After Poverty Reduction.

The new international thinking on social protection Francine Mestrum, PhD Professor at the University of Ghent, lecturer Université Libre de Bruxelles

For T.H. Marshall the twentieth century was the century of social rights. After the emergence of civil rights in the 18th century and the more or less generalisation of political rights in the nineteenth century, the consciousness was slowly growing that equal rights were not really helpful if economic inequality led to unbridgeable differences and the impossibility to exercise these rights. Marshall’s theory was strongly criticized, amongst others by feminists who noted that women got social rights before they got political rights. Nevertheless, the theory still stands as a basis for the development of welfare states. At the end of the twentieth century however, a new social paradigm was put into place. Everywhere, welfare states were under pressure. After fifteen years of ‘structural adjustments’ in most third world countries, imposed by the IMF (International Monetary Fund) and the WB (World Bank), a new policy of ‘poverty reduction’ was being proposed. This clearly was not seen as added-on the existing social protection, but rather as a substitute for it. The focus was put on extreme poverty and it rarely was put in relation with the social and economic rights that are enshrined in an international treaty. Even if all UN (United Nations) documents refer to the universal and indivisible human rights, neither the Millennium Development Goals nor the ‘Poverty Reduction Strategies’ refer to these rights. These developments lead to four considerations. First of all, according to WB statistics, global extreme poverty is declining. In 1981 40,14 % of the population in developing countries lived in extreme poverty. In 2004 it is only 18,09 %. Poverty declined from 66,96 % in 1981 to 47,55 % of the population in poor countries in 2004. However, the number of poor people has risen from 2452,47 million in 1981 to 2547,94 in 2004. This positive result needs to be handled cautiously, since most numbers are merely estimates. Many poor countries have no data or no trend data . All statistics are based on a controversial ‘PPP conversion rate’ . In 2007 the WB stated that it had been overestimating the Chinese economy with about 40 % and the Indian economy with about 25 %. According to the WB, this means China has at least 65 million more poor people. Others think it may be 200 to 400 million more. In the meantime, global income inequality is rising. These statistics are also controversial and are very often ideologically influenced. Absolute inequality between countries certainly has risen, whereas relative inequality seems to decline . The weighted inequality between countries has been declining the past twenty years, though without taking into account China and India, it has also been rising. Declining poverty, then, is not incompatible with rising inequality. Thirdly, the poverty reduction strategies of the WB and the IMF did not mean that other macro-economic policies were being introduced. The poverty strategies of the Bretton Wood institutions are compatible with the policies they have now been imposing on poor countries for almost thirty years. A growing consensus admits the importance of budgetary discipline and the fight against inflation, but privatizations, deregulations and free trade remain controversial and are still among the conditions that poor countries must accept in order to get development financing. Some of the evaluation reports of the IMF also state that its discourse has changed more than its practice.

Finally, the Millennium Development Goals should halve extreme poverty by 2015. There are doubts on the feasibility of these goals, for some because of a lack of political will, for others because of a lack of resources or the incoherence of policies. Whatever the reasons, another interpretation of the goals is now being proposed as well as a broader definition of development assistance. Rich countries have repeatedly promised to give 0,7 % of GDP to development, ‘as soon as possible’. Today, the gap is still very large and this may explain the need for new elements to be counted as ‘development aid’, such as migrants’ remittances. Growing discontent After the turn of the century a growing discontent about the lack of tangible results of the policies in and towards poor countries began to emerge. Since 2005, there surely is considerable growth in Africa, though mainly in commodity exporting countries. In 20 African countries growth was not higher than 2 % for the past ten years. More and more questions are raised concerning free trade policies, notably with the proposed ‘Economic Partnership Agreements’ of the European Union. In 1986, Unicef was the first international organization to criticize the ‘structural adjustment’ policies and to ask ‘adjustment with a human face’. Twenty years later, one has to admit that the human face of poverty reduction only exists on paper. The nineties were characterized by different financial crises (Mexico, Russia, South-East Asia, Argentine) and at this moment of time industrialized countries anxiously await the consequences of the banking crisis in the United States. At the international level, ECLAC (UN Economic Commission for Latin America) was the first organization to publish alternative policy proposals. UNCTAD (UN Conference on Trade and Development) notes the ‘poverty trap’ of the global trade system for the poorest countries. The UNDP worryingly took note of the result of a continent wide opinion poll in Latin America: a majority of the people said to be disappointed in the democratization processes because they lacked social and economic improvements. The election of several leftwing governments explains this growing dissatisfaction. UNRISD (UN Research Institute for Social Development) started a research program about ‘social policy for development’. Under the chairmanship of James Wolfensohn the WB created the impression of also wanting to change its policies, but apparently the links with the IMF are too strong. Only at the level of discourse is there a –superficial – change, practice remains unchanged. The WB explains the lack of successes with the lack of ‘good governance’ in poor countries. However, by changing the agenda for economic and social development into a programme for free trade and poverty reduction, one has to fear that the ambitions of rich countries’ development policies have been receding. The problems of rich countries It has repeatedly been stated that rich countries with a high level of social protection are also the countries with the highest competitiveness in global markets. Nevertheless, welfare states are under pressure. Benefits are now said to create an unacceptable degree of dependence and jobless people are being ‘activated’. The democratic ex-president of the United States, B. Clinton, is proud of having ended the welfare state in the US. In the United Kingdom Thatcher harshly attacked the trade unions. In the European Union, policies formally changed with the Maastricht Treaty of 1992 aimed at completing the internal market with a European currency and a European Central Bank. The European welfare states have always been criticized. In the 1960s a ‘new poverty’ was being discovered and one had to admit that social security was far less universal than it had been claimed. A first serious charge against social

