Covid assistance worldwide - Part II

 

According to the International Labor Organization (ILO) convention on social security minimum standards, social protection includes access to health care and income security, particularly in relation to old age, unemployment, sickness, disability, work injury, maternity or loss of a main income earner, as well as for families with children. 

The COVID-19 crisis has exposed and exacerbated the social protection gaps between countries, indeed the pandemic represents a crucial challenge since it has created both a major public help challenge while having serious economic and social impacts. In this sense, the World Bank points out the need for adaptive social protection that “helps build the resilience of poor and vulnerable households by investing in their capacity to prepare for, cope with, and adapt to shocks, ensuring that they do not fall deeper into poverty”. As a matter of fact, this crisis has shown the need to change traditional targeting methods to provide social assistance. 

So, in view of the rapidly deepening economic and social consequences of the COVID-19 crisis, many governments have put in place social measures to support populations. Thus, the ILO World Social Protection Report (2020-2022) states that the pandemic response generated the largest mobilization of social protection measures ever seen, to protect people’s health, jobs and incomes. 

Despiste classical measures (incl. healthcare extension or unemployment insurance schemes) broad categories of additional responses were taken by countries to mitigate the outbreak effects. Then, many states reached those who were previously uncovered by any social protection schemes by extending existing mechanisms and creating new ones. Thus, this article aims to assess three categories of social policy responses to Covid-19 outbreak through national examples : providing income support through social assistance (I), family leave and care policies (II) and old-age and disability benefits (III). 

I: Providing income support through social assistance

The COVID-19 crisis has exposed the devastating consequences of social protection gaps in many countries. Indeed, 55 percent of the world’s population – as many as 4 billion people – are unprotected by social insurance schemes or by universal or social assistance programmes. In many developing countries, social protection coverage in case of income loss due to sickness, unemployment or loss of livelihood is not available or is inadequate. However, income security should provide the resources to lead a dignified life, especially in a crisis that is expected to have prolonged social and economic repercussions. According to the International Labour Organization, 76 countries have increased their social protection benefit levels as a COVID-19 response (incl. India, Indonesia and Ecuador). The main aims were to increase the benefits level and to extend coverage to beneficiaries through existing or new programs. 

In March 2020, the United States’ government launched a 2 trillion american dollars economic relief package, as part of this package stimulus payments were sent directly to American citizens. Most adults got 1 200 american dollars although some got less, depending on income. For every qualifying child age 16 or under, the payment was an additional 500 american dollars. Single adults with Social Security numbers who had an adjusted gross income of 75 000 american dollars or less got the full amount, married couples with no children earning 150 000 american dollars or less received a total of 2 400 american dollars and taxpayers filing as head of household got the full payment if they earned 112 500 american dollars or less. Above those incomes’ amounts, the payment decreased until it stopped altogether for single people earning 99 000 american dollars or married people who had no children and earned 198 000 american dollars, a family with two children would no longer be eligible for any payments if its income surpassed 218 000 american dollars. No application was required if the Internal Revenue Service  (IRS), an agency of the United States federal government that collects income tax and miscellaneous taxes, already had owner bank account information from 2019 or 2018 return, the money was directly transferred based on the recent income-tax figures it already has. The payments were also automatic for people who received Social Security retirement, recipients of federally managed railroad retirement benefits, survivor or disability benefits and supplemental security income. Only if one of this people category had qualifying children, they need to enter additional information through the Internal Revenue Service. Then, in December 2020 the American government authorized additional payments of up to 600 american dollars per adult for eligible individuals and up to 600 american dollars for each qualifying child under age 17. The payments began to be reduced at identical conditions to those under the first measure. Finally in March 2021 nearly 1.9 trillion american dollars pandemic relief package with benefits including another round of stimulus payments was taken by the American Government. This time, the full stimulus payment was 1 400 american dollars, with an identical payment for each child. To qualify for the full 1 400 american dollars a single person had to provide an adjusted gross income of 75 000 american dollars or below. For heads of household, adjusted gross income was 112 500 american dollars or below, and for married couples filing jointly that number had to be 150 000 american dollars or below. For single filers, the checks decreased to zero at 80 000 american dollars. For heads of household, the cutoff was 120 000 american dollars. And for joint filers, the checks stopped at 160 000 american dollars. Like the first stimulus payment, to be eligible a person had to provide a Social Security number. According to the Treasury Department, the government outreached to millions of homeless, rural poor, and other disadvantaged Americans to ensure that they received their money. This included new and continued relationships with homeless shelters, legal aid clinics, and providing information in more than 35 languages. In July 2021, 2.2 million payments with a value of more than 4 billion american dollars have been distributed since March 2021 (third round of stimulus payment). Moreover, about 1.3 million payments, with a value of approximately 2.6 billion american dollars, went to eligible individuals for whom the IRS previously did not have information but who recently filed a tax return, showing the measure’s impact on population traditionally out of the scope of the state.

