[Rachelle Akuffo] My name is Rachelle Akuffo, and I will be your host this morning. Now, social protection is a lifeline for poor people. It helps protect people against shocks today, and helps build resilience and human capital to make the most of tomorrow. Now, beyond direct cash or in-kind support, it includes policies and programs that help people improve their earnings and secure better jobs. Now, the State of Social Protection Report 2025 examines global trends in social protection systems. It documents how countries are strengthening social protection and discusses avenues to gradually close the coverage gap. And that gap is significant. This year’s report shows that three out of four people in low-income countries have no access to social services. Now, despite historic gains over the past decade, a staggering 2 billion people remain without adequate coverage. Now, one of the report’s authors will join us shortly to walk us through the key findings of this year’s report, and then we will be joined by a distinguished panel of policymakers and experts who are working to close this gap in a rapidly changing world. We’d love to hear from all of you so you could share your thoughts anytime using the hashtag #InvestInPeople. We also have experts standing by to answer your questions online at live.worldbank.org. Of course, you can please post your questions in the live chat as well. I’m going to ask, just as a reminder to everyone to silence your phones as we’re going to be hearing some important data. I’d like you to please join me in welcoming Jamele Rigolini, a Senior Advisor for Social Protection and Labor at the World Bank, and one of the authors of the report. [Applause]
[Jamele Rigolini] Hello? Hello, good morning. I’m Jamele Rigolini, and I have a confession to make. I love numbers. I think I work at the right place because here at the World Bank, we love numbers, and the report I’m talking about today is also full of numbers. But more important than the numbers are the human lives behind them. People all around the world struggling to live their dreams, sometimes they’re struggling to just survive. Today, I want to discuss how social protection has empowered many of them and could empower many more to thrive. Social protection is about helping people, directly with cash and in-kind support, such as a minimum income, a pension, or just plain food. A long term to social services and employment programs. These help people climb the ladder of opportunities, access better jobs, and become more self-reliant. As we well know, when people thrive, their countries and economies prosper. Social protection helps children stay in school, and when shocks occur, it prevents families from selling the assets they depend on for their livelihood. Employment programs do not only benefit workers, they also help firms finding people with the right skills, and that boosts productivity. In the report, we document how social protection and labor programs in developing and emerging countries are able to play such a critical role. The first message, I’m happy to say, is one of success. Today, more people have access to social protection than at any point in history. In the past 10 years, social protection has expanded to cover a record number of 4.7 billion people in low and middle-income countries. Three out of four people now live in households who either benefit from or contribute to social protection. And even better, the expansion has been the largest in low-income countries, where coverage more than doubled. This is great news. It means less poverty, more self-reliance, and a brighter future for hundreds of millions of people. Thanks to social protection, when a drought or other shock occurs, beneficiaries in the Sahel are able to avoid a 24% drop in consumption, and they are also 25% less likely to reduce their education or health expenditure. Also, economic inclusion programs are emerging all around the world. These programs help men and women with grants, assets, training, and market access. They can boost income or business revenues by up to 50%. Yet, there is still a long way to go. In the report, we also document that 1.6 billion people in low and middle-income countries remain without any access to social protection, and 400 million more remain severely under covered. It is difficult to imagine 2 billion people in need, but I met some of them. Family families who lived in dire conditions, people with personal tragedies. I met a grandmother in Cape Coast, Ghana. She was well past her working age, but I still have this picture in mind. There she was, all by herself, struggling to take care of her grandchildren who had been abandoned by their parents. I met a young man in Khayelitsha, a township near Cape Town. He was feeling hopeless because there were no jobs. And in Župa, a small town in North Macedonia, I met an elderly couple in a deserted village. For a long time, they could only rely on each other for basic care support. These are four different people in three different countries in three different situations, but it was clear to me that they had all one thing in common. Their difficult lives were finally being radically transformed by the support they received from a small safety net. Unfortunately, despite the massive increase in coverage, progress remains slow. At current rates, it will take 20 more years to cover all the world’s pool with social protection. Can we really wait that long? Can we afford to have millions of children pulled out of school, many of them permanently, each time a shock or crisis happens? Can we afford to have hundreds of millions of workers, many of them youth, being trapped in precarious employment? In the report, we have three simple messages to accelerate progress and provide adequate support to people in need. First, of course, there is a need to expand coverage, but expanding coverage is not just about money. It is also about building the infrastructure needed to grow social protection programs. What do I mean by that? I’m talking about databases, digital payment systems, case management systems. These are required to identify people in need and support them in a timely and effective manner. Building this system takes time. Large-scale programs such as Brazil’s “Bolsa Familia” or Pakistan’s “Benazir Income Support Program” took more than a decade to build and are still being perfected. Second, we need to expand the amount and type of support provided. In many low-income countries, benefits are so low that they barely affect poverty. Low benefits force poor people to focus on survival, and that leaves little room to plan for the future; but again, it is not just about money. It is also about expanding the type of support people receive. We need more social services to