THE WORLD BANK 2012-2022 SOCIAL PROTECTION AND L ABOR STR ATEGY 70887 Resilience, Equity, and Opportunity Resilience, Equity, and Opportunity Contents FOREWORD....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... V ACKNOWLEDGMENTS..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................VII EXECUTIVE SUMMARY................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................ xi 1. RESILIENCE, EQUITY, AND OPPORTUNITY: THE ROLE OF SOCIAL PROTECTION AND LABOR ..............................................................1 WHAT IS SOCIAL PROTECTION AND LABOR? ...................................................................................................................................................................................................................................................................................................................................................................................................................... 1 ROLES OF DIFFERENT ACTORS IN SOCIAL PROTECTION AND LABOR ............................................................................................................................................................................................................................................................................................ 2 A PORTFOLIO APPROACH TO SOCIAL PROTECTION AND LABOR....................................................................................................................................................................................................................................................................................................................... 5 2. LESSONS FROM THE FIRST DECADE OF WORLD BANK ENGAGEMENT IN SOCIAL PROTECTION AND LABOR ..........................................................................................................................................................................................................................................................................................................................................................................................................................................8 THE FIRST SOCIAL PROTECTION AND LABOR STRATEGY .............................................................................................................................................................................................................................................................................................................................................................. 8 A DECADE OF ENGAGEMENT IN SOCIAL PROTECTION AND LABOR ......................................................................................................................................................................................................................................................................................................... 8 LEARNING FROM THE PAST DECADE: WHAT IS NEW ABOUT THIS STRATEGY? .................................................................................................................................................................................................................................................... 9 3. SOCIAL PROTECTION AND LABOR IN TODAY’S WORLD ....................................................................................................................................................................................................................................................................................................14 A GLOBAL CHALLENGE, AN EMERGING CONSENSUS..................................................................................................................................................................................................................................................................................................................................................................... 14 THE GLOBAL STATE OF SOCIAL PROTECTION AND LABOR: PROGRESS, BUT FRAGMENTED APPROACHES................................................................................................ 14 ADDRESSING FRAGMENTATION: MOVING TO A SYSTEMS APPROACH ........................................................................................................................................................................................................................................................................................ 18 LEVERAGING SYSTEMS TO ADDRESS THE COVERAGE GAP: FROM EXCLUSION TO INCLUSION .......................................................................................................................................................... 22 LEVERAGING SYSTEMS TO ADDRESS THE FLEXIBILITY GAP: FROM INFLEXIBILITY TO RESPONSIVENESS ........................................................................................................... 24 LEVERAGING SYSTEMS TO ADDRESS THE OPPORTUNITYGAP: TOWARDS MORE PRODUCTIVE PROGRAMS ......................................................................................... 25 4. STRATEGIC DIRECTION FOR SOCIAL PROTECTION AND LABOR AT THE WORLD BANK ................................................................................................... 29 STRENGTHENING SYSTEMIC APPROACHES...................................................................................................................................................................................................................................................................................................................................................................................................................... 29 ENSURING INCLUSION............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 31 RESPONDING TO CRISES ............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 35 ENHANCING PRODUCTIVITY....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................38 5. PRINCIPLES OF ENGAGEMENT FOR THE WORLD BANK ............................................................................................................................................................................................................................................................................................44 FOCUS ON EVIDENCE-BASED KNOWLEDGE ..................................................................................................................................................................................................................................................................................................................................................................................................................44 TAILOR OPERATIONS TO COUNTRY CONTEXT AND EVIDENCE ............................................................................................................................................................................................................................................................................................................................... 45 COLLABORATE ACROSS SECTORS AND ACTORS............................................................................................................................................................................................................................................................................................................................................................................................47 6. MEASURING AND ACHIEVING SUCCESS: EXPECTED RESULTS AND BUSINESS PLAN IMPLICATIONS.............................55 MEASURING RESULTS .............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................. 55 BUSINESS IMPLICATIONS ..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................57 REFERENCES..................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................61 ANNEX 1: REGIONAL AND ANCHOR APPLICATIONS OF THE SOCIAL PROTECTION AND LABOR STRATEGY ..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................67 ANNEX 2: BACKGROUND PAPERS TO THE SOCIAL PROTECTION AND LABOR STRATEGY 2012–22 ......................................80 ANNEX 3: WORLD BANK SOCIAL PROTECTION AND LABOR PORTFOLIO ..........................................................................................................................................................................................................84 ANNEX 4. RESULTS OF THE SPL STRATEGY CONSULTATIONS ......................................................................................................................................................................................................................................................................88 ANNEX 5: MULTISECTORAL APPROACHES: LINKAGES BETWEEN THE SPL STRATEGY 2012–22 AND OTHER WORLD BANK GROUP STRATEGIES.......................................................................................................................................................................................................................... 92 ANNEX 6. SOCIAL PROTECTION STRATEGIES OUTSIDE OF THE WORLD BANK................................................................................................................................................................96 ANNEX 7: RESULTS FRAMEWORK .............................................................................................................................................................................................................................................................................................................................................................................................................................................. 102 NOTES....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................... 106 THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY III BOXES FIGURES BOX 2.1: IEG’S 2011 EVALUATION OF WORLD BANK FIGURE 1: THREE LEVELS OF ENGAGEMENT SUPPORT FOR SOCIAL SAFETY NETS.......................................................................................... 11 FOR SPL SYSTEMS ....................................................................................................................................................................................................... xv BOX 2.2: RESULTS OF THE STRATEGY FIGURE 1.1: GOALS OF SOCIAL PROTECTION CONSULTATIONS............................................................................................................................................................................................................. 12 AND LABOR................................................................................................................................................................................................................................................. 3 BOX 3.1: THE SOCIAL PROTECTION FLOOR............................................................ 16 FIGURE 1.2: SPL CONTRIBUTES TO PRODUCTIVITY, GROWTH, AND POVERTY REDUCTION ............................................................................................ 4 BOX 3.2: VIETNAM: ADDRESSING FRAGMENTATION AND MODERNIZING SPL ...................................................................................................................................................................17 FIGURE 1.3: SPL PROGRAMS WORK DYNAMICALLY OVER THE LIFE CYCLE TO PROVIDE RESILIENCE, BOX 3.3: “SMART� SPL SYSTEMS ........................................................................................................................ 19 EQUITY, AND OPPORTUNITY..................................................................................................................................................... 5 BOX 3.4: EMBEDDING SOCIAL PROTECTION FIGURE 2.1: SHARE OF SPL LENDING: IBRD, IDA WITHIN NATIONAL PRIORITIES IN RWANDA ............................................................ 20 AND GRANTS (FY98-11) ................................................................................................................................................................................ 8 BOX 3.5: RULES, ROLES, CONTROLS—GOVERNANCE FIGURE 2.2: NEW WORLD BANK COMMITMENTS IN SOCIAL PROTECTION .................................................................................................................................................................... 21 TO SPL, 1998-2011 ($ MILLION)............................................................................................................................... 10 BOX 3.6: USING COMMUNITIES TO ENHANCE FIGURE 3.1: CASH TRANSFERS IN AFRICA ACCOUNTABILITY: INDIA AND MALAWI...................................................................................... 22 ARE FRAGMENTED ACROSS MINISTRIES BOX 3.7: CONDITIONAL CASH TRANSFERS: AND BETWEEN GOVERNMENT AND PROTECTING THE POOR AND PROVIDING NON-GOVERNMENT ACTORS ........................................................................................................................................17 OPPORTUNITY .......................................................................................................................................................................................................................... 26 FIGURE 3.2: THREE LEVELS OF ENGAGEMENT BOX 4.1: BRAZIL: BOLSA FAM�LIA AND THE IMPACT FOR SPL SYSTEMS ................................................................................................................................................................................................... 19 OF INTEGRATED SOCIAL ASSISTANCE...................................................................................... 31 FIGURE 3.3: MOST OF THE POPULATION IN AFRICA, BOX 4.2: SOCIAL PROTECTION IN FRAGILE CONTEXTS: MENA, AND SOUTH ASIA RECEIVE LITTLE IN THREE APPROACHES.................................................................................................................................................................................. 33 THE WAY OF SPL TRANSFERS.................................................................................................................................... 23 BOX 4.3: PROMOTING LIVELIHOODS AND FOOD FIGURE 4.1: BUILDING SPL SYSTEMS SECURITY IN RURAL ECONOMIES.............................................................................................................34 APPROPRIATE FOR DIFFERENT BOX 4.4: USING CELL PHONES TO PROTECT INSTITUTIONAL CONTEXTS ......................................................................................................................................................30 THE POOR IN KENYA.........................................................................................................................................................................................34 BOX 4.5: DESIGNING GENDER-SENSITIVE PUBLIC WORKS PROGRAMS: INDIA’S MAHATMA GANDHI TABLES NATIONAL RURAL EMPLOYMENT TABLE 3.1: A CHANGING WORLD.................................................................................................................... 15 GUARANTEE PROGRAM ......................................................................................................................................................................36 TABLE 6.1: SPL STRATEGY RESULTS BOX 4.6: THE WORLD BANK’S CONCEPTUAL AT A GLANCE..................................................................................................................................................................................................................................56 FRAMEWORK FOR PENSIONS.....................................................................................................................................37 BOX 4.7: MOBILIZING SOCIAL PROTECTION IN THE FACE OF CLIMATE CHANGE..........................................................................................................37 BOX 4.8: WORLD DEVELOPMENT REPORT 2013 ON JOBS: PRELIMINARY MESSAGES AND POTENTIAL LINKS TO THE SPL STRATEGY .........................................39 BOX 4.9: THE MILES FRAMEWORK..............................................................................................................40 BOX 4.10: ACTIVE LABOR MARKET PROGRAMS AND THE YOUTH EMPLOYMENT CHALLENGE ................................................ 41 BOX 5.1: SOUTH-SOUTH LEARNING IN SOCIAL PROTECTION AND LABOR ..........................................................................................................................................................46 BOX 5.2: ARCHITECTURE AND ENGINEERING: THE WORLD BANK’S OPERATIONAL SERVICES TO COUNTRIES ON SPL SYSTEMS.............................................................................................................48 BOX 5.3: STEP: A MULTISECTORAL FRAMEWORK FOR BUILDING SKILLS AND ENHANCING PRODUCTIVITY..........................................................................................................................................................................................................................49 BOX 5.4: PREPARING FOR THE NEXT CRISIS: BUILDING SPL SYSTEMS WITH THE RAPID SOCIAL RESPONSE PROGRAM............................................................................................................................................................................ 52 IV RESILIENCE, EQUIT Y, OPPORTUNIT Y Foreword Effective social protection and labor (SPL) policies their human capital, and through access to better jobs occupy center stage, as never before. As our global- and income which can propel them out of poverty. ized world continues to be gripped by an economic downturn, few countries are spared from having to To that end, the strategy takes into account the impor- wrestle with the consequences for their people of tance of having well-functioning social safety nets, unanticipated economic shocks and unmet expecta- proven to reduce poverty and inequality, promote tions for good jobs. access to health and education among poor children, and empower women; and sustainable social insur- The decade ahead is fraught with risk. Yet it is also ance programs that help cushion the impact of crises �lled with promise for those who can manage these on households. And the strategy promotes effective risks and access opportunities. To assist countries in policies for productive employment which help people delivering on this promise for all their citizens, the gain access to labor markets and accumulate skills, World Bank has developed a new SPL strategy. The both during recovery from economic crisis and in strategy is built on a platform that helps overcome normal times. four elemental gaps in SPL today: in integration across programs and functions, in access to SPL The strategy is designed to help harness knowledge instruments, in promotion to ensure access to jobs management in key ways: by generating evidence and and opportunities, and in global knowledge of effec- lessons to inform effective policies; promoting South- tive SPL approaches. South knowledge sharing and open access to data and information; and providing global leadership in After extensive consultation and dialogue with clients, research, analysis and data management. stakeholders and practitioners about needs in this fast-changing world, we have designed the strategy Today, SPL at the World Bank is a young, strong sec- with a core focus: to move SPL from isolated interven- tor, accounting for a signi�cant share of Bank lending tions to a coherent, connected portfolio of programs. and knowledge – and serving as a global leader in its This systemic approach helps countries to address work on evidence-based policy-making. The strategy the fragmentation and duplication across programs, builds on the foundation of this work. and to create �nancing, governance and solutions tailored to their own contexts. This publication sets out a snapshot of the strategy’s goals, direction, and commitments. We believe that the A focus on systems is not an end in itself. It is a gate- strategy provides a fundamental underpinning to the way to deliver outcomes. Effective SPL systems build work of the Bank and its development partners and resilience by ensuring that individuals and families are hope that it responds to the needs of countries engaged well-protected against the sudden shocks that are likely in the move toward effective SPL – and ultimately more to overwhelm them. They improve equity at both effective and inclusive growth and development. national and global levels by reducing poverty and destitution – with strong support to people in low income countries, and those in the informal sector. And Tamar Manuelyan Atinc they promote opportunity to improve people’s produc- Vice President, Human Development Network tivity and incomes, through preserving and building World Bank THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY V VI RESILIENCE, EQUIT Y, OPPORTUNIT Y Acknowledgments The World Bank Social Protection and Labor Strategy Strategy, whose members have been generous with 2012–22 was prepared by a team led by Arup Banerji their time, insights, and guidance. The Advisory (Director, Social Protection and Labor [SPL]) and Committee comprised of Fatima Al-Balooshi (Ministry Laura Rawlings (Task Team Leader) and composed of of Social Development, Bahrain), Cai Fang (Institute members of the World Bank’s Social Protection and of Population and Labor Economics at the Chinese Labor Sector Board, including (in alphabetical order), Academy of Social Sciences, China), Victoria Harold Alderman, Anush Bezhanyan, Aline Coudouel, Garchitorena (Ayala Foundation, Philippines), Evgeny Gustavo Demarco, Yasser El-Gammal , Emanuela Gontmakher (Institute of Contemporary Development Galasso, Marito Garcia, Roberta Gatti, John Giles, and Center for Social Policy Studies at the Institute of Pablo Gottret, Margaret Grosh, Jesko Hentschel, Economics of the Russian Academy of Sciences, Emmanuel Jimenez, Marju Kymalainen, Kathy Lindert, Russia), James Dorbor Jallah (Ministry of Planning and Jennie Litvak, Cem Mete, Raj Nallari, Riikka Noppa, Economic Affairs, Liberia), Samura Kamara (Ministry Bassam Ramadan, Mansoora Rashid, Jaime of Finance, Development and Economic Planning, Saavedra, Lynne Sherburne-Benz, Emmanuel Sierra Leone), Ravi Kanbur (Cornell University, United Skou�as, Adam Wagstaff, and Xiaoqing Yu. States), Romulo Paes De Sousa (Ministry of Social Development and Fight against Hunger, Brazil), and The core team preparing the strategy included Colin Jose Manuel Salazar-Xirinachs (International Labour Andrews, Cecilia Costella, Raiden Dillard, Mark Organization). Dorfman, John Elder, Richard Hinz, Maddalena Honorati, Federica Marzo, Hideki Mori, Azedine A set of nine background papers and two background Ouerghi, Francine Pagsibigan, Robert Palacios, notes served as critical inputs to the preparation of Aleksandra Posarac, Shams ur Rehman, David the strategy and provide additional guidance in core Robalino, Dung Thi Ngoc Tran, and Ruslan Yemstov. areas. The papers are listed in Annex 2. The authors include Harold Alderman, Rita Almeida, Colin The team is grateful for full support on the issues Andrews, Juliana Arbelaez, Lucy Bassett, Yoonyoung provided by Mahmoud Mohielden (Managing Director) Cho, Rachel Cipryk, Sabine Cornelius, Cecilia and the deep intellectual and strategic guidance from Costella, Maitreyi Das, Mark Dorfman, John Elder, Tamar Manuelyan Antic (Vice President, Human Emanuela Galasso, Sara Giannozzi, Rasmus Heltberg, Development Network [HDN]). The strategy team also Maddalena Honorati, Arvo Kuddo, Anne T. Kuriakose, bene�ted from the comments and suggestions of the Tanja Lohmann, David Margolis, Federica Marzo, Karla Executive Directors of the World Bank, especially those McEvoy, Hideki Mori, David Newhouse, Mirey who are members of the Committee on Development Ovadiya, Karen Peffley, Lucian Pop, Aleksandra Effectiveness (CODE), and from World Bank senior Posarac, Laura Rawlings, Dena Ringold, David management across regions and sectors. Special Robalino, Maria Laura Sanchez Puerta, Ian Walker, thanks are extended to Anna Brandt, Chair of CODE. Sophie Warlop, Michael Weber, Briana Wilson, William Wiseman, Ruslan Yemtsov, Hassan Zaman, We would like to thank other members of the Human and Giuseppe Zampaglione. The background papers Development Council for their guidance, including were richer for the advice and comments from an Cristian Baeza, Ariel Fiszbein, Keith E. Hansen, even broader range of World Bank staff working on Elizabeth King, Steen Jorgensen, Bruno Laporte, social protection and labor. Mamta Murthi, Ritva S. Reinikka, Ana Revenga, Michal Rutkowski, and David Wilson. The team would also like to thank the many others who contributed to the strategy formulation, with We are also grateful for the guidance and direction papers, sections, comments, advice, and coordination, from a distinguished Advisory Committee for the including Paloma Acevedo, Ihsan Ajwad, Omar Arias, THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY VII Ana Maria Arriagada, Giedre Balcytyte, Chris Bene, The strategy team is grateful to the government John D. Blomquist, Hana Brixi, Mukesh Chawla, of�cials of partner countries, global development Ravindra Cherukupalli, Sarah Coll-Black, Tim Conway, partners, representatives of civil society organizations, Amit Dar, Mark Davies, Carlo del Ninno, Benedicte de trade unions, and think tanks who made valuable la Briere, Gustavo Demarco, Jean-Jacques Dethier, recommendations—both formal and informal— Louise Fox, Uwe Gehlen, John Giles, Margaret Ellen throughout the strategy development and drafting Grosh, Rebekka Grun, Yvonne W. Hensley, Anne Hyde, process. The entire group is too large to list, but we Theresa Jones, Will Kemp, Dug-ho Kim, Adea Kryseu, would like to especially thank those who were kind Jessica Lee, Alessandro Legrottaglie, Andrew Mason, enough to host multicountry and multistakeholder Gisu Mohadjer, Nadeem Mohammad, Ida Mori, Philip consultation events. O’Keefe, Truman Packard, Idah Pswarayi-Riddihough, Setareh Razmara, Helena Ribe, Rafael Rofman, Manuel Finally, we thank our partners—including the Asian Salazar, Anita Schwarz, Ozan Sevimli, Iffath Sharif, Development Bank, the African Development Bank, Kamal Siblini, Oleksiy Sluchynsky, Concha Steta, the Food and Agriculture Organization, the Christopher Thomas, Tony Thompson, Maria Cristina International Trade Union Confederation, the Uehara, Dominique van de Walle, Julie van Domelen, Inter-American Development Bank, the International Milan Vodopivec, and Penny Williams. Food Policy Research Institute, the International Labour Organization, HelpAge International, Oxfam, Throughout the development of the strategy, the team Save the Children, the United Nations Children’s bene�ted from generous contributions by many more Fund, the United Nations Development Programme, staff. We are particularly grateful to the communications the World Food Program, and the aid agencies of teams in Human Development Network composed of the governments of Australia, Canada, Denmark, the Clare Fleming, Phillip Hay, Patrick Ibay, Melanie European Commission, Germany, Italy, Japan, the Mayhew, Carolyn Reynolds, and Julia Ross. We are Netherlands, Norway, Russian Federation, Spain, also very grateful for the extraordinary support extended Sweden, Switzerland, United Kingdom, and the by numerous World Bank �eld of�ces and Social United States—for giving us their advice and Protection and Labor staff who led, organized, and comments, and for the opportunity to consult participated in the consultations. with their staff. VIII RESILIENCE, EQUIT Y, OPPORTUNIT Y Abbreviations and Acronyms AAA Analytical and Advisory Activity MIC Middle-income Country ADB Asian Development Bank MILES Macroeconomic Stability, Investment AfDB African Development Bank Climate and Infrastructure, Labor ALMP Active Labor Market Program Regulations, Education and Skills, Social AU African Union Protection [framework] 3P Prevention, Protection, Promotion MIS Management Information System [framework] MENA Middle East and North Africa BLT Bantuan Langsung Tunai (Direct Cash M&E Monitoring and Evaluation Assistance Program, Indonesia) NGO Nongovernmental Organization CCT Conditional Cash Transfer OECS Organization of Eastern Caribbean States CODE Committee on Development Effectiveness OPCS Operations Policy and Country Services CPIA Country Policy and Institutional Assessment PMT Proxy Means Targeting CRED Center for Research in the Epidemiology of PREM Poverty Reduction and Economic Crisis Management CSO Civil Society Organization PSNP Productive Safety Nets Program (Ethiopia) DDR Disarmament, Demobilization, and RSBY Rashtriya Swasthya Bima Yojna Reintegration (National Health Insurance Program, India) DEC Development Economics Vice Presidency RSR Rapid Social Response DFID Department for International Development SAR South Asia Region (United Kingdom) SDN Social Development Network EAP East Asia and the Paci�c SIF Social Investment Fund ECA Europe and Central Asia SIEF Spanish Strategic Impact Evaluation Fund ESW Economic and Sector Work SMART Synchronized, Measurable, Affordable, EU European Union Responsive, Transparent and Accountable FAO Food and Agriculture Organization of the [framework] United Nations SPF-I One-UN Social Protection Floor Initiative FBS Fee-Based Service SPL Social Protection and Labor FPD Financial and Private Sector Development SRM Social Risk Management HDN Human Development Network SSIU Social Protection Sector Strategy IBRD International Bank for Reconstruction and Implementation Update Development SSN Social Safety Net ICR Implementation Completion Report STEP Skills Towards Employability and Productivity ICT Information and Communication Technology [framework] IDA International Development Association TA Technical Assistance IDB Inter-American Development Bank TF Trust Fund IEG Independent Evaluation Group UBsim Unemployment Bene�ts Simulation Tool IFPRI International Food Policy Research Institute UCT Unconditional Cash Transfer ILO International Labour Organization/ UN United Nations International Labor Of�ce UNDP United Nations Development Programme IPCC Inter-Governmental Panel on Climate UNICEF United Nations Children’s Fund Change US United States ISSA International Social Security Association VUP Vision 2020 Umurenge Program (Rwanda) IZA Institut zur der Zukunft der Arbeit/ Institute WDI World Development Indicator for the Study of Labor WFP United Nations World Food Programme LAC Latin America and the Caribbean WHO World Health Organization LIC Low-income Country MDG Millennium Development Goal MDTF Multi-Donor Trust Fund THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY IX X RESILIENCE, EQUIT Y, OPPORTUNIT Y Executive Summary Risk and the quest for opportunity feature heavily in economic life in the 21st century. Sustained growth in The World Bank’s social protection and labor practice many developing countries has pulled billions out of will help countries move from fragmented approaches poverty and into the middle class; but this economic toward more coherent systems for social protection and upturn has yet to reach billions more, who face unem- ployment, disability, or illness, and struggle to protect labor, and help to make these more responsive, themselves and their families against shocks. The productive and inclusive. poor are particularly vulnerable, being typically more exposed to risk and less able to access opportunities. equality of opportunity. But these policies also In a world �lled with risk and potential, social promote opportunity by building human capital, protection and labor systems are being built, re�ned assets, and access to jobs and by freeing families to or reformed in almost every country to help people make productive investments because of their greater and families �nd jobs, improve their productivity, cope sense of security. At a macroeconomic level, well- with shocks, and invest in the health, education, and functioning social protection programs are central to well-being of their children. growth-promoting reforms. Indeed, according to the Growth Commission: “…if governments cannot Social protection and labor systems, programs and provide much social protection, they may have to policies buffer individuals from shocks and equip them tread more carefully with their [growth-promoting] to improve their livelihoods and create opportunities to economic reforms.� 2 build a better life for themselves and their families. Consider this: A baby in a poor family does not starve The World Bank supports social protection and labor during the 2011 drought in the Horn of Africa, because in client countries as a central part of its mission to Ethiopia’s national public works program provides his reduce poverty through sustainable, inclusive growth. parents with a minimum income. An old man in Ukraine The World Bank’s new social protection and labor is able to deal with his unexpected disability by going strategy (2012-22) lays out ways to deepen World to the “one-stop shop� in his local welfare of�ce, where Bank involvement, capacity, knowledge, and impact in the staff can quickly direct him to the right program he social protection and labor.3 needs. And a young unemployed woman in the Dominican Republic is able to �nd a job that pays her a Three overarching goals, a clear strategic direction, good wage—because she could access a job-training and engagement principles guide this new strategy: program focused on her needs.1 ■ The overarching goals of the strategy are to help improve resilience, equity, and opportunity for While social protection and labor policies and pro- people in both low- and middle-income countries. grams are designed for individuals and families, they ■ The strategic direction is to help developing can also be broadly transformative—by providing a countries move from fragmented approaches to foundation for inclusive growth and social stability. more harmonized systems for social protection and These policies and programs help create opportuni- labor. This new strategy addresses gaps in the ties essential to save lives, reduce poverty, and current practice by helping make social protection promote inclusive growth. and labor more responsive, more productive, and more inclusive of excluded regions and groups— Social protection and labor programs directly improve notably low-income countries and the very poor, resilience by helping people insure against drops in the disabled, those in the informal sector and, in well being from different types of shocks and equity many cases, women. by reducing poverty and destitution and promoting THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XI Box 1 Motivating the New Strategy: The Decade Ahead The next decade presents fast-moving social and economic changes. The World Bank developed the new social protection and labor strategy to help countries cope with the rapidly shifting socioeconomic landscape ahead. The world is increasingly becoming interconnected and risky, with economic shocks and epidemics flowing across national borders. While young people seek jobs in record numbers in some places, aging is shrinking the productive population and ushering in new �scal challenges in others. Poverty, inequality, and exclusion still persist in every country, and the lack of “equality of opportunity� to access quality education, health, and nutrition makes economic mobility unattainable for many poor people. Moreover, the future for productive jobs looks uncertain for a large swath of the world’s workers, who face unemployment or underemployment. Yet, people across the world are facing a future offering extraordinary potential. Over the last decade, billions in the developing world have emerged out of poverty. Steady economic growth will pull up many more. By one measure, 1.2 billion people have joined the “middle class� in developing countries since 1990 and are able to invest in themselves, their children, and the economy. Dramatic improvements in education and health mean that parents in developing and emerging countries can look forward to a much longer, more productive life for their children. Against this backdrop, a growing body of evidence is emerging on the importance of effective social protection and labor programs and policies. Extensive analysis shows that well-designed, well-targeted social protection and labor programs can affordably help households manage risk in the face of shocks. Moreover, these pro- grams can improve nutrition, health, and education outcomes for children, create access to better jobs, empower girls and women, and promote greater equity. The One-UN Social Protection Floor initiative currently led by the International Labour Organization and the World Health Organization has been endorsed by the United Nations, the G-20, and numerous govern- ments and non-governmental organizations. It promotes the importance of effective social protection and labor programs and policies. In addition, multilateral banks, United Nations agencies, the European Commission, and bilateral partners are increasingly helping countries to improve their social protection and labor efforts. Most important, both middle- and low-income countries are building successful social protection and labor programs and experimenting with reforms, including: ■ Asignación Universal por Hijo para Protección Social in Argentina ■ Bolsa Familia (and the new Brasil Sem Miséria) program in Brazil ■ Productive Safety Nets program in Ethiopia ■ Mahatma Gandhi National Rural Employment Guarantee program in India ■ Di bao reforms in China ■ Progresa and Oportunidades programs in Mexico. ■ The engagement principles for working with evidence, building capacity, and supporting knowl- clients are to be country-tailored and evidence- edge sharing and collaboration across countries. based in operations and knowledge work, and collaborative across a range of sectors and actors. This social protection and labor strategy builds on the achievements—as well as the lessons—from practice The strategy is not a “one size �ts all� approach. over the last decade and more. Moreover, it builds on Instead, it calls for improving evidence, building the basic analytical foundation of the �rst World Bank capacity, and sharing knowledge across countries to social protection and labor strategy. facilitate informed, country-speci�c, �scally sustain- able social protection and labor programs and But the strategy also stakes out new ground to meet systems. The World Bank will support this agenda not new challenges. First, it brings a stronger focus on only through lending, but critically by improving solutions, underscoring the need to build a coherent XII RESILIENCE, EQUIT Y, OPPORTUNIT Y portfolio of social protection and labor programs—or a social protection and labor system—that together help In a world �lled with risks and potential, people use people deal with multiple risks. This recognizes that social protection and labor programs to manage risk the focus until the mid-2000s had been more on and volatility, protect them from destitution, and improving programs than on building systems. connect to opportunities. Second, the strategy strongly commits to extending social protection and labor programs to the destitution—through instruments that improve poorest countries and the poorest people, who are resilience, equity, and opportunity.4 the least integrated, yet have the largest needs. This includes those in the informal sector. It does not imply Resilience through insuring against drops in well lessening engagement in middle-income countries. being from a range of shocks. Key sources of resilience are social insurance programs that minimize Third, the strategy stresses the central role of jobs the negative impact of economic shocks on and opportunity. It lays out an agenda for both individuals and families—such as unemployment and operations and partnership—a multisectoral approach disability insurance, old-age pensions, and scalable to both improve human capital—with a strong focus public works programs. Complementary programs in on children and workers’ skills and productivity and other sectors are also extremely important for to improving people’s ability to access those jobs resilience—such as crop and weather insurance and and opportunities. health insurance. Private and informal arrangements (such as savings, assets, and family- or community- Fourth, the strategy highlights the importance of based support) are vital, too. appropriate knowledge in social protection and labor practice, building on past experience. It especially Equity through protecting against destitution and stresses the importance of evidence and of global promoting equality of opportunity.5 Social assistance South-South flows of knowledge about what works in programs (also known as safety net programs—including social protection and labor. cash transfers and in-kind transfers, such as school feeding and targeted food assistance) alleviate This is an ambitious agenda. To realize it, the World chronic poverty and protect against destitution. Bank will need to collaborate across sectors and They also protect poor individuals and families from development partners. It will especially address the irreversible and catastrophic losses of human capital limited global knowledge and experience in some (nutrition, health, and education), thereby contributing central areas (such as effective solutions in weaker to equality of opportunity. institutional capacity settings) and promote approaches that are both cost-effective and Opportunity for people through promoting better �scally sustainable. It will help to generate access health, nutrition, education, and skills development, to productive jobs for those who can work. And it along with helping men and women access will engage in policy dialogue that help countries tackle complex trade-offs across programs and What are Social Protection and objectives, while keeping a focus on affordability Labor Programs? and future �scal sustainability. Social assistance (social safety nets): Such as cash transfers, school feeding and Goals of Social Protection and targeted food assistance Labor: Resilience, Equity, and Social insurance: Such as old-age and disability Opportunity pensions, and unemployment insurance Social protection and labor systems, policies, and Labor market programs: Such as skills-building programs help individuals and societies manage risk programs, job-search and matching programs, and and volatility and protect them from poverty and improved labor regulations THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XIII productive work. Institutions that promote opportunity ■ Promoting greater labor market mobility are often integrated with those supporting resilience ■ Stabilizing aggregate demand, notably during and equity. For example, labor market programs recessions provide unemployment bene�ts, build skills, and ■ Enhancing productive assets and infrastructure (for enhance workers’ productivity and employability. Cash example, through public works) transfers incentivize investments in human capital by ■ Reducing inequality in society promoting demand for education and health and help ■ Making growth-enhancing reforms more politically address gender inequalities. And public works feasible programs provide cash payments to the poor, while ■ Beyond risk management and poverty reduction, increasing physical capital investments. social protection and labor policies and programs are increasingly recognized as a vehicle for The goals of resilience, equity, and opportunity cannot implementing social contracts, securing people’s be achieved with isolated programs, within a single rights, and ful�lling their obligations. sector, or through public mandates alone. Attaining them requires an appropriate policy, legal and institu- tional frameworks, as well as a portfolio of instruments Strategic Direction: and collaboration across economic sectors. From Fragmented Approaches to More Coherent Systems For instance, agricultural crop insurance provides resilience to farmers, as do savings from micro-sav- Many social protection and labor programs are frag- ings schemes and rotating savings associations. mented and lack harmonization, hampering their Charitable institutions and worker remittances pro- effectiveness. The World Bank’s new social protec- vide equity-promoting transfers in many societies. tion and labor strategy’s main objective is to help The availability of good schools and clinics is critical countries move from fragmented approaches to har- for the poor looking to improve their children’s monized systems. It focuses on making these systems human capital. Private �rms are the most important more inclusive of the vulnerable and more attuned to vehicles for good jobs and opportunity, and often building people’s capacities and improving the pro- invest in building workers’ skills. Informal social net- ductivity of their work. It seeks to make people better works are often best for youth seeking better able to respond to crises and shocks. opportunities to use those skills. Reducing fragmentation across programs, actors, and The government plays a role in setting the agenda for levels of government can decrease inef�ciencies, social protection in line with societal goals and in over- enhance coverage, and improve responsiveness to seeing the ef�cacy of social protection and labor risks. The strategy also focuses on three critical global measures, be they public, private or informal. The state gaps in social protection and labor today: exclusion, has a particular role to play when there are the inevi- where existing programs fail to reach key vulnerable table gaps in access—and when private measures fail groups; poor links to opportunities, where programs to meet societies’ objectives resulting from, for and systems do not always connect people to pro- instance, failures in the markets for credit or insurance. ductive potential; and inflexibility, where programs are unable to accommodate those made newly vulnerable Social protection and labor policies and programs because of systemic shocks. can provide a broad-based foundation for inclusive growth and social stability, and, when properly designed, are also affordable. Although there remains considerable debate on the role and Social protection and labor systems are portfolios of contributions of social protection, there is growing coherent programs that can communicate with each evidence that it contributes to growth by:6 other, often share administrative sub-systems, and ■ Building and protecting human capital work together to deliver resilience, equity, and ■ Providing the security to invest in higher-risk– opportunity. higher-return activities XIV RESILIENCE, EQUIT Y, OPPORTUNIT Y FROM FRAGMENTATION TO SYSTEMS Although the exact form of social protection and In many countries, social protection and labor pro- labor systems will necessarily vary across countries, grams simply do not exist at scale. Instead, smaller many basic functions are similar. At the policy, unconnected efforts focus on distinct regions, discrete program and administrative levels, there are common groups, or speci�c objectives without complementing challenges and the need for capacity building and each other. In other contexts, larger-scale programs knowledge sharing is widespread. For example, at may exist, but may not be cost-effective, coherent in the policy level, there is a need for affordable, �scally terms of the incentives they provide, or responsive to sustainable approaches that can serve as a basis for economic downturns. A systems-oriented approach to meeting coverage gaps. At the program level, social protection and labor programs strengthens coor- countries need ways to cost-effectively deliver dination and integration at the policy, program, and appropriate bene�ts to the most vulnerable. At the administrative subsystems levels; adapted to different administrative level, many countries are making country contexts (see Figure 1). important advances in developing citizen registries by household, age, and income, and using them to In many low-income countries, especially in fragile coordinate service delivery across relevant social contexts, taking a systems approach could involve protection and labor programs. �rst investing in a single program and developing basic administrative systems—for example, bene�ciary The aim is to help countries move toward systematic registries, cash delivery mechanisms, and targeting approaches that have �ve “SMART� characteristics: approaches. Once these subsystems are functional, Synchronized across programs they could then be expanded incrementally to other Monitored, evaluated, and adapted programs. But countries face the larger challenges of Affordable, �scally and in terms of improving and coordinating different programs that cost-effectiveness serve complementary functions, and of ensuring their Responsive to crises and shocks �t with the broader policy environment. Transparent and accountable Figure 1 Three Levels of Engagement for SPL Systems Administration level: Aim: Building basic subsystems to support one or more programs Program Program level: Program Admin. Aim: Improving design of existing sub- systems Program programs and harmonizing across portfolio of programs Policy level: Program Aim: Ensuring overall policy coherence across programs and levels of government Source: Robalino, Rawlings and Walker 2012 THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XV FROM EXCLUSION TO INCLUSION ■ Second, creatively addressing the institutional Today, many who most need good social protection weaknesses by, for example, engaging civil society and labor programs and systems are often the least and communities (for example, through social likely to have access to them. Poor populations, funds) and using information and communication marginalized groups, and those working in the technology. informal sector are particularly excluded. Countries ■ Third, focusing on building country administrative with fewer �scal resources and a larger share of poor and �nancial capacity to develop, integrate, and people, especially in Sub-Saharan Africa, typically expand social protection and labor systems. have fewer bene�ciaries of social protection and labor transfers and face dif�cult choices about how to In all cases, decision makers will need to use creativ- expand coverage, while ensuring �scal sustainability. ity, innovation, and adaptation—relying on greater evidence and knowledge sharing. This evidence and Within many countries, social insurance programs knowledge is important for raising governments’ (such as old-age pensions and disability and unem- awareness of the social and economic bene�ts of ployment bene�ts, as well as many active labor market social protection and labor, as well as for guiding programs, such as skills training) bene�t only formal reforms. It can also inform dif�cult decisions about sector workers, excluding the informal and agricultural how to allocate scarce resources, and help policy- workers who are often a large share of the population. makers address pressures to invest in more visible, And many programs are not available to those who immediate projects or respond to more vocal and are most in need—the poorest of the poor, disabled empowered constituents. and illiterate people, the urban homeless, those who are socially excluded, and those who live in remote Many existing programs provide models of inclusion areas. The 2012 World Development Report on gen- that can be studied and adapted. Indonesia’s Direct der and development notes that poor women are Cash Assistance program used gender-balanced often among the most disadvantaged, especially in community-based groups to identify the neediest.8 their access to services.7 The National Health Insurance Program (RSBY) in India enrolls informal sector workers (including self- But the challenges of inclusion are substantial. employed women) in social insurance. The Brasil Sem It can be dif�cult to have the excluded participate in Miséria and Chile Solidario cash transfer programs social protection and