This consultant’s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project’s design.)

Project Number: 44152 Regional — Capacity Development Technical Assistance (R–CDTA) August 2012

The Kingdom of Cambodia: Updating and Improving the Social Protection Index (Cofinanced by the Republic of Korea e-Asia and Knowledge Partnership Fund)

Prepared by Chey Tech For Asian Development Bank

Technical Assistance Consultant’s Report

ABBREVIATIONS AND ACRONYMS

ADB – Asian Development BankAusAID – Australian Agency for International DevelopmentBETT – Basic Education and Teacher TrainingCARD – Council for Agricultural and Rural DevelopmentCBHI – Community‐Based Health InsuranceCDC – Council for the Development of CambodiaCDCF – Cambodian Development Cooperation ForumCDHS – Cambodia Demographic and Health Survey CESSP – Cambodia Education Sector Support Project CHES – Children’s Empowerment through Education Service CMDG – Cambodian Millennium Development Goal CRC – Cambodian Red Cross CSES – Cambodian Socio-Economic Survey DAC – Development Assistance Committee (OECD) DMC – Developing Member Country DP – Development Partner ECD – Early Childhood Development EEQP – Enhancing Education Quality Project EFA EFG

– –

Education For All Employment Guarantee Fund

FFW – Food for Work FTI – Fast Track Initiative GDCC – Government–Donor Coordination Committee GDP – Gross Domestic Product GNI – Gross National Income HEF – Health Equity Fund HIES – Household Income Expenditure Survey HIV/AIDS – Human Immunodeficiency Virus/Acquired Immune Deficiency Syndrome IDPoor – Identification of Poor Households ILO – International Labour Organization IWG-SSN – Interim Working Group on Social Safety Nets M&E – Monitoring and Evaluation MAFF – Ministry of Agriculture Forestry and Fishery MDG – Millennium Development Goal MEF – Ministry of Economy and Finance MoEYS – Ministry of Education, Youth and Sports MoH – Ministry of Health MoI – Ministry of Interior MoLVT – Ministry of Labour and Vocational Training MoP MoRD MSW

– – –

Ministry of Planning Ministry of Rural Development Ministry of Social Welfare

MoSVY – Ministry of Social Affairs, Veterans and Youth Rehabilitation MoWA – Ministry of Women’s Affairs NCDM – National Committee for Disaster Management NPA-WFCL – National Plan of Action on the Elimination of the Worst Forms of Child

Labour

NP-SNDD – National Program on Sub‐National Democratic Development NPRS – National Poverty Reduction Strategy NSDP – National Strategic Development Plan NSPS-PV – Cambodia National Social Protection Strategy for the Poor and

Vulnerable NSSF – National Social Security Fund OD – Operational District ODA – Official Development Assistance PTR – Poverty Targeting Rate RGC – Royal Government of Cambodia SESDP – Second Education Sector Development Project SP – Social Protection SPI – Social Protection Index TB – Tuberculosis TOR – Term of Reference TVET – Technical and Vocational Education and Training WB – World Bank WFCL – Worst Forms of Child Labour WFP – World Food Program WI – Winrock International

CONTENTS

I. INTRODUCTION 1 A. Background 1 B. The Definition of Social Protection 1 C. Report Structure 3

II. COUNTRY OVERVIEW 4 A. Geography 4 B. Demographic Profile 4 C. The Economy 4 D. Poverty Profile 5 E. Labour and Employment 6 F. Education 7 G. Health 7

III. SOCIAL PROTECTION ACTIVITIES AND PROGRAMS 8 A. Data Collection 8 B. Social Assistance 8 C. Social Insurance 10 D. Labor Market Programs 11

IV. SOCIAL PROTECTION INDEX AND ITS DISAGGREGATION 13 A. Basic Statistics 13 B. Social Protection Expenditure and Beneficiaries 14

V. ANALYSIS OF THE COUNTRY RESULTS 17 A. Disaggregation by Social Protection Category 17 B. Disaggregation by Depth and Breadth 17 C. Disaggregation by Poverty 18

VI. CONCLUSION AND RECOMMENDATIONS 19 A. Structure of the SPI 21 B. SPI’s Major Disaggregation 21

I. INTRODUCTION

A. Background

1. Asian Development Bank’s (ADB) development of the social protection index contributed to the strengthening of social protection programs in developing member countries (DMCs). ADB continues its work on updating and improving the Social Protection Index (SPI). The SPI update addresses and incorporates lessons learned from two technical assistance projects1 that developed the SPI for 36 countries in Asia and the Pacific and introduces new components and institutional arrangements to sustain the effective use of social protection indicators in policy analysis and formulation in the DMCs. 2. These initiatives implemented under the ADB commissioned regional technical assistance project2 seeks to (i) improve the methodology in defining social protection for each DMC in order to ensure comparability among DMCs; (ii) improve data gathering for statistical analysis on social protection; and (iii) develop capacity of DMCs in monitoring the SPI and allow comparisons between countries and over time on implementation performance. 3. This country study provides updated information and data on social protection programs and calculates the SPI for Cambodia in view of the revised SPI methodology. The SPI can be updated periodically to assess progress in social protection arrangements in the country and analyse deeper aspects of targeting, coverage and expenditures on various social protection programs; for example, on the breadth (coverage) of social insurance versus social assistance or labour market programs, or on the depth (size of benefit) of various categories of social protection. The revised SPI methodology also provides scope to measure the gender responsiveness of programs, and poverty targeting of programs. 4. The primary objective of the Cambodia Country Report is to present the results on social protection programs and policies in Cambodia from relevant government agencies in Cambodia particularly the Cambodia Development Council, Council for Agriculture and Rural Development, and National Institute of Statistics; and, summarize quantitative information on these activities to enable the formulation of a national Social Protection Index (SPI). B. The Definition of Social Protection

5. Social protection is defined as the set of policies and programs designed to reduce poverty and vulnerability by promoting efficient labor markets, diminishing people’s exposure to risks, and enhancing their capacity to protect themselves against hazards and interruption/loss of income.

6. This definition categorizes all programs under the traditional components of social protection as social insurance, social assistance and labor market programs. Microfinance as a form of social protection is excluded from the calculation of SPI since it does not involve a transfer in cash or kind and beneficiaries incur loans or debt instead of transfers. Thus, by eliminating microfinance from the coverage of social protection programs, three major programs

1 ADB. 2003. Technical Assistance for Social Protection Index for Committed Poverty Reduction. Manila (TA 6120-

REG); ADB. 2006. Technical Assistance for Scaling Up of the Social Protection Index for Committed Poverty Reduction. Manila (TA 6308-REG).REG-TA 6120: Developing a Social Protection Index for Committed Poverty Reduction and REG-TA6308: Scaling Up of the Social Protection Index for Committed Poverty Reduction

2 ADB. 2010. Technical Assistance for Updating and Improving the Social Protection Index. Manila (TA 7601-REG).

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are left: (i) social insurance (i.e., the categories of old-age insurance, programs for the disabled, and health expenditure on insurance and pensions; (ii) social assistance (i.e., the categories of non-contributory health insurance, conditional cash transfers, child protection, and unconditional cash transfers; and (iii) labor market programs as shown in Table 1.