address issues such as domestic violence, mental health, or addiction. We urgently need more employment support and economic inclusion to help people access better jobs and become more self-reliant. Third, we need to make social protection systems more responsive to shocks and crises and to the transitions happening all around us. For that, we need to invest in shock-responsive delivery systems, financing mechanisms, governance arrangements that help social protection unemployment programs becoming more sensitive to crises. As you can see, there is lots of room for improvement, but how are we going to pay for it? More money will be needed for sure. But more money is only half of the equation. In many countries, better use of that money can bring us quite far in closing the gap. For instance, energy subsidies benefit the rich more than the poor, and a lot of social assistance goes to the middle class or even the rich. Both could have much more impact supporting the poor. We also need more people to contribute to social protection, especially in the informal sector. This brings me to the end or maybe just the beginning. The grandmother I met in Ghana was not alone in needing help. Let’s work together to provide more people with economic support. Let’s work together to provide more youth with a good first job and let’s work together to provide more elderly with solid care services. At the World Bank, with partners, we have a target to reach 500 million more people with social protection by 2030, half of them women. We look forward to working with governments, partners, and all of you in achieving such an important milestone. Thank you. [Applause]
[Rachelle Akuffo] A big thank you there to Jamele, really putting a human face on the numbers and the impact of progress being made and the progress that still can be made. It is encouraging to hear how social services and labor programs can expand labor opportunities for the poor, especially as we face a looming jobs crisis. As you say, their potential is often underexploited. In an era of constrained financing and shrinking fiscal space, how do we optimize social protection financing? What can governments do to help the poor access more and better jobs? To discuss this, I’m pleased to introduce our panel of experts. Please, join me in welcoming, first, His Excellency, Professor Nentawe Goshwe Yilwatda, Nigeria’s Minister of Humanitarian Affairs, Disaster Management and Social Development. Thank you so much. Please, come up. [Applause] [Rachelle Akuffo] Minister Yilwatda is a distinguished academic and visionary leader and a passionate advocate for humanitarian and poverty reduction initiatives. In addition to his ministerial role, he serves as a member of the Presidential Economic Management team and Chairman of the Euro-African Dialog on Migration and Development. Next, I’d like to welcome Shanta Devarajan, Professor of the Practice of International Development at Georgetown University’s Edmund A. Walsh School of Foreign Service. [Applause] [Rachelle Akuffo] The next seat. He was Senior Director for Development Economics at the World Bank, the Chief Economist of the Middle East and North Africa, Africa and Asia regions, and the Human Development Network. He was also Director of the 2004 World Development Report, Making Services Work for Poor People. And next, Mamta Murthi, Vice President of the People, Vice Presidency at the World Bank. [Applause] [Rachelle Akuffo] In this role, she oversees the global practices for education, health, nutrition, and population, gender, social protection, and jobs, as well as the Human Capital Project. Mamta has held many leadership positions at the World Bank, including as Director of Strategy and Operations in Infrastructure and in the Africa region from 2015 to 2018, and Regional Country Director for the EU based in Brussels. And of course, you can learn more about all of them at live.worldbank.org. A big thank you to all of our panel for being here. So, let’s begin with Minister Yilwatda. Minister, can you share a bit more on the activities that you are leading in Nigeria to help expand social protection coverage, and what lessons have you drawn from these efforts?
[Nentawe Goshwe Yilwatda] Thank you so very much. Let me share some of the experiences we’ve had in Nigeria over a period of a decade. We started our social protection system in 2015. We were supported by the World Bank to implement it. First, we had zero social register. Nobody on the social register in 2015. By 2022, we’ve grown from zero to 30 million. By 2024, 2025 ending, we’re now on 19.7 million, covering, starting from zero individuals on the social register to 71 million people, individuals on the social register, a large coverage. But that’s not just even the impact we’ve made. We’ve been able to meet the giant strike in building the highest social and financial inclusion in the country, having these people, a fraction of them were people who were also actually on the social register, on the financial system, having financial access for their services. And today, all of them now have accounts. They have either an account or an e-wallet for those who are from the same community. It has helped to expand the fintechs in Nigeria because it has deepened the access to financial services by these people. It has also helped to build financial capacity up on the rural community. And that has actually in itself built a new set of young people and young talent in the fintech who are deepening technology, deepening income among the rural poor people. And that in itself has helped rural farmers, helped nano and microscale businesses. So, that’s what we’ve done on the social register within the last one decade. But that’s the social register. The social register actually has formed a bedrock for every other service that we’re also working on, starting with the conditional cash transfer that we have in Nigeria. Just over nine years, we’ve been able to reach out to only 2 million households, covering less than 10 million individuals. Today, we are reaching out to 50 million households, growing from 2 million to 50 million households. These 50 million households cover up as 60 million people. And most importantly, we work with the state statistics from the National Bureau of Statistics of Nigeria, which shows that 42% of Nigerians are poor. That covers probably about 90 million people. And targeting 60 million out of the 90 million is a milestone for us as a country, and we’re providing services for all these people. These are based on the statistics, still, we have more rural poor people than urban poor. In our targeting also, we’re able to reach out to 68% of the people who are reaching out to, out of this 60 million are from the rural poor, and the rest, 32% are from