World Social Protection Report 2017-19

ILO: Timor-Leste’s social protection is a good example for developing countries

55 per cent of the world population do not have any social protection. Timor-Leste shows it is possible to offer substantial protection to citizens even in developing countries.

News | 30 November 2017
Local farmers in Timor-Leste
DILI,Timor-Leste (ILO News) –Only 29 per cent of the world population enjoy comprehensive social protection and more than 1 out of 2 people have no protection at all, says the ILO in its new World Social Protection Report 2017/19. This leaves many vulnerable to poverty, inequality and social exclusion, constituting a major obstacle to economic and social development for any country says the ILO in its flagship report which provides an inventory of social protection worldwide—covering the state of benefits for maternity, unemployment, old age, healthcare, etc.

However, social protection has markedly advanced in all regions of the globe, with Timor-Leste proving to be an especially good example of what is possible even with limited resources.

Despite being one of the youngest countries in the world, and one of the poorest in the region, Timor-Leste outperforms many of its wealthier neighbours in social protection coverage. The coverage of older persons, which is nearly 100 per cent for persons above 60, matches European performance, and is almost double Asia and the Pacific’s regional average of 55 per cent. Persons with severe disabilities are also better covered in Timor-Leste. 21 per cent of them get social protection, whilst in the region only 9 per cent are protected.

Universal programmes have been key to yielding such good results; both groups are serviced by a universal social pension. In contrast, targeted programmes have achieved smaller coverage – Bolsa da Mãe, a conditional cash transfer for vulnerable households with children, reaches only 30 per cent of all children.

The region’s social protection deficiencies have been attributed to insufficient investments. Despite its limited and heavily oil-dependent economy though, Timor-Leste has systematically made significant public investments in social protection, amounting to about 15 per cent of the State budget of 2017. A tangible effect is that poverty fell from 51 per cent (2007) to 42 per cent (2014) of the population.

Despite these advances, Timor-Leste still faces many challenges in its social development. Nuno Cunha, ILO’s Social Protection specialist, explained, “The investments in social protection often do not translate to adequate levels of protection. This is due to inequitable distribution of resources across the programmes, with some—such as pensions for veterans from the independence struggle —receiving a disproportionate share.”

Starting August 2017, the implementation of a new social contributory scheme, the first of its kind in the country, will cover both private and public sectors and provide a broader range of protection to workers and their families. One of the excepted impacts is to increase the level of protection, for instance in the case of pensioners that until now would only benefit from the universal pension. Cunha noted, “This important reform is a milestone in the development of the country’s social protection system. If successfully implemented, it will further boost Timor-Leste’s impressive profile as an example of how developing and fragile states can provide at least a base level of protection to all its citizens.”

However, employment linked protection is still very limited. Of the eight branches of social security, only four are fully anchored in legislation. No provision yet exists to assist workers without a job, despite an unemployment rate of 11 per cent, and until recently, maternity and paternity provisions were only provided by the Labour Code, with other benefits exclusive to public servants.

For further information, please contact: André F. Bongestabs, Social Protection Consultant, International Labour Organization, Dili, Timor-Leste at
bongestabsa@iloguest.org