security was brought by Titmuss, who focused on the role of public authorities. Neoliberal criticism was based on the philosophical thinking of von Hayek and later on the popular book of Murray, ‘Losing Ground’ that strongly influenced opinions in the United States. The only social responsibility of states is towards extremely poor people, so it was said. Redistribution of incomes inevitably is arbitrary and gives the wrong incentives. The austerity programmes of the member States of the European Union were a direct consequence of the ‘convergence criteria’ they had to respect in order to adhere to the European currency. In the same way as with structural adjustment programmes, they ask for fiscal discipline, fighting inflation and reducing debt. With the Lisbon agenda of 2000 the ‘activation’ policies of jobless workers were formally introduced. Public services are now being liberalized and sometimes privatized. The European Union has no explicit competences for social security policies for which the national states remain responsible. However, ministers of finance do adopt guiding principles on pensions, health care and education from a purely fiscal point of view. In the same way as for poverty reduction policies member states engage – with more or less enthusiasm – in an open method of coordination in order to learn from each other and exchange ‘good practices’. According to the Lisbon agenda, the European Commission makes proposals for the modernization of labor law and ‘flexicurity’. It would clearly be wrong to assess these changes from a purely ideological point of view. The economic and societal changes of the past fifty years do cause real problems for social security systems: the ageing population, the massive arrival of women on the labor market, high unemployment, the greater mobility of workers, globalization. In Western Europe the existing social protection has been rather resilient, thanks, inter alia, to the presence of strong trade unions. The falling purchasing power of the recent period – real or virtual – does create problems however, especially in the light of the growing wealth of some. The privatization of public services meets strong resistance. It is now clear that in all Western European countries social protection has become a hot topic and alternatives for the policies of the past twenty years are slowly getting on the political agendas. The rejection of the draft constitutional treaty of the European Union in France and Holland, and the ‘no’ vote in Ireland against the Lisbon treaty show that there is a lot of fear and mistrust. This is the background against which all new proposals for a modernized social protection have to be assessed. In this contribution I propose to look at the international alternatives, mainly addressed at third world countries. This analysis is not based on research into the ongoing changes, since in most countries dismantling of social policies is still going on. It does look at the emerging discourse on the necessary changes that are now being discussed. This discourse analysis is important in order to understand the underlying philosophy of the proposals and to grasp the direction of proposed reforms. Identical factual changes can indeed be related to incompatible philosophies and do not always shed light on the global context of reforms. Changes are introduced as a kind of piecemeal engineering which makes it difficult to see the wood for the trees. Knowing the underlying philosophy of a reform makes it easier to assess its separate elements. Secondly, a discourse analysis also allows for revealing the potential of possible resistance to each proposal. Each reform will have to contain some promises in order to make it acceptable. These promises are the elements that can possibly be used in order to demand adjustments. Discourses are not only sites of power, but also sites of resistance. Reforms that are needed because of economic and societal changes can be based on divergent ideological stances.

