Monday, 4 July, 2022

Social safety net to be widened

Social safety net to be widened

Popular News

The government is likely to widen the social safety net in the next fiscal year aiming at safeguarding the poor from inflationary pressure stemming from the global commodity price hike. 

The number of beneficiaries of different social security schemes is going up by 1.1 million in the budget for 2022-23 fiscal year to be announced in early June, the finance ministry sources said.

For this, the ministry of finance is now preparing budget proposals for FY23, hiking the social security allocation by Tk 53.86 billion or 5 percent to Tk 1,130 billion, sources added. 

During the outgoing 2021-22 fiscal year, the government had set aside Tk 1,076.14 billion or 17.82 percent of budget money and GDP’s 3.11 percent.

“Budgetary allocations are rising for every sub-sectors of the social security schemes. In the budget of FY2022-23, the allocations may surge by Tk 53.86 billion or 5 percent,” said a finance ministry high official requesting anonymity.

The new allocation, however, will be lower compared to total share of the budget as well as GDP. It will be 16.70 percent of total planned expenditure and 2.6 percent of GDP in FY23.

Allocation is going up for all the social security sub-sectors: food security, social welfare, human resource development, employment generation, pension and family allowance and others.

Currently, some 123 social security schemes are in operation and 24 ministries are tasked with carrying out the programmes.

The food security sub-sector includes the popular social security programmes like OMS, VGD, VGF, food for work and food-friendly programme. The government is going to raise allocation on this important sub-sector by Tk 5.70 billion to Tk 190 billion from Tk 184.30 billion allocations made in the current fiscal year.

Another important sub-sector, social welfare, deals with handicapped people and support centres, gipsies and transgender populations and disadvantaged groups.

Allocation on the social welfare segment is being increased to Tk 335 billion in the next fiscal from Tk 327.60 billion allocation in FY22.

The human resource development sub-sector includes stipends for handicapped students and stipends for primary, secondary and higher secondary students.

The finance minister is going to propose Tk 70 billion for these human resource development social safety schemes, up from Tk 59.21 billion allocation of FY22.

The employment generation sub-sector dealing with food for work and other development-related activities is going to fetch Tk 197 billion, which will be higher than FY22’s Tk 188.43 billion.

The government provides allowances for the elderly population, widows, insolvent disabled people, maternity allowance, and monthly honorarium for the freedom fighters under the pension and family allowance sub-sector.

Budgetary allocation for this important sub-sector is set to rise by Tk 11.10 billion to Tk 278 billion from this fiscal’s Tk 266.90 billion allocation.

Other important social security schemes include the microcredit programme. The government is being set aside Tk 60 billion for providing microcredit. In FY22, microcredit allocation was Tk 49.70 billion.

Official sources said the scope of the social safety net is being widened only for the old aged population and the widows.

A total of 100 upazilas will be included anew in the old age allowance and widow allowance schemes, which will enhance the number of beneficiaries by 1.1 million to 6.8 million.

Despite the increase in the number of beneficiaries, the amount of the allowance will remain unchanged at Tk 500 per month like the previous three fiscal years.

Finance Minister AHM Mustafa Kamal has said the government is preparing the budget attaching the highest importance to poverty alleviation in line with its perspective plan, SDGs and 8th five-year plan.

There is criticism that the government incorporates some expenditure in the social safety net which is not actually social safety activities.

Even, a mid-term review report on the government’s National Social Security Strategy (NSSS) says that some measures like government staff’s pension, food and agro subsidies and microcredit, which are in contradiction with the notion of social safety, have been included in social security allocations.

Kamal is likely to place the government’s 52nd budget of Tk 6,778.64 billion budget at the national parliament on June 09 this year, up from the current fiscal’s original budget of Tk 6,036.81 billion.