©Oumou Sow / UNDP Mauritania
One of the key commitments featured in the 2030 Agenda and the Sustainable Development Goals (SDGs) is that no one shall be left behind, or that the goals and targets shall be met for all nations and all peoples, especially the poorest and most vulnerable. Social protection or safety net systems have been one instrument that governments have turned to in an attempt to reduce poverty and inequality and support the most marginalized, and in addition, a method that many more governments are looking towards as a way to achieve the SDGs. Most social protection policies directly target several of the SDGs, including SDG #1 No Poverty, #3 Good Health and Well-Being, #4 Quality Education, and #10 Reduced Inequalities, while also indirectly addressing other SDGs such as #2 Zero Hunger, #5 Gender Equality, and #8 Good Jobs and Economic Growth. Different social protection policies and instruments in various forms, including social assistance (i.e. conditional cash transfer (CCT) programs and social insurance) and labor market interventions, have been designed and implemented around the world and have been successful in achieving poverty reduction in developing countries. Yet despite these efforts nearly 800 million people still suffer from hunger, and only one in five people in low income countries, compared with two in three in upper-middle-income countries, receive social assistance or social protection benefits.
Social protection policies in most regions around the world have traditionally focused on the social and economic pillars of development, with little attention to environmental aspects, although there is much potential in linking environmental sustainability and social protection and thus reaching the 800 million that are still undernourished, as well as the millions of others whose livelihoods are directly based on natural resources and ecosystem services. In addition, climate change is proving to have dire consequences on these communities where climate shocks are often a major factor of vulnerability. For instance, the Sahel and Horn of Africa is becoming one of the most vulnerable regions to climate change; with an estimated 20.4 million people that faced food insecurity in the Sahel at the beginning of 2015 (due to a combination of factors including drought, poor accessibility to food, environmental degradation, displacement, and conflict) this will worsen with a changing climate. In addition, Latin America and the Caribbean is known to be one of the most disaster prone regions in the world: According to the FAO, one-third of the population lives in areas with a high risk of natural disasters (frequent and extreme storms, droughts, hurricanes, flooding), and as these disasters become more frequent as a result of climate change, this region is also becoming more vulnerable. Globally, a recent study by the World Bank has sustained that, unless immediate climate action is taken, 100 million additional people may fall into poverty by 2030.
Climate vulnerability and social protection are more connected than it may appear at first glance. As exposure to climate shocks often causes loss of physical and human assets, more assistance is often needed to compensate for what is lost. Environmental and economic shocks also often constrain poor and vulnerable households to adopt ex-post coping strategies in the short-run or fall again into poverty when shocks swell. Coping strategies include the use of buffer stock savings, depletion of other physical productive assets including natural capital, and pulling children out of school to be sent to work in order to offset the income and consumption shortfalls. Similarly, social protection can actually aid in supporting and addressing climate risks and shocks by diversifying household income and acting as a form of adaptation.
Despite this fact, questions of climate risk and adaptation to climate change have been particularly missing from social protection programs. According to a recent UNDP study of Latin America and the Caribbean, out of 50 conditional cash transfer systems studied, only five directly integrated environmental vulnerability and climate risk into the program. The few social protection systems that are used to respond to environmental concerns and climate-related shocks are often done as programs separate from national social protection policies or by different ministries, which are often problematic, inefficient, and redundant if ministries do not coordinate or interact. Some countries have taken steps to make strong social protection programs that incorporate climate risk, such as Ethiopia’s Productive Safety Net Programme (PSNP) or India’s Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). Yet, in regard to natural disasters, many ex-ante interventions still have proven to be extremely costly where natural hazards occurred and hit social assistance programs that include service subsidies, food transfers, cash transfers, and conditional cash transfers.
In order to improve households’ resiliency to natural disasters and climate change, and thereby enable sustained growth, it is important to manage risk through social protection and to also build resilience of poor households by investing in sustainable productive activities which they are involved. As such, a growing conversation on the potential synergies between climate adaptation and social protection is occurring. Social protection programs, particularly cash transfers that incorporate the question of climate change adaptation, provide a way to address climate risks, as well as reach the populations that are the most vulnerable to climate shocks by providing a means to increased resiliency and household coping capacity. One way of doing this is to combine social protection and the use of modern financial instruments and thereby target climate and natural hazards. Climate finance in particular presents a potential to institutionally interlink climate and social protection and build the most vulnerable resilience to climate and disaster shocks, ensure that no one is left behind, and achieve, as well as sustain achievement of the SDGs.
Keep an eye out next week for Part 2 of “The Missing Link: A New Role for Climate Finance in Social Protection” to learn about what the RIO+ Centre is doing to support efforts in integrating climate finance and social protection.
Read more about Social Protection for Sustainable Development
 UNDP PEI (2015): Estudio sobre la incorporación de variables ambientales en los sistemas de transferencias monetarias condicionadas.