The new draft social protection policy of the Ministry of Poverty Eradication and Social Welfare provides a background to social protection in Namibia and an assessment of the current social protection programmes.
It sets out the rationale for the policy and outlines the proposed social protection reforms. The draft policy builds to a significant extent on the recommendations of an ILO assessment of 2014 which proposed a comprehensive social protection floor for Namibia. Thus the new policy envisages widening of social grants, especially the maternity grant (a once-off payment for every woman giving birth) and the universal child grant for every child from birth until the age of 17. Coupled with the already existing universal old-age pension, this presents an important step towards achieving an inclusive social safety net.
A controversial aspect of the policy is the proposed “Basic Income Grant (BIG)” for the unemployed between 30 and 59 years of age. This proposal can be challenged on three grounds. Firstly, referring to this grant as a basic income grant is rather confusing as the BIG is conceptually a universal grant and not an unemployment grant. Secondly, unemployment affects particularly the youth but those in the age category of 18 – 29 years (who are the majority of the unemployed) are arbitrarily excluded from the Ministry’s intended beneficiaries.
Thirdly, only a minority of employed Namibians enjoy permanent employment status with social protection while the majority have to endure “informal” employment conditions and significant vulnerabilities. This makes the identification of the proposed beneficiaries challenging, socially problematic and administratively expensive.
Furthermore, it discriminates against people who live in precarious conditions and try to make ends meet by some form of subsistence farming or informal employment. It would also exclude all women looking after children, as they are not regarded as part of the economically active population.
The ministry’s proposed unemployment grant will thus not close the social protection gap identified in the policy because it relies on targeting and is extremely difficult to implement. Given the nature of employment in Namibia and the resulting difficulties in determining the intended beneficiaries as well as the costly administrative procedures to implement a targeted unemployment grant, it seems more efficient to introduce a universal basic income grant for those between 18 and 59 years of age.
This would avoid targeting and social stigmatisation and possibly tensions amongst those included or excluded. A universal BIG would take into account the recommendations of the ILO report as well as earlier suggestions. Government’s Namtax commission of 2002, for example, stated that the reduction of Namibia’s income inequality is not only as a justice issue, but also a prerequisite for economic growth.
A universal BIG for those btween 18 and 59 years of age would be inclusive and redistributive and thus contribute to a significant reduction of inequality It would contribute towards the realisation of socio-economic rights and human dignity as well as improved standards of living as envisaged in Article 95 of the Namibian Constitution. Furthermore, with the introduction of such a BIG, the Food Bank could be abolished while the provisions for disaster relief could be significantly reduced as the BIG would reach the affected groups.
Given Namibia’s financial constraints and economic recession for the past 3 years, it seems challenging to increase Namibia’s social protection grants. However, what is often overlooked is the fact that the allocation of social grants also constitutes a financial injection into the local economy as the grant recipients tend to spend them on basic consumer goods such as food, clothing, shelter, transport etc. This effectively constitutes an economic stimulus “from below” as has been documented in Otjivero where the pilot project on the BIG was implemented. Such economic interventions “from below” are different from infrastructure projects which tend to accumulate financial resources in the hands of those receiving tenders as experienced during the implementation of TIPEEG and the mass housing project. It is also different from a targeted unemployment grant, which tends to punish economic activity by setting economic activity as an exclusion criteria from the social security system.
The public consultations around the draft national social protection policy are being finalised this month and the policy is expected to be tabled in Cabinet in October. It is a chance for Namibia to finally set up a comprehensive system that will reach everybody in need and to take some significant steps to eradicate poverty. The policy will need a detailed financing plan to avoid the Ministry of Finance simply refusing to allocate the required funds.
Rough calculations indicate that about five percent of Namibia’s GDP would be needed to set up a comprehensive grant system which will bring a host of social and economic benefits for the majority of Namibians. What is required now is the political will to act.
*Herbert Jauch is chairperson of the Economic and Social Justice Trust.