labor programs, as they are often use targeted communications and outreach by inter- the hardest to reach, being cut off from information and mediaries to reach the very poorest. The successful education. Aligning coverage goals with cost-effective Jóvenes skills programs in Latin America, aimed at solutions often requires dif�cult choices about trade-offs. disadvantaged young men and women, integrate Implementing programs effectively is usually a greater programs with the private sector.9 challenge than developing good designs, calling for attention to program detail, capacity building, and perfor- FROM LESS TO MORE PRODUCTIVE mance management. And sometimes strong vested Enhancing productivity calls for focusing both on interests or engrained perspectives block more inclusive young children and on those of working age. Studies policies—necessitating courageous political choices and show that investing in early childhood nutrition and changing societal attitudes. preschool stimulation can be predictors of productiv- ity later in life.10 And a continuing agenda can link Making social protection and labor systems more bene�ciaries of social protection programs to other inclusive will require investment and innovation, with programs that can activate them into the labor market particular challenges in low-income and fragile contexts. This will require three major sets of actions: ■ First, providing catalytic investments to build the South-South knowledge flows are critical in �nding basic administrative subsystems that can serve as solutions in the area of social protection and labor. the backbone of social protection and labor Fostering these exchanges among practitioners is going programs, such as through the Rapid Social to be a central agenda for the World Bank. Response Program (see Box). XVI RESILIENCE, EQUIT Y, OPPORTUNIT Y or equip them with relevant and marketable skills— long-term poverty and lack of opportunity, as well these effective “graduation� strategies can provide as being critical in response to crisis. This requires pathways to move people from welfare to work. investment by countries at three levels: �rst, to ensure that there are longer-term programs and This work on enhancing people’s productivity will broader social protection and labor systems in require World Bank social protection and labor teams place before crises hit; second, to enhance existing to collaborate across sectors and with partners to sup- programs so that they can more easily capture the port client countries. It is critical to build on the newly vulnerable (such as more flexible and fre- resilience and equity dimensions central to many social quent mechanisms for identifying bene�ciaries); protection and labor programs and to use them to and third, to add programs to the portfolio—such as connect to complementary programs in other sectors. public works and unemployment insurance—that For instance, a country will need collaboration among can be easily scaled up to protect the newly poor the education, health, nutrition, and agriculture sectors and vulnerable. to build human capital for children, through cash trans- fers, school feeding, and other programs. To help workers develop skills and enhance their own produc- Engagement Principles: tivity, partnerships are essential with sectors that focus Evidence-Based, Country-Tailored, on developing private �rms, ensuring access to credit and Collaborative and �nance, and providing training and vocational edu- cation. Together, these partnerships can build skills To realize the strategy’s goals and priority, World Bank programs, help workers connect to productive jobs, engagement with developing countries will need to and facilitate access to inputs and credits. be: evidence-based to generate knowledge of what works, tailored to country contexts, and collaborative Upholding core labor standards is central to protecting across a range of sectors and actors. workers and improving their productivity. In this area, it is vital to look at the determinants of child labor and EVIDENCE-BASED KNOWLEDGE unequal opportunity at work and explore the social OF WHAT WORKS protection and labor instruments that have been suc- Implementing this strategy will involve continuing the cessful, such as cash transfers that reduce children’s sector’s strong and sustained focus on knowledge work and women-focused labor market programs.11,12 generation and sharing. This strategy responds to three signi�cant knowledge gaps. First, knowing Enhancing productivity also calls for striking the right what exists—the availability of data on existing social balance between protection and competitiveness. protection and labor programs and systems is While recognizing the need for protection and equity, extremely uneven, being particularly problematic in social protection and labor policies need to be crafted fragile states and low-income contexts, and espe- so as to avoid disincentives, particularly with respect cially in Sub-Saharan Africa. This undermines to employment. performance management in client countries and among partners. Second, understanding results— FROM INFLEXIBILITY TO RESPONSIVENESS ongoing programs and systems are seldom carefully The recent food, fuel and �nancial crises vividly evaluated to assess whether they are performing as demonstrated the need for social protection and labor designed and achieving their intended impacts. systems that can quickly and effectively respond to Third, transmitting good practices about develop- those affected by systemic shocks and crises. ment effectiveness—there is still a gap in countries Countries without adequate systems in place were learning from each other about designing and imple- less able to respond effectively to protect the poor menting effective programs. and support recovery from shocks. Under the new strategy, the World Bank’s social A fundamental lesson is that social protection protection and labor teams will work collaboratively and labor systems are needed both in good times with partners to address these knowledge gaps by: to manage shocks to people and to address THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XVII ■ Strengthening client capacity for performance Progressively building social protection programs monitoring within and across social protection and systems that �t within a country’s �scal and and labor programs administrative capacity is vital. There is much to ■ Maximizing the availability and use of existing data learn, notably in tailoring approaches to low-income (such as the World Bank’s International Income and fragile contexts, where social protection and Distribution Database) labor systems will need to be developed within ■ Generating comparable, and accessible data on capacity constraints and where trade-offs are often social protection and labor programs (and, over most acutely felt in the face of pressing needs. time, social protection and labor systems) notably by strengthening in-country statistical systems BROADLY COLLABORATIVE PARTNERSHIPS ■ Making information on social protection and labor Social protection and labor systems are inherently widely available, consistent with the World Bank’s multisectoral—their instruments serve the Open Data initiative development objectives of other sectors, and social ■ Scaling up support for impact evaluations to protection and labor objectives need other sectors’ understand what works and what doesn’t in instruments to be realized. For example, conditional social protection and labor, with an initial focus cash transfer programs have been especially on cash transfers, public works programs, and successful at reducing poverty, along with improving youth employment both school attendance (especially for girls) and ■ Monitoring and evaluation will be complemented infants’ and children’s access to health services. by efforts to ensure that results flow back into Skills and training programs facilitate private sector improved policies and programs. activity by allowing �rms to expand with appropriately trained workers. Resilience for rural farmers can be Developing countries themselves are generating much ensured not only with cash transfers, but with of the most important knowledge about successes and instruments outside the social protection and labor failures in social protection and labor. A major theme of sector, such as healthcare, crop insurance, and this strategy is to ensure that this knowledge is broadly access to alternative markets (via roads and such available and used. The World Bank will use its technology as mobile phones). Creating comparative advantage as a global distiller, facilitator, opportunities for persons with disabilities requires a and customizer of knowledge to invest strongly in multisectoral approach to mainstreaming disability. South-South knowledge exchanges, notably in More broadly, social protection and labor fostering country-to-country knowledge exchanges instruments need an economy and a private sector among practitioners about effective design and that thrives and employs workers productively and implementation. provides opportunities for moving out of poverty. OPERATIONS TAILORED TO COUNTRY The work described above will require close CONTEXTS collaboration with key partners and stakeholders at Social protection and labor programs and systems global and country levels. In lower-income contexts, that the World Bank will help countries build cannot coordination among bilateral and multilateral be “one size �ts all.� Past experience shows that the agencies is essential to realize effective social best programs are led by the countries themselves protection and labor systems and make the best use and tailored to their contexts, while drawing from of IDA funds and other available �nancing. Agencies, global evidence of what works. including the World Bank, need to coordinate their resources and advice to avoid contributing to Social protection and labor programs are centrally fragmentation, and to help develop social protection aimed at family and individual behavior. Thus, social and labor programs to scale, rather than isolated and cultural contexts affect their outcomes, as well as pilots. They also need to generate catalytic funding the interaction of formal public and private programs for lower-income countries to build social protection with informal institutions. The implicit social contract and labor systems (as with the Rapid Social in a country will shape a social protection and labor Response Program, see Box 2) and encourage their system and its programs. long-term �scal sustainability. XVIII RESILIENCE, EQUIT Y, OPPORTUNIT Y Private sector actors are critical partners, not only to Second, political economy considerations may deter generate employment and growth, but often as direct governments and development partners from providers of social protection services or developers investing in coordinated, systemic approaches and of innovative solutions including information and may instead favor continued fragmentation or communications technology. At the country level, duplication of programs. Going forward, the World civil society organizations, trade unions, and faith- Bank’s policy advice to client countries, and dialogue based organizations are key actors in knowing the with partners, will thus emphasize both the value of challenges, shaping opinion, and representing inclusive and productive systems and good technical excluded groups. Effective social protection and solutions to achieve them. The World Bank will work labor policies will need open and mutual with partners to coordinate efforts and resources, with collaboration with all these stakeholders. a special focus on helping poorer countries build social protection and labor systems. Implementing the Strategy Third, moving to a systems approach depends on and Measuring Success countries’ abilities to develop their institutional capacities, especially across sometimes weak social To achieve the goals of this strategy, the World Bank, protection and labor agencies. Therefore, capacity developing countries, and partners will need to recog- building is a key component of the strategy, especially nize and mitigate political and institutional risks. First, in low-income and fragile contexts. This capacity despite the recent attention paid to social protection building includes the generation of accurate, useful, and labor during crises, governments may �nd it dif�- and timely data to improve results. cult to prioritize social protection and labor expenditures in better times, especially in the face of more visible investment needs and vocal constituencies. The strat- egy addresses this by assessing and building on what To realize effective social protection systems in lower- works in social protection and labor programs and income countries, bilateral and multi-lateral agencies systems, and combining this with knowledge access, will need to coordinate closely to address fragmentation. including intensi�ed South-South exchanges. Box 2 Preparing for the Next Crisis: The Rapid Social Response Program The Rapid Social Response (RSR) Program provides catalytic resources in relatively small amounts to help low- income countries (LICs) build social protection and labor systems, so that they are ready for future crises. RSR is based on the $61.7 millon trust fund resources donated by the Russian Federation, Norway, and the UK. This relatively small level of funding can effectively support system building efforts. In the medium to long run, it can also help to catalyze more resources as bene�ciary countries’ implementation capacity is upgraded. As of 2011, all initial funds have been fully committed, with Sub-Saharan Africa alone absorbing almost 50 percent of RSR trust fund resources. RSR is making a difference. The recently completed evaluation of Social Safety Nets (SSNs) by the Independent Evaluation Group (IEG) of the World Bank made the following observations, “…resources to support SSNs and institution building and to stimulate country demand were lacking in LICs. As additional funds were provided through the RSR ... engagement in LICs increased, and the Bank and countries focused more on institutional strengthening.� For the World Bank’s social protection and labor strategy, RSR is the central pillar for implementing the strategy; it calls on donors’ efforts to invest in social pro- tection and labor in low-income countries, and to help them prepare for the inevitable shocks to come. Source: www.worldbank.org/rsr. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XIX Finally, social protection and labor efforts need to be of the goals of social protection and labor and the sustainable, with cost-effective use of resources to strategy’s priority and principles (Table 1). meet country goals—given that resources are often wasted on ineffective programs. Accordingly, the The core strategic objective of moving from World Bank aims to continue to build the evidence fragmented programs to systems will be assessed that effective, inclusive social protection and labor using a new index of country social protection sys- systems do not have to be expensive or complex, and tem development, a measure of World Bank support to help countries select the most cost-effective to systems in lending operations and by the percent- approaches to meet their speci�c needs. age of co-�nanced IDA lending operations. Affordability in terms of pursuing cost-effective Each column in the results framework corresponds approaches and ensuring �scal sustainability is a to a speci�c are in the strategy. perennial challenge. Good systems are affordable: The Brazil Bolsa Familia program has demonstrated ■ Medium to long-term country progress on signi�cant results at a cost of around half a percent sector development outcomes directly related of GDP. The challenge of affordability often rests to resilience, equity and opportunity is the with making dif�cult policy choices about how to strategy’s ultimate objective. Though invest scarce public resources. However, a number measurability is dif�cult given data constraints, of countries have successfully reoriented and the strategy will make use of available indicators. organized available resources in support of stronger, For example, the �rst two measures on pension more effective systems. Ethiopia’s systems coverage are indicative of resilience. The other approach, for instance, channels national and global measures relate to equity and opportunity. partner funding into a closely orchestrated set of ■ Changes in country outputs and outcomes programs that have allowed it to mount an effective directly attributable to World Bank engagement response to the current drought in the Horn of will be assessed looking at a simple measure of Africa, in stark contrast to past experience and its the number of countries with which the World neighbors’ struggle with famine.13 Bank is engaged, as well as more challenging and ambitious measures of systems development In terms of affordability, the World Bank and its part- and investment loans’ contributions to expanding ners will need to support governments in prioritizing coverage of labor market and safety net cost-effective, scalable solutions that can be easily programs. implemented by existing institutions, including non- ■ World Bank activities supporting core elements of government partners. This needs to be applied to the strategy will also be assessed, including, making better use of existing resources, informed by project monitoring and evaluation given the strong detailed analysis of social protection and labor pro- focus on results, partnerships and knowledge gram �nancing (existing and projected), coupled with sharing through products as well as South-South commitments to increasingly move �nancing for social learning and mobilizing staff across regions. protection on-budget to strengthen the government’s oversight and accountability.14 The performance indicators chosen for the strategy reflect a pragmatic approach which recognizes the The new strategy will build on the World Bank’s dem- challenges inherent in tracking results well. Many onstrated strengths in social protection and labor. The indicators on important aspects of performance, World Bank’s comparative advantage lies in its ability such as the impact of World Bank knowledge work to combine in-depth country engagement with global or countries’ resilience, cannot be measured reliably knowledge exchange about effective social protection today. Others, such as those on systems perfor- and labor approaches, as well as the full portfolio of mance and partnerships, will need to be improved World Bank �nancing instruments. over time. The indicators selected reflect an empha- sis on data quality and availability, as well as The success of the new strategy will be measured coherence with World Bank and global approaches through a set of performance indicators reflective to tracking results. XX RESILIENCE, EQUIT Y, OPPORTUNIT Y Table 1 Social Protection and Labor Strategy Results Framework at a Glance World Bank activities to support Outcomes and outputs of coun- Country progress partner countries tries receiving World Bank on sector development support outcomes ■ Percentage of satisfactory projects ■ Percentage of social protection and ■ Share of working-age population (IEG Ratings) labor lending operations supporting accruing pension rights social protection and labor systems ■ Percentage of projects with ■ Pension bene�ciaries to elderly (>60) satisfactory M&E (ICRs) ■ Number of countries with social population ratio (old-age, survivor, protection and labor engagement disability, and social pensions) ■ Number of downloads of social protection and labor knowledge ■ Number of safety net bene�ciaries ■ Percentage of population in the products in IDA countries poorest quintile covered by social protection and labor programs+ ■ Number of countries involved in ■ Number of bene�ciaries of labor World Bank sponsored South-South market programs+ ■ Poverty gap at $1.25 per day (PPP) learning events ■ Percentage of children (7-14) ■ Percentage of social protection and employed+ labor staff time spent on cross- ■ GDP per person employed support to other regions ■ Youth/adult unemployment rate+ ■ Percentage of IDA lending operations having co-�nancing partners ■ Index of social protection and labor system development Note: +Disaggregated by gender; this matrix will be updated as appropriate to capture improved indicators as they become available, including on measuring the impact of knowledge services. Indicators will be regularly updated to capture improved their quality, track progress on strategy Greater resilience, equity, and opportunity are results, and highlight areas that need attention, essential for individuals and societies to prosper decision, and action. A mid-term update on the in the 21st century. The road ahead will be strategy is planned for 2017, which will include challenging, but this is a challenge that the a full review of the performance indicators. world’s nations need to take up. With this strategy, the World Bank aims to chart a course that makes it an even more effective partner in this endeavor. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY XXI XXII RESILIENCE, EQUIT Y, OPPORTUNIT Y 1. Resilience, Equity, and Opportunity: the Role of Social Protection and Labor The need for effective risk management is an and disability insurance, old-age pensions, and increasingly pressing concern for both people and scalable public works programs. Complementary societies. Global interdependence and risk—from programs in other sectors are also extremely such systemic shocks as economic crises or natural important for resilience—such as crop and weather disasters, to more idiosyncratic shocks, such as insurance and health insurance. Private and informal unemployment, disability, and illness—are central fea- arrangements (such as savings, assets, and family- tures of economic life in the 21st century. The poor are or community-based support) are vital, too. particularly vulnerable, because they are typically ■ Equity for the poor through protecting against more exposed to risk, have access to fewer risk man- destitution and promoting equality of agement instruments, and are less prepared to �nd opportunity.19 Social assistance programs (also good jobs and engage in productive work. Thus, for known as safety net programs—including cash men and women across the world who are striving to transfers and in-kind transfers, such as school improve their livelihoods, while addressing risks, feeding and targeted food assistance) address social protection and labor (SPL) enables them to chronic poverty. They also protect poor individuals manage these risks and have the opportunity to build and families from irreversible and catastrophic a better life for themselves and their families. losses of human capital (nutrition, health, and education), thereby contributing to equality of Consider some evidence. During the 2011 drought in opportunity.20 They also lay the foundation for the Horn of Africa, Ethiopia’s safety net program pre- equality of opportunity, notably by helping families vented many poor, food-insecure families from starving feel secure enough to invest in their future and through a combination of programs, including tempo- their children. rary employment and cash assistance.15 Turkey’s ■ Opportunity for all through promoting human conditional cash transfer (CCT) program protected capital in children and adults and “connecting� poor girls by allowing them to stay in school, advancing men and women to more productive employment. gender equality.16 And in the Dominican Republic, a Institutions that promote opportunity are often targeted job training program provided opportunities integrated with those supporting resilience and for disadvantaged young men and women to secure equity. Cash transfers incentivize investments in higher-paying and better-quality jobs.17 human capital by promoting demand for education and health and by helping address gender inequalities. Public works programs provide cash What is Social Protection payments to the poor, while increasing physical and Labor? capital investments. And labor market programs provide unemployment bene�ts, build skills, and Social protection and labor systems, policies, and enhance workers’ productivity and employability. programs help individuals and societies manage risk and volatility and protect them from poverty These goals are consistent with the �rst SPL strat- and destitution—through instruments that improve egy and the “3P� framework of prevention, resilience, equity, and opportunity.18 As such, SPL protection, and promotion used in the SPL litera- has three intertwined goals: ture (Figure 1.1).21 However, this framework builds on ■ Resilience against the impact of drops in well the more traditional SPL engagement in equity and being from a range of shocks. Key sources of resilience (mainly through social assistance and social resilience are social insurance programs that insurance programs) to put forward opportunity as a minimize the negative impact of economic shocks goal of equal importance and one that SPL instru- on individuals and families—such as unemployment ments can help achieve. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 1 This 2012-2022 World Bank Social Protection and are increasingly aware of these effects, and, therefore, Labor Strategy supports these goals and lays out are incorporating them into program design, although an agenda to help low- and middle- income countries successful models are not yet well established. build, improve and harmonize their SPL programs, to Evidence is more limited in other areas—such as the increase their capacity to respond to crises and role of SPL in improving savings, and the early evi- shocks, support poverty reduction and inclusive dence on how SPL can increase entrepreneurial growth, and build on the best global knowledge of activities by reducing downside risk.24 what works. SPL is increasingly recognized as a vehicle for These goals of resilience, equity, and opportunity ensuring social stability and implementing social cannot be achieved with isolated programs, within contracts to ensure that rights and state obligations a single sector, or through public mandates. are ful�lled and social cohesion strengthened, as Attaining them requires an appropriate policy, legal recognized in the prominent One-UN Social and institutional frameworks. Operationally, it calls on Protection Floor initiative. 25 SPL can be an important a portfolio of instruments, collaboration across eco- element in ensuring social cohesion during periods of nomic sectors, and the public sector working to rapid structural change (driven, for example, by demo- stimulate and complement private actors. graphics or migration) and in the face of crises. SPL can also help transform people’s lives and societies’ The government plays a role in setting the agenda capacity to meet important goals, including achieving for social protection in line with societal goals and resilience, equity, and opportunity. in overseeing the ef�cacy of SPL measures, be they public, private or informal. The state has a The strategy is ambitious and central to the World particular role to play when there are the inevitable Bank’ mission. For the World Bank, helping countries gaps in access—and when private measures fail to move from fragmented approaches to harmonized meet societies’ objectives resulting from, for instance, SPL systems—the main focus of this strategy—is failures in the markets for credit or insurance. central to its mission of poverty reduction through sustainable and inclusive growth. This strategy A lesser known feature of SPL is that it provides a outlines how this can be achieved during the decade foundation for inclusive growth, which can have a ahead, drawing lessons from a decade of global transformational effect on people’s lives (Figure engagement, and taking into account recent experi- 1.2). There is evidence that SPL programs supports ence with global economic crises and the guidance growth outcomes through �ve pathways: (i) building received from extensive external consultations. and protecting human capital; (ii) empowering poor individuals to invest or to adopt higher risk-higher Helping countries move from fragmented approaches return activities; (iii) promoting greater labor market to harmonized systems will be dif�cult and calls for mobility; (iv) acting as stabilizers of aggregate deepened engagement across sectors and actors. demand or enhancing productive assets and infra- However, the level of ambition reflects the level of need structure (for example, through public works for these measures, for effective means to allow every- programs); and (v) reducing inequality in society and one, especially the vulnerable, to protect themselves making growth-enhancing reforms more politically against risk and destitution and to seize opportunities. feasible.22 Indeed, the Growth Commission has writ- ten: “…if governments cannot provide much social protection, they may have to tread more carefully with Roles of Different Actors in their [growth-promoting] economic reforms.�23 Social Protection and Labor The strongest evidence on the relationship between The traditional domain of publically provided SPL SPL and growth is in improving the functioning of the programs includes the following: social insurance labor markets and thus improving access to produc- programs, such as old age and disability pensions; tive opportunities, and for allowing families to invest in social assistance in-kind or cash transfers that human capital. SPL programs around the world today serve as safety nets; and labor market programs, 2 RESILIENCE, EQUIT Y, OPPORTUNIT Y Figure 1.1 Social Protection and Labor Systems Operate at Different Levels Resilience Opportunity Insuring against Promoting human capital impacts of different shocks and access to productive work Equity Protecting against destitution Source: World Bank 2011b, derived from World Bank 2001, Bonilla Garcia and Druat ; ILO 2003, Devereux and Sabates-Wheeler 2004 and others. which help people �nd jobs or help workers In addition to being government-based, SPL enhance their skills or productivity. But traditional institutions can be informal (family or community- SPL instruments are not enough to achieve the based) or private and provided by �rms and goals of resilience, equity, and opportunity by organizations. Charitable institutions or worker remit- themselves. These goals require collaboration tances provide the bulk of poverty-reducing protective among a mix of public and private actors, transfers in many societies. The availability of good working across multiple sectors. schools and clinics are critical for the poor looking to improve their children’s human capital. Private �rms For instance, the provision of SPL is not just the are the most important vehicles for good jobs and domain of government social ministries. SPL is opportunity, and often invest in building skills of their carried out by a wide range of arrangements and workers. Informal social networks are often best for actors, using instruments from multiple sectors— youth seeking better opportunities to use those skills. including health, education, �nance, agriculture, and industry. Indeed, a central feature of SPL is being The case of jobs illustrates the roles of different multisector. For instance, agricultural crop insurance actors. As the forthcoming World Development provides resilience to farmers, as do savings from Report on jobs underlines, “jobs are the corner- microsavings schemes and rotating savings stone of economic and social development.�26 associations. From a SPL perspective, productive jobs are the main THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 3 Figure 1.2 SPL Contributes to Productivity, Growth, and Poverty Reduction INSTRUMENTS CHANNELS IMPACTS MACRO AND POLITICAL: NATIONAL ECONOMY Insurance contributing to broad economic growth ■ Promotes social and political cohesion, enables reform ■ Deepens capital markets: pension funds provide capital to stock and bond markets ■ Stimulates aggregate demand: safety nets provide countercyclical spending during downturns POVERTY REDUCTION ECONOMIC GROWTH Safety Nets MESO: LOCAL ECONOMY contributing to local economic development ■ Creates productive assets at the community level/infrastructure: public works ■ Improves functioning of the labor markets and job matching Labor Market ■ Creates local spillovers from increased demand stimulating investment and productivity Policies MICRO: HOUSEHOLD contributing to household productivity Access to ■ Accumulates and protects assets: through avoidance of distress sales of assets Services ■ Increases entrepreneurial activities: by reducing the cost of downside risk ■ Increases human capital: higher enrollment, improved skills, and reduced malnutrition MAKING SOCIETY MORE EQUITABLE THROUGH REDISTRIBUTION by avoiding destitution and longer-term poverty traps Source: Alderman and Yemtsov 2012, adapted from multiple sources. avenue for opportunity, affording people socioeco- that improve workers’ access to jobs, increasing nomic mobility, while mitigating risks through their capability to reap the best returns from work. adequate and secure incomes. But such jobs cannot Examples of this are labor regulations and institutions be sustainably created by SPL programs alone. For that protect workers, while allowing them to make that, a thriving private sector that demands labor and successful labor transitions—from school to work, or skills and fairly rewards workers for their productive between jobs. Other examples are programs that contributions is needed. This requires policies and facilitate training to ensure that workers’ skills match reforms that address market and government failures those demanded by employers—or ease the asymme- that inhibit labor demand—often the domain of those try of information that inhibit employers from �nding working in private and �nancial sector development, the right workers, or workers to �nd the right jobs. agriculture, and infrastructure. The broader jobs agenda, therefore, requires SPL For SPL, the jobs focus is on enhancing those to work in close collaboration with other sectors: policy reforms, and facilitating those interventions from investment climate and credit policy reforms to 4 RESILIENCE, EQUIT Y, OPPORTUNIT Y boost labor demand; to agricultural extension services One way to structure SPL approaches is by taking a that improve the productivity of farming; to educa- life-cycle approach to map demands to the portfolio tional programs that provide the right sort of learning of SPL programs (Figure 1.3). This example provides for the job market. an integrated lens, but there are many other ways to think of a program portfolio, including distinguishing by formal/informal sectors, different types of vulnerabilities, A Portfolio Approach to Social gender, poverty levels or urban-rural distinctions. But Protection and Labor the life-cycle approach illustrates well how programs targeted to particular demographic groups can serve A major challenge of effective access to SPL one or more of the goals of SPL—for instance, school is to ensure that programs—and ultimately the whole feeding programs protect school-age children, skills SPL system in a country—are responsive to the needs programs help promote opportunity by facilitating the of various groups and risks, drawing from a “portfolio� access of youth to productive jobs, and disability insur- of programs that together provide resilience, equity, ance provides resilience against the adverse income and opportunity to all who need them. consequences of an illness or accident. Figure 1.3 SPL Programs Work Dynamically over the Life Cycle to Provide Resilience, Equity, and Opportunity Equity: Social pensions Opportunity: Nutrition/ECD, CCTs for pre-school, health Resilience: Old-age pensions, Pregnancy, disability insurance Early childhood Equity: OVC programs, child allowances Opportunity: CCTs for Old age School age (girls’) education Opportunity: Employment Equity: Child services, entrepreneurship, allowances, school training and skills feeding Equity: Cash and in-kind transfers, public works programs Resilience: Unemployment, Youth Opportunity: Working age Youth employment disability insurance programs, skills training Source: World Bank 2011b. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 5 The SPL challenge for many developing There is no one design for a SPL program portfolio, and emerging countries is to progressively but dynamic links across programs matter. For develop a well-articulated, �scally sustainable, example, in the life-cycle approach, links across age and well-performing portfolio of SPL programs, groups mean that the effectiveness of programs cater- tailored to country circumstances and meeting ing to older populations will depend critically on the the needs of different groups. A typical developing success of programs that have helped the young. Early country may have several gaps in terms of serving child development is a crucial ingredient for resilience the different groups who need SPL programs—with across the life cycle—with adequate nutrition in infancy some having just broad poverty-targeted programs and early childhood being an important determinant of that may protect all age groups but not provide suf- whether children can escape poverty. Again, preschool �cient resilience or opportunity, while others have a stimulation and proper education is a major predictor of patchwork focused on the SPL goals but serving being able to avail of skills-building programs and other only a small group of the population (usually the promotion-oriented SPL programs later in life. And formal sector or urban populations), and yet others old-age income security is greatly enhanced if employ- have programs that do span the needs but are poorly ment-oriented SPL programs allow individuals to work performing in their ability to effectively deliver resil- productively, save, and contribute to their pension ience, equity, and opportunity. plans during their working life. 6 RESILIENCE, EQUIT Y, OPPORTUNIT Y THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 7 2. Lessons from the First Decade of World Bank Engagement in Social Protection and Labor The First Social Protection and Figure 2.1 Labor Strategy Share of SPL Lending: IBRD, IDA and The World Bank published its �rst SPL strategy in Grants (FY98-11) January 2001, emphasizing the growing importance of the sector for poverty reduction and reflecting the increased recognition that while growth and macroeconomic policies are fundamental for sus- IBRD tained poverty reduction, they are often insuf�cient. 68% The �rst SPL strategy established clear goals for the sector with a focus on (i) improving earnings opportuni- ties and quality of jobs; (ii) increasing security for households and communities through better risk man- agement; and (iii) improving equity and poverty reduction through assistance to vulnerable groups.27 These broad goals continue to guide the sector today. IDA Grants 31% A major contribution of the 2001 strategy was estab- 2% lishing Social Risk Management as a solid conceptual framework that identi�ed risk and vulnerability as one of the major drivers of poverty. Using the Social Source: Honorati et al. 2012, from World Bank business Risk Management framework, the strategy focused on warehouse. risk as a complement to the sector’s more common emphasis on basic needs and equity. This framework led portfolio for middle-income countries (MICs) to the introduction of vulnerability analysis as a comple- has been stronger than for other countries. ment to poverty analysis, and highlighted the importance ■ A central role in helping countries in crisis of public, private, and informal mechanisms. response, although again, with MICs being better able to absorb World Bank SPL During its �rst decade, the SPL practice evolved resources. around �ve main areas: labor markets and job cre- ■ Strongly performing projects and ation; pensions and old-age income support; social knowledge portfolios (additional information safety nets (SSNs); social funds; and disability. is available in Annex 4). A little more than a decade after its creation, the A Decade of Engagement in SPL sector today is well-established with a grow- Social Protection and Labor ing global presence, although with stronger engagement in MICs than in low-income countries The World Bank’s SPL portfolio has shown strong (LICs). From 1998 to 2011, the World Bank commit- growth in quality and quantity. It has evolved over ted about $30 billion28 to �nance SPL programs in the last decade to reflect three trends: developing and emerging countries, representing ■ A global presence with signi�cant about 7 percent of total World Bank-wide lending involvement in all regions, although the commitments.29 In FY11 alone, the sector committed 8 RESILIENCE, EQUIT Y, OPPORTUNIT Y over $4 billion in lending.30 Two-thirds of this lending Evaluation Group (IEG) reviews.32 SPL projects was directed to the International Bank for ranked satisfactory in 82 percent of cases, above the Reconstruction and Development (IBRD) countries, World Bank average of 76 and the average disburse- with a third flowing to the International Development ment ratio of SPL projects was 44 percent (against Association (IDA) countries (Figure 2.1). This stronger 21 percent for the rest of the World Bank) during historical engagement in MICs in SPL has encom- FY98-11. It peaked at 67 percent in FY10 because of passed both lending and analytical work and is high disbursement by crisis-related projects. Most consistent with broader World Bank engagement. recently, the IEG evaluation of the World Bank’s work on SSNs over the last decade concluded that “Bank Initially concentrated in a few regions, the SPL support evolved in positive directions over the sector portfolio is now established across regions, decade . . . Bank support has largely accomplished although still concentrated in MICs. Lending its stated short-term objectives and helped countries remains concentrated in the Latin America and achieve immediate impacts�33 (see Box 2.1). Caribbean (LAC) and the Europe and Central Asia Moreover, an IEG review of analytical and advisory (ECA) regions, which account for over 40 percent of activities (AAA) on employment highlights that they the lending today. But over the past decade engage- have been good quality, addressed the right issues, ment in Africa has steadily grown, the Middle East and been valued by clients,34 while a separate report and North Africa (MENA) and the South Asia (SAR) underscores the effectiveness of the work in influenc- regional practices have consolidated and lending in ing pension policies.35 Finally, IEG has frequently East Asia and the Paci�c (EAP) has increased in praised SPL’s impact evaluations.36 recent years based on country demand as well as on the establishment of a new sector practice in 2008. The SPL practice has forged a strong reputation as a knowledge producer, customizer, and connec- SPL lending has been cyclical, spiking in response tor. As knowledge producer, the SPL sector has to economic crises and price shocks. As reflected developed sound frameworks in each of its main prac- in Figure 2.2, lending has tended to peak during cri- tice areas and has been a leader in developing ses—such as in FY98 and FY99 when it doubled evidence on development effectiveness, which is compared to previous years, mainly because of the shown by the effective and widespread use of impact East Asia �nancial crisis.31 In FY09 through FY11, evaluations.37 The SPL sector has customized avail- largely in response to the global economic crisis, SPL able knowledge, helped connect clients, and lending increased �vefold, representing the largest translated in-depth engagement at the country level sectoral increase in World Bank lending over this into systematic global knowledge-sharing. period. This increase was based on strong client demand for scaled up safety nets, as well as unem- ployment and pension reforms policies and programs. Learning from the Past Decade: What is New about this Strategy? But lending in response to crises has been concentrated in a handful of main middle-income This SPL strategy builds on the achievements—as countries. The FY09-11 crisis-driven increase in well as the lessons—from practice and evidence lending was driven by IBRD countries, with many over the last decade and more. It continues the IDA countries unable to absorb resources for SPL basic analytical foundation of SPL: programs and in the absence of existing systems. Fifty four percent policies supporting risk management and protection of the increase in commitment went to �ve IBRD against destitution.38 It aims, as discussed, to consoli- countries, indicating that countries that had SPL date and deepen successful practice and addresses programs in place were more able to rapidly scale areas where there were shortcomings. But it is also up in the face of the crisis. stakes out new ground, learning from areas where the strategy was less successful. SPL lending and analytical portfolios have remained some of the best performing among The extensive consultations carried out to inform World Bank sectors, as underscored by Independent this strategy provided critical guidance to the THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 9 Figure 2.2 New World Bank Commitments to SPL, 1998-2011 ($ million) 40 35 30 25 20 15 10 5 0 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 Labor markets Social risk Other social Safety nets Social funds mitigation protect Source: Honorati et al. 2012, from World Bank business warehouse. World Bank for shaping the strategy (see Box 2.2 enhanced engagement across sectors and actors, and Annex 4). These consultations were central to and ensuring that SPL systems can adequately pre- con�rming the need to address fragmentation and pare countries to protect the vulnerable during crises. move toward a systems-focused approach to SPL It also calls for tailoring approaches to different institu- and to providing guidance to the World Bank for its tional and country contexts. SPL engagement in the years ahead. Second, the strategy underscores the need for Drawing from the IEG report on SSNs (Box 2.1), the increased engagement in LICs, both to help coun- Sector Strategy Implementation Update, the consulta- tries better serve their poor populations and to ensure tions, and numerous other sources, four areas emerge that effective systems are in place to be able to as needing strengthening in the new strategy, and respond to crises. This is an ambitious goal, and will thus key new areas of emphasis. not necessarily be marked by major increases in lend- ing (already at the World Bank average). The focus First, the new strategy brings a stronger will be on developing effective solutions speci�c to focus on solutions, underscoring the need country contexts, building both a knowledge base and to build coherent and country-appropriate operational experience, and helping lower-income portfolios of SPL programs—or SPL countries put in the appropriate building blocks that systems—that together help people deal can move them towards their SPL goals. It will not with multiple risks. This is built on the realization detract from attention to and engagement in MICs. that there is a need for greater coordination within and across the traditional SPL practice areas of Third, the strategy stresses the central role of jobs safety nets, pensions, and labor markets, as well as and enhanced productivity as the pathway to disability and results, in order to reduce fragmented opportunity. This is enhanced emphasis on an area approaches. The systems approach does not mean that has been a core practice in SPL. But this strategy diluting the World Bank’s technical depth and excel- crystallizes it by laying out the agenda for both opera- lence in each one of these practices. But it calls for tions and partnership—working with other sectors to 10 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 2.1 IEG’s 2011 Evaluation of World Bank Support for Social Safety Nets IEG had a predominantly positive view of the World Bank’s support for SSNs over the last decade, with the greatest acknowledgment for the way the practice has evolved over the most recent years. In its summary, IEG wrote: Bank support evolved in positive directions over the decade. The Bank began to move from a project-focused approach that emphasized delivery of social assistance benefits toward an approach that focused on helping countries build SSN systems and institutions to respond better to poverty, risk, and vulnerability. Stronger demand for SSN support in MICs led to significantly stronger engagement there than in LICs. However, the recent crisis-related expansion of support included also LICs and permit- ted initiation of Bank support in 15 new countries. The Bank’s support to SSNs throughout the decade has relied strongly on both lending and knowledge sharing to engage clients. The evaluation pointed to �ve areas for the World Bank to strengthen its practice: First, to engage during stable times to help countries develop SSNs. Second, to continue emphasizing building SSN systems and institutional capacity. Third, to engage more strongly in LICs. Fourth, to focus on results frameworks for Bank SSN sup- port. And �fth, to ensure strong cross-network coordination on SSNs. Each of these areas is underlined in the strategic direction and the engagement principles for this strategy for the SPL sector more generally (Sections 4 and 5). Source: IEG 2011a. expand the number and quality of available jobs, resilience, equity, and opportunity. In resilience, improving the ability of people to access these jobs the agenda will need to include crisis responsive- and livelihoods, and strengthening human capital as a ness to meet the needs of the new poor in addition foundation for productivity. to addressing the needs of the chronic poor. In equity, the World Bank has done well in targeting the Finally, the strategy highlights the central poor and establishing core programs, especially in importance of appropriate knowledge in SPL MICs. The new frontier is how to engage more effec- practice, especially through engendering a global tively in low-income countries and reform insurance South-South conversation about what works and programs to ensure sustainability and access, espe- how in SPL. cially to those in the informal sector. In opportunity, there is a concerted push towards a focus on pro- This diagnostic reflects the evolution of the World ductivity and access to jobs, so as to propel Bank’s engagement in SPL in the areas of individuals and households out of poverty. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 11 Box 2.2 Results of the Strategy Consultations The consultations around the 2012–22 SPL strategy engaged over 2,000 people worldwide to provide insight and guidance to the strategy formulation. Representatives from government, civil society organizations (CSOs), academics, the private sector, and bilateral and multilateral development agencies met with the World Bank in 64 face-to-face events worldwide, reaching over 1,700 participants from 66 countries. There were focused discussions with country clients and policy makers. Discussions were also held with key development partners—from global trade unions, to CSOs such as Save the Children, Help Age International and the Africa Social Protection Platform, to UN agencies including the International Labour Organization (ILO), the United Nations Development Programme (UNDP), the United Nations Children’s Fund (UNICEF), and the United Nations World Food Programme (WFP). Written comments were also received from several organiza- tions. The World Bank also convened an external SPL Advisory Group to marshal advice and insights from top academics, policy makers, and CSO representatives, and used an on-line forum to engage widely and transpar- ently across a range of stakeholders. There was a clear support for three directions where the World Bank can help countries build better SPL: ■ Focusing on SPL systems, especially to address fragmentation and incorporate crisis response, with a particular focus on a fiscally sustainable, country-led approach ■ Expanding SPL coverage, especially in low-income countries and fragile states, and to neglected segments of the population, with the caveat that this focus should not imply less attention to vulnerable populations in MICs ■ Promoting links to human capital, skills and labor market insertion, while recognizing that risk management, including resilience against the adverse impacts of shocks and protection of the poor remain central elements of SPL, and that there is a need to systematically connect the two areas The consultations called on the World Bank to play a role in �ve areas: ■ Generating and sharing evidence and knowledge on SPL ■ Building capacity ■ Financing SPL initiatives, both directly and by mobilizing others’ support ■ Supporting coordination across global partners, government agencies, and other actors ■ Listening and collaborating with others in setting and implementing the SPL agenda Note: For more detailed information on the consultations, see Annex 4. 