ILO Georgia

X Assessment of the
Social Protection System

in Georgia
Final Report
Photo: ILO/David Mdzinarishvili
X Assessment of the
Social Protection System
in Georgia
Final Report
This assessment has been commissioned by the International Labour Organization (ILO) in cooperation with UN Women,
with in-kind contributions from the Ministry of Foreign Affairs of Denmark (DANIDA), Swiss Agency for Development and
Cooperation (SDC) and the Austrian Development Cooperation (ADC). The assessment was coordinated by the ILO project
"Inclusive Labour Market for Job Creation in Georgia" and through the UN Women regional project “Women’s Economic
Empowerment in the South Caucasus”.
Copyright © International Labour Organization 2020
First published 2020
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X Contents iii
X Contents
Acknowledgements.....................................................................................................................................................viii
Abbreviations and acronyms......................................................................................................................................ix
Foreword..........................................................................................................................................................................xi
Executive summary........................................................................................................................................................1
1 Introduction...............................................................................................................................................................9
2 Understanding Georgia’s social protection system within a lifecycle framework...................................11

2.1 A lifecycle approach to social protection..................................................................................................11
2.2 The role of social protection “floors” within a national social security system................................14
2.3 Overview of Georgia’s social protection system....................................................................................17
2.3.1 Comprehensiveness of the system in relation to international standards...........................18
2.3.2 Reliance on poverty targeting to fill gaps left in lifecycle provision.......................................21
2.3.3 Spending on social protection.........................................................................................................26
2.4 Governance and administration................................................................................................................ 28
2.4.1 Institutional arrangements............................................................................................................. 28
2.4.2 Administration and accountability................................................................................................ 30
2.5 Summary........................................................................................................................................................ 34
3 Social protection for children in Georgia.......................................................................................................... 35

3.1 Context and overview of benefits for children....................................................................................... 35
3.1.1 High child poverty, but low spending on child benefits........................................................... 35
3.1.2 Key social protection schemes aimed at children...................................................................... 38
3.2 Legal coverage of children.......................................................................................................................... 39
3.3 Effective coverage of children.....................................................................................................................41
3.3.1 Horizontal coverage.......................................................................................................................... 42
3.3.2 Vertical coverage (adequacy)...........................................................................................................49
3.4 Summary........................................................................................................................................................ 53
4 Social protection for people of working age in Georgia............................................................................... 55

4.1 Context and overview of benefits for working-age people................................................................ 55
4.1.1 High informality and unemployment, especially among younger people........................... 55
4.1.2 Key social protection schemes aimed at working-age people.................................................57
4.2 Legal coverage of the working-age population..................................................................................... 60
4.3 Effective coverage of the working-age population............................................................................... 63
4.3.2 Vertical coverage (adequacy)...........................................................................................................69
4.4 Summary.........................................................................................................................................................74
iv X Assessment of the Social Protection System in Georgia
5 Social protection for older people in Georgia..................................................................................................76

5.1 Context and overview of benefits for older people...............................................................................76
5.1.1 Low poverty but many still at risk...................................................................................................76
5.1.2 Key social protection schemes aimed at older people.............................................................. 78
5.2 Legal coverage.............................................................................................................................................. 78
5.3 Effective coverage.........................................................................................................................................81
5.3.1 Horizontal coverage...........................................................................................................................81
5.3.2 Vertical coverage (adequacy).......................................................................................................... 84
5.4 Summary.........................................................................................................................................................92
6 Access to health care across the lifecycle in Georgia..................................................................................... 95

6.1 Legal coverage.............................................................................................................................................. 95
6.2 Effective coverage........................................................................................................................................ 95
6.2.2 Vertical coverage (adequacy).......................................................................................................... 98
6.3 Summary...................................................................................................................................................... 101
7 Social protection and women and girls in Georgia: A summary of initial findings............................... 102
7.1 Children......................................................................................................................................................... 102
7.2 Working-age people................................................................................................................................... 102
7.3 Older people................................................................................................................................................ 104
8 Towards an inclusive lifecycle social protection system in Georgia......................................................... 105