Uzbekistan has three non-contributory cash assistance programs to support low-income people : the allowance for low-income families, the childcare allowance, the allowance for children aged up to 14. Before the pandemic, these social assistance programs had substantial exclusion errors due to budget-related caps on the number of beneficiaries. Indeed, a World Bank assessment found that 63 percent of the poor were not reached by low-income allowances. The assessment further found that one of the main reasons for exclusion errors was the use of caps in budgeting and in the number of beneficiaries at the local level. The cap resulted in a rationing behavior, whereby limited resources were spread across eligible households, assigning allowances at a lower amount, or applications were postponed or payments of eligible applications were delayed. Consequently, among the poor receiving support, only one-half were pushed above the poverty line commonly used by the World Bank for lower middle-income countries. This trend was made possible by a heavy and non-transparent procedure to obtain social assistance. The social assistance is conditional on household income being below a fixed eligibility threshold equal to 1.5 times the minimum wage, one household can receive only one of the three cash assistance at any given time. A family’s eligibility was determined on the basis of a monthly application and supporting documents (around ten documents had to be provided each month), as well as the outcome of the visit to the family home by the mahalla administration (regional governate). The application was submitted in writing by a family member on behalf of the entire family. Once the application and supporting documentation were submitted, within the next three days the mahalla secretary calculated the family total income by adding together the incomes of all adult members of the family over the last three months preceding the month of the application. Once the mahalla secretary established that the family’s average monthly per capita gross income was below 1.5 times the basic calculation unit, then within the next seven days the mahalla commission visited the family to determine its living standards and assets. The commission filled in a special form reflecting the family composition, information on the land plot, assessment of living standards, and recommendation on whether to assign the allowance or to reject the application. There was no detailed description of how a family visit should be conducted or of assessment criteria and items to check. The commission’s recommendation was then approved by a majority vote from the general assembly of the mahalla. This latter procedure was supposed to guarantee transparency and accountability of the commission. In practice, however, there was some tension between this procedure, aimed and the need to guarantee the confidentiality of applicants. During the pandemic, Uzbekistan has temporarily extended the duration of its social allowances for low-income families by an additional six months from June, financed by its national crisis fund (the Government of Uzbekistan initially responded to the COVID-19 pandemic by announcing a crisis fund of 1 billion american dollars, 2% of GDP, to support the economy and people affected by the crisis). But above all, the Government worked to simplify the application process and relax the eligibility criteria so that coverage could be extended to more families, including those who had applied earlier but were not included due to insufficiency of funding at the time. The simplification project, ‘The Single Registry for Social Protection’, is an electronic system that efficiently connects citizens with the social allowances and services for which they are eligible. It was made on the basis of a testing project in Syrdarya launched in october 2019 and financed by 610 000 american dollars UNICEF’s funds. Government accelerated the project’s generalisation by 1st of January 2021 due to COVID-19 crisis. The main objectives of the implementation of the Unified Register of Social Protection are determined by a radical reduction in the number of certificates and supporting documents required for the provision of public social services and the exclusion of the initial subjective approach in taking decisions by objectively assessing the level of need of low-income families, and others. After submitting a request and entering the necessary data into the system, an electronic exchange of information is carried out in real time with the databases of 9 ministries and departments (the Agency of the Registration Function, the Ministry of Finance, the Pension Fund, the State Committee for the Land, the National Tax Committee, the Ministry of Employment and Professional Relations , The State Center for Personalization, the National Road Safety Service of the Ministry of the Interior and the People's Bank). Based on the criteria and standards established by legislation and on the basis of the data received, the system independently assigns or rejects the appointment of social benefits to the applicant. The decision is communicated by SMS. By automatically determining the level of eligibility of applicants and by comparing verified income against a configurable national minimum income threshold, this new scheme ensures a transparency procedure and that no household is left behind. 

Thus, social assistance permits households to ensure income stability. Also, family leave and care policies permit one to keep working or get an income, while taking care of family members (II). 

II: Family leave and care policies 

According to the UNESCO, the closure of schools, universities and childcare services in more than 100 countries impacted more than 800 million children and youth, in addition many other workers had to provide care to infected family members. Thus, family leave policies have moved to the centre of attention. As a result, some governments expanded statutory sick pay, sickness benefits or other benefits to provide support to workers who have to take care of sick family members or self-isolate (incl. France, Macedonia, Montenegro and Singapore). It is particularly important to support those who cannot telework in a situation when many support structures are closed. It is also crucial to expand childcare support to informal workers. In this order, free and universal services are more likely to reach disadvantaged groups such as informal women workers and their children.

