| Africa |
| Burundi |
- To offset the impact of the crisis on the poor in 2009, the IMF-supported program accommodated approximately 1.5 percent of GDP of emergency spending on targeted social safety nets.
- In response to the food and fuel shock in 2011, the IMF’s Executive Board approved higher financing in the amount of 0.5 percent of GDP to mitigate the impact of the shock on the country’s public finances.
- The program also included higher spending on social safety net programs targeted at the most vulnerable groups, in the amount of 0.7 percent of GDP.
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| Kenya |
- As part of the IMF-supported program, the government has expanded targeted programs such as cash transfers to orphans and other vulnerable children (OVCs), as well as elderly and other vulnerable people. As a result, the proportion of eligible OVCs receiving cash transfers increased from 1 percent in 2007 to 15.6 percent in FY 2010/11. Over the same period, the number of eligible households with vulnerable persons receiving cash transfers increased from 200 to 33,000.
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| Mozambique |
- Under the IMF-supported program, the government revamped its social protection programs in 2011 and increased its budget allocation to social protection for 2012 by one third.
- Mozambique is piloting the UN’s “Social Protection Floor Initiative,” which started in 2011. Under this initiative, the IMF provided analysis of available fiscal space while the ILO and UNICEF offered technical expertise on social protection schemes.
- To leverage fiscal space in designing sustainable social protection schemes consistent with the 2011–14 poverty reduction strategy, the current IMF-program includes a quarterly indicative target floor on priority spending reflecting half of all spending.
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| Seychelles |
- The IMF-supported program, approved in late 2008, introduced a cash transfer scheme which aims to protect the most vulnerable segments of the population by replacing untargeted universal product subsidies.
- In 2012, the government plans to revert to means-tested cash transfers, which are expected to increase by about 0.4 percent of GDP.
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| Asia and Pacific |
| Mongolia |
- Despite significant budget cuts in other areas, social transfers were protected under the 2009 IMF-supported program and have increased during the past two years.
- In January 2012, the parliament passed a social transfer reform law introducing a targeted poverty benefit that will strengthen the social safety net and increase the resources available to protect the poorest segments of the population.
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| Solomon Islands |
- The IMF-supported program recognizes the need to scale up critical social spending on infrastructure, health, and education to achieve inclusive growth.
- The government remains committed to keep spending on health and education at no less than 32 percent of government-funded recurrent expenditure and to improve the quality of spending by strengthening public financial management and procurement.
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| Sri Lanka |
- The IMF-supported program focused on preventing a currency crisis that would have been catastrophic, especially for the poorest and most vulnerable segments of the population.
- The program aimed to ensure that the peace dividend generated resources to help the country’s most vulnerable groups, including population in the North and East (the areas worst affected by the civil war).
- Since the beginning of the program, non security-related spending has increased significantly, both in absolute terms and as a share of total government spending. Resources previously allocated to military spending have been redeployed towards reconstruction activities, including demining, basic infrastructure, and other activities essential to the reintegration of populations displaced by the civil war.
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| Europe |
| Belarus |
- In 2009, the government increased allowances for housing assistance for families with 3 or more children, noncash housing subsidies for low-income families, and unemployment assistance.
- The 2010 budget doubled targeted social assistance, as the government reformed this program to widen its scope and increase the average assistance for poor households. The government plans to improve effectiveness of targeted social assistance in view of restructuring and possible privatization of state-owned enterprises.
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| Bosnia and Herzegovina |
- The IMF-supported program aims to cushion the aftershocks of the global economic crisis and of the fiscal adjustment on vulnerable groups by avoiding cuts to pensions and reforming the social safety net.
- The rights-based benefits system is being overhauled with help from the World Bank to improve targeting and prevent abuses of eligibility criteria.
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| Greece |
- A rapid increase in social spending has been one of the main drivers behind the large deficits accumulated before the crisis. Since 2000, social security spending in Greece has increased by about 6 percent of GDP and has reached one of the highest levels in the EU. Cuts to social spending, including pensions, are therefore unavoidable.
- To minimize the impact on the most vulnerable groups, pension cuts will be borne mostly by the highest pension recipients and those receiving supplemental pensions. The government has also committed to reviewing other social benefit programs, which are unequally distributed and poorly targeted—for instance, 60 percent of all family benefits go to the 40 percent with the highest incomes.
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| Hungary |
- The IMF-supported program, which expired in October 2010, aimed at macroeconomic stabilization and helped protect the poor and low-income earners from the impact of the global crisis. Specifically, mortgage borrowers benefitted from currency stabilization, and a banking crisis was avoided.
- Despite the nominal freeze of the public sector wages, a top-up payment scheme contingent on real growth was introduced to preserve the purchasing power of low-income civil servants.
- Targeted support schemes were introduced to protect the poor from the abolition of selected universal transfers and subsidies (including housing and energy); disability benefits were increased for the poor disabled people.
- A support scheme was introduced to provide temporary relief on mortgage payments for unemployed people and families facing significant increases in payments (either due to income loss or increase in loan payments on foreign-exchange denominated loans).
