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.

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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.

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