Table 1: Social Protection Categories and Types of Programs

Social Protection Category Type of Program Social Insurance Programs • Pensions

• Unemployment Benefits • Health Insurance - but not universal health insurance • Other social insurance (maternity, disability benefits)

Social Assistance • Assistance for the elderly (e.g., non-contributory basic allowances

for the elderly, old-age allowances) • Health assistance (e.g., reduced medical fees for vulnerable

groups) • Child protection (school feeding, scholarships, fee waivers,

allowances for orphans, street children initiatives) • Family allowances (e.g., in-kind or cash transfers to assist

families with young children to meet part of their basic needs) – excluding any transfers through the tax system

• Welfare and social services targeted at the sick, the poor, the disabled, and other vulnerable groups

• Disaster relief and assistance • Cash/in-kind transfer (e.g., food stamps, food aid) • Temporary subsidies for utilities and staple foods - only if imposed

in times of crisis and if targeted at particular vulnerable groups. General subsidies are excluded even if their rationale is to assist the poor

• Land tax exemptions

Labor Market Programs • Direct employment generation through public works programs – including food for work programs

• Direct employment generation through loan-based programs – included if loans are subsidized and/or job creation is an explicit objective of the program

• Labor exchanges and other employment services – if distinct from social insurance and including retrenchment programs

• Unemployment benefits – if distinct from social insurance and including retrenchment programs

• Skills development and training – included if targeted at particular groups (e.g., the unemployed or disadvantaged children. General vocational training is excluded).

Source: ADB. 2011. The Revised Social Protection Index: Methodology and Handbook. Manila. 7. The Constitution of Cambodia3 is the framework for the scope of social protection provision to all citizens. It covers the right of all citizens to obtain social security and other social benefits, as well as provide special provisions for social security in the formal sector. The Constitution also identifies particular groups that may require special assistance, such as poor

3 http://www.constitution.org/cons/cambodia.htm

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women and children, people living with disabilities, and the families of combatants who have died serving their country. 8. The Constitution of Cambodia addressed the various forms of social protection for Cambodian people, including rights of citizens and responsibilities of the Government which are related directly or indirectly to social protection.

Article 36: “Every Khmer citizen shall have the right to obtain social security and other social benefits as determined by law. Khmer citizens of either sex shall have the right to form and to be member of trade unions. The organization and conduct of trade unions shall be determined by law.”

Article 46: “The commerce of human beings, exploitation by prostitution and obscenity which affect the reputation of women shall be prohibited…The state and society shall provide opportunities to women, especially to those living in rural areas without adequate social support, so they can get employment, medical care, and send their children to school, and to have decent living conditions.”

Article 72: “The health of the people shall be guaranteed….Poor citizens shall receive free medical consultation in public hospitals, infirmaries and maternities. The State shall establish infirmaries in rural areas.” Article 75: “The State shall establish a social security system for workers and employees.”

9. Government legislation also provides provisions that support social protection components; particularly labor market programs, social assistance, and social insurance. The Labor Law4 (1998) complies with most of the International Labour Organization’s conventions on core labor standards. The Law on Social Security Schemes for Persons Defined by the Provisions of the Labor Law (2002) entitles all workers defined by the provisions of the Labor Law to medical, disability and survivor benefits. Also, the Insurance Law5 (2000) provides a legal framework for better regulation of insurance market activities. C. Report Structure

10. The Cambodia report is structured as follows:

(i) Chapter II contains a brief overview of the social and economic development in Cambodia.

(ii) Chapter III describes the current SP activities and programs in the country using ADB’s typology.

(iii) Chapter IV provides an overview of the derivation of SPI and its disaggregation. (iv) Chapter V presents the analysis of the country results. (v) Chapter VI discusses policy assessment and implications.

4 GoCambodia:Laws. Law on Labor. http://www.gocambodia.com/laws/data%20pdf/Law%20on%20Labor/Law%20on%20Labor(EN).pdf 5 Insurance Law of the Kingdom of Cambodia. Unofficial Translation.

http://www.forteinsurance.com/styles/images/resources/Insurance_Law.pdf

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II. COUNTRY OVERVIEW

11. This chapter presents a brief overview of the socio-economic characteristics of Cambodia, main features of the country’s current developmental situation and recent trends.

A. Geography

12. The Royal Government of Cambodia is a coastal country in a dynamic region in Southeast Asia, bordering the Gulf of Thailand, between Thailand, Viet Nam, and Laos. The country lies in the tropics and consists of rolling plains and landforms such as the Tonle Sap Lake and the Mekong River that traverses the country as it flows through the Mekong lowlands to the South China Sea. B. Demographic Profile

13. Emerging from almost three decades of conflict and instability, the country is continuing a process of regional integration and economic growth after the UN mandated resolution for a ceasefire and withdrawal of foreign forces under the Paris Peace Agreement in 1991. The total population estimate for Cambodia is about 13.98 million in 2009 and 14.14 million in 20106 with an estimated 1.2% annual rate of population change between 2010-20157. There is an annual increase of 1.65% in 2009, with a slightly predominant female population of 51.4%. Cambodia also has a relatively young population with almost one-third (32%) of the population at 15 years old and below in 20098. 14. Eighty percent of Cambodia’s population lives in the rural areas although the trend of urbanization is increasing. Cambodia also has a relatively young population with approximately half of the population below 20 years of age, and about 250,000 youth entering the workforce each year9. 15. The average household size in Cambodia is estimated to be 4.7. Furthermore, the estimated average population density is 81 persons per square kilometer. In terms of population distribution, over 83% of the population live in rural areas while 17% of population live in other urban areas. 16. Ethnically, the population consists of 95.7% Khmer, 2.4% Islam (Cham), 0.1% percent Chinese, 0.4% Vietnamese, and other 1.4%. In addition, Buddhist is the predominant religion in Cambodia, accounting for more than 90% of total population most of which is Khmer, followed by 5% Islam (Cham), and a small percentage of Christian and other spiritual beliefs. C. The Economy

17. The Cambodian economy has undergone structural transformation since 1991 as a result of greater integration with the global economy. There is a movement of jobs from agriculture to service sectors, demographic transition, and migration from rural to urban areas. Cambodia has enjoyed robust economic growth of about 11 % per annum from 2004-2007.

6 World Bank. World Development Indicators (WDI) and Global Development Finance (GDF).

http://databank.worldbank.org/Data/Views/Reports/TableView.aspx?IsShared=true 7 United Nations Department of Economic and Social Affairs. World Population Prospects: The 2010, Volume II:

Demographic Profiles. http://esa.un.org/unpd/wpp/country-profiles/pdf/116.pdf 8 National Institute of Statistics. 2009. Cambodia Socio-Economic Survey (CSES). 9 United Nations. 2010. Cambodia Common Country Assessment 2009. Cambodia.

