Social protection ‘lifeline’ during COVID depends on where you live |

Offering new data on how social assistance spending has cushioned the unprecedented economic shock unleashed by the pandemic, the United Nations Development Fund (UNDP) Poverty alleviation evaluation, found that in the 41 countries for which data was available, about 12 million people were prevented from falling below the poverty line, out of 15 million at risk.

Rich countries are doing better

While the overall mitigation impact was strong, the study also found that it was largely confined to high and upper-middle income states.

Rich countries spent up to 212 times more per capita than poor countries on social assistance.

UNDP administrator Achim Steiner pointed out that their ability to spend more on social protection measures “played a vital role in preventing people from falling into poverty”.

For low-middle-income countries, the report showed that social assistance spending was insufficient to avert a surge of newly poor people, and in low-income countries it was unable to prevent any loss of income.

“That lifeline depends on where you live,” observed the UNDP chief. “The challenge now is to expand the fiscal space to allow all countries to implement and sustain social assistance spending measures, which has proven to be a very cost-effective and effective way to prevent people from falling into poverty”.

Massive differences

The authors estimated that between 117 million and 168 million people became poor during the pandemic.

Although $2.9 trillion was invested in social protection policies globally, only $379 billion was spent by developing countries.

Meanwhile, on average, high-income countries allocated $847 per capita to social protection measures, including assistance and insurance, while their low- and middle-income counterparts spent an average of just $124. per inhabitant.

At the same time, total social protection per capita in low-income countries alone was only $4.

“Two-Way Takeover”

“The report provides some thoughts on the impact of the pandemic on poor and vulnerable households in developing countries, but also on the importance of policy choices to mitigate the increase in poverty,” said the economist in UNDP chief, George Gray Molina.

He believed that if applied to all poor and vulnerable households in the developing world, a temporary basic income – championed by the UNDP – could have prevented the number of new extreme poor on a global scale.

The study’s projections showed that this could have been achieved by spending just 0.5% of developing countries’ gross domestic product (GDP), spread over six months, on measures related to income support.

“The bottom line, however, is that powerful social assistance programs were beyond the reach of low-income countries, paving the way for a two-track recovery from the pandemic,” the UNDP official said.

Joel C. Hicks