Principal Investigator Abul Barkat Co-Investigators Subhash Kumar Sen Gupta, Abdullah Al Hussain, Matiur Rahman &am

1. IMPROVING THE TARGETING EFFECTIVENESS OF SOCIAL SAFETY NETS IN BANGLADESH Principal Investigator AbulBarkat Co-Investigators Subhash Kumar Sen Gupta, Abdullah Al Hussain, MatiurRahman & Faisal Mohammad Ahamed ManobSaktiUnnayanKendro (MSUK) House 05, Road 08, Mohammadia Housing Society, Mohammadpur, Dhaka 1207 Presented at Workshop on Research to Inform Food and Nutrition Security Policies RuposhiBangla Hotel Dhaka: 3 July, 2013

2. Background and Objectives • Every 3rd household (31.5%; HIES 2010) live in poverty • Social safety net programmes (SSNP) have been mainstay of poverty alleviation strategy since independence • Currently, 24.6% HHs (Rural 30.1% & Urban 9.4%) receive SSNP benefit (HIES 2010), which was 13% in 2005 • In FY 2012-13, Tk. 227.5 billion allocated under Social Protection & Empowerment (11.87% of the budget & equivalent to 2.18% of the GDP) (Social protection 75%; empowerment 25%) • Large amount of money spent on SSNP; number of beneficiaries increasing • Often questioned – whether most eligible persons receive SSNPs? • TARGETING ERROR (both inclusion and exclusion) is thought to be a serious drawback to reach the food insecure and the poor, in addition to capacity constraints (e.g., constrained budget)

3. Background and Objectives … contd.. • This research was expected to: • Provide a comprehensive review of SSNP targeting mechanism & errors that will enable GoBto improve targeting so that it better reaches the food insecure and the poor • Contribute to achieve major national goals of National Food Policy (2006) & National Food Policy Plan of Action (2008-2015) • Objectives: • To identify extent of targeting errors in social safety nets by major programmes • To recommend ways to decrease inclusion & exclusion errors at the programme-level • To identify potential ways forward for building a SSN system in Bangladesh

4. Major Findings based on Secondary Analysis of HIES 2010

5. The HIES 2010 and SSNP in Bangladesh • The HIES 2010 includes (Section 1 Part C) 30 socialsafety net programmes. • The respondent households (n=12,240) were asked 7 questions on safety net programmes.

6. The HIES 2010 and SSNP in Bangladesh • 55% of the SSNP budget spent on programmes listed in HIES 2010; • Pension constitute 20% of SSNP budget (Is ‘Pension’ SSNP?) • Considering the 30 programmes listed in the HIES is a perfect sample for generalizations about overall public safety net sector

7. SSNP Beneficiary Targeting SSNP Targeting of Beneficiary Inclusion Criteria Exclusion Criteria Essential Criteria Priority Criteria The first research issue is identification of targeting errors which can be grouped as inclusion error—meaning inclusion of non-eligible & exclusion error—meaning exclusion of eligible persons We have compiled all the eligibility (inclusion & exclusion) criteria for most of the selected public SSNPs from relevant documents of the respective programmes. Poverty—the most essential targeting criteria ‘Poverty’/’extreme poverty’/’poor household’ is an essential criterion for all the SSNPs along with other criteria such as low income, landlessness, disability, gender, old age, maternity & other vulnerability etc.

8. Poverty, Income, Expenditure and Social Safety Net

9. Poverty HCR and SSNP benefit flow Regional disparity (improper allocation of resources) !!! • Highest % of HHs (37.3%) received benefit from SSNPs in Khulna division. On the basis of poverty HCR, Khulna division ranks fourth • Poverty HCR is highest in Rangpur division (HCR 46.2% and 30.1% using the Upper and the Lower poverty lines respectively), on the basis of SNP beneficiaries, it ranks 3rd position with 33.7% beneficiary HHs

10. % distribution of beneficiary and non-beneficiary HHs by income deciles and residence (rural-urban)

11. % distribution of beneficiary and non-beneficiary HHs by income deciles and residence (rural-urban)

12. % distribution of beneficiary HH of major SSNPs by income deciles

13. % distribution of beneficiary HH of major SSNPs by income deciles

14. Are the HHs getting SSNP poor? • SSNPs are meant for the poor. In Bangladesh, 24.6% HHs receive SSNP (where the poverty rate is 31.5%) • Given an ideal situation (i.e., safety net is for the poor), the above figures seem satisfactory. However, the situation is not as ideal as the figures appear. The reality is as below: SSNP beneficiary HHs below Poverty Lines (HIES, 2010)

15. Poverty and receipt of SSNP benefit

16. Are these non-poor households borderline poor? Per capita expenditure of poor HHs and SSN beneficiary HHs

17. Poverty status of SSNP beneficiaries with and without SSNP benefit amount • Over 60% beneficiaries received ≤ Tk.100 from their respective SSNP in a month;33% received between Tk.100 and Tk.300, and only 4% received between Tk. 301 and Tk.500. What happens if the amount is deducted from the HH income? If SSNP benefit is deducted from the income of the beneficiary households, poverty rate increases by only 2 percentage points

18. Poverty status of beneficiary household (without the benefit amount) by shifted Upper poverty line

19. % of benefit received by beneficiary households

20. % of food expenditure in consumption expenditure • 79% of all households spend more than half of their consumption expenditure in food. • Rate is highest (92.2%) in lowest income decile. • Rate is lowest (44.7%) in top income decile. • Distribution by consumption expenditure deciles provide similar result.