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| Iceland |
- The 2010 and 2011 budgets—while entailing expenditure cuts in some areas—have added new programs to deal with specific issues (for example, youth unemployment and overly indebted households).
- Engagement with social partners and consensus building have facilitated agreements on key budget issues, including a framework for household debt workouts and the recently concluded tripartite stability pact, which entailed a substantial increase in social benefits.
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| Latvia |
- The government implemented a comprehensive strategy to improve the social safety net at an estimated cost of 0.5 percent of GDP in 2011.
- The guaranteed minimum income, allocated to families, has been increased by 8 percent for adults and by 22 percent for children. If the income of the family is below the subsistence level, the family gets a cash transfer equal to the difference between the sum of the subsistence levels and the actual family income.
- Health copayments have been abolished for poor people.
- Increased funds have been made available for emergency housing support for low-income households.
- The IMF has also encouraged the government to implement a public works program, financed by the European Social Fund, to give jobs to people who wanted to work but were unable to find employment.
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| Romania |
- Under the IMF-supported program, overall social assistance has increased by RON 9.8 billion (1.9 percent of GDP) in 2009 and RON 4.7 billion in 2010 (about 1 percent of GDP). Measures included limiting gas price increases and minimizing the impact of heating price increases on vulnerable households.
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| Ukraine |
- Under the IMF-supported program, the threshold for maximum utility costs as a percent of income for working families was lowered, starting in 2011, from 20 to 15 percent, and from 15 to 10 percent for pensioners. Amounts above this are covered by the state budget. This is expected to protect some 800,000 households (about 5 percent of all households).
- The government is undertaking a review of all existing social programs, in consultation with the World Bank, with a view to improve their targeting and effectiveness. This should help make more resources available to protect more poor families.
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| Latin America |
| Costa Rica |
- Under the IMF-supported program, the government used available fiscal space to increase spending on education, health and social protection.
- Social spending increased by over 3 percentage points of GDP in 2009 and 2010, despite a substantial decline in revenues.
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| Dominican Republic |
- The IMF-supported program made it possible to increase the conditional cash transfer program (Solidaridad) by an additional 70,000 families in 2009. This amounts to over 10 percent of the population living in conditions of extreme poverty, and it has increased the coverage of the program to about 85 percent of the poor.
- There has also been an increase in the coverage of poor families under the targeted electricity subsidy program (known as Bonoluz), from 50,000 in December 2010 to 250,000 by end-2011.The government also plans a further extension of the conditional cash transfer program by 60,000 additional families to total of 590,000.
- The government is committed to increase social spending (mostly on education and health) by 0.75 percent of GDP a year during 2010–12 (something that has proven a challenge in 2010 and 2011 because of the fiscal consequences of the oil shock).
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| El Salvador |
- Under the IMF-supported program, subsidies (transportation, water, electricity, and liquefied propane gas) have been targeted to low-income households, with savings (amounting to 0.4 percent of GDP) used to broaden health services in low-income areas, provide uniforms and meals to school children, and expand conditional cash transfers.
- To strengthen the social safety net, the minimum pension has been raised to the same level as the minimum wage.
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| Guatemala |
- Social spending increased from 4.4 percent of GDP in 2008 to 5.7 percent in 2010 under the IMF-supported program.
- The government’s social protection policy focused on enhancing existing programs to offset the effect of the global and economic crisis on the poorest segments of the population.
- A key conditional cash transfer program that was initiated in 2008 (known as Mi familia progresa) was expanded to reach 0.3 percent of GDP in 2010 (from less than 0.1 percent of GDP in 2008).
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| Jamaica |
- Despite the overall need for fiscal consolidation, the IMF-supported program (approved in February 2010) was designed to help mitigate the impact of economic adjustment on the most vulnerable groups in society through meaningful increases in social spending for targeted programs.
- Spending on well-targeted social assistance programs reached 0.3 percent of GDP in the fiscal year 2010–11, and has been maintained in 2011–12. This includes the school nutrition program and the cash transfer program known as Advancement through Health and Education.
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| Middle East and Central Asia |
| Afghanistan |
- The IMF-supported program establishes a macroeconomic framework that promotes inclusive growth, human development, and economic stability as foreign troops withdraw from Afghanistan.
- It establishes a floor on social and pro-poor spending, which is identified in the budget in accordance with the country’s poverty reduction strategy and a poverty profile developed by the government of Afghanistan. The floor is set at $370 million for FY2011/12 and at $400 million for FY2012/13.
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| Armenia |
- Under the IMF-supported program, social spending increased from 5.8 percent of GDP in 2008 to 6.6 percent of GDP in 2011.
- Looking ahead, the program aims to protect social spending while at the same time improving the targeting of social safety nets so more benefits can be offered to eligible families.
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| Djibouti |
- Despite the need for fiscal consolidation, measures have been introduced under the IMF-supported program to safeguard and better target social spending. This includes an indicative target for social spending (about 6 percent of GDP in 2011).
- The health and education ministries are exempted from the hiring freeze envisaged under the program, and the lowest wages in the civil service have been increased.
- Subsidies of kerosene, consumed by the most vulnerable groups, remain intact despite fiscal consolidation.
