Chaotic Social Security Reform in Sri Lanka: A Violation of People’s Rights

In Sri Lanka, Chaotic Social Security Reform Denies People’s Rights

The Plight of Shanthi

Last month, Shanti, a resident of a town near Colombo, saw her home’s electricity cut off by the Sri Lankan electricity company. Shanti had lost her job during the country’s severe economic crisis last year and now works as a domestic cleaner, earning only 300 rupees ($0.95) per day – half of her previous wages. As a result of the crisis, which led to government defaulting on its debt, inflation soared, especially for food. Shanti and her son relied on her employers and relatives for food. In late 2022, her monthly electricity bills started to rapidly increase, leaving her unable to pay them. Consequently, she and her son have been forced to sleep in the living room of her mother’s apartment.

The Government’s Reforms and their Consequences

The Sri Lankan government, in an effort to improve its finances, raised electricity tariffs and phased out fuel subsidies as part of a deal with the International Monetary Fund (IMF) to secure a $3 billion loan. These measures resulted in a spike in prices and have disproportionately affected vulnerable families like Shanti’s. In addition, with the support of the World Bank, the government implemented a reform of the country’s cash transfer program, Samurdhi, and introduced a new program called Aswesuma.

However, the implementation of these reforms has only exacerbated the crisis faced by Shanti and thousands of other families. In July, Shanti did not receive her usual monthly benefit from Samurdhi and was instructed to apply for Aswesuma instead. However, she has yet to receive a response. The government has acknowledged the numerous appeals and objections it has received and has committed to reviewing them, but this has left individuals like Shanti in a state of uncertainty.

The Problems with Targeted Programs

Research has shown that programs like Aswesuma, which target individuals based on their economic status, are prone to errors, arbitrary cut-offs, corruption, and social mistrust. Instead, it is argued that governments should establish universal systems that provide income support to everyone during critical moments in their lives, without being tied to their economic status.

Shanthi’s Desperation

For Shanthi, the consequences of these chaotic reforms are dire. She describes herself as “completely destitute” and sometimes feels that it is impossible to live. Shanthi’s story highlights the urgent need for a more comprehensive and inclusive approach to social security in Sri Lanka.

Opinion: A Call for Universal Systems

This crisis in Sri Lanka’s social security system calls into question the effectiveness of targeting specific individuals based on economic status. While such targeted programs may have their merits in theory, the reality is far more complex and often leaves vulnerable individuals like Shanthi in a state of uncertainty and desperation.

The key issue with targeting programs is the inherent difficulty in accurately identifying individuals who are in need. Often, eligibility criteria are based on arbitrary cut-offs, leading to widespread errors and individuals who fall through the cracks. Furthermore, there is the risk of corruption and social mistrust, as individuals question the fairness and transparency of the targeting process.

Instead, a universal system that provides income support to everyone during critical moments in their lives is a more equitable and efficient approach. By removing the need for complex and arbitrary targeting, a universal system ensures that no one is left behind and eliminates the possibility of errors or corruption. This approach promotes social cohesion and trust, as individuals have confidence that they will receive support when they need it most.

The Role of Government and International Institutions

It is crucial for the Sri Lankan government to acknowledge the flaws in its current social security system and take immediate action to rectify the situation. The government must prioritize the needs of its citizens, especially the most vulnerable, and develop a comprehensive social security program that is inclusive and reliable.

Furthermore, international institutions such as the IMF and the World Bank have a responsibility to ensure that their financial assistance does not exacerbate existing social inequalities. While their support for reform may be well-intentioned, it is imperative that they consider the real-life consequences of their recommendations. Social impact assessments should be conducted to anticipate the potential negative effects of reforms and to develop mitigating measures.

Recommendations

In light of the current crisis in Sri Lanka’s social security system, I propose the following recommendations:

1. Establish a Universal Social Security System

The Sri Lankan government should transition to a universal social security system that provides income support to all residents, regardless of their economic status. This system should be designed to respond to critical moments in individuals’ lives, such as job loss or economic downturns, ensuring that no one falls into destitution.

2. Strengthen Oversight and Accountability

The government must strengthen oversight and accountability mechanisms to prevent corruption and errors in the administration of social security programs. This can be achieved through regular audits, transparent reporting, and whistleblower protections. Additionally, the government should establish an independent body to address complaints and grievances related to social security benefits.

3. Conduct Social Impact Assessments

International institutions such as the IMF and the World Bank should conduct comprehensive social impact assessments before recommending or implementing reforms. These assessments should consider the potential consequences of reforms on vulnerable populations and propose mitigating measures to address any negative effects.

4. Promote Economic Stability and Job Creation

The Sri Lankan government should prioritize measures that promote economic stability and job creation. This includes investing in infrastructure, supporting small and medium-sized enterprises, and fostering an environment conducive to business growth. By addressing the root causes of economic instability, the government can reduce the need for social security programs in the long run.

Conclusion

The chaotic social security reform in Sri Lanka has left vulnerable individuals like Shanthi in a state of uncertainty and desperation. It is imperative that the government takes immediate action to establish a universal social security system that provides income support to all residents. Additionally, international institutions must consider the real-life consequences of their recommendations and conduct social impact assessments to mitigate any negative effects. By prioritizing the needs of the most vulnerable, Sri Lanka can build a more equitable and inclusive society.

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