12 RESILIENCE, EQUIT Y, OPPORTUNIT Y THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 13 3. Social Protection and Labor in Today’s World A Global Challenge, an Emerging poverty reduction and meeting the MDGs remain, but Consensus new challenges include “… the need to foster multi- polar growth; respond to complex global interactions; Increased interdependence, risk, and vulnerability and anticipate risks, potential new shocks, and are central features of today’s global economy. unpredictable crises.�42 Together with persistent poverty, relentless demo- graphic trends, and an ongoing economic crisis, This emerging global consensus is manifested they present an unprecedented challenge to SPL in numerous country actions and global initia- (Table 3.1). The recent global economic crisis has tives, including the prominent One-UN Social encompassed job loss, �nancial turmoil, and volatility Protection Floor Initiative (SPF-I), adopted by the in food and fuel prices. Demographic trends place United Nations Chief Executives Board in April aging at the top of the agenda in a number of coun- 2009 (Box 3.1).43,44 The SPL strategy and engage- tries, while the growing share of youth entering the ment is consistent with these core principles of the labor force presents an economic and social chal- SPF-I, particularly through the strategy’s emphasis lenge in others, as illustrated dramatically in the Arab on building inclusive, productive, responsive SPL Spring of 2011. Climate change is reshaping temper- programs and systems tailored to country circum- ature, precipitation, and epidemiology, while driving stances. The World Bank has been a strategic up the frequency, intensity, and variability of extreme partner in the One-UN Social Protection Floor ini- weather patterns.39 Acknowledging the heterogeneity tiative (SPF-I, and has an important role to play of challenges across regions, these overall trends are both in helping countries who sign on to the SPF-I predicted to have disproportionate effects on poor to operationalize it and in knowledge sharing. The regions and populations.40 World Bank has been engaged in extensive strate- gic dialogue at the global level and partnerships at These challenges are increasing risks to individuals the country level. The World Bank also contributes and families, while urbanization, migration and to the initiative through knowledge generation and modernization are changing individuals’ and fami- dissemination, developing data on the state of SPL lies’ traditional sources of resilience against these across countries, and knowledge-sharing concern- risks.41 A long-term increase in prosperity has wel- ing good practice and results in SPL. comed many to the rising middle-class, but many others—especially in lower-income and fragile con- texts—continue to confront deep poverty and inequality The Global State of Social and remain disconnected from opportunity because of Protection and Labor: Progress, a lack of skills, information, or �nance. This lack of but Fragmented Approaches access to opportunity affects human development outcomes and is a source of inequality. Persistent Numerous countries have augmented the cover- shortfalls for many remain in nutrition, education and age and ef�cacy of SPL, often with support from health, notably maternal and child health, underscored the World Bank. These countries include Mexico’s by lack of progress for numerous countries in reaching Oportunidades and Brazil’s Bolsa Familia programs the Millennium Development Goals (MDGs). of conditional cash transfers, which have inspired other countries around the world to design their own This challenge has crystallized into a growing programs to attain similar goals. China’s measures to demand for societies to mobilize SPL as a center- reform its hukou system and Turkey’s merger of its piece in responding to growing risk and persistent pension systems for public and private workers are poverty. As the April 2010 paper on post-crisis direc- signi�cant reforms that, as they unfold, could serve tions for the World Bank states, the challenges for as influential models to others. India’s Mahatma 14 RESILIENCE, EQUIT Y, OPPORTUNIT Y Table 3.1 A Changing World Indicator 1990 2000 2010 (1981–90) (1991–2000) (2001–10) Number of natural disasters (annual)1 181 322 438 Energy price index (constant 2005 US$) 58.49 37.77 97.12 Food price index (constant 2005 US$) 114.56 97.13 118.57 2 Poverty headcount ratio 45.6 35.8 27.9 Workers’ remittances (current US$, in millions)3 42,249 97,995 222,356 Mobile cellular subscriptions (in millions) 2.8 212.7 2,767.2 Source: Data adapted from the International Disaster Database, Center for Research on the Epidemiology of Disasters (CRED), and World Bank Commodity Markets and World Development Indicators (WDI). Note: 1. Global average values per decade; 2. Percentage of population in low-income countries (LICs) and middle-income countries (MICs) living under $1.25 a day (PPP); data available for 1981, 1984, 1987, 1990, 1993, 1996, 1999, 2022, 2005; 3. Workers’ remittances and compensation of employees, received. Gandhi National Rural Employment Guarantee pro- Fragmentation across programs is common in gram (offering 100 days of public work as a right to most countries, in MICs as well as LICs (see Box 3.2 poor rural households) and South Africa’s social on Vietnam). In MICs, there is typically a surfeit of pro- pensions are both being keenly watched by policy grams with similar objectives and overlapping targeted makers in countries interested in establishing social individuals and groups—such as similar programs tar- protection as a right. geting speci�c demographic groups (for example, women, orphans, youth, or the old) overlapping with Notably, advances in SPL programs are not limited programs targeting vulnerability or capabilities (for to large or middle-income countries. Armenia and example, poverty-targeted cash transfers or skills-build- Georgia, two countries with strong SPL programs, are ing programs). Larger-scale programs may exist, but IDA countries. Among island economies—Dominica, may not be coordinated, cost-effective, or able to fully Mauritius and Seychelles—have good SPL programs. reach all those who need them, deliver on program In Sub-Saharan Africa, SPL systems are being built in objectives, or respond effectively to shocks. a number of countries, including Ethiopia, Kenya, Tanzania, and Rwanda. The World Bank has been a In many lower-capacity or lower-income contexts, major partner for most of these efforts—in most cases fragmentation is especially acute and contributes to providing strategic and design advice, technical assis- coverage gaps. Programs simply do not exist at scale tance, or �nancing, and in others serving to distill and and often a collection of smaller unconnected efforts broker knowledge on these programs. focus on distinct regions, discrete groups, or speci�c objectives—and are unable to complement each other, However, across the developing world SPL today leaving large needy populations uncovered. As shown faces a major challenge: addressing fragmenta- in Figure 3.1 for Africa’s cash transfer programs, these tion—across programs, policies, actors and levels of programs may also be dispersed across different minis- government. Fragmentation hampers SPL responsive- tries. In Africa, global partners and nongovernmental ness and coverage, limiting its ability to ful�ll the goals organizations (NGOs) outside the government adminis- of resilience, equity, and opportunity. ter almost half of formal programs. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 15 Box 3.1 The Social Protection Floor The One-UN Social Protection Floor initiative (SPF-I), currently co-led by the International Labour Organization (ILO) and the World Health Organization (WHO) and endorsed by the UN Chief Executives Board, calls for an integrated set of social policies to provide income security and access to essential social ser- vices for all, paying particular attention to vulnerable groups. The core elements of the SPF-I are the following:45 ■ A basic set of social transfers, in cash and in kind, to provide a minimum income and/or employ- ment and livelihood security for the unemployed and working poor ■ Universal access to essential social services in the areas of health, water and sanitation, education, food security, housing, and others defined by national priorities While the design and implementation of national social protection floors will follow country-speci�c priori- ties, the Social Protection Floor sets forth a number of principles to be taken into account. These are outlined in the Report of the High Level Advisory Group to the SPF-I: ■ “Combining the objectives of preventing poverty and protecting against social risks, thus empowering individuals to seize opportunities for decent employment and entrepreneurship. ■ A gradual and progressive phasing-in process, building on already existing schemes, according to national priorities and fiscal constraints. ■ Coordination and coherence between social programmes; in particular and within a perspective treating human development on a life cycle basis, the floor should address vulnerabilities affecting people of different ages and socio-economic conditions, and should be regarded as a framework for coordinated interventions at the household level, addressing multidimensional causes of poverty and social exclusion and aiming to unlock productive capacity. ■ Combining income transfers with education, nutritional and health objectives, to promote human development. ■ Combining income replacement functions with active labour market policies as well as assistance and incentives that promote participation in the formal labour market. ■ Minimizing disincentives to labour market participation. ■ Ensuring economic affordability and long-term fiscal sustainability, which should be anchored in predictable and sustainable domestic funding sources; while noting that international solidarity in the form of cost-sharing may be needed to help to start the process in some low-income countries. ■ Coherence between social, employment, environmental and macroeconomic policies as part of a long-term sustainable development strategy. ■ Maintaining an effective legal and normative framework, so as to establish clear rights and responsi- bilities for all parties involved. ■ An adequate institutional framework with sufficient budgetary resources, well trained professionals and effective governance rules with participation of the social partners and other stakeholders. ■ Ensuring mechanisms to promote gender equality and support the empowerment of women. ■ Effective health financing systems to ensure access to needed health services of good quality� Source: ILO 2011a; ILO 2012; ILO and WHO 2011. 16 RESILIENCE, EQUIT Y, OPPORTUNIT Y Figure 3.1 Cash Transfers in Africa are Fragmented Across Ministries and between Government and Nongovernment Actors Social welfare or realted 35% 43 Outside government 45% Social security/labor 9% Other Health 4% Social Fund 4% 1% Education 2% Source: Garcia and Moore 2012. Box 3.2 Vietnam: Addressing Fragmentation and Modernizing SPL Currently, Vietnam has several cash transfer schemes aimed at alleviating poverty and vulnerability, which were developed largely on an ad-hoc basis and cost around 0.6 percent of GDP. Bene�ts are primarily targeted to remote and poor regions rather than toward vulnerable individuals and families. While the use of geographic targeting has been associated with reductions in the incidence of rural poverty, it has largely ignored urban poverty. In addition, the delivery of social assistance is hampered by weak institutional capacity at the level of district and commune (xã) governments where record-keeping systems are rudimentary, poorly integrated, and often not linked at the national level. As these programs face demands from growing numbers of bene�ciaries, Vietnam has found that they are too disjointed to be effective for many poor families. Vietnam also has many different active labor market programs (ALMPs)—focused on everything from training to counseling, labor export, and credit—which collectively cost about 0.08 percent of GDP. These programs were designed outside of a coherent policy framework and evolved independently in several government insti- tutions. Many of the programs target the same population groups, which creates duplication. Linkages with social assistance and social insurance systems are limited. Institutional and administrative capacity is hampered by inappropriate or poorly designed governance arrangements, inadequate monitoring and evaluation (M&E) tools, and a lack of linkages with the private sector. The government’s draft social security strategy for 2011–20 addresses many of the weaknesses in Vietnam’s SPL system. Its reform and agenda, in particular, includes broader coverage, providing access to basic goods and services to a larger share of the chronically poor and vulnerable (particularly to the informal sector) and link- ing social assistance to measures that help develop human capital. Source: Bender, Bodewig and Nguyen in Robalino, Rawlings and Walker 2012. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 17 Fragmentation is also present across the different bolts� subsystems that facilitate the core government ministries and other actors engaged business processes of SPL programs. These in SPL, including between national province-level include, for instance, bene�ciary identi�cation and community-level programs and across donors. systems and registries, targeting schemes, M&E This fragmentation usually results in a lack of inclusion arrangements, and contracting and payment as some vulnerable groups do not get protected, in a arrangements for providers. failure of coordination and cost-effectiveness, and in ■ The program level focuses on design and incentive traps as bene�ciaries have little motivation to implementation issues, both within a given program move across programs that are poorly harmonized. (the standard approach) and through synchronization across programs or integration of similar programs. Improving design of individual programs may include Addressing Fragmentation: the following: better targeting mechanisms for cash Moving to a Systems Approach transfer programs so that they reach the poorest or women; improved M&E in skills-building program so To effectively mitigate risks and foster opportunity, that their designs can be adapted to changing SPL programs need to be able to work together as employer needs; and parametric changes in a portfolio of complementary initiatives, under a pensions systems to make them more adequate and systems approach. 46 SPL systems are “portfolios� affordable. The additional step needed for a systems of coherent programs that can communicate with approach is better synchronization of programs—for each other, share common administrative subsys- example, with bene�ciary databases communicating tems, and work together to respond to risks and to with each other to be able to identify overlaps and deliver resilience, equity, and opportunity to the gaps in bene�ts, and coordinated eligibility population. These systems can be a mix of public and parameters across different types of programs (see private/informal SPL institutions—ranging from national Box 3.3 on the �ve “SMART� design features of social assistance programs to charitable actions, from effective SPL systems). informal remittances to private pension funds and ■ The policy level ensures policy coherence attuning �nancial institutions, and from Active Labor Market the entire portfolio of SPL programs to act Programs (ALMPs) to �rm-sponsored skills training. coherently in delivering national goals and social The government plays an important role in providing contracts. In many cases, the policy level driver is a SPL when private and informal mechanisms are insuf- general strategy for the SPL system, outlining a �cient in providing socially desirable levels of medium-term vision to improve integration and resilience, equity, and opportunity. The government coordination across programs and functions. This also has a clear role in supporting private provision vision could map the existing SPL programs and (and, in the case of some large formal actors, regulat- gauge their effectiveness in delivering resilience, ing them) to achieve these goals. equity and opportunity for the population. It could also examine incentive effects (such as incentives Strengthening SPL systems can provide a broad set to stay in inactivity or to overinvest in training) of advantages. Stronger SPL systems can enhance along with charting present and future �scal needs equity by providing individuals with the means to secure and sources of revenue. This would also make their rights. They offer ef�ciency, through better- trade-offs explicit, and clarify broader issues—such designed tax/�nancing arrangements, economies of as how to deal with failures in insurance and credit scale, and common platforms such as registries. They markets and information asymmetries—that may impart effectiveness, through harmonized incentives and need government interventions in SPL. The fewer unintended consequence on behaviors. operational implication of this vision, which ensures adequate SPL services to all who need them, A Systems Approach to SPL Involves Three Levels would be a set of activities that would build of Engagement (Figure 3.2) needed programs that do not exist, eliminate ■ The administration level is about building basic overlaps and redundancies among programs, and management, information, and service delivery ensure sustainable overall �nancing and tools. The focus in on developing the “nuts and administrative capability for the entire SPL system. 18 RESILIENCE, EQUIT Y, OPPORTUNIT Y Figure 3.2 Three Levels of Engagement for SPL Systems Administration level: Aim: Building basic subsystems to support one or more programs Program Program level: Program Admin. Aim: Improving design of existing sub- systems Program programs and harmonizing across portfolio of programs Policy level: Program Aim: Ensuring overall policy coherence across programs and levels of government Source: Robalino, Rawlings and Walker 2012 Box 3.3 “SMART� SPL Systems Five aspects are central to building well-functioning SPL systems. This is summarized in the acronym SMART: ■ Synchronized: Connected tools and programs, with overall policy coordination. This is the key “systemic� feature of a SPL system—to ensure that individual programs that impact different groups and risks can be harmonized. Coordination across actors and functions of resilience, equity and opportunity sup- ports a dynamic system, encouraging movement out of poverty and responding to different needs. ■ Measurable: Monitored, evaluated and adapted on basis of results. Careful M&E is important to see whether the desired results are being obtained—and, as importantly, evaluation results should be used to tweak or change design, as needed, to increase effectiveness. ■ Affordable: Cost-effective and fiscally sustainable. SPL systems should be fiscally sustainable today and tomorrow. Part of the solution is to design them cost-effectively, often targeting specific groups or interventions and then progressively expanding to other groups or risks as resources and capacity increase. ■ Responsive: React counter-cyclically to crises. The system’s program portfolio and financial structure needs to be able to scale up in times of shocks— either through new crisis-specific programs, or through designs that allow existing programs to include the newly eligible because of the shock. ■ Transparent and accountable: Well-governed, with clear rules, roles and controls. A systemic approach delin- eates clear rules of the game, defined roles for the various agencies and individuals delivering services, and tight controls to redress any departures from the rules and roles. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 19 CHALLENGES IN BUILDING SPL SYSTEMS Affordability is a perennial challenge in terms of Building effective SPL systems is a challenging task, pursuing cost-effective approaches and ensuring particularly with respect to securing political will and �scal sustainability. Although good systems are ensuring that approaches are affordable, well gov- affordable (the iconic case is that of the Brazil Bolsa erned, and results based. Familia program, which has demonstrated signi�cant results at a cost of around 0.5 percent of GDP), the Strong political leadership is often essential for challenge of affordability often rests with making dif�- building responsive SPL systems with an appro- cult policy choices about how to invest scare public priate design, high coverage, and effective resources. However, a number of countries have suc- harmonization. This is particularly true for SPL, cessfully re-oriented and organized available resources where political incentives and populism often argue in support of stronger, more effective systems. for either small, fragmented programs aimed at dis- Ethiopia’s systems approach, for instance, channels tinct slices of the population, or hastily devised national and global partner funding into a closely generous programs that may not be �nancially or orchestrated set of programs, which have allowed it to politically sustainable. And there remains some skepti- mount an effective response to the current drought in cism in intellectual and policy-making quarters about the Horn of Africa, in stark contrast to past experience the case for these programs, as well as concerns and its neighbors’ struggle with famine.47 about their affordability and effect on incentives. Development partners, too, can contribute to fragmen- A particularly thorny �scal issue concerns the tation by sponsoring speci�c SPL programs that present and projected �scal demands of existing speak exclusively to their own priorities. Strong and SPL programs. In many countries, the basic design visionary leadership, often at the highest level, is parameters of some SPL programs —particularly con- needed to cut through this set of incentives (Box 3.4). tributory pensions systems—are leading to actuarial Reforms spurred by crisis can also jumpstart the pro- imbalances, absorbing a large share of �scal cess. When this political leadership is absent, it is resources, and compromising sustainability. For exam- very dif�cult to craft a mandate and carve out accom- ple, in the transition countries of Europe and Central panying �scal resources. Asia (ECA), addressing the �scal sustainability of Box 3.4 Embedding Social Protection within National Priorities in Rwanda The Vision 2020 Umurenge Program (VUP) in Rwanda is rooted in the national development strategy, which includes a strong central government commitment to prioritize social protection as a tool in post-conflict recovery. VUP funds public works that provide employment to members of poor households with no land but can work, and provides direct cash transfers to poor households that have no land and cannot work. Global partners have aligned their activities with the government’s strategy, thus avoiding fragmentation. The govern- ment relies on its 2011 social protection strategy to advance its national goals of reducing social, economic, and structural weaknesses. According to this strategy, providing social protection to the whole population strength- ens the social contract between the government and its citizens. VUP complements a well-developed set of social programs, including universal health insurance (covering 91 percent of the population), free education, social transfers, such as a pension scheme, a program of support to survivors of genocide, and the “one cow per family� program. The administration of all these bene�ts and VUP is decentralized under the supervision of the Ministry of Local Government, Good Governance, Community Development, and Social Affairs. Over the next 20 years, the government aims to build a system that includes greater access to public services for the poor and vulnerable, and more participation of informal sector workers in the contributory social security system. Over the medium term, it aims to reinforce existing programs as well as establish a universal old age grant for people over the age of 65. The government currently allocates 5 percent of its budget to social protection. Source: European Union 2010. 20 RESILIENCE, EQUIT Y, OPPORTUNIT Y pension schemes is a �scal and social imperative, understanding of political economy issues, such as the given the rising costs of social insurance systems political visibility of stand-alone programs, and public coupled with a shrinking labor force, particularly in the perceptions of rights, obligations, and entitlements formal sector. Most ECA countries are discussing from SPL programs. Good governance need not deep parametric reforms to their pension systems to involve complex institutional or administrative struc- meet this medium-term threat. However, even with tures. As illustrated in the India and Malawi examples these reforms, it is likely that demographic factors will (Box 3.6), community mobilization can be used to dictate deep de�cits over the next four decades. strengthen accountability through participatory gover- nance approaches. Strengthening transparency and governance, both in administration and in oversight and controls, is Strong M&E systems are essential for effective central to building effective systems. As discussed management and �lling knowledge gaps—with earlier, in MICs and LICs alike, responsibility for over- their most powerful use being not accountability, seeing SPL programs is spread across a diverse mix of but adaptation. Second-generation impact evaluation ministries, with little horizontal coordination. Complex methods go beyond a “black box� approach of institutional arrangements, strong vested interests, and assessing whether or not a program was successful. weak accountability mechanisms limit the reform of Instead, they test the relatively effectiveness of differ- older programs and the establishment of new ones. ent program design features. This can lead to Thus, instituting well-governed SPL systems involves important changes in programs design to improve strengthening the “institutional architecture’� within and effectiveness. The example of Oportunidades in across programs, along with using effective “rules, Mexico demonstrates this—careful impact assess- roles, and controls� (Box 3.5). These structures and ments have inspired changes in program design that systems also have to be designed with a clear have improved the ability of the CCT program to Box 3.5 Rules, Roles, Controls—Governance in Social Protection As outlined in the 2004 World Development Report, governance is also about improving incentives for policy makers and service providers to ensure that they are responding appropriately to their mandate to deliver effec- tive public services, and strengthening citizens’ ability to hold policy makers and service providers accountable. Governance in social protection can be de�ned as the set of incentives and accountability relationships that influence the way in which providers are held accountable for their behaviors and ability to deliver services with quality and ef�ciency. Efforts to strengthen governance can be categorized into three broad areas: ■ Rules of the game that de�ne the context for accountability relationships among policy makers, provid- ers, and citizens. At the program level, this refers to the legal framework governing the SPL system, or individual program, including legislation and secondary regulations and operational guidelines, such as clear criteria for eligibility, entry, and exit from programs, and predictable and transparent mechanisms for setting bene�t levels. ■ Roles and responsibilities of actors involved across levels of government and institutions. Mechanisms for strengthening roles and responsibilities include establishing institutional relationships, clarifying job descriptions for providers, and putting in place performance incentives. ■ Controls and accountability mechanisms that help ensure that “the right bene�t gets to the right per- son at the right time.� Most social protection programs—especially cash transfer programs—require measures to ensure appropriate flows of information and of money. Control and accountability mecha- nisms include both measures on the supply-side, including veri�cation, M&E processes, such as audits, quality control mechanisms, spot checks, policies to ensure access to information, and formal grievance redress mechanisms. Accountability measures also include demand-side elements that involve citizens in oversight. These include engaging citizens in social audits, third-party monitoring, and information pro- vision through report cards. Source: Bassett et al. 2012. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 21 Box 3.6 Using Communities to Enhance Accountability: India and Malawi Social audits are an important feature of India’s National Rural Employment Guarantee Act (NREGA) and have contributed to increasing the program’s accountability and transparency. The Act mandated regular social audits of all aspects of the NREGA scheme to review of�cial records and determine whether the reports made by the states on their expenditures are consistent with the money that was actually spent. An important innova- tion in this process has been the JanSunwai or public hearing, through which of�cials are directly accountable to citizens. The government also plans to introduce an Ombudsman program in which the NREGA scheme will be subject to “independent monitoring by eminent citizens.� Malawi’s Social Action Fund Project 3 (MASAF) uses a comprehensive community scorecard process to assess whether services are bene�tting the poor and to solicit responses from public agencies. The process gives com- munities a central role in assessing the performance of services and public agencies and in providing citizen feedback to service providers on their performance. Similarly, the service provider or the agency being assessed performs a self-assessment based on the perceptions of staff or people working in the agency. A meeting is then held between the service provider and the community where common concerns are discussed and a joint action plan for reform or improvements in the service are agreed. Source: Andrews et al. 2012. improve children’s school attendance and learning. Africa—typically have fewer bene�ciaries of SPL trans- Mexico has also been a leader in developing perfor- fers (Figure 3.3). This is partly because SPL programs mance management systems through its establishment are fewer and less effective, but also because those of the National Council for the Evaluation of Social SPL programs that exist are often available only to Policy (CONEVAL), an autonomous agency respon- urban populations or those with formal sector jobs. sible for monitoring poverty and assessing the performance of social policies and programs. Setting up inclusive, effective SPL systems in low- income countries is particularly challenging. SPL Taking a more systems oriented approach is a systems are needed to address poverty, acute vulner- frontier agenda, but one with tremendous poten- ability, and crises—each of which are disproportionately tial payoffs, particularly with respect to three concentrated in LICs and often conspire to keep or persistent gaps: providing adequate coverage, both drive households into destructive coping responses. within and across countries, improving responsive- This is combined with restricted �scal space and ness of programs to accommodate those made newly limited institutional capacity. For example, Timor vulnerable because of systemic shocks, and effec- Leste’s SPL transfers only reached 27 percent of the tively connecting bene�ciaries of SPL programs to poorest �fth of the population in 2007; Afghanistan’s productive opportunities. reached 15 percent in 2007; and Cambodia’s reached only 2 percent of the poorest in 2008 (all latest available data). Contrast this with SPL transfers Leveraging Systems to Address reaching well over 90 percent of the poorest �fth in the Coverage Gap: From Mongolia (latest data from 2007), Thailand (2009), Exclusion to Inclusion Romania (2008) Latvia (2008) and Chile (2009).48 SPL programs need to be available to all, but lack Fragile contexts present both challenges and of coverage remains a pressing issue across opportunities in terms of implementing SPL. On the countries and among populations, with the poor- one hand, they face greater challenges, including the est often being the least served. Countries with a existence of additional vulnerable groups, such as dis- larger share of the poor—especially in Sub-Saharan placed populations, ex-combatants, people disabled by 22 RESILIENCE, EQUIT Y, OPPORTUNIT Y war, and widows and orphans. When this is combined There are also important gender dimensions to with limited state capacity and an insecure environ- SPL, relating to different access to informal and for- ment, it can affect both the supply of and demand for mal mechanisms to access opportunity or cope with SPL and other services. On the other hand, SPL pro- vulnerability and shocks. First, in many developing grams have the potential to help stabilize fragile countries, women still have less access to education, situations. The World Development Report 2011: systematically lower earnings, and weaker access to a Conflict, Security, and Development (World Bank range of assets and productive resources (such as 2011) lists social protection as one of the options that land or credit) than do men.49 This means that women can be successfully introduced and incrementally often have less capacity to protect themselves in the increased in fragile and postconflict countries. event of shocks. Second, the impacts of shocks on women and men are almost always different, partly The informal sector presents another set of chal- because of the different areas of work typically per- lenges to inclusion. Within many countries, formed by women vis-à-vis men.50 During the recent traditional contributory social insurance programs, global �nancial crisis in Cambodia, for example, the such as old-age pensions and disability, and unem- external demand shock led to considerable labor mar- ployment bene�ts, as well as many ALMPs (such as ket churning, where a high destruction of jobs was skills training) only bene�t formal sector workers. They followed by an even larger creation of low-quality exclude the informal and agricultural workers who are employment. Women accounted for the greatest a large share of the population. Many programs are share of job losses, but also were the largest share of not available to those who are most in need—women, new workers in agriculture and the informal sector.51 the disabled, the illiterate, the urban homeless and More generally, female health has been found to be itinerants, the destitute, older people living alone, more susceptible to shocks in developing countries those who are socially excluded, and those who live in than male health.52 Third, women and men may have remote areas. different ways of pooling risk, not necessarily with Figure 3.3 Most of the Population in Africa, MENA, and South Asia Receive Little in the Way of SPL Transfers Coverage of Social Protection and Labor, by Region 100 3 5 2 13 13 90 23 80 12 17 27 33 46 70 9 60 21 Percent 50 40 22 43 75 70 30 65 20 46 32 10 22 0 Sub-Saharan Africa Middle East - North Africa South Asia Latin America - Caribbean East Asia - Pacific Eastern Europe - Central Asia No transfer Only social Only social Labor market insurance assistance programs Source: World Bank Social Protection Atlas, using household survey data from 64 countries. Data excludes remittances. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 23 other household members. In Ghana, for example, risk This is especially true for poorer countries without SPL pooling appears to be gender speci�c, rather than programs in place. By the end of 2010, the crisis con- household speci�c. Women pool risk with other tributed to an estimated 64 million additional people women in their villages, while men pool risk with a living below $1.25 a day and 76 million more below $2 more geographically diffuse group of men.53 a day, compared to a scenario where the pre-crisis trend of economic growth (during 2000–07) continued Children and the elderly are also often inadequately for developing and emerging countries. This is on top covered. Traditional, family-based care of the very of the 130 to 155 million people pushed into poverty in young or elderly has broken down in many developing 2008 because of soaring food and fuel prices.56 Even countries, without adequate formal mechanisms arising those living in more prosperous countries need effec- to take its place. Death, disease, and limited productive tive SPL institutions—to mitigate welfare losses from employment have impacted caregivers’ capacity to economic downturn and to capture opportunities for provide children with adequate stimulation, nutrition, recovery. This translates into an important operational health, and schooling—handicapping them for achieving agenda for building inclusive systems, as discussed productive futures (see next section). below. It also calls for coordination with the IMF and others engaged directly in crisis response. For the elderly, inadequate transfers from either formal pension systems or from informal family and community A central lesson from past SPL engagement is transfers can severely reduce their ability to cope with that systems must be built in “good� times in illness or inadequate nutrition. In LICs, only one in nine order to able to respond to crises. This was under- workers contribute to a pension program, and this scored by IEG’s 2011 evaluation of safety nets.57 proportion has remained stagnant for decades, affect- Given the lack of such systems, particularly in LICs, ing their ability to receive adequate pension bene�ts.54 there is an urgent need to have programs and �nanc- ing that can respond rapidly and effectively. In Public spending on pensions tends to be regressive, particular, the advantage of having instruments being concentrated on a very small proportion of already in place resides in their “automation�—that is, workers, especially civil servants. In MICs, there are their ability to be automatically triggered or adapted also large gaps among the lower income, informal (increasing the level of bene�ts and/or thresholds for sector workers—even for the higher-income MICs. eligibility) in period of crisis.58 This is compounded by demographic pressures straining the ability of pensions systems to �nance Social protection and labor systems are both adequate bene�ts. This is particularly true in the tran- needed in times of crisis to protect the vulnerable sition economies in Eastern Europe and the Former and poor, and in good times to manage individual Soviet Union, where pension spending is frequently shocks to people and families and to address long- the largest government expenditure as well as a major term poverty and lack of opportunity. However, source of �scal de�cits, and accelerated aging has practice differs across the world. In some regions, such reduced the number of younger workers supporting as Latin America, the emphasis has been on the role of those older workers needing pension coverage.55 social protection programs to reduce inequality and poverty. But these programs, very successful at target- ing the chronic poor, have been less able to identify Leveraging Systems to Address and serve the newly poor during broad crises. In other the Flexibility Gap: From regions, such as East Asia, there has been a focus on Inflexibility to Responsiveness crisis response, but many countries have yet to put in comprehensive systems that help households and The recent crisis vividly demonstrated the need for individuals meet their day-to-day risks. social protection and labor systems that can quickly and effectively respond to those affected by sys- Moving to more crisis-responsive SPL systems temic shocks and crises. Countries without adequate requires concerted action by countries during systems in place were less able to respond effectively “good times� to build resilience into their broader to protect the poor and support recovery from shocks. SPL systems. This requires investment in four areas: 24 RESILIENCE, EQUIT Y, OPPORTUNIT Y First, investing in SPL programs for the most productivity or create incentive problems that can vulnerable—to ensure that there are longer-term have a negative effect on productivity. Access to programs and broader social protection and labor social insurance, for instance, can facilitate labor systems in place before crises hit, and to immediately mobility and provide incentives for engagement in be able to address the needs of the most vulnerable higher risk/higher return activities. By contrast, when in the population. This is particularly needed in many programs are not properly designed, they can pre- lower-income countries, where large parts of the pop- clude labor mobility or provide incentives to work in ulation could become desitute because of price the informal sector. shocks or natural disasters. There are three core elements of addressing the Second, enhancing existing programs so that they opportunity gap in SPL: �rst, ensuring investing in can more easily capture the newly vulnerable. This the human capital of children; second, activating would, for instance, examine the eligibility mecha- individuals, especially youth, and improving the func- nisms in programs used to identify the vulnerable, and tioning of labor markets to include them; and third, to see if there are mechanisms to identify the newly improving the earning opportunities of workers, espe- poor. This can involve recourse and appeal mecha- cially through building their skills and productivity. nisms (where those who feel that they are unjustly excluded can get a quick resolution) or the use of First, building and preserving children’s human communities to identify the newly vulnerable. capital is a prerequisite for future productivity and for breaking the inter-generational cycle of Third, adding counter-cyclical programs to the SPL poverty, but is compromised by poor health, portfolio—such as public works and unemployment education, and nutrition, which can be exacerbated insurance—that can be easily scaled up to protect the during crises. SPL has an important role to play newly poor and vulnerable. For example, the Ethiopia across sectors in helping families invest in their Productive Safety Nets Program has a component children, providing a basis for ensuring equality in that allows it to be scaled up if there is warning of opportunities. For example, CCTs combine immedi- impending drought, which was used to protect addi- ate income support with incentives for families to tional bene�ciaries during the 2011 drought in the invest in their children’s health and education by Horn of Africa. requiring school attendance and health visits (see Box 3.7). Programs that are sensitive to speci�c Finally, �nancing for crisis response needs to be a vulnerabilities and reach orphans, street children, or central part of planning ahead. Coordination with part- pregnant women can help ensure that the youngest ners, including the IMF, is essential. There is also are not the most at risk. scope for expanding the use of rapid-response lending instruments and establishing insurance mechanisms, Developing child-sensitive social protection is also including across countries such as the development of particularly urgent given poor children’s vulnerabil- insurance against natural disasters in the Organization ity, the high returns on investing in children, and of Eastern Caribbean States (OECS). the consequences of inaction. Investing in children is broadly acknowledged to be one of the best path- ways for reducing poverty by reducing the Leveraging Systems to inter-generational transmission of poverty. The evi- Address the Opportunity dence on both the cost-effectiveness and Gap: Towards More consequences of deprivation in early childhood is also Productive Programs clear. These deprivations have lifelong impacts on cognitive development, health, and earnings. A well-functioning portfolio of SPL programs Conversely, investing in early childhood is among the can help improve productivity and longer-term most cost-effective use of resources.59 Forty-eight growth in incomes. However, many programs—in percent of children in South Asia and 42 percent in social assistance, insurance, or labor—have design Sub-Saharan Africa are malnourished and access to problems that either fail to maximize their impact on education and health remains elusive for many. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 25 Box 3.7 Conditional Cash Transfers: Protecting the Poor and Providing Opportunity Conditional Cash Transfer (CCT) programs have rapidly become one of the most widely adopted anti-poverty initiatives in the world, growing from a handful programs in the late 1990s to presence in over 40 countries worldwide today. CCTs are viewed as an effective way to provide basic income support to poor families while strengthening children’s health, education, and nutrition—a cornerstone for breaking the intergenerational cycle of poverty. CCTs provide money to poor families—usually through payments directly to mothers—conditional upon investing in their children. Typical family ‘co-responsibilities’ include perinatal care for mothers; regular check-ups, vaccinations, growth monitoring for children under �ve years old, and school enrollment and attendance for school-age children. Evaluation evidence from a number of countries points to considerable achievements. First, CCTs are effective in reaching the poor and have helped raise their consumption and reduce poverty, with bene�ciary households spending a larger share of their income on food and buying more nutritious food. Second, disincentive effects on adults’ fertility or labor market participation appear to be small or nonexistent, while having positive effects on child labor in Brazil, Cambodia, Ecuador, Mexico, and Nicaragua. Third, CCTs have substantially increased poor families use of education and health services—school enrollment and attendance has increased and families are more likely to bring children for regular health check-ups, growth monitoring, and vaccines. The impacts are strongest among the poorest and those with lower initial baseline levels. However, evidence on the impact of CCT programs on “�nal� outcomes is less clear-cut in areas such as child health and nutrition, school completion, and student learning. This suggests that there are important complementarities to be sought with programs that can affect children’s education and health, notably through early childhood devel- opment and by improving the quality of schools and health care. There are important remaining knowledge gaps currently being explored in a new generation of programs and related evaluations. One question is whether the cash or the condition matter more to outcomes, and whether similar outcomes could be obtained through unconditional cash transfers (UCTs). There are also design ques- tions, including around transfer sizes, how to best monitor conditionalities, and how to combine CCTs with complementary services to ensure long-term poverty and human development impacts. CCTs are not the only way to effectively combine poverty-reducing transfers with investments in children. Other approaches—including UCTs—can also be successful. But the unique record of CCTs is built on strong evaluations demonstrating success around the world and in different country contexts—an agenda of evidence- based implementation that other SPL interventions can do well to emulate. Source: Fiszbein and Schady 2009. 26 RESILIENCE, EQUIT Y, OPPORTUNIT Y Protecting and promoting human capital can be individuals have and those that are needed by employ- particularly important—and challenging—in the face ers. In Tunisia, more than 50 percent of university of crises.60 Infant mortality can spike during crisis—by graduates are in jobs that do not use the skills they one estimate, a 1 percent shortfall in per capita GDP acquired in university.64 The majority of the world’s from expected trends results in an increase in infant workers have very low levels of education. Even those mortality of between 10 and 15 percent.61 The mortal- with higher degrees might not have acquired the skills ity of girls is also signi�cantly more sensitive to necessary to succeed in the labor market— particularly aggregate economic shocks than that of boys. A high level analytical and interactive skills.65 Across range of studies point to the effects of idiosyncratic countries, only very few graduates attend top schools and aggregate shocks on mothers’ anemia, child birth and get access to good jobs. Compensation for these weight, child stunting, child underweight and wasting, lucky few has been on the rise—but for others, job and child anemia. In these cases, SPL and other opportunities are scarce and labor earnings have social services can play a key role. For example, remained stagnant. At the same time, employers fre- Indonesia implemented a supplementary feeding pro- quently complain that workers’ skills are a binding gram aimed at maintaining the nutritional status of constraint to their business. children under �ve years old, with a particular empha- sis on children under two, in the face of its 1997 An effective approach to skills will often involve crisis. The program had a signi�cant effect in prevent- rethinking current training policies often focused on ing stunting (low height for age) among infants, with supply-driven technical vocational education and train- longer exposure to the program resulting in ever ing or on the provision of ad-hoc incentives for on the greater protective effects.62 Thailand’s expansion of its job training. Countries will need to build on the experi- social insurance program was also instrumental in ences of countries from Turkey, Tunisia, Jordan, the combating a decline in access to health care in the Dominican Republic, and the suite of Latin American 1997–98 crisis.63 Jovenes programs, which engage the private sector to provide training and work experience to youth. A chal- Second, jobs are a critical aspect of the lenge would be to adapt these programs to LICs. opportunity agenda, and a SPL focus is activating individuals, especially youth, and improving the In addition, countries need to consider policies functioning of labor markets to include them. to the self-employed. Self-employed individuals— These are interventions that are particularly relevant including those working at poverty or near-poverty for MICs. The goal is to use well-conceived incentives levels—are the majority of workers in many LICs. and active ALMPs to increase participation rates, help They are often in activities with unrealized economic connect the unemployed to jobs, and facilitate transi- potential. This is due to constraints not only in terms tions between jobs. of skills but also because of lack of know-how, information about markets, and potential clients, Youth transiting from school to work are an impor- and access to credit. Labor market programs that tant target group for these policies and programs, provide comprehensive packages that address these which in addition to training can include counseling, multiple constraints, and connect the self-employed job-search assistance, intermediation services, skills to other opportunities, are important aspects of certi�cation, and wage subsidies. improving their productivity. Third, SPL interventions also aim to improve the Enhancing productivity is a challenging objective. It earning opportunities of workers, especially calls on multisectoral engagement and on building through building their skills and productivity. knowledge in terms of the best way to design and Interventions are needed to focus on building the implement programs that can address these con- skills of those who are already in the labor market—to straints. Going forward, this is an important area for address the persistent mismatch between the skills research, policy analysis, and operational innovation. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 27 28 RESILIENCE, EQUIT Y, OPPORTUNIT Y 4. Strategic Direction for Social Protection and Labor at the World Bank The central challenge of fragmentation and the global Deepening engagement in LICs and fragile contexts gaps in coverage, responsiveness, and opportunity will be needed to develop sustainable, effective identi�ed in the previous section establish a clear approaches in these contexts. They will need to be strategic direction for the World Bank’s SPL practice more responsive, to ensure that people can protect in the years ahead. their incomes and the welfare of their families during crises and shocks. And to ensure that people are able The primary objective of the World Bank’s SPL to access opportunities, SPL systems will need to be Strategy 2012–22 is to help countries move from more productivity-oriented, supporting human capital, fragmented approaches to harmonized systems to productivity, and longer-term growth in incomes. cover multiple risks and ensure more effective coordi- Enhancing productivity calls for a particular focus on nation across SPL programs and objectives. Building children, as well as on productive jobs for all workers. on growing empirical evidence and a decade of oper- Upholding core labor standards, including child labor ational experience, this strategy lays out an approach standards and equal opportunity at work, is a central for increasing World Bank involvement, capacity, and area of this broader agenda, which relies on working knowledge where there are critical gaps that a more multisectorally to help ease the multiple determinants of harmonized, systemic approach can help �ll. This is child labor and unequal opportunity at work. central to SPL responsiveness to shocks and to com- bating chronic poverty and destitution. A more harmonized approach is also needed to reduce cover- Strengthening Systemic age gaps in low-income countries or fragile contexts Approaches and for vulnerable groups (including the very poor, women, and the disabled) and to promote opportunity TAILORING TO COUNTRY CONTEXTS through enhanced human capital, better jobs, and SPL programs need to be able to work together as higher productivity, especially for young people.66 a portfolio of complementary initiatives adapted to different contexts, as described in Annex 1 on how Through policy dialogue, operations and knowl- different World Bank regional practices will apply the edge work over the next decade, the SPL practice SPL strategy to meet the particular needs and condi- will help countries move from fragmentation to a tions of their client countries. There is no “one size �ts systems approach, treating SPL as a portfolio of all� approach. Instead the strategy calls for improving programs. A portfolio approach will allow SPL pro- evidence, capacity building, and knowledge sharing grams to be more responsive to shocks that may be across countries to facilitate building appropriate caused by sudden calamities within the family—a loss portfolios of programs, tailored to country contexts of job, illness, or the death of a breadwinner—or the (see Figure 4.1). effects of more widespread crises. It will also help SPL focus on the core functions of alleviating poverty First, in weak institutional settings, such as and protecting against destitution. in fragile and lowest income countries, the appro- priate focus may be on setting up one Given the state of SPL today, the World Bank’s or more basic programs and ensuring that these practice will also need to focus on addressing the are supported by strong, basic administrative sub- inclusion, responsiveness, and productivity gaps. system “building blocks� that can be used across SPL systems need to be more inclusive, reaching SPL programs. This effort could start with establish- excluded groups to ensure their access to SPL, nota- ing and strengthening the basic building blocks of bly among the most vulnerable, the informal, and the speci�c SPL programs that cover only the most vul- disadvantaged (including women and disabled). nerable (usually transfer-based safety net programs). THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 29 Figure 4.1 Building SPL Systems Appropriate for Different Institutional Contexts Not fully connected set of well-functioning SPL programs, and good capacity Several functioning SPL programs, but Policy coordination fragmented, with limited capacity to coordinate to ensure efficiency, equity and incentive compatibility Improving efficiency and efficacy of each program, improving coordination Few or no functional formal SPL programs Building the “nuts and bolts� sub-systems to provide one or more SPL functions It could then progressively build administrative, institu- policies to build consistent, harmonized national sys- tional, and �nancial capacity to systematically and tems. This is important in three dimensions: �rst, systemically extend these to cover more people and across similar programs (for example, poverty-oriented to add, as needed, complementary programs to the cash transfers targeting different demographic SPL portfolio (such as old-age pensions, child ben- groups); second, across different types of programs e�ts, and disability bene�ts). (such as linking unemployment bene�ts to training programs—the “activation� agenda)67 to enhance com- Second, where there are several functioning pro- plementarities and avoid incentive problems; and grams already, the goal would be to improve the third, coordinating across actors and different levels ef�ciency and ef�cacy of each program—through of government, notably in federated countries (for re�ning institutional frameworks and improving incen- instance, ensuring coherence and compatibility tive compatibility with other related programs. This type between federal and state-level unemployment bene�t of engagement will be at the center of much of the criteria) (see Box 4.1 on Brazil). World Bank’s SPL engagement in client countries. Responses will also need to be tailored to coun- Third, in contexts where many individual programs tries’ particular priorities and needs, be they youth are well-functioning, the added challenge may be unemployment, a rapidly aging population, a high to improve their harmonization and coverage. degree of informality, severely constrained �nancing, Improving harmonization is an important “second-gen- or other issues. In many cases, the World Bank’s eration� agenda in many MICs, which the World Bank comparative advantage will lie in transmitting its learn- will continue to support with analytical and �nancial ing from interventions and programs among contexts instruments. A key feature of these reforms is syn- with similar institutional constraints, regardless of the chronization across existing tools, programs, and region in which they are situated. 30 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 4.1 Brazil: Bolsa Família and the Impact of Integrated Social Assistance Social protection policies in Brazil are credited with helping to dramatically reduce poverty and inequality over the past decade. Moderate poverty fell from 26 percent of the population in 2003 to 14 percent in 2009 and extreme poverty was halved from 10 percent to 5 percent (Soares 2010). Inequality also fell from a Gini coef- �cient of 0.59 (among the highest in the world) to 0.54. A major contributor to this was the government’s flagship social assistance program, Bolsa Família, launched in 2003 and integrating several existing social assis- tance programs, including Bolsa Escola (which targeted primary and secondary education), Bolsa Alimentacao (nutritional needs for women and children), Cartao Alimentaçao (food security), and Auxilio Gas (subsidies for cooking gas). Collectively, these existing programs had consumed almost a fourth of all spending on social assistance and had similar goals, but suffered from insuf�cient policy coordination, overlapping target popula- tions, and separate administrative arrangements. This created inef�ciencies in service delivery coupled with duplication and gaps in coverage that Bolsa Família was designed to address. Bolsa Família is a CCT program that provides monthly payments to mothers from poor families conditional upon investing in their children. The following are required: school enrollment and attendance; regular health check-ups, vaccines and growth monitoring; and mothers attending seminars on nutrition, health and educa- tion. The program has allowed for greater cohesion and continuity in social policies and has expanded coverage to some 13 million families today, more than a quarter of Brazil’s population. At a cost of 0.6 percent of GDP today, Bolsa Família provides coverage to more poor and extremely poor families than does any other CCT pro- gram in the world. Recent analysis points to Bolsa Família contributing to roughly one-�fth of the reduction in Brazil’s 2003-08 poverty rates and income inequality. The program has also contributed to increased educa- tional enrollment and attendance, as well as the utilization of health service providers. Much of Bolsa Família’s success is credited to its effective administrative procedures. A database, the Cadastro Único, is used to compile, manage, and analyze data for 22 million families, a large share of Brazil’s poor. The ongo- ing assessment, revision, and adjustment of procedures to identify and register families have helped minimize errors both of inclusion (that is, bene�ts to those who do not need them) and exclusion (that is, the failure to provide bene�ts to those who do need them). Bene�ts are paid through Caixa Econômica Federal, a government- owned bank with over 30,000 payment points nationwide where families can collect bene�ts using electronic cards. This enables administrators to create and publish a payment calendar early in the year, which facilitates budgeting for participating families. Source: Robalino, Rawlings, and Walker 2012. Ensuring Inclusion to inclusive growth and with a deeper knowledge The World Bank will need to help countries of effective SPL in LICs and fragile contexts. develop innovative, evidence-based approaches to sustainably expand coverage of SPL, notably in The World Bank will support increased low-income countries and among excluded inclusion through �scally sustainable SPL groups. This will build on experience, including cur- approaches. A more systems-oriented approach to rent engagement with programs such as Pakistan’s SPL will also bring ef�ciencies. Effective targeting Benazir Income Support Program, which covered 2.2 systems can help countries prioritize investments to million households within a year of starting up, and ensure that they reach the poorest and most vulner- Ethiopia’s Productive Safety Net Programme, which able, using diverse approaches from data-driven currently reaches 7.6 million bene�ciaries, close to 8 methods to more reliance on self-targeting or commu- percent of the population. Knowledge sharing around nity targeting. The World Bank will also facilitate speci�c country experiences will be coupled with sustainable approaches through more effective donor evidence-based advocacy of the contribution of SPL coordination, particularly by encouraging countries to THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 31 move away from fragmented programs to scaled-up ■ Deepening links with the private sector, social national SPL programs, moving these programs on- funds and other community based budget and getting concerted technical and �nancial organizations, which are often the institutions assistance for these programs from development with the best capacity and local knowledge; partners, including the World Bank. ■ Ensuring �nancial sustainability in order to expand coverage, often through the improved The World Bank can help support countries in making use of existing resources; and sure that their policy and program choices are ■ Using information technology—mobile phones, informed by generating data on SPL programs and GPS identi�cation and cheap data bene�ciaries, linked to models on reform options, and processing—to leapfrog to flexible and effective by facilitating learning across countries. governance, service delivery and system integration mechanisms. Within countries, different excluded groups will need different operational approaches, as dis- Multisectoral approaches will often be needed to cussed below. These groups include the ultra-poor, promote livelihoods and ensure food security in women, the disabled, the elderly, and children. the largely rural, informal economies characteristic of LICs and fragile contexts. As box 4.3 illustrates, THE PARTICULAR CHALLENGE OF LOW- this can be accomplished by following an approach INCOME COUNTRIES AND FRAGILE CONTEXTS aimed at helping households accumulate productive Setting up appropriate systems will be especially assets over time and invest in their human capital. challenging in lower-income countries and fragile This challenge is likely to become increasingly acute contexts, particularly as the World Bank’s SPL prac- given the anticipated effects of climate change and tice has historically been more focused on MICs. their concentration in low-income regions, again call- Restricted �scal space and limited institutional capac- ing on SPL to engage multisectorally to help ity constrain effective government action and limit the communities adapt and build resilience. ability to apply traditional social protection instru- ments that may have worked well in middle-income REACHING THE MOST VULNERABLE contexts. From an operational perspective, this is Despite substantial gains in the coverage of further complicated by institutional fragmentation SSNs, many poor and vulnerable groups remain across public sector institutions, NGOs and donors, uncovered, which often include children, women, and limited public and formal sector presence in many ethnic minorities, and the disabled. So the challenge of the most disadvantaged regions. Fragile contexts of reaching the most vulnerable has two dimensions— present particular challenges, but SPL has been used increasing the availability of SPL programs in LICs successfully to support stabilization (see Box 4.2). and fragile contexts, and making sure that the most vulnerable can access the programs that exist. The World Bank and its partners will have to be both innovative and pragmatic in tailoring sustain- The World Bank will work with low-income coun- able and scalable SPL in lower-income countries tries, and those with fragile contexts, to help and fragile states. To help countries build the basic institute, improve and extend SPL programs and elements of social protection programs, and to improve systems, with support from catalytic resources, and integrate the ones that exist, will require deepened such as the Rapid Social Response (RSR) initia- investments and coordination in at least �ve areas:68 tive. As described earlier, this will in many cases take ■ Building up evidence from operations by the the form of helping institute the “building blocks� of World Bank and others on which programs administrative subsystems that can effectively and and approaches work best in LICs and fragile ef�ciently support one or more SPL programs. In environments others, the focus will be on improving and extending ■ Strengthening central and local capacity for the programs that exist. In many situations, a few core delivering SPL programs and services by programs—such as a cash transfer or seasonal public building a foundation of good governance and works program—can be used as a platform for a larger transparency menu of SPL services. For example, bene�ciaries 32 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 4.2 Social Protection in Fragile Contexts: Three Approaches SPL programs in fragile situations can build fundamental institutions while at the same time protecting the vulnerable. Three approaches highlight this role: ■ Labor-intensive programs can be a stabilizing force in fragile situations while at the same time yield- ing valuable infrastructure investments. Examples include the sporadic employment initiatives in the Gaza Strip since the 1990s and the Liberian Cash for Works Temporary Employment Program that created 17,000 temporary jobs in response to the 2008 Food Crisis, as well as being the basis for a Youth Employment Skills Project that has created an additional 45,000 temporary jobs in three years. ■ Cash transfer programs can also help communities to re-establish their livelihoods and restore lost assets. These include transitional payments to demobilized ex-combatants in Angola, Mozambique, and Rwanda, along with cash payments to internally displaced people and veterans in Timor-Leste. In Nepal, programs such as social pensions for the elderly, single women, and people disabled during wars have stayed in place and grown throughout protracted conflict and its aftermath. ■ Fee waivers for government services can also be a form of cash bene�ts—as was the case with education and health care in Liberia and maternal and child health care in South Africa. Such programs can redress the balance for those groups that were previously excluded from state programs. Source: Andrews et al. 2012; World Development Report 2011: Conflict, Security, and Development. could be encouraged to take advantage of micro- Sem Miséria program. For those in the informal sec- insurance initiatives or health insurance, as has been tor, new efforts are underway to let them avail of done recently in Ethiopia, Rwanda, and Pakistan. In social insurance, as with the National Health fragile and post-conflict contexts, SPL programs that Insurance Scheme (called RSBY) in India—a provide basic income support, strengthen access to demand-side, voucher-like intervention that aims to basic services, and rebuild infrastructure can be trans- provide catastrophic health insurance to a potential formative in helping both provide resources and build population of 60 million poor Indian households. social cohesion. In these contexts, the World Bank will be most effective when working closely with Finally, the World Bank will increasingly NGOs, the UN system, and community-based organi- support the use of innovative Information and zations to ensure access to basic services. Communication Technologies (ICT) as a way to reach the most vulnerable. The dramatically lower The World Bank will prioritize South-South learn- costs and extensive reach of smart cards, point of ing to champion innovative outreach strategies sale devices (POS), and cell phones provide opportu- that can be tailored to speci�c needs of different nities to rapidly expand SPL coverage while cutting vulnerable groups. This may, for instance, require fraud, error and corruption. For example, biometric broader ways of identifying and targeting the poor, technology is increasingly being used to register ben- including the involvement of gender-balanced e�ciaries and deliver social services, often through groups, communities and intermediaries (as in the strong collaboration with the private sector. It has Indonesia Direct Cash Assistance or BLT program).69 been used to scan and identify bene�ciaries of the It may also involve using social assistance as an Disarmament, Demobilization and Reintegration entry point to access a network of services tailored (DDR) project in the Democratic Republic of Congo. to multidimensional needs, as in the Chile Solidario India’s unique identi�cation scheme has already program. Often, this can be combined with the use enrolled 200 million people and expects to reach 400 of intermediaries, such as local social workers and million—a third of all Indians—by the end of 2012.70 In community actors to reach and connect the excluded Kenya, cash transfer payments are being made using to existing programs—as is being tried in the Brasil cell phones (see Box 4.4). THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 33 Box 4.3 Promoting Livelihoods and Food Security in Rural Economies Social protection can play a dual role in strengthening rural livelihoods and promoting food security in rural areas typical of LICs and fragile situations. Some best practices are emerging about how social protection sys- tems can help households accumulate productive assets and build human capital: ■ Increasing capacity to respond counter-cyclically. Shocks and seasonal stresses can create uncertainty in commodity prices and labor demand. Advanced planning during more prosperous times can help meet households’ basic income and consumption requirements in bad times. Making better use of early warning information—for example, regarding adverse weather events—can help this advance planning. ■ Investing in productive safety nets. SPL instruments can be designed to generate economic bene�ts to communities. Labor-intensive public works offer temporary employment and income support to recipients but can also build or rehabilitate needed infrastructure. Cash transfers and locally managed school feeding programs can bene�t the local economy by injecting cash and providing employment. ■ Customizing interventions to community needs and vulnerabilities. The timing and types of transfers should be geared to meeting the speci�c needs and vulnerabilities of rural households, for exam- ple, protecting them against health shocks or promoting livelihood ladders. A promising approach is to capitalize on the key role that women play in maintaining household food security. This can be done by incorporating such simple features as targeting approaches and project selection procedures into the design of SPL programs to encourage positive intra-household distribution effects on, for example, chil- dren’s nutrition and school enrollment. ■ Including agriculture and nutrition perspectives. Rural development is a multidimensional chal- lenge, and SPL interventions need to build synergies with other sectors’ investments in agriculture and nutrition. Evidence suggests that multisectoral interventions, which combine SPL interventions with other efforts focused on livelihood promotion and human capital development, can have highly bene�cial effects. This requires collaboration across sectors within the World Bank, as well as coordination between different specialized agencies, including the United Nations Food and Agriculture Organization (FAO), UNICEF, and WFP. Box 4.4 Using Cell Phones to Protect the Poor in Kenya In Kenya, Safaricom (working with Vodafone) launched an initiative called M-PESA originally co-funded by the UK Department for International Development (DFID) to enable customers with no access to conven- tional banking to receive bene�t payments through a pre-paid phone. All customers need to register at an authorized M-PESA agent— usually petrol stations, supermarkets, and Safaricom stores—by providing a Safaricom mobile number and their identi�cation card. The agent then activates an account on their mobile phone handset that enables customers to load cash in and take cash out at any M-PESA outlet, including their bene�t payments. Targeted households are clustered into groups of up to 10 to share the phone, and one liter- ate person is nominated as the cluster leader. Although the equipment is shared by all cluster members, each bene�ciary receives his or her own SIM card to register for M-PESA to reduce the risk of fraud among cluster members. This system currently serves 4 million customers, and there are over 360 M-PESA agents nationwide. Source: Africa Social Protection Strategy, World Bank. 34 RESILIENCE, EQUIT Y, OPPORTUNIT Y ENSURING GENDER-SENSITIVE SOCIAL The World Bank will also deepen analysis and PROTECTION AND LABOR71 support of voluntary savings to help address the The World Bank will work with countries to ensure coverage gap. To date, signi�cant coverage expan- that programs adequately address the SPL needs sion has been achieved in only a few developing of both women and men (and girls and boys). In countries, including China and Sri Lanka, but several social assistance programs, as relevant to the coun- initiatives are also underway in countries, such as try context, the World Bank will ensure that women India and Vietnam. In order to succeed, transaction have access to the transfers—building on the evidence costs must be kept low relative to the amounts saved that increases in the relative resources controlled by and �scal incentives are needed to compensate work- women commonly translate into a larger share of ers for sacri�cing valuable liquidity. Credible household resources going to family welfare, institutions that can be entrusted with workers’ sav- especially to expenditures on children. In workfare ings will also be required. The World Bank will also programs, program designs will incorporate social work to �ll the large knowledge gap with regard to norms about gender-appropriate behavior, as well innovative mechanisms to expand voluntary coverage as gender-speci�c responsibilities with respect to for social insurance programs. In this area, there household and market work (see Box 4.5). The appears to be much to be learned from recent experi- counter-example from the workfare programs in ences with health insurance targeted to the poor, Indonesia during the 1997–98 East Asia crisis such as in Ghana and India. was that female participation was hindered because program design emphasized work typically performed More broadly, the World Bank will work to build by men (for example, repairing roads, rehabilitating knowledge and practice on how to mobilize and schools, and community centers). And World Bank systematize both contributory and noncontributory advice on old-age income security schemes will approaches to pensions, with an eye toward inno- reflect the reality that since women live longer than vative, �nancially viable and scalable solutions. In men, they have a greater need for old-age income this regard, the World Bank’s advice will be pragmatic security, particularly during widowhood. Since women and context-speci�c, focused on balancing coverage in developing countries are more likely than men to and adequacy of pensions with �nancial viability, work in the informal sector, they are also less likely closely guided by the country’s demographic/aging to bene�t from formal pension schemes. pro�le, its social contract, its �scal capabilities and regulatory/administrative capacity. The right “portfolio� PROTECTING THE ELDERLY of pensions programs will depend very much on these Protecting the elderly is a growing challenge for country-speci�c conditions (Box 4.6). many developing countries, which will see the share of its elderly population grow rapidly over Importantly, the role of programs helping resilience the coming decades. World Bank assistance to (social insurance) and equity (social assistance) countries to close the coverage gap will involve a can be complementary and can change over the variety of approaches—from “social pensions� (non- long time horizon required for pension policy. As contributory transfers to the elderly) to voluntary populations shift from rural to urban areas and the size savings. Social pensions are an increasingly popu- of the formal sector grows (along with income levels), lar response to the coverage gap for the elderly, as the role of contributory schemes is also likely to grow. with World Bank-supported programs in the However, the unprecedented aging of much of the Maldives and South Africa. For older workers who developing world suggests a race between the expan- do not have enough time to accumulate pensions in sion of coverage and the aging process. contributory programs, this noncontributory social pensions approach is the only option available, but will require investing in the systems agenda of coor- Responding to Crises dination between SSNs and pensions programs and coordinated implementation tools and pro- The World Bank will work with countries to build cesses (for example, ICT applications for crisis responsiveness into SPL systems as an identi�cation and payment). important complement to addressing chronic THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 35 Box 4.5 Designing Gender-Sensitive Public Works Programs: India’s Mahatma Gandhi National Rural Employment Guarantee Program From its inception, India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was designed to encourage women’s participation and empowerment. The scheme, which promises 100 days of work per year to all rural households, is equally available to male and female adults willing to do unskilled manual labor. Crucially, the statutory minimum wage set for the scheme is the same for men and women. In a context where market wages are typically much lower for women, the designers’ vision was that MGNREGS would raise the bargaining power of poor rural women whether they participate or not. The legislation also provides for a number of other design features that were deemed vital to ensuring women’s participation. These include the following: ■ Creche facilities for childcare at the jobsites ■ The availability of drinking water and a rest area in the shade at the work sites ■ A ban on contractors ■ Women’s individual bank or post of�ce accounts for direct wage payments. The scheme is very popular with women. The evidence so far suggests that MGNREGS has succeeded in attract- ing them into the workforce. Dutta et al. (forthcoming) �nd that across states, women’s participation rates in the scheme are twice that of their participation share in paid casual labor. They are also typically paid much higher wages on the scheme than in other casual work, although still often less than men. And in speci�c states, studies report positive impacts on women’s lives and welfare (Holmes and Jones 2011). Yet, the reality on the ground differs substantially from the scheme’s articulated vision. There is huge variation in how MGNREGS is working across the states of India. But almost everywhere there is evidence of unmet demand for work and with few exceptions, rationing rates tend to be higher for women than for men. Not much is known about the provision of worksite facilities but anecdotal evidence and one study for Bihar �nd no sign of these facilities being provided on average. Contractors are rife and as expected, are less likely to provide work to women. Women’s awareness of their rights, off MGNREGS stipulations, and how to get work is generally very low. Together with the supply side constraints, this severely limits them from acting on their rights. Good legislation and policy design are key prerequisites and important �rst steps towards rendering SPL poli- cies more inclusive of women. However they are often not enough. More needs to be done, including repeated awareness and sensitizing campaigns aimed at both men and women. These can help change social norms and attitudes and improve women’s status and empowerment. Source: Dutta et al. forthcoming; Holmes and Jones 2012; Subbarao et al. forthcoming. poverty and vulnerability to idiosyncratic shocks. adequately will be needed, such as early warning sys- This holds for both economic crises and crises result- tems, real time monitoring and others. ing from climate change (Box 4.7). Three core elements stand out: �nancial planning, bene�ciary A second feature of crisis-responsive SPL sys- identi�cation, and program design. tems in both MICs and LICs is the ability to identify those who newly need access to SPL programs Crisis responsiveness of any SPL system will when faced with individual-level or broader require advanced �scal planning to ensure that there shocks. In certain contexts, particularly MICs, part of is a mechanism to release additional resources, and the work will be on “automatic stabilizers� such as unem- use of appropriate �nancial instruments to ensure that ployment bene�ts, which can protect some of the this funding can be rapidly mobilized. Moreover, mecha- newly vulnerable—such as those working in the formal nisms to identify potential risks and plan responses sector. However, these instruments do not apply to 36 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 4.6 The World Bank’s Conceptual Framework for Pensions The conceptual framework for the World Bank’s analysis of pension systems was presented to the World Bank Board of Directors in 2007 and is summarized in a 2008 report. The now familiar terminology included �ve “pillars.� The zero pillar, sometimes referred to as “social pensions,� refers to noncontributory, cash transfers �nanced by the state. The �rst pillar is the more traditional social insurance model with mandated contribu- tions typically aimed at insuring against the income risks associated with old age, disability, and death. In some cases, �rst pillar programs are explicitly redistributive, aiming for higher replacement rates for lower income workers. These programs are publicly administered and are either partially funded or operate on a pay-as-you- go basis. In contrast, the term “second pillar� refers to a mandated, de�ned contribution plan, in most cases with the fund and data management at least partially handled by private sector entities. The third pillar refers to recognized modes of voluntary retirement savings, usually regulated and encouraged by government and taking varied forms (such as individual retirement accounts, employer sponsored de�ned bene�t, or de�ned contribution plans.). Finally, the fourth pillar captures a range of nonpension sources of income support, including family support (private intergenerational transfers), health insurance, and even emerging �nancial instruments, such as reverse mortgages. The pillars are a useful device for describing most of what is observed in practice across the world in a system- atic manner. The characteristics of the systems can be broken down further into their speci�c �nancing, allocation of risks, governance and management arrangements. All of the pillars require supportive enabling conditions, which include the macroeconomic environment, institutional capacity, and adequately functioning �nancial markets. Financial market regulation, depth, and contestability are particularly important for �rst pillar reserve management and the effective functioning of second and third pillars. The conceptual framework considers pension systems in their country-speci�c economic and demographic context. Source: Dorfman and Palacios 2012. Box 4.7 Mobilizing Social Protection in the Face of Climate Change Social protection is increasingly recognized as an important instrument to help poor households respond to and build resilience against the impacts of climate change. In recent years, cash transfers, social pensions and public works programs have been utilized to respond to rapid onset natural disasters (for example, earthquakes or tsunamis) in such places as Turkey, Pakistan, Honduras, and Madagascar. Following the 1999 Marmara earthquake, Turkey’s Social Solidarity Fund successfully implemented a transfer of repair allowances to victims. After the 2004 Asian tsunami, the Maldives government developed a damage payment system that quickly tar- geted and reached the affected population. SPL programs have also increasingly responded to slow onset disasters, such as drought, which are likely to increase because of climate change. In Ethiopia, households affected by the 2008 drought received transfers that helped improve caloric consumption by 30 percent com- pared to nonbene�ciary households. Social protection can also help the poor adapt to climate change, reducing their vulnerability ex-ante through social and weather-based insurance, transfers, livelihoods, and asset diversi�cation. In Ethiopia, the Productive Safety Nets Program is an example of a government-run safety net project that has built in risk reduction elements into its operation, for example, via cash-for-work activities where the public works aim at improving water management and soil erosion. In the longer term, however, social protection has the greatest potential to contribute to climate change adap- tation through its promotion function. SPL programs and systems can help communities diversify risk, enhance incomes, and build skills and assets, including through climate-sensitive public works programs. Source: World Bank/UN 2010, Arnold and Burton 2011, and Kuriakose et al. 2012. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 37 many (including the working poor) and may be less PROTECTING AND PROMOTING HUMAN CAPI- relevant for many in economies where formal employ- TAL, ESPECIALLY OF CHILDREN ment is small. Since many of those who will need The World Bank will continue to emphasize SPL protection during a crisis will not be those who are programs as important investment channels for already part of the existing bene�ts system, World human capital development—and thus for devel- Bank approaches to identify the vulnerable during opment and productivity. The World Bank will crises will involve different principles of targeting than highlight and build the evidence of SPL programs’ those normally used to identify the chronic poor. A role in the accumulation and preservation of human particularly effective mechanism is relying on commu- capital, and align practice with evidence as has been nities or local actors, especially after natural disasters, done with CCTs and now increasingly with uncondi- but it is more broadly applicable. tional cash transfers. 72 In MICs and LICs alike, World Bank advice around The World Bank will work collaboratively with responsiveness to widespread shocks will empha- other sectors and actors to ensure that SPL, nota- size creating provisions for flexible programs within bly safety nets, is playing its needed role in the SPL system portfolio. Planning ahead for such protecting and promoting human capital among programs has three distinct advantages. First, and most children. SPL programs and systems, while bolster- important, they avoid signi�cant lags in implementation ing the ability of and incentives for parents to demand caused by new efforts at design and policy consensus, education and nutrition for their children, will partner and allow rapid response. Second, they allow the cre- with the education, agriculture and health, nutrition ation of meaningful “sunset clauses� (the triggers for and population (HNP) practices of the World Bank to when programs stops or bene�ts decrease when the ensure that there is effective supply of good schools, crisis and/or its consequences are over). And third, they adequate food, and health clinics for children. In col- may lead to a smaller �scal burden, as opposed to dis- laboration with partners (including UNICEF and Save cretionary measures, such as subsidies or programs that the Children), the World Bank will further develop are hastily designed during crisis times. child-sensitive social protection approaches to help mitigate the effects of poverty on families, strengthen families in their child care role, improve child nutrition Enhancing Productivity and enhance access to basic services for poor fami- lies. This is particularly important during crises, given The World Bank will support greater investments the vulnerabilities faced by children and the conse- in human capital among children and improved quences of inaction. Overall, this work will build on access to better jobs for adult workers. SPL pro- the important advances made by SPL in recent years grams that support proper early childhood in linking equity-oriented approaches with those pro- development—promoting children’s cognitive abilities moting opportunity.73 and nutritional foundations—have been shown to have clear consequences for their future productivity. The World Bank will also undertake efforts to address food price volatility and undernutrition, It is also essential to consider interventions for those elements critical to ensuring the preservation and individuals who are already in the labor market or growth of children’s human capital. Almost a billion close to entering it, often without the necessary tech- people experience chronic hunger (30 percent of the nical, cognitive, and noncognitive skills. Facilitating population in Sub-Saharan Africa) and nearly 2 billion their transitions into productive jobs and building their lack the micronutrients they need for good health.74 skills are critical to promoting development and inclu- The World Bank’s safety nets practice will work with sive growth. In this context, the issue of how to think other sectors to make social assistance more “nutri- about development through the “jobs lens� will be the tion-speci�c,� through efforts to provide nutritionally central question of the forthcoming World appropriate food and supplements or by linking ben- Development Report 2013 on Jobs (Box 4.8). The e�ciaries to services needed to improve the nutritional SPL practice will be informed by the report’s analysis status of women and young children. Cross-sectoral in the years ahead. collaboration is also needed, particularly with 38 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 4.8 World Development Report 2013 on Jobs: Preliminary Messages and Potential Links to the SPL Strategy The 2013 World Development Report (WDR) from the World Bank will focus on Jobs. Its outline, circulated October 2011, proposed three main sets of messages: First, jobs are transformational. Jobs connect improvements in living standards, productivity gains, and social cohesion. Second, some jobs do more for economic and social development than others, because they reduce poverty and inequality, strengthen value chains and production clusters, or help build trust and shared values. Third, understanding how labor markets interact with government and market imperfections, and how this inter- action affects development goals, is the key to identifying and evaluating policies for the creation of good jobs. While the World Bank will work on the full operational implications of the WDR once the report is �nalized, its framing of jobs in terms of living standards, productivity gains and social cohesion are close to this strategy’s framing in terms of resilience, equity, and opportunity. High productivity jobs are central to allowing people to protect themselves from poverty and to seize the opportunity to improve their living standards, and SPL mechanisms, including those that facilitate access to jobs, can be transformational in building social cohesion in postconflict con- texts and in building agency for men and women alike (themes in the previous two WDRs on Conflict, Security, and Development (World Bank 2010) and Gender Equity and Development (World Bank 2011). Source: World Development Report 2013: Jobs (Outline, October 2011). agriculture, private sector development and social Development (FPD) and Poverty Reduction and development, for example, in developing agricultural Economic Management (PREM) networks. SPL plays insurance mechanisms that can address poverty and a complementary role, especially in the design of agricultural productivity. labor regulations and income protection programs that can be extended to a majority of workers but IMPROVING ACCESS TO JOBS without creating distortions in the labor market that The World Bank’s SPL practice will work with reduce the creation of good jobs.75 Evidence sug- countries to address systemic and policy reforms gests the importance of competition in facilitating �rm that can help access to jobs for their population— entry, innovation, and productivity growth. including youth. Although the current global crises has focused attention on this issue, the challenge is Second, the World Bank will support SPL policies not merely cyclical and crisis-driven—in any country, it that improve the productivity of those already at is not easy to ensure that workers can �nd and main- work. For the majority of the world’s workers who tain suitable jobs. work in agriculture, as self-employed in low productiv- ity activities, or as nonpaid employees in family First, the World Bank will help countries improve business, a stable macro-economy and an ef�cient the ef�ciency of job creation. This is an area where business environment are unlikely to be enough. SPL will need to partner with other sectors within the Targeted interventions will be required to either World Bank and external partners working directly improve the productivity of the activities where they with the private sector, who would help countries with are involved—if economically viable—or to help them business environment reforms that promote invest- transit into higher productivity activities. ments, innovation, and economic diversi�cation, while providing adequate protection to workers (see Box In coordination with other sectors, SPL will design, 4.9 on the MILES framework). Within the World Bank, implement, and evaluate interventions to address these sectors include the Financial and Private Sector the constraints facing the self-employed. These THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 39 Box 4.9 The MILES Framework The MILES framework is an operational and policy relevant framework, which helps countries design comprehensive labor market strategies to create more and better jobs. MILES is multisectoral by its very design, focusing on �ve areas considered critical for employment creation (hence, the acronym MILES): Macroeconomic policies; Investment climate, institutions and infrastructure; Labor market regulations and institutions; Education and skills; and Social Protection (social insurance and SSN programs). Building on various diagnostic tools in areas central for job growth, the framework aims at identifying key constraints for job creation in an individual country, proposes policy priorities and required reforms, and helps implementing them. The implementation of MILES requires obtaining support from key stakeholders and close cooperation across different ministries, institutions, and social partners. The World Bank is well placed to carry out this task by using its Analytical and Advisory Activity (AAA) and economic and sector work (ESW) to provide analytical content, and various loans and grants to provide necessary funding, and has successful piloted the MILES framework in more than 15 countries. Source: Banerji et al. (2008). interventions will address the following: motivation relevant interventions fall into two categories: pro- and risk tolerance (via cultural and social norms); grams to stimulate labor demand; and programs to technical and noncognitive skills; information about support job search and improve employability. The production technologies, best management practices, �rst set of programs mainly include public works and and prices; access to value chains and markets; and wage subsidies,79 while the second bring together liquidity constraints. Interventions of this sort include such interventions as intermediation, counseling, job- business and life skills training, advisory services, search assistance, training, skills certi�cation, and networking, improving access to �nance, and social services that facilitate mobility (for example, micro-franchising. child care). For those unable to access formal jobs, programs promoting productive self-employment can Third, the World Bank will help countries improve also become part of the portfolio of programs, all the facilitation of labor market transitions—from coupled with policies that create the right incentives school-to-work, out of unemployment or inactivity, for work (Box 4.10). or between jobs. Indeed, workers’ earnings and households’ welfare ultimately depend on the incen- A particular challenge for this agenda will be facili- tives and constraints that workers face in these tating “graduation,� or transitions from social transitions. Similarly, low participation rates can be assistance to work. This involves improving the incen- explained by ineffectively designed transfer programs, tive structures in program design to ensure that those the lack of support services (for example, for child who are able to move into employment are encouraged care), or prevalent social norms (for example, women and supported to do so. Facilitating this operationally not allowed to work outside the household). And the will also involve better coordination between social movement of labor from low productivity to high pro- assistance and ALMPs, so that those receiving social ductivity sectors can be constrained by lack of assistance can build the skills and work experience information about alternative opportunities, mobility needed to move into productive employment. costs, lack of skills, or lack of credit. Once again, this will necessitate cross-sectoral work aimed at address- BUILDING WORKERS’ SKILLS ing these critical gaps. The World Bank’s work on helping workers improve their skills will be founded on two prereq- A key SPL focus will be the design and implemen- uisites to effective policy—understanding how tation of activation policies and ALMPs. The skills are applied, and how to build appropriate 40 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 4.10 Active Labor Market Programs and the Youth Employment Challenge A key focal area of the World Bank is improved designs of ALMPs, including stronger links to the private sec- tor. This is important for adult workers, but has particular urgency for youth, who have unemployment rates in most countries that are two to three times that of adults. The STEP framework, explained in Box 5.3, provides a long-run and comprehensive framework to address the skills of youth and ensure that they are productive and well integrated into the workforce. But what about the short run? Can ALMPs —such as those focusing on training or addressing lack of information about the job market—help youth �nd productive jobs? At �rst glance, the record seems disappointing. Evaluations of activation and ALMPs have given mixed results. However, these poor results may not say much about the potential ef�cacy of these programs, but more about design flaws in the programs being evaluated. In fact, there is no evidence to suggest that ALMPs as a whole are not needed or are not useful. And the market failures that these programs try to address are real—such as lack of knowledge about job opportunities or lack of skills demanded by employers. Successful programs linking individuals to jobs have two de�ning characteristics: �rst, they integrate various interventions addressing multiple challenges faced by job seekers, and second, they have a strong involvement of the private sector. For example, “training plus� programs consisting of technical or life skills training fol- lowed by work experience through private sector internships and job placement assistance have been found to be quite successful at activating individuals. Interventions, such as the Jovenes programs in Latin America (mainly targeted to unskilled youth)76 and Probecat in Mexico77, �t in this category.78 Source: Almeida et al. 2010and Almeida et al. 2012. skills. This will require a better understanding of how cost-effective nor responsive to labor market demand. different types of skills (technical, cognitive, and non- The World Bank will build on promising advances cognitive) affect labor market outcomes, and then made in programs (such as the Latin American developing systems that are able to transfer the nec- Jovenes) in strengthening links with labor market essary skills to current and future workers. Skills are demand through directly engaging the private sector. acquired through a multiplicity of channels—from par- These operational experiences will be studied, shared, ents and families, through informal apprenticing with and developed more closely. more experienced workers, or through formal educa- tion in schools, universities, vocational centers or A CHALLENGING AGENDA on–the-job training.80 The SPL practice will be work- The proposed strategy is highly ambitious—and ing closely with the World Bank’s education practice fully achieving its strategic aims will take time and on the skills agenda, focusing on how to build and require concerted efforts by the World Bank, devel- upgrade job-speci�c skills. The three types of training oping countries, and partners. There are four risks. programs that will receive attention are the following: First, despite the recent attention paid to SPL during pre-employment technical and vocational education times of crises, governments may �nd it dif�cult to and training; on-the-job training; and training-related prioritize SPL expenditures in better times—in the face ALMPs. The last is usually targeted to individuals of more visible investment needs and vocal constitu- without access to the �rst two, often low-skilled encies. Second, political economy considerations may unemployed or informal workers. deter governments and development partners from investing in coordinated, systemic approaches, and Finally, the World Bank will focus on improving instead continue to fragment or duplicate programs. existing labor market training programs, notably in Third, moving from a program to a systems approach MICs. In many countries, these programs are neither will also involve developing institutional capacities that THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 41 are not always present, especially across the myriad Second, the World Bank’s policy advice to client of sometimes weak SPL agencies. Finally, SPL efforts countries, and collaboration with partners, will empha- need to be sustainable, with a cost-effective use of size both the value of inclusive and productive appropriate resources to meet country goals. systems and good technical solutions to achieve them. Its work with partners will especially emphasize But the challenges facing developing countries the value of coordinating work and resources in help- and their people necessitate this level of ambition, ing poorer countries build SPL systems. Third, and the strategy underlines structured ways in capacity building would be a key component of the which the World Bank will use its comparative work, especially in LICs and fragile contexts, including advantage to help address them. First, the World the generation of accurate, useful, and frequent data Bank will support clients in building evidence on the to improve results. And fourth, the World Bank will performance of SPL programs systems in promoting continue to build the evidence that effective, inclusive resilience, equity, and opportunity—and will couple this SPL systems do not have to be expensive or complex work with knowledge access, including through inten- —helping countries to select the most cost-effective si�ed work on South-South knowledge exchanges. approaches to meet their speci�c needs. 