In Poland, if the crèche, kids club, nursery school or school  closed, the parent (if covered by public sick-leave insurance) of a child up to 8 years of age was entitled to receive an additional care allowance, as he/she was forced to provide personal day care for the children at home. It was also available to parents whose children used to be under day care at home provided by remunerated third persons. Parents of disabled children of up to 16 years of age or up to 18 years of age, if the children have officially recognised special educational needs were also covered. The eligible persons had to submit an application for the allowance to the entity that pays sick-leave dues on their behalf (either the employer or the other party to the freelance contracts) or Social Security Institution directly for self-employed. The care allowance amounted to 80% of gross wages or, in case of self-employed, of average monthly revenue (calculated for 12 months). The allowance was available for the entire period of the facilities remaining closed from 12 March 2020 and lasted until 26 July 2020. After the summer holiday, it resumed until 20 September 2020. With the second lockdown the measure was extended for periods: 9 November 2020 to 24 December 2020 and 28 December 2020 to 25 June 2021. Since the allowance became available, more than 1 040.5 thousand delands were granted, whose total worth amounted to 704,7 million zloty (€173,8 million dollars), from national Polish COVID-19 funds.

In India the Government announced the closure of schools and childcare centres as part of lockdown measures. However, many children depend on a midday meal for their food security. In response, as part of a 45 million american dollars project for food security funded by the Kerala Chief Minister Distress Relief Fund, the state Government in Kerala instructed the Anganwadi centres (public childcare facilities) to ensure nutritious meals for children under the age of 6 by delivering free midday meals to the children registered under the Integrated Child Development Services. Under the instructions from the Women and Child Development Department of the state, the Anganwadi workers also delivered raw materials on a weekly basis to the families in their communities. During this period, the Anganwadi workers were categorized as essential workers and continued to earn a salary.

Since the crisis led to school closures, family leave and care policy are a crucial social policy response to Covid-19 outbreak. Also providing support to the most vulnerable, notably old age and disable persons, is a central point of the social response (III). 

III: Old age and disability benefits

In view of the particular vulnerability of older persons and persons with disabilities, old age and disability benefits have a particularly important role to play in ensuring income security during the crisis. Thus several countries provided such incomes (incl. Peru, Serbia and Ukraine). Argentina’s case shows that the complementarity of contributory and non-contributory provision constitutes an integrated delivery structure for these categories. Indeed, one-off cash benefits were provided to them through the existing channels of the national social security institution responsible for providing family benefits, thereby facilitating a rapid response. 

Argentina created a bonus for old-age pensioners that was very efficient due to existing social policies particularly oriented to informal and vulnerable families over the first two decades of the 2000s. Indeed, since 1994, contributory and non-contributory pension schemes have coexisted in Argentina. The non-contributory old-age pension allows Argentina citizens aged 70 or older residing in Argentina to have a monthly fixed amount. Foreigners who wish to access this benefit must prove 40 years of continuous residence in Argentina. Also, the pensioners must not be in receipt of any other pension nor income, not have any assets that would provide income nor any relatives that are legally obliged to provide assistance and able to do so. Targeted 3 000 Argentine pesos (45 american dollars) bonus beneficiaries of contributory and non-contributory systems receiving the minimum pension, were paid in April 2020. The bonus reached more than 4.6 million pensioners. The fiscal cost was 179 million american dollars in total. Also, since 1971 a non-contributory disability benefit has existed in Argentina for disable beneficiaries whose income assets are below a subsistence level. It currently covers people younger than the normal retirement age, who have at least a 76% assessed loss of work capacity, and who do not  receive any other pension, and don’t have any family members able to provide financial or nutritional support. The noncontributory disability pension ceases at the normal retirement age and is replaced by the mentioned old-age social pension. In March 2020, the government transferred to the beneficiaries of this non-contributory disability pension the same 3000 Argentine pesos bonus as pensioners. 

Finally, including vulnerable populations in the crisis policy response is crucial since they are the most hitten. Then, these people should stay a center of attention for future social policies. 

Conclusion and policies implication 

Despite a broad range of social policy responses, more than 4 billions people worldwide still don't have social protection access. Thus, the International Labour Organization stated that the pandemic social responses were insufficient, which has increased gaps between developed countries and developing countries. 

However, the COVID-19 crisis has shown that classical barriers to universal social protection can be overcomed, notably by extending the social protection beneficiaries, launching new social protection programs, creating new innovative family policies and providing incomes to the most vulnerables. Beyond the crisis, the spirit of these policies should be further developed in order to achieve universal social protection.

An article was prepared in the framework of the Project – "Improving the rights of employees in the formal and informal sectors". The Project is funded by the Open Society Georgia Foundation (OSGF)

The opinions expressed in the article are the sole responsibility of the author and may not express the position of the Open Society Georgia Foundation (OSGF)

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