8.1 Overall performance of the existing system........................................................................................ 105
8.2 Closing the gaps in Georgia’s social protection floor......................................................................... 108
8.3 Additional measures to consider for a more equitable system........................................................114
8.4 Summary.......................................................................................................................................................115
9 Conclusions............................................................................................................................................................116
Annex 1 Summary of legal and effective coverage of lifecycle schemes in Georgia...............................117

Annex 2 Additional (non-lifecycle) schemes.....................................................................................................119
Annex 3 Notes on new employment injury scheme...................................................................................... 120
Annex 4 Description of UHCP services and user charges............................................................................. 122
References................................................................................................................................................................... 124
X Contents v
BOXES
Box 2.1: Gender sensitivity in individual- versus household-level benefits ..........................................13
Box 2.2: Multi-tiered systems for universal coverage.................................................................................15
Box 2.3: Oscillating models for burden sharing in Georgia.......................................................................21
Box 2.4: Poverty and income dynamics........................................................................................................ 23
Box 2.5: Targeted Social Assistance and the Child Benefit Programme in Georgia............................ 25
Box 2.6: Social dialogue in the governance of social protection systems............................................. 30
Box 3.1: Protecting children’s rights in Georgia.......................................................................................... 38
Box 3.2: Setting child benefit values according to benefit objectives.....................................................49
Box 4.1: The link between disability and poverty........................................................................................61
Box 4.2: Overview of maternity, paternity and parental leave protections around
the world.............................................................................................................................................. 72
Box 5.1: A primer on choices in pension design.......................................................................................... 90
Box 5.2: Measures to mitigate gender inequalities in pension systems.................................................91
Box 8.1: The Government’s recently announced social protection response to COVID-19............. 109
FIGURES
Figure 0.1: Key lifecycle risks in Georgia relative to ILO Convention No. 102...............................................1
Figure 0.2: Percentage of children receiving the CBP, by consumption decile, 2018..................................2
Figure 0.3: Percentage of the registered disabled population receiving a Social
Package disability benefit or an old-age pension, 2018 ...............................................................4
Figure 0.4: Percentage of older persons receiving the TSA, by select background
characteristics, 2018 ............................................................................................................................5
Figure 0.5: Median monthly household expenditure on health care as a percentage
of monthly household consumption expenditure, by consumption decile, 2018 .................7
Figure 1.1: Percentage of the population living in poverty, by different national
measures, 2004–2018...........................................................................................................................9
Figure 2.1: Key risks across the lifecycle.............................................................................................................11
Figure 2.2: Lifecycle benefits specified under ILO Convention No. 102 ......................................................12
Figure 2.3: Depiction of ideal pension systems with universal (left) or pension-tested
(right) tier 1............................................................................................................................................15
Figure 2.4: Multi-tiered disability benefits system...........................................................................................16
Figure 2.5: Percentage of the population receiving at least one social protection benefit,
by age group and sex, 2018 ..............................................................................................................18
Figure 2.6: Comprehensiveness of Georgia’s social protection system relative to lifecycle
risks under ILO Convention No. 102 ...............................................................................................19
Figure 2.7: Percentage distribution of social protection recipients, by programme, 2018.................... 20
Figure 2.8: Percentage of the Georgian population with per capita consumption
below international poverty lines, 2018........................................................................................ 22
Figure 2.9: Distribution of central government expenditures, by function, 2018.....................................26
Figure 2.10: Evolution of central government expenditures, by function, 2002–2018.............................. 27
Figure 2.11: Composition of social protection budget, central government outlays, 2018...................... 27
Figure 2.12: Governance and administrative structure of Georgia’s social protection system .............. 28
Figure 2.13: Reasons for not applying for assistance from the SSA, by quintile, 2018 ............................. 33