the urban poor. So, when you look at the statistics also, women inclusion, because in Nigeria, if you are born a woman, somebody said, you have double jeopardy of poverty. You have more chances to be poor. We are targeting 65% of the people, the household leaders, are actually women. So, most of the caregivers are also women. And that has built financial inclusion, especially for the women folks. And that also improved their access to financial services. It has impacted, especially the rural women who are actually caregivers. And that, most of the times, if people that come to the rural community are more likely to be out of school. So, the number of out-of-school children are mostly also in these communities also. That in itself has helped us in that regard, but to target the school feeding, to target the out-of-school children, Nigeria has the Homegrown School Feeding Program. We’ve also digitized that process also, giving a digital identity because our national social registry before now, people didn’t have a digital identity. We’re providing this identity to the entire people. We’re also given, apart from giving them bank accounts, we’re also giving them this identity so that can help us in tracing. We’re also geotagging the homes of these 19 million households while geotagging all the households. And that in itself will help us in our responsive… to respond quicker, improve our transparency, and it has actually built confidence among the people in Nigeria. So, these are some of the services we are doing, but the Homegrown School Feeding Program has grown from just about 5 million some three years ago to about 9.6 million. And today, we are targeting 11 million children in the public primary schools by the federal government, and the remaining numbers will be supported by the state governments. This collaboration will help to ensure that most children among the rural poor, and especially people who are within the urban poor also, have access to milk. That will actually help the household, but what we’re doing also in Nigeria, different also is to provide food assistance to the caregivers so that the children will cook food at home and bring it because it will help us in transparency. It will help us also in the response that we’re doing with the parents because most of our programs are actually designed from a bottom-up approach. So, the communities help us in designing the program. They help to shape our program and direct the processes. That’s what we’ve done with the school feeding program to ensure that we respond to the caregivers based on what the bottom approach target that we did within the communities. So, that’s what we’ve done with that. But at the same time, also, we’re working with the young people because we are a youthful population in Nigeria. Over 100 million Nigerians are actually youths, and so we are the largest population of youths in the entire Africa. And a number of them are unemployed or unemployed. We’re working with the private sector to ensure that we create market spaces for them and also create jobs for them with the private sector. We’re starting a program we call “Skill to Wealth,” and we shared the program with the World Bank. Thankfully, the World Bank staff in Nigeria have been very, very useful to us in shaping our programs, designing our programs, providing technical input to what we’re doing, not just them alone, but the collaboration with most of the international partners, the United Nations systems, the CSO, the private sector, they’ve helped in shaping our programs. Just two weeks ago, we held a roundtable of all development partners in Nigeria, and we look at all the problems that we have in the sector. We brought it before the... We had a two-day intensive program. I think the World Bank in Nigeria was part of the process, helping us in the technical session, especially in preparing for the session. The Nigerian system from the private sector, from the government, from different countries, all were part of the process to ensure that we have a system that is responsive. We have a system that also will be targeting raising money from the private sector because of the dwindling support that we’re having from the international community. We’re looking at using the Nigerian market, which is big, the economy is big enough so we can raise money that are approved from the private sector to support the social services. But beyond that, the government is doing in those sectors, we have other social services that are not under my ministry. For example, the pension scheme in Nigeria supports… It covers all the government workers and most of the private sector workers also. Both public and private sector are covered by the pension scheme. We have also the NSITF, which is the National Social Trust Fund. That is meant to protect workers who have work related injuries and also death, and that covers them also. Then, we have the ITF, our Industrial Trust Fund, which support the youth with skills, training, and support them right from campus into outside the campus also, and help in placing them. We work in collaboration with them for job placement. Then we have also… We also have other services that are all driven, like the Health Insurance Scheme that covers both the private sector and the... So, these are, among many other systems, [those] that form our social protection for the vulnerable group in Nigeria, but let me talk about the lesson learned. What are the lessons that we’ve learned as a country? Number one, we’ve learned this lesson that data-driven decision making is very important for us. With the deepening of technology, it has helped us to deepen also our responsive system. I’ll give an example. This data we have from the Bureau of Statistics, like the rural communities, people in the rural community are more likely to be poorer than the people in the cities, urban communities. That helps us in designing our response system. So, these are among many other things. Like I said, my time is up, but these are some of the services. I maybe I will share with time. The other, maybe during a question session. I’ll tell you some of the lessons we’ve learned as a country to ensure that we have a better service delivery in this sector. Thank you. [Applause]
[Rachelle Akuffo] It’s certainly very important because a lot of times people are like, “What are some of the examples?” “How do I do that?” And that very tailored bottom-up approach and the confidence that that inspires then among youth, among women who are also helping the economy. That’s hugely important. I want to make sure that that doesn’t get understated. Professor Devarajan, I want to bring you in here. How can low-income countries continue increasing protection to the poor, given the limited global resources?