21. % of food expenditure in consumption expenditure by different type of Household

22. Targeting errors in certain SSNPs using programme specific eligibility criteria (HIES 2010)

23. Targeting errors in certain SSNPs using programme specific eligibility criteria (HIES 2010)

24. Inclusion Error and Exclusion Error from HIES 2010 considering Upper Poverty Line

25. Preliminary Findings based on Field Data

26. Field Survey

27. % distribution Poverty status of the SSNP beneficiaries

28. % distribution of SSNP beneficiaries by asset deciles

29. % distribution of SSNP beneficiaries by asset deciles

30. % distribution of SSN beneficiary HHs and non-beneficiary HHs by asset deciles

31. Inclusion error and exclusion error (considering only poverty) According to this table, considering only poverty of the households, the inclusion error rate is 14.2% and exclusion error rate is 26.4%.

32. Inclusion and exclusion error from the field data considering poverty

33. % distribution of reason for not applying for SSNP benefit

34. % distribution of reason for not receiving SSNP benefit (after applying) • 8.1% of the beneficiary HHs reported to have paid bribe in order to receive SSNP benefit • Of all the selected SSNPs; Old Age Allowance, Allowance for the Widow, Deserted and Destitute Women and Vulnerable Group Development beneficiaries reported to have paid more bribes • The average amount of bribe paid by the beneficiaries is 1074.1 taka (those who reported)

35. Sixth Five Year Plan (FY2011-FY2015)

36. On leakage and targeting error in SSNP in the Sixth Five Year Plan The Sixth Five Year Plan of the country states coverage issues, targeting beneficiaries, leakages, and disparity in regional distribution etc as the key challenges of implementing SSNPs are. Some of the highlights are as follows: • While coverage is relatively low, a significant number of HHs gain access to multiple SSNPs. A quarter of HHs were receiving transfers from more than one SSNP. • Over 11% households were participating in at least two of the three programs – VGD, FFE and FFW. Coverage in urban areas remains low. • 27% VGD beneficiaries are not poor. • 11% participants of PESP meet none of the eligibility criteria; almost none of the beneficiaries meet at least three criteria. Almost 47% PESP beneficiaries are non-poor and incorrectly included in program. • All HHs within less-poor Upazila are denied assistance, including those with very high food insecurity.

37. On leakage and targeting error in SSNP in the Sixth Five Year Plan…..contd. • Leakage in FFW program is 26%. • Leakage in female stipend programs 10%-12%. • About 20%-40% budgetary allocations for female secondary stipend program do not reach beneficiaries. • Leakages show a strong correlation with number of intermediaries in the transfer process. • HIES 2005 showed regional disparity in distribution of households receiving social protection benefits. Barisal and Rajshahi divisions, with the highest incidence of poverty, did not have the correspondingly higher number of social protection beneficiaries. In contrast, Sylhet Division, with the second lowest poverty incidence had the highest proportion of social protection recipients.

38. Concluding Observations and Recommendations

39. Concluding observations • Coverage & budgetary allocation in SSNP sector – increasing every year • Every 4th HH is covered by SSNP (HIES 2010) • The declining trend of poverty over the years at a rate of 1.7% justifies Government’s spending on SSNP. • No concrete evidence that government’s spending on SSNP is being received by the poor and hence poverty is declining. • Large number of beneficiary HHs of major SSNPs are not poor at least in terms of official measures of poverty. • However, it is also not true that the benefits are being captured by the elites since most beneficiaries are from the lower income deciles. • False prioritization (high inclusion error) exists.

40. Recommendations • Social safety nets and their scope should be defined clearly • An extreme poor database should be prepared for easy and error-free selection of beneficiaries. The process could start with a piloting using the poverty map. • Geographic targeting of SSNPs should follow the poverty map and it should be revised at least every five years. • Targeting criteria of the existing SSNPs should be revised using practical and easily measurable indicators. • Implementation of SSNPs should be supervised strictly to reduce political and personal nepotism, bribery and improper prioritizations

41. Recommendations • Coordination among Departments implementing SSNPs should be strengthened • Regular survey/research on coverage, targeting and impact of SSNPs should carry out • Awareness in mass media on safety net programmes and their eligibility is essential • Tangible vision and clear instructions on effective targeting of social safety net should be in the forthcoming National Social Protection strategy.

42. Thank You

43. Backup Slides

44. HIES (2010) and SSNP

45. HIES (2010) and SSNP

46. Status of poor HHS getting SSNP benefit (HIES 2010)

47. Performance assessment using programme specific variables Targeting Efficiency of Old Age Allowance

48. Performance assessment using programme specific variables Targeting Efficiency of Widow Allowance

49. Performance assessment using programme specific variables • Targeting Efficiency of Targeting Efficiency of General Relief Activities

50. Performance assessment using programme specific variables • Targeting Efficiency of Vulnerable Group Feeding (VGF)