Figure 3.1: Percentage of the population living in relative poverty (below 40 per cent and
60 per cent of median equivalized household consumption), by age group, 2018............. 35
Figure 3.2: Child poverty rates and public spending on child/family cash benefits and tax
breaks for children, OECD countries, 2015 or latest year available......................................... 36
vi X Assessment of the Social Protection System in Georgia
Figure 3.3: Spending on family (cash) benefits in OECD countries (2015) and Georgia (2019)
(percentage of GDP)........................................................................................................................... 37
Figure 3.4: Spending on child (cash) benefits in select low- and middle-income countries
(percentage of GDP)........................................................................................................................... 38
Figure 3.5: Percentage of children aged 0–15 receiving the CBP, by consumption decile...................... 43
Figure 3.6: Evolution in the numbers of children receiving the CBP versus the number of
TSA-recipient households................................................................................................................. 43
Figure 3.7: Percentage of children aged 0–15 receiving the CBP, by age, 2018......................................... 44
Figure 3.8: Percentage of children aged 0–15 receiving the CBP, by age, 2018......................................... 45
Figure 3.9: Gender make-up of CBP and TSA beneficiaries, 2018 (percentage)........................................ 45
Figure 3.10: Percentage of the population aged 0–15 receiving a child disability benefit
(Social Package), by per capita consumption decile.................................................................... 46
Figure 3.11: Percentage of children receiving the survivors’ benefit (Social Package),
by age, 2018..........................................................................................................................................47
Figure 3.12: Percentage of children receiving survivors’ benefits, by region, 2018................................... 48
Figure 3.13: Trend in the number of children receiving survivors’ benefits, 2012–2019........................... 48
Table 3.3: Minimum adequate child benefit levels in Georgia according to C102 ................................. 50
Figure 3.14: Comparison of per-child benefit values around the world, latest year available
(percentage of GDP per capita) .......................................................................................................51
Figure 3.15: Child disability benefit transfer values in select countries, latest year available
(percentage of GDP per capita)........................................................................................................52
Figure 4.1: Share of informal employment in total non-agricultural employment, 2017 and
2018............................................................................................................................................................
Figure 4.2: The disability and poverty cycle.......................................................................................................61
Figure 4.3: Percentage of people registered as disabled receiving a disability benefit under
the Social Package or the old-age pension, by age, 2018.......................................................... 65
Figure 4.4: Percentage of population assessed as disabled receiving a disability pension
(Social Package), by disability status, 2018.................................................................................... 66
Figure 4.5: Percentage distribution of disability benefit recipients under the Social Package,
by sex, 2018...........................................................................................................................................67
Figure 4.6: Total number of private-sector maternity benefits paid by the SSA, 2011–2019................. 68
Figure 4.7: Comparison of tax-financed disability benefit values around the world,
latest year available (percentage of GDP per capita)...................................................................71
Figure 5.1: Percentage of the population living in relative poverty (below 40 per cent
and 60 per cent of median equivalized household consumption), by age and
sex, 2018 .............................................................................................................................................. 77
Figure 5.2: Percentage of the population over age 60 (women) or age 65 (men) receiving
the universal old-age pension, 2018 .............................................................................................81
Figure 5.3: Percentage of the population over age 60 (women) or age 65 (men) receiving
the universal old-age pension, by ethnic background, 2018 ................................................... 82
Figure 5.4: Gender distribution of universal old-age pension recipients, 2018 (percentage)................ 83
Figure 5.5: Value of the social pension adjusted for inflation and expressed in 2020 prices,
1999–2020............................................................................................................................................ 84
Figure 5.6: Comparison of tax-financed old-age pension values in select middle-income
countries, latest year available (percentage of GDP per capita).............................................. 86
Figure 5.7: Comparison of tax-financed old-age pension values in select high-income
countries, latest year available (percentage of GDP per capita).............................................. 87
Figure 5.8: Percentage of older people (aged 65+) receiving the TSA, by sex, marital status
and special status............................................................................................................................... 88
Figure 6.1: Percentage of the population covered by health insurance, by type of insurance
(broad) and age group, 2018.............................................................................................................97
X Contents vii
Figure 6.2: Distribution of health insurance, by type of insurance (detailed),