[Shanta Devarajan] Thank you very much, and it’s great to be here. Thanks for inviting me. Well, I think Jamele suggested an answer to your question, which is finance is only part of social protection. I think he said “half” I’m not sure whether that was a quantitative estimate or not, but so if you think about it, and that’s true for low-income countries, true. So, if you think about it, if overall financing is only half of the problem, then aid financing is a fraction of that. And then aid from the United States is a fraction of that. Then, we’re only talking about a small part of what has been lost. Now, that doesn’t mean that that was a justified move by the United States. I’m not trying to diminish the importance of that. But from the point of view of social protection, there are many things we can do to continue and accelerate social protection despite the cutback in US foreign aid. Let me just say, if you go back and look at history, two of the most celebrated social protection programs, PROGRESA in Mexico, the first conditional cash transfer program, and NREGA in India, the National Rural Employment Guarantee Act, were both set up without a penny of foreign aid. I know because we tried that at the World Bank. We wanted to finance PROGRESA. We thought it was a great idea. And the Mexican said, “No, we don’t trust that you will allow us to do the randomization that we want to do.” And they were right, I think, to refuse. I remember, in NREGA, I was the Chief Economist for South Asia at the time, and the Indian government came to me and said, “We don’t want any World Bank assistance for this” at that time, the largest social protection program in the world, “But we want Martin Ravallion, your Senior Researcher, to evaluate it.” “So can you find a way to get him here without all the baggage that the World Bank brings with it?” These programs unleashed a whole generation of CCTs and employment guarantee programs without foreign aid. So, we can do it. There’s no question. Now, that said, of course, social protection requires resources. And then, I think the report and Jamele’s presentation does describe the various sources, but I think he doesn’t emphasize enough some of those potential sources. I would say in the report, they talk about domestic resource mobilization, and then they later talk about changing the composition of public expenditures, that there are a lot of wasteful expenditures if we can turn them into useful expenditures. And there, I think case number one are these fuel subsidies. You can do a lot by converting fuel subsidies which are horribly untargeted, to targeted cash transfer. I think Nigeria has tried many times in that domain. And that’s where I think the ideas and the knowledge assistance that social protection brings is extraordinarily important because why is there resistance to reforming fuel subsidies, including by poor people? I mean, that’s the amazing thing. It’s because they don’t really believe that they’re going to get the targeted cash transfers. There’s a credibility problem. Now, if you have a well-structured social protection program in place, these, what do you call… The Dynamic Social Registries, I love that phrase. I’m not sure I know what it means, but it’s a nice phrase. If you have these Dynamic Social Registries in place, then that gives these people more assurance that they will actually get the cash transfer. So, I think we need to explore more the places where you can actually raise resources for social protection by cutting unproductive expenditures. Now, let me go one step further and give you the example, the case of the resource rich countries in Africa, including Nigeria, I might add. These are countries with a lot of money. Gabon has a per capita income of 10,000 dollars. Equatorial Guinea has a per capita income of 20,000 dollars, and they still have poverty rates of 20%, 30%. So, many years ago, some colleagues of mine and I asked the question, what if you took a little bit of these oil resources, the oil revenues that these countries get, and gave it out as cash transfers? We took the extreme view, you do an untargeted cash transfer, something like universal basic income. We asked the question, how much of those oil revenues do you need to eliminate extreme poverty in the country so that the Gabon’s poverty rate would go from 30% to zero? The answer is 20% of those oil revenues. That’s all you need. It’s a little bit higher for Nigeria because of the higher population, but for these small oil-rich countries. So, just think about that. What are we worrying about American foreign aid when you have the resources sitting in your own country and it’s to eliminate poverty, not just help reduce poverty. You can do that. Now, finally, and this was not said in the report or the presentation, but I would say we should also be thinking about resources, or better targeting, or better efficiency of social protection by asking the question, can we do changes within the social protection program? Because it’s no secret that a large part of these social assistance programs leaks to the non-poor. I remember a long time ago, looking at this program that was the predecessor of PROGRESA, which was called PRONASOL in Mexico. PRONASOL was about 1.3% of GDP, giving projects to poor communities. They evaluated it five years afterwards and found it only reduced poverty by 3%. Had they perfectly targeted had that money, it would have reduced poverty by 64%. Had they even given it out as cash equally to the whole Mexican population, it would have reduced poverty by 18%. This was not a social protection program. This was a transfer to the rich. And you look at it, and what you see is those communities that voted for PRI, which was the party in power at that time, and maybe is now, too, right? That voted for PRI were the ones that got most of the money, whether or not they voted for it. And then, I should add that Iffath’s [Anwar Sharif] thesis on Sri Lanka makes the same point with Samurdhi [Allowance], which is another pretty badly targeted program. It’s something like it reaches 30%. This is also about 1% of GDP. It reaches about 30% of the poor and about 18% of the richest quintile of the population. Now, again, if you look at why that’s the case, and this is what Iffath showed in her dissertation, is that those districts that voted between 40% and 60% for the party in power got the most sum-worthy transfers. If they were less than 40% or greater than 60%, they didn’t bother. They were not going to win. Horrible. This political capture of social protection programs. I mean, think about this. This is money given in the hands of the poor that politicians grab and said, “Oh, this can help me win the next election; so I’m going