The benchmark for the analysis of the new proposals will be the existing theories on social security and social protection. These theories are not chosen because of the ‘ideal’ image they create, but because they constitute the only framework in which to consider the ‘welfare states’. The question on the desirability or not of the proposed changes of these welfare states is not answered here. The only aim of the analysis is to map out the proposed reforms and to check them with the existing theories. Diverging global initiatives The analysis concerns different international proposals. The first one is from the OECD (Organisation for Economic Cooperation and Development). It published in 2000 a ‘New social Agenda’ that, in principle, was addressed at its (rich) member states though it can be seen as a basic document for the new thinking on social protection. The second document is from the World Bank that, equally in 2000, published a ‘theoretical framework’ on social protection in developing countries. The third document is also from the World Bank and is a formal proposal for a sector strategy of the Bank. The fourth document is from the UNDP, a particularly interesting one because the UNDP was explicitly against social security in its first reports on human development and on human poverty. The fifth document comes from ECLAC and is the result of its earlier proposals of 1992 to establish new principles for social protection. The following UN document is equally very interesting because it explicitly refers to ‘national’ strategies poor countries need to have. Finally, I want to analyse some documents of UNRISD, more particularly some texts that have been published on Africa, Latin America and South-East-Asia. These are not concrete proposals but forward looking analyses. With the exception of the first and the third document, these texts are not official points of view of the institutions that published them. They were written by their research departments of by external experts. But because of their publication by these official organizations, they acquire a moral authority and become automatically the subject of the international debate on social protection. In this way, they do have a certain influence. The questions that will be put to the documents concern in the very first instance the explicit aim of the proposed reforms. What is it one wants to bring about? Why are these proposals being made? The final question will concern their potential as regards the limited poverty agenda of today: can they go beyond poverty reduction? Can they tackle inequality? Are they really innovating? The questions in between are based on the major theoretical characteristics of the welfare states that were developed in mainly Western Europe. This Western social model did indeed serve as the basis for the welfare states in Latin America and Africa. In some Latin American states they were nearly as developed as in Europe . In Africa, they only existed in an embryonic form but their basic principles and their aims were identical. In Asia other principles were prevalent and consequently, the Asian continent will be less present in this analysis. The requirements of social protection are nearly identical everywhere, but the underlying philosophy and the modalities of procuring protection can be different. Six major blocks of questions will be analysed. The first block concerns the explicit aim of social protection. In Europe this was in the first place to guarantee incomes, even if political stability was mentioned as well. Keynes often referred to the necessary efficiency of economic systems and the usefulness of social protection in this respect. Redistribution of incomes can also be an objective, even if it is the insurance logic that prevails in Europe. Social security can help to develop ‘human capital’ and to promote economic growth. It

can also be an instrument in the prevention of and the fight against poverty and it can help to bring about a more ‘holistic’ development. This means that development is economically, socially and politically sustainable. Finally, one should not forget that the social protection in Europe was also meant to bring about national and social integration and thus contribute to nation-building. The second block of questions concerns the citizenship model of T.H. Marshall. Citizenship is based on equality and equivalence and thus on equal civil, political and social rights. As was mentioned, these rights are rarely touched on in poverty reduction strategies. Another characteristic of social protection based on citizenship is its universality. In Western Europe this was never really achieved, though it was an explicit aim. In poverty reduction however, it is explicitly rejected and policies are ‘targeted’ to the poorest. In a third block of questions, I want to address the specific components of social security. In Western Europe these are sickness insurance, pensions, insurance against labor accidents, family allowances and unemployment benefits. Apart from these basic elements, one clearly also has to look at social assistance and help for the poor and at ‘public services’, like education, health care, postal services, public transport, child care, housing, etc. These services are very often – directly or indirectly – ‘decommodified’ in order to give everyone access to them, independent of the economic position of citizens. In a fourth block the question of who organizes and who pays for social protection will be analyzed. This is currently of the highest importance, since privatization of social security is often being asked for. The organization and the funding of social security systems do tell us something on the level of solidarity a society is willing to show, independent of whether the funding is by taxes or by contributions. In a fifth block of questions I want to check whether the social protection proposals are meant for individuals, for families or for communities. Here, the gender dimension is clearly the most important factor. In a final block of queries I suggest to check the international dimension. We live in a period of globalization and it is perfectly normal to think also of a social globalization. International solidarity is now taking the form of development cooperation. However, the arbitrariness and the lack of efficiency of the system are problematic. This explains why voices are being heard to demand a global system of redistributive justice and a global social protection to be financed by the global level. The reasons why new proposals for social protection are being made The OECD notes that two almost incompatible needs do have to be reconciled: the need to limit social expenditures and the need to avoid social exclusion. It also points to some important social changes such as the ageing population, the growth of single parent families, low wages for unskilled people, etc. (OECD, 13). Today, social expenditures do not go primarily to the poorest (OECD, 85). Fiscal concerns are also very important for the WB (WB1, 2, 3, 9). It refers repeatedly to the problems of traditional social protection (WB1, 3, 9; WB2, vii, 2, 7) and the need to take into account the ‘reality of the 21st century’ (WB2, 1, 7). It states that sound macroeconomic policies are not enough for poverty reduction. The UNDP presents its proposals in the context of global social justice (UNDP, 2). It also refers to its proposals for ‘economic security’ and the general framework of human rights (UNDP, 29-31). Solidarity is a major value and reference is made to the Marshall Plan and the solidarity mechanisms of the European Union (UNDP, 19). The ILO speaks mainly of the social changes and the globalization. There is a need

