World Bank’s definition of ‘universal’ social protection – another buzzword?

The Covid-19 pandemic and its related shocks have revealed the value of public services and social protection floors. Institutions tasked with ending poverty like the World Bank are increasingly under pressure to support vital public services and play a key role in wider universal social protection (USP) discussions. The World Bank recently released its latest commitment to social protection: A Social Protection and Jobs Compass to “chart a course towards USP,” which provides guidance to Bank staff on jobs and social protection issues.

Following a limited consultation process, civil society were eager to respond to the Compass. Lena Simet of Human Rights Watch concluded that the Compass guidance note, “makes a strong commitment to USP. However, its guidance on how countries can get there is problematic.”

The Bretton Woods Institutions (BWIs) have long been challenged on their claims of being pro-poor in their approach to social protection. A wealth of evidence has highlighted the flaws of the targeted approaches to social protection preferred by the BWIs, such as Conditional Cash Transfers (CCTs), which have been shown to be ineffective at reaching the poorest – as the Bank itself acknowledged – prone to corruption, and less likely to protect human rights than universal schemes.

Instead of simply dismissing public social insurance and potentially creating costly parallel structures, we call on the World Bank to support countries in adapting their social security systems to be more inclusive.

The International Trade Union Congress released a statement citing “considerable reservations”, about the Compass as it “prioritise[s] the extension of targeted, non-contributory social assistance at the expense of social security, especially pensions.” The Global Coalition for Social Protection Floors (GCSPF) also responded, echoing concerns about the Bank’s ‘universal’ approach, citing incompatibility with the Bank’s focus on privatised and voluntary schemes, and a “lack of references and alignment with human rights and international labour standards,” such as social security minimum standards of the International Labour Organisation (ILO) Convention 102 and Recommendation 202. GCSPF also highlighted that both private finance and voluntary private schemes, which rely on individuals to have savings and often are inaccessible to informal workers, are considered by the Bank to be alternatives to public social security. The Bank’s preference for privately schemes and targeted systems, which are methods to define eligibility for programmes between the poor, not only “fail to cover the majority of the population but also fail to reach the people living in dire situations, [it] also prevents States from developing their own social protection systems,” noted a September report by civil society organisations (CSOs) Action Against Hunger, Development Pathways and Act Church of Sweden titled Can a leopard change it’s spots?.

Dr Laura Alfers, of global network Women in Informal Employment: Globalizing and Organising (WIEGO) commented: “We welcome the commitment by the World Bank to Universal Social Protection. As informal workers remain largely excluded from social protection, it is encouraging that efforts to extend coverage to the ‘missing majority’ are central to the World Bank’s new strategy. However, we disagree with the promotion of voluntary savings schemes, which are presented as central tools to expand coverage to informal workers, and as ‘alternatives’ rather than complements to public social security. Instead of simply dismissing public social insurance and potentially creating costly parallel structures, we call on the World Bank to support countries in adapting their social security systems to be more inclusive.”

‘Universal’ support, with a side of austerity

The World Bank’s influence over countries’ social protection spaces is significant; it describes itself as the largest funder of social protection, citing a portfolio of $29.5 billion across 71 countries. The Bank commits to the Global Partnership for Universal Social Protection to Achieve the Sustainable Development Goals (USP2030), a mission to achieve Sustainable Development Goal (SDG) 1.3.” Further to this, the Bank entered a global partnership with the ILO on achieving universal social protection in 2016.

USP2030 defines USP as “nationally defined system[s] of policies and programmes that provide equitable access to all people and protect them throughout their lives against poverty and risks to their livelihoods and well-being,” which can consist of “cash or in-kind benefits, contributory or non-contributory schemes, and programmes to enhance human capital, productive assets, and access to jobs…benefits/support for people of working age in case of maternity, disability, work injury or for those without jobs; and pensions for all older persons.” USP2030 also defines universal social protection as a human right.

UK-based CSO Development Pathways found that the BWIs not only do harm by prioritising poverty targeting, but have actively advocated for removing universal systems created by governments (see Observer Spring 2018). Both institutions tend to attach austerity-driven loan conditionalities focused on shrinking fiscal space and cutting public sector wage bills (see Observer Winter 2019), and national social protection systems are often the target of such cuts.

8 December 2022

Source: Bretton Woods Project.

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