to use it that way.” There’s huge opportunity for restructuring social protection programs for the poor, for heaven’s sake. That’s why we’re trying to do this, that we can use, and now with modern technology and other ways, we can actually keep it out of the hands of the middlemen who are the ones make sure that it goes to the politically expedient rather than the true deserving. If I have a minute, can I say one more thing? [Rachelle Akuffo] We’re a little bit tight on time because I know you also want to get to-- [Shanta Devarajan] I just wanted to add, this is for my World Bank colleagues. The other thing that I found we can make social protection more effective, which is what we need to do anyway, is to actually engage with other sectors. What you find is you have social protection programs that are very nice and well-designed, but not everybody gets access to it. But if you deliver it through the health system or the school feeding that was mentioned, that’s another way. You can reach people in schools or in clinics and vice-versa. Sometimes when they come for social protection, as they do in India, you also give them vitamin supplements and other things. So, this is really a much more broad-based effort we need.
[Rachelle Akuffo] Vice President Murthi, I want to bring you in here because we’re talking about reimagining both within social protection programs and also partnering as well. So, the World Bank has a goal to reach 500 million people, half of them women, with social protection programs by the year 2030. Are you hopeful that this goal can be reached, considering the significant gap that the report also identified?
[Mamta Murthi] Thank you so much for your question. It’s been great to listen to you, Minister, and Shanta, you are such good value every time you speak to us, so I’m really glad you could join. Let me just say a couple of things by way of preamble, and then I’m going to respond to your question, Rachelle. For those of you who don’t know, the World Bank has set itself a target of reaching 500 million people with social protection by 2030. The whole idea was to try and make a dent in this population that does not have access to social protection. Now, your question is, are you hopeful? It’s always a fool’s business to say that you’re confident that something will happen. I certainly don’t believe in doing that, but I think I would say I am hopeful that we will be able to contribute to this target. Let me tell you why I’m hopeful. First of all, this is not something that the World Bank is going to do on its own. As Shanta already mentioned, a large part of the finance, which is only half the challenge, is going to come from the countries themselves. The entire onus is, if you like, not on the World Bank. I think this is very important because this is a part of expanding something that we know is extremely valuable, has impact. I think it’s morally the right thing to do, and economically, it’s the right thing to do. So, the fact that the governments take leadership on this, I think, is the way to go. That’s number one. Number two, this is something that as far as the financing and the technical support goes, we’re not doing this on our own. We’re doing this with other partners. I think that’s a very important thing to recognize. We are, if I can use the term, crowding in others into this space, and I feel together we can be hopeful that we will get there. I want to say that this is not an effort of the social protection group on its own. Shanta, you will be happy to hear this. One of the things that we’ve done is we’ve tried to map out the work that we do ourselves in reaching populations with social protection, and about 75% of it comes from the work that this group, they’re largely social protection, comes from the work that this group does. But 25% of it comes from the agriculture team, the urban team, the financial inclusion team. There’s more than this group that is going to be involved. I think that’s an important part of the hope that we will be able to stretch. I also want to say that it’s not something... This is an effort that I don’t think it’s just the governments and the MDBs, there are lots and lots of private actors in this space. While we might have our quibbles about whether they reach the right populations and how they reach the right populations, I think it’s great that there’s so much private activity. We’ve all heard of GiveDirectly, and that’s just one example of the kind of enthusiasm there is. Here’s why there’s enthusiasm. There’s lots of evidence. The minister spoke about how important data is. The data allows us to build the evidence of what’s working, who’s being reached, what the resources are being used for. I think all of this is contributing to the groundswell of interest in this approach to giving people a helping hand. And the last thing that I want to say is that I think there’s a tendency to think that social protection is about small one-off things that can’t possibly have a long-term impact. I’m caricaturing just a little bit, just to make the point. I see Colin sitting in the audience. We’ve done a lot of work on these... We call them “Cash Plus” programs. Let’s say it’s a cash benefit plus a skills program, which also connects people to markets. We’ve done a lot of work on these kinds of programs. One of the things that is very striking is the long-term effects of doing this. You know the old adage; you can give a man some money... I’ll make it neutral; you can give a person some money and they can catch some fish and eat it, but perhaps the most important thing is to give them the means to catch the fish themselves and then you don’t have to give them the money. Well, that’s what these programs are about. It’s about helping people to be self-reliant. There’s a lot of evidence that this works. We had a lecture by Professor Abhijit Banerjee just last week, and he showed us some evaluations, not of impact 5-10 years after the intervention, but 10-15 years after the intervention. We’re talking half a generation later. And the impact, when you compare these people who received the intervention with others exactly like them who didn’t receive the intervention, well, 10 or 15 years later, this group of people is working longer, is earning more, and have far less food insecurity. So, I think it’s data and evidence like this which is showing that these things work and is contributing to this groundswell of interest in this area. I’m hopeful because I think governments are important actors and they are increasingly persuaded. We’re not doing this alone. We’re working with partners. I think the data and the evidence are really contributing to a groundswell of support, which I think is going to show the way.