to find a better balance between economic objectives and social protection (ILO, 16). The current development model is unsustainable, because traditional social protection is considered to be incompatible with economic growth (ILO, 16). Social protection is now at a crossroads and one has to find new instruments in order to better meet human needs (ILO, 28). ECLAC also points to the need of finding a synergy between economic growth and social justice (ECLAC, 11). It continues therefore to promote structural changes, even in the production processes. There is a need for a new social pact that meets basic human needs and expresses the willingness to build a cohesive society (ECLAC, 15). The UN thinks of stable societies and the reconciliation of human and economic development (UN, 6, 7). Social policies should not be residual policies. In the regional studies of UNRISD there are few references to the aims of reforming social protection, though the research project mentions explicitly the promotion of universal social protection and a way to make social protection play a positive role in economic development. For South-East Asia, it is mentioned that important changes were introduced in Taiwan and South-Korea after the financial crisis of 1997-98. About Africa, it is said that the State lost much of its legitimacy with the structural adjustment programmes. In Latin America, neoliberal policies are explicitly delegitimized (UNRISD2, 67). Another interesting feature is the mentioning of the need of new ‘developmental’ states. This brief review show two major aims for the reforms of social protection: budget restraints, mainly in the documents of OECD and the WB and the search for a (new) link with economic policies. This could possibly lead to a Keynesian come-back, since Keynes wanted to promote economic growth through the strengthening of people’s purchase power. ECLAC want a new social pact, a return to the system of the past but with corrections. What is the aim of social protection? Families who need social assistance do in fact ask for monetary assistance in the very first place (OECD, 112), though the fundamental reasons of their difficulties should be tackled first. People should not depend on social assistance. For the WB income is a stochastic element (WB1, 7) and poor countries simply cannot bridge the poverty gap with cash transfers (WB1, 2; WB2, 9). Old people can possibly receive a limited cash benefit, though the WB stresses the negative impact of cash transfers on individuals. They are seen as disincentives for taking risks and escaping poverty (WB1, 28). However, according to the UNDP, without cash transfers, poor people are simply not able to take the opportunities they are offered (UNDP, 3). Examples are given of successful programmes of cash transfers, which is also done by the UN (UN, 58). Basic social security is not expensive and in most poor countries, even in Africa, this would be perfectly feasible (UNDP, 21, 24). The ILO from its part stresses the need for new systems to protect against risks and states that unemployment benefits – where they exist – are more and more coupled to training programmes in order to help people to find new jobs (ILO, 26). Contrary to the poverty reduction programmes of the WB in the first part of the 1990s, cash transfers are no longer explicitly refused, though the WB and the OECD remain reticent. There are many positive examples of poor countries with cash transfers to the poor and the pensioners. However, income guarantees as they were once promoted in Europe are never mentioned. Economic efficiency is an important topic in almost all documents, not only as the aim of reforms but also of social protection itself. It can have a positive impact on economic growth, notes the WB (WB1, 2). Its social protection is framed in a larger programme of risk management needed for growth and for development (WB1, 8). Again, it is stressed that people should be encouraged to take risks (WB1,

