To mitigate the social impact of the COVID-19 crisis, a significant number of countries have introduced temporary cash transfers to population groups in, or at risk of, poverty. These payments have responded to the specific needs of these vulnerable groups who are immediately affected by a reduction in their job opportunities or income. In addition to supporting low-income families, children, informal economy workers or older persons with low or no pension income, a number of cash transfer programmes have also aimed at maintaining domestic consumption.
Emergency benefits for vulnerable population groups have taken different forms and can be classified as follows:
- Temporary cash benefits: Newly created cash benefits paid on a regular basis for a restricted period have been introduced by a significant number of countries. Eligibility conditions vary, but are often based on income, job loss and household size.
- One-time lump sum payments: Countries have implemented special one-time payments to support vulnerable groups to shoulder extraordinary needs related to health care costs, job loss or repatriation. In some cases, such payments were made to the entire population in an effort to support consumption.
- Augment payments of existing benefits: Some social security institutions have been mandated to temporarily increase the benefits of current beneficiaries, for instance through a doubling of their benefits during one or more months.
- Earlier payment of benefits: The payment of benefits before their regular date has been implemented in many social security programmes, and could most frequently be observed in the case of old-age pensions. In addition to responding to specific income needs related to the COVID-19 crisis, an important objective has also been to avoid health risks connected to a potential overcrowding of payment centres.
- Temporary relaxation of eligibility conditions: To increase the number of eligible households, a number of countries have facilitated the access to poverty alleviation benefits. In these cases, income or asset tests were relaxed and documentary or other administrative requirements were reduced.
- Extending the coverage of existing benefits: Some countries have extended existing benefits to hitherto uncovered population groups, and a specific effort to include workers in the informal economy can be observed.
Examples of measures
In Kenya, a one-off cash transfer was paid to the elderly, orphans and other vulnerable groups. In Argentina, the introduction of a Family Emergency Benefit supported close to 9 million households. Although this benefit targeted low-income families, 3.8 million beneficiaries are one-person households of which 1.5 million are below the age of 25. In Peru, a “380 soles Bond” as part of a campaign “I am staying home” (Yo me quedo en casa) was paid to the already defined group of the most vulnerable families in the country, but it has been extended to also include some self-employed person households. Australia has paid a temporary coronavirus supplement to recipients of a range of existing social assistance benefits.
Canada introduced three distinct benefits for different sub-groups within the elderly. Montenegro and Israel also supported old-age pensioners through one-time extra cash payments.
Taking into account the impact of the crisis on jobs, Namibia introduced a one-off payment to workers in both the formal and the informal sectors who have lost their jobs. As many migrant workers lost their jobs during the coronavirus crisis, the Philippines supported stranded Overseas Filipino Workers in shouldering the repatriation costs.
In Paraguay, households in receipt of the poverty alleviation cash transfer Tekoporã received an extra payment. Recipients of the poverty reduction Bantuan Sara Hindup (BSH) program in Malaysia also received an extra payment, and both the regular and the additional payments were brought forward from May to March. In Singapore, seniors who are beneficiaries of the PAssion Card received an additional cash benefit.
Extending the coverage of existing programs, Brazil announced the extension of existing conditional cash transfer programs to more than one million additional families. The BSH cash transfer program in Malaysia was also extended to an additional 1.2 million households.
Social security institutions as delivery mechanisms
The rapid implementation of emergency payments to low-income groups and workers in the informal economy is administratively complex and challenging. Building on existing capacities and knowledge, many countries mandated social security institutions to deliver these newly created benefits. This clearly demonstrate the importance of having a well-oiled social security administrative capacity, namely the people, technology, infrastructure and governance ready to provide relief in time of crisis. The ISSA refers to this as the ‘machinery’ of social security: it must be built, maintained, enhanced and readily available 24/7.
Social security institutions have responded through making use of highly-trained and committed staff, digital tools, adaptability and innovation. In Canada, for example, rapid and easy access to benefits for the elderly was made possible using existing databases, automation, redeployment of staff and effective inter-institutional cooperation.
In Argentina, existing databases and the targeted collection of additional information on vulnerable population groups through an adapted application process allowed the social National Social Security Administration (Administración Nacional de la Seguridad Social, ANSES) to implement the Family Emergency Benefit. The design, approval and implementation of this new benefit for close to 9 million households in a matter of weeks has only been possible due to the available expertise in benefit administration. Importantly, this experience will also inform efforts to extend regular social security programs and to enhance contribution collection in the future.
The Namibian Social Security Commission rapidly created a new electronic application process for the implementation of the cash benefits introduced as part of the national stimulus package. While in a first phase workers already registered with the Commission were considered, the registration of informal economy workers with the Commission is also being tackled.
A number of previous ISSA articles have analysed in more detail the importance of staff commitment and skills, digital tools and adaptability of social security institutions to enable national responses to the coronavirus crisis. In all cases, social security administrations have been a major asset for the crisis response and ultimately for the resilience of societies and economies. In the absence of appropriate administrative capacities, however, some countries had difficulty in the ability to design and deliver needed relief.
Preventing and alleviating poverty, supporting families, children, the elderly and other vulnerable groups as well as maintaining consumption have been important objectives of different types of emergency cash benefits introduced after the onset of the coronavirus crisis.
Complementing measures in different branches of social security and financed through general government revenues, these benefits were introduced to reduce the immediate hardship of those that are the least resilient to economic fluctuations, job losses and sharp income reductions.
Overcoming administrative complexities in the context of COVID-19 related restrictions, the capacities and adaptability of social security institutions enabled the delivery of many of these benefits in very short time frames.
The continued and appropriate investment in building, maintaining and enhancing social security administrative capacity is an enabler of national resilience and is an important lesson of the crisis. In this regard, the ISSA is complementing its series of Guidelines by developing new Guidelines on business continuity and resilient social security.