Social protection is a system or set of interventions designed to reduce the vulnerabilities and shocks experienced by citizens. It has become a globally accepted strategy for improving the socio-economic outcomes of the ultra-poor and vulnerable members of society. However, the 2020-2022 World Social Protection Report by the ILO notes that only 46.9% of the global population is socially protected; worse still, only 30% receive comprehensive social protection coverage. This varies greatly by region, with Africa having the lowest coverage at only 17%, while Europe and Central Asia have the highest at 83.9%. For Africa to overcome the challenge of achieving poverty reduction, inclusiveness and equity, there is a need to design and implement tax-financed and gendered social protection programmes.
The COVID-19 pandemic has helped reveal the depth of inequality in social protection coverage across African regions. In particular, Central, West, and East Africa fared poorly in protecting their citizens via cash and social transfers during the pandemic shocks. Women were especially affected, as the absence or reduction of social protection interventions due to the economic realities of the pandemic exposed them to greater unpaid work and gender-based violence. As a result, the poverty level among African women has increased, with an additional 13.3 million women becoming poor or poorer in the last 3 years of the COVID-19 pandemic.
This disparity in social protection coverage is particularly pronounced for women in the workforce. The International Trade Union Confederation (ITUC) notes that globally, only 26.4% of women in the formal labour force are covered by contributory old age protection. In Africa, there is a stark disparity between men and women in North Africa, where only 8% of women receive old age pensions compared to 63.6% of men. Sub-Saharan Africa fares better in this regard, with a gender gap of 3.4% in favour of men.
The factors that contribute to this disparity in social protection coverage for women include historical inequality in formal labour force participation, women’s unpaid care jobs, and their overrepresentation in formal employment. Additionally, women lack protection during pregnancy, childbearing, and childrearing. This lack of coverage has significant implications for inclusive economic growth and poverty reduction, as previous research has shown that contributory social protection, such as social insurance, has a more significant impact on reducing poverty and inequality. In other words, the absence of contributory social protection for women increases intergenerational poverty and vulnerability, as well as hinders economic growth. For Africa, it is essential to address these disparities and ensure that social protection interventions are designed to address the specific needs of women and other vulnerable groups. At any rate, for Africa to meet the targets it set for itself in the context of the global economic recovery agenda, it will have to address the economic challenges faced by women who make up a large proportion of the African population and want to contribute to this recovery.
Non-contributory social protection programmes such as social assistance and social care have seen deliberate attempts by policy designers and policymakers to incorporate a gender lens into programme design and implementation. This is evident in the selection of beneficiaries for social assistance programmes and the prioritization of female members of households as direct recipients of cash transfers on behalf of households. Despite these efforts to close gender gaps, gender disparities still exist in non-contributory social protection as women and girls are not adequately covered throughout their lifecycles. During acute and protracted settings such as the COVID-19 situation, the gender gap in social protection is even more pronounced. The fiscal space, which allows the financing and implementation of social protection programmes that target and protect women, has been further constrained due to COVID-19 shocks, leading to the discontinuity of such programmes. The question then becomes, what can Africa do about it?
Tax and the gendering of social protection
Financing models play a crucial role in determining the extent to which social protection programmes are gendered. Tax-financed social protection programmes have been found to be more impactful and longer-term than donor-funded programmes that are prevalent across Africa. For example, the Mongolian Child Money Programme (2005-2017), the South African Child Support Grant (1998-present), and the Brazilian Bolsa Familia (which began in 2003 and evolved into the current Auxilio Brasil) have shown to be sustainable and impactful. When tax is used to finance social protection programmes for redistributive and transformational purposes, social assistance transfers per person tend to be higher than donor-funded programmes. Domestically funded programmes are more institutionalized and larger in scale, providing greater opportunities to articulate, design, and implement social protection programmes through a gender lens. This enables greater consideration of socio-economically marginalized groups, including women.
Tax-financed social protection programmes also provide greater room for critical evaluation, learning, and feedback in the course of the programmes, leading to immediate adjustments. This proneness to adjustments allows for social protection policies and programmes to immediately address implicit gender pitfalls that may not have been identified in previous programmes or during programme formulation. Increased tax revenue also allows for greater fiscal space to pursue various social protection programmes that tackle different challenges faced by women and girls throughout their lifecycles. Taxation is also critical in delivering transformative social protection, which involves the redistribution of assets to reduce handout dependency and improve social services delivery for sustainable livelihoods and greater acceptance. Universal access to education, health, sustainable livelihood, energy, housing, public transport, and other social services can transform the lives of African women. Increased tax revenues and efficiently managed tax systems will increase fiscal space for social spending and infrastructure development in these areas.
Many African countries do not allocate enough tax revenue to social protection spending, with an average annual social assistance transfer per capita of only US$9. This observation coincides with the tax-to-GDP ratio of these countries. Countries such as Mauritius, South Africa, Seychelles, and Tunisia, whose social assistance transfer per poor citizen was US$36,442 as of 2018, have tax-to-GDP ratios ranging from 32.4% to 20.4%, which is closest to the OECD average of 34.3%. Many African countries are below the African average of 16.5% in terms of tax-to-GDP ratio, which limits the fiscal space for social protection spending.
Therefore, there is a critical need to prioritize efficiency in tax systems and effectiveness in tax collection to provide greater fiscal space to finance gender-mainstreamed social protection policies and programmes that will boost the economic outcome of the region. Africa has the means. But does it have the political will?