How can a social pension underpin an economic development strategy?

Fresh evidence on the impact of social pensions on local economies is contained in a new report published by the Government of Uganda this week. The report is published ahead of a London event on Making the Case for Social Protection with Ugandan MPs.

Screen Shot 2017-11-20 at 16.09.35The report, published by the Ministry of Gender, Labour & Social Development and the Expanding Social Protection programme, reviews evidence on how social pensions help  expand local economies. It says that a number of studies “have shown that social protection transfers generate multipliers of between 1.3 and 2.4 for the cash entering communities”. This means the size of the benefit can be more than double the cost.

A study in Kiboga and Kyenjojo, the report, authored by Stephen Kidd and Anh Tran, adds, found “almost every store owner reporting that business had improved after the introduction of the SCG”. While another study “found similar impacts, with small businesses consistently increasing their turnovers and profits”. This lead to both outside traders and shopkeepers from the community gathering at pay points on payday and recipients making immediate purchases of soap, beans, oil, sugar, salt, and clothing as well as ‘luxury’ items such as meat.

The evidence of traders from other areas travelling to SCG communities to sell their goods, for example, in Kisojo in Kyenjojo, traders travelled from the neighbouring district of Mubende. The increased competition “may be the reason why there is no evidence of the SCG leading to a rise in inflation”.

Ugandan MPs will set out the achievements of the Senior Citizen’s Grant and discuss making the political case for investing in pensions in London on 29th November. For more information and to book, click here.

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