Nepal presents a critical
case where
well-designed social safety nets can provide the much needed support to
vulnerable segments of the population, in order to avoid entrampment in
the spiral of poverty or social exclusion. In its 2005 report (ILO,
2005), the ILO identified social protection as one of the three key
elements "of a secure social safety net for those affected by crisis".
Social protection through basic pensions, basic health care and basic
education are key elements in alleviating and preventing poverty, and
can help mitigate the adverse effects of chronic poverty (ILO 2001;
2002).
Following an analysis of the development of social security and
its implications for poverty reduction in OECD countries, a recent ILO
report (Townsend, 2007) notes that "... social security schemes
involving entire populations and categories of the population like
young children and disabled people in developing countries, i.e. social
insurance and tax-financed "universal" group schemes, deserve priority,
even if for reasons of limited resources they have to be phased in by
stages...".
Well designed social security provisions are a necessary component of
measures put in place to attain the targets of the Millennium
Development Goals, set by the international community. Parly as a
result of the conflict in Nepal, the country's progress towards meeting
the Millennium Development Goals has fallen well behind the targets.
The UNDP in its 2006 report on the assessment of needs for Nepal,
indicated that in order to achieve the MDG targets in Nepal, more than
US$ 6.3 billion is needed for reducing hunger, improving education and
developing infrastructure (UNDP, 2006). A well-designed social security
system has a central role to play in overcoming the plight of poverty
and social exclusion in which so many of the country's people remain
trapped.
Overview
Between 1995-96 and 2003-04, Nepal’s poverty rate has
declined from 42%
to 31%. GDP has grown by almost 5% per annum and disposable income of
households has been growing even faster due to the large inflows of
remittances. However, 7.5 million people remain in poverty in Nepal and
there is significant inequity across geography and caste.
A broad range of risks affect Nepali households, including health
shocks, disability, widowhood, globalization, old age, children at
risk, and risks stemming from conflict. The main determinants of
vulnerability are socioeconomic factors, discrimination, and the
conflict.
Social Protection
Challenges
While the government does have some social protection programs -
including civil service pension system and safety nets, including
social pensions, food-for-work, micro-credit, micro-insurance, etc.,
the overall reach of the programs, as measured by the number of
beneficiaries and budget is small.
The key social protection issues are primarily that government
expenditures on social protection is low. However, the recent
Government budget has significantly expanded the breadth of social
protection programs and their planned expenditure on social protection.
For example the Government is considering a workfare program, expanding
school meals and putting in place a food distribution system.
Given the expansive nature of these programs, and to ensure effective
delivery, it will be important to ensure that their design and
institutional and implementation arrangements are in place prior to
roll out. Second, aside from basic income support, there is a need to
consider social services assist households fleeing their residences and
protect women and children from exploitative labor arrangements and
human trafficking.
Finally, to promote peace, the Government is considering how to expand
short term employment programs to consolidate peace, including
re-integrating combatants and affected populations back into the
economic and social life.
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Statistics
on NEPAL:
Total population:
29.9 million
(UN Population Division | World Population Prospects, 2010)
GDP per capita (PPP
US $):
1156
(World Bank | WDI, 2009)
GDP growth (in %):
4.7
(World Bank | WDI, 2009)
GDP Current in
national
currency: 960.0 billion
(World Bank | WDI, 2009)
Human Development
Index
Value: 0.428
(UNDP | Human Development Indicators, 2010)
HDI Rank:
138
(UNDP | Human Development Indicators, 2010)
Total expenditures
on
health as % of GDP: 4.9
(WHO | WHO Statistical System, 2008)
Govt. expenditure on
health as % of total govt. expenditure:
9.20
(WHO | WHO Statistical System, 2006)
Public Social
Protection
and Health Expenditure as percentage of GDP:
1.78
(IMF, 2007)
Public Social
Protection
and Health Expenditure as percentage of General Government Expenditure:
9.21
(IMF, 2006)
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