Opening remark by Nick Beresford: Launch of Report on Graduation-Based Social Protection ProgrammesJan 11, 2018
Excellencies, ladies and Gentlemen.
A very good morning to you all. I welcome and thank you for joining this important event, the launch of innovative research on the benefits of adopting graduation-based models of social protection in Cambodia.
There can be few more pressing reforms for a middle-income country than the establishment of a core system of social protection. Such systems, built around ensuring life-cycle and basic floor coverage, guard against risk and vulnerability, enable the eradication of poverty, and in turn, promote a productive and inclusive economy.
The Royal Government of Cambodia has had stunning success in the eradication of poverty – from 54% to now well under 13.5% in 15 years - and more than tripling the economy in the same period. We applaud the Government for keeping the eradication of poverty at the heart of the rectangular strategy and national strategic plans. But what got us here does not necessarily work going forward. In the Middle Income Country context poverty is often a classic “last mile” problem. A significant proportion of Cambodians, especially in remote and marginal areas, live in extreme poverty, outside the reach of the mainstream economy, for whom growth has become less effective in delivering poverty reduction. Moreover, with social modernization, family and community forms of support and informal protection are coming under stress. We have a strong political commitment under the SDGs to leave no one behind. This research offers practical ways Royal Government of Cambodia can implement programmes to get the job done.
I pay tribute to the Royal Government for recognizing these issues, and for responding positively by developing the National Social Protection Policy Framework. Its publication in mid-2017 represents a comprehensive vision for reform. Graduation approaches, which aim to address vulnerability and poverty of the poorest households by providing productive assets in place of cash transfers alone, offer a useful option for rolling-out and concretizing the National Framework.
Graduation approaches used extensively in other countries with similar contexts have shown their worth, in delivering poverty reduction and livelihood gains for working age households, particularly for the poorest households living in rural areas. By providing productive assets and support, they enable the poor to help themselves to secure a lasting exit from poverty. As you will shortly hear, our researchers, using rigorous modeling techniques, show these approaches are well-suited to Cambodia’s development context, and the latent potential of the rural economy to drive further reductions in poverty. The results show they perform better than cash-only transfers in enabling rural poor households to become economically self-resilient.
Economic, private sector driven growth, has been key to the success in Camboida’s rise. We agree and that has been one of the starting points of our research. What makes this work I think fresh and so relevant to the Cambodian context is that it shows that social protection and growth can be mutually re-enforcing. The tired debate of private sector growth advocates on side, and on the other socal assistance folk, misses a key point. Bringing more citizens into the productive economy makes the productive economy bigger and grow faster.
Our research shows for various gradation packages that there is a positive impact on key macroeconomic variables. As such they offer win-win outcomes, delivering poverty reduction by enhancing productivity, which in turn enables the generation of resources to support their expansion. Indeed, on the favoured graduation package, the return on the initial outlay after only 2 years is a striking 30%. In essence, graduation programmes can pay for themselves, and offer a fiscally efficient mechanism for tackling extreme poverty. The researchers’ model also allows for analysis of the complementary effects of these graduation packages with local infrastructure and agricultural investments, and here too they find strongly positive results, which each accelerating the impact of the other.
Overall graduation-based social protection offers a promising option for addressing working age poverty, particularly in marginal areas, and one which we strongly urge the Government to consider. UNDP is now exploring options for field testing these models in a major pilot, as a means of proving further evidence to inform scaled-up national delivery.
In closing, we also recognize that approaches are one among many innovations, including life-cycle transfers, conditional cash transfers and others that might be employed as the national framework is rolled-out. These programmes, would of course, have to be developed in an integrated and systemic way, with graduation-based models forming a part of a wider system of instruments. UNDP therefore stands with other development partners, in offering to assist the Royal Government in taking these and other approaches forward and building modern and fit for purpose social protection in Cambodia.
You can listen to his speech here: UNDP Cambodia Facebook