27). The ILO does the same and notes that sound macro-economic policies and social protection are mutually reinforcing (ILO, 17). ECLAC sees a virtuous circle that is made by social justice and growth, the two faces of development (ECLAC, 32, 38). The ideological resistance against welfare is wrong, according to the UNDP, since social transfers can promote welfare as well as growth (UNDP, 29). It cannot be excluded that these arguments are somewhat expedient. Economic growth is the only aim left for development, so it is important to stress that social policies should not endanger it. It is an important argument because the European example shows that growth and protection are far from incompatible. Social protection is difficult to refuse if it enhances growth. An equally important argument concerns political stability, especially in a context with more and more fragile and failing states. Conflicts arise in countries where this was previously thought to be impossible. The frightening opinion poll of UNDP in Latin America revealing that a majority of the population was disappointed in the democratization processes and attached more importance to social and economic welfare, is probably one of the reasons why ECLAC and UNDP give so much importance to citizenship. It is stressed that social citizenship is an important element for the legitimization of political regimes (ECLAC, 22). It is another virtuous circle (ECLAC, 32). In Africa, social protection was considered to be an instrument to promote political stability and social cohesion after independence (UNRISD3, 9, 15). The education system was built in such a way that trans-ethnic elites could come about in order to support stability. However, the structural adjustment programmes have undermined state legitimacy (UNRISD3, 40). Social protection can also help to make reforms acceptable, according to the ILO (ILO, 17). If people know they are protected, they can easily take risks. Without social protection, it is the legitimacy of the reforming state that is threatened (ILO, 25). The WB states that social integration is one of its objectives but that its level will always depend on political choices (WB1, 25). This issue is relatively new in discourses on social protection. It never was used in documents on poverty reduction, where the focus was put on moral issues and globalization. National states only reappeared in the second half of the 1990s in order to regulate markets. Now a further step is made in order to stress the importance of stable regimes and cohesive societies. This is probably a consequence of the numerous internal conflicts in poor countries. Income redistribution was one of the aims of Western European social protection, even if the insurance logic was the first priority. But it is striking that this was never mentioned in the poverty discourses and that in fact it fully disappeared in all documents. Income inequality has only recently been rediscovered as being a political problem. The most important instrument for income redistribution is the tax system, as the OECD rightly notes (OECD, 77). The redistribution of the current social protection system is mainly beneficial to older people and detrimental to young families that have more and more problems. But the existing social protection is fundamentally a redistributive system, states the ILO (ILO, 22). Redistribution is critically important in order to fight poverty and to achieve sustainable development (UN, 9). For the WB income redistribution is not an objective of social protection, even if it can be one of its consequences (WB2, 7). One must go beyond passive income redistribution (WB2, 7). The WB prefers to give equal opportunities instead of

equal results: the latter is morally high standing but just not feasible (WB1, 7). In its documents, it speaks systematically of ‘equity’ instead of ‘equality’. For ECLAC income redistribution is closely related to social citizenship and more social equality. It is coterminous with a better social protection (ECLAC, 18, 25, 41). Labor and the labor market are central in many of the European systems, especially in the Bismarck model where social security is financed with contributions of workers and employers. The objective was to achieve a universal system. However, the failing of this universalism with high long term unemployment and the difficulty to integrate some people into the labor market was one of the reasons to reform social protection. The OECD uses a European concept and speaks of the employability of people that has to be improved (OECD, 101). ‘Exclusion’ is in the very first place exclusion from the labour market. People have to be encourage to participate and to work longer, which is difficult to reconcile with cash benefits in view of poverty and unemployment traps (OECD, 102, 139, 167). The OECD sees less problems with subsidizing labour than with benefits (OECD, 108, 165). Labor is one of the instruments that can be used to help poor people in the strategy of the WB (WB1, 20). In all circumstances, people have to be encouraged to remain active. If there are no benefits, they have no other choice. The ILO refers repeatedly to its ‘decent work’ programme , which the WB also does (WB2, x). However, it is known that the WB does have difficulties in accepting some of the ILO’s core labor standards , especially union rights. For the UN, decent work is a central element and the focus is also put on the still large informal sector (UN, 37). Labor market policies are needed that respect the ILO core labor standards (UN, 40-41). The WB, OECD and the ILO see poverty prevention and reduction as an important objective of all social protection. Traditional social protection does not do it, according to the WB, and therefore a programme for risk management was necessary (WB1, 2). If poor people are not helped in order to cope with risks, they will have to take their children from school and to permanently damage their human capital (WB1, 10). The ILO also points to the danger of irreparable damage to human capital if there is no social protection ( ILO, 17). Social protection is not a price to be paid but an investment to be made. Finally, social protection can help to achieve a more holistic development (ILO, 28). Citizenship and universality The WB and OECD have little to say on citizenship and human rights. They easily talk about clients and consumers. The OECD says a right balance between rights and duties has to be respected (OECD, 163). The WB refers to the core standards of the ILO but also to the interesting possibility of private and market standards (WB2, x, 29). A trade-off with market concerns always has to be made. The UNDP points to the fact that the effective implementation of rights can be restrained by lack of resources and thus choices may have to be made (UNDP, 23). However, this cannot be the case for the fundamental basic rules of social protection that have to apply to all and that can be considered as being an investment (UNDP, 28).

