Reengineering Safety Nets To Unlock More Value

  • 4 mins read
  • 31st Aug,2020
  • 113 views

Social protection schemes or ‘safety nets’ the world over have gained considerable currency. These programs shield the poor and vulnerable from crises, help them find jobs, improve productivity and invest in health and education of their children. When done correctly, they help countries to enhance human capital, curb inequalities, build resilience and root out poverty. A World Bank study says 36 per cent of the ‘very poor’ segment have escaped extreme poverty with safety net program.

Safety nets – the scale and spread

Out of 7.8 billion people globally, around 2.5 billion are covered by ‘safety net programmes’. India’s safety net structure is defined by programs like TPDS, ICDS, MDM, MGNREGS, RSBY (now Ayushman Bharat) etc.Likewise, Indonesia’s safety nets benefit 10 million people while Egypt’s Takaful and Karama program (“solidarity and dignity”) schemes offer income support to poor and vulnerable families.

All social protection instruments have a similar delivery chainassess, enrol, provide, monitor and manage. But their implementation is a challenge for governments. Take for example the National Food Security Act offering subsidised food grains under TPDS. The scale of machinery to reach out to 500 million people can be well imagined. The biggest challenges lie in expanding beneficiary coverage on the premise of inclusions and exclusions as well as conducting social audits and impact assessment. On hindsight, India’s success is built on massive GovTech programs from digitization of beneficiaries to DBT and DFT.

Efforts in Africa- Safety nets and the need for overhaul

In Africa, governments and bilateral agencies are struggling to harvest more out of safety net programmes. Many countries in the region have steep poverty rates that outstrip coverage rates. And, a World Bank report shows that just 10 per cent of the targeted population is covered. This is because an overly manual scheme design has failed to ensure a structured monitoring mechanism. Here, automation promises to improve coverage with efficient mapping and delivery.

Ethiopia- The Outlier with its PSNP

Back in 2005, Ethiopia launched its Productive Safety Net Programme (PSNP) to serve six chronically food insecure districts or woredas. With past failures, the enhancement of the program in its fourth phase in 2018 had high emphasis on GovTech. The IT system integrated components like registration, targeting, public work, Direct Support,transfers, skills training, savings, et al based on the Social Protection MIS Guidelines of Ethiopia.

The scheme implementation had its share of challenges- unavailability of internet connectivity in a few woredas, lack of desired skills set to operate the application and no regular updation of beneficiary data. But automation turned around the performance- an impressive 8.5 million beneficiaries covered in Ethiopia until 2019 and the count is expected to shoot up to 11 million by 2021. A cash support component of $341 million has been transferred to 2.4 million beneficiaries across 112 woredas. Plus, the cash transfer to beneficiaries- $51.5 million credited to PDS clients and $120 million transferred to Public Works participants.

African countries can tap GovTech to deliver more from safety nets

The evolution of safety net programmes will be driven by use of analytics in mapping the true beneficiaries where IT will come into play. Here, digital innovations offer opportunities for coordination and transparency for cash, voucher and food-based transfers and benefit management. Electronic beneficiary systems, common beneficiary databases and e-ration or client cards can yield benefits for all.

The distribution of benefits under social safety nets is contingent on the method used to identify beneficiaries. Technology driven beneficiary registry can reduce the cost of targeting beneficiaries and avoid duplication. Along with digital payments, nations can think of applying cloud technologies, process automation & Artificial Intelligence (AI) and Big Data Analytics in delivery chain. Social safety nets in the future would need a wrap of a futuristic GovTech solution.