela
Group III: low level of per capita investment in social protection and social policy,
low investement in social security and assistance, low investment in healt (half of
the level of education): Bolivia, Equador, El Salvador, Nicaragua, Paraguay, Peru and
Dominican Republic

 MENA countries spend relatively more with social protection (or SSN) than LAC
countries…
 However these expenditures tend to be less progressive due to their focus on
fuel and food subsidies.
 Excluding fuel and food subsidies there are somewhat similar level of
investment, but with very different results….
 Social security: sustainability issue, pay as you go system for formal sector
workers and public servants, high reposition rates, almost no coverage of
informal sector, and scattered schemes.
 Social assistance: focus on food subsidies, categorical and geographical targeting
and undercoverage of the poor and high levels of leakage.

World Bank (2014): http://documents.worldbank.org/curated/en/2014/05/19487568/state-social-safety-nets-2014
Spending on SSN and Fuel Subsidies

Source: IMF 2011, Elaboration: Markus Loewe (2014)
0 2 4 6 8 10 12 14 16
Egypt
Algeria
Yemen
Jordan
Tunisia
Bahrain
Moroco
Syria
Oman
Mauritania
Pension schemes
Health system
Cash for work
Social assistance
Child allowances
Food subsidies
Energy subsidies

World Bank (2012) – MENA DEVELOPMENT REPORT - Inclusion and resilience :

 Two key issues with SSN programmes: progressiveness of
the transfers and low coverage.
 Exceptions: The Sadat Pension in Egypt, the Social
Welfare Fund (SWF), PNAFN in Tunisia, Tayssir
programme in Morocco… but some still suffer of
problems of coverage: quotas, unclear targeting and
categorical focus on the unable to work undermine
coverage of poor and vulnerable children.

 In comparison to other world regions, there is clear
underperformance in the Arab region social assistance
and SSN programmes in terms of beneficiary incidence.
 Exceptions: The Sadat Pension in Egypt, the Social
Welfare Fund (SWF), PNAFN in Tunisia, Tayssir
programme in Morocco… but some suffer still of
problems of coverage: quotas, unclear targeting and
categorical focus on the unable to work undermine
coverage of poor and vulnerable children.

 Example from the Yemen targeting assessment of the Social Welfare based on
the NSPMS data (based on Figures on the next slides).
 Figure NSPMS (1) shows that programme age-pyramid resembles that of the target
population.
 However, Figure NSPMS (2) shows that the age-pyramid of the extreme poor and of the
poor does differ from those of categories of the SWF shown in NSPMS (1) – children are
more likely to be among the poor and extreme poor.
 The adoption of the a Proxy Means Test (PMT) improved the SWF targeting of the
inclusion of more households with children among beneficiaries. In Figure NSPMS (3),
new SWF beneficiaries – who were subjected to the PMT – had more families with
children. But NSPMS (3) age pyramid still differs a lot form age pyramid of the poor and
extreme poor NSPMS (2).
 It is necessary to expand social protection programmes for children in Yemen to improve
their targeting.

16
Yemen NSMPS (1): Age pyramid for SWF beneficiaries and SWF categories
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male
SWF beneficiaires
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male
SWF categories
Source: NSPMS Final report (http://www.ipc-undp.org/pub/html/TP08_Yemen_National_Social_Protection_Monitoring_Survey_2012_2013/#6)

17
Yemen NSMPS (2): Age pyramid for the extreme poor and the poor
Extreme Poor Poor
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male

18
Yemen NSPMS (3): Age pyramids – Old and New SWF beneficiary
Old SWF beneficiary New SWF beneficiary
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male
(10) (8) (6) (4) (2) 0 2 4 6 8 10
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
Female Male

 The key point of the experience of Latin American has
been the extension of different social protection
mechanisms in a coordinated way.
 Expansion of the Social Protection programmes to cover
families with children.
 Single registries or integrated databases have had a great
impact on the improvement of the effectiviness of these
policies
 MIS systems and regular monitoring and evaluation have
provided the evidence to support these policies

Equity in MENA and Latin America from a comparison perspective

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