[Rachelle Akuffo] Thank you. Just quickly to follow up on that, Professor Devarajan, the report mentions a lot the need to expand employment support. How can we achieve that in countries with large informal economies?
[Shanta Devarajan] Oh, yes, thanks. Thanks very much for that question. It gives me a chance to talk about it, talk about the whole issue that Mamta raised as well, and Jamele mentioned, which is the impact of social protection on employment. I think the question really needs, when you’ve got 70%, 80% of population in the informal sector, the question is really not about jobs, but about productivity. These people all have jobs by definition, if they’re in the informal sector. The problem is these are very low productivity jobs. They’re earning very little. And sometimes they’re working three, four jobs in order to earn more. So, we don’t need to create more jobs for them, we need to help them increase their productivity, sometimes staying in the same job, but that is where social protection comes in because there’s quite a lot of evidence now that you give people cash grants, they actually are able to then take risks with the crops that they’re planting. I mean, these are these studies by FAO and others that show that they can then move into higher-valued crops, but these are higher value and riskier, which they couldn’t afford the risk without the cash grant. They actually then move up, and in the long run, their children are better and so on. So, we can do a lot with this. Let me just add that, and this is particularly important in one group of countries which are the fragile and conflict-affected states, where, informality is even higher, as well as the fact that the key is earnings in these places because their per capita income is declining as a result of the conflict. And there’s a very nice paper by... Everything I said, by the way, is all based on World Bank work, so it must be right.
[Mamta Murthi] You did some of it yourself.
[Shanta Devarajan] No, there’s a very nice recent paper by Klaus Deininger on what is it called? Program support grants. It’s cash transfers to small farmers in Ukraine during the war. And it turns out that you can actually target these because they use of geo-sensing data to verify whether these people are really poor because it only goes to people with less than 80 hectares or something of land. They actually have shown that they transferred this in late 2022 or early 2023, that those who received it, compared to a control group of comparable characteristics that didn’t get it, got a higher productivity level throughout the year. So, there’s plenty of potential for these kinds things, thanks to technology that we can put in place in the most deserving places which are the fragile states.
[Rachelle Akuffo] Thank you. Minister, I want to bring you back in here. In Nigeria, what types of policies and programs are in place to increase coverage in the informal in the local economy?
[Nentawe Goshwe Yilwatda] In the informal sector in Nigeria, most of the... Even the support we are providing under the conditional cash transfer is the informal sector because all the people in the rural community we’re supporting, and all the people in the urban poor we’re supporting, none of them is actively in the other private sector or in the public sector. So, we are supporting people in the informal sector. That’s even the first coverage we’re doing. All these 70 million individuals covering from 50 million households we are supporting this year, none of them will come from either the public or private sector because most of them are already covered by salary, by pension, by health insurance, by the NST, the Social Trust Fund, which covers them in terms of injury and death. Most of the public and private are already covered. Most of our targeting is actually targeting people within the sector. Secondly, even the Home-Grown School Feeding Program, the same thing. People on the move, especially people who are affected by disasters in Nigeria, especially in the northern part of Nigeria, where we have climate-related displacement. Also, we have people who are affected by the armed crisis within the northern part of Nigeria. All of them, we’re supporting them, we’re supporting people who are not in the formal sector. Most of our targeting is, actually all our policies, for now are targeting the social investment program of government is targeting people in the informal sector.
[Rachelle Akuffo] I appreciate your insights. That’s very important, especially when we look at the different makeups of different economies, when we’re applying some of the lessons that can be learned. Vice President Murthi, I want to bring you back in here. Looking ahead, what do you think is the key to closing the social protection gap? And would a stronger focus on jobs and employability be a good way to move forward?