- Taxes on certain basic food imports were eliminated in 2008.
- The IMF is providing technical assistance to the ministry of finance to design a diesel subsidy reform program that would phase out the universal price subsidy and better target vulnerable groups.
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| Georgia |
- Under the IMF-supported program, social spending increased by 13 percent in real terms in 2009-10 (relative to 2008).
- Much of the increase in social spending went initially to provide assistance to internally displaced persons from the 2008 conflict with Russia, and to broad-based, quick disbursing programs, such as an increase in basic pensions.
- Even with the gradual phasing out of these initial social support measures, overall social spending was nearly 5 percent higher in real terms at the end of the program (in 2011) than it was in 2008.
- The highest increases in real terms over the whole period were for spending on health programs (27 percent) and education (12 percent).
- In 2011, during the last year of the program, the government also provided food and electricity vouchers to alleviate the impact of rising food and energy prices.
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| Iraq |
- The IMF-supported program has helped preserve social spending on education and the public distribution system, which provides basic staples to every Iraqi household. Education spending in 2012 is projected to increase by about 50 percent compared to the 2011 budget.
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| Kyrgyz Republic |
- Under the IMF-supported program, the Kyrgyz government raised pensions in 2011, which brought the average pension to about 85 percent of the minimum subsistence income.
- An increase in wages for teachers and doctors, introduced in June 2011, helped raise spending on education and healthcare by more than 0.7 percent of GDP in 2012.
- As part of the upcoming public expenditure review, the IMF will work with the World Bank to develop policy recommendations to increase the share of social spending allocated to low-income and vulnerable segments of the population and improve the targeting of such spending.
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| Mauritania |
- To preserve social spending, the IMF-supported program sets a floor target for pro-poor expenditures, which increased by 10 percent in real terms over 2010–11 to about 31 percent of total spending.
- The IMF has helped the government design a temporary emergency program aimed at mitigating the effects of high food commodity prices and drought on the most vulnerable. Key emergency measures include the replenishment of food stocks in rural areas, free food distribution, and subsidized livestock fodder.
- Under the IMF-supported program, ill-targeted and costly energy subsidies are being replaced by well-targeted social safety nets. Key reform elements, such as the introduction of a fuel price smoothing mechanism and a new electricity tariff grid that preserves lifeline tariffs for the poor, are accompanied by a new social protection strategy and an expansion of existing cash transfer schemes.
- Part of the savings generated by the ongoing subsidy reform will be used to scale up existing targeted safety nets such as conditional cash transfer schemes and school meal programs. These efforts will benefit from the results of the ongoing poverty survey aimed at identifying the neediest population.
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| Pakistan |
- Strengthening the social safety net was a key priority under the IMF-supported program that expired at the end of September 2011.
- Social spending in 2009–10 was significantly higher than in 2008–09, having more than doubled from 0.8 percent to 1.8 percent of total spending.
- The government also provided one-time cash transfers to households affected by the July 2010 floods in an amount totaling 0.2 percent of GDP at the federal and provincial levels.
- In September 2010, the IMF provided $451 million (0.2 percent of GDP) in emergency assistance to help those affected by the floods, especially the poor and the vulnerable groups in need of food, shelter, and medical assistance.
- The 2011/12 budget targets a 15 percent nominal increase in cash transfers. An additional $480 million being provided by donors would bring total cash transfers in 2011/12 to about 0.5 percent of GDP.
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| Sudan |
- A key pillar of the staff-monitored program that expired at the end of 2010 was to shield the poor from the impact of the recession.
- Social transfers were maintained in 2009–10, and even in 2011, despite the need for significant budget cuts following the secession of South Sudan and the subsequent loss of about 75 percent of oil production.
- In January 2011, the government raised the price of some fuel products and sugar and introduced social safety measures to mitigate the negative welfare impact of such price increases on households. These include an across-the-board increase in civil servants’ and pensioners’ wages and a commitment to provide targeted support to poor families and students, further transfers to the health insurance programs, and additional resources for agriculture and industry development funds.
- The IMF is also urging the government to ensure that the increase in capital spending in the 2012 budget be directed to key social and economic infrastructure, such as health, education, training, and access to safe water.
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| Tajikistan |
- Under the IMF-supported program, the government increased social spending from 7.3 percent of GDP in 2008 to about 9.0 percent of GDP in 2011, and intends to increase it further to 9.5 percent of GDP in 2012.
- The increase in social spending over 2009–11 fell partly on transfers to households to help them deal with the decline in disposable income on account of a dramatic decline in remittances inflows during the global crisis.
- The government is working with the World Bank on developing a targeted cash transfer system to protect the most vulnerable segments of the population, and has also committed to reforming the agriculture sector with a view to creating employment opportunities and raising farmers' income potential.
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| Yemen |
- One of the key pillars of the IMF-supported program is fiscal adjustment to create fiscal space for higher social and capital spending.
- In collaboration with the World Bank, the coverage of a cash transfer program has been expanded to include an additional 500,000 of the most vulnerable families (bringing total number of recipient families to 1,500,000) to partially offset the impact of the lifting the fuel subsides.
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