Politicisation of social protection gets vivid in pandemic: Rehman Sobhan

Wrong or politically motivated selection of beneficiaries are leading to politicisation of social protection programmes – a long-standing problem that has become more vivid amid the pandemic, says economist Prof Rehman Sobhan.

Referring to his research on this issue in the pre-independence era, he said, "You now have hundred thousand crores of social protection going on. The safety net schemes are now being used as political weapons."

Prof Sobhan wondered what differences Covid-19 has actually brought to the economy as the structural issues that Bangladesh now severely faces have been left unaddressed even after being identified a long time ago.

The economist also raised questions over the inclusion of pensions, savings certificate interests and freedom fighters' allowances to the social protection budgets.

"If you minus these categories, the actual allocation in social safety net programmes is less than 1% of the GDP," he commented at a virtual dialogue arranged by the Centre for Policy Dialogue and Oxfam in Bangladesh on social protection and employment aspects in the national budget proposed for the fiscal 2021-22.

The economist suggested intervention programmes targeting the poverty vulnerable population.

"The rickshaw pullers have already been vulnerable to poverty for the last 25 years. Many of them slipped into poverty during the pandemic as we did not intervene earlier to alleviate the risks."

Prof Rehman Sobhan advocated for an institutional unemployment insurance programme to deal with specific crises.

The economists also criticised the lack of a serious discussion on the budget in parliament.

"The budget is more in the nature of a sort of drama. Where in fact discussions take place, quite a number of MPs will come and say that I want to have a project in my area, and praise the finance minister without actually knowing about the budget," he commented.

Dr Debapriya Bhattacharya, a distinguished fellow at the CPD, said the social safety allocation seems higher because various elements, such as pension and interest payments and subsidies, have been included in it. 

 The amount earmarked for the social protection sector is less than required and a part of which is not implemented. Many eligible beneficiaries also remain out of social safety net allowances, Debapriya also said.

For example, elderly people in Bangladesh have been getting Tk500 in monthly allowance for the last few years, while In India, people aged under 80 are getting Tk720 in Bangladeshi currency and those above Tk1,000, he added.

If Bangladesh's per capita income is higher than India's, why are the poor in the country getting comparatively less allowance? he questioned.

Professor Mustafizur Rahman, a distinguished fellow at the CPD, said poverty is a multidimensional problem. So, it should be dealt with accordingly. 

He reiterated the need for data and a participatory budget formulation.

Former minister Rashed Khan Menon said the "new poor" have been left out in the budget. He also highlighted that the budget formulation process needs to be more participatory through discussion with various stakeholders before preparing the budget.

Expressing his dissatisfaction over lower budgetary allocation for the health sector and the failure of even implementing it, he questioned, "When India can increase the health budget amid the pandemic by 133%, why did we increase it by only 13%? Why has the allocation for health been reduced considering the size of the GDP?"

Lawmaker Prof Ali Ashraf, chairman of the Parliamentary Standing Committee on Government Assurances, stressed the need for expanding the tax net, which will allow higher government expenditure in vital sectors like social protection. 

He said only 25 lakh out of 18 crore people pay tax regularly, which is a major obstacle for the government to increase spending for the wellbeing of poor people.

As a big number of capable people have remained outside the tax net, the lawmaker stressed conducting a study to identify them.

While presenting a keynote paper at the event, Towfiqul Islam Khan, senior research fellow of the CPD, said the allocation for the social safety net programmes remained unchanged at 3.1% of the GDP in the budget proposed for the next fiscal, but it reduced to 2.4% of the GDP excluding pension for public servants, which was 2.4% in the revised budget in the FY21.

He said two other components - savings certificate interest assistance and agricultural subsidy - are reported as part of social protection included with the programmes that inflate allocation. These three components account for 38.6% of social protection.

Suggesting excluding these components from social protection, he said the size of the net social safety net will reduce to 1.9% of the GDP in the next fiscal year from 2.1% in the current fiscal year.

"The proposed allocation for social protection increased by 12.5% in the next fiscal year compared to that of the current fiscal year, but 84.3% of the incremental amount belongs to three - interest, subsidy and pension," he added.

The allocation for the poor increased by Tk1,878 crore out of the incremental amount Tk11,931 crore, he said.

The paper revealed that social protection allocation for livelihood programmes has reduced substantially in the next fiscal year, including three education stipends.

Student stipends for primary education fell by 48.8%, while the drop is 35% for secondary, higher secondary and madrasah education.

Dr Laila Ashrafun, professor and head of the Department of Sociology at Shahjalal University of Science and Technology, said the true requirement of social protection is not fully known owing to a lack of dialogue with stakeholders.

Dr Manisha Chakraborty, member secretary of Bangladesh Samajtantrik Dal's Barisal Committee, stated that the budget should be formulated based on people's needs.

"Most of the people engaged in the informal sector, home workers, hotel workers, even school teachers lost their income. Why cannot the finance minister find poverty?" she questioned, recommending reducing VAT on food items to maintain food in the affordability of the poor.

 Ashekur Rahman, assistant resident representative, at the United Nations Development Programme (UNDP), said the government formulated social safety net programmes worth more than Tk1 lakh crore and one in every four people has been beneficiaries of the programmes. 

Despite two big taglines, the actual allocation for the programmes excluding pensions and interests is lower, that is why it failed to address the new poor.

Dr Fahmida Khatun, executive director of the CPD, Dr Dipankar Datta, country director of Oxfam in Bangladesh, and people from several areas were connected to the virtual event.