Number of recipients rises, many needy still out of net
The number of safety net beneficiaries increased 4.1 percentage points over the last six years but many needy persons still remain outside the scheme's purview, highlighting the need for better targeting.
Some 28.7 percent of the total population are enjoying the safety net programme benefits, according to the preliminary report on Household Income and Expenditure Survey (HIES) 2016 by the Bangladesh Bureau of Statistics.
About 35.7 percent of the total population in rural areas got the benefit and 10.9 percent in urban areas.
“Latest data shows that social protection programmes are covering the poorer areas better than it used to,” said Zahid Hussain, lead economist of the World Bank's Dhaka office.
However, a vast number of the poor still remain uncovered and the inclusion errors -- the addition of non-poor among the beneficiaries -- are significant.
As much as 52 percent of the total allocation for safety net schemes goes to three programmes for school students such as stipend and school feeding programme, where many non-poor are also benefitted.
On the other hand, old age allowance gets 14.22 percent of the safety net programme allocation and widowed, deserted and destitute women allowance get 4.2 percent.
Besides, there are many other programmes from which only the poor get benefits like maternity allowance programme for poor lactating mothers, which has less than 1 percent of the beneficiaries.
The sizes of the benefits are still inadequate relative to what is needed, Hussain said. “This is evident from the fact that the role of public transfers has been rather limited in poverty reduction seen since 2010,” he said, adding that a poverty database would help improve targeting.
Together with consolidation of many small programmes, this would help strengthen the role of social protection in poverty alleviation, both by increasing the coverage of the poor and the size of resource transfers made to each poor family.
A government survey report shows that the rich-poor inequality in terms of wealth accumulation has been widening in the country.
With a big sample size, HIES is the most exhaustive nationwide survey carried out by the BBS usually once in five years.
The HIES 2016 also captured income shares of the bottom half (on economic scale) of the population to show that they used to command 20.33 percent of the national income in 2010 but it has now fallen further to 19.24 percent.
In other words, the income of those on higher economic scale has increased over the past six years since the last HIES was conducted in 2010.
Particularly, the top 10 percent of the population (in terms of economic standing) now account for a higher share of the income in 2016 (38.16 percent) than they did in 2010 (35.84 percent).
On the contrary, the lower echelon's (the bottom 10 percent of the population) income share has halved in six years: 1.01 percent in 2016 against 2 percent in 2010.
The number of people living in poverty has dropped to 24.3 percent in 2016 from 31.5 percent in 2010, while the proportion of ultra-poor also fell to 12.9 percent from 17.6 percent in six years.
However, the rate of poverty reduction (1.2 percent a year) actually slowed down in 2010-16 from the preceding five years (1.7 percent a year).
AB Mirza Azizul Islam, former finance adviser to a caretaker government, and Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue, suggested expanding the social safety net programmes for the benefit of the poor and reducing inequality.
It is necessary to put in place a “distributive justice” so that everyone gets the benefits of the growth, Rahman said.
Merely expanding the safety net programmes is not enough; the beneficiaries of the safety net programmes have to be chosen carefully, said Akhter Ahmed, who leads the operation of Washington-based think-tank International Food Policy Research Institute. Among eight divisions, Barisal got the highest safety net allocation of 38 percent, followed by Rangpur division at 24.3 percent, according to HIES 2016. Khulna division received 22.9 percent and Rajshahi 20.1 percent.
This fiscal year, Tk 54,206 crore has been allocated for the safety net programmes, which is 2.44 percent of the country's gross domestic product. In fiscal 2009-10, the allocation was Tk 17,327 crore, which was 2.52 percent of the GDP, meaning the allocation did not increase much in comparison to the rise in GDP.