The ILO repeatedly refers to the Universal Declaration of Human Rights and to the International Covenant of economic, social and cultural rights. This implies a duty to solidarity (ILO, 18). As was mentioned earlier, ECLAC calls for a new social pact including the economic, social and cultural rights, even if budgetary limits may constrain its full implementation (ECLAC, 12). Full-fledged citizenship strengthens democracy and is the basis for a more inclusive society (ECLAC, 12). It is not incompatible with economic growth (ECLAC, 22). Social and political citizenship interact and none can be seen as prior or secondary to the other (ECLAC, 17). Social protection is not only a right, it is evidence that one belongs to a community (ECLAC, 18). The UN also points to the fact that a social pact between governments and citizens may be needed to confirm all rights that are in the common interest (UN, 6). These perspectives on citizenship and rights determine the position on the universality of social protection. Again, the same matrix appears: the WB and the OECD are reticent. Universality endangers redistribution, according to the OECD (OECD, 83), whereas the WB prefers more targeted interventions (WB2, 33). The ILO admits that universality is not easy to achieve, but it does stress that social protection should cover the formal and the informal sector. Social protection for limited groups is not useful (ILO, 8, 29, 30, 31). ECLAC is in favour of universality but does not exclude that targeted interventions are organized within that framework. They are not mutually exclusive (ECLAC, 5). Social rights are universal and it is therefore not possible to only target the poor. It would be contrary to the principle of social citizenship (ECLAC, 20, 36). The UN has good reasons to be in favor of universality, but states that the programmes of the past have not achieved it (UN, 34, 32). However, targeting is very difficult and one should try to combine it with a universal approach. UNRISD is very much in favor of stopping the targeted programmes in Africa and to introduce universal policies (UNRISD3, 43). Which social services? The analysed documents do not say much about the social services that would have to be offered, nor do they say much on public services. The concept is rarely used by the different organizations. Apart from a reference to ‘health and security at the workplace’ by the ILO (ILO, 47), no mention is made of any insurance against labour accidents, the oldest component of social security in Europe. Unemployment benefits also have very limited attention. According to the WB, it is not the best instrument to cope with the risk of unemployment (WB1, 31; WB2, 32). It states that alternatives should be examined with the ILO (WB2, x). In Taiwan, an ‘Employment Insurance Programme’ was introduced after the financial crisis of 1997-98, and UNRISD is in favor of helping unemployed people (UNRISD1, 3). But most documents stress that the creation of new jobs and the training of young people are the best mechanisms.

Child care and family allowances also receive very little attention. The WB mainly talks about jobs for women, about the problems of lone parents and the necessary child care this entails. Different countries do have programmes to help mothers and children with cash benefits conditioned by school attendance and/or medical check-ups. Pensions receive more attention from the institutions. The OECD (OECD, 167) and the WB (WB1, 20; WB2, 7) stress the importance of urgent and necessary reforms. UNDP (UNDP, 16) notes that more and more countries have non-contributive pension systems, a system ECLAC equally prefers (ECLAC, 114). The capitalization systems in Latin America undermined solidarity and strengthened the already very high inequality (ECLAC, 130). Workers should have more possibilities to pay contributions and a dual system based on taxes and contributions can help to enhance solidarity. The UN notes that from the point of view of social justice, a public pension system should be preferred. If higher income groups want to receive more, they can pay for it themselves (UN, 54). Sickness insurance and health care are also focused on. The OECD is concerned about the rising costs of the system (OECD, 117) and the WB speaks of insurances offered by public authorities or by the private sector. According to the ILO, sickness is one of the risks people are exposed to and hence they need protection. The UNDP points out that more and more countries do introduce some kind of insurance. Social justice is only possible, according to the ILO, if all people have equal access to basic social and economic security. It means income security, health care, primary education and lifelong learning, care for the older people and in poor countries food, shelter and clothing as well (ILO, 33-34). ECLAC sees health care as a central component of economic and social rights. It may be difficult to finance and therefore three different sectors can be involved: public authorities, the private sector and ‘social security’ . Some basic benefits should be enforceable rights and all should have access to health care (ECLAC, 77, 78, 88, 98). Without support of public authorities, no decent health care is possible, states the UN. Systems with fees and cost recovery have had very negative consequences in many countries, since they limited the access to health care systems. The public sector must play an important role, with maybe a contribution from the private sector. Access to health care must necessarily be universal (UN, 50, 51). Education is considered to be a basic right, almost everywhere, though the documents attach more importance to primary education and vocational training. Other public services are not discussed. Even if the universality of education and of health care are often preferred and if the public sector is going to play a more prominent role, it is not sure this will lead to decommodification, that is the withdrawal of these services from the market. In all documents the private sector plays an important role, which means that free access will only be for the poor. Most organizations, then, seem to prefer dual systems. Who organizes and who pays? Pure market mechanisms cannot function well in the health sector, according to the OECD (OECD, 118). The public sector does have to play a role, as well as nongovernmental organizations (OECD, 143). Traditionally, the public sector has been too predominant, ignoring the responsibility of the market, communities and even individuals, according to the WB. It wants to promote a ‘community-driven’

