Erbil, Kurdistan Region of Iraq September 21, 2016 - The Kurdistan Regional Government has approved a new strategic framework to strengthen the Region’s social protection programs
“The new Framework strengthens and aligns KRG’s social protection system with the KRG Vision 2020 by promoting more effective strategies for the labor market, for social insurance and for social safety nets, to protect the poor and vulnerable population and provide opportunities for our youth. This comes within KRG’s Economic Reform Plan that was launched in June 2016,” explained Ali Sindi, KRG Minister of Planning, on Wednesday at the launch of the Social Protection Strategic Framework.
“We are pleased to support reforms in social protection in KRG, as part of KRG’s overall economic reform plans,” said Robert Bou Jaoude, World Bank Country Manager for Iraq. The KRG Social Protection Strategic Framework is designed to improve service delivery and benefits for the most vulnerable, while ensuring long term fiscal sustainability.
The reforms will require issuing new laws for Labor, Social Insurance, and Social Assistance. It will also lead to renewal of some of the ministries, and creation of new institutions to implement the new programs. “The KRG Ministry of Labor and Social Affairs will be at the forefront of the implementation of the Framework, and we will look for support from our partners in this process,” said Mohammad Hawdiani, KRG Minister of Labor and Social Affairs.
Labor Market Strategies
The current labor market cannot grow and meet the existing and future employment demands. The Region has one of the largest public sector in the world in terms of per capita ratio.. It also has a high number of educated, unemployed population, especially among women. The three main strategies to reform the Labor Market will include:
- Creating an effective labor supply of well-equipped job seekers and skilled workers through the education and training systems and market driven incentives;
- Increasing labor demand to accelerate employment creation among its population, especially in the private sector; and
- Developing an institutional framework based on timely data analysis, well- designed employment policies, and constructive dialogue among the social partners.
Social Insurance Strategies
Current social insurance covers mainly Public Sector employees. About 85 percent of private sector employees do not have social insurance or pension coverage. The main strategies to reform Social Insurance will include:
- Integrating public, private, and other pension schemes to ensure everyone has access to social insurance regardless where they work;
- Designing and implementing new social insurance programs to expand coverage; and
- Developing Unemployment Insurance program to ensure those who lose their jobs have transitional support.
Social Safety Nets Strategies
While the Region spends a significant amount or its budget on cash transfers, only 11 percent of the poorest are receiving the cash transfer. The new Strategies will focus on:
Using poverty as a main determinant of eligibility for its Social Safety Net Programs and providing effective social care to protect vulnerable and disadvantaged groups; and protecting its human capital by providing incentives for better health and education
“By developing and implementing a comprehensive SPSF, KRG will bring equity in social assistance, opportunity for labor market participation, and resilience in the face of shock. This will be done through a portfolio of programs that together provide Equity, Opportunity, and Resilience,” said Ghassan Alkhoja, World Bank Senior Social Protection Specialist and Task Team Leader.
The new Framework was developed under the guidance of a Steering Committee headed by H.E. the Minister of Planning, and included the Ministry of Labor and Social Affairs, Ministry of Finance, Ministry of Education, Ministry of Health, and the Kurdistan Region Statistics Office, with the technical guidance of the World Bank. Mr. Zagros Fatah, Ministry of Planning Director General of Capital Investment Budget was the Secretary of the Steering Committee and provided overall leadership to the development of the Framework. Extended consultations took place from May 2015 to March 2016 with the public sector, parliament members, NGOs, the private sector, local communities, academia, and international organizations.