Poverty rates and different ranges of safety net coverage are intertwined in Bangladesh to provide a better human life to the subaltern people. Having much success and progress, a large number of people are still combating poverty due to factors like rapid urbanization and environmental degradation.
You Can Also Read: Is Urbanization Charges to Alter Asia’s Population Density?
Also, facts provided that despite the extension of safety nets, including cash transfers under multiple social backup programs and healthcare subsidies, yet, challenges are persisting due to bureaucratic hurdles, imbalance geographic allocations, and local leaders’ wrong doing to mitigate gaps in social protection. Effective safety nets require improved targeting and sustainable interventions, investing in education and livelihoods. Addressing systemic barriers is essential for building a more equitable society.
Recent study on poverty rate and safety net coverage
A recent Planning Commission report reveals a concerning surge in the number of beneficiaries of social safety net programs, nearly doubling those living below the poverty line. Policymakers express worries about the efficacy of these programs, suspecting that resources meant for the truly vulnerable might be diverted. The report highlights biases in beneficiary selection at grassroots levels and instances of corruption leading to fund misallocation. It suggests that while coverage appears comprehensive, there are discrepancies, with both deserving individuals excluded and ineligible ones included.
The report recommends addressing these issues by linking financial data with National Identification (NID) cards to streamline beneficiary identification. Additionally, it proposes introducing Management Information Systems (MIS) for accurate beneficiary identification and suggests annual verification of lists to ensure the inclusion of the needy and exclusion of those financially well-off. The report also stresses the need for formal performance evaluation systems for social security programs. Lastly, it discusses the allocation of funds for various social safety net programs, highlighting disparities in distribution and the importance of targeting genuinely impoverished individuals.
Safety Net Programs in Bangladesh
Safety net programs play a crucial role in addressing poverty and vulnerability by assisting various population groups.
These programs aim to reduce poverty and enhance human capital.
They cover a range of assistance forms, including:
- Income security for the elderly, widows, and persons with disabilities
- Temporary employment opportunities for working-age men and women
- Support for the healthy development of young mothers and children
Impact on Poverty Reduction:
The World Bank has been supporting Bangladesh since 2010 to maximize the impact of safety net programs on the poorest households.
Efforts focus on making programs more pro-poor by:
- Enhancing administrative systems to identify the most vulnerable objectively
- Delivering benefits and services timely and efficiently
- Strengthening citizen engagement
- Investments in human capacity building and technology are critical
Types of Safety Net Programs in Bangladesh:
- Cash/in-kind transfers: These provide direct financial or material support
- Public works: Creating temporary employment opportunities
- Incentive schemes: Encouraging education and health for poor and vulnerable households
Coverage and Poverty Rate
Approximately 11 percent of people in urban areas are covered by social protection programs, while 19 percent of the urban population lives in poverty.
In rural areas, the coverage is higher than the poverty rate. Programs reach 36 percent of people, but 26 percent still live in poverty.
Challenges and Opportunities
The social protection programs are mostly focused on rural areas. However, with nearly 1 in 5 urban residents living in poverty, there is a need to rebalance geographic allocations between rural and urban areas.
Using a social registry, such as the National Household Database, can improve the targeting of both programs and households at a reduced cost.
Investing in early childhood is essential for breaking the cycle of poverty across generations.
Expenditure and Gaps
In FY 20, Bangladesh spent about 2.6 percent of GDP on social protection, which aligns with countries of similar income levels.
However, some risk groups remain underserved, particularly in programming for early years and economic inclusion of poor and vulnerable youth and adults.
For example, in every eight poor persons, one is a young child, yet the poor young children receive only 1.6 percent of social protection expenditures.
In summary, while Bangladesh has made progress in expanding social protection coverage, there is room for improvement in targeting, allocation, and addressing specific vulnerable groups
World Banks Support
Over the past decade, the World Bank has been a vital partner in Bangladesh’s efforts to enhance its safety net programs, contributing to significant strides in poverty reduction and social protection. According to data from the World Bank, between 2010 and 2020, the institution provided substantial financial support totaling over $5 billion to bolster safety nets in Bangladesh.
In FY 2019, Bangladesh allocated approximately BDT 642 billion (equivalent to 2.5% of GDP) for social programs, including safety nets. The World Bank’s financial and technical support continues to improve poverty outcomes and human capital development.
This support has facilitated the expansion and improvement of key initiatives such as the Vulnerable Group Development (VGD) program, the Employment Generation Program for the Poorest (EGPP), and the Food for Education program. Through targeted interventions and capacity-building initiatives, World Bank assistance has helped strengthen the resilience of vulnerable communities, enabling them to better cope with economic shocks and adversities. The collaboration between the World Bank and Bangladesh underscores the importance of international partnerships in advancing social development agendas and fostering inclusive growth.
Beyond question, social protection programs have a crucial role in the country’s sustainable development policy, particularly in benefiting poorer households. But there are need for more budget, proper mapping of funds allocation, and improvement of the targeted people under these programs, if so, then there is a right hope that Bangladesh can move further to reduce poverty.
