The demand for Social Safety Nets as a process of social development has increased manifolds due to food inflation and other factors particularly affecting the poor communities. Poverty has become a major global issue that has surpassed terrorism, wars, nuclear disarmament, pollution and other burning issues of 21st century. According to estimates, the number of chronically hungry people that crossed 1 billion in 2009 has reached an alarming level in the past two years due to food inflation and other global factors. State sponsored Social Safety Nets (SSNs) that work as a shock absorber to dilute the fatal effects of poverty are always considered as last-ditch measures to save the millions of people from the cruel poverty trap. Poverty has very strong impact on the life of an individual and society. It ultimately shortens the life-span of victims who are badly hurt by poor nutrition leading to disease. It also expedites the decadence of the socio economic fabric of society that is pushed towards disintegration. Poverty is an option-less phenomenon and for an individual it is impossible to break the shackles without an external rescue operation. In this gloomy scenario of a painful global recession threatening to cripple the fight against poverty everywhere, many countries—both rich and poor—hope to cushion the blow through a set of fiscal stimulus adopted as long term and short term measures.
Poverty alleviation
In any society, there always happen to be an economically weaker segment vulnerable to the poverty trap. Once they are gripped by poverty, economic system in place has no ‘touch-button’ solution to provide them a level playing field. It is here that Social Safety Nets (SSNs) as an interim measure intervene to break the vicious cycle of poverty. They are necessary to alleviate poverty within broader macroeconomic growth policies that take a long time to trickle down benefits to the poor and disadvantaged. Special programmes for poverty alleviation are therefore necessary, especially for countries like our own which has recently been engulfed in an economic crisis that has reversed poverty alleviation gains made during the earlier part of the decade.
Containing poverty is inevitable in a sense that if it is left unchecked it might gradually take into its fold the relatively well-off sections as well. In today’s close-knit societies, you cannot insulate one section of society from the other as poverty and prosperity cannot go hand in hand. Apart from a moral justification of helping the poor, there is strong macroeconomic justification as well. Poor people have a natural propensity to zero saving and quick spending. This circulation of money promotes economic viability to re-energise the weakening economic system deteriorating due to less spending. Some of the pressing questions that governments are trying to grapple with include the size of such stimulus packages, the types of spending they should consist of, and the channels through which they might work most efficiently to stimulate the economy.
Evolving poverty
alleviation strategies
Poverty is on the increase even in rich countries. In the past these countries had a track record of high spending and low taxation coupled with a robust SSN system. So it was easier for them to tackle poverty through counter-cyclical measures to relieve the economic stress on short term basis. But that is no longer the case even in USA, a country having one of the highest GDP rates in the world. The recent US debt crisis is an undeniable fact to support the argument.
If the ongoing momentum of poverty continues unabated, it is a strong prediction that the UN will need to set up an Anti-Poverty Council similar to Security Council to fight the global menace. For an effective campaign against poverty, it is imperative for developed and developing countries to study the systems of each others experiences to deal with the largest common issue for the entire world. For example, the developing countries should follow the rich nations to create pro-poor stabilisers in their state set-up, similar to the automatic social safety nets that rich countries already have in place. Similarly, rich countries can also look to developing countries—which have had more experience with disasters of various kinds, from famines and floods to financial crises—for ideas on how best to protect the poor. Governments in developing countries have experimented with a wide range of social protection programmes, including those that protect poor people from financial crises. The ways in which their public budgets have been programmed provide valuable lessons that could be useful to both rich and poor countries today.
Rehabilitation and corruption
There are two types of people in the universe. Those who extend a helping hand to the poor and those who prey and plunder the poor. Therefore, rehabilitation and corruption often go hand in hand. The stories of pilferage of relief money are rampant in the third world countries. It is a note worthy argument that getting money into the hands of poor people and doing this in an effective and transparent way is very important to plug all the loop-holes of possible corruption that is rampant in poor countries. For example corruption in Benazir Income Support Program (BISP) has surfaced in many districts of Punjab and Sindh where political elements and postal authorities have embezzled huge funds meant for widows. Politics aside, BISP being a huge programme of more than Rs80 billion launched without household date base profiling has proved counter productive but the government is unlikely to roll-back the scheme which is likely to score high voting for the party in power during the coming elections. Lack of following the poverty score card in determining eligibility and unconditional granting of a regular amount are two major flaws in the scheme in addition to other substantial reservations expressed by financial experts. For instance, how many industrial projects can be launched with over Rs80 billion to create employment for thousands of qualified individuals?
Changing lives
The problem with recipients of SSN aid package is that they took it as their earning and wish to spend it at will. This state of mind defeats the fundamental objective of the programmes aimed to changing the lives of these people. Therefore, conditional cash transfers as recommended by World Bank are a wise way to wipe out poverty and make the recipients socially responsible. The World Bank argues two things: the cash should be given into the hands of the poor and they have to pledge that they are bound to take a number of steps to satisfy the donors. The steps committed to be taken are purely for social safety of these classes. For example, sending girls to schools, allowing the women to cast their votes in elections, family planning or allowing women to work are in fact the safety valves to strengthen these distressed classes.
There are big challenges in implementation of SSN programs that include setting the eligibility criteria in practice, introduction of poverty score card, scarcity of resources, demand-supply gap, elite involvement at the local level, and unresponsiveness to changes in people’s needs. However, corruption being a single largest factor has surpassed all these challenges because plundering the poor might turn the whole episode a fruitless exercise.
Community initiated programmes
World Bank criteria advocates that the assets created should be of lasting value, preference should be given to community-initiated projects in poor areas, the wage rate should not be higher than the market rate for similar work and anyone who needs work should be confident that they can get it in a reasonable time. In this perspective, if we evaluate BISP’s key design features, it is clearly evident that no such criteria are laid down in the scheme that is purely based on political motivations to throw away cash as ‘cash for votes’ programme.
It is pertinent to quote World Bank Group President Robert B. Zoellick who said; “With a combination of well-designed and implemented conditional transfers and relief work schemes it is possible to protect a significant number of poor people in a crisis, without damaging their longer-term prospects of escaping poverty. Robust social protection policies require a combination of relief work with transfers in cash or food targeted to specific groups who cannot work due to physical incapacity”. He goes on to say, “A world that doesn’t learn from history is condemned to repeat it”. He thinks that stopping these schemes will have devastating effects. “We need to learn from the history of past crises, when governments squeezed for cash, cut into social programs with often devastating impacts on the poor”, he argued.
The experts say that to undertake a fool proof system of SSNs in Pakistan like BISP, it is essential to dwell into well planned ground-work before launching the scheme. Creation of a database on household profiling for the entire country is an indispensable requirement in this regard. Although it is administratively complex, time consuming and costly but it is the only way to implement the programme in all fairness.