42 RESILIENCE, EQUIT Y, OPPORTUNIT Y THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 43 5. Principles of Engagement for the World Bank Experience from a decade of successful SPL Currently, three knowledge gaps exist on SPL. engagement and demands from clients con�rm that success flows not just from what the World Gap 1—knowledge on existing programs. SPL sys- Bank does, but how the World Bank engages. This tem design in many contexts is handicapped by the experience points to three principles of engagement lack of basic information on what programs exist, how as central to success in the World Bank’s work in they are structured, and who receives bene�ts. This SPL knowledge, operations, and partnerships: evi- information gap is particularly problematic in fragile dence-based knowledge; tailored to country states and LICs, especially in Sub-Saharan Africa, contexts and evidence; and collaborative across a which undermines both global knowledge and local range of sectors and actors. management. This gap can be �lled by strengthening and expanding the country coverage of SPL assess- Ensuring evidence-based, tailored, collaborative ment and benchmarking tools, using labor force data, engagement will allow the SPL practice to derive household data, and program-level administrative knowledge from the evidence in operational contexts. data. Strengthening national statistical systems, ongo- It will also allow SPL practice to use that knowledge ing surveys and program level administrative data are about results to design context-speci�c, evidence- needed. Building on efforts to ensure the quality, cov- based operations. Moreover, it will help mobilize erage, and comparability of data within and where partnerships at the World Bank, country, and global needed across countries, analytical tools can be levels to create a virtuous cycle of building inclusive, applied (including the World Bank’s SP-ADEPT soft- responsive, and productive SPL systems in all the ware) to develop comparable and systematic SPL World Bank’s client countries. indicators that will allow benchmarking over time and across countries. Focus on Evidence-based The data generated by the World Bank can also be com- Knowledge pared with other indices, such as the Asian Development Bank (ADB)’s Social Protection Index and the administra- The strategy prioritizes the generation and sharing tive data on social protection, especially social security, of evidence-based knowledge to address the from the ILO and the International Social Security three gaps outlined earlier—on what programs and Association. At the country level, performance monitoring systems exist, how they perform, and how results mechanisms can be strengthened within and across can be shared. This capitalizes on the World Bank’s programs (and linked to bene�ciary registries), with the comparative advantage of combining in-depth local World Bank facilitating good practice across countries. engagement with an ability to leverage global knowl- edge, as outlined in the World Bank’s Post-Crisis Gap 2—knowledge on program impacts. There are Directions paper (2010). gaps in knowledge across types of program and con- texts about whether programs are achieving their This strategy will be selective in prioritizing certain intended impacts. Impact evaluations can be applied knowledge gaps, and couple this with capacity- selectively to look at both overall program effective- building to ensure that countries can be involved in ness and the relative effectiveness of different generating the knowledge they need to inform policy programs or program designs (including relative to and effectively manage programs and systems. This costs). This will be particularly important in areas also has implications for partnerships. Filling these where there is relatively little evidence, including the gaps cannot be done by the World Bank alone, but in following: fostering entrepreneurship and raising the partnership with other actors in SPL, to collectively productivity of small, often family-owned, businesses; prioritize effective knowledge sharing and comple- designing passive income support schemes that don’t mentary approaches to knowledge generation. discourage people from �nding jobs; designing public 44 RESILIENCE, EQUIT Y, OPPORTUNIT Y works programs that raise incomes, build skills, and These will be used to ensure that staff members have create productive assets; and building on the evi- access to the latest knowledge, regardless of where dence from CCTs to examine the performance of they sit, and to reach out to clients and a broader com- UCTs (including social pensions). As the number of munity of practice, including civil society, academia, and impact evaluations in the SPL area grows, there will private actors. Finally, as underscored by the 2011 be an added challenge of effectively disseminating Knowledge for Development report and 2011 IEG and managing this knowledge. This, therefore, will review of safety nets, the impact of analytical work is require investing not just in knowledge generation, but greatest when client engagement is prioritized and in knowledge management, especially to ensure that sustained. Thus, SPL knowledge products will increas- evidence informs policy. ingly have a clear, client-based plan for ensuring, not only quality, but also engagement and results. Additionally, the SPL sector will continue to partner with the Development Economics Vice Presidency (DEC) and PREM in developing modeling tools to Tailor Operations to Country assess the �scal, behavioral, and welfare impacts of Context and Evidence parametric reforms in SPL. This will build on an impor- tant foundation that currently includes the SP-ADEPT/ Experience shows that successful and sustainable Social Protection Atlas, the Pension Reform Options SPL programs and systems are tailored to social Simulation Toolkit (PROST), and the new contracts and national priorities, as well as reflec- Unemployment Bene�t Simulation model (UBsim). tive of countries’ political, social, institutional, and Finally, new approaches will need to be developed to economic contexts. The principle of country tailoring assess SPL systems, building on the efforts implies that SPL programs and systems need to be described above. country-led, and country-implemented, with a strong focus on country capacity to do so—as established in Gap 3—sharing knowledge. The search for scalable, the Paris and Accra agendas. For most developing sustainable solutions in SPL has been particularly influ- and emerging countries, this implies a strong associ- enced by countries in the developing world learning ated need to build capacity in the government from each other about designing and implementing ministries responsible for SPL. Country leadership, effective programs. Well-performing programs and context, and capacity are particularly important for designs—such as public works programs, social funds, �nding appropriate solutions to dif�cult questions and and CCTs—have influenced authorities setting up their trade-offs—such as balancing the need for increased own SPL programs in other developing and emerging coverage and crisis-readiness of SPL systems with countries. The major driver has been the synthesis and constraints relating to �scal affordability and adminis- effective transmittal of knowledge on good practices trative capacity. Thus national goals and priorities on development effectiveness. The SPL practice has determine the World Bank’s role as a partner, working been at the forefront of cross-country and cross- to deliver these goals together with a range of actors. regional knowledge sharing—especially South-South knowledge sharing. This has included formalized net- The principle of country tailoring has important works of practitioners in the areas of socials funds and implications for applying the strategy in different CCTs (notably the LAC learning circle), a series of regions, as outlined in the regional SPL strategy highly-attended annual South-South learning confer- applications in Annex 1. The SPL practice will ences on SPL, learning partnerships with leading think vary across regions and countries according tanks (such as the World Bank-IZA partnership on to client demands, priorities, existing challenges labor markets and development), and vibrant communi- and available resources. ties of practice (Box 5.1). While each region faces the whole array of challenges, The new strategy will broaden and deepen this global existing conditions and client demand points to some knowledge engagement and sharing¸ continuing to areas of priority. In Africa and South Asia, where many prioritize engagement both face to face and building on low-income countries are concentrated, a strategic the promising use of ICT to create knowledge platforms. focus is on building SPL systems that promote THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 45 Box 5.1 South-South Learning in Social Protection and Labor The SPL community, as one of the newest practices in the World Bank, has been very active in promoting and supporting South-South Learning, as demonstrated by the examples collected here. These efforts to facilitate South-South learning at all levels have been helping countries to share the secrets of success—and even failure— and as a result, enabled them to implement effective SPL policies and programs across the developing world.81 Social Investment Fund (SIF) networks. The �rst World Bank-�nanced SIF was the 1987 Bolivia Emergency Social Fund. By 1994, Latin American SIFs had formed a community of practice called Red Social (Social Network) and started exchanging information and experience on how to target communities, what types of subprojects to support, how to carry out social needs assessment, and so on. By 2000, the membership had grown to 33 SIFs, most of which had received World Bank �nancing in different instances. In 1997, through a World Bank grant of $311,000, Red Social created InterRED Social, a virtual platform of information and knowl- edge exchange. Similar developments took place in other regions. In 1998, seven SIFs in the Europe and Central Asia region formed the ECANet, with support provided by the World Bank ($285,000). ECANet membership doubled to 14 countries by 2005. Growing interest in cash transfers. Approved in March 2001, the Colombia Human Capital Protection Project (Familias en Acción) was the �rst CCT project �nanced by the World Bank. Familias en Acción was quickly followed by Jamaica Social Safety Net Project and Turkey Social Risk Mitigation Project (2001). By then, CCTs had started capturing the interest of client countries as they learned from the initial successes of Progresa (today’s Oportunidades) in Mexico and Bolsa Escola (today’s Bolsa Familia) in Brazil. To facilitate and promote their mutual learning about this emerging instrument, the World Bank supported bi-annual CCT conferences in Puebla, Mexico (2002), Sao Paulo, Brazil (2004), and Istanbul, Turkey (2006) in which hundreds of policy makers, practitioners, and global partner representatives participated. In LAC, this evolved into a CCT Community of Practice, for which the World Bank has been serving as a provider of a virtual meeting platform, using World Bank country of�ces facilities. A similar community is currently being formed among Anglophone African countries with Rapid Social Response (RSR) support (see below). SPL core courses. Every year, SPL has offered a two-week long core courses in its key thematic areas: pensions (since 1997), safety nets (since 2000), and labor (since 2003). Disability will be added in 2012. Courses are attended by an average of 75 participants, mainly practitioners and policy makers of World Bank client coun- tries. Because courses use actual case studies as teaching materials, participants naturally share their expertise and perspectives, and build networks of professionals. RSR-supported South-South learning forums. As part of its support to client countries to build SPL sys- tems, the World Bank has been organizing global South-South learning forums. The �rst forum was on the FFF (Finance, Food and Fuel) Crisis in Cairo, Egypt in 2009. Since 2010, thanks to support from Russia, Norway, and the United Kingdom, RSR trust funds have been able to fund forums in Arusha, Tanzania (2010: Making Public Works Work) and Addis Ababa, Ethiopia (2011: Building Resilient Social Safety Nets). Over 300 participants from more than 50 countries and global partner organizations have participated in these forums. In 2012, another global forum on jobs and labor market issues and an East-Asia/South-Asia knowl- edge forum on the use of ICT in SPL are scheduled to take place. The World Bank has also brokered and organized many country-to-country knowledge exchanges on issues ranging from high-level policy to nuts- and-bolts technical details. 46 RESILIENCE, EQUIT Y, OPPORTUNIT Y inclusion and resilience—how to sustainably expand in Romania and Moldova) increasingly supports opera- SPL coverage to reach vulnerable groups and ensure tions that explicitly establish a feedback cycle between the capacity to respond to crises. Building youth pro- �nancing and speci�c, measurable results agreed upon ductivity is also an issue in Africa and South Asia, with countries. This can potentially be developed further which face substantial challenges from a large popula- with the new program-for-results (P4R) lending instru- tion of youth who are entering the labor market, often ment. The design of lending operations need to be without the requisite skills to engage in productive increasingly informed by more results-oriented economic work. The youth bulge is also an issue for labor markets analysis (notably cost-bene�t and cost-effectiveness in MENA, as is low female labor force participation. analysis), coupled with references to available global evidence on development effectiveness (such as impact For both MENA and East Asia, a major challenge is evaluations or systematic reviews). In carrying out lend- ensuring systematic approaches to reduce the frag- ing, strengthening client M&E systems will play a central mentation of programs in its MICs, and setting up role in SPL programs and systems, so as to ensure that basic systems where these are less developed. data are effectively used to track progress, inform man- Eastern Europe and Central Asia is a heterogeneous agement decisions, and support transparency and region, where challenges include affordability, with accountability.82 transition economies struggling with pension reform in the face of an aging population and shrinking labor Central to country-tailoring is building institutional force, as well as inclusion of vulnerable groups (for and governance capacity. Identi�cation, payment example, the disabled or Roma). In LAC, most coun- and monitoring mechanisms, bene�ciary registries, tries are facing “second generation� systemic and simple measures to support accountability and challenges, calling for better harmonizing social assis- reduce error and fraud are all critical elements to a tance and social insurance approaches and ensuring results focus and cost-effectiveness. Institutional more effective crisis-responsiveness. The inclusion capacity also needs support, particularly with respect challenge in LAC is extending coverage of social insur- to coordination beyond the purview of individual pro- ance to the informal sector. grams, to expanding coverage (notably among poor and vulnerable populations), and to support effective The World Bank’s technical expertise and global governance through appropriate “rules, roles and knowledge is critical in helping countries design controls� governing public, private and nonformal SPL approaches appropriate for their contexts. (family or community) actors. 83 The World Bank’s engagement with countries would, thus, entail helping the government and other country There is also a need—especially for global part- actors in both the “architecture� and “engineering� of ners—to support governments in prioritizing country-speci�c SPL systems (Box 5.2)—from diag- cost-effective, scalable solutions that can be easily nostic analysis, strategy formulation and identifying implemented by existing institutions, including non- policy options, to advice on programs and policy government partners. This needs to be applied to designs and �nancing. But this sort of country-led making better use of existing resources, informed by engagement has to be grounded in a strong consider- detailed analysis of SPL program �nancing (existing ation of political economy across a range of issues, and projected), coupled with commitments to increas- from awareness of the opportunities for reform pre- ingly move �nancing for SPL on-budget to strengthen sented by crises, to sensitivity to how dif�cult it is to the government’s oversight and accountability.84 mobilize scare resources to invest in largely invisible SPL systems. And, as underscored later, it puts a premium on enhancing work across sectors and Collaborate across Sectors global partners to ensure alignment between the SPL and Actors system and national goals and mandates. In the inherently cross-sectoral �eld of SPL, A key aspect of the World Bank’s work with coun- effective results will require prioritizing coordination tries is the reliance on evidence and tangible results across sectors and across a range of actors, includ- in operations. SPL lending (such as recent operations ing global partners, national agents, and CSOs. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 47 Box 5.2 Architecture and Engineering: The World Bank’s Operational Services to Countries on SPL Systems The World Bank’s role in supporting countries in developing their SPL systems spans both the “architecture� and “engineering� aspects. Depending on the client needs, the World Bank could work with country authori- ties on �ve main areas, with capacity building integrated in every aspects of our assistance. “Architecture� 1. Diagnostically analyzing needs and evaluation of the effectiveness of existing SPL programs. 2. Formulating strategy and mapping the pathway from existing conditions to strategic goals. 3. Identifying policy options and articulating the structure of various programs to ensure policy consistency within the SPL system (including through South-South learning exchanges). “Engineering� 4. Devising detailed policy and implementation measures to deliver results and enhance performance, including instituting the “nuts and bolts� subprograms (such as databases and bene�ciary registries), devel- oping processes and procedures, institutionalizing M&E mechanisms, and examining policy coordination. 5. Financing programs and technical assistance to support pilots and scale-up, and packaging investment or program �nancing with TA and impact evaluation. COLLABORATION ACROSS SECTORS those workers productively, where reforms in private SPL systems are inherently multisectoral sector development are critical. in nature—sometimes because SPL objectives need other sectors’ instruments to be realized, Second, managing multifaceted challenges— and sometimes because SPL instruments serve such as jobs, climate change, crisis management the development objectives of other sectors. As a and poverty reduction—necessarily calls on result, to both meet their own goals and those of their multisectoral solutions, often with SPL playing a clients as a whole, World Bank teams will have to central role in these efforts. Indeed, social protec- work with those in other sectors to best realize these tion is known for its ability to forge effective important synergies. multisectoral solutions, drawing on experience, such as CCT programs that provide cash First, instruments outside the traditional purview of transfers linked to demand-side incentives to poor SPL are crucial to achieving resilience and oppor- households to invest in the health, education and tunity. For example, building skills needed for growth nutrition of their children. CCT programs have been and productivity involves a series of “steps� from early especially successful at reducing poverty while childhood development to education, job training, improving both school attendance, especially for entrepreneurship and labor market regulation, as illus- girls, and infants’ and children’s access to health trated in Box 5.3. Again, resilience for rural farmers services. Similarly, skills and training programs can be ensured not only with cash transfers, but with facilitate private sector activity by allowing �rms crop insurance and easy access to healthcare, where to expand with the right workers. other sectors within the World Bank have extensive expertise.85 And opportunity is not ensured just with Finally, the effectiveness of poverty reduction or accumulated human capital and supply-side interven- risk management efforts is often enhanced by tions in the labor market, but an economy and a combining interventions across sectors. For private sector that thrives and grows and employs example, while the Household Asset Building 48 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 5.3 STEP: A Multisectoral Framework for Building Skills and Enhancing Productivity Productivity & growth 1 2 3 4 5 Getting children Ensuring that Building Encouraging Facilitating labor off to the right all students learn job-relevant entrepreneurship mobility and start skills and innovation job matching A simple conceptual framework—STEP—can help policy makers, analysts, and researchers think through the design of systems to impart skills that enhance productivity and growth. The framework focuses on �ve interlinked steps: Step 1. Getting children off to the right start, by developing the technical, cognitive, and behavioral skills conducive to high productivity through early child development, emphasizing nutrition, stimulation, and basic cognitive skills. Step 2. Ensuring that all students learn, by building stronger systems with clear learning standards, good teachers, adequate resources, and a proper regulatory environment. Step 3. Building job-relevant skills that employers demand, by developing the right incentive framework for both pre-employment and on-the-job training programs and institutions. Step 4. Encouraging entrepreneurship and innovation, by creating an environment that encourages invest- ments in knowledge and creativity. Step 5. Matching the supply of skills with the demand, by moving toward more flexible, ef�cient, and secure labor markets is the �nal complementary step transforming skills into actual employment and productivity. SPL policies can play a critical role in fostering each of the �ve steps. CCT programs can help improve nutri- tional outcomes and improve school attendance (Steps 1 and 2). ALMPs and skills programs can address Step 3. Risk management programs and focused training can help promote Step 4. And providing effective SPL mechanisms that ease informational asymmetries and promote mobility are critical for Step 5. Source: World Bank (2010b). THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 49 Program (HABP) in Ethiopia had only a marginal Operational partnerships impact on agricultural productivity when imple- The World Bank has active engagement with mul- mented alone, when combined with the Productive tilateral agencies, including joint missions in client Safety Net Programme (PSNP) maize yields countries and collaboration at the country level on increased by 38 percent.86 speci�c SPL topics. These agencies include, among others, regional development banks, the ILO, Within the World Bank, the SPL sector has strong UNICEF, the United Nations Development collaboration with other key sectors that share Programme (UNDP), and the WFP. There have also objectives and instruments. Within the Human been a series of speci�c meetings and technical Development Network (HDN), SPL works with the workshops on the multiagency Social Protection education sector on shared agendas in skills develop- Floor, which have forged closer collaboration around ment, early child development, child labor, school this key initiative, notably around the goal of mutual feeding, and school access. With the health, nutrition learning and information exchange. and population sector, issues relating to nutrition, aging and demography, social protection, HIV/AIDS, Bilateral and regional partners will continue to be and social insurance are some areas of strong part- important as well, as they have been historically. nerships. With PREM and FPD, SPL has a strong These actors share a common vision, but often pro- analytical partnership on the broad jobs agenda, vide differentiated support to meet these goals, where the sectors work closely together on the newly responding to speci�c regional and country-speci�c created Jobs Knowledge Platform and on issues relat- challenges or objectives. Among many key partners, ing to self-employment and productivity. SPL has the World Bank’s SPL practice works closely in coun- strong links with PREM, as well in the areas of �scal tries with the United Kingdom’s DFID in Africa and sustainability, poverty targeting, and governance and Asia, the Australia’s aid agency in the East Asia and service delivery. With the Sustainable Development the Paci�c, the German Ministry for Economic Network (SDN), there are broad areas of collabora- Development and Cooperation (BMZ) and the tion around community-based development, youth German Society for International Cooperation (GIZ) issues, energy subsidies, and emerging collaborations in Africa and Asia, as well as other bilaterals from in the areas of livelihoods and adaptation to climate Europe, Canada, Japan, and the United States in change. And with FPD, there is also strong collabora- speci�c country contexts. Among emerging donors, tion around old-age pensions and �nancial literacy. Brazil is heavily engaged in helping provide technical Annex 5 shows the interaction of the SPL agenda assistance to African countries building safety net with other sectoral strategies of the World Bank. systems, and the Russian Federation has been an important partner, through the RSR fund, in helping COLLABORATION ACROSS ACTORS build SPL systems in the poorest countries. In the Partners working on SPL will need to rise to the area of disability, a Japanese PHRD grant for challenge of coordination on the design, imple- Disability and Development provides grants for proj- mentation, and evaluation of SPL programs and ects across developing countries, aimed at inclusion systems. Collaboration among partners is essential of persons with disabilities in development, ranging to strengthen national support and prioritization of from inclusive education to accessible public build- social protection and labor systems that are rel- ings, roads, and transport. Annex 6 presents a evant to country-context. The need for partnerships summary of select multilateral and bilateral agencies’ is more evident in LICs and fragile states where de�nitions and applications of social protection. catalytic funding and knowledge is urgently needed to improve programs and establish SPL systems to NGOs are also important World Bank partners in prepare for future crises, address current needs, helping implement the SPL agenda. A wide range and lay the foundation for shared growth. This sets of partners, from CSOs to academia and the private an agenda for World Bank partnerships with multi- sector, play different, complementary roles. As a case lateral and bilateral agencies, regional institutions in point, trade unions’ engagement in setting the as well as the private sector and civil society, global labor agenda has contributed to shaping core applied to both operations and knowledge. aspects of the strategy, including an emphasis on the 50 RESILIENCE, EQUIT Y, OPPORTUNIT Y global crises of poverty and rising inequality, the need new opportunities for leveraging engagement, to address coverage of informal sector workers and building on promising engagements, such as the labor market issues in LICs, and recognition of gen- following in youth employment, skills development, der dimensions of labor markets. NGOs active in jobs, and disability. SPL, such as Save the Children, the African Platform for Social Protection, HelpAge International, and the Ongoing knowledge partnerships with the Institute for Development Studies, are also valuable International Labour Organization (ILO) has global partners in providing sectoral expertise, advo- resulted in joint initiatives to produce an inventory of cacy partnerships and analytical depth to help in labor policy responses during the 2008-10 global implementing and realizing the SPL strategy across economic crises. The ILO is also a member of the client countries. Finally, civil society organizations Global Partnership for Youth Employment, which have had a key role in the design, monitoring and builds and disseminates evidence on youth employ- implementation of social protection programs around ment in Sub-Saharan Africa and the Middle East by the world and will continue to be an essential partner fostering new research, policy dialogue, and capacity in moving this agenda forward. building of local stakeholders. Members of the part- nership include Understanding Children’s Work The major partnership challenge is to join forces to (UCW), the Youth Employment Network (YEN) —both build foundational SPL systems in countries where interagency initiatives between the World Bank, ILO these are lacking, as exempli�ed by the RSR initia- and the UN—the Arab Urban Development Institute tive. This effort builds on the collaboration mobilized as (AUDI), and the International Youth Foundation (IYF).87 an urgent response to the pressing 2008-09 food, fuel, and �nancial crises (Box 5.4). The RSR initiative, The World Health Organization and the World Bank together with the Global Food Response Program and recently released the �rst-ever World Report on Japanese Social Development Fund, �nanced pro- Disability. Using data from the World Health Survey grams in 19 countries (mainly IDA) that had previously and the Global Burden of Disease, the report pro- received no safety net support. Today, the $61 million vides the �rst global estimates of persons with RSR fund �nanced by Russia, Norway, and the United disabilities since the 1970s, and it provides an over- Kingdom stands out as a prominent example of a suc- view of the status of disability in the world. cessful multilateral partnership, which will evolve to become the umbrella trust fund to support the imple- The “Employment and Development� initiative was mentation of this strategy. Since December 2009, created in 2006 by the World Bank and the Institute RSR has approved 70 projects/initiatives, primarily in for the Study of Labor (IZA) in Germany to stimulate LICs and fragile states. For example, in Burkina Faso, and promote research on jobs in LICs and MICs. The RSR is supporting a $550,000 program assessing the annual conference on employment and development feasibility of public works and cash transfer modalities, has become the premier event for researchers work- and designing key technical and operational features of ing on the issue, and the 7th annual conference is due a new safety net program, including poverty targeting, to take place in 2012 in New Delhi, India. Collaboration bene�ciary registry, payments and M&E. In Timor-Leste, will be continued with IZA on activities related to the $2.07 million supports the design and implementation Jobs Knowledge Platform,88 such as the “World of of a management information system (MIS) for cash Labor� joint training events and conferences that help transfer programs. And in Bangladesh, $2.8 million is push the knowledge frontier on employment issues in helping design a conditional-cash transfer program to the developing world. be implemented by local governments. There are several other important topic-speci�c Knowledge partnerships partnerships, �nanced by global partners through Partnerships are increasingly central to ensuring multidonor trust funds (MDTFs). A major analytical the flow of knowledge, particularly on the effec- initiative on measuring the cognitive, noncognitive, tiveness of various programs in meeting global and technical skills of the adult population, and the challenges. Under the strategy, the SPL sector will links between skills and labor market outcomes and sustain several key existing partnerships and look for �rm productivity, is being undertaken through the THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 51 Box 5.4 Preparing for the Next Crisis: Building SPL Systems with the Rapid Social Response Program The RSR Program was established as a World Bank response to the food, fuel, and �nancial crises. While it leverages larger IBRD and IDA resources, the core of RSR operations is the $61.7millon trust fund resources donated by Russia ($50m), Norway ($8.5m) and the UK ($3.2m). After four rounds of competitive selection processes, 100 percent of funds have been committed for 85 projects. RSR’s clients are low-income IDA eligible countries, for which 92 percent of committed funds are allocated in the form of country/region-speci�c direct technical assistance and pilot projects. The remaining 8 percent are used for knowledge management and transfer. Sub-Saharan Africa alone absorbs almost 50 percent of RSR trust fund resources. RSR provides catalytic resources in relatively small amounts to help low-income countries build SPL systems, so that they are ready to protect and invest in their populations in future crises. RSR trust fund �nancing has ranged from $40,000 to $3 million per project. This level of relatively small funding can effec- tively support system building efforts. In the medium- to long-run, it can then help to catalyze more resources as bene�ciary countries’ implementation capacity is upgraded. It should be noted that RSR does not support a stream of bene�t payments, except for small pilot projects. Instead, it helps construct systems that are capable of supporting a large number of bene�ciaries. RSR is demand-driven and results-oriented. One of the most important criteria for evaluating RSR funding proposals is implementability. This, by de�nition, requires strong client ownership even for relatively small- scale technical assistance projects. In order to ensure the proposal’s consistency with the World Bank’s overall strategy to assist the clients, the applicable World Bank Country Director’s of�ce is consulted from a very early stage of project concept development. Another key evaluation criterion is solid monitoring and evaluation (M&E) arrangements to ensure that the project, if approved for funding, will generate concrete results. RSR is flexible and speedy. RSR operational procedures have been designed to enable the World Bank to deploy necessary expertise quickly. The procedures are also designed for speedy-processing of grant proposals. It usually takes only two months or less from a call for proposals to the approval decision. RSR gives more time to its LIC clients by speeding up the processing on the side of the World Bank. RSR is making a difference. The recently completed evaluation of SSNs by the IEG of the World Bank made the following observations, “…resources to support SSNs and institution building and to stimulate country demand were lacking in LICs. As additional funds were provided through the RSR trust funds, engagement in LICs increased, and the World Bank and countries focused more on institutional strengthening.� For the World Bank’s SPL strategy, RSR is a central pillar in global partner efforts to make a difference in SPL in the poorer countries in the world, and to help prepare them to address the vulnerability of their populations against the inevitable shocks to come. As of January 31, 2012, $23.5 million in RSR resources was accompanied by $1.06 billion of World Bank loans and grants approved and in the pipe- line. These include, for example, $2 million to Tanzania on enhancing crisis response, complementing the $150 million Second Social Action Fund RSR grant; $2 million to DRC to build capacity to provide services to the vulnerable, complementing the $10 million Street Children RSR project; and $300,000 to Papua New Guinea on M&E and social accountability, complementing the $15.8 million Urban Youth Employment Project RST grant. Source: www.worldbank.org/rsr. 52 RESILIENCE, EQUIT Y, OPPORTUNIT Y combined resources of several trust funds, notably capacity to work on labor market issues. The Russian the MDTF on Job Creation89, the World Bank- Federation’s Financial Literacy and Education Trust Netherlands Trust Fund (BNPP) and the Russian Fund has, similarly, �nanced new and innovative Education Aid for Development (READ) Trust Fund. research on effective programs on �nancial capability. The MDTF for Global Partnership for Disability and Development (GPDD) �nanced by Finland, Norway, Cutting across a range of sectors, the Spanish/ and Italy supports activities of the partnership focused Strategic Impact Evaluation Fund (SIEF) has on knowledge creation and exchange. Another MDTF provided support to the results agenda by �nancing on Labor Markets, Job Creation & Economic Growth impact evaluations and related capacity building, (�nanced by Austria, Germany, the Republic of Korea, generating evidence in seven strategic areas, Norway, and Switzerland) has funded important ana- including CCTs, youth employment, ALMPs, lytical work on labor markets and helped build client and early childhood development. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 53 54 RESILIENCE, EQUIT Y, OPPORTUNIT Y 6. Measuring and Achieving Success: Expected Results and Business Plan Implications Measuring Results cannot be measured reliably today. Others are not available across countries. The success of the new strategy will be measured ■ Second, coherence in tracking results through a set of performance indicators reflective across World Bank SPL engagement. The of SPL goals and the strategy’s priority and prin- strategy results matrix indicators have been ciples. Progress on results will be regularly monitored aligned with other measures used within the using a results framework tracking impacts, outcomes, World Bank, including CPIA measures on SPL and outputs in partner countries, and World Bank systems performance, SPL core sector activities undertaken to advance strategy priorities and indicators (which have been developed in principles.90 The results framework follows a three-tier parallel with the strategy), IDA16 indicators, approach (Table 6.1 provides a snapshot and Annex 7 and corporate scorecard indicators, all in close a full presentation), which reflects the link between the collaboration with OPCS. World Bank’s programs and activities under the strat- ■ Third, an acknowledgment that egy, changes in country outcomes that could be coverage indicators linked to World Bank directly attributable to World Bank engagement, and engagement will likely reflect the strongly changes in medium- and long-term country develop- counter-cyclical nature of World Bank ment outcomes. Details about indicator measurement, lending. The indicators on the number aggregation, data sources, baseline values and of bene�ciaries of safety net and labor selected targets are provided in Annex 7. Indicators market programs, which will be measured will be regularly updated to track progress on strategy in the core sector indicators, should be results and to highlight areas that need attention, deci- expected to rise during crises when SPL sion, and action. lending has historically gone up, and fall when crises abate. Indicators will be tracked by gender and IDA-IBRD ■ Finally, a commitment to further develop the distinctions to ensure that progress is monitored indicators over time. Several indicators are closely across people and types countries. In addi- still in their infancy. Notably the systems tion, to ensure coherence in tracking results across indicators will have to be developed and World Bank SPL engagement, the strategy results re�ned over the next years, as will appropriate matrix indicators have been aligned with other mea- measures of World Bank engagement in policy sures used within the World Bank, including Country reform, including in social insurance. Policy and Institutional Assessment (CPIA) measures on SPL systems performance, SPL core sector indica- This implies that results of the strategy will be tors, and corporate scorecard indicators, all in close more accurately measured by indicators of quality collaboration with the Operations Policy and Country and of engagement, than by coverage and lending Services (OPCS). volumes, and that measures will be reviewed and updated over time. These measures include the qual- The selection of indicators in the strategy results ity of World Bank projects and the World Bank’s framework has been guided by four principles: ability to help countries access knowledge and techni- cal support to set up more effective approaches to ■ First, an emphasis on the quality and SPL that are more responsive to risk, inclusive, and availability of data. Many indicators on linked to opportunities. The indicators will be reviewed important aspects of performance, such as the and updated over time, with a thorough review impact of World Bank SPL knowledge work, planned for the 2017 �ve-year strategy update. