RESILIENCE, EQUITY, OPPORTUNITY

May 7 11, 2012 Washington, D.C.

The World Banks 2012-2022 Social Protection & Labor Strategy

Main messages
1. Social protection and labor programs and policies are necessary in a risky, changing world 2. Social protection and labor programs and policies work, if well-designed as part of systemic approaches
But there are major remaining agendas in terms of coverage (including to LICs and fragile contexts), responsiveness and productivity

3. To succeed, the Banks work in this area will have to be country-tailored, knowledgedriven and collaborative.
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Whats new in this new strategy?

Stronger focus on solutions and SPL systems that together help people deal with multiple risks. Emphasis on the need for increased engagement in lower-income and fragile contexts. Stress on the central role of jobs and enhanced productivity as the pathway to opportunity. Reconfirmation of the central importance of appropriate evidence and knowledge in the SPL practice, especially South-South.
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Message 1: SPL is necessary in a risky, changing world to help people achieve 3 goals:

Opportunity Resilience
Insuring against Impacts of Different Shocks Promoting Human Capital and Access to Productive Work

Equity
Protecting Against Destitution and Loss of Human Capital
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SPL contributes to growth by.

Building and protecting human capital Providing the security to invest in higher-riskhigher-return activities Promoting greater labor market mobility Stabilizing aggregate demand, notably during recessions Enhancing productive assets and infrastructure (for example, through public works) Reducing inequality in society Making growth-enhancing reforms more politically feasible SPL is also increasingly recognized as a vehicle for implementing social contracts, securing peoples rights, and fulfilling societys obligations
source: Alderman and Yemtsov (2012)

Message 2: SPL programs work, especially if remaining challenges are addressed

Fragmentation
Origin of cash transfers in Sub-Saharan Africa

Low coverage
No transfer Only social insurance Only social assistance Labor market programs 13 13 23 17 9 21 22 70 65 46 32 22 ECA 43 27 46 33

Low productivity
Richer countries Poorer countries
$66.2

$78.3

Outside Government, 45%

Social welfare or related , 35%

12
Percent

$36.9

75

Other, 4% Social Fund, 1%

Social security/ labor , Health, 9% 4% Educatio n, 2%

$4.6

$6.7

$9.5

SS MENA Africa

SAR

LAC

EAP

% of households receiving transfers Source: SP Atlas

Low-skill Medium-skill High-skill jobs jobs jobs

Source: Garcia and Moore (2012)

Source: Acemoglu and Zilibotti (2000)

 and are knit together in SPL Systems:

portfolios of coherent programs that can communicate with each other, often share administrative sub-systems, and work together to deliver resilience, equity and opportunity

Equity: Social pensions Resilience: Oldage pensions, disability insurance Opportunity: Employment services, entrepreneurship, training and skills Equity: Cash and in-kind transfers, public works programs Resilience: Unemployment, disability insurance

Pregnancy, Early childhood

Opportunity: Nutrition/ECD, CCTs for pre-school, health Equity: OVC programs, child allowances Opportunity: CCTs for (girls) education Equity: Child allowances, school feeding

Old age

School age

Working age

Youth

Opportunity: Youth employment programs, skills training

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Example: SPL programs across the life cycle

.so the primary focus of the World Banks SPL Strategy is

To help developing countries move from fragmented approaches to more harmonized systems for social protection and labor

Levels of a SPL System

Administration level:
Aim: Building basic subsystems to support one or more programs for security, equity or opportunity

Program

Program level:
Program

Admin. subsystems

Program

Aim: Improving design of existing programs and harmonizing across portfolio of programs

Policy Level:
Program Aim: Ensuring overall policy coherence across programs and levels of government

Message 3: To succeed, the Banks work will have to be

Tailoring operations to country context, and to evidence of what works

CountryTailored

Knowledge that is focused on results and learning from SouthSouth sharing of practice

KnowledgeDriven

Collaborative

Partnerships that are broad and synergistic across sectors and actors
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From strategy to results: Measuring success

Quality of World Bank activities to Changes in SPL outcomes and support partner countries outputs in countries attributable to World Bank support Percentage of satisfactory projects (IEG Ratings) Percentage of projects with satisfactory M&E (ICRs) Number of downloads of SP&L knowledge products Number of countries involved in World Bank sponsored South-South learning events Percentage of SPL staff time spent on cross-support to countries in other regions Percentage of lending operations in IDA countries having co-financing partners Percentage of World Bank SPL lending operations supporting SPL systems Number of countries with World Bank SPL engagement Number of beneficiaries of World Bank supported SSN programs* Number of beneficiaries of World Bank supported labor market programs* Country progress on key development outcomes Poverty gap at $1.25 per day (PPP) Percentage of population in the poorest quintile covered by SPL programs Share of working age population accruing pensions rights Pension beneficiaries to elderly (>65) population ratio (old age, survivor, disability and social pensions) Percentage of children (7-14) employed Labor productivity: GDP per person employed Youth/adult unemployment rate
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ANNEXES

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Message 1: SPL is necessary in a risky, changing world

More disasters, more easily transmitted
1000 900 800

1300

More pathways out of poverty

1197.6

50

Total disasters

1200

Global <$2/day

45

1100
700 600 500 400 300 200

40

1000

978.3 911.5

35

in millions

900

30

800

25

Natural disasters
1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

700
100 0

20

600 2000 Millions 2007 2011 Share in total employment

15

Source: www.cred.be

Source: ILO Global Employment Trends, 13 2012

in per cent

Pathways to Opportunity through Social Protection and Labor policies

Source: Yemtsov et al 2012 14

Collaboration across sectors

Example: Skills Building and the STEP framework (Source: World Bank 2010)

CCTs: With HNP

CCTs: With Education

Active labor market programs: With Education and PSD

Risk mitigation and innovation: With PSD and FSD

Labor regulations: With PREM-EP and PSD

Building the strategy on strengths: A strong counter-cyclical portfolio

Social Protection and Labors Share in New Lending Commitments Asian Crisis
IBRD IDA 13.22%

11.61% 10.37% 9.65% 9.09% 7.71% 7.17% 5.72% 4.83% 4.37% 3.76% 2.76% 2.17% 1.55% 0.93% FY92 FY93 FY94 FY95 FY96 FY97 FY98 FY99 3.16% 2.30% 2.33% 1.77% 2.70% 2.41% 3.99% 4.25% 7.71% 7.01% 6.55% 5.47% 5.47% 4.61% 3.96% 3.27% 2.32% FFF Crisis 2.56% 5.15% 10.62%

7.30% 5.87% 6.24%

5.64% 5.53%

LAC Crisis
FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

FY08

FY09

FY10 16 FY11

 and excellent portfolio performance

Disbursement Ratio Bank average Commitment at Risk (%) Bank average % Proactivity Bank average Unsatisfactory Projects (%) Bank average Disbursement Lag (%) Bank average
( indicates better than Bank average)

FY11 42 21 9 14 71 61 8 12 -7.2 19

Average FY98-FY11 44 21 13 16 80 78 11 12 15 32
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