Kabul, July 23, 2013 ─ A $12.5 million additional grant, to finance the continuation of a project to improve the public pension schemes and to build systems to provide safety nets to the country’s poorest people, was signed today between the Ministry of Finance and the World Bank.
The Safety Nets and Pensions Support Project started in 2009 to improve the administration of the public pension schemes and pilot a modest program to provide a social safety net to the most vulnerable people. The project has made steady and encouraging progress. The Pension Department’s institutional and human resources structure has been reformed and the key elements of a modernized administration have been put in place. Over the past two years, more than 16,000 of the poorest families (approximately 80,000 individuals) have received cash assistance.
“Reforming and upgrading the social safety and pension administration is important for providing the disadvantaged and retired with assistance.” said HE Dr. Omar Zakhailwal, Finance Minister of the Islamic Republic of Afghanistan. “We thank the World Bank for providing the necessary support in helping us lay the foundations for a modern system to identify and deliver services to the eligible.”
Today’s additional financing will help the Ministry of Labor, Social Affairs, Martyrs and Disabled scale up and expand on the progress made to date. It will further improve the administration of the public pension schemes and will begin supporting the Martyrs and Disabled benefits scheme and develop administrative systems for expanding safety nets, with a focus on targeting the poorest families with cash benefits in selected pilot districts.
"A huge number of public sector retirees as well as the disabled and families of martyrs direly need financial aid from the government to survive," said HE Amina Afzali, Minister of Labor, Social Affairs, Martyrs and Disabled, the Islamic Republic of Afghanistan. “With funding from the World Bank, we’ve been able to design and deliver public pension schemes and safety nets programs to a good portion of these people. The new funding will enable us to reach out to more such vulnerable families across the country.”
The Government’s Afghanistan National Development Strategy (ANDS) and National Priority Programs (NPPs) emphasize Social Protection. The planning and budgetary framework is increasingly pro-poor and includes mapping of pro-poor expenditures. The formal social protection system is comprised of a safety net and pension scheme for public sector workers. Within the safety net, government and donors target various population groups through a number of unconditional and conditional cash and in-kind benefit programs. They also provide social care services and skills development programs. In addition to the government- run programs, there are other programs run by international donors and NGOs, which are mainly cash or food-for-work schemes, primarily in rural areas.
“This additional funding will enable the Afghan government to build on the good work it has started in implementing pension reforms and institutionalizing its safety nets programs,” said Robert Saum, World Bank Country Director for Afghanistan. “Key reforms such as rolling out management information systems and effective financial management will ensure that eligible beneficiaries are identified and necessary services efficiently delivered to over 10,000 poorest families of this country, making them hopeful for a better future.”
The project is expected to be completed by June 30, 2016. Specifically, the additional financing will support:
- Improvement to beneficiary services interface and the rollout of the Management Information System (MIS) for the Public Pension scheme;
- Scaling up the administrative reform of the public pension system to expand coverage to the Martyrs and Disabled Pension Program (MDPP);
- Support for cash transfer interventions to 10,000 - 12,000 poor families (nearly 60,000 individuals), while continuing to improve processes for effective targeting and payment delivery. This will support developing the administrative systems of the Afghanistan Social Protection Program (ASPP) before any major scale up.
- Building institutional capacity of the Ministry of Labor, Social Affairs, Martyrs and Disabled to manage and implement the pension reforms and safety net policy and interventions.