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 55 Table 6.1 SPL Strategy Results at a Glance World Bank activities to support Outcomes and outputs of coun- Country progress partner countries tries receiving World Bank on sector development support outcomes ■ Percentage of satisfactory projects ■ Percentage of SPL lending ■ Share of working age population (IEG Ratings) operations supporting SPL systems accruing pensions rights ■ Percentage of projects with ■ Number of countries with SPL ■ Pension bene�ciaries to elderly (>60) satisfactory M&E (ICRs) engagement population ratio (old age, survivor, disability, and social pensions) ■ Number of downloads of SPL ■ Number of bene�ciaries of SSN knowledge products programs in IDA countries ■ Percentage of population in the poorest quintile covered by SPL ■ Number of countries involved in ■ Number of bene�ciaries of labor programs+ World Bank sponsored South-South market programs*+ learning events ■ Poverty gap at $1.25 per day (PPP) ■ Percentage of SPL staff time spent ■ Percentage of children (7-14) on cross support employed+ ■ Percentage of IDA lending operations ■ GDP per person employed having co�nancing partners ■ Ratio of youth/adult unemployment rate+ ■ Index of SPL system development Note: +disaggregated by gender; *proposed SPL Core Sector Indicators. Disaggregation by IDA/IBRD will be applied as appropriate. This matrix will be updated as appropriate to capture improved indicators as they become available, including measuring the impact of knowledge services. COUNTRY PROGRESS ON SECTOR An initial measure of World Bank support will be to DEVELOPMENT OUTCOMES track the number of client countries with World Bank Long-term development impacts are de�ned within SPL engagement, which is expected to increase, espe- the SPL objectives of improving resilience, equity, cially among IDA countries. Some of the strategy and opportunity. Indicators in tier I track results at the indicators in this area draw on the new SPL core sec- country level in these areas and provide the context tor indicators, which will be derived from investment and direction for the World Bank’s work in social pro- lending projects’ ISRs (implementation supervision tection. Although World Bank SPL engagement aims reports). They will, therefore, not be reflective of World to improve these indicators, changes in these indica- Bank SPL engagement through other lending instru- tors cannot be attributed to World Bank engagement. ments and knowledge products. These impact indicators are consistent with the MDGs and include pensions coverage measures (old age, Measuring progress in building SPL systems is a disability, survivors, and social pensions), the share of new agenda that will need development in the poor population covered by safety nets programs, years ahead. A central element of the World Bank’s poverty gap, and indicators of labor productivity, child current and future SPL engagement with countries is labor, and youth unemployment. to provide support for strengthening country institu- tions and fostering links across social protection CHANGES IN OUTCOMES AND OUTPUTS OF programs. Building social protection systems is com- COUNTRIES RECEIVING WORLD BANK SUPPORT plex and requires long-term engagement; therefore, it The results framework will track direct World Bank can be harder to measure how such systems are contributions to countries’ movement toward more practically implemented. The composition of the responsive, inclusive, and productive SPL systems. World Bank lending portfolio is expected to move 56 RESILIENCE, EQUIT Y, OPPORTUNIT Y towards supporting system-oriented operations, but entrepreneurship—supported by the World Bank will recognizes that entry points are often through serve as an output indicator to monitor World Bank engagement on individual projects. To track perfor- contributions to enhancing productivity and improving mance of countries in this area, the volume of lending labor market outcomes. and nonlending engagements explicitly aimed at sup- porting SPL system will be used as an indicator. Looking ahead, tools will have to be applied to assess Business implications the degree of integration, harmonization, and connec- tivity among SPL programs to ultimately provide WORLD BANK ACTIVITIES TO SUPPORT guidance on the type of reforms/policy recommenda- PARTNER COUNTRIES tions that can be considered in speci�c cases and to The strategy’s focus has implications for how the allow benchmarking social protection systems. SPL practice will engage in terms of managing its staff and conducting its business in the areas of Coverage is a challenging indicator that will likely knowledge, lending, and partnerships to help cli- continue to be highly countercyclical. It is a World ent countries achieve their development goals. Bank priority to help countries expand their coverage of public social protection programs, notably to reach Much of the challenge in this area will be to main- the poorest and most vulnerable. The number of ben- tain the sector’s high performance while taking e�ciaries of safety nets programs supported by the on more ambitious engagement. Target values are World Bank in IDA countries will be used as a mea- set for indicators in this domain as these indicators sure of progress to track increased coverage. By track performance in areas that the World Bank most contrast, in some IBRD countries—notably in the ECA directly controls and actions for which the World region—SPL reforms are aimed at re-orienting cover- Bank will be accountable (see Annex 7). While base- age and could involve some reductions in coverage of line values show that SPL is performing remarkably certain programs. A relative measure of coverage well - and above the World Bank average—the chal- (such as the coverage rate of the poor) would be lenge in the next years will be to maintain the high more informative but is fraught with measurement and quality of the SPL portfolio, M&E ratings and partner- comparability problems at the project level (though ship arrangements, and while at the same time this will be tracked at the country level). Moreover, the meeting the ambitious strategy goals. The formula- SPL portfolio is highly counter-cyclical, so World tion of targets in tier 3 reflects the expected increase Bank contributions to expanding coverage are in the three areas of operating principles identi�ed in expected to rise substantially in response to crises— the strategy—knowledge (reflected in knowledge and contract in normal times. As a consequence, the production and dissemination and South-South indicator measuring the number of safety nets bene�- sponsored learning events), collaboration (reflected ciaries of programs supported by the World Bank will indicatively at country level through co-�nancing reflect the portfolio counter-cyclicality. arrangements in IDA operations and at Bank level through intra-Bank cross-support), and country-tai- Improved access to jobs and earning lored operations, where they reflect the ambitious opportunities will be tracked by looking objective of keeping maintaining the high quality at the coverage of active labor market programs. performance and results-orientation of the portfolio The greater demand from clients for the “promotion� while expanding our lending engagement to chal- function of their social protection systems calls for an lenging contexts as in such as lower institutional expanded World Bank role in helping the most vulner- capacity countries and fragile states. able access jobs and earnings opportunities. Results in this area will track the expected increased cover- KNOWLEDGE age of labor market programs and “productive� safety In the knowledge area, the World Bank will con- nets programs experimenting with approaches to link tinue to be a leading global provider, disseminator, their bene�ciaries to activation/graduation services. and customizer of knowledge about effective SPL The number of bene�ciaries of labor market pro- approaches. As in the past decade, knowledge will grams—including programs fostering be based on generating evidence on performance THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 57 and then translating in-depth engagement at the The World Bank’s highly-regarded “core courses� country level into systematic global knowledge-shar- for clients on safety nets, pensions, and labor mar- ing. SPL will need to help address the knowledge kets will continue to evolve, using both more gaps on existing programs, program performance, and technology (such as web-based introductory courses) knowledge sharing, using the approaches discussed and more hands-on experience on program design in Section 5. The SPL “anchor� (as the global policy and administration. Impact evaluation training will also unit is called) will need to take a leading role in facili- be a priority for HDN through collaboration across tating a coordinated approach to knowledge, but in SPL, health, and education. Beyond these, the SPL close partnership and mutual learning with regions. practice will prioritize a deeper investment in making The anchor will continue to develop, strengthen, and knowledge more accessible, through the development disseminate knowledge tools that can be applied of easily digestible policy and “how-to� guides to across countries—including impact evaluations, mod- equip both staff and clients across the globe to make eling tools, and benchmark assessments to assess better policy decisions. what programs exist and how they perform (see Section 5 and the anchor discussion in Annex 1). As OPERATIONS the practice moves towards supporting SPL systems, In its operational work, the SPL strategy calls on there will be demand for new knowledge regarding teams to use evidence and be client-focused in how different programs can work together effectively, order to inform and support their development of recognizing that most of the knowledge today focuses tailored, effective, scalable solutions to the press- on programs working independently. ing demands for SPL. Client tailoring puts a premium on innovation, as well as attention to political The World Bank SPL practice will place greater economy issues and encourages creative, often multi- emphasis on knowledge dissemination and sectoral solutions. It also calls on World Bank SPL exchange. Knowledge exchange across countries and staff to use global evidence to inform policy dialogue staff will be a priority, especially drawing on face-to- and program design and to help clients develop pro- face South-South learning and ensuring access grams that will generate their own evidence on through knowledge platforms using web-based performance so as to better inform program design approaches. The SPL practice is committed to continu- and management in individual countries. ing to prioritize South-South knowledge exchanges, to share knowledge amongst practitioners, and to pro- The strategy’s focus matches well with the full mote exchange on design and implementation issues portfolio of World Bank �nancing instruments. relevant to current and future SPL agenda. Countries will be able to use those appropriate to the task at hand to couple catalytic funding with The practice will also improve virtual knowledge technical engagement in the design of effective sharing. The objective is to have accessible, clear operations. Sector investment loans and grants will web-based sites for each of the SPL areas of prac- continue to be needed, including investing in the tice, including safety nets, pensions, labor markets, basic administrative subsystems. Policy-based loans and SPL systems, which would allow information on and grants, a major element of World Bank SPL lend- evidence and good practice to be disseminated and ing, will also continue to support reforms that inform serve as a vehicle for supporting communities of more effective SPL approaches and help countries practice. The new Jobs Knowledge Platform has respond to �nancing needs during downturns. The been recently launched as a joint initiative of the new program for results (P4R) instrument is particu- HDN, PREM, FPD and DEC to facilitate knowledge larly well suited to the system-building agenda, as it sharing and best practice on how to tackle the chal- takes a results-focused view across programs. Finally, lenge of expanding job opportunities. World Bank technical assistance and capacity building will con- performance in disseminating knowledge will be tinue to serve as important complements. measured by the number of countries involved in South-South learning events, and the number of The strategy calls for a continued focus on quality downloads of World Bank knowledge products as a and results—two areas that have been hallmarks of the proxy for client demand for these products. SPL practice for the past decade. Quality project 58 RESILIENCE, EQUIT Y, OPPORTUNIT Y design and quality implementation are critical to ensur- typically well-versed and highly demanded by clients for ing operational impact. Indicators of portfolio quality their core areas of expertise (such as safety nets, pen- and performance for operations and AAA will be sions, or labor markets). However, as the strategy is tracked. Reinforcing the focus on results is key aspect implemented, they will need to develop new expertise of operational effectiveness. The results focus of SPL in three areas: taking a systems approach to engage- operations has been generally strong at appraisal, but ment; understanding how portfolios of programs can needs to be sustained throughout the operation and be better coordinated through sharing common admin- beyond. SPL has been at the forefront of using results- istrative subsystems; and harmonizing different types of based lending approaches over the past ten years, programs across labor markets, social assistance, and mostly in the context of CCT programs.91 Results- social insurance. Moreover, to better align staff skills based lending is likely to be in high demand by SPL with the systems vision, SPL operational and network clients in the next years, especially through such inno- teams will need to deepen expertise on the “nuts and vative �nancing instruments as the P4R. The bolts� of SPL systems drawing on the expertise of results-orientation of SPL projects will be tracked using experienced practitioners. IEG ratings and M&E performance ratings. SPL will continue to ensure that the staff is well PARTNERSHIPS trained in both core competencies and emerging A central element of the strategy is a call for areas, building on the global knowledge-sharing increased collaboration across sectors and global agenda. Staff will continue to access the global core partners to help countries develop more harmo- courses, which are primarily aimed at clients, but will nized, responsive approaches to risk. There are also help train sector staff. Staff located in country particular challenges and demands on partnerships in of�ces will be a particular focus, and SPL will develop IDA countries given resource constraints and the more online training modules, such as the one already need for aid harmonization. The results framework will pioneered for SSNs. reflect collaboration by measuring the percentage of projects in IDA countries that are co�nanced with To be effective, SPL will also need to ensure that other global partners. The practice is also likely to expert staff, in whom knowledge is embedded, are become more cross-sectoral, building on an existing mobile enough to serve all clients. This calls for two strong base of cross-sectoral engagement given the measures. First, ensuring that the World Bank’s global complementarities across sectors (see Annex 5). experts in SPL are made available to all clients. This will build on the success of the SSN Global Expert Partnerships will be central to helping countries Team (GET), which has allowed the World Bank’s build effective SPL programs and systems, par- practice leaders to provide key advice to clients and ticularly to respond to future crises. Further support develop global knowledge products. In addition, the for the RSR initiative (see earlier Box 5.4) will be a SPL Sector Board (recently recognized by IEG as the priority to help with this effort in LICs. The global part- best performing in the World Bank) will continue to nership will be supported through a regular annual ensure high-frequency cross-support—to ensure that dialogue with bilateral, multilateral, and civil society needed expert staff (whether in the regional practices partners. As a result of this dialogue, more joint or in the SPL anchor)—are effectively mobilized to approaches in LICs are expected to increase, and the ensure that clients receive the highest quality support. results matrix tracks this indicator as well. Cross support is already at 15 percent of staff time— well above the World Bank 3 percent average—and IMPLICATIONS FOR STAFFING AND BUDGETS this level will be maintained and tracked as a perfor- While SPL policy specialists will continue to be mance indicator. Second, the SPL practice will recruited to work within and across core areas of ensure that expert staff members also serve as techni- pensions, labor, markets and safety nets, staff with cal and operational mentors to more junior staff or a multidisciplinary orientation and diverse skills as those with less experience in relevant areas. well as practitioners with experience in designing and managing SPL programs will also be needed Additional internal World Bank budget is not to implement the strategy. SPL staff today are requested for implementing the strategy, but a THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 59 central catalyst for implementing a key aspect of in SPL, especially South-South. This funding is not the strategy would be the RSR umbrella trust fund, needed for World Bank operations, but critically for supporting systems-building (especially in lower- countries to meet their SPL goals, notably in IDA income countries) and global knowledge-sharing countries where �scal space is most constrained. Greater resilience, equity, and opportunity are essential for individuals and societies to prosper in the 21st century. This strategy lays out a roadmap for the World Bank to help client countries to invest in their people through effective SPL systems that reduce fragmentation, bolster responsiveness, ensure inclusion and promote productivity for all. The road ahead will be challenging, but this is a challenge that the world’s nations need to take up. With this strategy, the World Bank aims to chart a course that makes it an even more effective partner in this endeavor. 60 RESILIENCE, EQUIT Y, OPPORTUNIT Y References Aedo, C., and S. Nuñez. 2001. “The Impact of Training Policies in Latin America and the Caribbean: The Case of Programa Joven.� Washington, DC: ILADES/Georgetown University. Ahmed, Akhter, and others. 2006. “Interim Impact Evaluation of the Conditional Cash Transfer Program in Turkey: A Quantitative Assessment.� Washington, DC: International Food Policy Research Institute. Alatas, Vivi, Abhijit Banerjee, Rema Hanna, Benjamin A. Olken, and Julia Tobias. 2010. “How to Target the Poor: Evidence from a Field Experiment in Indonesia.� NBER Working Paper No. 15980. Cambridge: National Bureau of Economic Research. Alderman, Harold, ed. 2011. No Small Matter: The Impact of Poverty, Shocks, and Human Capital Investments in Early Childhood Development. Washington, DC: World Bank. Alderman, Harold, and John Hoddinott. 2007. “Growth-Promoting Social Safety Nets.� 2020 Focus Brief on the World’s Poor and Hungry People. Washington, DC: International Food Policy Research Institute. Alderman, Harold, and Ruslan Yemtsov. 2012. “Productive Role of Safety Nets.� Background paper for the Social Protection and Labor Strategy. Washington, DC: World Bank. Almeida, Rita, Juliana Arbelaez, Maddalena Honorati, Arvo Kuddo, Tanja Lohmann, Mirey Ovadiya, Lucian Pop, Maria Laura Sanchez Puerta, and Michael Weber. 2012. “Improving Access to Jobs and Earnings Opportunities: The Role of Activation and Graduation Policies.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Andersson, Camilla, Alemu Mekonnen, and Jesper Stage. 2009. “Impacts of the Productive Safety Net Program in Ethiopia on Livestock and Tree Holdings of Rural Households,� Environment for Development Discussion Paper Series, EfD DP 09-05, March 2009, available at http://www.rff.org/RFF/Documents/EfD-DP-09-05.pdf. Andrews, Colin, Maitreyi Das, John Elder, Mirey Ovadiya, and Giuseppe Zampaglione. 2012. “Social Protection in Low Income Countries (LICs) and Fragile Situations: Challenges and Future Directions.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Arnold, Margaret, and Cynthia Burton. 2011. “Protecting and Empowering Vulnerable Groups in Recovery.� Paper prepared for the World Reconstruction Conference, “Recovering and Reducing Risks after Natural Disasters,� Geneva, May 10-13. Arulpragasam, Jehan, Luisa Fernandez, Yasuhiko Matsuda, Rosechin Ol�ndo, and Matt Stephens. 2011. “Building Governance and Anti-Corruption in the Philippines’ Conditional Cash Transfer Program.� Philippines Social Protection Note No. 1. Manila: World Bank and Australian Government Aid Program. Attanasio, Orazio, Adriana Kugler, and Costas Meghir. 2008. “Training disadvantaged youth in Latin America: evidence from a randomized trial,� IFS Working Papers EWP08/01. London: The Institute for Fiscal Studies. Banerji, Arup, Robert Holzmann, Pierella Paci, Carmen Pages, Stefano Scarpetta, and Milan Vodopivec. 2008. “Miles to Go: A Quest for an Operational Labor Market Paradigm for Developing Countries.� Washington, DC: World Bank. Bassett, Lucy, Sara Giannozzi, Lucian Pop, and Dena Ringold. 2012. “Rules, Roles and Controls: Governance in Social Protection.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Baird, Sarah, Jed Friedman, and Norbert Schady. 2007. “Aggregate Income Shocks and Infant Mortality in the Developing World.� Policy Research Working Paper No. 4346. Washington, DC: World Bank. Baird, Sarah, Craig McIntosh, and Berk Ozler. 2010. “Cash or Condition? Evidence from a Cash Transfer Experiment.� Policy Research Working Paper No. 5259. Washington, DC: World Bank. Boeri, Tito, and Katherine Terrell. 2002. “Institutional Determinants of Labor Reallocation in Transition.� Journal of Economic Perspectives 16 (1, Winter): 51–76. Bonilla Garcia, A., and J. V. Gruat. 2003. Social Protection: A Life Cycle Continuum Investment For Social Justice, Poverty Reduction And Sustainable Development. Geneva: International Labour Of�ce. Bruni, Lucilla, Andrew Mason, Laura Pabon, and Carrie Turk. 2010. “Gender Impacts of the Global Financial Crisis in Cambodia.� Draft paper. Washington, DC: World Bank. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 61 Chamorro, Mariandrea, Jasmine Cho, Diane Coffey, Dane Erickson, María Elena, García Mora, Payal Hathi, Jenny Lah, and Piali Mukhopadhyay. 2009. “Holding Government to Account: The Case of the National Rural Employment Guarantee Act (NREGA) in Andhra Pradesh, India.� Policy Research Report. Princeton, NJ: Woodrow Wilson School of Public and International Affairs, Princeton University. Chawla, Mukesh, Gordon Betcherman and Arup Banerji. 2007. From Red to Gray: The “Third Transition� of Aging Populations in Eastern Europe and the Former Soviet Union. Washington, DC: World Bank. Chen, Shaohua, and Martin Ravallion. 2008. “The Developing World Is Poorer than We Thought, but No Less Successful in the Fight Against Poverty.� Policy Research Working Paper 4703. Washington, DC: World Bank. Chen, Shaohua, and Martin Ravallion. 2010. “Update to the Impact of the Global Crisis on the World’s Poorest.� Washington, DC: World Bank. Cho, Yoonyoung, David Margolis, David Newhouse and David Robalino. 2012. “Labor Markets in Middle and Low Income countries: Trends and Implications for Social Protection and Labor Policies.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Cox-Edwards, Alejandra. 2002. “Gender Effects of Social Security Reform in Chile.� World Bank Economic Review 16(3): 321-344. Dercon, Stefan, and Pramilla Krishnan. 2000. “In Sickness and in Health: Risk Sharing within Households in Rural Ethiopia.� Journal of Political Economy 108(4): 688-727. Devereux, Stephen, and Rachel Sabates-Wheeler. 2004. “Transformative Social Protection.� IDS Working Paper 232. Sussex: Institute of Development Studies. DFID (Department for International Development). 2011. Cash Transfers. Evidence Paper, Policy Division. London: DFID. Dorfman, Mark C. 2012. “Background Paper on Pensions.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Duflo, Esther. 2003. “Grandmothers and Granddaughters: Old Age Pensions and Intrahousehold Allocation in South Africa.� World Bank Economic Review 17 (1): 1-25. Dutta, Puja, Rinku Murgai, Martin Ravallion, and Dominique van de Walle. Forthcoming. Rozgar Guarantee? Assessing India’s Biggest Anti-Poverty Program in India’s Poorest State. Washington, DC: World Bank. European Union. 2010. Social Protection for Inclusive Development: A New Perspective in EU Co-operation with Africa. Brussels: European Union and Robert Schuman Centre for Advanced Studies, European University Institute. FAO (Food and Agriculture Organization of the United Nations). 2010. The State of Food Insecurity in the World: Addressing Food Insecurity in Protracted Crises. Rome: FAO. Fiszbein, Ariel, and Norbert Schady. 2009. Conditional Cash Transfers: Reducing Present and Future Poverty. Washington, DC: World Bank. Frankenburg, E., J. Friedman, T. Gillespie, N. Ingwersen, R. Pynoos, I.U. Rifai, I.U. Sikoki, B. Sikoki, A. Steinberg, C. Sumanri, W. Suriastini, and D. Thomas. 2008. “Mental Health in Sumatra after the Tsunami.� American Journal of Public Health 98(9): 1671-1677. Friedman, Jan, and Duncan Thomas. 2007. “Psychological Health before, during and after a Crisis: Results from Indonesia, 1993-2000.� Policy Research Working Paper 4386. Washington, DC: World Bank. Garcia, Marito and Charity Moore. 2012. The Cash Dividend: The Rise of Cash Transfer Programs in Sub-Saharan Africa. Directions in Development. Washington, DC: World Bank. Garibaldi, Pietro, and Zuzana Brixiova. 1998. “Labor Market Institutions and Unemployment Dynamics in Transition Economies.� IMF Staff Papers 45(2): 269–308. Washington, DC: IMF. Giles, John, and Elan Satriawan. 2010. “Protecting Child Nutrition Status in the Aftermath of a Financial Crisis.� Policy Research Working Paper No. 5471. Washington, DC: World Bank. Goldstein, Markus. 1999. “Chop Time, No Friends: Intrahousehold and Individual Insurance Mechanisms in Southern Ghana.� Berkeley, CA and New Haven, CT: University of California at Berkeley and Yale University. Grosh, Margaret, Carlo del Ninno, Emil Tesliuc and Azedine Ouereghi. 2008. For Protection and Promotion: The design and implementation of effective safety nets. Washington, DC: World Bank. Growth Commission. 2010. “Post-Crisis Growth in Developing Countries: A Special Report of the Commission on Growth and Development on the Implications of the 2008 Financial Crisis,� available at www.growthcommission. org. 62 RESILIENCE, EQUIT Y, OPPORTUNIT Y . 2008. “The Growth Report: Strategies for Sustained Growth and Inclusive Development,� available at www. growthcommission.org. Guhan, Sanjivi. 1994. “Social Security Options for Developing Countries.� International Labour Review 133(1): 35-53. Haddad, Lawrence, John Hoddinot, and Harold Alderman, eds. 1997. Intrahousehold Resource Allocations in Developing Countries: Models, Methods, and Policy. Baltimore, MD: The Johns Hopkins University Press. Hale, Galina, Assaf Razin, and Hui Tong. 2009. “The Impact of Creditor Protection on Stock Prices in the Presence of Credit Crunches.� NBER Working Paper No. 15141. Cambridge: National Bureau of Economic Research. Heckman, J. J., and D. V. Masterov. 2007. “The Productivity Argument for Investing in Young Children.� NBER Working Paper 13016. Cambridge: National Bureau of Economic Research. Heckman, James. 2008. “Schools, Skills and Synapses.� Economic Inquiry 46(3): 289-324. Holzmann, Robert, and Steen Jørgensen. 2000. “Social Risk Management: A New Conceptual Framework for Social Protection and Beyond.� Social Protection Discussion Paper No. 0006. Washington, DC: World Bank. Holzmann, Robert, David Robalino, and Noriyuki Takayama, eds. 2009. Closing the Coverage Gap: the Role of Social Pensions and Other Retirement Income Transfers. Washington, DC: World Bank. Holzmann, Robert, and Richard Hinz. 2005. Old Age Income Support in the 21st Century: An International Perspective on Pension Systems and Reform. Washington, DC: World Bank. Holmes, Robecca, and Nicola Jones. 2011. “Gender Inequality, Risk and Vulnerability in the Rural Economy: Refocusing the Public Works Agenda to Take Account of Economic and Social Risks.� ESA Working Paper No.11-13, March. Rome: Agricultural Development Economics Division, FAO. Honorati, Maddalena, Laura Rawlings, and Julie Van Domelen. 2011. “Results-Based Lending Approaches in Social Protection and Labor.� Social Protection and Labor Policy Note No. 1. Washington, DC: World Bank. Honorati, Maddalena, Federica Marzo, Hideki Mori, Laura Rawlings, Sophie Warlop, Briana Wilson, and Karla McEvoy. 2012. “Portfolio, Evolutions and Results.� Draft Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. IEG (Independent Evaluation Group). 2008. Using Knowledge to Improve Development Effectiveness: An Evaluation of the World Bank Economic and Sector Work and Technical Assistance, 2000-2006. Washington, DC: World Bank. _. 2011a. Social Safety Nets: An Evaluation of World Bank Support, 2000–2010. Washington, DC: World Bank. . 2011b. Evidence and Lessons Learned from Impact Evaluations on Social Safety Nets. Washington, DC: World Bank. . 2011c. “The Matrix System at Work: An Evaluation of the Bank’s Organizational Effectiveness.� Preliminary draft for discussion; November. Washington, DC: World Bank. IFPRI/CSA (International Food Policy Research Institute/Central Statistical Agency). 2009. Ethiopia Productive Safety Net Program Impact Assessment. Washington D.C. and Addis Ababa: IFPRI and Government of Ethiopia. ILO (International Labour Organization). 2005. “Social Protection as a Productive Factor�. Working Paper GB.294/ ESP/4 by the Governing Body, Committee on Employment and Social Policy. Geneva: ILO. . 2011a. Social Protection Floor for a Fair and Inclusive Globalization: Report of the Social Protection Floor Advisory Group. Geneva: ILO. . 2011b. Social Security for Social Justice and a Fair Globalization. Report VI – Recurrent Discussion on Social Protection (Social Security) under the ILO Declaration on Social Justice for a Fair Globalization, 2011. Geneva: ILO. IPCC (Intergovernmental Panel on Climate Change). 2011. “Summary for Policymakers�. In Intergovernmental Panel on Climate Change Special Report on Managing the Risks of Extreme Events and Disasters to Advance Climate Change Adaptation, eds. C. B. Field, V. Barros, T. F. Stocker, D. Qin, D. Dokken, K.L. Ebi, M. D. Mastrandrea, K. J. Mach, G. K. Plattner, S. K. Allen, M. Tignor, and P. M. Midgley. Cambridge and New York: Cambridge University Press. James, Estelle, Alejandra Cox-Edwards, and Rebeca Wong. 2008. The Gender Impacts of Social Security Reform. Chicago: University of Chicago Press. Khandker, Shahidur R. 1998. Fighting Poverty with Microcredit. New York: Oxford University Press. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 63 Kuddo, Arvo. 2009. “Employment Services and Active Labor Market Programs in Eastern European and Central Asian Countries.� SP Discussion Paper 0918. Washington, DC: World Bank. Kuriakose, Anne T., Rasmus Heltberg, William Wiseman, Cecilia Costella, Rachel Cipryk, and Sabine Cornelius. 2012. “Climate-Responsive Social Protection.� Concept Note for the Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Lancet. 2011. “Early Child Development—A Winning Combination.� The Lancet 378 (9799): 1276. Leite, Phillippe. 2011. “Reducing Inequality: The Role of Reforms in Brazil.� Georgetown Journal of International Affairs 12(1): 118-124. Lunderg, Shelley J., Robert A. Pollak, and Terence J. Wales. 1997. “Do Husbands and Wives Pool Their Resources? Evidence from the United Kingdom Child Bene�t.� Journal of Human Resources 32(3): 463-80. Grosh, Margaret, Carlo del Ninno, Emil Tesliuc, and Azedine Ouerghi. 2008. For Protection and Promotion: the Design and Implementation of Effective Safety Nets. Washington, DC: World Bank. Marzo, Federica, and Hideki Mori. 2012. “Crisis Response in Social Protection.� Concept Note for the Background Paper prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Menon, Nidhiya. 1999. “Micro Credit, Consumption Smoothing and Impact of Repayment Behavior: An Euler Equation Approach.� Brown University, Department of Economics, Providence. Mitchell, Tom, and Maarten van Aalst. 2011. “Headlines from the IPCC Special Report on Extreme Events.� The Netherlands: Overseas Development Institute and Red Cross/Red Crescent Climate Centre. OECD (Organisation for Economic Co-operation and Development). 2009. Promoting Pro-Poor Growth: Social Protection. Paris: OECD. Parry, M.L., O.F. Canziani, J.P. Palutikof, P.J. van der Linden and C.E. Hanson, eds. 2007. Contribution of Working Group II to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge: Cambridge University Press. Posarac, Aleksandra, Karen Peffley and Cecilia Costella. 2012. “The Inclusion of Disability in Social Protection Projects 2000-2010 Portfolio Review.� Note prepared for the Social Protection and Labor Strategy 2012-22. Washington, DC: World Bank. Quisumbing, Agnes R., and Yisehac Yohannes. 2004. “How Fair is Workfare? Gender, Public Works, and Employment in Rural Ethiopia.� Policy Research Working Paper 3020. Washington, DC: World Bank. Ravallion, Martin. 2009. “The Developing World’s Bulging (but Vulnerable) ‘Middle Class’.� Policy Research Working Paper 4816. Washington, DC: World Bank. Rawlings, Laura, Lynne Sherburne-Benz, and Julie Van Domelen. 2004. “Evaluating Social Funds: a Cross Country Analysis of Community Investments.� Regional and Sectoral Studies No. 27834. Washington, DC: World Bank. Rawlings, Laura, Maddalena Honorati, Gloria Rubio, and Julie Van Domelen. 2011. “Results Readiness in Social Protection & Labor Operations.� Social Protection Discussion Paper No. 1107. Washington, DC: World Bank. Robalino, David A., Laura Rawlings and Ian Walker. 2012. “Building Social Protection and Labor Systems: Concepts and Operational Implications�. Background Paper prepared for the Social Protection and Labor Strategy 2012- 2022. Washington, DC: World Bank. Rose, Elaina. 1999. “Consumption Smoothing and Excess Female Mortality in Rural India.� Review of Economics and Statistics 81(1): 41-49. Rubio, Gloria. 2011. “The Mexican Government’s M&E System.� World Bank PREM Note 14: 1-10. Sabates-Wheeler, Rachel, and Stephen Devereux. 2008. “Transformative Social Protection: the Currency of Social Justice.� In Social Protection for the Poor and the Poorest: Concepts, Policies and Politics, eds. Armando Barrientos and David Hulme. Basingstoke: Palgrave Macmillan. Soares, S. 2010. “Distribuição de Renda entre 1995 e 2009,� Comunicado IPEA, No. 63, IPEA. Stiglitz, Joseph. 1998. “Lessons of the Asia Crisis.� Financial Times, December 3. Strauss, John, and Duncan Thomas. 2008. “Health over the Life Course.� In Handbook of Development Economics, ed. T. Paul Schultz and John A. Strauss, Vol. 4, 3375-3474. Elsevier. Subbarao, Kalanidhi. 2003. “Systemic Shocks and Social Protection: Role and Effectiveness of Public Works Programs.� Social Protection Discussion Paper No. 0302. Washington, DC: World Bank. 64 RESILIENCE, EQUIT Y, OPPORTUNIT Y Subbarao, Kalanidhi, Carlo del Ninno, Colin Andrews, and Claudia Rodriguez. Forthcoming. Public Works Programs: Design, Evidence and Implementation. Washington, DC: World Bank. Taylor, Viviene. 2009. “Social Protection in Africa: An Overview of the Challenges.� Report prepared for the African Union. UNICEF (United Nations Children’s Fund). 2011. State of the World’s Children 2011: Adolescence-An Age of Opportunities. New York: UNICEF. United Nations. 2010. The Millennium Development Goals Report 2010. New York: United Nations. Van Domelen, Julie. 2011. “Results Readiness in Social Protection & Labor Operations: Technical Guidance Notes for Social Funds Task Teams.� Social Protection Discussion Paper No. 1104. Washington, DC: World Bank. Van Domelen, Julie, and Laura Rawlings. 2012. “Social Protection Strategy: Stocktaking of International Agency Policies and Programs in Social Protection.� Note prepared for the Social Protection and Labor Strategy 2012- 22. Washington, DC: World Bank. Waters, Hugh, Fadia Saadah, and Menno Pradhan. 2003. “The Impact of the 1997–98 East Asian Economic Crisis on Health and Health Care in Indonesia.� Health Policy and Planning 18 (2): 172–81. World Bank. 2001a. Engendering Development: Through Gender Equality in Rights, Resources, and Voice. World Bank Policy Research Report. New York: Oxford University Press . 2001b. Social Protection Sector Strategy Paper: From Safety Net to Springboard. Washington, DC: World Bank. . 2003. World Development Report 2004: Making Services Work for the Poor People. New York: Oxford University Press. . 2005. World Development Report 2006: Equity and Development. New York: Oxford University Press. . 2010a. World Development Report 2011: Conflict, Security and Development. Washington, DC: World Bank. . 2010b. Stepping Up Skills for More Jobs and Higher Productivity. Washington, DC: World Bank. . 2011a. The Jobs Crisis: Household and Government Responses to the Great Recession in Eastern Europe and Central Asia. Washington, DC: World Bank. .2011b. “Building Resilience and Opportunity: 2012-2022 Social Protection and Labor Strategy of the World Bank – Preliminary Outline.� Powerpoint for consultations, October 7, Washington, DC: World Bank. .2011c. World Development Report 2012: Gender Equality and Development. Washington, DC: World Bank. .2011d. “Building Resilience and Opportunity: The World Bank’s Social Protection & Labor Strategy 2012-2022, Concept Note.� January. Washington, DC: World Bank. .2012. Global Economic Prospects: Uncertainties and Vulnerabilities, Vol. 4, January. Washington, DC: World Bank. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 65 Annexes 66 RESILIENCE, EQUIT Y, OPPORTUNIT Y Annex 1: Regional and Anchor Applications of the Social Protection and Labor Strategy The strategy will need to be adapted to �t strategy and knowledge services. Given the chal- demands and priorities across different clients lenges of being too speci�c about particular and contexts—reflected in the World Bank’s differ- contexts, these approaches take a �ve- rather than ent regional SPL practices. This section presents a ten-year perspective, which will be updated during summary of the main challenges, objectives, and cor- the midterm review of this strategy. responding areas of focus for the World Bank’s SPL practice in the coming years in each of the six regions The regional approaches reflect the variety and of World Bank engagement. It also presents an over- nuance of the World Bank’s global SPL practice, view for the World Bank’s Social Protection and but also underscore the common themes Labor anchor unit, a global policy center which serves stemming from the strategy’s main goals, the regional teams, providing support on policy, priorities, and principles. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 67 AFRICA REGION (AFR) Focus area Challenges Objectives Bank SPL practice SPL ■ Limited coverage and little or no ■ Help countries develop programs that ■ Provide an evidence base for policy and SYSTEMS coordination between programs, can be part of a SPL system. programmatic reforms in support of SPL resulting in highly fragmented SPL systems through (i) better understanding ■ Support country-owned national SPL systems. Very few systems are able to appropriate safety nets in Africa, (ii) systems, by scaling up effective SPL scale in response to crises. expanding safety net assessments to programs in coordination with other SPL assessments where possible; (ii) development partners. strengthening poverty assessments to ■ Promote institutional development and include analyses of chronic and transitory the move to SPL systems through the poverty and vulnerability to inform SPL use of common ‘building blocks,’ such as programming; (iii) conducting regional single bene�ciary registry, uni�ed MIS, studies, such as the one on targeting; and harmonized targeting systems, and (iv) continuing to invest in impact among others; and advance the use of evaluations to inform policy and program ICT. reform and design. ■ Support country efforts to strengthen the policy environment for SPL through creation and/or revision of national SPL policies and strategies, to establish and expand SPL systems; and to share experience across countries in the region. SOCIAL ■ Safety net instruments, while growing in ■ Consolidate and expand the coverage of ■ Expand the use of SPL assessments as SAFETY coverage, tend to be small, fragmented, existing small programs to create the basis for an informed dialogue on NETS and largely donor-driven, although there sustainable, predictable safety nets, reforms of price subsidies and other are some notable exceptions in the particularly cash transfers and public ineffective safety nets. region. Moreover, humanitarian relief is works, and to build their long-term ■ Support impact evaluations to generate the most prevalent form of assistance for scalability and crisis response capacity. information on approaches that work in poor populations in many African ■ Over time, integrate these programs into Africa to inform program scale-up and countries. Price subsidies continue to be national SPL policies and systems, expansion, to assess the relative used in many places. including continuing to invest in social effectiveness of CCTs and UCTs in this ■ Deep inequalities in access to basic funds as an important social protection context, and to support South-South social services continue. Targeted instrument, particularly in fragile and learning to promote best practices. demand- and supply-side interventions post-conflict states. ■ Provide �nancial support and technical are, therefore, needed to close the assistance to SSN programs in a coverage gap. Targeted service delivery number of countries across the has proven to be particularly effective at continent. delivering results in fragile states and post-conflict settings. ■ Support learning among countries, including fragile and post-conflict states, on basic service delivery instruments. The focus is on the evolution of long- established social funds into institutions that can help manage and deliver permanent SPL programs. 68 RESILIENCE, EQUIT Y, OPPORTUNIT Y AFRICA REGION (AFR) Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ The majority of countries in Africa spend ■ Provide social protection for older ■ Enhance cross-sectoral work within the SOCIAL less than 1 percent of GDP on pensions people through a multipillar system World Bank to support, in appropriate INSURANCE and fewer than 10 percent of older approach by reforming mandatory country contexts, pension programs that people receive a contributory pension. contributory schemes to make them can address contributory and non- Pensions are a signi�cant �scal concern �scally affordable, expanding pensions to contributory schemes. If requested by in many countries. In response to these the informal sector, and introducing clients, work with them to harness (and other) considerations, various noncontributory social pensions. existing evidence and practice to inform countries have enacted pension reforms policy and develop links between safety in recent years and some are seeking to nets and insurance. expand coverage to the informal sector. ■ Social security coverage in Africa is extremely limited. LABOR ■ Unemployment and underemployment ■ Promote market-based skills ■ Advance the analytical agenda on MARKETS rates, particularly among youth that development for the poor, particularly in employment in Africa, focusing represent a large share of the population, the informal sector, and to enable particularly on youth unemployment, to are high in most Africa countries and household enterprises and inform policy and practice. The Bank is there is a strong demand to address entrepreneurship that will strengthen supporting a number of youth these issues from client countries. livelihoods and help them rise out of employment projects that, together with poverty. rigorous impact evaluations, will provide ■ The applicability of ALMP-type programs much needed information on what works to African setting is debated because of in this area. the characteristics of African labor markets and the limited evidence base on the effectiveness of such approaches in Africa. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 69 EAST ASIA AND THE PACIFIC REGION (EAP) Focus area Challenges Objectives Bank SPL practice SPL ■ SPL interventions are often disjointed, ■ Assist countries in developing an ■ Facilitate sharing of relevant lessons SYSTEMS lack common institutional and policy ef�cient, equitable, and inclusive SPL from ongoing engagement in the region underpinnings, have limited M&E. system and, in particular, help (i) develop and from international experience; and a strong institutional basis, including engage in South-South learning on ■ Weaknesses in decentralization, public common targeting, uni�ed bene�ciary practical approaches toward SPL �nance management, or social registries, single payment systems, and system development. accountability hamper SPL policies and harmonized institutional arrangements; program performance. ■ Develop regional thematic knowledge and (ii) promote policy coordination, work in the areas of labor markets, SSN, accountability for policy implementation �scal/ governance, social insurance, and program performance, and skills, impact evaluation, and gender. harmonization across programs. ■ Strive to develop complementarity in ■ Assist countries to connect top-down policy dialogue and operations between reforms, such as those in public sector SPL and other sectors, especially public management, governance and public sector/ governance, and social �nance, with bottom up approaches on accountability. the SPL agenda. In collaboration with other sectors, help clients identify and address external problems impeding progress on SPL, and strengthen accountability for results in SPL. SOCIAL ■ Majority of population are vulnerable to ■ Support new and strengthen existing ■ Tailor “how-to� toolkits on the nuts & SAFETY shocks, particularly with respect to rising programs, such as community-based bolts of SSNs. NETS employment shocks, natural disasters, programs, cash transfers, basic health ■ Promote learning and innovation on economic volatility, and other covariate coverage programs, public works, addressing marginalized groups’ access shocks. Policy makers demand strong school feeding, and disaster relief. to services. links between SSN and productivity. ■ Provide “how-to� assistance on ■ Integrate SSN dialogue into the broader ■ The majority of SSN bene�ts do not reach targeting, bene�t structure, program inclusive growth agenda and tailor the lowest income quintile. implementation, and evaluation. advice on technical design and ■ Improve ef�ciency and effectiveness of institutional development, with possible large-scale programs, including operational support. strengthening their links to productivity. ■ Promote innovative approaches to increase access of marginalized groups to essential social services, and address the widespread vulnerability to covariate shocks. 70 RESILIENCE, EQUIT Y, OPPORTUNIT Y EAST ASIA AND THE PACIFIC REGION (EAP) Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ Social insurance schemes are often ■ Assist countries to consolidate and ■ Build and share knowledge on SOCIAL fragmented and inef�cient, in some integrate social insurance in the broader approaches for extending social INSURANCE countries coverage is still limited, bene�ts SPL policy dialogue and agenda giving insurance and old-age support to the can be regressive and dif�cult to sustain. priority to insurance expanding coverage informal sector. (health, unemployment, and old age), ■ Integrate social insurance in the broader and addressing bene�t uniformity and SPL agenda. portability, cost and competitiveness, informality, and policy coordination with ■ Continue to deepen policy dialogue social assistance. across countries, identifying further opportunities for effective technical and ■ Support reforms to reduce operational support. fragmentation and enhance coverage, particularly extending social insurance programs to the informal sector, and build on the existing programs to improve ef�cacy and develop a cohesive social insurance system. LABOR ■ Growth of working age population is ■ Work with multiple stakeholders to ■ Generate new knowledge and deepen MARKETS slowing down in East Asia, but labor promote a better understanding of labor policy dialogue through regional productivity has been growing steadily, in markets at subregional and country level. analytical work on jobs. part, reflecting moves out of agriculture. ■ Assess labor policy and regulations in ■ Build on the rich skills policy dialogue, ■ The share of wage employment has also the context of ASEAN integration. sharing policy lessons and linking the been increasing, while the share of unpaid dialogue with the broader SPL agenda. ■ Assist countries to integrate the labor family work has fallen. and youth agenda with the skills, ■ Unemployment problems, including migration, and country economic among youth, are less prevalent than in development agendas. other regions. ■ Enhance skills development systems ■ The concern is with equality of opportunity and consider the expansion of ALMPs and outcomes, and the fact that workers targeted to vulnerable workers. are vulnerable to shocks. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 71 EUROPE AND CENTRAL ASIA REGION (ECA) Focus area Challenges Objectives Bank SPL practice SPL ■ While most ECA countries operate ■ Improve the equity, ef�ciency, and ■ At country level: Sustained engagement to SYSTEMS extensive and expensive SPL systems, sustainability of SPL systems, through (i) support capacity building, institutional these systems are largely fragmented, improved coordination and harmonization strengthening and improvements in with multiple schemes within each area of SPL policies and programs across the bene�ts administration/ revenue collection, and with few links across the spheres. broad areas of social insurance, social and oversight and controls. assistance, activation, and labor; and (ii) ■ Inadequate opportunities for inclusion, ■ At country level: Broader diagnostics of strengthened governance of SPL lack of access to integrated services, social protection systems (expenditure systems, including management, and inequitable/ inef�cient social and �nancing) to support technical implementation, administration, bene�ts. assistance and dialogue on coordination monitoring, evaluation, oversight, and and incentive compatibility across controls. spheres, as well as linkages to broader ■ For speci�c excluded and vulnerable economy. groups, such as the Roma and people ■ Knowledge priorities at regional level: (a) with disabilities: opportunities for social insurance/pension systems regional employment, skills development and study; (b) effective approaches for productivity, and access to social governance, bene�ts administration services (promotion agenda), and systems and oversight/ controls. effective social bene�ts (social assistance, protection). ■ For speci�c vulnerable groups: (i) Building evidence-base on effective Roma inclusion policies. (ii) develop and share knowledge (Continued) on disability bene�ts administration, disability certi�cation, and active inclusion. SOCIAL ■ Social assistance systems are often ■ Consolidate social assistance programs ■ Regional knowledge areas: monitoring SAFETY fragmented and inef�cient, provide and strengthen governance expenditures, programs and performance; NETS inadequate support to key poor and (administration, oversight and controls, monitoring response of social bene�ts to vulnerable groups, including in times of M&E) to improve ef�ciency and equity in crises; “nuts-and-bolts� of SSNs (MIS, crisis. the face of �scal constraints, political oversight and controls); political economy; pressures, and competing social and incentive effects of social assistance ■ Many “passive� entitlements that can demands; programs. result in transfer dependency and work- disincentives without effective links to ■ Promote inclusion of speci�c excluded ■ At country level: sustained engagement to employment and other social services. and vulnerable groups (for example, the strengthen capacity and improve Roma or people with disabilities). effectiveness of SSN programs in LICs and MICs through lending instruments and AAA and in MICs through fee-based services (FBS). 72 RESILIENCE, EQUIT Y, OPPORTUNIT Y EUROPE AND CENTRAL ASIA REGION (ECA) Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ Given demographic pressures and the ■ Signi�cant and sustained reforms to ■ Regional analytical work on social SOCIAL shrinking labor force, public pension pension systems across the region, to insurance and pension systems; review of INSURANCE systems in ECA are �scally address issues of coverage and effective governance and administration of unsustainable. informality, adequacy (social pensions vs. services, bene�ts and revenue systems; income replacement; public vs. private and sustained monitoring of core indicators ■ Reforms are politically challenging—and savings), and �scal sustainability for pensions. frequently subject to reversals—given (affordability). high social expectations and the political ■ Sustain engagement through lending, AAA, weight of the large number of current and FBS, including functional SPL reviews, pensioners as countries refocus their limited pension spending on the most vulnerable to provide basic bene�ts. ■ Promote knowledge-sharing between reformed and reformer countries, drawing on the regional study on social insurance and pensions with empirical review of reform experience and lessons-learned. LABOR ■ Low labor-force participation, skills, and ■ Increase employability, productivity, and ■ Develop and apply diagnostic tools both MARKETS productivity. skills and labor-force mobility regionally and for speci�c countries on effective interventions to promote ■ Shrinking labor force in face of ■ Reduce dependency on social transfers activation-bene�ts links demographic decline. and improve employability by encouraging effective “activation� to support and ■ Promote knowledge sharing (with other ■ Expensive “passive bene�ts systems� incentivize people to get jobs and MICs/LICs and experience from OECD create work disincentives, and contribute productively to society, with a countries) on activation. compromise the opportunity of many focus on the “active inclusion� of the citizens to achieve their full social and ■ Conduct a regional “Jobs Study� planned unemployed, the “work-able� bene�ciaries economic potential. as companion to the global World of social assistance, youth, the elderly (as Development Report. retirement ages are increased), and speci�c vulnerable groups. ■ Carry out skills and employment surveys/ AAA. ■ Support crisis/ labor-market monitoring, skills-employment diagnostics, efforts to incentivize labor participation, analysis and reforms of labor markets, and activation approaches. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 73 MIDDLE EAST AND NORTH AFRICA REGION (MENA) Focus area Challenges Objectives Bank SPL practice SPL ■ Big share of government budgets ■ Move away from fragmented SPL ■ Improve targeting to increase program SYSTEMS devoted to subsidies. programs to systems, including (i) effectiveness. effective SSNs (for example, targeting of ■ Programs are fragmented and ■ Support the design and implementation cash assistance and workfare programs) uncoordinated. of (i) social funds, to address challenges and (ii) comprehensive ALMPs that across sectors in a participatory manner, ■ Segmentation in the labor market promote increased coordination across thus promoting coordination across accounts for jobless growth. government agencies. ministries and laying the ground for the ■ Weak information systems that hinder design of a SPL system; and (ii) front effective targeting (bene�ciary of�ce SPL services– one-stop shops, to identi�cation) and M&E. improve ef�ciency in labor market ■ Low capacity of government and processes. nongovernment agencies. SOCIAL ■ Existing SSN programs are highly ■ Short-term: scale up existing programs in ■ Improve understanding of SSN issues SAFETY inef�cient; they are based on noncash countries where SSN infrastructure is and programs through regional analytical NETS bene�ts (food and fuel subsidies), with already in place. work, including user surveys to assess fragmented coverage, poor targeting, the impact of SSN interventions on ■ Medium-term: build SSN infrastructure in low capacity, and little or no monitoring bene�ciaries. countries where SSNs are inexistent or of results. highly ineffective, and engage in ■ Promote, through dialogue and technical ■ Any reform of (the currently regressive) consultations for consensus building on assistance, safety net programs that subsidies will invariably hurt the middle the need and design features of SSNs. raise productivity and help create jobs. class and therefore be very dif�cult. ■ Support this process through knowledge sharing, technical/�nancial assistance, and especially dialogue, as it requires comprehensive approaches supported by top political leadership, transparent in their potential effects on all parties, consistent over the long-term and often accompanied by transition supports. 