Ministry of Labor and Social Affairs, UNICEF, the World Bank and the EU Present the Core Diagnostic of the Social Protection System and the Impact of COVID-19 on Households in Armenia

YEREVAN, 25 May 2021 – Two new assessments were released today by the Ministry of Labor and Social Affairs, UNICEF, the World Bank and the EU, presenting the core diagnostic of the social protection system and the impact of COVID-19 on households in Armenia.

The core diagnostic of the social protection system (CODI) was conducted by UNICEF Armenia and the World Bank, jointly with the Ministry of Labor and Social Affairs, offering a comprehensive overview and analysis of the performance of the social protection system in 2019-2020 against national social protection objectives and international best practice benchmarks. COVID-19 Armenia High Frequency Survey was conducted in September 2020 by the World Bank and UNICEF Armenia with the financial support of the European Union, looking at the impact of COVID-19 on household welfare in Armenia and the Government response.

“The CODI assessment underlines the importance of strengthened social protection and sustained social spending to ensure sound protection of children and their families. This is particularly valid under the impact of COVID-19 and Nagorno-Karabakh conflict,” said Yuri Oksamitniy, UNICEF Representative in Armenia. “Many of the CODI recommendation findings have already been incorporated into the draft labour and social protection strategy, including introduction of life-cycle approach, international definition of social protection, and increased coverage of vulnerable groups. UNICEF works with the relevant line Ministries and partners to develop Armenia’s rapid assessment and response system.”

The CODI assessment focuses on three of the four pillars of social protection – social assistance, active labour market programs and social care services, reviewing 115 social protection programmes, including across health, education and justice sectors. The report highlights the strengths and weaknesses of the system and the programs, with an in-depth look at 15 programmes that have large coverage, strong linkage to current reforms and high vulnerability of beneficiaries. The latter include eight cash transfer, five labor market, and two care services.

“From a long-term perspective, the report highlights the importance of increased coverage of social assistance, while ensuring that work incentives are in place. The findings from the report also come at an opportune time, as Armenia is still grappling with the effects of the COVID-19 pandemic, as well as the recent Nagorno Karabakh conflict. Large segments of the population have been affected, and while the Government has been quick and effective in its response, there are still adaptations to be made, including the integration of information systems on social protection services and programs, for which we continue to provide support along with our development partners,” said Sylvie Bossoutrot, World Bank Country Manager for Armenia.

The CODI assessment found the strongest areas of the Armenian social protection system to be governance and institutional capacity. The assessment also found three major areas for improvement:

1. limited coverage of the population across the life cycle: while the government demonstrated its capacity to mobilize resources and design over 20 emergency response programs in the first month of the pandemic, policy makers should further look at how to close some important gaps and exclusion errors among the extreme poor, children aged 2-3, and those working in the informal sector;
2. low funding for social protection: the social protection needs across the country are not met by existing network of services and level of benefits;
3. labor market incentives: low salaries and fear of losing privileges linked to eligibility for social assistance benefits disincentivize people from accessing formal employment.

241,442 people or 18 per cent of working-age people who had jobs before COVID-19 lost them due to the pandemic. The largest share of this is amongst unregistered and female workers. COVID-19 Armenia High Frequency Survey results point to a high correlation between job and income loss and food insecurity and mental wellbeing.

“We appreciate the opportunity today to  partner with UNICEF and World Bank in the public presentation of these important studies on Armenia’s Social Protection System and the Impact of COVID-19 on Households in the country. It is clear that the Covid-19 pandemic and the Nagorno-Karabakh conflict are having an enormous impact on the Armenian society and households and that women and children are particularly affected. The EU is closely working with the Armenian authorities and civil society organisations to jointly address such hardship situation. In that context, the EU is dedicating its core 2021 assistance budget to Armenia to support the socio-economic recovery and the reform agenda in line with CEPA, including on modernizing the social protection and social investment systems. It is our hope that working together we can definitely strengthen people and businesses’ resilience to crises”, said Mr. Gonzalo Serrano, Head of Cooperation, EU Delegation to Armenia.

Children are the hidden victims of the pandemic as they were also disproportionally affected by COVID-19. Internet access had an important impact on distance learning outcomes among the school-age children, with lower connectivity and lower participation in rural areas, especially in Aragatsotn, Armavir, Gegharkunik, Tavush, and Syunik. Fifteen per cent of households have delayed or skipped routine immunization because of the pandemic.

The assessments also point out to the need to interconnect and harmonize, as well as improve the information technology systems of the line Ministries, in order to better identity and target the affected populations, including efficiently distribute relief and make the social safety nets in the country more shock responsive.