2018 (percentage)................................................................................................................................97
Figure 6.3: Percentage of the population with health insurance, by age, 2018........................................ 98
Figure 6.4: Out-of-pocket medical spending as a share of final household consumption,
2015 or latest year available............................................................................................................. 99
of monthly household consumption expenditure, by consumption decile, 2018.............. 100
of monthly household consumption expenditure, by region, 2018...................................... 100
Figure 8.1: Average income from social protection transfers as a share of total household
income, by age, 2018....................................................................................................................... 106
Figure 8.2: Average income from social protection transfers as a share of total household
income, by decile groups of the population, 2018.................................................................... 106
Figure 8.3: Simulated share of the population living below the relative poverty line
(60 per cent of median equivalized household consumption) before and after
receiving income from social protection transfers, by age, 2018.......................................... 107
TABLES
Table 2.1: Percentage of population living in a household with at least one member
who receives transfers according to type of scheme, by age group, 2018............................ 24
Table 2.2: Summary of parameters of the TSA and the CBP....................................................................... 25
Table 3.1: Lifecycle social security schemes for children in Georgia ........................................................ 40
Table 3.2: Percentage of children legally covered by three main lifecycle schemes
in Georgia............................................................................................................................................. 42
Table 3.3: Minimum adequate child benefit levels in Georgia according to C102...................................47
Table 3.4: Adequacy of survivors’ benefit (Social Package) relative to C102 standards ....................... 53
Table 3.5: Summary of legal and effective coverage of children in Georgia............................................ 54
Table 4.1: Lifecycle social security schemes for people of working age in Georgia ...............................59
Table 4.2: Number of women in the labour force, by employment status, 2018 ................................... 62
Table 4.3: Number of workers in the labour force, by employment status, 2018................................... 63
Table 4.4: Percentage of working-age people legally covered by lifecycle schemes
in Georgia............................................................................................................................................. 64
Table 4.5: Minimum adequate disability benefit levels in Georgia according
to C102 and C128.................................................................................................................................69
Table 4.6: Adequacy of maternity benefits in Georgia relative to ILO standards
(based on monthly reference earnings of GEL 822.60 )............................................................. 72
Table 4.7: Adequacy of cash sickness benefits in Georgia relative to ILO standards............................ 73
Table 4.8: Summary of legal and effective coverage of the working-age
population in Georgia ........................................................................................................................75
Table 5.1: Lifecycle social security schemes for older people in Georgia ................................................ 79
Table 5.2: Percentage of older people legally covered by lifecycle social security
in Georgia............................................................................................................................................. 80
Table 5.3: Minimum adequate social pension levels in Georgia according
to C102 and C128................................................................................................................................ 85
Table 5.4: Summary of legal and effective coverage of older people in Georgia................................... 94
Table 6.1: Health-care benefits across the lifecycle in Georgia.................................................................. 96
Table 8.1: Estimated annual programme costs, 2020..................................................................................112
viii X Assessment of the Social Protection System in Georgia
X Acknowledgments
This report was prepared for the International Labour Organization as part of the project “Inclusive
Labour Market for Job Creation in Georgia” funded by the Government of Denmark (DANIDA) and the UN
Women regional project “Women’s Economic Empowerment in the South Caucasus” funded by the Swiss
Agency for Development and Cooperation (SDC) and the Austrian Development Cooperation (ADC). It was
coordinated by Jasmina Papa, Social Protection Specialist, ILO Decent Work Technical Support Team and
Country Office for Eastern Europe and Central Asia in Moscow, with additional technical support funded
by UN Women Georgia. The lead author of the report is Shea McClanahan (Development Pathways);
Bjorn Gelders (Development Pathways) conducted the analysis of the Integrated Household Survey and
Labour Force Survey; Madeleine Cretney (Development Pathways) provided valuable inputs and research
support; and Salome Kajaia (national expert) provided technical backstopping and acted as liaison with
national organizations. The authors are grateful to the ILO Decent Work Technical Support Team and
Country Office for Eastern Europe and Central Asia in Moscow and the UN Women Country Office in
Georgia for providing valuable technical feedback on multiple drafts, as well as to the ILO Project Office
in Georgia for providing essential logistical support and overall guidance throughout the project.
The ILO and UN Women would like to extend their appreciation to the Ministry of IDPs, Labour, Health
and Social Affairs, Social Services Agency, Pension Fund, National Statistics Office (Geostat), Georgian
Trade Unions Confederation (GTUC), Georgian Employers Association (GEA), Public Defender Office
(Ombudsman Office) and UNICEF Georgia - their collaboration over years and during the course of this
particular assessment was invaluable. We hope that this report’s suggestions for strengthening national
social protection floor will jointly be taken further and realised through different interventions, policies
and legislation.
X Abbreviations and acronyms ix
X Abbreviations and acronyms
AFL-CIO American Federation of Labor and Congress of Industrial Organizations

