The Old Social Protection Curiosity Shop

23 July 2015

The Centre for Social Protection welcomes the joint World Bank and ILO Universal Social Protection Initiative, announced on last month. The two agencies called on world leaders to promote universal social protection, which they define as "adequate cash transfers for all who need them, especially children; benefits and support for people of working age in case of maternity, disability, work injury or for those without jobs; and pensions for all older persons".

"It is a pleasant world we live in, sir, a very pleasant world" (Charles Dickens, The Old Curiosity Shop)

A recent Centre for Social Protection report identified extending coverage to reach those who are currently excluded as one of five major challenges confronting social protection in the coming years. So we fully agree with Jim Yong Kim and Guy Ryder, that: "Anyone who needs social protection should be able to access it." Nonetheless, the World Bank/ILO alliance embodies several curiosities.

Strange bedfellows indeed!

"Misery acquaints a man with strange bedfellows" (William Shakespeare, The Tempest)

The World Bank is in the business of lending money to poor countries, to assist their efforts at reducing poverty – its overarching goals are "ending poverty and boosting shared prosperity".  Conversely, the International Labour Organisation (ILO) works to extend social security to everyone – its overarching goal is to put in place universal social security programmes – but poverty eradication and social protection are not the same thing at all.

Whereas the World Bank loves free markets, the ILO favours regulating markets, through its ‘decent work’ agenda. While the World Bank is, well, a bank, staffed mainly by economists, the ILO is a tripartite agency with government, employer, and worker representatives. While the World Bank has never demonstrated any interest in promoting human rights, the ILO has campaigned for decades for the right to social security for all.

This does not mean the two agencies cannot work together. We applaud the ILO for getting the World Bank to push governments to uphold the right of all their citizens to social protection. But it is curious.

Universal social protection in an era of austerity?

"Austerity is not part of the European treaties; democracy and the principle of popular sovereignty are" (Alexis Tsipras, Prime Minister of Greece)

The call for universalising social protection in low-income countries comes at a time of unprecedented austerity measures across high-income countries. The latest instalment is the sweeping cutbacks reluctantly pushed through parliament on 15 July by the anti-austerity Syriza-led government, against the wishes of the Greek population. This follows the £12 billion cuts in welfare spending in the UK, as announced by the Chancellor on 8 July. Yet the World Bank will now be advising governments elsewhere to “spend! spend! spend!” on social protection. Curious indeed.

In an earlier incarnation, the World Bank had no reluctance in forcing poor people to pay for health care and basic education. In the 1980s and 1990s, World Bank loans were conditional on governments levying user fees for these essential services, despite political and popular resistance and overwhelming evidence about the considerable human costs. The World Bank has changed its mind on user fees, almost admitted it was wrong, and now advocates universal health care, even in low-income countries. Is the World Bank shifting from a neoliberal to a Keynesian economic model? Curiouser and curiouser.

Universal access or universal doublespeak?

"The world, being in the constant commission of vast quantities of injustice … would do well to reflect, that injustice is in itself, to every generous and properly constituted mind, an injury" (Charles Dickens, The Old Curiosity Shop)

Curiously, in the Universal Social Protection Initiative, ‘universal’ does not necessarily mean universal. ‘Universal social protection’ sounds like free goodies for all – but it isn’t: "cash transfers for all who need them" implies targeting the poor, not a ‘Basic Income Grant’ (or B.I.G.) for everybody. For instance, many countries in the Middle East implement universal food subsidies, which ensure 100% coverage but give wealthier people access to more food than they need but poorer people access to less food than they need. Subsidy reform processes now underway across the region, strongly supported by the World Bank, involve abolishing universal subsidies and replacing them with targeted cash transfers. Is this compatible with the World Bank calling for universal social protection?

Similarly, the World Bank has successfully promoted the adoption of conditional cash transfer programmes throughout Latin America and beyond, whereby social protection is withheld from families who fail to comply with conditions on their behaviour. But how are conditional cash transfers compatible with “cash transfers for all who need them”?

In the World Bank’s Social Protection and Labor Strategy of 2012, the phrase “human right” appears only once, and rather equivocally, in an annex called ‘Social Protection Strategies Outside of the World Bank’: "Social protection is viewed as a basic human right by many agencies". Is the World Bank now ready to join hands with “many agencies” – including the ILO – and declare unequivocally that social protection is a basic human right? If so, how will its technical advice and lending portfolio change, to reflect this newfound commitment to social justice? We wait with anticipation – and curiosity.

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