development, and also wants to support the informal sector and the market to deliver services (WB2, iii). The whole system of social protection must be rights-based, states the ILO, though a clear relationship should be made visible between contributions and taxes, on the one hand, and the benefits one can claim, on the other hand (ILO, 24, 54). This rights-based approach automatically gives an important role to the public authorities (ILO, 30). Rights have to be made enforceable, thinks ECLAC (ECLAC, 14). The commodification of social services has worsened inequality, according to the UN, though it also states that all systems have their advantages and their inconveniences (UN, 24). It is clear that in the case of natural monopolies or quasi monopolies the state has an important role to play (UN, 26). It is possible that taxes will have to be raised in order to fund social services (ECLAC, 76). UNRISD wants to promote a universal, just and qualitatively high-standing system of social protection. It wants governments to define development policies and to make alliances with the private sector (UNRISD2, 21, 68). It is possible that the tax systems will have to be adjusted, ‘and it would be nice if transnational corporations in Latin America pay their taxes’ (UNRISD2, 69). Who are the beneficiaries? The main focus of all organizations is put on the family, even if individuals also play an important role, particularly in the models defending citizenship. Families continue to be considered as fundamental institutions for risk management, according to the WB (WB1, 26). Marriage is one of the elements mentioned as informal insurance mechanism (WB1, 20). The World Bank also thinks positively about ‘community development (WB2, 22) and ‘community-based insurance (WB2, 37). Different organizations point to the specific role women have to play, though they are not mentioned as a special target group, contrary to the discourse on poverty reduction. The international dimension The OECD and the WB do stress the importance of globalization but they never mention any kind of international social protection. The ILO refers to its legislative work, while the UNDP and the UN explicitly demand international solidarity. The UNDP pleads for large transfers from rich countries to poorer ones, as happened with the Marshall Plan and the European Union (UNDP, 2). This is the price we have to pay for global, human security (UNDP, 29). Global social justice demands more international cooperation (UNDP, 32). The UN also pleads for international redistribution and social justice and talks about ‘Global Public Goods’. Most interestingly, reference is made to the new mechanisms for development aid, more particularly budget support that can become an excellent instrument for global redistribution (UN, 64). Beyond Poverty Reduction? It is clear that the new social protection will be very different from the formerly existing one, if ever this discourse is put into practice. All analysed

