Bangladesh’s social security spending is currently not on the right track, primarily due to misallocation of funds and an inadequate focus on the most vulnerable populations.
While the increase in the overall social security budget reflects a positive intention by the government, the effectiveness of this spending is significantly compromised by how the funds are distributed and what is categorized as social security.
A major concern is the broad definition of “social security” used by the Bangladeshi government, which includes pensions for retired public servants and interest payments on savings certificates.
These allocations, which make up around 30% of the Social Security budget, are not true social safety nets as they benefit individuals who are already financially secure.
This miscategorization inflates the perceived size of the social security program and diverts much-needed resources away from those who are in dire need. The shrinking proportion of genuine social safety net programs is alarming.
According to the Centre for Policy Dialogue (CPD), the share of these programmes in the total budget has declined from over 62% in 2009-10 to just 29% in 2023-24, and their share of GDP has fallen from 1.6% to a mere 0.7%. This trend indicates that the most vulnerable populations are receiving less support over time, which contradicts the purpose of social security initiatives.
Experts like Hossain Zillur Rahman suggest that pensions and similar benefits should be excluded from the social security budget.
Instead, resources should be redirected towards programs that directly benefit the poor and vulnerable, such as those addressing urban poverty and climate change impacts.
This focus would ensure that the most disadvantaged citizens receive the support they need to improve their living conditions.
Reallocating resources within the existing budget is essential, but innovative programme designs and effective monitoring must complement it.
Increasing stipends for primary school students, expanding access to healthcare, and creating targeted support mechanisms are crucial steps.
Such measures require strong political will and a commitment to addressing the disparities exacerbated by rising inflation and economic challenges.
While Bangladesh’s intent to boost social security spending is commendable, the current approach falls short of effectively supporting the most vulnerable.
Bangladesh can better protect its most at-risk citizens by redefining what constitutes social security and prioritizing programs that provide direct aid to the financially disadvantaged.
Ensuring that social security programs are truly inclusive and targeted is vital for fostering a more equitable and resilient society.