Social Protection Financing in Africa: Key Considerations for a Changing World

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 “Social Protection Finance for a changing World of Work - Key
Considerations For A Responsive Financing Framework For
Social Protection In Africa ”
 
 Mutale Wakunuma
Institute for Social Policy in Africa
Zambia Regional Office
director@instituteforsocialpolicyafrica.com
 
Outline
 
01
 
02
 
03
 
04
 
Contextual Overview
 
Social Protection in the Region
 
Current SP Financing Architecture
 
African Social Protection Context and the future of
African Social Protection Context and the future of
work
work
 
05
 
What the future should look like
What the future should look like
 
Contextual Overview
 
Population: 
334,166,067
Regional GDP (Simple average
): 38,28 $bn
(2016)
GDP Per Capita: 
1,761$
Gini coefficient: 
0.55
Poverty: 43% (2012)
 
Poverty and Inequality
 
P
O
V
E
R
T
Y
 
&
 
I
N
E
Q
U
A
L
I
T
Y
 
Differences between Countries are significant
 
Employment
High levels of unemployment
High levels of informal activity
(often more than 90% of the
workforce)
Mostly labour intensive
High levels of illiteracy
Highly unskilled labour force
 
Social Protection
in the Region
 
Characterised by low levels of social protection coverage
(6%-20%)
 
Contributory social security coverage (5%)
 
Spending on social protection is typically in the region 1.6
% of GDP.
 
Dominant programming is Agricultural subsidy, Cash Tran
sfers and School feeding
 
Response to poverty and vulnerability and lately inequality
 
Still fairly dependent on donor funding
 
 
The Current Social Protection Financing
Architecture
 
Historical Perspective, 0.7% of GNI
Price Tag for Sustainable Development 5 to 7
trillion, deficit 2.5 trillion
Challenges with ODA for Social Protection in the
SDG Dispensation (peak of $142.6 billion in 2016)
 World Bank estimated that between 50 and 80
percent of what’s required will come from domestic
resources.
Blended Finance – Social good versus profit
 
 
How much do countries spend on SP?
 
Simple mean of GDP allocated to SP:
 
On average, 11%.
Weighted by population:
 
8.4 per cent of the GDP.
In SSA?
 
1.7% of GDP 
on average to non-
 
contributory
 
 
 
Current Financing Picture
 
Where it gets Interesting
 
Banking on Blended Finance and Domestic Resources
 
Minimally Investing in Social Protection and Banking on
ODA
 
D
o
m
e
s
t
i
c
 
R
e
s
o
u
r
c
e
s
 
O
D
A
 
T
h
e
 
A
f
r
i
c
a
n
 
S
o
c
i
a
l
 
P
r
o
t
e
c
t
i
o
n
 
C
o
n
t
e
x
t
 
a
n
d
 
t
h
e
f
u
t
u
r
e
 
o
f
 
w
o
r
k
 
Employment still largely
Informal
 
Social Protection coverage
challenges
 
Financing Gap hugely
unresolved
 
0
2
 
0
1
 
0
3
 
E
m
p
l
o
y
m
e
n
t
 
S
o
c
i
a
l
 
P
r
o
t
e
c
t
i
o
n
 
F
i
n
a
n
c
i
n
g
 
Key Considerations for a responsive Social
Protection System for the Future of Work
 
D
a
t
a
 
S
y
s
t
e
m
s
 
B
e
n
e
f
i
t
 
P
o
r
t
a
b
i
l
i
t
y
 
R
e
t
h
i
n
k
i
n
g
 
T
a
x
 
F
i
s
c
a
l
 
S
p
a
c
e
 
E
x
p
a
n
s
i
o
n
 
D
o
m
e
s
t
i
c
 
R
e
s
o
u
r
c
i
n
g
 
R
e
s
t
r
u
c
t
u
r
i
n
g
 
E
d
u
c
a
t
i
o
n
 
Data systems will be pivotal to the identification of Social
Protection Needs and policy design
 
Regulations should be modified and simplified to address t
he challenges from changes in work.
 