74 RESILIENCE, EQUIT Y, OPPORTUNIT Y MIDDLE EAST AND NORTH AFRICA REGION (MENA) Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ Low coverage, with around 70 percent ■ Provide client countries assistance in (i) ■ Regional dialogue on social insurance SOCIAL of the labor force in MENA not covered shifting to consolidated and long term portability for improved migration INSURANCE by pensions. sustainable pension systems, (ii) management at the Marseille Centre. extending coverage of social security ■ Absence or weaknesses in other social ■ Engage in dialogue and provide client programs, (iii) introducing new social insurance programs (such as countries with �nancial and technical insurance programs, such as unemployment, disability, or assistance to promote integrated social unemployment insurance and maternity survivorship). security reform. bene�ts, (iv) improving the design and ■ Culture of job protection, rather than implementation of less traditional social worker protection. insurance programs such as disability ■ Long term unsustainable schemes that, and survivorship bene�ts; (v) promoting given the low coverage, result in �nancial literacy among disadvantaged regressive income distribution. groups, and (vi) increasing transparency and governance through regulatory frameworks. LABOR ■ MENA has the lowest female ■ Short-term: design and implement ■ Jobs Flagship Regional Study will shed MARKETS participation rate in the world and highest employment response packages to light on key challenges and provide policy unemployment rate among youth. address the youth unemployment crisis options to improve labor market outcomes (skilled and unskilled), including a mixture in the region. ■ The region also suffers from skills of programs and policies for employment mismatch among workers with tertiary ■ Continue AAA work in migration, focusing generation, temporary employment and education. on regional solutions to improve labor income protection. mobility. ■ Large public sectors, rigid labor ■ Medium-term: reform labor regulation, regulations, and high tax wedges ■ Provide technical support in the design/ promote private intermediation, and discourage employment creation in the implementation/ evaluation of activation improve public employment services formal sector. programs and of workfare programs for through investment operations in order to both skilled and unskilled workers. ■ Only 19 percent of the working age assess and monitor ongoing employment population hold a formal sector job programs, reform ALMPs systems, ■ Promote policy dialogue and operations to (2010). develop/design labor market information increase access to information and systems, and open up dialogue on statistics and to increase capacity to ■ A continued high share of youth, and increase productivity in informal sector. conduct impact evaluations to assess continuing (in some cases high) program performance, increase population growth can exacerbate transparency, and promote good problematic labor market outcomes. governance . THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 75 SOUTH ASIA REGION (SAR) Focus area Challenges Objectives Bank SPL practice SPL ■ Existing programs and systems are ■ Strengthen country-owned national SPL ■ Strengthen existing SPL program and SYSTEMS limited in coverage, especially of poor systems. system design, administration and and vulnerable populations, and governance through improving ■ Promote institutional development and the fragmented, and suffer from weak coordination across programs, targeting, move to SPL systems through the use of administrative capacity. �scal sustainability, and M&E. common subsystem ‘building blocks,’ such ■ The region is home to over 1/2 billion as identi�cation campaigns, single ■ Promote the evidence base for SPL poor people, has the worst nutrition bene�ciary registry, uni�ed MIS, and systems reforms: (i) expand safety net indicators among children across all harmonized targeting systems. assessments to SPL assessments; (ii) regions and has the largest number of strengthen poverty assessments to include ■ Foster and build on existing innovation, conflicts, insurgencies and/or civil strife analyses of chronic and transitory poverty including the use ITC innovations to among all regions. and vulnerability to inform SPL improve delivery (for example, cash less programming; (iii) continue to invest in ■ The region vulnerable to natural systems). impact evaluations to inform policy and disasters and climatic shocks. ■ Strengthen governance and accountability program reform and design; (iv) assist ■ Limited �scal space and close to 90 governments in the preparation/ update of ■ Scale up effective SPL programs in percent of the labor force working in the their SPL strategies. coordination with other development informal sector make the sustainable partners. ■ Support climate change and disaster risk �nancing of the SPL systems a ■ Improve emergency crisis response management work led by other units. challenge. mechanisms that can be deployed at short ■ Mobilize partnerships across sectors ■ There is a need to improve donor notice. (SDN, PREM, and HD) and agencies coordination in safety net work in some ■ Expanding coverage of SPL systems to (ADB, WFP, UNICEF, ILO, GIZ, DFID, countries in the region. reach the informal poor. Italy, USAID). ■ Review the sustainability of safety nets by ■ Build on success of innovative pilots and eliminating poorly targeted interventions, influential investments, including the recent eliminating leakages and prioritizing Pakistan CCT Benazir Income Support programs. Program, the Bangladesh Employment Generation Program for the Poorest, and India’s RSBY health and NREGA workfare innovations. SOCIAL ■ Coverage, bene�ts, and quality of ■ Expand coverage, improve targeting. ■ Support building effective safety nets SAFETY targeting vary across the different through development policy credits, ■ Improve capacity to scale-up in the face NETS countries in South Asia. Bangladesh, emergency loans, investment lendings, of crises. India, and Pakistan have moderate and results based �nancing. Regularly capacity in SSNs with one or more ■ Improve M&E geared toward reducing update vulnerability diagnostics. progressively targeted programs to leakages and problems of exclusion. ■ Gradually initiate CCT programs as an build on. The other countries have ■ Strengthen linkages with human add-on to basic UCTs, to increase poor weaker SSN systems, which require development outcomes, including better households’ investments in human substantial improvement in terms of nutrition for women and children, girls’ capital. coverage targeting and M&E. There is education and overall access to services. weak policy coordination across the ■ Continue carrying out innovative impact region and evidence based policies evaluations to document program need to be strengthened. Most effectiveness. countries have a multitude of small programs with overlapping mandates. 76 RESILIENCE, EQUIT Y, OPPORTUNIT Y SOUTH ASIA REGION (SAR) Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ Coverage of old age pensions, disability ■ Provide social protection for older poor ■ Support civil service pension reform. SOCIAL and health insurance is 10 percent or people by introducing noncontributory ■ Move to policies that protect workers INSURANCE less of the population, leaving the huge social pensions in a �scally sustainable not jobs. informal sector to rely on family way. resources or limited SSNs to respond ■ Programs that provide health insurance ■ Use entry points across programs and to crises. for the poor will be piloted and rolled- administrative subsystems to connect out as appropriate. ■ Pensions programs focused on nonpoor programs and schemes (for example, (share of GDP low relative to OECD, from pensions to social insurance; or but implicit pension debt can be very SSNs to social insurance). high). ■ Expanding coverage to the informal sectors by reforming contributory schemes. ■ Address �scal sustainability of civil service pensions. LABOR ■ Job opportunities are limited: formal ■ Improving skills and employability is a ■ Promote market-based skills MARKETS sector jobs only cover 10 percent of the priority, particularly for the informal development for the poor, making labor force. sector; this calls for skills development programs accessible to those who work opportunities linked to private sector in the informal sector. ■ Over 25 percent of the labor force in employment, complementing short term every country (except Sri Lanka) has no ■ Utilize technology to reduce the SSN mechanisms. formal education. mismatches between labor demand and ■ Foster innovative solutions to improving labor supply by increasing the availability ■ Low productivity jobs are predominant productivity, supporting of information. in the labor market. entrepreneurship. ■ Develop activation/ skills programs for ■ More than1 million people will enter the the informal sector. labor market each month over the next two decades, mainly unskilled youth facing uncertain employment prospects. ■ Migration from rural to urban areas. ■ Second-lowest female labor force participation in the world, behind MENA. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 77 ANCHOR* Focus area Challenges Objectives Bank SPL practice SPL ■ Fragmented programs that are not able ■ Develop a better understanding of SPL ■ Develop better knowledge/ global data SYSTEMS to work together effectively. system design and implementation, on SPL regarding: (i) what exists notably how SPL programs can work (inventories of SPL programs ); (ii) how ■ Limited understanding of program together to be more responsive, much it costs (with cost-bene�t/ design and related incentives that affect inclusive, sustainable, and productive. effectiveness analysis); (iii) who gets it people’s choices and behaviour. (targeting, bene�ciary ID analysis); and ■ Develop and share knowledge on SPL ■ Weak M&E across SPL programs. (iv) how it works (including incentives, systems across countries, partner ■ Lack of country and global data/ design). organizations. knowledge on the full set of SPL ■ Facilitate and organize global learning, ■ Support regions in their engagement programs in countries (what exists, especially South-South. with clients on SPL systems policy, costs, bene�ciaries, performance). programs, and administrative tools. ■ Provide direct support to regional teams ■ Sustainability and cost-effectiveness through high-level operational support, ■ Facilitate global operational and across programs. peer review, advisory services, and high analytical partnerships on SPL systems. ■ Ensuring responsiveness to crises and quality analytical products. ■ Catalyze �nancial support for the shocks. ■ Manage staff training on SPL systems. development of SPL systems, especially ■ Strengthening transparency and in IDA countries. ■ Mobilize international �nancial support accountability. for SPL systems development, notably ■ Expand the evaluation agenda to a through the RSR initiative. systems-focus. SOCIAL ■ Coverage remains low especially in LICs ■ Support regions in the design and ■ Develop data to inform crisis SAFETY and fragile states. implementation of policies and programs responsiveness, coordinated with NETS to test ideas and programs and poverty data and impact evaluation work. ■ Fragmentation across poorly formulate �scally sustainable SSN coordinated, temporary and not well ■ Inform expanded World Bank SSN focus strategies. targeted programs. from MICs to include a tailored focus on ■ Develop and share knowledge on: (i) LICs-fragile contexts. ■ Crisis responsiveness often missing as expanding coverage and reducing many SSNs are focused on reducing ■ Support knowledge on how to develop fragmentation through more coherent chronic poverty. administrative “building blocks�, SSN approaches; (ii) strengthening harmonized and coordinated across ■ Affordability, notably in LICs where affordability by building sound basic SPL. needs are greatest and competition with administrative systems; (iii) focusing on other expenditures most acute, calling good governance; (iv) including cost- ■ Strengthen the results approaches in on better cost data and impact evidence. bene�t/effectiveness and evidence in SSNs: cost-bene�t, cost-effectiveness analytical work. analysis in impact evaluations (including ■ Leveraging knowledge across the global across design options); benchmarking of South, the source of much SSN ■ Focus on the productive role of safety SSN programs; and modeling. innovation and interest. nets for advocacy and greater impact, both in analytical work and design. ■ Continue capacity building through South-South learning and core training, ■ Promote South-South learning, incorporating crisis resilience, systems. especially to share innovations. * The anchor’s work program also includes a focus on disability and on results. 78 RESILIENCE, EQUIT Y, OPPORTUNIT Y ANCHOR* Focus area Challenges Objectives Bank SPL practice PENSIONS/ ■ Aging populations. Ratio of pensioners ■ Support regions in the design and ■ Improve PROST and other models, SOCIAL to workers rising, dramatically in some implementation of policies and programs tools, databases and benchmarks to INSURANCE regions (ECA, EAP). to manage the challenge of developing measure pension performance. �scally sustainable pensions for their ■ Low coverage. Less than a third of the ■ Knowledge development, training and aging populations. world’s working age population is sharing, especially in the areas of core covered by contributory pension ■ Develop and share knowledge on: (i) challenges—coverage, adequacy and provisions (1/10 in LICs). expanding coverage through innovative sustainability. programs for the informal sector and ■ Adequacy. In LICs, periods outside of ■ Further development of core indicators social pensions; (ii) ensuring the formal labor force reduce pensions while and M&E methods to measure adequacy of contributory and non- low bene�t levels in social pensions can performance. contributory bene�ts together; (iii) prove inadequate. ensuring sustainability and resilience to ■ Sustainability. A key challenge will be to shocks. support parametric and structural reform ■ Strengthen administrative ef�ciency/ measures which can improve capacity, including MISs and long run sustainability while ensuring adequacy. �nancial projections. ■ Low administrative ef�ciency/capacity. ■ Build capacity within the World Bank and at the country level on the design, implementation, and evaluation of pension policies and programs. LABOR ■ Knowledge gaps regarding the best ■ Support regions in the design and ■ Develop a Jobs Knowledge Platform to MARKETS ways to create jobs and improve implementation of policies and programs mobilize the global community of AND YOUTH workers’ labor market opportunities. to improve labor market outcomes. practice. ■ Low employment/ productivity levels ■ Develop and share knowledge in three ■ Move to a second generation of impact driven by low female participation rates; areas: (1) promoting the creation of evaluations focused on cost-bene�t/ a high share of the labor force working in good jobs—wage or self employment; (2) effectiveness and design options. agriculture, low productivity self- facilitating labor market transitions and ■ Develop a data warehouse to monitor employment, or informal wage managing risks; and (3) building skills. labor market outcomes and understand employment; high unemployment rates ■ Build capacity within the World Bank their determinants. among youth; a high share of unskilled and at the country level on the design, workers or skilled workers who do not ■ Improve modelling tools to support labor implementation, and evaluation of labor have relevant skills; and large migration policy analysis. policies and programs. flows. ■ Develop partnerships to mobilize human ■ Limited labor data and research in and �nancial resources to support data developing countries, particularly LICs. collection at the country level, analytical and policy work, and impact evaluations. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 79 Annex 2: Background Papers to the Social Protection and Labor Strategy 2012–22 Nine papers were developed as inputs to the strategy, about instruments, �nancing mechanisms, and institu- providing background on the main areas of practice tional arrangements. The last part of the paper outlines and themes facing the World Bank’s social protection the operational implications of a systems vision for and labor practice in the decade ahead. Together with social protection. the IEG report on social safety nets, these back- ground papers provided critical inputs to the stategy’s development and will be important to guiding its PRODUCTIVE ROLE OF SAFETY NETS application. Harold Alderman and Ruslan Yemtsov. 2012. The full papers can be found at http://www.world- The paper contains a short theoretical framework for bank.org/spstrategy linking SPL with growth and productivity, an updated review of the literature, new original work �lling in gaps in the available evidence, and a discussion of BUILDING SOCIAL PROTECTION AND LABOR operational implications. The paper demonstrates that SYSTEMS: CONCEPTS AND OPERATIONAL there was a shift in economists’ view on social protec- IMPLICATIONS tion: it is no longer regarded as a drag on resources David A. Robalino, Laura Rawlings, or a distortion, but recognized as a force that can and Ian Walker. 2012. make a positive contribution towards economic growth and reduce poverty. The paper looks at path- The paper presents a framework for designing and ways through which SPL programs (social insurance implementing SPL systems in MICs and LICs. The and social assistance programs, as well as labor pro- main motivation is that although the term “system� is grams) can support better growth outcomes: (i) at the used to describe the set of social protection arrange- individual level (building and protecting human capital, ments that countries implement, the reality is more an and other productive assets, empowering poor indi- amalgam of programs operating with little or no coordi- viduals to invest or to adopt higher risk, higher return nation. The paper shows that reducing fragmentation strategies), (ii) at the local economy level (enhancing and coordinating and harmonizing programs have the community assets and infrastructure, positive spill- potential to enhance programs’ performance, as well as overs from bene�ciaries to nonbene�ciaries, greater the overall provision of social protection. The �rst part labor market mobility), (iii) at the overall economy level of the paper discusses the characteristics of well- (acting as stabilizers of aggregate demand, improving designed SPL systems and the gains that can be social cohesion and making growth-enhancing achieved in terms of the following: (i) more effective risk reforms more politically feasible). Most SPL programs management in crisis and noncrisis periods; (ii) affect growth through all of these pathways. The improved �nancial sustainability; (iii) more equitable paper concludes with a discussion of how to design redistribution; (iv) economies of scale in administration and implement SPL programs to maximize their and IT systems; and (v) better incentives. The second growth enhancing effects, while minimizing the disin- part discusses issues related to design and implemen- centives that may reduce effort or ef�ciency. The tation based on country studies for Brazil, Chile, India, paper is a joint effort between the HD Anchor, GET, Niger, and Vietnam. It suggests three levels of engage- PREM Anchor, regional SPL family members, and ment: (i) de�ning a long-term vision for the SPL system ARD in partnership with DFID and FAO. and ensuring policy coherence; (ii) integrating and coordinating programs; and (iii) setting up basic admin- istrative tools. This includes a discussion of choices 80 RESILIENCE, EQUIT Y, OPPORTUNIT Y IMPROVING ACCESS TO JOBS AND EARNINGS effectively protecting populations, especially in the OPPORTUNITIES: THE ROLE OF ACTIVATION case of LICs and fragile states. A key conclusion of AND GRADUATION POLICIES this review is that countries need scalable systems in Rita Almeida, Juliana Arbelaez, Maddalena place before crises arise to be able to respond effec- Honorati, Arvo Kuddo, Tanja Lohmann, Mirey tively. The World Bank can assist countries with crisis Ovadiya, Lucian Pop, Maria Laura Sanchez Puerta, management in four ways: adapting ongoing, estab- and Michael Weber. 2012. lished programs to respond to crises; developing programs that can be implemented during crises; Throughout the developing world there is a growing supplying countercyclical �nancing; and sharing demand for advice on the design of policies to most know-how and toolkits. vulnerable individuals’ access to more and better jobs, while reducing their dependency from public income support. Even though these policies are common to RULES, ROLES AND CONTROLS: GOVERNANCE both the activation and graduation agendas, a separa- IN SOCIAL PROTECTION WITH AN APPLICATION tion is needed as the graduation of bene�ciaries out of TO SOCIAL ASSISTANCE poverty is a much more ambitious agenda. This paper Lucy Bassett, Sara Giannozzi, Lucian Pop, and proposes a simple policy framework highlighting the Dena Ringold. 2012. most common barriers to productive employment. It also reviews the incentive compatibility between The paper develops an operational de�nition of gover- income support and employment support programs. nance that can be applied to social protection. The The paper �nds that, especially in MICs, activation and paper uses the 2004 WDR accountability framework ALMPs play an important role connecting individuals to as a starting point, de�ning accountability in terms of jobs and improving earnings opportunities. In LICs, a set of principal-agent relationships between policy these programs are far from being a panacea to gradu- makers, providers, and citizens. Applying this frame- ate bene�ciaries out of poverty. Furthermore, only scant work to social protection, the paper looks at three evidence is available on the pathways to graduation broad areas where the Bank is involved in governance and signi�cant knowledge gaps remain. More cross- in social protection: rules of the game, including clear disciplinary research is needed to strengthen the criteria for entry and exit of programs; roles and evidence base and develop recommendations for dif- responsibilities, including de�ning accountability rela- ferent contexts and capacity levels. tionships and incentive frameworks across levels of government and institutions involved in social protec- tion; and controls and accountability measures, CRISIS RESPONSE IN SOCIAL PROTECTION including the broad set of implementation mecha- Federica Marzo and Hideki Mori. 2012. nisms and procedures for ensuring that “the right bene�t gets to the right person at the right time.� The Globalization, demographic trends, urbanization, paper applies this framework to social assistance migration, and climate change compound each other policies and programs, reviews what is currently being in increasing the frequency of crises. This will require done across the Bank in this area, and identi�es governments to have better, faster, and stronger future opportunities for clients and Bank engagement. social protection responses, and the World Bank must be well prepared to provide support. To this end, this paper reviews selected crises (1990–present), LABOR MARKETS IN MIDDLE AND LOW INCOME their social impact and government responses to COUNTRIES: TRENDS AND IMPLICATIONS FOR evaluate the performance of social protection instru- SOCIAL PROTECTION AND LABOR POLICIES ments deployed, developing lessons for the future. Yoonyoung Cho, David Margolis, David Newhouse, While experience suggests that governments and the and David Robalino. 2012. World Bank are increasingly committed to main- streaming social protection in crisis prevention and The paper reviews labor market trends over the last management, important challenges still remain in two decades in over 133 MICs and LICs, identi�es THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 81 speci�c problems and policy priorities across groups diverse as Ethiopia, India, Pakistan, and Rwanda have of countries, and derives implications for the Bank’s shown how social protection interventions can be work on labor for the SPL Strategy. The paper shows adapted to the LIC context. Yet despite growing levels that over the last two decades the main problem fac- of support for these initiatives, many challenges remain. ing developing countries has not been the quantity of In LICs and fragile states, governments are confronted jobs but their quality. It argues that while having poli- with a nexus of mutually reinforcing de�cits that cies in place that improve the ef�ciency of businesses increase the need for social protection programs and and job creation (and destruction), it is also critical to simultaneously reduce the ability of the governments to devise interventions that improve the quality of the successfully respond. Governments face hard choices jobs and occupations that already exist—in part about the type, affordability, and sustainability of social through interventions targeted to the self-employed protection interventions. The paper reviews how these and small entrepreneurs. factors affect social protection programs in these coun- tries and identi�es ways to address these de�cits. It supports the establishment of resilient social protection THE WORLD BANK IN PENSIONS: A systems to address speci�c needs and vulnerabilities BACKGROUND PAPER FOR THE SOCIAL and to respond flexibly to both slow and sudden onset PROTECTION STRATEGY crises. To achieve this, both innovation and pragmatism Mark Dorfman and Robert Palacios. 2012. are required in three strategic areas: (i) building the basic blocks of social protection systems (such as Pensions and social insurance programs that prevent targeting, payments, and M&E); (ii) ensuring �nancial a substantial loss in consumption resulting from old sustainability; and (iii) promoting good governance and age, disability, or death are an integral part of any transparency. These issues suggest the possibility of a social protection system. In addition, social insurance different trajectory in the development of social protec- programs often insure against unemployment, work tion in LICs than in MICs. The implications for World injury, and illness. The dual objectives of such pro- Bank support include the need to focus on increasing grams are to allow for the prevention of a sharp knowledge on and operational effectiveness of social decline in income when these life-cycle events take protection programs, fostering institutional links place and protection against poverty in old age. This between multiple social protection programs, and using background paper reviews the World Bank’s concep- community capacity and technological innovations to tual framework for the analysis of pension programs, overcome bottlenecks in operations. de�nes the major challenges facing low and middle income countries, and proposes a broad, forward- looking strategy to help address these challenges. CLIMATE-RESPONSIVE SOCIAL PROTECTION Anne T. Kuriakose, Rasmus Heltberg, William Wiseman, Cecilia Costella, Rachel Cipryk, and SOCIAL PROTECTION IN LOW INCOME Sabine Cornelius. 2012. COUNTRIES AND FRAGILE SITUATIONS: CHALLENGES AND FUTURE DIRECTIONS Increases in temperature and greater variability in Colin Andrews, Maitreyi Das, John Elder, Mirey rainfall are already being recorded in various regions, Ovadiya, and Giuseppe Zampaglione. 2012. leading to more frequent and severe extreme weather events, rising sea levels, and related hazards of flood- Demand for social protection is growing in LICs and ing, drought, and vector-borne disease. Climate fragile situations. In recent years, the success of social change and natural disasters will shape our world in protection interventions in middle-income countries the decades to come, making incomes, livelihoods, (MICs), such as Brazil and Mexico, along with the and food prices more volatile. These impacts dispro- series of food, fuel, and �nancial crises, has prompted portionately affect the poor as they have less capacity policy makers in LICs and fragile situations to examine for response and adaptation. They consequently are the possibility of introducing such programs in their at increased risk of losing life and assets in natural own countries. Flagship programs in countries as disasters and climatic shocks and of having to rely on 82 RESILIENCE, EQUIT Y, OPPORTUNIT Y adverse coping mechanisms with long-term negative implications for human development. It is critical to identify and implement investments to help the most vulnerable populations to become resilient to these shocks. SPL mechanisms are increasingly being called upon to help communities affected by natural disasters, whether these are climate-related or not. Moreover, it is increasingly recognized that social protection can play an important role in building adap- tive capacity at both the local and national levels. Such investments include not only consumption- smoothing safety nets but also investments in land and water management, small-scale infrastructure, and education and training to enable local people to diversify their livelihoods. By integrating climate and disaster risk considerations into their planning and design, SPL programs can help prevent poor and vulnerable households from falling deeper into pov- erty, reduce their overall risk exposure, and contribute to long-term adaptation to climate change. The objec- tive of this paper is to assess the linkages between social protection and climate change and identify speci�c steps that can strengthen the climate respon- siveness of SPL programs and systems. For this, the paper proposes a framework for climate-responsive social protection (CRSP) and identi�es key principles for design and implementation, drawing on examples from Ethiopia and Mongolia. In making the case for CRSP, this paper argues that taking climate change into account when planning and designing SPL pro- grams will contribute to resilience and adaptation for SPL target groups via a broad range of preventive, protective, and promotional functions. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 83 Annex 3: World Bank Social Protection And Labor Portfolio A. Lending Table 1 New World Bank Commitments to SPL, 1998-2011 ($ million) SP&L LENDING ($ MILLIONS) practice area FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 Social funds 111 442 199 352 506 275 187 324 - 108 61 342 117 Safety nets 551 243 345 318 211 1,069 321 553 509 444 273 3,133 2,517 3,506 Other SPL & 184 327 17 276 80 167 101 113 166 115 26 71 462 228 risk management Social risk 790 480 450 116 130 275 323 322 233 137 100 148 36 46 mitigation Labor markets 796 1,033 596 448 349 360 271 439 318 405 227 720 921 262 Total 2,431 2,525 1,608 1,510 1,276 2,147 1,203 1,752 1,226 1,209 686 4,414 4,053 4,042 Source: Business warehouse and staff calculations for social funds. Figure 1 Figure 2 IBRD vs. ID—Annual SPL Lending IBRD vs. IDA—Annual SPL Disbursements 4,000 4,000 3,500 3,500 3,000 3,000 US$ million US$ million 2,500 2,500 2,000 2,000 1,500 1,500 1,000 1,000 500 500 - 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 IBRD IDA IBRD IDA 84 RESILIENCE, EQUIT Y, OPPORTUNIT Y Table 2 Geographic Coverage of SPL Lending NUMBER OF COUNTRIES AS PERCENT OF TOTAL REGION Prior to 1998 As of 2011 Prior to 1998 As of 2010 Africa 29 42 33 33 East Asia and the Paci�c 5 14 6 11 South Asia 5 8 6 6 Europe and Central Asia 20 25 23 20 Middle East and North Africa 6 11 7 9 Latin America and the Caribbean 23 26 26 21 Total 88 126 100 100 Figure 3 Top Ten SPL Borrowers, FY1998-2011 ($, millions) Indonesia Ethiopia Pakistan Poland Romania Colombia Turkey Brazil Argentina Mexico 0 500 1,000 1,500 2,000 2,500 3,000 3,500 THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 85 Figure 4 Aggregate Number of SPL Projects by Region, FY1998-2011 120 100 80 60 40 20 0 Africa East Asia and the South Asia Europe and Central Middle East and Latin America and Pacific Asia North Africa the Carribean Social funds Social risk Other social Safety nets Labor markets mitigation protect Figure 5 Percentage of Approved SPL Projects by Lending Instrument, FY1998-2011 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 Investment Development policy 86 RESILIENCE, EQUIT Y, OPPORTUNIT Y B. Portfolio Performance Table 3 Portfolio Indices for Selected Years (Percent) PORTFOLIO FY98 FY00 FY02 FY04 FY06 FY08 FY10 FY11 AVERAGE INDICES Disbursement ratio 41 34 22 35 39 46 67 42 44 Bank average 19 19 19 20 22 21 26 21 21 Projects at risk 14 15 21 14 18 23 24 22 17 Bank average 25 15 19 16 14 17 21 19 18 Commitment at risk 3 5 27 19 11 22 12 9 13 Bank average 21 16 17 16 12 17 18 14 16 Proactivity 91 83 71 100 50 91 78 71 80 Bank average 72 84 84 83 81 81 70 61 78 Unsatisfactory projects 9 14 10 12 16 9 15 8 11 Bank average 17 12 11 13 11 11 13 12 12 Disbursement lag 25 34 33 27 15 14 -47 -7.2 15 Bank average 36 40 40 36 33 25 15 19 32 THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 87 Annex 4. Results of the SPL Strategy Consultations Consultations Process Channels for Consultation The development of the SPL strategy was supported ■ Face-to-face meetings at the country and regional by a global multistakeholder consultation process that level, complemented by video conferencing sought to elicit views and inputs in as broad, inclusive, ■ Face-to-face meetings alongside global and and transparent a manner as possible on challenges regional conferences and opportunities for SPL policies and programs in ■ Online feedback through an online survey, web- the next decade, as well as creating a space for based discussion forum and email platform dialogue and expanding channels for ongoing ■ An external Social Protection Advisory Group stakeholder engagement. composed of top academics, policy makers, civil society, and others The consultations process entailed two different phases that allowed stakeholders and interested parties to provide feedback throughout the strategy Stakeholders Consulted development process. During Phase I (January – May 2011), the World Bank sought inputs to the strategy Stakeholders consulted during this process based on a concept note that described the approach comprised a broad range of actors involved in SPL, towards a new strategy and proposed a framework amounting to over 2,000 individuals from government, focused on building resilience and opportunity development agencies, CSOs, trade unions, the through protection, prevention, and promotion as core private sector, academia, think tanks, and others. SPL functions and an emphasis on building SPL ■ Face to face events: A total of 64 face-to-face systems. During Phase II of consultations (October and videoconference consultation events and 2011- January 2012), the World Bank sought roundtables were held to discuss the SPL feedback on the strategy itself (based on a slide strategy, involving over 1,700 participants from presentation highlighting key concepts from the draft governments, CSOs, academics, the private strategy) that helped �nalize the draft version of the sector, and both bilateral and multilateral strategy submitted to CODE for review in early 2012. development agencies, representing 66 During this process, a website has supported the countries in all regions. Seven consultation development of the SPL strategy and contains all events were held in the context of ongoing relevant documents (www.worldbank.org/spstrategy) global and regional events. Consultations Timeline JANUARY – JUNE JULY – OCTOBER 2011– FEBRUARY – APRIL MAY 2011 2011 SEPTEMBER JANUARY 2012 MARCH 2012 2012 2011 Phase 1 Consultations: Review of Preparation of Phase 2 Consultations: Review of draft Launch of Strategy at Online and face-to-face stakeholder input Strategy Presentation online and face-to-face Strategy Paper World Bank Spring discussions to gather discussion to gather Meetings input on Concept Note further inputs 88 RESILIENCE, EQUIT Y, OPPORTUNIT Y ■ Online consultations: The Bank set up a website markets; (iii) rapid urbanization trends, but also (iv) that included a web-based survey, an on-line changes in rural and agricultural contexts, and (v) discussion forum, and a dedicated email contact migration. point. Over 150 people responded to the online ■ The need for coordination given the multiplicity of survey, providing essential feedback on the main stakeholders and actors involved in SPL, and areas of focus for the new strategy as well as on fragmentation among numerous programs. the challenges for SPL in the coming 10 years. A ■ Financing and sustainability of SPL given Discussion Forum featured blogs on subjects pressures on limited �scal space. germane to the SPL Strategy, including social ■ Coverage and social inclusion, notably with protection systems, crises, disability, rights and respect to (i) informality and the challenges of accountability, jobs, and the role of social extending SPL coverage, and (ii) vulnerable protection in LICs. The forum totaled 204 groups, including children and youth, women, participants that provided comments to the people with disabilities, and those impacted by discussion topics. Finally, comments from around climate change and economic crises, including 25 institutions and individuals were received to the food price volatility. strategy email contact point from research ■ Effective SPL approaches are needed both in institutions, development agencies, CSOs, and the stable times to address poverty and vulnerability private sector. and during crises to respond to shocks, with a ■ Advisory Group: The World Bank also convened strong focus on �scal sustainability. an external SPL Advisory Group to marshal advice ■ The productive role of SPL and the importance of and insights from top academics, policy makers, social protection for economic growth need to be and civil society representatives from client a key message of the strategy. countries. Two workshops were held with the ■ A focus on the role of political economy for advisors in April and September 2011.1 introducing, implementing, and measuring impacts of SPL interventions is needed. ■ Communities, civil society, and the private sector Findings have an important role as providers of SPL functions, as well as agents for transparency and This section presents a summary of the input collected accountability. during the consultations around four general topics: (i) challenges and issues in SPL in the next decade; (ii) the B. ROLE OF THE WORLD BANK FOR SPL role of the Bank in SPL; (iii) feedback on the strategy ■ Generate and share evidence on the role of social framework and focus areas; and, (iv) important elements protection, especially with respect to growth and and challenges for the main SPL practice areas. results, highlighting good practice and innovations. ■ Support coordination across donors, government A. CHALLENGES AND ISSUES IN SPL IN THE agencies, and other actors engaged in social NEXT DECADE protection. ■ Demographic trends, including the following: (i) ■ Financing for social protection, both directly and the youth bulge and the corresponding pressure by mobilizing others’ support. for jobs and productivity; (ii) aging populations ■ Capacity building for effective SPL programs and with attendant implications for pensions & labor systems. 1 Advisory Group members include: Jose Manuel Salazar-Xirinachs, Executive Director of the ILO Employment Sector and former Minister of Foreign Trade, Costa Rica; Romulo Paes de Sousa, Deputy Minister of Social Development, Brazil; James Dorbor Jallah, Deputy Minister for Sectoral and Regional Planning, Liberia (March-July 2011); Samura Kamara, Minister of Finance and Development, Sierra Leone (from July, 2011); Victoria Garchitorena, President of the Ayala Foundation, Philippines; Cai Fang, Director of the Institute of Population and Labor Economics at the Chinese Academy of Social Sciences, China; Fatima M. Al-Balooshi, Minister of Social Development, Bahrain; Ravi Kanbur, T. H. Lee Professor of World Affairs, International Professor of Applied Economics and Management, and Professor of Economics, Cornell University; and Evgeny Gontmaher, Former Minister of Labor, Russia, now Director for Social-Economic Development at the Institute of Contemporary Development (INSOR), and Head of the Center for Social Policy Studies at the Institute of Economics of the Russian Academy of Sciences. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 89 C. FEEDBACK ON THE STRATEGY FRAMEWORK D. IMPORTANT ELEMENTS AND CHALLENGES AND FOCUS AREAS FOR THE MAIN SPL PRACTICE AREAS ■ The 3P Framework, which highlights the role of ■ Focus on the balance between the supply and SPL in providing prevention, protection, and demand sides of labor markets, as some factors promotion functions was welcomed, in particular, that constrain labor creation lie outside the labor the newer focus on promotion. markets area and SPL’s primary focus is on labor ■ Broad consensus regarding the need to focus on supply issues, recognizing that cross-sectoral SPL systems, with a particular eye toward (i) interventions are key. coordinating across programs serving similar ■ Productivity and the returns to labor should be functions; (ii) using complementary programs to emphasized in the SPL strategy. Increasing the foster graduation from social assistance and productivity of work in formal, as well as in informal access to jobs; (iii) having a multisectoral and rural areas, implies an increased ability of poor perspective; (iv) aligning resources and promoting people to use labor as a risk management �scal sustainability; (v) ensuring a strong instrument. institutional and legal foundation; and (vi) tailoring ■ The linkages between labor and safety nets are systems to country contexts. key, in particular with regards to the development ■ Support for expanding coverage, especially in of human capital, and promoting the transition from LICs and fragile states, with some caveats: (i) the social assistance into the labor market. focus on fragile contexts and LICs should not imply ■ Increased coverage of safety net interventions, less attention to MICs; especially vulnerable especially in LICs and fragile states, is crucial, populations in MICs, (ii) there is a need to given the increasing incidence of economic differentiate between fragile states and LICs; and shocks, weather-related disasters, and political (iii) the World Bank should maintain a country-led instabilities, and their impact on the vulnerable process responsive to client demands. populations. ■ Consensus on promoting links to human capital, ■ Greater attention to the life-cycle approach and skills, and labor market insertion. Links between the role of categorical transfers to build resilience poverty reduction and productivity should be and opportunity. emphasized. Promising areas of engagement ■ Sustainable �nancing for safety net is key and include the following: education and skills requires a continued investment in advocacy and development, ALMPs, entrepreneurship highlighting the positivite linkages between safety development, livelihoods programs (especially in nets, poverty reduction, and human capital rural areas), and micro�nance. However, not all development. people will be able to graduate from social ■ In LICs, social pensions are able to effectively assistance or enter the labor market, underscoring address income security for the elderly. Options for the continued need to protect the most vulnerable. reaching the elderly in a more inclusive way need ■ Unanimous call for emphasizing knowledge and to be explored in these contexts, when resources results given the serious gaps in this area and are constrained; the World Bank’s recognized role in generating ■ Insurance and pension schemes generally bene�t evidence on program performance and a small segment of employees in the formal sector. supporting learning across countries. The World It is thus vital to extend the coverage to the Bank should focus on both in-depth and cross- informal sector (including youth), while keeping in country analysis to learn from and leverage mind capacity and resources constraints. innovations and knowledge, including an understanding of contexts and lessons on The following section presents some conclusions and successes and failures. implications of these �ndings for the World Bank’s work on SPL. A report on the consultations provides further, disaggregated details on the main issues discussed by stakeholders by themes, country context, region, and type of stakeholder. 90 RESILIENCE, EQUIT Y, OPPORTUNIT Y Implications for the SPL Strategy While much of the feedback received during the consultations contributed to drafting the strategy paper, the results from this process will also provide a stronger sense of direction to SPL practice in the decade to come. Some of the conclusions and implications that can be extracted for the strategy and its implementation in the next 10 years are as follows: ■ Strong endorsement of the main areas proposed by the SPL Strategy concept note, particularly a focus on the need for building SPL systems. ■ Broad support to the Bank’s role for generating knowledge and serving as a channel for knowledge exchange;. ■ A strong call for expanding the coverage of SPL in LICs and fragile states, as well as MICs. ■ A call for the Bank to support coordination and play a convener role with other development actors for policy dialogue around SPL issues. ■ A strong call to keep in mind the essential role of SPL for risk management and addressing vulnerabilities, which are at the core of the practice’s prevention and protection functions. ■ A need to tailor SPL systems and programs to country contexts and a role for the Bank in providing options and tools for client countries anchored in best practice and evidence. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 91 Annex 5: Multisectoral Approaches: Linkages between The SPL Strategy 2012–22 and Other World Bank Group Strategies SECTOR (in alphabetical order) STRATEGIC PRIORITIES LINKAGES TO SPL STRATEGY 2012-22 AGRICULTURE ACTION 1. Raise agricultural productivity ■ SPL has role in strengthening rural livelihoods and PLAN 2010–20 promoting food security by enabling the rural poor to 2. Link farmers to markets and strengthen value chains smooth consumption, particularly during slack agricultural 3. Reduce risk and vulnerability seasons when prices are volatile and demand for labor 4. Facilitate agricultural entry and exit and raise rural nonfarm decreases; and, preventing them from having to deplete incomes their productive assets in order to survive. 5. Enhance environmental services and sustainability ■ SPL can improve livelihoods by enabling the rural poor to accumulate productive assets over time and giving them more and better human capital and livelihood options. ■ Improved agricultural practices provide opportunities for increased productivity and long term resilience. CLIMATE CHANGE 1. Support country-led climate action ■ SPL is relevant to protect the poor and vulnerable after (STRATEGIC climate shocks (through cash transfers, public works, or 2. Mobilize additional concessional and innovative, market- FRAMEWORK) others). based �nance ■ SPL has a role in enhancing adaptive capacity by 3. Leverage private sector resources reducing vulnerability ex-ante (through social and 4. Accelerate development and deployment of new weather-based insurance, transfers, livelihoods technologies diversi�cation, and others) and by encouraging risk 5. Step up policy research, knowledge, and capacity building diversi�cation, enhancing incomes and assets and building skills. EDUCATION STRATEGY 1. Strengthen education systems ■ SPL contributes to access to education by providing 2020 income support to poor households and incentives to 2. Building a high-quality knowledge base to underpin send children to school (for example through conditional education reforms transfers, school feeding programs). ■ SPL encourages skill development through active labor markets programs. ■ Increased quality of education contributes to SPL by supporting human capital development and increased skills for labor markets development. ■ SPL protects human capital during crises. ENERGY STRATEGY 1. Improve the operational and �nancial performance of the ■ Energy contributes to SPL by supporting economic APPROACH PAPER energy sector development and poverty reduction, fueling commerce, agriculture, and important social services. 2. Strengthen governance ■ Adequate and reliable electricity supply increases enterprise productivity, competitiveness, and growth; increasing opportunities for employment and skills development. ■ SPL increases incomes and improves livelihoods of households, thus helping to decrease reliance on harmful use of solid fuels for cooking and heating. 92 RESILIENCE, EQUIT Y, OPPORTUNIT Y SECTOR (in alphabetical order) STRATEGIC PRIORITIES LINKAGES TO SPL STRATEGY 2012-22 ENVIRONMENT 1. Improve the quality of life ■ SPL contributes by promoting assets to restore STRATEGY 2001 environmental degradation, reforestation, and so on 2. Improve the quality of growth (NEW STRATEGY STILL (through public works programs). IN PROGRESS) 3. Protect the quality of the regional and global commons ■ SPL provides support for alternative livelihoods in the face of exploited natural resources. ■ SPL protects agains the effects of natural resource degradation on poor people’s health. GENDER EQUALITY AS Goal: Advance women’s economic empowerment by ■ SPL supports a gender perspective by empoweing SMART ECONOMICS: A enhancing women’s ability to participate in land, labor, women through increased control of resources (transfers), WORLD BANK GROUP �nancial, and product markets gender-appropriate opportunities for employment in GENDER ACTION PLAN workfare programes, skills development, and so on. 1. Engender operations and technical assistance in economic (FISCAL YEARS sectors ■ A gender approach to the design of SPL can improve 2007–10) program effectiveness, strengthening the protection 2. Implement results-based initiatives (RBIs) afforded to families. 3. Improve research and statistics ■ Taking gender into account in the design of old-age 4. Undertake a targeted communications campaign income security ensures that both women and men are well protected, both because women live longer on average and, they are more likely to work in the informal sector. GOVERNANCE AND 1. Recognize that a capable and accountable state creates ■ SPL addresses exclusion through empowering vulnerable ANTI-CORRUPTION opportunities for the poor people, promoting community-driven development and STRATEGY 2007 supporting skills development and greater labor market 2. Support country-driven governance and anticorruption participation. policies and implementation ■ Governance is central to improving service delivery and 3. Support even poorly governed countries enhancing accountability relationships among citizens, 4. Engage with a broad array of stakeholders policy makers, and service providers. 5. Harmonize and coordinate approach with governments, ■ Appropriate ‘rules, roles and controls’ is a focus of SPL donors, and other actors at country and global levels program and system approaches, including attention to enhanced accountability mechanisms and reducing error, fraud and corruption. HEALTH, NUTRITION, 1. Improve level and distribution of HNP outcomes (for ■ SPL faciliates access for vulnerable and marginalized AND POPULATION (HNP) example, MDGs), outputs, and system performance children to the necessary services for physical growth and RESULTS 2007 well being; cognitive development; and socio-emotional 2. Prevent poverty because of illness (by improving �nancial development. protection) ■ SPL helps strengthen health and nutrition access and 3. Improve �nancial sustainability of sector and its outcomes for vulnerable groups, particularly children and contribution to macroeconomic and �scal policy and country pregnant mothers and during crises. competitiveness ■ Multisectoral early childhood development policies serve 4. Improve governance, accountability, and transparency of prevention, protection, and promotion by providing the sector adequate nutrition to children, which reduces future physical vulnerability (prevention), ensuring basic service delivery to those children and pregnant women who most need it (protection), as well as to generate a better family environment conducive to healthy child development and increasing children learning capacities (promotion). THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 93 SECTOR (in alphabetical order) STRATEGIC PRIORITIES LINKAGES TO SPL STRATEGY 2012-22 INFORMATION AND 1. Connect: expand affordable access to ICTs ■ ICT supports SPL programs and systems in service COMMUNICATIONS delivery, from handling a large volume of transactions and 2. Innovate: across the economy and promote the growth of TECHNOLOGY (ICT) data to helping ensure payments and other administrative IT-based service industries 2011 processes. 3. Transform: support ICT applications to transform ef�ciency ■ ICT supports accountability in SPL by allowing for greater and accountability of services transparency and informed communication between citizens and service providers. ■ ICT is used to to control error, fraud, and corruption. ■ ICT helps expand access to SPL through bene�ciary registries, mobile payment systems and access to information. INFRASTRUCTURE 1. Respond to country demand ■ Service delivery infrastructure plays a critical role both for ACTION PLAN 2003 supporting economic growth as well as improving SPL 2. Rebuild sector knowledge bases service delivery. 