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Family card can have significant anti-poverty impact as the programme if properly targeted would reduce Bangladesh's overall poverty rate by 7.4 percentage points, according to a RAPID study.
The newly-elected government recently introduced the piloted family card programme that offers Tk 2,500 monthly to more than 6500 vulnerable households in 14 upzilas aiming to boost food security and income.
The government plans to gradually expand the programme to 20 million households and raise social protection spending to 3.0 per cent of GDP by 2028.
Simulations using HIES 2022 data suggest that providing Tk 2,500 per month to all poor and vulnerable households through the Family Card would significantly reduce poverty and vulnerability, according to it.
"Overall poverty would decline from 18.7 per cent to 11.3 per cent--a 7.4 percentage-point reduction, while extreme poverty would fall from 5.6 per cent to 2.2 per cent -- down 3.4 percentage points," Dr MA Razzaque, chairman of Research and Policy Integration for Development (RAPID), said on Thursday.
He was presenting the findings titled "The family card initiative: A potential game changer for poverty and vulnerability reduction and social protection reform in Bangladesh" at a roundtable moderated by RAPID executive director Dr M Abu Eusuf at a city hotel.
The vulnerable population would decrease from 15.3 per cent to 5.9 per cent, a reduction of 9.4 percentage points or about two-thirds, he said.
In absolute terms, if all poor and vulnerable households are covered under the scheme, the Family Card would lift 12.3 million people out of poverty and reduce the extreme poor by 5.6 million, he further said.
Currently, 56.4 million people are below the vulnerability line. If all households in this category receive Family Card, this number will reduce to 40.8 million, the RAPID chairman said.
Reversal in poverty reduction gains underscores the need for Family Card-type interventions, he explained, adding persistently high inflation, weak economic activity, and the widening gap between wages and living costs have eroded real incomes and weakened the resilience of low-income households.
The absence of a predictable, poverty-targeted income support pillar has become both more visible and more consequential while the existing system has evolved in a way that more than half the poor and vulnerable households receive no benefit at all.
"Strong political commitment with extreme limited fiscal space is indispensable for developing a modern and effective social protection system, including social insurance schemes for workers," he said.
Speaking on the occasion, Dr Mohammad Abu Yusuf, secretary at the ministry of social welfare, said they would take care of the concerns including targeting, fiscal space, data accuracy raised at the roundtable.
Talking about the target, he said it was not an issue as the government was collecting data through PMT (proxy means testing).
Terming data collection and coordination as challenging, he explained that they received complaints that one family received cards who own a three-storied building and the government was reviewing it.
Shah Mohammad Mahbub, director general of Department of Social Services, said the non-economic impact of the amount was huge including public trust and confidence on government.
Speakers also stressed data availability, consolidation among existing social protection schemes, reducing inclusion errors, role of NGOs in selection and verification process of data, standard workers' database, saying social protection agenda cannot be implemented without good worker database.
RAPID suggested considering family card as a potential anchor for a more coherent and effective social protection framework and positioning it carefully to avoid deepening of fragmentation and intensification of fiscal pressure.
munni_fe@yahoo.com