Ahmad Khatib, AFP
Last updated: 27 November, 2012

Welfare reform needed for Arab Spring demands

Significant welfare reform must be implemented across the Middle East and North Africa to satisfy the socio-economic demands of the Arab Spring, according to a World Bank-Gallup survey.

Stronger “social safety nets” — such as income support and temporary employment programmes — are needed in the region, where government fuel subsidies “benefit the non-poor to a much greater extent than the poor,” it said.

The report, entitled “Inclusion and Resilience: The Way Forward for Social Safety Nets in the Middle East and North Africa,” surveyed citizens of Egypt and Tunisia, the two countries that led the Arab Spring, and of Lebanon and Jordan, which were mostly untouched by the mass uprisings.

Most of the respondents believed the “primary responsibility for helping the poor should lie with governments, not… religious or charitable organisations or friends and family,” the report said.

And only 30 percent of Egyptians and 22 percent of Lebanese thought their governments’ efforts to help the poor were effective.

That number was significantly higher in Tunisia and Jordan, at 61 percent and 66 percent respectively, with confidence in government measures much lower among the poor than the wealthy.

The survey added that in all four countries, many people were unaware of existing social assistance programmes, the poor least of all.

“The average Egyptian was aware of only two of the six programmes presented to them,” it said.

Those surveyed wanted to see better welfare support for the poor.

“More than eight in 10 adults in each country think that social assistance programmes should focus only on the poor,” it said.

They believed “eligibility should be based on levels of poverty rather than the current method which ignores economic means and relies on broad categories such as widows or the disabled.”

“These views are consistent with those of leading experts on the design of effective social assistance programs,” it added.

Current government grants disproportionately favoured the more wealthy, the report said.

A large proportion of government welfare funding in the region goes to fuel subsidies, with the poor benefiting less than the rich who consume more subsidised energy, it said.

“In Jordan, this results in the richest quintile capturing 50 percent of all fuel subsidy benefits.”

Meanwhile, “less than one-third of the poorest quintile is covered by a social safety net programme other than subsidies” in the region.

In Jordan, where sharp fuel subsidy cuts this month caused violent rioting and calls for King Abdullah II to go, 80 percent of the poorest section of the population are not covered by non-subsidy welfare programmes, it said.

Social safety nets themselves are under-resourced, receiving on average less than 0.75 of GDP which is “fragmented among many small programmes,” while spending on energy represents on average 4.6 percent of GDP.

Paradoxically, “the poor benefit the least from universal subsidies to energy but would suffer the most from their removal,” it said.

Effective social safety nets must therefore be put in place “to soften the impact of any efforts to reduce” energy subsidies, as seen in Jordan.