3. Maximize leverage via new and existing instruments ■ Infrastructure services can increase the general welfare of poor households through reductions in the opportunity costs to meet essential needs. ■ SPL supports the development of social and economic infrastructure through workfare programs and social funds. PRIVATE SECTOR 1. Extend the reach of markets: sound investment climate for ■ PSD contributes to extend the reach of markets, DEVELOPMENT (PSD) poor areas to create jobs and entrepreneurial opportunity promoting a sound investment climate for poor areas to 2002 create jobs and entrepreneurial opportunity. 2. Basic service delivery: where it makes sense, new entry of private providers, including small- or medium-scale local ■ PSD supports basic service delivery by promoting, where entrepreneurs it makes sense, new entry of private providers, including small- or medium-scale local entrepreneurs. 3. PSD and environmental sustainability ■ SPL increases consumption capacity of poor households incentivizing the local economy and the development of small business. SCIENCE, 1. Form partnerships ■ STI contributes to developing a suite of skills and TECHNOLOGY, AND technical capabilities in developing countries including, 2. Carry out inclusive innovation assessments and projects INNOVATION (STI) among others, training policy makers, developing local ACTION PLAN 2009 3. Organize workshops and forums for promotion and institutions, and helping local enterprises become more dissemination innovative, all of which have relevance in the implemtation 4. Provide policy advice and capacity building of SPL programs. 5. Provide information on what other STI actors are doing ■ SPL helps families invest in their human capital, and contributes to skills development and deepening labor markets. SOCIAL DEVELOPMENT 1. Improve macro-level analysis that incorporates social ■ SPL promotes social development by promoting (SD) STRATEGY 2005 development into poverty reduction and/or development individual and community empowerment through social strategies funds, transfers, and other interventions. 2. Promote ef�cient mainstreaming of social development into ■ Social development improves understanding of context projects and variables for SPL implementation by promoting macro-level social analysis. 3. Improve research, capacity building, and partnerships 94 RESILIENCE, EQUIT Y, OPPORTUNIT Y SECTOR (in alphabetical order) STRATEGIC PRIORITIES LINKAGES TO SPL STRATEGY 2012-22 TRANSPORT BUSINESS 1. Create conditions to increase support for transport ■ Transport contributes to creating economic opportunity STRATEGY 2008–12 investment and growth in rural areas by increasing poor people’s access to markets and servcies and reducing the risks of 2. Deepen engagement in the roads and highways and urban travelling. subsectors ■ Better access to education and health facilities increases 3. Diversify engagement in transport for trade enrollment rates in rural schools and leads to more visits 4. Transport and climate change: control emissions and to health care services. mitigate impact ■ Workfare programs often contribute to expanding transport networks through small access roads, etc. URBAN AND LOCAL 1. Focus on core elements of the city ■ Smart urban and local development contributes to rising GOVERNMENT productivity, fluid labor markets, and greater market system: management, �nance, and governance STRATEGY 2009 access. 2. Make pro-poor policies a city priority ■ SPL can contributes to increasing income and 3. Support city economies opportunities of vulnerable populations through transfers, 4. Encourage progressive urban land and housing markets skills development, and so on. 5. Promote a safe and sustainable urban environment WATER RESOURCES 1. Focus on management, together with connections ■ Broad-based water resources interventions provide SECTOR STRATEGY between resource use and service management national and regional economic bene�ts to all, including 2004 the poor. 2. Develop and improve management of infrastructure ■ Improved water resources management (such as 3. Recognize political economy of management reform watershed projects in degraded environments) directly bene�t poor people. ■ SPL improves availability of water resources and water resource management through workfare activities and increased basic service delivery. WORLD BANK POST- Goal: Overcome poverty ■ A crisis approach emphasizes targeting the poor and CRISIS DIRECTIONS vulnerable (in particular, women and children) and 1. Target the poor and vulnerable PAPER 2010 creating opportunities for growth. 2. Create opportunities for growth ■ SPL promotes interventions that are essential to protect 3. Provide cooperative models households in the face of crises. 4. Strengthen governance ■ SPL can help countries lay the groundwork for crisis 5. Manage risk and prepare for crises response before it is needed. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 95 Annex 6. Social Protection Strategies Outside of the World Bank To support the development of its new SPL Strategy, b. Summary of key agency the World Bank commissioned a stocktaking analysis strategies and program focus of the international agencies involved in social protection2 that looked at the following: (a) de�nitions Even though there is relative consistency in the of social protection; (b) areas of convergence and conceptual de�nition of social protection, donor divergence among international agencies; and (c) key agencies diverge signi�cantly on how this is challenges in SPL global dialogue. This annex operationalized within their overall agency strategies summarizes the main �ndings of that analysis. and development assistance. Table 1 identi�es general areas of intervention across the broadest range of types of activities that may fall under social a. De�nitions of social protection protection, and then denotes which of these are considered under each agency’s speci�c de�nition of For the effective collaboration among international the social protection �eld. agencies, there must be a common understanding and shared de�nition of social protection. However, There is near universal agreement on a core set of among international agencies there is no standard social protection interventions that comprise social de�nition of social protection or the policy and insurance and safety net operations. About half of the sectoral areas it covers. Despite this, Social Risk agencies that have programs addressing labor market Management (SRM) is the core concept used in issues consider this part of social protection. Several de�nitions of international agencies working in social agencies only consider parts of the labor agenda as protection (Table 1). social protection (for example, standards or child labor). There is no consensus on the other possible Under this general umbrella, several common themes elements of social protection. In some cases, inclusion emerge. Agency de�nitions of social protection under social protection may be determined based on a typically incorporate vulnerability in terms of the bureaucratic division of the work program, rather than a presence and scale of risks and exogenous shocks conceptual one. For example, the WHO only focuses acting upon people. Social protection de�nitions tend on health insurance and HIV/AIDS and UNICEF on to include both the absolute deprivation and child labor, safety nets, and HIV/AIDS—which is more vulnerability of the poorest, as well as the needs of �tting with the narrower mandate of these agencies. the nonpoor for security in the face of shocks. Deprivation is often found as part of social protection de�nitions, most frequently inferring some minimum c. Convergence, divergence and acceptable level of standard of living. Social key issues protection de�nitions typically encompass targeting, with a focus on the poor or the extreme poor as those Moving from individual donor and country social most in need of social protection interventions and/or protection strategies to more regional and multi- certain vulnerable groups. And inclusion is a common partner strategies. Over the last few years, there have theme, with social protection as a means to provide been efforts to frame social protection strategies by excluded populations with protective interventions such entities as the African Union (AU) and the EU. and to promote access to basic services. These efforts have helped provide coherence to 2 This analysis was carried out by Julie Van Domelen. The main international agencies involved in the social protection area and covered in this review include multilateral development banks (Inter-Anerican Development Bank [IDB], ADB [Asian Development Bank], and African Development Bank [AfDB]), UN agencies (ILO, UNDP, UNICEF, WHO), bilateral donors, and the European Union (EU). 96 RESILIENCE, EQUIT Y, OPPORTUNIT Y Table 1 Distribution of Potential Social Protection Interventions by Agency, Classi�cation as Social Protection by Agency is Shaded Labor market policies and programs Social Insurance Safety nets Other Labor market policies, Entrepren- Social funds, including Safe work eurship & Cash and in-kind local Post- conflict, Agency standards conditions ALMPs Child labor micro-�nance Pensions Unemployment Health insurance Disability Public works transfers development natural disaster Micro-insurance World Bank X X X X X X X X X X X X X X ILO X X X X X X X X X X X X X UNDP X X X X X X X X X X X X X X Local funds UNICEF X X WHO X WFP X X X AfDB X X X X X X X ADB X X X X X X X X X X X X X X agriculture IDB X X X X X X X X X X X X X X DFID X X X X X X X X X X X X X GTZ X X X X X X X X X X X X X JICA X X X X X X X X X X X X X CIDA* X X X X X SIDA X X X X X X X X X EU/EC X X X X X X X X X X X X Note: *CIDA strategies do not use the term “social protection� per se. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 97 donor and government policies and programs, deliver bene�ts and scale up or down depending on particularly in Sub-Saharan Africa. what the situation warrants. Consensus that social protection is a core part of pro-poor economic growth. The international d. Key challenges community has come to consensus that social protection programs and policies have a key role to Key challenges identi�ed across international agen- play in poverty reduction. Traditionally, this has been cies include the following: viewed singularly through the lens of equity and ■ Mobilizing the international resources to ful�ll the redistribution. The innovation in the last ten years is the vision of a minimum expanded coverage of basic linking of social protection to the economic growth social protection instruments. agenda. The role of risk and vulnerability and the effects ■ Developing a common classi�cation and shared of shocks on long-term economic growth potential are approach to labor market policies and now accepted as a key driver of pro-poor growth. interventions. Employment and jobs continue to be at the top of the policy agenda of both developed Social protection is viewed as a basic human right by and developing countries. many agencies. Social protection �gures prominently ■ Finding alternative mechanisms to expand social in many international conventions, but there is insurance schemes, for example by using micro- divergence among agencies as to how this right is insurance or building on traditional social actually perceived. There is, however, convergence on insurance mechanisms at the community level. the need for systematic access to a varied set of ■ Developing a more robust empirical basis to social protection instruments. Although there is no assess the impacts of different social protection consensus on the content of the set of social programs on the longer-term transition out of protection instruments, there is also convergence on poverty in order to better substantiate social the need to expand coverage of both social protection as an investment and not just welfare. assistance and social insurance programs, notably among the poorest. The future of social insurance. Reliance on public sector funding and institutions linked to the limited reach of formal labor employment have resulted in exceedingly low coverage rates of social insurance in the developing world. However, insurance is still a preferred mechanism to mitigate risks. The challenge has been how to expand social insurance coverage in a way that is affordable and �ts with the institutional capacities of developing countries. Without such mechanisms, there tends to be an over-reliance on ex-post coping with shocks through safety nets. The need for ‘permanent’ social protection instruments. There has been a signi�cant shift in the view of social protection—in particular social assistance as transitory to the consideration of more permanent mechanisms. In part this is due to the realization that vulnerable populations need more support than one-off compensation schemes. In addition, the volatility and frequency of shocks means that countries need to have developed and in place a basic set of programs able to 98 RESILIENCE, EQUIT Y, OPPORTUNIT Y Box 1 The 2010 European Development Report: Social Protection for Inclusive Development The European social model is characterized by unity in commitment to social protection within a diversity of national experiences in the evolution, functioning and approaches to social protection. In 2010, the EU com- missioned the European Development Report with a focus on social protection, and regionally, on Africa. The Report acknowledges that there is momentum for social protection in Africa and an important supportive role for international assistance in this agenda. The EU position on social protection is that social protection is not only a right but also an investment critical to the success of the wider development approach. Tackling vulnerability and inequality directly impacts build- ing resilience and achieving inclusive growth. Social protection is viewed as a strategic instrument to achieve MDGs targets linked to education, health, gender and poverty outcomes and improve sustainability in many other sectors. It can also be a forward-looking tool to address African current and future needs linked to demographic trends, migration, climate change, and global instability. In addition, it can be an essential means to reinforce social cohesion and the social contract, thus enhancing political accountability and social stability. The Report concludes that social protection is a key missing piece of the development puzzle and can signi�cantly improve the impact of EU development policies. The Report outlines seven priorities for effective intervention in social protection, with a focus on Africa: ■ Make social protection an integral part of EU development policy. Opportunities in the pipe- line should be seized upon to ensure that the wide array of EU approaches and instruments is geared towards providing long-term, predictable, and appropriate support to social protection. ■ Promote and support domestic processes to ensure ownership and lay the foundations for long- term sustainability. ■ Assist in tackling sustainability: Policy dialogue on the �nancial and �scal aspects of social protection as well as broader public �nancial management issues is paramount. Development aid can act as a catalyst for social protection and inclusive growth by relaxing the affordability constraint in a transition phase. ■ Tailor intervention modalities to speci�c contexts and needs. There is no “one size fits all� for support to social protection. Approaches should be deeply rooted in local contexts and underlying politics, to assess both what is most appropriate and what is feasible. ■ Support knowledge building and lesson sharing, including research into the various impacts and benefits of social protection for development, to feed the learning process and enable evidence- based investments and decision-making. ■ Improve the coordination, complimentarity, and coherence of EU action in order to fully comply with the aid effectiveness agenda and with EU treaty obligations. ■ Strengthen EU partnerships for a progressive social protection agenda. The focus is on regional cooperation in social development and social protection, building on the existing momen- tum and instruments as well as cooperation with UN agencies, the private sector, and other SP partners. Source: European Union 2010. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 99 Box 2 The African Union’s Social Protection Agenda The AU’s social protection policy identi�es key strategic challenges in social protection as the following: ■ Addressing social exclusion: by promoting the direct participation of people who are currently outside of social insurance and social assistance programs. ■ The need for conceptual clarity on social protection and policy framework: A lack of a common understanding of social protection and the absence of a coherent policy framework for social protection in Africa is reflected in the uneven responses to poverty and vulnerability and social inequities in most countries. ■ Asymmetric Information and disjointed approaches: There is an urgent need to update informa- tion on what is currently being implemented by African governments. Government interventions are uneven, piecemeal, and range from short term emergency relief to approaches that target special categories of vulnerable people at risk because of age, disabilities, or gender inequities. ■ Lack of employment opportunities for younger job seekers (between 18-35 years) leaves millions of households without the expectation of getting out of poverty. ■ Capacity to advance a social protection agenda: Mainstreaming social protection strategies across government and nongovernmental organizations requires signi�cant institutional and �nancial capacity. The AU’s 2006 Livingstone Call for Action on Social Protection promotes an approach that links employment policies and poverty alleviation and calls for a sustainable basic package of social transfers that is affordable within current resources of governments with the support of international development partners. The recommendations were adopted by the First Session of the AU Conference of Ministers in charge of Social Development held in Namibia in October 2008 and endorsed by the 14th AU Executive Council and 12th Assembly of Heads of State and Government in January/February 2009. Among the strategic options for social protection in Africa, the AU �nds that implementing a social protection agenda is feasible and practicable even in LICs in Africa. However, institutions, resources, state power, and the capacities of government institutions to implement social protection policies differ across countries. Overall, social protection policies, institutions, and �nancing arrangements need to be clear and simple and implementa- tion can be phased in ways that build on what works in existing programs and processes. The main recommendations for moving forward on social protection in Africa are the following: ■ Adopt a pro-poor social protection agenda based on developing a collective vision for reform of social pro- tection, including prioritizing the rights of the poor, the vulnerable and those at risk; ■ Review existing policies and programs against strategic objectives; ■ Integrate policy options and reform process in order to an environment for the introduction of short, medium and long term policy and program changes into a time frame that is realistic; ■ Review and mobilize legislation as an important initial step in building a road map towards a social protec- tion framework in Africa; ■ Prioritize the most vulnerable and at risk within an inclusive approach as a means to prevent further human devastation and social fragmentation; ■ Mobilize resources for social protection and ensure the �nancial sustainability of programs. Source: Taylor (2009) 100 RESILIENCE, EQUIT Y, OPPORTUNIT Y Appendix A Agency De�nitions of Social Protection AGENCY DEFINITION Multilateral Development Banks World Bank Social protection and labor systems, policies, and programs help individuals and societies manage risk and volatility and protect them from poverty and destitution—through instruments that improve resilience, equity, and opportunity. AfDB Social protection and labor market regulation reduce the risk of becoming poor, assist those who are poor to better manage further risks, and ensure a minimal level of welfare to all people (CPIA 2008). ADB The set of policies and programs designed to reduce poverty and vulnerability by promoting ef�cient labor markets, diminishing people’s exposure to risks, and enhancing their capacity to protect themselves against hazards and interruption/loss of income. Social protection consists of �ve major elements: (i) labor markets, (ii) social insurance, (iii) social assistance, (iv) micro and area- based schemes to protect communities, and (v) child protection. IDB Prevention and compensation systems to reduce the impacts of shocks on the Latin American poor. United Nations United A set of public and private policies and programs undertaken by societies in response to various contingencies to offset the absence Nations or substantial reduction of income from work; to provide assistance to families with children as well as provide people with basic health care and housing. ILO The set of public measures that a society provides for its members to protect them against economic and social distress that would be caused by the absence or a substantial reduction of income from work as a result of various contingencies (sickness, maternity, employment injury, unemployment, invalidity, old age, and death of the breadwinner), the provision of health care, and the provision of bene�ts for families with children. UNDP Social protection refers to policies designed to reduce people’s exposure to risks, enhancing their capacity to protect themselves against hazards and loss of income. Social protection involves interventions from public, private, voluntary organizations, and social networks, to support individuals, households and communities prevent, manage, and overcome the hazards, risks, and stresses threatening their present and future well-being. UNICEF A set of public actions that address not only income poverty and economic shocks, but also social vulnerability, thus taking into account the inter-relationship between exclusion and poverty. WFP Integrated systems of institutionalized national measures, which may include contributory pensions, insurance schemes, and safety nets. Bilateral Donors, EU and OECD DFID Social protection can be broadly de�ned as public actions—carried out by the state or privately—that: a) enable people to deal more effectively with risk and their vulnerability to crises and changes in circumstances (such as unemployment or old age); and b) help tackle extreme and chronic poverty. SIDA The concept of social security systems is de�ned as formal systems that create security for human beings in vulnerable situations. EU Measures put in place to provide a minimum standard of welfare and to protect citizens against the risks of inadequate income associated with unemployment, illness, disability, old age, the cost of raising a family, or the death of a spouse or parent. GTZ A framework that helps people to cope with life’s risks and cushion their consequences. OECD Social protection refers to policies and actions that enhance the capacity of poor and vulnerable people to escape from poverty and enable them to better manage risks and shocks. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 101 Annex 7: Results Framework The strategy results framework outlines a series of achievements over the long-term through a outputs and outcomes at the World Bank and country combination of multisector interventions and policy level that will be tracked to assess the strategy’s decisions. Average values for each indicator are performance over the next 10 years. It demonstrates disaggregated by IDA and IBRD countries and by the link between the World Bank’s programs and gender when gender disaggregated data is available. activities under the strategy, changes in country outcomes that are directly attributable to World Bank Tier II: Changes in outcomes and outputs of countries engagement, and impacts in client countries. receiving World Bank support. These indicators track results at the country level directly attributable to World The results framework follows the three-tier approach Bank-supported operations in the three strategy priority consistent with OPCS guidelines3 reflecting areas of strengthening country SPL systems, respectively the World Bank contribution to sector increasing coverage, and promoting opportunity. They development outcomes (Tier 1), country outcomes reflect the World Bank’s accountability as a and outputs attributable to Bank support (Tier 2), and development institution in delivering country level the actions and activities for which the World Bank investments, (usually outputs) linked to key outcomes will be accountable for (Tier 3).4 Each tier tracks that often have multiple determinants. Data for these country and World Bank’s progress in the strategy indicators are aggregated at the country level and main focus areas. Speci�cally— collected bottom-up from project-level data6 through the new core sector indicators, as well as desk reviews Tier I: Country progress on sector development of lending and AAA activities. Speci�cally, the new core outcomes. Country development outcomes in Tier I sector indicators (outlined in the results matrix below) are de�ned within the social protection objectives of will apply to investment lending projects only. They will, improving prevention to achieve security, improving therefore, not be reflective of World Bank SPL protection to achieve equity, and improving promotion engagement through other lending instruments. to achieve opportunity. These indicators are often Summary statistics are reported and disaggregated by medium- and long-term indicators consistent with the IDA and IBRD countries. Future core sector indicator MDGs, common Country Partnership Strategy updates will also be disaggregated by gender. objectives, and Country Policy and Institutional Assessment (CPIA)5 indicators and aligned with the Tier III: Changes in World Bank activities to support Corporate Scorecard and the IDA16 Results partner countries. These indicators track the activities Measurement System. They reflect SPL goals and that the World Bank will undertake to advance benchmark country performance in meeting those strategy in terms of lending engagement, knowledge goals. These are goals to which World Bank- production and dissemination, and broad-based supported SPL work contributes, but do not reflect partnerships, as well as in terms of internal attribution to World Bank engagement as countries organization of processes and resources. Indicators in and all their development partners contribute to these Tier III reflect the principles of engagements and 3 “Results Frameworks for New Sector/Thematic Strategies.� OPCS Guidance Note, World Bank. 4 Tier 3 in the strategy results framework also includes indicators related to World Bank organizational effectiveness (for example staff time spent on cross support) which are tracked in a separate 4th tier in the OPCS framework developed and used for the Corporate Scorecard and the IDA 16 Results Measurement System. 5 In line with the strategy priorities the World Bank is introducing a new CPIA measure to rate the functioning and performance of SPL systems. This new indicator will become part of the regular internal process of monitoring progress towards system building. 6 The results framework focuses on operations falling under the following SPL thematic codes: Social Protection thematic codes: Improving Labor Markets (51), Social Safety Nets (54), Vulnerability Assessment and Monitoring (55), Other Social Protection and Risk management (56), Social Risk Mitigation (87). Speci�cally, indicators in Tier II and III are based on the portfolio mapped to SPL sector plus projects mapped to other sectors having an SPL theme code of 20 percent and above. 102 RESILIENCE, EQUIT Y, OPPORTUNIT Y include measures of effectiveness of the World partnership arrangements, and while at the same time Bank’s SPL portfolio, including IEG reviews, meeting the ambitious strategy goals. The formulation measures of results-orientation, the continued of targets in tier 3 reflects the expected increase in investment in knowledge generation and transmission, the three areas of operating principles identi�ed in the staff time spent on cross support, and partnerships strategy—knowledge (reflected in knowledge with bilateral and multilateral donors, civil society production and dissemination and South-South including trade unions. Data for these indicators are sponsored learning events), collaboration (reflected aggregated at the sector level. indicatively at country level through co-�nancing arrangements in IDA operations and at Bank level The identi�cation and selection of indicators in the through intra-Bank cross-support), and country- results framework was based on data availability and tailored operations, where they reflect the ambitious reliability, drawing from several sources. Speci�cally, objective of keeping maintaining the high quality data sources include the Social Protection Sector performance and results-orientation of the portfolio Strategy Implementation Update (SSIU),7 the pension while expanding our lending engagement to database developed within the SPL anchor, Social challenging contexts as in such as lower institutional Protection Atlas, MDGs, governance indicators, WDI, capacity countries and fragile states. ILO’s key indicators of the labor markets, SPL core sector indicators, the Business Warehouse, IEG reports, and the World Bank Learning Management System. Baseline values are reported for all indicators in the results framework. The year of the most recent available value is set as the baseline year for indicators in tier I. Generally, �scal year 2011 is set as the baseline year for indicators in tier II and III, unless speci�ed in the matrix. The indicators will be regularly reviewed and updated over time, with a thorough review planned for the 2017 �ve year strategy update. Target values are set for indicators in tier 3 as these indicators track performance in areas that the World Bank most directly controls and actions for which the World Bank will be accountable. While baseline values in tier 3 show that SPL is performing remarkably well - and above the World Bank average— the challenge in the next years will be to maintain the high quality of the SPL portfolio, M&E ratings and 7 The SSIU was a key Anchor deliverable to OPCS and was intended to de�ne its strategic priorities in SPL, develop implementation plans for pursuing them, and monitor progress in achieving them. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 103 World Bank Group Results Framework for the SPL Strategy 2012–22 COUNTRY PROGRESS ON SECTOR DEVELOPMENT OUTCOMES (TIER 1) Baseline Data collection Indicators instrument/Source Value Year Share of working age population accruing Patterns of Pension Provision II databas Total 28.7% Latest year available pensions rights [2001–10] IDA 20.3% IBRD 38.9% Pension bene�ciaries to elderly (>60) Patterns of Pension Provision II database Total 39.1% Latest year available population ratio* [2001-2010] IDA 26.0% IBRD 54.1% Percentage of population in the poorest SP Atlas Total 51.0% Latest year available quintile covered by SPL programs [2004–10] IDA 32.5% IBRD 64.0% Poverty gap at $1.25 per day (PPP) WDI Total 6.2% Latest year available [2005–09] IDA 11.1% IBRD 0.9% Percentage of children (7-14) economically Understanding Children Work/WDI Total 21.5% Latest year available active [2001–10] IDA 29.5% IBRD 9.7% Male 23.5% Female 19.5% GDP per person employed (constant 1990 WDI Total 12,836 2008 PPP $) IDA 8,093 IBRD 18,256 Ratio of youth unemployment rate to adult International Income Distribution Database Total 3.0 Latest year available unemployment rate (I2D2) [1998–2008] IDA 2.7 IBRD 3.4 Male 3.3 Female 3.0 Index of SPL system development (scale 1 to Staff calculation Total 3.2 2011 6, 1 the lowest)** IDA 2.8 IBRD 4.0 Note: The “IDA� category includes both IDA and blend countries. The “Total� category includes IDA and IBRD countries. Baseline values are simple average across countries within each group. * This coverage indicator refers to the total number of bene�ciaries (of all ages, including old-age, survivors, and disabled), divided by the population aged 60 and above. Population data in the denominator are for year 2008. The indicator does not capture elderly SA bene�ciaries. ** The SPL system index combines assessment ratings of four main dimensions of SPL system performance. (1) Policy/strategy: the extent to which a country has an overall strategy for social protection and accompanying policies for addressing prevention, protection, and promotion. (2) Coordination: whether there are shared administrative systems that allow for coordination across programs that realize economies of scale and help inform gaps and duplication. (3) Coverage: how well the system as a whole covers the various groups appropriately, providing meaningful bene�ts to whichever subset of the population they are meant to assist. (4) M&E: whether there is access to information on performance to support management, accountability and knowledge generation on program effectiveness. Each of the four main areas is rate from 1 (lowest) to 6 (highest). Baseline value is based on the assessment of 19 countries. 104 RESILIENCE, EQUIT Y, OPPORTUNIT Y CHANGES IN COUNTRY OUTCOMES AND OUTPUTS SUPPORTED BY THE WORLD BANK (TIER 2) Baseline Data collection instrument/ Indicators Source Value Year Percentage of SPL lending operations Project Appraisal Documents (PADs)/ Total 41.0% FY11 active lending (whose components/pillars are explicitly Project documents portfolio aimed at) supporting SPL systems IDA 33.7% IBRD 56.8% Number of countries with lending and Business warehouse Total 71.3 Moving average of last 3 nonlending (ESW,TA) SPL engagement years (FY09-FY11) IDA 40.3 IBRD 29.5 Number of bene�ciaries of safety net SPL Core Sector Indicator IDA 13.4 Cumulative FY10-FY11 programs in IDA countries* (million) closed projects* Number of bene�ciaries of LM programs* SPL Core Sector Indicator Total 1.8 Cumulative FY10-FY11 (million) closed projects* IDA 1.0 IBRD 0.9 Note: The “IDA� category includes both IDA and blend countries. The “Total� category includes IDA and IBRD countries. * Baseline values based on a review of 41 Implementation Completion Reports (ICRs) of projects that closed during FY10 and FY11 (eight ICRs do not report on the number of bene�ciaries covered). Future updates will be based on actual numbers provided in ISRs for the active portfolio. CHANGES IN WORLD BANK ACTIVITIES TO SUPPORT PARTNER COUNTRIES (TIER 3) Baseline Targets Data collection instrument/ Indicators Source Value Year 2017 2022 Percentage of projects rated moderately IEG 75.0% Moving average of 75% 75% satisfactory or better according to IEG Rating * projects approved in the past 3 years (FY08-FY10) Percentage of projects with M&E performance ICRs 69.8% FY10-FY11 70% 70% rated satisfactory or above closed projects Number of downloads of SPL knowledge Omniture Site 34,115 FY11 40,000 45,000 products** Catalyst Number of countries involved in World Bank Anchor calculation 94 FY11 Above # of Above # of sponsored South-South learning events SPL client SPL client countries countries Percentage of SP staff (regions and anchor) time Quarterly report from 15% FY11 15% 15% spent on cross support (grades GF+) *** Chennai Percentage of IDA lending operations having Business Warehouse 27.0% Moving average of 32% 37% co-�nancing partners***** projects approved in the past 3 years (FY08-FY10) Note: * “Outcome % satisfactory� rating for available projects in FY10 portfolio. The SPL baseline value is greater than the World Bank moving average over the same time interval which is 73 precent. ** The indicator tracks the number of downloads of knowledge products (excluding other AAA products) from internal and external SPL anchor website, IDEAS (REPEC) and World Bank documents and reports. ***The World Bank average indicator of inter-VPU cross support for the same year (FY11) is 3.7 percent, much lower than the SPL baseline. Moreover, the World Bank indicator reported in the Corporate Scorecard is de�ned more broadly as “time spent by all professional staff (in grades GE to GI, including managers, as well as ETCs in grades EC1 to EC4 in Regions and Networks) on tasks managed outside their VPU as a percentage of total time recorded by such staff� than our indicator which only accounts for professional staff GF and above. **** The indicator captures co-�nancing from recipients executed TFs, MDTFs, donor partners, and special �nancing. It may not capture whether parallel �nancing is occurring. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 105 Notes 1 Ethiopia’s transfers, through the Productive Safety Nets Program (PSNP), have also helped boost tree-planting and thus helped environmental sustainability. (Andersson, Mekonnen, and Stage 2009). In the Dominican Republic, “The Program impact on earnings was statistically signi�cant for young males and adult females... the estimated Program impact on employment was statistically signi�cant for adult females only� (Aedo and Nuñez 2001). 2 Growth Commission 2008. See also evidence on social protection facilitating the transition in Eastern Europe, where there is evidence that social welfare bene�ts spending facilitated restructuring in the face of falling real wages. See Boeri and Terrell 2002 and Garibaldi and Brixiova 1998. 3 The strategy builds on the World Bank’s �rst social protection and labor strategy (World Bank 2001) and a decade of successful operational and analytical engagement. It maintains the �rst strategy’s fundamental devel- opment objectives—greater security, greater equity and good jobs—and builds on experience and evidence to reframe these objectives to a more explicit operational context consistent with new global priorities and contexts, and reflective of the World Bank’s global social protection and labor practice. 4 This de�nition corresponds to that in the original social protection and labor strategy (World Bank 2001), which was that social protection consists of public interventions (i) to assist individuals, households, and communities in better managing risk, and (ii) to provide support to the critically poor. The three goals of resilience, equity, and opportunity equate to what is more widely known among social protection and labor practitioners as the “3P� framework: prevention, protection, and promotion; see World Bank 2011a, the concept note for this strategy, and Deveraux and Sabates-Wheeler 2004. 5 See the de�nition of equity in the 2006 World Development Report (World Bank 2006). 6 Alderman and Yemstov, 2012. 7 World Bank 2011b. 8 Alatas et al. 2010. 9 For Colombia, Attanasio and others 2008 show that the program raised earnings and employment for both men but especially women. Also see Aedo and Nuñez 2001 for the Dominican Republic. 10 See, for example, World Bank 2010. 11 The World Bank works on child labor issues jointly with the ILO and UNICEF in the Understanding Children’s Work project. See http://www.ucw-project.org/. More details on gender-focused social protection and labor interventions are in Chapter 4 of this strategy. 12 The World Bank is undertaking a process for updating and consolidation of the environmental and social safe- guard policies, and the issue of how the World Bank may address labor standards within the safeguard policies is currently part of listening and consultations around this process. 13 For a compelling review of how Ethiopia’s new approach has saved lives, see the One Campaign video docu- mentary by Mohamed Amin at http://www.youtube.com/watch?v=Iri9Y4A5YfI. 14 “On-budget� refers to funding that is part of the national budget process and includes both government resources and those from development partners. 15 These transfers, through the Productive Safety Nets Program (PSNP), have also helped boost tree-planting and thus helped environmntal sustainability. Andersson, Mekonnen, and Stage 2009. 16 “The CCT program in Turkey raised secondary school enrolment for girls by 10.7 percentage points. In rural areas the program boosted bene�ciary enrolment by 16.7 percentage points overall, especially for boys (22.8 percentage points) compared to non-bene�ciaries�, from Ahmed and others 2006. 17 “The Program impact on earnings was statistically signi�cant for young males and adult females. This result was not sensitive to the number of nearest neighbors. Furthermore, the estimated Program impact on employment was statistically signi�cant for adult females only. Again the result was not sensitive to the number of nearest neighbors. Finally, impact estimates on earnings and employment for the groups with statistically signi�cant results were not sensitive to the different sources of information used to estimate the propensity scores� from Aedo and Nuñez 2001. 106 RESILIENCE, EQUIT Y, OPPORTUNIT Y 18 This de�nition corresponds to that in the original social protection and labor strategy (World Bank 2001), which was that social protection consists of public interventions (i) to assist individuals, households, and communities in better managing risk, and (ii) to provide support to the critically poor. The three goals of resilience, equity, and opportunity equate to what is more widely known among social protection and labor practitioners as the “3P� framework: prevention, protection, and promotion; see World Bank 2011a, the concept note for this strategy, and Deveraux and Sabates-Wheeler 2004. 19 See the de�nition of equity in the 2006 World Development Report (World Bank 2006). 20 The equity principles of protecting against destitution and providing equality of opportunity are articulated in the 2006 World Development Report: Equity and Development 21 This is an operational translation of the “Social Risk Management� Framework that formed the intellectual basis of the �rst Social Protection and Labor strategy (see Holzmann and Jorgensen 2000). The prevention-protection- promotion framework has also been used by the ILO: “There are three broad categories (in Social Security): Promotional measures that aim to improve endowments, exchange entitlements, real incomes and social con- sumption; preventive measures that seek more directly to avert deprivation in speci�c ways; and protective (or safety-net) measures that are yet more speci�c in their objective of guaranteeing relief from deprivation� (as in Guhan 1994). In the academic literature, see Sabates-Wheeler and Devereux 2008). The 3P frameworks has also been adapated by a number of institutions and countries, for example by the African Union. 22 See Alderman and Yemtsov 2012. Background paper to this strategy. 23 Growth Commission (2008): “The Growth Report: Strategies for Sustained Growth and Inclusive Development,� available at www.growthcommission.org. See also evidence on social protection facilitating the transition in Eastern Europe, where there is evidence that social welfare bene�ts spending facilitated restructuring in the face of falling real wages. See Tito Boeri and Katherine Terrell (2002). “Institutional Determinants of Labor Reallocation in Transition.� Journal of Economic Perspectives 16 (1,Winter): 51–76 and Pietro Garibaldi and Zuzana Brixiova (1998). “Labor Market Institutions and Unemployment Dynamics in Transition Economies.� IMF Staff Papers 45(2): 269–308. Washington, DC: IMF. 24 Ibid 25 For SPF-I, see box 2.1, and ILO 2011a. ILO 2005, OECD 2009, EC 2010 discusses links with pro-poor growth; Yemstov et al. 2012 assesses the productive role of social protection, including a review of impacts at the micro, meso and macro levels. 26 See World Bank (2011e): “World Development Report 2013: Jobs—Outline� October 25, 2011, The World Bank, Washington DC. 27 World Bank, 2001b. 28 All dollar amounts are U.S. dollars unless otherwise indicated. 29 Honorati et al. 2012. Background paper to this strategy. 30 Ibid. 31 Lessons from World Bank Group Responses to past Financial Crises (2008), Evaluation brief n.6 IEG, WBG. 32 IEG evaluations ratings, from Business Warehouse. 33 See IEG. 2011a. Executive Summary, page x. 34 Honorati et al., 2012. Background paper to this strategy. 35 See IEG, 2008. 36 See IEG. 2011a and IEG. 2011b. 37 Results Readiness (2010) shows that 50 percent of SPL projects have a IE component. This is the highest per- centage in the World Bank. 38 The social risk management framework identi�es SPL as aiming (i) to assist individuals, households, and commu- nities better manage risk, and (ii) to provide support to the critically poor (Holzmann and Jorgensen, 2000). 39 IPCC 2011. 40 Mitchell and van Aalst 2011. 41 See, for example, the data in Centre for Research on the Epidemiology of Disasters (www.cred.be) and Table 1 in Hale, Razin, and Tong 2008. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 107 42 “New World, New World Bank Group: (I) Post-Crisis Directions�, submitted to the Development Committee, April 20, 2010. 43 See, for example Fact sheet. The UN Social Protection Floor Initiative. July 2010-08-11 available from http:// www.ilo.org 44 Innovative programs outside social protection include weather-based insurance programs that protect farmers (India) or trigger early and effective disbursements of funds to local governments and communities (Ethiopia). 45 The June 2011 International Labor Conference called on member countries to adopt a two-dimensional strategy to extend social protection coverage and build coordinated and comprehensive social protection systems, imple- menting national social protection floors as a �rst priority within such strategies. 46 This section is based on Robalino, Walker, and Rawlings 2012. Background paper to this strategy. 47 For a compelling review of how Ethiopia’s new approach has saved lives, see the One Campaign video docu- mentary by Mohamed Amin at http://www.youtube.com/watch?v=Iri9Y4A5YfI 48 Data from household surveys, SP Atlas 49 World Bank 2011a. 50 World Bank 2011a. 51 Bruni et al. 2010. 52 Strauss and Thomas 2008. 53 Goldstein 1999. 54 Based on World Bank pension database covering 78 LICs, there were about 100 million contributors from a labor force of almost 900 million or about 11 percent. 55 See Chawla, Betcherman and Banerji 2007. 56 Chen and Ravallion 2010. 57 See IEG (2011). 58 See Marzo and Mori. 2012. Background paper to this strategy. 59 See, for example, Heckman 2008. 60 Friedman and Sturdy in Alderman et al. 2011 61 Baird, Friedman, and Schady 2010. 62 Giles and Satriawan 2010. 63 Waters and Pradhan 2003. 64 See World Bank (2010b) 65 See Almeida, Bernstein,and Robalino (forthcoming) 66 The strategy builds on the World Bank’s �rst SPL strategy from (World Bank 2001) and a decade of successful operational and analytical engagement. It maintains the �rst strategy’s fundamental development objectives— greater security, greater equity and good jobs—and builds on experience and evidence to reframe these objectives to a more explicit operational context consistent with new global priorities and contexts, and reflective of the World Bank’s global SPL practice. 67 For more information, see Almeida et al. 2012. Background paper to this strategy. 68 These conclusions and recommendations are developed more fully in the Africa Social Protection Strategy (World Bank 2012) and in the background paper “Social Protection in Low-income Countries (LICs) and Fragile Situations: Challenges and Future Directions� by Andrews et al, 2012 69 See Alatas et al. 2010 for an interesting experimental evaluation in Indonesia between different types of target- ing, which showed that community-based targeting did worse than PMTin identifying the income-poor, but yielded higher satisfaction. The authors explain this by inferring that the community’s conception of poverty was different from that based solely on per-capita consumption. 70 The Economist January 14, 2012 issue has two articles on India’s biometric identity system. 71 Developed by Andrew Mason, drawn from Haddad, Hoddinott, and Alderman 1997; World Bank 2001a; James, Cox-Edwards, and Wong 2008. 108 RESILIENCE, EQUIT Y, OPPORTUNIT Y 72 See, for example, Duflo 2003; and Baird, McIntosh, and Ozler, 2010. 73 See Grosh et al 2008. 74 See FAO,2010. 75 Research also shows that signi�cant reductions in regulations can increase the number of business and wage employment (see Bruhn 2011 and Klapper and Love 2010). Important questions remain in terms of how different regulations and policy interventions affect competition (for example, competition councils, anti-trust law) and ulti- mately jobs. (Hallward-Drieimier and Pritchett 2010). 76 Jovenes programs have a strong emphasis on demand-driven skills training, ensured by ex ante agreements with the private sector to provide internships to their graduates. Wages during the internship are �nanced by the program. 77 The program, which is not speci�cally targeted to a disadvantaged population, provides a stipend equivalent to the minimum wage to bene�ciaries while the private sector businesses provide the training and the internship (for a minimum of 3 months) and cover the training costs. Most importantly, private �rms have to agree to retain at least 70 percent of the trainees for a year each in order to participate in the program (Ibarraran and Rosas, 2009). 78 For a detailed review of programs and a more in depth discussion of the various issues see Almeida et al 2012, a background paper to this strategy. For a recent discussion about how wage subsidies are used in Tunisia see Robalino et al. 2011. 79 Some of these and other programs (such as work-sharing) have also being used to protect jobs during a reces- sion. Their use, however, is more controversial. More effective interventions to temporarily help �rms in distress can include credit and access to public tenders. 80 See the STEP framework as presented in World Bank. 2010b. 81 The material is this box is developed by Hideki Mori 82 Support for monitoring should not be con�ned to client counterparts directly responsible for SPL. As noted in the 2011 IEG report on social safety nets, support is also needed to strengthen central statistical capacity to collect harmonized annual data on expenditures and coverage for SPL programs, as well as to monitor poverty and living standards, especially over the long term and in LICs and fragile states 83 See Basset et al. 2012. 84 “On-budget� refers to funding that is part of the national budget process and includes both government resources and those from development partners. 85 For example, The World Bank Disaster Risk Financing and Insurance (DRFI) Program in the Financial and Private Sector Development network works with countries to increase their �nancial response capacity post-disaster and reduce the economic and �scal burden of natural disasters. The DRFI Program builds on a four pillar approach to increase countries’ �nancial resilience to natural disasters, including sovereign disaster risk �nancing, property catastrophe risk insurance, agricultural insurance, and disaster microinsurance. 86 IFPRI/CSA 2009. 87 Detailed information about the partnership as well as products and activities are available at www.gpye.org 88 The JKP has been launched in mid 2011 and will go live in January 2012. The objective of the JKP is to catalyze a multi-sectoral (HDN, PREM, FPD) approach to the jobs agenda. This is done through partnerships bringing together policy makers, researchers, the private sector, unions and the development community to share lessons learned and best practices and to create new ways to tackle the challenge of expanding job opportunities. Partners include IZA, LACEA, IDRC, McKinsey, Fedesarrollo, AERC, and others. 89 Financed by Austria, Germany, Korea, Norway, and Switzerland. 90 Tier 1 and tier 2 indicators are monitored by LICs and MICs and by gender when data are available. 91 See Rawlings et al. 2011 and Honorati et al 2011. THE WORLD BANK’S SOCIAL PROTECTION AND L ABOR STR ATEGY 109 110 RESILIENCE, EQUIT Y, OPPORTUNIT Y 4 RESILIENCE, EQUIT Y, OPPORTUNIT Y