Social safety net reform adds social insurance
Graphics: Agamir Somoy
Several types of social safety net programs are active in the country to uplift the underprivileged population of society. Now, some changes are coming to these programs.
At the very beginning, the ongoing 90 programs will be reduced to 30. Apart from the Family and Farmer Cards, 14 new activities, including social insurance, will be added to social security.
The Next Generation Social Protection Policy will be formulated. This overhaul is being introduced to provide some relief to the relevant population, including poverty alleviation and reducing inequality. 31 challenges have been identified in managing the social safety net programs.
Besides, the budget allocation in the sector will be increased from 2.11 percent in the 2026-27 fiscal year to 3 percent of the GDP in each of the next four fiscal years.
Government’s Five-Year Strategic Framework confirmed the information.
General Economics Division (GED) Member (Secretary) Manzur Hossain is in charge of preparing the framework. He told Agamir Somoy, “Social security programs will be made production-oriented. Because there will be an effort to ensure that the programs in which the government invests are result-based.”
Mentioning that a large social protection system already exists in the country, Manzur said, “Due to a lack of sufficiently strong focus on poverty and vulnerability, its effectiveness has become limited because of category-based programs or specific eligibility criteria such as the elderly, widows, persons with disabilities, and students.
“Although many programs are organized around poverty and vulnerability, recent analytical work has highlighted this structural gap.”
Reviewing the framework showed that the new programs will include an “Employment Injury” scheme. This will be transformed from an experimental phase into a statutory national system through the formulation of a law.
Moreover, targeted employment programs will be launched, including poultry and duck rearing, livestock rearing, handicrafts, cottage industries, small businesses, computer and digital skills training, along with low-cost microfinance and equipment support for the employment of marginalized communities, rural illiterate people, housewives, the elderly, and the long-term unemployed.
There is also a plan to provide assistance to the informal economy. Under this, a safe working environment, social protection, healthcare, and fair wages will be ensured for rickshaw pullers, day laborers, hawkers, street vendors, transport workers, security guards, the Harijan community, and all others working in unorganized and private sectors.
Training will be arranged through public and private initiatives to expand opportunities for daily wage earners. Under social insurance, legal and insurance-related foundations will be established for unemployment, maternity, and sickness insurance.
Alongside this, a national labor database will be created. To strengthen social security, a law will be enacted to establish a Social Security Unit. The budget will also be rationalized.
In this regard, actual social protection will be separated from expenditures such as general spending, subsidies, and infrastructure. Under humanitarian assistance, disaster relief, emergency food, and cash assistance will be integrated under a single humanitarian assistance program.
An integrated system will be established by restructuring the migrant worker protection system across the migration cycle, incorporating pre-departure financial assistance, consular support during employment, and reintegration after return.
July fighters will also be brought under social programs. An independent and credible evaluation will be utilized and promoted through a reform dashboard. A social registry system will also be developed.
The significant challenges of the social security programs are - selecting the correct beneficiaries, showing exaggerated allocations by adding subsidies and infrastructure expenditures (with actual spending being only 0.9 percent of GDP), low meaningful impact due to about 90 programs being scattered, not determining allocations based on reality, individual-centric activities instead of reducing household poverty, and a lack of efficiency, transparency, and accountability.