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Despite achieving a poverty reduction rate of 1.2% per year, 2009 poverty data reveal that around 27.4% of Cambodians (about 3.82 million people) still live below the poverty line. As a result of the consolidated peace process since early the 1990s, the country has transitioned from a centrally-planned to a free market-oriented economy. 18. Cambodia experienced a period of rapid economic growth for almost a decade. The economy performed strongly with an average 9.8% growth rate10 prior to the 2009 global economic crisis although the economy recovered the following year. Despite the period of sustained growth, the economic benefits still have to reach most of the rural areas where the vast majority of the population resides. 19. The export-driven economic growth in the country led to infrastructure development and an influx of foreign-direct investment. Other direct sources of economic growth include tourism; industry and services, particularly construction; agriculture; and, the garment industry benefiting from preferential arrangements under the Multi-Fiber Arrangement (MFA), with quota agreements complying with core labor standards. In contrast, the agricultural sector experienced a period of stagnation due to severe flooding over the last 6-7 years. Cambodia is also highly dependent on aid. According to the Paris Declaration Survey 2011, official development assistance to Cambodia totaled $884.5 million11. D. Poverty Profile

20. The rise in food and fuel prices in 2009 exacerbated the economic gains achieved in the last 10 years and contributed to the growing socio-economic inequality in the country. The global financial crisis caused job losses and decreased remittance flows to rural areas, affecting 30% of the population who still live below the national poverty line of $0.60 a day12. A recent study by Cambodia’s Ministry of Planning and the World Bank in 2009 suggest that Cambodia’s poverty headcount has been reduced from 47% in 1993-94 to 27.4% in 2009, or around 1% per annum. Despite the progress in reducing poverty, the country still needs to identify further sources of economic growth in order to achieve its commitment to the Millennium Development Goals by 2015, which would require an average poverty reduction rate of 1.5% per annum. 21. The Royal Government of Cambodia’s commitment in alleviating poverty through social protection is reflected in the ‘Rectangular Strategy’ introduced after the formation of the new Government in July 2004. The strategy has been conceptualized as a structure of three interlocking rectangles, with the rectangles most closely linked to social protection consisting of: i) enhancement of the agricultural sector; ii) private sector growth and employment; and iii) capacity building and human resource development.

22. The Rectangular Strategy outlines the Government’s poverty reduction strategy, operationalised by the National Strategic Development Plan (NSDP) that presents the key sector strategies for achieving the Cambodian Millennium Development Goals’ poverty reduction targets. The NSDP 2006-2010 recognizes the need to address rural development including improving the livelihoods of the rural poor, creating jobs in the formal and informal sectors, ensuring improved working conditions, and providing social safety nets for the vulnerable and disadvantaged.

10 World Bank. 2009. Cambodia: Sustaining Rapid Growth in a Changing Environment. Country Economic

Memorandum Report No. 49158. Washington, DC. 11 UNDP. 2011. Annual Report 2010: Empowered Lives, Resilient Nations. Cambodia. 12 UNDP.

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23. In response to Cambodia having one of the highest disparities between the rich and poor in Asia, the Government adopted the National Strategic Development Plan (NSDP) in April 2010 and engaged development partners in preparing the National Social Protection Strategy for the Poor and Vulnerable (NSPS) that will protect the rural poor against shocks and focus agricultural development as a source of sustainable livelihood. E. Labour and Employment

24. Between 2004 and 2009, the population in Cambodia increased by 1.3 million or 10.3% according to the Ministry of Planning in 2008. During the same period, the working age population increased almost as much as the population, from 6.7 million to 8.9 million or 16.8%. The increase of the working age population resulted in decreasing dependency ratio from 67% in 2004 to 58% in 2009. 25. In contrast to the rapidly increasing working age population, the labor force participation rate fairly slowed by 2.7%. In Phnom Penh, the labor force participation rate remained unchanged. The labor force participation rate fell by 1.7% in other urban areas but increased by 3.5% in other rural areas. 26. According to the Cambodia Development Research Institute (CDRI) projection in 2010, about 3% are unemployed, while about 80%-90% are in the active labor force. Table 2 presents an overview of Cambodia’s population and labor force.

Table 2: Population and Labor Force, 15-64 years (in %)

Cambodia Phnom Penh

Other urban

Other rural

Total population (000) 13,967 1,383 1,428 11,156 Total working age (000) population

8,864 1,002 955 6,907

Labour force (000) 7,480 688 737 6,055 Labour force participation rate (%) Both Sexes 84.4 68.7 72.2 87.7 Women 80.4 61.5 72.7 84.3 Men 88.8 77.2 82.1 91.3 Employment rate Both Sexes 84.3 68.5 77.0 87.6 Women 80.3 61.4 72.6 84.2 Men 88.6 76.9 81.7 91.2 Unemployment rate Both Sexes 0.1 0.3 0.3 0.1 Women 0.1 0.2 0.1 0.1 Men 0.2 0.3 0.4 0.1 Source: Cambodia Socio-Economic Survey (CSES), 2009

27. Almost half of the population in Cambodia is employed as skilled agricultural, forestry and fishery workers. Nearly twice as many women than men are employed in the service and sales industries. In addition, the results of Child Labor Survey (2001) estimate that 2.3 million or 53% of children (aged 5 to 17) are considered to be economically active.

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F. Education

28. Poor access to quality education is a source of vulnerability for young Cambodians. The lack of basic school facilities, shortage of textbooks, and inadequate supply of trained teachers are key constraints. Cambodia suffers in particular from a severe shortage of teachers in primary and secondary education. Dropout rates along with low educational outcomes remain a concern along with particular challenges in writing and mathematics. While enrolment rates are high in primary school (82%), attendance decreases sharply to 29% when students reach lower secondary schools, decreasing more considerably to 13% in upper secondary school. Children in rural areas are more than twice less likely to continue lower secondary school (25%) than children in Phnom Penh (61%). Table 3 shows the enrollment rates by gender.

