The Benefits of Implementing Universal Social Security in Reducing Poverty and Inequality

Universal Social Security Systems Can Reduce Poverty and Inequality

Overview

Human Rights Watch and Development Pathways have released a Q&A document that calls on governments and international lenders to support universal social security systems. According to the report, amid the intersecting crises of economic, food, and climate, governments need to invest with a long-term approach towards universal social security. The report explains that social security is about ensuring that people enjoy their rights at all stages of life regardless of their circumstances and encompasses a web of government programs that support people, including situations where individuals might be affected by unemployment, sickness, disability, old age, or child rearing. However, more than half of the world’s population lacks any form of social security. Even in wealthier countries, significant gaps persist in coverage and adequacy.

The Significance of Social Security

Social security is a key tool for reducing inequality, protecting people from poverty, hunger, and homelessness. Universal social security systems are both a human right and a necessary condition for the realization of other economic, social, and cultural rights. These include the right to an adequate standard of living, such as the right to food and adequate housing. International law obligates governments to provide social security as well as ensure access to quality public services that are essential to human rights, such as education, health care, water, and sanitation. However, more than four billion people currently lack access to any social protection.

Addressing the Coverage Gap

The lack of coverage is most acute in low- and middle-income countries, which face financing gaps between their current social security investments and the amount needed to support a basic level of social security. According to the report, coverage is lowest in Africa, where only 17.4 percent of the population receive at least one form of social security benefit. Whilst rates are higher in Europe and North America, the report highlights that many richer nations fail to properly realize the rights to social security and adequate living standards, including the United States, United Kingdom, and Spain.

Recommendations

Governments should address gaps in social security coverage and adequacy, and influential entities should support social security systems in line with their human rights obligations. Governments should push for the transformation of narrowly means tested targeted programs into more universal systems that can achieve more equitable outcomes for all members of society. The report emphasizes that universal, rights-aligned social security systems are much more effective at reducing poverty and achieving equitable outcomes. Consequently, they are more likely to support economic growth and strengthen progressive social contracts. Governments can address the financing gaps using numerous strategies that protect human rights, such as progressive taxes on wealth and excess profits of large corporations, combating tax evasion and avoidance, and eradicating illicit financial flows. Wealthier nations should help advance equitable social security financing by promoting a Global Fund for Social Protection that complies with human rights requirements.

Conclusion

The introduction of universal social security systems will require significant political will, commitment, and investment, particularly in low- and middle-income countries. There are significant challenges to overcome, including funding and institutional capacity. However, the potential benefits of such systems cannot be overstated. Universal social security systems can play a significant role in reducing poverty and inequality, protecting human rights, and improving economic growth. Governments and international institutions must take urgent action to rectify the current gap in social protection and work towards the implementation of universal social security systems that deliver a basic level of protection for all.

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