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Social Protection System Review (SPSR) of Cambodia... in 60 seconds

 

 


What is the Social Protection System Review of Cambodia?

 

The Social Protection System Review (SPSR) of Cambodia assesses of the current state of Cambodia's social protection system, highlights its current and future challenges and needs, and suggests a number of options for addressing them. 

 In the report, you will find:

  • analysis of Cambodia's poverty trends and dynamics
  • full diagnosis of the social protection system and its current and future challenges
  • assessment of social protection programmes' impact on poverty and inequality and their financial sustainability

 The review is part of the EU Social Protection Systems Programme (EU-SPS), co-financed by the European Union, the OECD and the Government of Finland.

 


What are Cambodians' social protection needs?

Cambodia has achieved rapid economic growth and a sharp poverty reduction over the last two decades, but a large proportion of non-poor families are at risk of falling back into poverty. Despite progress in income poverty reduction, living conditions are still harsh for Cambodians: in 2014 the multi-dimensional poverty rate was 33%, more than twice the money-metric measure.

Cambodia has a number of social insurance, social assistance and labour market programmes in place to reduce poverty and support vulnerable groups but their coverage is low and provision is highly fragmented. Social insurance does not cover all formal  workers equally and it is non-existent for those working informally. Private sector workers benefit from health insurance and injury insurance, but not from a statutory pension arrangement. On the other hand, the public sector has access to pension rights, disability and survivor benefits but health insurance provision is at a very early stage. Unemployment insurance does not exist for either group. Moreover, the current pension benefits for civil servants and the military run on a non-contributory basis, making them not financially sustainable. 

Cambodia has achieved improvements in health provision, particularly among the poor. Yet coverage gap persist. The largest programme in terms of coverage is the Health Equity Funds (HEF), which benefits at least 2 million poor and vulnerable Cambodians. However, even for those covered by HEF, non-financial barriers remain; as a result only 26% of HEF beneficiaries access public health care services.

Despite Cambodia’s progress in school enrolment, completion rates remain alarmingly low, especially in secondary school (21.1% dropped secondary school). Social assistance programmes, such as scholarships and school meals, intend to solve this problem but their impact is small. They are mostly concentrated in rural areas, they largely depend on donor support and they aren’t rigorously evaluated. Moreover, they are not complemented by interventions earlier in the life cycle to reduce maternal and child mortality rates, which are still very high compared to other countries in the region.

Technical vocational education and training (TVET) programmes are the most important labour market initiatives implemented in Cambodia. Although these have the potential to narrow the skills gap of informal sector workers, coverage is very low given the large size of the informal sector: the programmes only cover around 1.3% of the target population.


Did you know..?

Individuals frequently transition in and out of poverty in Cambodia. Between 2008 and 2010, 9% of non-poor rural households fell into poverty or extreme poverty while 50.7% of the very poor became non-poor.

 Transitions in household poverty in Cambodia

Source: Identification of Poor Households Programme (IDPoor) waves: 2008/09,2010/11 and 2013/14. IDPoor is a registry system to determine who the poor households are. It mainly captures the dynamics of rural poverty.

Note: The population observed in this graph belong to a restricted subset of the IDPoor panel sample.


Social protection provision for vulnerable groups is very limited in Cambodia. Public care facilities for the most vulnerable children, such as child workers, are being scaled back. Furthermore, there is no direct financial support for the elderly who have no alternative but to keep working. An allowance for people with disabilities exists but is not yet implemented.

 


Did you know..?

The Royal Government of Cambodia has adopted its first Social Protection Policy Framework in 2017 covering the period 2016-2025. This lays the foundation for an integrated social protection system to ensure social protection as a right for all Khmer citizens. It sets out an ambitious agenda to expand coverage and improve co-ordination between social assistance, social insurance and labour market initiatives.


What are the policy priorities to improve social protection? 

 

Expand social assistance with an emphasis on human capital

  • Establish a comprehensive scheme for early childhood development and expand scholarship programmes
  • Establish social assistance programmes in urban areas
  • Prioritise social assistance programmes over emergency interventions
  • Promote public works programmes
  • Establish an appropriate mechanism to provide income support for people with disabilities

 Establish long-term financing strategy for the SPPF

  • Develop a costed action plan for the SPPF, including timeframes and priorities
  • Integrate the long-term financing strategy for social protection within the government’s broader spending plans
  • Incorporate distributional analysis into the finance strategy

Improve existing pension schemes for greater efficiency and equity

  • Speed up the implementation of social insurance contributions by active civil servants
  • Establish a single statutory pension fund for public and private sectors
  • Establish a single forum for planning retirement arrangements for the whole population

 Promote systematisation to achieve universal health coverage

  • Expand and harmonise HEF into a national system
  • Develop the package of health services covered by HEF and include the informal sector
  • Leverage the consolidation of HEF, the extension of social health insurance and formalisation of policies

Improve the information framework for an evidence-based social protection system

  • Integrate monitoring and evaluation processes into the design of social assistance programmes and policies
  • Increase the frequency and geographic coverage of the IDPoor
  • Incorporate a social protection module within the Cambodia Socio-Economic Survey

Cambodia’s economic prospects are positive, but to ensure sustainable development, it has to mitigate the risks presented by structural transformation, climate change, large-scale migration, rapid urbanisation and an ageing population.

 

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