Closing the Gap: Potential Contribution of Social Assistance for Achieving Sustainable Development Goals
This brief discusses the fiscal requirements to meet the social protection-related targets of SDGs, particularly for social assistance programs in ADB’s 16 developing member countries in Asia.
If the first Sustainable Development Goal (SDG) to “End poverty in all its forms everywhere” is to be taken seriously, most low- and middle-income countries face a huge challenge.
Social assistance programs, especially cash transfer programs, have become increasingly popular in low- and middle-income countries. Its positive impacts on the lives of the poor and vulnerable have also accumulated over the past decade. SDG Target 1.3 (Implement social protection, including floors) explicitly recognizes the potential of social protection systems for eradicating poverty. However, with social assistance policies underperforming in most countries, simply allocating more money—though urgently needed—will not solve the problem. This brief discusses how to close the social assistance gap through 2030.
- Global poverty rate has fallen, but the living standard of people living below the international poverty line has hardly changed. Ending poverty as envisioned in the SDG will require additional effort at global and national levels to address chronic poverty traps and improve outcomes for the poor and vulnerable.
- Many countries have invested in social protection over the past decades, and social assistance programs have expanded rapidly. International evidence is highly conclusive about the positive effect of cash transfers on school attendance, food consumption, and the health status of the population, and their multiplier effect.
- Recent estimates suggest that eradication of extreme poverty (lifting everybody to the international poverty line of $1.90 per day in 2011 purchasing power parity [PPP]) would require less than 1% of gross domestic product in most of the 16 countries covered by this paper. But closing the poverty gap up to $3.10 per day in 2011 PPP would require substantially more funds.
- With limited fiscal resources, governments must decide whether to extend coverage (horizontal dimension) or strengthen adequacy (vertical dimension) of social assistance programs. Governments should also invest in the provision of services such as education, health, and infrastructure for social assistance to translate into better opportunities for the poor and vulnerable.