Social protection systems in many fast-growing middle-income countries in Asia and the Pacific are failing to support a large number of poor and vulnerable people, leaving them exposed to risks and unexpected difficulties like unemployment, ill health, and natural disasters, says a new Asian Development Bank study.

A few countries — Japan, South Korea, Mongolia, and Uzbekistan — have Social Protection Indexes that are higher than 0.200, meaning that they are already investing 8 per cent of their GDP on social protection programmes, says the study: ‘Social Protection Index: Assessing Results for Asia and the Pacific’.

However, spending in most middle-income countries, including Armenia, Fiji, India, Indonesia, Pakistan, the Philippines, and Samoa, remains below 3pc of GDP.

The SPI for South Asia, 0.061, is the lowest of any region. Its average GDP per capita, $1,702 in 2009, is also the lowest. The overall SPI for Pakistan is 0.047 with 0.104 in social insurance, 0.017 in social assistance, 0.012 in labour market programmes.

“There are many vulnerable groups, including women and informal sector workers, who can’t access unemployment, health or other social insurance but are also not poor enough to be eligible for social assistance such as cash transfers,” said Bart Йdes, Director in ADB Regional and Sustainable Development Department, on the release of the study.

“Government social protection programmes need to be expanded to cover this unprotected ‘missing middle,’ who are at risk of falling into poverty in the case of an economic, environmental, or health shock of some kind,” he said.

The study, which analyses government programmes providing social insurance, social assistance, and labour market support in 35 countries across Asia and the Pacific, shows varied spending patterns across income groups and sub-regions.

The study notes that because social insurance tends to dominate government social protection spending, benefits accrue disproportionately to men and non-poor. Poor and disadvantaged persons, particularly those working in the informal sector, benefit less because they lack access to social insurance. They are instead targeted by social assistance programmes that in many countries are fragmented and provide inadequate transfers.

Relatively little is being spent on labour market programmes like cash-for-work and skills development. This needs to be addressed amidst rising youth unemployment, critical skills gaps, and the disproportionate number of women who are unable to enter the formal labour market.

Areas for government attention include employment guarantee schemes to construct or rebuild basic infrastructure, skills development, and technical and vocational education and training.

Countries at various stages of development need to set their own targets, taking into account available public resources. However, governments need to accelerate the review and reform of pension schemes in view of the region’s huge informal sector and rapid aging.

Preventive social protection programmes such as micro-insurance schemes to cushion the impact of variable weather patterns and natural disasters should also be explored, the study says.

Expanding social protection coverage requires mobilisation of additional public revenue which can be secured by broadening the tax base, improving tax collection, and improving public expenditure management. Governments should also encourage private firms to contribute more to social insurance programmes. After many years of high growth, the Asia and Pacific region is in an excellent position to invest in better social protection systems that are attuned to the needs of its people.

In its conclusion, the SPI results suggest that countries in Asia and the Pacific need to expand their social protection systems and make their impact more equitable – not just for the poor but for a substantial proportion of the non-poor, but vulnerable members of their population.