UN highlights underinvestment in social protection in Asia Pacific

16 Oct 20

Less than half the population in Asia Pacific is covered by government social protection schemes, leaving many vulnerable to poor health, poverty and social exclusion – despite the region’s rapid economic ascent, the UN has found.

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A family selling candles in the Philippines

A family selling candles in the Philippines

The report, from the UN Economic and Social Commission for Asia and the Pacific, called on governments to make social protection a core part of their strategies for socioeconomic development and poverty reduction as they emerge from the coronavirus pandemic.

“Comprehensive social protection creates the foundation for healthy societies and vibrant economies,” said Armida Salsiah Alisjahbana, UN under-secretary-general and executive secretary of UNESCAP.

“The Covid-19 pandemic has brought this imperative into sharp focus, by demonstrating the stabilising effect well-functioning social protection systems have and how their absence exacerbates inequality and poverty.”

Most poverty-targeted schemes are failing to reach the poorest families, the report found, and the pandemic risks reversing poverty eradication progress “by almost a decade”.

“Significant underinvestment” in these schemes is to blame, according to UNESCAP.

Excluding health, many countries in the Asia Pacific region spend less than 2% of GDP on social protection, while the global average is 11%.

The report found that expanding social protection to include basic child benefits, disability benefits and old-age pensions, the proportion of households living in poverty would fall by at least half in several countries (Indonesia, Mongolia, the Maldives and Thailand).

Such a move would cost between 2% and 6% of each country’s GDP, but the report recommended governments should reprioritise existing resources and broaden their tax bases to pay for it.

In many cases this would involve formalising large parts of their economies, but the existing informality has left many people vulnerable during the pandemic, UNESCAP said.

“The Covid-19 crisis has exposed the precarious situation of many working women and men and especially those in the informal economy,” said Chihoko Asada-Miyakawa, regional director of the International Labour Organisation’s Asia Pacific office.

“There is a clear need for further investment in public social protection systems if we are to avoid the stagnation of social and economic progress made across the region in recent decades.”

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