BANGLADESH can save around US$4 billion annually, if it can eliminate targeting errors and leakages in the social safety net programmes and cut administrative and transaction costs. By plugging in these loopholes the country can also save $19.32 billion over the next five years, according to the Asian Development Bank.
The Manila-based lender said this while approving a $250 million loan in June as budget support and fixing timeframes to implement the reforms in the social safety net programmes in the next five fiscal years. Under this ADB financial assistance, the government is going to initiate massive policy reforms in its safety net system. It will set up an integrated registry for all beneficiaries by June 2023 to avert miss targeting and duplication. The development lender has already shared a report with the government, giving details about the policy reforms under its social resilience programme.
Meanwhile, economists have maintained that delivering the support to intended beneficiaries is the main challenge as there were previous examples of irregularities like inclusion of ineligible beneficiaries with political connections, leaving many genuine ones out. And because of this, about 65 per cent of the fund from the government’s social safety net programmes went to non-poor owing to nepotism, corruption and political consideration in selecting beneficiaries during the pandemic last year. “Targeting errors are critically high in beneficiary selections,” also added the ADB. A recent study by the Bangladesh Institute of Development Studies also showed that a large part of monetary transfers under the safety net programme ends up in “non-deserving” non-poor groups.
Finance Minister AHM Mustafa Kamal, in a letter to ADB President Masatsugu Asakawa on April 11, committed to implementing the policy reforms, giving details on the steps taken and the future measures to be implemented. A steering committee has already been set up to strengthen the cross-ministerial coordination for implementing the ADB-funded reform measures, ensuring digital payment for all social safety benefits by promoting the use of mobile financial services.
We would say the government should prepare a detailed database of the number of people living below the poverty line, which will help the stakeholders involved in understanding the needs of different target groups. Transparency of the distribution process is crucial in making the social safety net programme effective.