Reducing tax reliance on low income earners and curbing
tax competition
 
Earmarked taxes or through taxation of natural resource
extraction
 
Sustainability through increased levels of domestic finan
cing and Legislation
 
Education system and skills development as a core ele
ment of Social Protection provision
 
That’s it!
Thank you for your Attention
 
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Understanding the current landscape of social protection financing in Africa is crucial for addressing challenges such as poverty, inequality, and unemployment. With low social protection coverage and dependency on donor funding, a responsive financing framework is needed to ensure sustainable development and improved well-being for the region's population.


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  1. Social Protection Finance for a changing World of Work - Key Considerations For A Responsive Financing Framework For Social Protection In Africa Mutale Wakunuma Institute for Social Policy in Africa Zambia Regional Office director@instituteforsocialpolicyafrica.com

  2. Outline 01 Contextual Overview 02 Social Protection in the Region 03 Current SP Financing Architecture 04 African Social Protection Context and the future of work 05 What the future should look like

  3. Contextual Overview Population: 334,166,067 Regional GDP (Simple average): 38,28 $bn (2016) GDP Per Capita: 1,761$ Gini coefficient: 0.55 Poverty: 43% (2012) Country GDP USD bn Year Angola 89,63 2016 Botswana 15,27 2016 D. R. Congo 35 2016 Lesotho 2,2 2016 Madagascar 9,991 2016 Malawi 5,442 2016 Mauritius 12,16 2016 Mozambique 11,01 2016 SADC Countries GDP Namibia 10,27 2016 350 2500 300 South Africa 2000 294,8 2016 250 1500 Swaziland 200 3,727 2016 150 1000 Seychelles 1,427 2016 100 500 50 Tanzania 47,43 2016 0 0 Zambia 19,55 2016 Zimbabwe 16,29 2016 GDP USD bn Year

  4. Poverty and Inequality POVERTY & INEQUALITY Differences between Countries are significant

  5. Employment High levels of unemployment High levels of informal activity (often more than 90% of the workforce) Mostly labour intensive High levels of illiteracy Highly unskilled labour force

  6. Social Protection in the Region Characterised by low levels of social protection coverage (6%-20%) Contributory social security coverage (5%) Spending on social protection is typically in the region 1.6 % of GDP. Dominant programming is Agricultural subsidy, Cash Tran sfers and School feeding Response to poverty and vulnerability and lately inequality Still fairly dependent on donor funding

  7. The Current Social Protection Financing Architecture Historical Perspective, 0.7% of GNI Price Tag for Sustainable Development 5 to 7 trillion, deficit 2.5 trillion Challenges with ODA for Social Protection in the SDG Dispensation (peak of $142.6 billion in 2016) World Bank estimated that between 50 and 80 percent of what s required will come from domestic resources. Blended Finance Social good versus profit

  8. How much do countries spend on SP? Simple mean of GDP allocated to SP: On average, 11%. Weighted by population: 8.4 per cent of the GDP. In SSA? 1.7% of GDP on average to non- contributory

  9. Current Financing Picture Where it gets Interesting Banking on Blended Finance and Domestic Resources ODA Domestic Resources Minimally Investing in Social Protection and Banking on ODA

  10. The African Social Protection Context and the future of work 02 03 01 Social Protection Employment still largely Informal Financing Employment Social Protection coverage challenges Financing Gap hugely unresolved

  11. Key Considerations for a responsive Social Protection System for the Future of Work Data Systems Fiscal Space Expansion Earmarked taxes or through taxation of natural resource Data systems will be pivotal to the identification of Social Protection Needs and policy design extraction Benefit Portability Domestic Resourcing Regulations should be modified and simplified to address t he challenges from changes in work. Sustainability through increased levels of domestic finan cing and Legislation Rethinking Tax Restructuring Education Education system and skills development as a core ele ment of Social Protection provision Reducing tax reliance on low income earners and curbing tax competition

  12. Thats it! Thank you for your Attention

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