What Are Social Safety Nets? *
Social safety nets are non-contributory transfers designed to provide regular and predictable support to targeted poor and vulnerable people. These are also referred to as “social assistance” or “social transfers.” Social safety nets are part of broader social protection systems that may also include measures such as contributory insurance and various labor market policies. The report considered five types of social safety net programs, including conditional cash transfers, unconditional cash transfers, conditional in-kind transfers, unconditional in-kind transfers, and public works. General subsidies were not included in the review, while targeted and traceable waivers and subsidies were considered.
The global scale of social safety nets can potentially cover almost all of the world’s extreme poor.
Over 1 billion people in developing countries (or a fifth of the population) participate in at least one social safety net program. The estimate is based on a review of 475 programs in 146 countries. Therefore, the global scale of social safety nets is close to the number of people (1.2 billion) living on less than $1.25 per day.
But the glass is only 1/3 full—most of the extreme poor are not covered by social safety nets. Only 345 million are covered by social safety nets, according to the most recent World Bank estimates. About 870 million people in extreme poverty remain uncovered. There are two primary reasons or this. First, there are still many countries (both low-income and middle-income) that do not have scaled-up social safety net programs. Second, many social safety nets may not specifically target the income-poor, but instead have objectives such as improving nutrition, protecting orphans, or providing old age security.
One-third of social safety net beneficiaries live in countries where only 12 percent of the extreme poor live. Some 352 million people of those receiving social safety net transfers are in upper- middle-income countries (UMICs). These countries host only one in eight of the extreme poor worldwide.
The poorest countries are worse-off in terms of covering the extreme poor. About 479 million extremely poor people in lower-middle-income countries (LMICs) lack social safety net support. In low-income countries (LICs), where 47 percent of the population is extremely poor, social safety nets cover less than 10 percent of the population (or only about one every five extremely poor people). To cover all the extremely poor, social safety nets need to expand and include an additional 300 million extremely poor people, hence at least doubling in size for these countries.
Yet there has been an exponential growth in social safety nets, especially cash-based programs. The expansion of cash transfers is particularly evident in Sub-Saharan Africa. For example, back in 2010, 21 countries in the continent (or about half) had some form of unconditional cash transfer in place; by 2013, the number had almost doubled and social safety nets are now implemented in 37 African countries. Globally, the number of countries with conditional cash transfers increased from 27 in 2008 to 52 in 2013, while countries with public works expanded from 62 in 2011 to 85 countries in just two years.
Now every country has at least one social safety net program in place. For instance, school feed- ing programs are present in 130 countries and are the most widespread type of social safety net. Unconditional cash transfers are also common and now are implemented in 118 countries globally.
The five largest programs in the world account for almost half of global coverage. India’s National Rural Employment Guarantee Scheme, India’s School Feeding Program, China’s Di Bao, Brazil’s Bolsa Familia and Programa de Alimentacao Escolar have a combined reach of over 486 million people. The coverage of individual flagship programs shows significant variation, ranging from covering less than 1 percent of the population in some countries to over 30 percent in Brazil, Ecuador, Sri Lanka, Mongolia, and St Lucia.
* This publication begins a series that will monitor and report on social safety nets in developing countries. This first report in the series provides key social safety nets statistics and explains trends using information from 146 countries, including detailed household survey data from 69 countries in the World Bank’s Atlas of Social Protection: Indicators of Resilience and Equity (ASPIRE) database. This report reviews important policy and practical developments in social safety net programs and highlights emerging innovations. While the primary focus is on developing and emerging countries, it also includes some references to high-income settings. This report is designed for policymakers, analysts, and practitioners interested in both social safety nets in particular and social protection more widely.