Table 3: Enrolment Rates and Gender Disaggregation (in %)

Description 2008 2009 2010 Primary Schools (000) 6,635 6,685 6,785 Net Enrollment Total 94.4 95 96 Boys 94.8 95 96 Girls 94 95 95 Completion Rate at Grade 6 85.6 86 88 Lower Secondary Schools (000) 1,451 1,521 1,600

Net Enrollment Total 33.9 40 43 Boys 32 38 41 Girls 35 42 45 Completion Rate at Grade 9 49.1 51 53 Literacy 15-24 years 87.5 88 89 Source: National Strategic Development Plan Update 2009-2013, 2011

G. Health

29. Cambodians experience high costs of access and utilization of essential healthcare services. Total annual health expenditure is about US$119 per capita, which is 5.8 percent of GDP13. Access to quality healthcare is limited for the poor due to inaccessibility and limited operational hours of health facilities; high transportation costs; and, lack of qualified health staff, equipment, and, medicine in remote facilities. Serious outcomes of poor access to quality health care are persistently high maternal and under‐five mortality rates. Children in the poorest quintile are almost three times at risk of dying before the age of five than those in the highest wealth quintile14. 30. The negative consequences of health shocks are often detrimental to the poor and vulnerable and can drive near-poor households into irreversible and damaging poverty with serious, long‐lasting consequences. Health shocks affect poor households with higher prevalence of injuries and illnesses, lesser savings, and mostly trapped in a vicious cycle of high health care costs and debt. Once the cycle starts, it is very difficult to escape. Thus, it is important to prevent the poverty cycle by tackling high health care costs and out‐of‐pocket expenditures at the onset15. 13 World Health Organization. 2009. http://www.who.org 14 Cambodia’s Millennium Development Goals Report. 2011. 15 CARD. 2010. National Social Protection Strategy for the Poor and Vulnerable.

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31. The elderly, people living with chronic illness, and the disabled often depend on assistance from communities and other poor relatives to survive. The elderly need special care given their limited ability to participate in economic life. Cambodia’s elderly have lower health status than older adults in neighboring Asian countries. Even marginal reductions in wealth can result in substantial rises in health problems among the elderly. Elderly women are particularly vulnerable with 10% being sole adults in the household, compared to only 2% for elderly men. 32. Cambodians living with chronic illnesses have very little support to pursue independent and sustainable livelihoods. Children in these households are often at greater risk. According to the Cambodia Demographic and Health Survey (CDHS) in 2005, children with chronically ill parents

are significantly less likely to have basic possessions (e.g., shoes, two or more sets of

clothes, etc.). In a 2004 study, monthly per capita household income is 42% lower in HIV-affected households. Cambodia has the highest rate of prevalence of HIV/AIDS in the region and also ranks 21st among the countries with the highest burden of tuberculosis with an estimated 64% of Cambodians infected with M. tuberculosis. The twin burden of tuberculosis and HIV epidemics can have severe consequences on poor and vulnerable households. 33. Cambodians living with disability also have little assistance and often rely on limited family support to survive. Very few people living with disability have access to rehabilitation and basic services. Their vulnerability goes further than mere lack of financial resources at the individual or family level to encompass cultural and social barriers such as inadequate availability and access to education, health and rehabilitation services; lack of rights awareness; and economic dependency on employed members of the household.

III. SOCIAL PROTECTION ACTIVITIES AND PROGRAMS

34. This chapter presents an overview of the data collection process, objectives, and current social protection activities in the Royal Kingdom of Cambodia including challenges and difficulties encountered during the course of the study. The two-fold objectives of this chapter is to present the main features of the social protection programs in the country and provide quantitative information that will serve as the basis for the formulation of the Social Protection Index. A. Data Collection

35. There are 9 major existing social protection programs in Cambodia. These programs are classified into three major social protection components: (i) social insurance; (ii) social assistance; and (iii) labour market programs. 36. The study used various data collection sources, such as literature and desk review, interviews of relevant government officials and project directors, and statistics and information from the Cambodia Development Council (CDC), Council for Agriculture and Rural Development (CARD), National Institution of Statistics (NIS), and international development agencies. B. Social Assistance

37. There are 3 major social assistance programs: (i) Food for Emergency Relief program; (ii) People Living with HIV/AIDS (PLWHA) program; and, (iii) Maternal and Child Health

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program. Despite a strong commitment by the Royal Government of Cambodia to reduce poverty by targeting the most poor, the annual budget expenditure on social assistance is to some extent, limited. Most Government expenditure on social assistance are in-cash or in-kind transfers to the poor, channeled through the Ministry of Social Affairs, Veterans and Youth Rehabilitation and the National Committee for Disaster Management (NCDM). These benefits include food-aid relief and housing rehabilitation for the poor. In addition, the Royal Palace has also allocated some budget for social assistance, through His Majesty the King, although the amount of expenditure cannot be quantified.

1. Food for Emergency Relief

38. The Food for Emergency Relief program targets households affected by drought, resulting in crop damage and food insecurity. Many drought-prone areas in Cambodia require food relief assistance to address gaps in food access and availability. This program has provided economic support in preventing the sale of assets in order to supplement household income affected by natural disasters. The relief distributions were implemented in collaboration with the National Committee for Disaster Management (NCDM)16 and NGO partners. In 2009, about 0.7 US$ million worth of rice was released to 84,205 beneficiaries. 39. The World Food Program (WFP) also provides food assistance to tuberculosis patients in Cambodia to supplement nutrition, offer incentive to complete treatment, and provide the needed income transfer during illness. The World Health Organization (WHO) classifies Cambodia as one of the 22 high burden countries with tuberculosis in the world17. The disease is more severe in rural areas, particularly affecting the poor and vulnerable population. Food assistance programs help tuberculosis patients stay in medical care and complete their treatment. In 2009, about $2.9 million worth of rice was released to 38,268 beneficiaries.

2. PLWHA Program

40. The (People Living with HIV/AIDS or PLWHA program targets vulnerable groups affected by HIV/AIDS. The PLWHA program was established by the WFP and implemented in collaboration with the National Centre for HIV/AIDS, Dermatology STI (NCHARDS) of the Ministry of Health, and non-governmental organizations. In 2009, about $4.2 million worth of rice was released to 75,879 beneficiaries.

3. Maternal and Child Health Program

41. The Maternal and Child Health (MHC) program aims to reduce the number of underweight children under the age of five, increase awareness of child nutrition and health practices, and build the capacity of health care center staff and village health volunteers in program monitoring. About 63,000 pregnant and lactating women and children under the age of five received nutritional food supplements and health education to aid specific food and nutritional needs. The WFP also provided fortified blend food, rice, vegetable oil, and sugar to enhance the nutritional status of mothers and children, which are the target beneficiaries of the program.

16 CARD. 2010. National Social Protection Strategy for the Poor and Vulnerable. 17 ADB (2011): Handbook for the Revised Social Protection Index

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C. Social Insurance

42. The Royal Government of Cambodia has two major social insurance programs implemented by the Ministry of Social Affairs, Veterans and Youth Rehabilitation (MoSVY) and Employment Guarantee Fund. These programs are pension and health insurance.

1. Pensions

43. The Royal Government of Cambodia pays a pension to an extensive number of its retired civil servants, military, police, disabled people and dependents. The private sector, donors and NGOs also offer pensions to their employees in compliance with the Labour Law. This is normally in the form of a withholding percentage of salary that will be paid as a lump sum upon completion of contract or upon retirement. 44. In 2009, average payments by the Ministry of Social Affairs, Veterans and Youth Rehabilitation (MoSVY) to its civil servants, military, police, disabled people and military, and their dependents, is estimated to be about $16.305 million; benefiting 119,807 persons. Table 4 shows the pension schemes and their beneficiaries.

