Fiscal Space and the Extension of Social Protection: Lessons learnt from developing countries (ESS Working Paper No. 33)

Organization(s): ILO
Author: Fabio Durán-Valverde, José Francisco Pacheco
Regions: Latin America, Southeast Asia, Southern Africa
Country: Bolivia, Botswana, Brazil, Costa Rica, Lesotho, Namibia, South Africa, Thailand
Year: 2012
Language: English
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This paper focuses on the analysis of experience in creating fiscal space for the extension of social protection. It presents the results of studies conducted in eight developing countries (Bolivia, Botswana, Brazil, Costa Rica, Lesotho, Namibia, South Africa and Thailand) that successfully extended social protection including floors for national social protection systems in recent years. The studies seek to identify the strategies that were adopted to finance the extension of social protection and how the necessary fiscal space was created.

Based on the country analyses, this paper shows that the selected countries were able to extend one or more components of their social protection systems by typically using a combination of diverse strategies to create fiscal space. It demonstrates that developing countries are able to create fiscal space to extend social protection and that investment in human development generates high returns in terms of social and economic development.