Nepal is one of the biggest social safety spenders against the size of the economy in South Asia.
The country stands second after Pakistan when it comes to providing support to the vulnerable groups, according to a World Bank report.
Nepal’s spending in social safety net is 1.32 percent of the gross domestic product (GDP), that of Pakistan is 1.89 percent, the report titled “State of Social Safety Nets 2015” showed. The report has not mentioned the figures of Sri Lanka and Afghanistan, but India’s social spending is 0.72 percent of GDP.
While Nepal’s spending represents the figures of 2014, Bhutan’s spending has been taken from 2009 data, and that of Maldives from 2010-11 data.
Nepal has been running various social safety net programmes, including Old-age Pension Scheme, Nepal School Feeding Programmes, Karnali Employment Programme and schemes for dalits and endangered communities.
As of 2014, a total of 922,741 elderly people were receiving certain cash from the government, while there are 666,378 beneficiaries under the Nepal School Feeding Programmes.
A total of 323,600 individuals have benefited under the Karnali Employment Programme, according to the report.
Although Nepal, India and Bangladesh introduced the old-age pension scheme in 1990s, Nepal went for universal type, while other two nations went for targeted schemes.
“These schemes have obviously helped in social inclusion and increasing people’s faith in the state,” said Dinesh Thapaliya, regional administrator for the Western Development Region, who has a deep knowledge of social safety nets while serving at the Local Development Ministry.
“Due to universal nature of social safety net schemes in Nepal, there are questions whether the state can sustain them.”
The government spends around Rs28 billion in various social safety net programmes, and the state cannot lower the spending in the days to come. “So it is better to introduce targeted schemes to make them sustainable, said Thapaliya.
He said these programmes should be made more investment-oriented instead of distributive ones for productive use of the resources spent in such programmes.
According to the WB report, low- and middle-income countries devote about the same level of resources to social safety nets (1.5 and 1.6 percent of GDP, respectively), while richer countries spend 1.9 percent of GDP. Cash transfer programmes constitute the highest share of spending in all regions except in Sub-Saharan Africa, where food and other in-kind transfers dominate.
Country Share of GDP