Table 4: Type of Pension Schemes and Beneficiaries

Type of Pensioners Estimated Number of

Beneficiaries

Amount of Benefits

(in million, USD) Retired civil servants 19,489 4.02 Retired military 5,151 1.14 Disabled military (retired) 31,121 7.01 Disabled civil servant (retired) 5,151 1.13 Dependents of dead patriot military 54,895 2.40 Dependents of dead civil servants 4,000 0.61 Total 119.807 16.31

Source: Annual report of MoSVY and CARD; and interviews, 2010

2. Social and Health Insurance

45. There has been some success in piloting community social health insurance schemes, which have been recently operated and assisted by donors and non-governmental organizations. A few NGOs have operated this scheme targeting the rural poor and urban community. 46. There are a number of health reform proposals that have been adopted by the Government, including official user fees, sub-contracting government health services delivery to nongovernmental providers, and Community Based Health Insurance (CBHI). These approaches have tended to reduce the burden of the poor on public health services. As the result of these reforms, Social Health Insurance policies (SHI), led by the Ministry of Health (MoH) is being devised. This policy includes developing legislative and guidance Social Health Insurance (SHI) schemes; with substantial technical support from various donors including GTZ, the World Bank, ADB, and other development agencies. There are legitimate concerns that a mandatory SHI scheme for the private sector may raise labor costs that they could threaten or damage the competitiveness of the economy.

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47. The establishment of SHI would possibly emerge from the Health Equity Fund (HEF), a new model for financing health of the poor, and microfinance institutions. The Ministry of Health (MoH) and NGOs have provided financial support for the HEF. The Ministry of Health, in collaboration with donors and NGOs, considered shifting HEF to be a Health Insurance Scheme (HIS). HEF aims to ensure financial sustainability, with the poor paying premiums as a member of HIS. All patients are identified and classified into poor or very poor households in the community and provided with health card certificates. This certificate of identification can be shown to provincial, district, and healthcare centers to receive subsidized or free services. Transportation costs and meals are covered. As of 2006, 33,122 people received consultation and 38,705 people received hospitalization benefits. 48. In the absence of a public health insurance scheme, a few NGOs have been operating Community Based Health Insurance schemes (CBHI) in Cambodia. These include the Cambodian Organization for Assistance to Families and Widows (CAAFW), which emerged from HEF, and microfinance schemes that operate in the Banteay Meanchey province, requiring each member to pay around $3 per annum as a membership fee ($1 being subsidized by the organization). Another example of a CBHI scheme is the Sky Health Insurance Project operated by a French NGO, Groupe de Recherche et d'Echanges Technologique (GRET). The Sky Health Insurance Project prevents poor rural households from selling their productive assets, secures the income of rural Cambodian households by providing protection from large health expenditures caused by illness and accidents; and, facilitates access to appropriate quality health care. The project operates in two provinces, Takeo and Kandal, with sub-contracting to a referral hospital, district hospital, and a government health center. D. Labor Market Programs

49. The major labor market programs in Cambodia are the Vocational Training Program, Skills Training program, and the Food for Asset program. The three ministries working to generate potential employment opportunities for the poor in Cambodia are the (i) Ministry of Labour and Vocational Training (MoLVT); (ii) Ministry of Social Affairs, Veterans and Youth Rehabilitation (MoSVY); and, (iii) Ministry of Women’s Affairs (MoWA).

1. Vocational Training Program

50. Majority of vocational training programs is under the jurisdiction of the General Directorate of the Department of Technical Vocational and Educational Training (TVET), and the Ministry of Labour and Vocational Training (MoLVT). There are currently 40 training centers that provide short-term and long-term training courses. The short-term training courses target poor households and are designed to be demand-driven, with a training period between one to four months. The Technical and Vocational Training (TVET) provides mobile training centers to poor communities. These short-term training courses include agricultural development, handicraft, industry, and services. In 2005, the Government supported 13,000 students who received short-term vocational training in Cambodia, at $60 per student for two months. In comparison, long-term training courses provide training modules and an associate degree, which can take up to two years. 51. Vocational training programs are conducted through the municipal and provincial centers in collaboration with NGOs and other development agencies. Vocational training programs are based on labor market needs to expand the National Employment Policy in accordance with the policy on vocational training. Other NGOs and development agencies also provide capacity

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building through vocational training and micro-finance to poor households, aiming to increase income-generating activities. The MoSVY also provides vocational training for disabled people that aim to improve income-generating activities of target beneficiaries. In 2005, there were 9 state-run rehabilitation centers that offered vocational training to 1,318 disabled persons, with 1,058 persons securing employment in industries such as the private sector.

2. Skills Training Program

52. The Department of Family Economic Development of the Ministry of Women’s Affairs (MoWA) through Women in Development (WID) centers provides training skills for orphans, widows, and poor female head of households. Skills-training areas include make-up, sewing, handicraft, and services. The courses last an average of one and a half months. 53. There are 20 training centers, seven of which are under WID, and located in different provinces. The Government, development agencies, and private foundations provide financial support to these centers. In 2003, there were roughly 2,447 beneficiaries who received training skills from MoWA at an estimated $0.110 million.

3. Food for Asset Project

54. The World Food Program in 2009, provided rice through food-for-work in local communities under the Food for Asset Project. This program aims to reduce risk and impacts associated with natural disasters. The remuneration of work for vital food commodities provides villagers with a stake in the asset they are constructing (e.g., rehabilitated roads, constructed ponds, raised paddy field bunds, etc). The vast majority of beneficiaries are the poor that provide labor skills in a village project. Table 5 presents expenditures and beneficiaries of labor market programs in Cambodia.

Table 5: Labor Market Programs Expenditures and Beneficiaries (2008-2010)

SP Programs

Expenditures (US$ millions)

Beneficiaries (000s)

2009 2009 Male Female Male Female

Short-term training course to the poor households 0.20 0.60 25.75 77.25 Provide training skills for orphans, window, and poor female headed households 0.01 0.09 1.50 13.50 Food for work 1.46 1.64 50.29 56.71 Food for work (emergency food assistance project) 0.30 0.30 0.78 0.78 Cash for work (emergency food assistance project) 4.02 2.68 1.68 1.12