[Mamta Murthi] Thank you, Rachel. That is a tough question. What is central to closing the gap? I’ve already talked about data and evidence, and I think we’re doing well on that front in terms of collecting the evidence; but I do feel that we have a battle to fight because this is an information age and there are all sorts of things, messages that swirl around. I think this message that these are programs that are effective that make people self-reliant, and they don’t actually cost that much. When you look at the scale of the resources that are spent on fairly wasteful things, I think getting that message out is very important. I hope each one of you and everybody online is going to carry that message. I want to make the point about not just effectiveness, but cost effectiveness. There are people who think that these are boutique programs and they are very costly per person who is made self-reliant. Well, that is wrong. I mean, one of the things that we have done as the World Bank that I feel very proud of is that we’ve made an effort to try and get at the cost effectiveness. It’s very hard to get the cost of programs right, by the way. This requires very detailed work and it’s very hard to do, but we’ve done some of this work so that we could look at cost effectiveness. These programs are highly cost-effective. So, getting that information out is a big part of what we need to do. The second thing is to make sure that people understand that this is about self-reliance and making people self-reliant. There is a tendency to say that this is a handout. This is money that will have to be paid year after year after year. I want to go back to my analogy about teaching a person to fish. These are programs that make people self-reliant. I can’t think of a better use of public money. I have to say, I am partisan. I can’t think of a better use of public money than helping make people self-reliant. I think in the world today, when everybody thinks, or most people think that we are at a pivotal moment in history, a lot of things are changing, our trade regimes could be changing, our external assistance regimes could be changing. At a moment like this, I think... Oh, and let me not forget to say that weather patterns are changing significantly. At a time like this, I think the focus on making people self-reliant is something that is very compelling, it seems to me. Actually, as the World Bank, we are pivoting to bring a focus on jobs and productivity. I think given that pivot, making the case for self-reliance is very consistent with that pivot. I’d like to say that all of these arguments, the data, the fact that these are cost-effective interventions, the fact that they show long-term impact, and the fact that they lead to self-reliance, I think making these points is the way to close the gap. I can go into financing and all of that, but to me, I think making the case and rallying around that case is a very important part of getting there.
[Rachelle Akuffo] Well, with that in mind, we have a question that’s coming from the audience. Obviously, our online audience has also been following on. This is a question for any of the panelists who would like to chime in. Can anything already be said about the impact of the current international financial turmoil on running programs? Obviously, you’ve mentioned some of the things that are going on at the moment. Who would like to tackle that mountain?
[Shanta Devarajan] I’ll take the bait. I think we are on the… There’s a very high probability, as Jay Powell would say, that we might be going into a global recession as a result of various policy changes. This is the moment for social protection to step up. It’s almost as if we had had that six-months advance warning of the COVID pandemic, just think how much better we could have done with the preparation, with the dynamic… What was it called again? Registries, and so on. Let’s strengthen those, let’s put those in place, because this is a crisis coming. We can see it coming, the train is coming heading in our direction. Let’s get on with it. That’s why the timing of this report, I know you wrote it before January 20th, but it is impeccable because it gives us a blueprint for doing as much as we can to help these countries and these people withstand the potential global recession.
[Nentawe Goshwe Yilwatda] Let me respond from the point of view of the Nigerian government. After the withdrawal of support from the USA, we did a complete analysis of the support they give us from the health sector to the humanitarian sector, to agriculture, and all the other sectors that we have in the country. We didn’t just analyze the American support also. We analyzed all the support from all our other partners. In the health sector, we discovered the gap was just about 300 million US dollars. We made provision for it in the budget, and it was captured. So, we’re going to provide that in the budget. We did the same thing for even the conditional cash transfer. We discovered a gap was about 250 million dollars. We made provision for it. What the World Bank is providing for us and what we’re providing in our budget, we are going to have excess of about 19 million dollars, so that in case we need to make a quick response, that access can provide the response for us. We’ve done that in other sectors, even for the people on the move, the government has done the same thing. We discovered that their support is going to accumulate to roughly just about 30 million US dollars to the displaced people, we’ve made provision in the budget. So, we’ve made a local provision, an alternative provision, and we’ve made up our minds that even when they come back, they want to have a space because we would have done the needful for our people. And that’s direction the government is taking. [Rachelle Akuffo] I appreciate that. [Applause]
[Rachelle Akuffo] Now, something that also came in from the audience from Pakistan and Jamaica, we received two similar questions, so I’m going to summarize them here. What strategies can be adopted to ensure funding for social protection programs? And how can we ensure those efforts are sustainable over the long term? Vice President, if you’d like to try that one.
