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Establishing a Common Fund for Social Action in Mozambique Albino Francisco, ROSC

Establishing a Common Fund for Social Action in Mozambique Albino Francisco, ROSC. History of Social Protection in Mozambique – Legal and Policy Framework. Comprehensive legal and policy framework Social Protection Law (2007)

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Establishing a Common Fund for Social Action in Mozambique Albino Francisco, ROSC

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  1. Establishing a Common Fund for Social Action in Mozambique Albino Francisco, ROSC

  2. History of Social Protection in Mozambique – Legal and Policy Framework • Comprehensive legal and policy framework • Social Protection Law (2007) • Comprised of Compulsory, Complementary and Basic Social Protection for poor and vulnerable people living in chronic poverty and difficult circumstances • Regulation of Basic Social Security (2009) • National Strategy for Basic Social Security (2010) • Objective: increased programme coverage and impact, system efficiency, improved coordination • Approval of new Basic Social Protection Programmes (2011) • Combined with commitment for one improved holistic and harmonised Social Protection System

  3. Context: Mozambique a strong case for Social Protection • The country has experienced impressive economic growth for the last 15 years, not yet translated into poverty reduction as expected • 60% of the population near the poverty line (poverty line +10%) • High level of unemployment combined with lack of job opportunities • High dependency on subsistence farming • High exposure to weather related and economic shocks • Food insecurity patterns highly correlated with climatic cycles. • HH very vulnerable to small variations in income, either seasonal or annual • Impactsnegatively on investment in health and education • with subsequent long term impact on productive capacity. • About 20% of the population is food insecure • 44% of children under 5 are stunted • Crisis, Riots & recent poverty data have created a new spacefor discussions around solutions oriented to the poorest

  4. Four programmes to be financed 1. PSSB (cash transfers) PSSB- ProgramaSubsídio Social Básico(exists since 1990) Monthly Cash Transfer to poor and labour constrained households to protect consumption and investment in human capital development

  5. 2. Public Works Programme • PWP- Public Works Programme • Cash Transfer to poor HH with members able to work-conditioned to participation in Public Works, with aim to increase HH resilience to shocks, build assets at the HH and at the community level

  6. Partnerships • Since 2006, the National Institute for Social Action secured financial support for the Government Cash Transfer programme from the Netherlands (4 yr support in the amount of €5.2 million) and a 10 yr commitment from DFID in the amount of £20 million). • In 2006, the Social Action Working Group was established with key partners from government line ministries and DPs like DFID, Netherlands, UNICEF and ILO. • This group is now becoming expanded with partners as WB, Irish Aid, SIDA, WFP and CSOs like Helpage, Handicap International and Platform on Social Protection. • Additional parties have expressed interest to join like the EU and Norway as well as the private sector. • IMF is playing instrumental role in debate around enhancing fiscal space for social protection, seconded by civil society advocacy with Parliament.

  7. Trend: Increasing state budget allocations in line with increasing beneficiary targets

  8. Decreased donor dependency for the cash transfer budget, no budget gap for PASD or Social Services in 2012

  9. Social Protection Financing • Key message: • Budget in 2012: The sector’s budget is equivalent to about 0.4% of GDP (USD 65 million). • There has been an increase of 24% compared with 2011. • National Assembly recommended the Government a 40% increase in the 2012 State Budget for the Social Protection Programmes. The basic social security programmes are budgeted at about USD 37 Million. Hence there is still a financial gap. • According to IMF fiscal space for Social Protection is 1,5% of GDP (based on expected increased tax revenue and elimination of regressive fuel and bread subsidies) • Intensified fiscal space and partnerships portray commitment to deepened investment in support of the implementation of the national social protection programmes and is leading to a growing momentum to establish a Common Fund for the Sector.

  10. Social Action Common Fund • Why? What is the Status? • Paris and Ghana Declaration on Aid Coordination and Aid Effectiveness • Pooling of funds in support of implementation of one national social protection programme with one database of beneficiaries and one Informational Management System, M&E and payment modalities • Aim: by joining of funds and more predictability of funds, allow more beneficiaries to be reached on social protection prog’s; simplification and efficiency • Consultant hired to assess funding and financing modalities in Moz through existing SWAPs in Health, Education, Water, Agriculture • Assess donor modalities in support of social protection • Prepare a draft MoU for government to sign with Development Partners on joint funding, financing and procurement modalities • Timeline: to be designed by end ‘12, to be installed & operational by ‘13 • Basic Social Security Council to oversee sector plan implementation.

  11. Muito obrigada, Merci, Thank you

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