Source: Country sources Note: Figures derived based on 2009 Gender Target Rates

13

IV. SOCIAL PROTECTION INDEX AND ITS DISAGGREGATION

55. The revised Social Protection Index (SPI) is a unitary indicator that can be disaggregated for analytical purposes. 56. The revised SPI is calculated by Total Social Protection Expenditures per Total Potential Beneficiaries by 25% of the GDP per capita (representing average poverty line expenditures). In other words, the total social-protection expenditures spread across all potential beneficiaries are compared to poverty-line expenditures in each country. 57. The revised SPI can be disaggregated into two components, one for the ‘depth’ of coverage and the other for the ‘breadth’ of coverage of social protection programs. The first indicator is the Total Social Protection Expenditures divided by the Total Actual Beneficiaries (i.e., the average size of benefits actually received or ‘depth’). The second indicator is the Total Actual Beneficiaries divided by the Total Potential Beneficiaries (i.e., the proportion of potential beneficiaries actually reached or ‘breadth’). 58. The revised SPI can also be disaggregated by the major categories of social protection programs: social insurance, social assistance and labor market programs. When the total expenditures per total potential beneficiaries for each major program are weighted in population terms, the program SPIs add up to the total SPI. 59. Furthermore, the revised SPI can also be disaggregated by expenditures per potential poor and non-poor beneficiaries. Finally, gender-wise data allows the disaggregation of expenditure by gender. 60. The derivation of the SPI for poor and non-poor and the SPI women and men used poverty and gender targeting rates. The rates are based on the results of household surveys; administrative reports of social protection implementing agencies; and in some instances, on the professional judgment of the consultants. A. Basic Statistics

Table 6: Cambodia Basic Statistics for 2009

Statistic Unit 2009 Value Source of Data Notes

GDP (current prices)

Millions (US$)

6,917 Strategic National Development Plan (SNDP) Updated 2009-2013

calendar year

GDP per capita (current prices)

US$ 731 Strategic National Development Plan (SNDP) Updated 2009-2013

calendar year

GNI (current prices)

Billion (Riel)

42,683 http://www.adb.org/documents/books/key_indicators/2011/pdf/CAM.pdf

Calculated to GNI Per Capita

Total Population Millions 14 Cambodia Socio-Economic Survey 2009

14

Statistic Unit 2009 Value Source of Data Notes

Number of unemployed/ under-employed

Millions 1.8 National Accounts 2008

Population aged 60 years and over

Millions 0.5 National Census 2008 Mid-year population estimate

Employed Population

Millions 7 National Accounts

Population living below national poverty line

Millions 3.8 Strategic National Development Plan (SNDP) Updated 2009-2013

Disabled population

Millions 0.3 Ministry of Social Welfare (MSW)

estimate from MSW

Children aged 0 to 14 years

Millions 4.9 Strategic National Development Plan (SNDP) Updated 2009-2013

Mid-year population estimate

Disaster affected population

Millions 0.036 Beneficiaries sheet

Per capita poverty line income (annual)

US$ 468 Cambodia Socio-Economic Survey 2009

Average household size

persons 4.7 National Census 2008

Exchange rate US$1= 4,148 Strategic National Development Plan (SNDP) Updated 2009-2013

Year Average

GDP = gross domestic product, GNI = gross national income Source: Country Sources, 2011 B. Social Protection Expenditure and Beneficiaries

61. The total expenditure on social protection activities in Cambodia for 2009 is about $68 million or roughly 1% of GDP. Social assistance programs accounted for almost 58% of government expenditure compared to 26% government spent on social insurance programs. Expenditure on the remaining components of social protection (i.e., labor market, social assistance and child protection programs) amounted to more than 16% of the total.

Table 7: Social Protection expenditure by Category

2009 Annual Expenditure (million USD)

Percent (%)

Pensions 16.4 24 Health Insurance 1.0 1

15

ALL Social Insurance 17.4 26 Health Assistance 11.2 16 Child Protection 10.7 16 Disaster Assistance and Relief 0.4 1 Other Social Assistance 17.2 25 ALL Social Assistance 39.4 58 Labor Market Programs 11.3 17 Total SP Expenditure 68 100

GDP (million USD) 6,917 SP Expenditure Indicator 1.0%

Source: Country Sources, 2011

62. The largest social protection program coverage are the social assistance programs with more than 3 million beneficiaries, almost 15 times the number of the next largest category – the social insurance programs with 398,000 beneficiaries. Labor market programs have 229,362 beneficiaries.

Table 8: Expenditures and Beneficiaries of Social Protection Programs

Social Assistance Program Implementing

Agency Detailed Category

2009 Expenditure

(Million USD)

2009 Beneficiaries (000s)

Civil Service Pensions MSW PEN 16.4 120

Health insurance for garment factory employees EGF HI 1 278

Medical allowance for AIDS patients MoH HA 1.2 70

Food assistance to Tuberculosis-TB patients

MoH and MSW OSA 2.9 38

Food assistance to people living with HIV/ AIDS MoH OSA 4.2 75

Food to vulnerable groups affected by natural disasters and food insecurity

MSW DA 0.4 36

Short-term training course to poor households MoVLT LMP 0.8 103

Providing training skills for orphans, widows, and poor female head of households

MoWA LMP 0.1 15

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Social Assistance Program Implementing

Agency Detailed Category

2009 Expenditure

(Million USD)

2009 Beneficiaries (000s)

Child Labor Programs MoVLT OSA 1.66 16

Emergency food assistance project (free distribution of rice)

MEF OSA 6.5 342

General food distribution (Ketsana) NCDM OSA 0.7 84

Maternal and child health and nutrition program MoH HA 3.4 64

Fast Track Initiative-FTI (grade 4-6) MoEYS CP 0.22 3.4

Cambodia Education Sector Support Project-CESSP (grades 7-9)

MSW CP 0.82 18

Food for work MoRD LMP 3.1 107

Food for work (emergency food assistance project) MEF LMP 0.6 1.562

Cash for work (emergency food assistance project) MEF LMP 6.7 2.8

Health Equity Fund-HEFs in 50 Ods MoH HA 6.6 2154

School - Feeding Program MoEYS CP 8.1 532

Enhancing Education Quality Project-EEQP (grades 10-12) MoEYS CP 1.22 0.5

Emergency food assistance project (grades 5-6 & 8-9) MEF CP 0.3 12.64

Emergency food assistance project MEF OSA 1.2 60.5

Total 29 2,889.0

17

Note: PEN-Pensions, HI-Health Insurance, UB-Unemployment Benefits, HA- Health Assistance, CP- Child protection programs, DA- Disaster relief and assistance, OSA- Other social assistance, LMP- Labour Market programs Source: Country Sources, 2011 63. Coverage rates for these target groups are obtained by aggregating beneficiaries from all programs of this target group. Beneficiaries from some programs can fall into more than one target group (e.g., recipients of civil service pensions can also be poor; and the school feeding program is both a social assistance and a child protection program). There can also be overlaps with children benefiting from school feeding programs also benefiting from educational assistance programs. Furthermore, some programs can be assigned to more than one target group; although overlaps need to be excluded. However, this is not a significant issue in Cambodia since coverage rates are generally low and there are few overlaps.

V. ANALYSIS OF THE COUNTRY RESULTS

64. This chapter presents the results of the SPI calculations and its disaggregation into the three categories – social insurance, social assistance, and labor market programs. Further disaggregation by depth and breadth of coverage, by poor or non-poor, and by women or men is also discussed. A. Disaggregation by Social Protection Category

65. The SPI represents the average expenditure per beneficiary as compared to the poverty line expenditures (set at 25% GDP per capita). For Cambodia, the overall SPI is 0.020, which implies that on the average the government expenditures on social protection are about 2.0% of the poverty line expenditures. As shown in Table 9, among the three categories, social assistance has the highest SPI at 0.012, while social insurance and labor market programs have 0.005 and 0.003, respectively. These indices for social insurance, social assistance and labor market programs indicate that the per capita government expenditures are about 0.5% 1.2% and 0.3%, respectively of the poverty line expenditures.

