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Tuesday, January 31, 2023

Social safety net to be widened – The Morning

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  • Treasury plans to increase allowances under Samurdhi

Due to the increasing cost of living amid rising inflation, the Government is considering expanding its social safety net to provide relief to low-income families and other vulnerable groups in society.

Speaking to The Sunday Morning Business, Treasury Deputy Secretary R.M.P. Rathnayake stated that they were currently planning to increase the allowances provided to Samurdhi beneficiaries and other vulnerable groups such as kidney patients, disabled persons, and the elderly.

“We are also planning to provide relief to those who are not covered under the existing social safety net programmes for at least the next three months. Thereupon we will consider how best we can address their needs,” he stated.

He explained that currently their plan was not to extend the coverage of the Samurdhi programme. Instead, the Government was seeking to identify certain vulnerable groups who had not been registered under any of the existing cash transfer programmes but who would require Government assistance in the near-term due to the prevailing conditions. 

Such identified vulnerable groups will also receive some relief from the Government under a separate programme for the next three months. 

As per data published by the Ministry of Finance in its Annual Report for 2020, Sri Lanka had spent Rs. 131.9 billion in 2020 for social safety net programmes. This included Rs. 64.1 billion for cash transfer programmes, Rs. 67.6 billion for Covid-19 relief, and Rs. 237 million for disaster assistance.

When considering the cash transfer programmes, assistance to Samurdhi beneficiaries amounted to Rs. 52.4 billion, assistance to the elderly (over 70 years of age) stood at Rs. 9.9 billion, assistance to disabled persons amounted to Rs  32.0 million, and the allowance provided for kidney patients amounted to Rs. 1.8 billion.

The Samurdhi programme is the largest social safety net programme in the country, providing cash transfers and various empowerment programmes that includes rural infrastructure, livelihood support, social development, housing programmes, and microfinance programmes through Samurdhi banks. 

Around 1.8 million households (31% of total households) have benefited under this programme, receiving monthly cash grants ranging from Rs. 420 to Rs. 3,500.  

The recent decision by the Government to expand its social safety net is a step that addresses the concerns raised by the International Monetary Fund (IMF) in its Article IV consultation report, where it highlighted that Sri Lanka’s social safety nets should be strengthened by increasing spending, widening coverage, and improving targeting in order to mitigate the adverse impacts of macroeconomic adjustment on vulnerable groups.

– By Shenal Fernando


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