Social protection systems key to a Just Transition to net-zero carbon emissions in Europe and Central Asia, says new ILO report

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TURIN (ILO News) – The International Labour Organization (ILO) launched its Europe and Central Asia Regional Companion Report, a timely and critical supplement to the ILO’s World Social Protection Report 2024-2026: Universal Social Protection for Climate Action and a Just Transition. This companion report provides an in-depth regional analysis of social protection systems, highlighting key developments, challenges, and priorities specific to Europe and Central Asia. The region has the highest social protection coverage worldwide but it is marked by significant diversity and persistent gaps in benefit adequacy and population coverage. 

The report arrives at a crucial moment as the region continues to grapple with the lingering effects of the COVID-19 pandemic, the ongoing conflict in Ukraine, persistent inflation driven by energy market tensions, climate change impacts, informality in labour markets, and demographic shifts. It issues a clarion call for policymakers, social partners, stakeholders, and communities to unite in forging a path toward a more equitable, resilient, and sustainable future. 

Key insights of the report   

The report examines current social protection coverage, expenditures, and emerging challenges across the region. It underscores the urgent need to  develop strong social protection floors, ensure adequate benefits, and close coverage gaps.  

Recognizing the inextricable connection between social protection and climate resilience, the report outlines a vision for adapting social protection systems to support climate mitigation and adaptation, promote sustainable livelihoods, and facilitate a just transition to a low-carbon economy. It highlights the importance of integrating climate risk assessments, strengthening disaster response, and reinforcing institutions at national and regional levels.  

Examples from the region

Examples from the region illustrate how countries are responding to climate-related shocks through social protection mechanisms. For instance, in Slovenia, households affected by the August 2023 floods were eligible for extraordinary social assistance cash benefits regardless of income, demonstrating how flexible policy tools can be mobilized quickly in emergencies. Similarly, in the Federation of Bosnia and Herzegovina, vouchers were distributed to households impacted by the 2024 floods. 

Moreover, Moldova offers a forward-looking example by explicitly linking social protection to climate adaptation in its Nationally Determined Contributions (NDCs). The country's NDC recognizes the role of social safety nets in increasing the climate resilience of rural livelihoods and integrates social protection with food security, agriculture, and disaster risk management. While still limited in scope, this strategic alignment exemplifies how social protection can be embedded in broader development and climate resilience planning.  

Drawing on examples from countries in the region, including EU policies, the report advocates for strengthened taxation systems and innovative financing solutions to expand fiscal space so as to maintain or increase public expenditure on social protection. It also emphasizes investing in the administration and management of social protection schemes to deliver quality services locally.  

Recommendations 

• Extending social protection to all workers: Many workers in informal, part-time, temporary, and platform jobs remain unprotected. Universal coverage aligned with international social security standards is essential to reduce vulnerabilities and enhance resilience against climate and life-cycle risks.
• Climate-responsive social protection systems: Social protection can play a vital role in supporting workers and communities affected by climate change by providing income security, healthcare, retraining, and facilitating transitions to green jobs.
• Sustainable financing: Fossil fuel subsidies currently consume 18.6 per cent of the region’s GDP, while the financing gap for universal social protection stands at only 1.9 per cent of GDP. Reallocating these subsidies towards social protection is a promising avenue for sustainable financing.
• Health and long-term care investment: Universal health coverage and equitable long-term care services are foundational for climate resilience and social inclusion. The report stresses prioritizing investments in healthcare systems and social health protection benefits that respond to climate-induced health risks.
• Policy coordination and social dialogue: Aligning social protection with national climate strategies, including  NDCs, require enhanced inter-ministerial coordination and active involvement of social partners to ensure climate action supports decent work and social justice.
• Institutional strengthening and data integration: Building climate-resilient social protection systems depends on robust institutions, integrated data and forecasting systems, and reliable delivery mechanisms capable of responding to both sudden disasters and slow-onset climate impacts. 

As Europe and Central Asia prepare their NDCs 3.0 submissions by September 2025, this report provides an essential roadmap for embedding climate-sensitive social protection measures into national policies to achieve just, inclusive, and sustainable transitions aligned with the UN Sustainable Development Goals and the Paris Agreement.