Table 9: Disaggregation by Category

Social

Insurance Social

Assistance Labor Market

Programs All SP

Programs Total SP Expenditure (Million USD) 17 39 11 68 Beneficiaries (000s) 398 3,506 229 4,133 Reference Population (000s) 7,536 9,061 1,750 18,347 25% of GDP per capita 183 183 183 183 SPI 0.005 0.012 0.003 0.020

Source: Consultant estimates, 2011

B. Disaggregation by Depth and Breadth

66. The depth refers to the average size of benefits received by beneficiaries of social protection while the breadth indicates the proportion of potential beneficiaries reached by social protection programs in Cambodia. The 2009 depth index is 0.090 while the breath is 0.225. These numbers imply that the average amount receive by beneficiaries is about 9.0% of the poverty line expenditures and these benefits reached about 22.5% of the targeted beneficiaries

18

in 2009. This suggests that there is wider coverage but the size of benefit received per beneficiary is relatively small.

Table 10: Disaggregation by Depth and Breadth

Social

Insurance Social

Assistance Labor Market

Programs All SP

Programs

Depth 0.542 0.027 0.270 0.090 Breadth 0.022 0.191 0.013 0.225 SPI 0.012 0.005 0.003 0.020

Source: Consultant estimates, 2011

C. Disaggregation by Poverty

65. The calculation of this indicator involves a series of assumptions on the poverty targeting rates (PTRs) for different social protection programs and an assessment of the extent of overlaps (i.e., people who benefit from more than one program).

67. In the absence of a comprehensive statistic showing the incidence of poor beneficiaries of the different social protection programs identified in this report, it is necessary to adopt an ad hoc estimation methodology. This involves the assignment of poverty targeting rates (PTRs) or the proportion of beneficiaries who are poor, to each social protection program. Information used to generate these PTRs are from survey data, interviews conducted with program officials, reviews of evaluation studies, and the consultants’ professional knowledge of these programs. 67. The disaggregated data shows that SPI for the poor is slightly lower (0.008), which means that the social protection expenditure on the poor is lesser compared to the expenditure on non-poor, whose index is 0.012. The higher index for non-poor can be related to the social protection expenditures of social insurance, whose beneficiaries are employed and are not considered poor.

Table 11: Disaggregation by Poverty Status

Poor Non-Poor SP Expenditure (Million USD) 28 40 Reference Population (000s) 18,347 18,347 25% of GDP per capita 183 183 SPI 0.008 0.012

Source: Consultant estimates, 2011 A. Disaggregation by Gender 68. The gender wise data allows the disaggregation of expenditure by gender. This does not show much variation for men and women for the Kingdom of Cambodia. The SPI for men (0.011) is slightly higher than for women (0.009). However, it should be noted that in the absence of gender disaggregated data, most of the gender targeting data of the programs are at best approximations.

19

Table 12: Disaggregation by Gender

Women Men SP Expenditure (Million USD) 31 37 Reference Pop (000s) 18,347 18,347 25% of GDP per capita 183 183 SPI 0.009 0.011

Source: Consultant estimates, 2011

VI. CONCLUSION AND RECOMMENDATIONS

69. Cambodia has a low SPI value of 0.020, which indicates that the average per capita social protection expenditures is about 2.0% of the poverty line expenditures. While social assistance programs covers the most number of beneficiaries, with breadth of 22.5%, there is little provision for the elderly, poor, unemployed and the disabled as indicated by the depth index of 0.090. This value implies that the average benefits of social protection is about 9.0% of the poverty line expenditures. Furthermore, in most cases, the benefits provided have minimal impact on recipient incomes. 70. Cambodia’s social protection indicators are low and it is a relatively poor country with limited financial resources. Thus, the scope for major improvements in social protection reflects immediate priorities such as the need to respond to the food crisis, financial crisis, or natural disasters; rather than a shared long-term social protection intervention. Priorities for strengthening the social protection system are therefore essential, and account for the current national development priorities such as improving health care, education and basic infrastructure in rural areas. 71. With over 90% of the poor living in rural areas, initial efforts to improve the level of social protection should be mostly concentrated in these areas. This overall policy focus would give greater importance in (i) developing food for work programs; (ii) increasing the coverage of labor market program; (iii) giving greater emphasis on pro-poor targeting; (iv) strengthening and increasing the coverage of educational assistance schemes; and (v) investigating the need for targeted health assistance programs. The data on social protection programs provided for other countries, especially those with similar levels of human development, wealth and social protection provision, could provide an indication of the types of programs that can be developed. 72. It is expected to have further increases in social protection activities in Cambodia as the Government strives to achieve its MDGs. Improving the effectiveness of existing programs, and evaluating the impact of new, social protection programs require a sound monitoring mechanism. The SPI and its disaggregation provide a monitoring tool at the national level while the program specific data provides more detailed information on problems and improvements that can be made to these social protection programs. However, the SPI can only be truly useful if it is periodically updated. The information and database collection could also be improved if the modules covering the major social protection programs are included in future household surveys.

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REFERENCES

ADB. 2007. ADB Scaling Up of the Social Protection Index for Committed Poverty Reduction: Final Report 2007. Manila: Asian Development Bank.

ADB. 2011. Handbook for the Revised Social Protection Index. Manila. ADB. 2011. Key Indicators for Asia and the Pacific 2011.

http://www.adb.org/documents/books/key_indicators/2011/pdf/CAM.pdf CARD. 2009. Concept Note and Inventory (June 2010): Safety Nets in Cambodia. Phnom Penh:

Council for Rural Agricultural and Rural Development. CARD. 2010. National Social Protection Strategy for the Poor and Vulnerable. Phnom Penh:

Council for Rural Agricultural and Rural Development. CDRI. 2005. Cambodia Annual Development Review: Annual Report 2009-2010. Phnom Penh:

Cambodia Development Resource Institute. CDRI. 2010. Cambodia Development Review: Annual Report 2010. Phnom Penh: Cambodia

Development Resource Institute. CDRI. 2011. Cambodia Development Review: Annual Report 2011. Phnom Penh: Cambodia

Development Resource Institute. ILO. 2008. ILO IPEC’S Time Bound Project Supports the Royal Government of Cambodia’s

National Plan Action on the Elimination of the Worst Forms of Child Labour. Geneva: International Labour Organization,

National Institute of Statistics. 2008. Cambodia Census Survey 2008. Phnom Penh: Ministry of Planning.

National Social Security Fund. 2009. Achievements in 2009 and Action Plan in 2010. Phnom Penh: Ministry of Planning.

