Safety nets critical to mitigate Covid-19 effects

Thursday, June 4th, 2020 00:00 |

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For no reason of their own, millions of people around the world have no work to go to, or an income for that matter.

Obviously, with the closure of businesses in many countries due to lockdowns to curb the spread of coronavirus, getting work, even in the largest economies, has become an impossible task for the majority. 

The number of jobless people keeps increasing, with the US leading in the numbers of people out of jobs.

But not many people are as lucky as Americans, where the government has been writing cheques worth $1,200 to cushion those registered from the lack of a livelihood, in addition to the enormous economic stimulus package to jumpstart businesses on reopening. 

Countries in the European Union, including Britain which extricated itself from the grouping, also have soft landing for their citizens in times of crisis.

Although the European social model is not uniform, the countries share broad commonalities in offering universal health care, free higher education, and welfare programmes in areas like unemployment insurance, retirement pensions, and public housing.  

In the US, the Department of Labour (DOL) offers unemployment benefits to those who lose jobs involuntarily, like is happening during Covid-19 pandemic.

Latest statistics from the DOL show that over 36 million Americans have applied for unemployment benefits.

Africa, which has majority of the world’s developing economies, is still underdeveloped in its welfare programmes where, ironically, such initiatives oftentimes short-change the neediest cases.

Tanzania runs the Productive Social Safety Net programme that assists the poor through monthly cash transfers.  

The welfare programme in Kenya comprises a cash transfer programme targeting households with orphans and vulnerable children, free primary education, and the older persons cash transfer programme, which provides regular cash transfer to poor and vulnerable persons (65 years and above).

But African countries still have a long way to go before they establish universal and effective social welfare systems.

Indeed, that is one of the reasons why many governments in the continent have avoided total closure of the economy, as it would create a huge humanitarian crisis.

So, what happens in countries with no welfare or other unemployment benefits? It is usually a case of survival for the fittest, with the lives of the poor hanging in the balance during times of crisis. 

Experts see the world ending up in a hybrid system that combines the best principles of socialism, capitalism and democracy.

The days of extremities are now over. To survive, countries will have to take an honest cost-benefit analysis of their current systems, vis a vis the cost to human value. 

To prevent society disintegrating, the Covid-19 pandemic has shown us that countries need to establish social safety nets by guaranteeing a basic level of income for the vulnerable.

Although there might be no standard way of avoiding delinquency, governments should come up with programmes that suit their social and economic conditions.   

Africans, for instance, might rediscover their communal way of life. While the continent has vast resources than many of the wealthy countries, its wealth is shared unequally, with the elite hogging the gains of the political economy at the expense of 90 per cent of the population.

Covid-19 has shown us the need for a strong and wealthy State in the management of public affairs.

While rich countries are releasing massive economic stimulus packages, poor countries are relying almost entirely on donations and foreign aid. Moreover, the rich have savings that can cushion them from the financial hit for a relatively long period.  

Call it the emergence of a new world order, where individual wealth will be secondary to the need for a prosperous and healthy society.  —The writer is a communication expert, and public policy analyst —[email protected]

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