The ‘Financing gender-responsive social protection’ webinar took place on 6 June 2019. The webinar brought together leading experts to discuss the implications for women’s outcomes and gender equality of: (1) The options for securing adequate levels of social protection financing – both contributory and non-contributory; (2) alternative social protection financing instruments; and (3) related challenges, such as existing gender inequalities in the world of work and the explicit/implicit gender bias in existing tax and spending policies.
The event was organised by the Overseas Development Institute (ODI) and the UK Department for International Deployment (DFID), and it is part of the webinar series ‘Social Protection and Gender Equality’.
The event was moderated by Francesca Bastagli (Head of Social Protection and Social Policy, Overseas Development Institute), alongside presenters, Evelyn Astor (Economic and Social Policy Advisor, International Trade Union Confederation), Caren Grown (Senior Director for Gender, World Bank) and Flora Myamba (Independent expert on social protection in Africa).
The webinar opened with an overview of financing structures and the corresponding gender implications, it then moved on to presentations on the revenue side and equity implications and, finally, it discussed the reasons why and how alternative social protection financing instruments matter to gender equality and opportunities. The webinar closed with a Q&A session.
How do different structures of financing affect women and men differently?
Evelyn Astor explained how two social protection financing schemes exist: Contributory and non-contributory. The first one is financed using an employer and worker contribution, which often reflects gender gaps in the labour market. The second one is usually financed by general taxation and women are often the main users, but the benefits are often low. Conditionalities disproportionately affect women in non-contributory schemes. Therefore, coverage tends to be greatest if there is a mix of contributory and non-contributory elements.
In a recent survey by the International Labour Organisation (ILO), it was shown that 46 governments reported in 2018 that lack of fiscal space impeded their ability to provide adequate social protection. However, social protection is financially feasible for most countries: 71 countries could extend social protection to all by spending an extra 2% of their gross domestic product (GDP) or less. However, social spending is decreasing in many countries, especially since the Financial Crisis. Evelyn highlighted that cutbacks have often disproportionately impacted women.
To begin expanding fiscal space, government’s need to review domestic revenue mobilisation (not just spending), address underutilised labour supply (especially in the formal economy), mobilise progressive tax revenue and tackle tax evasion, ensure a fair share of employers’ contributions, reallocate public expenditures and, finally, determine the role of overseas development assistance (ODA), especially in least-development countries.
Tax revenue instruments: Challenges and opportunities for gender equality
Caren Grown focused her presentation on the following questions: (1) What is the role for taxation in financing social protection?; (2) What are some of the implications of the balance of different types of tax instruments for gender equity; and (3) What are some of the challenges/opportunities to improve gender equity in social protection?
Taxes are the largest own source revenue for governments; investments using the tax system signal important government priorities. Some types of taxes are: Taxes on consumption, value-added taxes, import duties and export taxes. Each country has a different mix of different types of taxes. For instance, taxes on labour income are much higher in developed countries than they are developing countries as the latter sources a much higher share of their tax revenue from indirect taxes, such as value-added.
The factors that influence the relative mix of tax instruments also involves administrative considerations, such as the capacity of a government to source and monitor tax. Taxes are always influenced by political considerations concerning the ability to tax.
With respect to gender equity, it is important to mention there are many avenues to realising equity. The first one is vertical equity, which is the progressivity of the system. The second is horizontal equity, which is the ability to have equity within an income or tax bracket across different types of households or individuals. While we focus on equity within the tax system the ideal would be to look considering gender equity in tax revenue and expenditure.
With respect to the challenges of improving revenue raising in the system, the lack of data and disaggregated data is an issue in assessing gender equity. There are also issues of corporate taxation, which is particularly troubling now, as international corporations have the ability to shift taxes across countries. The International Monetary Fund (IMF) is rethinking this factor. It is also important to consider the rise of technology and digital financial services. It has implications for the ability of the government to tax and access better information.
Social protection and gender equality in sub-Saharan Africa
More women work in the informal sector than men – in South Asia, 80% of women work in the informal sector and 74% in sub-Saharan Africa. Flora Myamba stressed how these women are not actively choosing to work in the informal sector. Instead, long term gendered factors; such as unpaid care work, high levels of marginalisation, exploitation, job insecurity, difficulties in securing ownership, and low wages that explain this over representation.
These challenges faced by women in the informal sector affect opportunities to finance gender-responsive social protection. There is also an absence of rights-based opportunities for women (e.g. universal social protection) or access to social protection. This sees a government fiscal strategy with no/low priority on social protection budget allocations and uncertain contributions through supplementary schemes (e.g. Tanzania).
Gender biases in existing tax-transfer systems pose a challenge to gender-responsive social protection financing as the programmes are generally not designed with a gender lens. Therefore, women are missing out on some positive effects of acquiring short/long term assets, access to credit, and decision making.
Flora highlighted some successful cases of social protection programmes addressing gender equity:
- Ethiopia’s PSN: Its goal is to support women’s role in agriculture in addition to their role in food security;
- Bangladesh’s Asset Transfer Programme: Its goal is to increase women’s bargaining power
- Mexico’s Youth and Women Land and Asset Programme: Its goal is increasing access to land.
She also presented some policy and programme reforms to address and strengthen revenue-raising efforts while tackling gender equality, as has been pursued in Tanzania, Swaziland, Kenya, Namibia, South Africa, Zambia, Malawi and South Africa.
Some alternative financing mechanisms for social protection include:
- The reprioritisation of expenditure, as performed by Egypt, Costa Rica, and Thailand;
- taxing harmful products/behaviour, as implemented by the Philippines;
- natural resources taxes, as seen in Zambia and Bolivia;
- and taxing financial sector transactions is in place in Brazil.
Flora closed her presentation highlighting that the way forward is to have gender-responsive social protection for girls and women at different stages of the life course. This requires the need for a combination of contributory and tax-financed schemes.
This blog post is part of the Social Protection and Gender Equality Series, which brings together the summaries of webinars organised by ODI and DFID on the topic. If you have any thoughts on this webinar summary, we would love to hear from you. Please add your comments below!