Social protection situation

The National Social Protection Policy (2014) and the National Social Protection Strategy (2016) guide Ethiopia’s approach to social protection (SP). There has been progress, although the long-term financing of a life-cycle approach to SP, as suggested in the policy, remains a challenge. The Productive Safety Net Programme (PNSP) has been the referral point for SP in the country. It reaches 8 million vulnerable households with cash or food transfers, and includes a public work component focused on environmental restoration and climate resilience. A new PSNP for urban areas was launched in 2016, reaching 600,000 people in 2019.

Social insurance is available for the public and private sectors, covering the full range of pensions and work injury, although coverage is very limited (2 million private-sector workers covered). On health, there is no comprehensive working system in place, although a Community-based health insurance (CBHI) scheme has recently been implemented.

COVID-19

The government’s social protection (SP) responses to the effects of COVID-19 included a nationwide food distribution programme, waiving utility bills, and prohibiting evictions and lay-offs during the state of emergency. Nevertheless, the World Bank estimated that the employment rate dropped 3 percentage points from March to August 2020.

COVID-19 did highlight the gaps in Ethiopia’s SP system, which has no unemployment protection. The German Foreign Ministry of Economic Co-operation and Development (BMZ) is providing short-term wage subsidies for 45,000 workers in the garment sector and is sponsoring the development of a pilot unemployment insurance fund, with ILO technical support in the legal, design, and operational aspects. Ethiopia is also a priority country of the Call to Action in the Global Garment Industry, bringing brands and social partners together to catalyze short and medium-term actions to protect manufacturers and workers, including the development of sustainable SP systems.

Government priorities

• Extend social assistance programmes, particularly the Urban PNSP, and improve their long-term sustainability. Domestic resources currently fund less than 15% of both the rural and urban PSNPs. The ILO, with the support of the European Union, are supporting the Government of Ethiopia to develop a financing strategy for SP.
• Expand health coverage: the CBHI is a relatively new scheme, aimed at extending health insurance to the informal economy. It is an initial stage of development and will require technical support.
• Use social protection as a tool to increase the formalization of the workforce by progressively extending social insurance to the informal economy. The ILO is supporting this, with the support of the European Union.
• Develop an unemployment insurance fund.

• PROSPECTS - Inclusive jobs and education for refugees and host communities in Ethiopia
  28.10.2019 - 30.06.2024 USD 10,020,500 Netherlands
• Improving Synergies between Social Protection and Public Finance Management (ILO component)
  01.10.2019 - 31.05.2023 USD 11,938,812 European Union
  Display expected outcomes
  • Outcome 1: Improving the social protection system for Ethiopia through a sustainable financing strategy

Over the course of 2016-2020, ILO support has included:

• Building the capacity of 10 officials from the Ministry of Health and Social Affairs on social protection issues via an e-training by the ILO International Training Centre in Turin.
• Supporting the revival of a social protection platform that facilitates the exchange of information and practices across different implementing institutions.

Please see the list below for a complete list of ILO contributions to social protection results in Ethiopia.

• The Social Security Inquiry Tool was adopted
  ETH154 31.12.2021
• An actuarial evaluation report was adopted
  ETH154 31.12.2021
• The Federal Social Protection Platform was reactivated
  ETH154 31.10.2020
• The Ethiopian Government endorsed in August 2017 the final Report of the Reform of Pension System in Ethiopia: actuarial, legal and public finance review and implications.
  ETH999 01.08.2017
• National Social Protection Policy of Ethiopia developed and adopted by cabinet (Nov/Dec 2014).
  ETH154 31.12.2015
• Generated social security statistics which are publicly available.
  ETH154 31.12.2015
• The Policy was developed through active participation of the Social Partners who are members of the National Social Protection Platform.
  ETH154 31.12.2015
• The National Social Protection Policy of Ethiopia intends to provide non-contributory insurance for old age.
  ETH154 31.12.2015
• National Social Protection Policy of Ethiopia developed and adopted by cabinet (Nov/Dec 2014).
  ETH999 31.12.2014
• Ethiopian Labour Union Confederation and Ethiopian Employers’ Federation participated in development of tripartite policy guidelines
  ETH154 31.12.2009
• Ethiopian Horticulture Producers and Exporters Association included OSH issues into its code of practice
  ETH154 31.12.2009

In light of COVID-19, there has been a large mobilization of funds for short-term measures for workers, most notably through wage subsidies in the garment and tourist sectors. It will be important to use this impetus to plan long-term measures, including unemployment insurance, that are part of a sustainable social protection system. International brands in the garment industry, for example, can work with national employer organizations to increase the coverage and compliance of garment manufacturers within the social security system.

• Ethiopia: Ethiopia’s social safety net effective in limiting COVID-19 impacts on rural food insecurity
  22.09.2021
• Ethiopia: Ethiopia Prohibits Company Layoffs Under State of Emergency
  28.01.2021
• Ethiopia: Ethiopia Live Updates
  28.01.2021
• Ethiopia: Ethiopia avails $154 million to combat COVID-19
  28.01.2021
• Ethiopia: March 16: Ethiopia’s COVID-19 rules: Crowd ban, free transport, regulate essentials etc.
  28.01.2021

See all

• Protecting Garment Sector Workers: Occupational Safety and Health and Income Support in Response to the COVID-19 Pandemic
  28.01.2022