National Institute of Statistics. 2009. Cambodia Socio-Economic Survey 2009. Phnom Penh. I. Ortiz, ed. 2001. Social Protection in Asia and the Pacific. Manila: ADB. Royal Government of Cambodia. 2008. National Nutrition Strategy 2009-2015. Phnom Penh:

Ministry of Health. Royal Government of Cambodia. 2008. Statistical Yearbook 2008, (National Institute of

Statistics, Ministry of Planning). Phnom Penh: Ministry of Planning. Royal Government of Cambodia. 2009. Health Financing Report. Phnom Penh. Royal Government of Cambodia. 2010. National Strategic Development Plan Updated 2009-

2013. Phnom Penh. Royal Government of Cambodia. 2010. Achieving Cambodian Millennium Development Goals.

Phnom Penh. Royal Government of Cambodia. 2010. Comprehensive Post-Disaster Needs Assessment,

Ketsana Recovery and Reconstruction in Cambodia. Phnom Penh. World Bank. 2011. Word Development Indicators. http://data.worldbank.org/country/cambodia Winrock International. 2010. Children’s Empowerment through Education Service (CHES)

Project Supports the Royal Government of Cambodia’s National Plan Action on the Elimination of the Worst Forms of Child Labour. Arkansas.

21 Appendix 1

FORMULATION OF THE SOCIAL PROTECTION INDEX AND ITS MAJOR DISAGGREGATION

A. Structure of the SPI

1. Based from the 2011 SPI Handbook by Baulch’ and McKinley, the SPI is described as a simple and unitary indicator rather than a composite index. It is not an abstract index and should provide a “normative” reference such as the magnitude of the impact on people.

2. The formulation of the revised SPI, under the present study, refers to the total SP expenditures divided by the total potential beneficiaries, and relative to a quarter of GDP per capita. This is mathematically expressed in the following equation:

     

where

E represents the sum of all SP expenditures; PB represents the sum of all potential beneficiaries; and Z represents poverty-line expenditures which is 25% of GDP per capita.

3. The term “Total Expenditures per Total Potential Beneficiaries” has two parts:

(i) Total expenditures per total actual beneficiaries – this represents the Depth of the SPI;

(ii) Total actual beneficiaries per total potential beneficiaries – this represents the Breadth.

4. It is noted that 25% of GDP per capita is roughly the average national poverty line across ADB’s sample of countries.

B. SPI’s Major Disaggregation

1. Disaggregation by Depth and Breadth

5. The SPI can be disaggregated into measuring the depth of coverage and also, the breadth of coverage. Depth represents the average expenditures that the government spends for every actual beneficiary as a percentage of poverty-line expenditures.

a. Depth

6. The index is measured as

(Total Expenditures divided by Total Actual Beneficiaries); Divide by Z or the poverty-line expenditure. 7. The index is represented by the following equation:

22 Appendix 1

where

D represents Depth E represents the sum of all SP Expenditures, and

Z represents the poverty-line expenditures.

b. Breadth

8. The breadth of coverage index is simply the proportion of the total actual beneficiaries receiving government benefits over the total potential beneficiaries. This is computed as

Total Actual Beneficiaries divided by Total Potential Beneficiaries.

9. The index is represented by the equation

where

B denotes Breadth, AB represents the sum of all actual SP beneficiaries PB represents the sum of all potential SP beneficiaries. 2. Disaggregation by Component

10. The second major disaggregation involves the three-way distinction between components.

11. Each of the three components for Expenditures per Potential Beneficiaries of SI, Potential Beneficiaries of SA, Potential Beneficiaries of LMP is multiplied by its weight. The mathematical relationship between the three components is based on weighted average.

(i) SPI for Social Insurance (includes pensions, health insurance, and unemployment benefit)

(ii) SPI for Social Assistance (includes assistance for the elderly, health assistance, poverty programs and child protection)

(iii) SPI for Labor Market Programs (include training and public works scheme)

12. The formula for the SPI of each of the three categories can be illustrated by the formula for SPIsi. Deriving the SPI for Social Insurance proceeds as

(SI Expenditures divided by SI Actual Beneficiaries) multiplied by

Appendix 1 23

(SI Actual Beneficiaries divided by SI Potential Beneficiaries) multiplied by (SI Potential Beneficiaries divided by All SPI Potential Beneficiaries) multiplied by 1/Poverty-Line Expenditures.

13. The SPI for SI is expressed in the equation

14. The last expression in the numerator represents the proportion of SI, which is the potential SI Beneficiaries divided by the Total SPI Potential Beneficiaries.

Z represents the poverty-line expenditures.

15. After each of the three components’ expenditures per potential beneficiaries (SI, SA, LMP) has been multiplied by its weight, all three are added together. The resulting total is the country’s SPI. This is shown as

SPI = SPI (SI) + SPI (SA) + SPI (LMP)

3. Disaggregation of Expenditures on Poor and Non-Poor Beneficiaries

16. The SPI can be disaggregated by expenditures on poor and non-poor beneficiaries.

a. SPI (Poor)

17. The index is derived at as follows:

SPIp represents the total expenditures per poor actual beneficiaries as a ratio to all potential beneficiaries both poor and non-poor. The index is computed as:

(Total Expenditures on the Poor divided by the Total Poor Actual Beneficiaries) multiplied by (Total Poor Actual Beneficiaries divided by Total Potential Beneficiaries).

18. The index is represented by the following equation:

b. SPI (Non-Poor)

19. SPInp represents the total expenditures per non-poor actual beneficiaries as a ratio to all potential beneficiaries, both poor and non-poor.

20. The index is derived as

24 Appendix 1

(Total Expenditures on the Non-poor divided by Total Non-poor Actual Beneficiaries) multiplied by (Total Non-poor Actual Beneficiaries divided by Total Potential beneficiaries).

21. The index is represented by the following equation:

22. When SPI (Poor) is multiplied to SPI (Non-Poor), the product represents the SPI of the country.

25 Appendix 3

CHECKLIST FOR INFORMATION ON SOCIAL PROTECTION

Asian Development Bank: Social Protection Index Social Protection Program - Information Checklist

Interviewer and date (including any follow-ups): Details of person interviewed Name of Program: Name:

Position: Department/Division: Organization:

Responsible Agency: Contact Details Tel: Email:

Years program first implemented

Funding Sources

(approx. %)

Govt. Internat’l ..% ..%

Program Description (including objectives, target group(s), activities, contributory/non-contributory, level of government (national, state, local)): Main eligibility criteria and characteristics of beneficiaries: Description of Benefits Provided (in cash and in kind, regular or periodic, for individual or household, unconditional or conditional): Expenditure and Beneficiaries Year

2008 2009 2010 No. of persons participating (for insurance schemes)

No. of beneficiaries (i.e. actually receiving benefits)

Annual cost / expenditure (in local currency, excluding administrative/operating costs)

Any other relevant information (e.g. Other sources of information)

NB. You will probably need to use 2 pages for the larger programs as well as appending any detailed statistical information.