28 May 2013, New York, USA – The second part of the UNITAR NYO/ International Labour Organization (ILO) seminar series on Advancing Social Protection Floors took place at the Permanent Mission of Finland to the United Nations. This seminar focused on financing Social Protection floors.
H.E. Dr. Janne Taalas, Deputy Permanent Representative, Permanent Mission of Finland to the United Nations, Ms. Yvonne Lodico, Head of the UNITAR New York Office and Mr. Vinicius Pinheiro, Deputy Director of the ILO opened the workshop stressing that universal and equitable access to basic social protection and to education and health care is crucial for promoting empowerment of traditionally disadvantaged groups like women and old and disabled persons and for ensuring pro-poor growth.
Ms. Isabel Ortiz from the Global Justice Programme of the Initiative for Policy-Dialogue at Columbia University presented a set of options for creating fiscal space for social protection financing, which would allow also the poorest countries to make the necessary resources available for the establishment of social protection floors. Among these options are the re-allocation of public expenditures, e.g. from military expenditures to education and health care, the increase of tax revenues, lobbying for additional aid and transfers, fighting illicit financial flows and restructuring debt. Professor Olivier de Schutter, UN Special Rapporteur on the Right to Food, added to these options by presenting the concept of a Global Fund for Social Protection (GFSP). One crucial factor preventing States from adopting rights based social protection systems are the risks associated with the costs of fulfilling commitments to provide basic social safety nets. The GFSP presents a solution to this problem by establishing a mechanism guaranteeing the support of the international community to individual states in the case that they are unable to bear the costs of established social protection nets, e.g. due to natural disasters or sudden losses of revenues from export products.
In the afternoon session, Mr. Elliott Harris, Assistant Director of the Strategy, Policy and Review Department of the International Monetary Fund (IMF), gave an assessment of the presented options for financing SPF from the IMF perspective. He stressed that social protection systems are only effective, if they can be maintained on the long-term. Options for creating fiscal space like increased aid transfers or restructuring debts can provide additional financial resources on the short-term, but present no possibilities for further expansion of services. Therefore, financing of social protection floors should rather be based on domestic resources created through economic development. In this case, tools such as progressive taxation systems can provide sustainable financial resources for the provision of social services and thus guarantee that also the most vulnerable groups benefit from economic development.
Ms. Jean D’ Cunha, Global Advisor on Employment and Migration at UN Women, and Mr. Vinicius Pinheiro closed the workshop with a gender perspective on Social Protection Floors and insights on the effects of social protection on rural development. Ms. D’Cunha stressed the importance of designing social protection mechanisms in a way they contribute to the empowerment of women by replacing discriminatory practices and structures. Mr. Pinheiro further illustrated the positive effects Social Protection Floors (SPF) can help rural households to enhance their resilience to external shocks through increased investments in their human capital and additional financial resources, allowing them to adopt more profitable income-generating activities and overcome credit constraints.
Summarizing the overall message of the second seminar of the UNITAR/ILO Series on Social Protection Floors, Ms. Ortiz stated: “There is no just economic development without the establishment of basic social protection… Let us work towards creating a world wide political consensus on the need for social protection floors.”