Egyptian social protection policies in response to the COVID-19 pandemic... considerable efforts with limited impact
This is the English edition of the EIPR research paper titled "Egyptian social protection policies in response to the COVID-19 pandemic... considerable efforts with limited impact", which was published in Arabic language last October.
This research paper is part of the project Promoting Resilience in COVID-19 in MENA: Building Inclusive and Effective Social Protection and Safety Nets. This project focuses on analyzing the impact of the pandemic on vulnerable and promoting inclusive and effective social protection and safety nets during and post-COVID-19 in Egypt, Jordan, Lebanon, and Tunisia.
The paper issued by EIPR today looks into existing social protection policies and those developed due to the pandemic, by monitoring and analyzing health protection policies, labour policies, wages and insurance policies and their response to the repercussions of the economic slowdown caused by COVID. The study also monitors the financial and monetary measures applied by the state to ease the burden of livelihood on individuals or to ease the severity of the crisis on the business community.
Despite the prompt response of the state to the COVID pandemic and its effectiveness in some aspects, the crisis has shown the fragility of health infrastructure in Egypt. This could be seen in terms of the limited number of beds relative to the population, the absence of primary care systems to detect the disease at an early stage, and the lack of intensive care beds, which are a basic necessity to confront advanced cases infected by COVID-19.
The urgent policies that were introduced to confront the repercussions of COVID were not based on clear foundations to target the lowest income sectors of the population and ensure the provision of services to them, as the paper explains.
The COVID crisis revealed the government’s inability to impose a price ceiling for treatment services provided by the private sector, which made the crisis an opportunity to reap profits, and created a great pressure on the Covid-infected cases in light of the spread of the pandemic and the inability of the limited services provided by public hospitals to meet the needs of all those who needed them.
The pandemic also sheds light on the deterioration of the conditions of the Egyptian labour market, in light of the domination of informal jobs, which are deprived from the minimal forms of protection during the pandemic. This situation contributed to loss of jobs for many families or reduction for their income, due to the economic slowdown.
The officially employed workers had a different type of problems. The private sector was not obligated by governmental measures to bear the cost of reducing the number of workers present in the workplace to prevent the transmission of infection. It was neither obliged to provide paid vacations for some vulnerable groups, such as pregnant women, who were most at risk of infection, or mothers caring for children who had no alternatives for childcare while nurseries and schools were closed due to the pandemic. Meanwhile, the state committed itself to those policies towards workers in the governmental sector.
Public spending directed to mitigate the economic and social repercussions of the COVID pandemic was limited on one hand, and it favored the business community rather than the health infrastructure and vulnerable groups, on the other.
When the state allocated more than 100 billion pounds, as part of a package of policies that it said were directed at reducing the repercussions of COVID, more than half of this expenditure was directed to supporting the business community and economic activities, while the doctors continued to have poor salaries. Forms of direct cash transfers to the poorest such as Takaful and Karama pensions were relatively stagnant in their amounts during this period.
International finance focused on supporting small and medium-sized enterprises and the tourism sector. That was positive due to the employment-intensive nature of these sectors. However, this finance was not linked to protecting the rights of workers in these facilities during the crisis.
Finally, facing the the crisis depended mainly on the tools of the Central Bank, such as the initiatives to postpone the payment of personal loans and to facilitate real estate financing, but the scope of these policies remained limited to groups capable of dealing with the banking sector, as the research paper explains, and could not substitute for the deficit in social protection policies.
The research paper recommended a number of policies and procedures that would maximize the state’s resources and ability to confront health and social crises of this magnitude, in a more comprehensive manner:
* Greater investments in the field of public health services is a priority, to provide a less costly service for the lowest-income groups,to provide an affordable alternative for the private sector health services, for which the state was unable to set a price ceiling at the time of crisis. The additional spending should focus on improving doctors’ wages, aiming to fill the deficit in many important cadres required to confront pandemics, especially intensive care doctors. As well as spending on the expansion of ICU beds in government hospitals.
* The need to increase spending on primary care services in order to improve Egyptian health indicators as regards the spread of non-communicable diseases and malnutrition, which helps to raise immunity levels in times of pandemics.
* The need to develop new labour legislations to keep pace with the conditions of pandemics, obligating the private sector to bear the costs of workers’ wages and to allow employees to be absent or work from home during times of pandemics.
* The need to work towards reducing the growth of the informal labour market, and build a more advanced database about workers without legal contracts, to ensure their protection during times of crises.
* Establishing a clear mechanism to ensure increasing monetary support (directed to Takaful and Karama pensions or food support) to keep pace with the economic pressures produced by major events such as pandemics, and to be proportional to annual inflation rates.
* Announcing more detailed data on the extent to which unemployment compensation is applied in the Egyptian labour market, providing social spending data in general in a more transparent manner, in addition to facilitating procedures of applying for unemployment compensation in line with working conditions in Egypt.
* The use of monetary policies to support the business community at the time of a crisis was a positive trend, but it must be accompanied by strong policies to protect the rights of workers, in order to ensure that the fruits of economic growth fall in sectors that enjoy the support of central bank funds.
* Working for the state is still the preferred destination for women in Egypt, given the weak guarantees to protect their rights when working in the private sector. In circumstances such as the COVID pandemic, women’s problems at work increased, given the exacerbation of policies of discrimination against them regarding employment opportunities and wages, as a result of the crisis. The crisis added increasing complexities for working mothers regarding leave policies in the private sector that does not take into account the exceptional circumstances, which included the closure of schools and nurseries. There is a need to put in place clearer policies on protecting the rights of female workers in the private sector during times of pandemics.
* It is important to integrate civil society in designing policies to confront major crises, such as the COVID pandemic, in a way that provides a more comprehensive and expressive view of reality to the decision maker, and enables civil society to contribute to bridging the existing gaps.