Updated by Griet Cattaert on 24.03.2011
So far, the crisis has primarily shown the deep international economic linkages among countries, which provided the channels for spill over of negative effects. Notwithstanding, the urgent need for policy coordination especially with a view to the developing economies, the political bonds in crisis response have hitherto been less tight. Nevertheless, there have been some initiatives with respect to social protection also on global level, which will be briefly introduced in this section. They come from the UN, the ILO and the G20.
The ILO's answer to the debate was formulated during the 98th International Labour Conference. A committee had been set up to discuss impacts of and possible responses to the crisis of the ILO and its constituents. One of its thematic sessions focused on social protection, the inputs for this debate and the summary of findings can be found on the ILO Global Jobs Crisis Observatory.
Core agreements in the debate were that social security
- is a human right;
- effectively reduces poverty, insecurity and inequality;
- is an economic necessity to unlock the full economic productive potential of a country and hence an important investment in development;
- systems serve as anti-cyclical social and economic stabilizers in times of crisis;
- structures, where they exist, bring countries into a better position to cope with the social and economic fallout than countries, which have to indtroduce new ad hoc measures.
The debate also showed a growing consensus which supports policies that aim at universal access to some basic social guarantees (in the form of primary health care, basic form of income security) and there was a growing acceptance of the concept of a social protection floor – even if the definition seems to require further work. Examples from low and middle-income countries highlighted that the cost of elements of the social floor are not too high (e.g. universal pensions). But it was equally stressed that there is no "one size fits" all solution for all countries. Each country has to elaborate its priorities according to its needs. In any case, social protection policies in times of crisis and beyond need to be part and parcel of a comprehensive set of labour market, economic, education policies and need to be an explicit part of wider social risk management strategies that are stabilizing households and communities.
Following this debate – and many others in the Committee of the Whole on the Financial and Economic Crisis – the International Labour Conference adopted a Global Jobs Pact, the comprehensive answer of the ILO and its constituents to the economic and financial crisis. With regards to social protection in the crisis, the Pact advises countries to consider, where appropriate, the following:
- introducing cash transfer schemes for the poor to meet their immediate needs and to alleviate poverty;
- building adequate social protection for all, drawing on a basic social protection floor including: access to health care, income security for the elderly and persons with disabilities, child benefits and income security combined with public employment guarantee schemes for the unemployed and working poor;
- extending the duration and coverage of unemployment benefits (hand in hand with relevant measures to create adequate work incentives recognizing the current realities of national labour markets);
- ensuring that the long-term unemployed stay connected to the labour market through, for example, skills development for employability;
- providing minimum benefit guarantees in countries where pension or health funds may no longer be adequately funded to ensure workers are adequately protected and considering how to better protect workers' savings in future scheme design; and
- providing adequate coverage for temporary and non-regular workers.
The Pact calls upon all countries to help vulnerable groups most hard hit by the crisis through a combination of income support, skills development and enforcement of rights to equality and non-discrimination. Countries that have strong and efficiently run social protection systems are advised to reinforce existing social protection systems. For other countries, the priority is to meet urgent needs, while building the foundation for stronger and more effective systems. Finally, the Pact recognizes the need to urge the international community to provide development assistance, including budgetary support, to build up a basic social protection floor on a national basis.
The ILO Global Jobs Pact hence is not a funded initiative and needs to calls upon the international community to provide the necessary funds for the development of the social floor. The social floor is not only an ILO project, but supported by the whole UN family, as can be seen from the social floor initiative. [Top]
The group of twenty leading industrialised and emerging economies that are referred to as the G20, met in London with a focus on the financial and economic crisis in March 2009. Their "Global Plan for Recovery and Reform" according to the G20 has its heart the "needs and jobs of hard-working families, not just in developed countries but in emerging markets and the poorest countries of the world too; and must reflect the interests, not just of today’s population, but of future generations too." Most of their conclusions are concerned with the global financial architecture, which shall be reformed with a view to its stabilisation. At the same time more money has been pledged to the International Monetary Fund to make available more lending to countries in need quicker. With a view to social protection, at the World Bank the Rapid Social Response Fund (RSSF) has been set up. The actions and decisions taken by the G20 during their spring meeting in London, shall provide US$50 billion to "support social protection, boost trade and safeguard development in low income countries, as part of the significant increase in crisis support for these and other developing countries and emerging markets" through the RSSF.
Following the World Bank’s outline, the RSSF is designed to assist countries address urgent social needs stemming from the crisis, and to build capacities and institutions to respond better to future crises. Resources received through the RSSF may be used to provide crisis support to the poor and vulnerable populations such as
(i) access to basic social services emphasizing services for maternal/infant health and
nutrition, and school feeding programs;
(ii) scaling up targeted safety net programs, where adequate mechanisms exist, and
building future capacity otherwise; and
(iii) active and passive labour market policies to assist in the income support of the
unemployed, training, placement and similar employment initiatives.
Herein, the RSSF should support projects, which are part of negotiated national social protection and social service strategies where appropriate. Donor countries are encouraged to top up the fund’s resources. Unfortunately, till date no information on applicants and beneficiaries of the RSSF is available. Such data would ease an assessment on whether the originally pledged amount of US$50 billion (and whatever else has been pledged by individual donors) is sufficient to meet the financing needs.
The G20 will convene for another Summit in Pittsburgh in September 2009 and the financial and economic crisis will be high on their agenda again. For this meeting the ILO has prepared a Communication to G20 Leaders Protecting People, Promoting Jobs: From Crisis Response to Recovery and Sustainable Growth, which evaluates national crisis response with a view to employment.