documents from different international institutions give a role to the private sector. What it reveals is that even the organizations that defend a universal system, citizenship and human rights do in fact speak about the poor. They are the ones who need those human rights with basic services. The non-poor can easily buy whatever they need on the market. What is asked for, or so it seems, is a universal funding for what may become, in fact, a dual system. So yes, international organizations do go beyond poverty reduction, but in different ways and with some remaining doubts on the universality of the systems they propose. Conclusions The different proposals do present some commonalities. Does it also mean a new global consensus is in the making? Inequality is now back on the agenda, in a very limited way for OECD and WB, very explicitly for the other institutions. This may be the beginning of a new social policy. In all cases social protection is considered to be a kind of ‘life cycle’ system, with different mechanisms according to the risks that arise. Risk is a central phenomenon and their occurrence is said to be avoided. The WB goes a long way in this direction, but stops short of also proposing remedies when risks do occur. Maybe this is the most important change when one compares the new proposals with the existing social protection. It is clear that a combination of preventive and remedying instruments could lead to the best possible protection. If there is no income security and no unemployment benefits, people are apt to become poor when they lose their jobs, whereas the door has been opened to give them individual responsibility for all misfortunes. Another commonality is the role for public and for private sectors. The WB is most reticent towards the Western European systems based on contributions, but it does not say explicitly to oppose them. All organizations think of an insurance system and an assistance scheme and no one excludes the privatization of some parts of them. The differences concern the role of public authorities, citizenship, universality and the redistribution it entails. At this point there is a clear dividing line between the OECD and the WB, on the one hand, and the UN, UNDP, UNRISD and ECLAC on the other hand. The ILO has a middle position. For the OECD and the WB the focus is clearly put on budgetary discipline and the preservation of growth, supposed to be difficult to combine with social protection. For the other organisations, the economic dimension is not absent but a synergy is wanted. Implicitly, reference is made to a Keynesian model where the economic and social dimensions interact and mutually reinforce each other. It is probably right to conclude that the OECD and the WB do not dismiss the ‘Washington Consensus’ and only give public authorities a minor role in social protection, without income redistribution. They do know better than twenty years ago, however, that social protection is needed, beyond poverty reduction. The other organizations and most particularly the UN, do dismiss the neoliberal model and give responsibility for social protection and income redistribution to the state, even if it does not exclude that some parts of it may be subcontracted to the private sector.

A social protection that is based on citizenship and on a social pact, as ECLAC demands, is not a residual system but is the core of the link that binds people to each other and to their governments. In such a framework child care and even a minimal pension has a totally different meaning. They can be received, not because one is poor, but because one is a citizen with equal rights. These systems avoid the stigmatization and give positive incentives to exercise one’s basic human rights. This clearly is a political programme. Even if its scope can depend on economic growth, it is not subordinated to it. Citizenship, equality and human rights are the basis of a redistributive system than can be emancipatory. Individuals can have rights independent from their market position. The financial solidarity of the non-poor is called upon in the form of contributions or taxes. This is meant to promote social cohesion and integration and can help to legitimize political regimes. In the long run, it strengthens democracy. Twenty-five years ago, Rosanvallon stated that the problems of welfare states had little to do with their funding, but more with the way they were organized. Seen from that perspective, the major principle of citizenship does not have to be changed. It means there are rights for all, independent of who and how a service is offered, by the public or by the private sector. The main responsibility is in any case with the state. However, for the OECD and the WB, the financial problem does seem to be prevailing. This is the framework in which global solidarity has to be considered. Globalisation can indeed be a problem and an opportunity. The opportunity is that the world can be made one and that the global level not only has an economic but also a social dimension. A global social security is perfectly affordable, as the UNDP has shown (UNDP, 2). It can be looked at as a global public good that can globally and publicly be financed. This has nothing to do with charity or philanthropy, nor with the poverty reduction of the WB. But it does concern the definition of rights in a pact with national governments for guaranteeing these rights and for a global funding with money that now is given to ‘development cooperation’ and can also come from global taxes. A perfect democratic organization of such a system is perfectly feasible but has to be negotiated. It does demand a different perspective on development, development cooperation and globalization. Annex OCDE, Pour un monde solidaire. Le nouvel agenda social, Paris, OCDE, 1999. OESO Holzmann, R. & Jorgensen, S., Gestion du risque social : cadre théorique de la protection sociale, Document de travail n° 0006 sur la protection sociale, Banque mondiale, février 2000. WB1 World Bank Group, Social Protection Sector Strategy : From Safety Net to Springboard, Washington, The World Bank, 2001. WB2 Bonilla García, A. and Gruat, J.V., Social Protection. Social Justice, Geneva, ILO, 2003. ILO UNDP, New Thinking on Aid and Social Security, Human Development Report 2005, Occasional Paper, 2005/2. CEPAL, La protección social de cara al futuro, Santiago, CEPAL, 2006. Huck-ju Kwon, Transforming the developmental welfare-state in East-Asia, UNDP CEPAL

Geneva, UNRISD, 2005.


DRAIBE, S. and RIESCO, M., “Latin America: A New Developmental Welfare State in the Making?” in Riesco, M. (ed.), Latin America. A new developmental welfare state in the making?, Geneva, UNRISD, 2007. UNRISD2 Adésíná, J.O., “In Search of Inclusive Development: Introduction” in Adésíná, J.O. (ed.), Social Policy in sub-saharan African context, Geneva, UNRISD, 2007. UNRISD3 United Nations, National Development Strategies, Social Policy Note, UN

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