[Mamta Murthi] I want to thank the listeners for their questions. I think this is something that we’ve touched upon already in this panel. I think the resources for these programs have to largely come from within. I’m in absolutely no doubt about this. Many of these programs are already being funded significantly from within. I like the characterization that Shanta made. It’s about making sure that expenditures, government money is directed towards these programs because they are effective and they are cost-effective. It’s making sure that you raise more resources domestically if you can for these programs. It’s about taking away from less effective programs and putting the resources into these programs. Finally, it’s about making sure that these programs function as effectively as they can, using whatever tools that you need. The point that was made about digital delivery being really great, being able to reach people with no middleman and reduce the leakage, that’s a point worth underlining. Now, there was a second question about how do you make this sustainable? I think you make this sustainable by making sure there’s political support for these programs. I think that’s by making sure that the benefits of these programs are well understood, not just for the people themselves, but for society as a whole. And that’s a harder thing to do, but I do think it can be done. Look, we talked about NREGA, which is this very large work fair program in India. Shanta mentioned this. This is a program that started some time ago, but it has survived changes in political administration. It’s a very simple program. It guarantees one adult person in every village in India will have income for 100 days of the year at the minimum wage. This is how the program was originally designed. It may have evolved since then. It’s dynamic, so I don’t know. It’s reached a different point, but this is how it evolved. One adult from every household in a rural area is guaranteed 100 days of work at the minimum wage. It’s a workfare program that’s designed to give you a floor of income, particularly during the lean season. Now, lots of things have been added to it, but it’s been sustained through many changes in administration. I think it’s because people have realized that this is really what a caring society does. It’s keeping hunger at the door. It’s actually doing other interesting things that you might think would have political backlash. For example, it’s raised wages in rural areas because you can’t squeeze somebody who’s a daily wage laborer too much, because guess what? They have an alternative. It’s done a lot of things that people didn’t expect, and you might think it would lead to a backlash, but it survived. I think it’s about people coming to recognize that it benefits everyone, not just the not just the people who are reliant on it, but it benefits everyone. That’s the true source of sustainability. I do think it can be done. India is a large, fractious democracy. There are many state-level variations to this program. It doesn’t function as effectively in every state. There are many states where actually the resources that are allocated for the program remain unspent. I mean, that shouldn’t be the case. I’m sure like any large national program in a large country, there is leakage, but it still survives. To me, it’s an example of the thing that it doesn’t have to be perfect to be sustainable.
[Rachelle Akuffo] That’s very important as well. A lot of these things evolve, as you mentioned, with time, with knowledge, with technology as well. As we’re coming to the end of this session, I do want to just get a quick takeaway from each of you for being part of this conversation. What is the message that you want people to walk away from when they look not just at the successes some of the progress, but what could potentially lie ahead? Minister, if you’d like to begin.
[Nentawe Goshwe Yilwatda] For us in Nigeria, the journey ahead is… Look, the future is bright, we’re very hopeful. With the legal framework that has been passed through the Federal Executive Council, has passed through the NEC which governors across the country have approved and adopted, and the National Assembly has also taken it up, that that would engineer funding and support to provide both political and legal framework and operational framework for funding and operation of the social protection system. I’m sure the future for Nigeria is very bright.
[Rachelle Akuffo] Thank you. Professor.
[Shanta Devarajan] Thank you. I want to come back to this point about the coming global recession. I think this is the moment for social protection to step up. We now have the knowledge how to strengthen the system. Let’s make sure we don’t fall into the trap that we fell into with the COVID pandemic, that some of the world’s poorest people were especially hurt, not by the pandemic, but by the global recession caused by the pandemic. That’s exactly what happened in most of sub-Saharan Africa. Let’s make sure we don’t do that yet. And then, I would add to what Mamta was saying about building political support for social protection is really to publicize not just who got the money and how much better off they are, but what are the other characteristics of life that have improved? I think there’s now quite a lot of evidence that cash transfers benefit people’s mental health. I’ve met some of these mothers who say, “My biggest problem is I worry whether I can feed my kids at the end of the month.” “Now, with this money, I can actually be more relaxed and I can work better.” The other is there’s a very nice paper, another World Bank person, Nayantara Singh, looking at the effect of NREGA on domestic violence and showed that the presence of NREGA actually reduces domestic violence. That’s something that society as a whole has to feel. We are better off with less domestic violence in our society. So, these are things that we can actually publicize and build support for social protection.
[Rachelle Akuffo] And lastly, the Vice President.
[Mamta Murthi] Very hard act to follow again, these two gentlemen. I think I would want people to go away with the message that social protection works. It works for the individual and it works for society. We learned from COVID that countries that were better prepared were better able to protect the poorest. It’s never too late to get prepared, and they should get prepared. I feel that this 2-billion-person challenge, I’m hopeful that it can be met.
[Rachelle Akuffo] Appreciate all of you. A big thank you to our panelists. [Applause] [Rachelle Akuffo] A big thank you to all of you here, and online, and at home who submitted your questions and joined the conversation as well. It is important to hear how with the right strategies, countries can create opportunities, reduce inequalities, and increase resilience for generations to come, which is hugely important, of course. Thank you all again. I should let you know the report was possible thanks to the data for the Atlas of Social Protection, Indicators of Resilience and Equity, better known as ASPIRE. You’ll see they had a board outside. If you scan the QR code to learn more about that. So, please stop by the ASPIRE showcase outside the room to learn more about their data products. We know data is important, including ASPIRE AI. Their latest innovation. [Lively music]