CBP Child Benefit Programme
C102 ILO Social Security (Minimum Standards) Convention,1952 (No. 102)
C128 ILO Invalidity, Old-Age and Survivors’ Benefits Convention, 1967 (No. 128)
C130 ILO Medical Care and Sickness Benefits Convention, 1969 (No. 130)
C183 ILO Maternity Protection Convention, 2000 (No. 183)
DB Defined Benefit
DC Defined Contribution
GDP Gross Domestic Product
GEL Georgian lari
Geostat National Statistics Office of Georgia
IDA International Disability Alliance
IDP(s) Internally Displaced Person(s)
IHS Integrated Household Survey
ILO International Labour Organization
IMF International Monetary Fund
ISSA International Social Security Association
ISSA/SSA ISSA and the Social Security Administration of the United States
LFS Labour Force Survey
Ministry of IDPs Ministry of Internally Displaced Persons from the Occupied Territories, Labour,
Health and Social Affairs
MISSOC Mutual Information System on Social Protection
NDC Notional Defined Contribution
NEET Not in Education, Employment or Training
OECD Organisation for Economic Co-operation and Development
PMT Proxy Means Test
PPP Purchasing Power Parity
R191 ILO Maternity Protection Recommendation, 2000 (No. 191)
R202 ILO Social Protection Floors Recommendation, 2012 (No. 202)
SEDP Social-Economic Development Plan
SSA Social Service Agency
TSA Targeted Social Assistance Programme
UHCP Universal Health Care Programme
x X Assessment of the Social Protection System in Georgia
UN United Nations
UN DESA United Nations Department of Economic and Social Affairs
UN Women United Nations Entity for Gender Equality and the Empowerment of Women
UNICEF United Nations Children’s Fund
WHO World Health Organization
X Foreword xi
X Foreword
The assessment of a social protection system in the Republic of Georgia carried out at the outset of
the COVID-19 global pandemic reiterates the importance of national social protection floors to protect
people in case of different risk across the lifecycle and covariate shocks. Social protection floors (SPF)
promote four essential guarantees: i) access to essential health care services including maternity
benefits; ii) children’s income security through family and child benefits; iii) minimum income security
for those who are not able to earn sufficient income; and iv) access to pensions for old age and disability.
SPF policies should facilitate effective access to essential goods and services and be implemented in close
coordination with other policies enhancing employability, reducing informality and precariousness and
creating decent jobs.
Georgian social protection system includes some of the essential universal lifecycle programmes (such
as health, old-age and disability benefits), but it also lacks key provisions for the working age population
(such as unemployment insurance/benefits and survivor’s benefits for adults) with weak programmes
and low coverage in case of sickness and maternity protection. Social assistance programme with
strictly defined coverage are focused on the most disadvantaged but have contributed significantly to
poverty reduction.
This fragmentation fully exposed the vulnerability of women, men and children who are not covered by
social protection system in the context of the COVID-19 pandemic. Unemployed and those working in
the informal economy had no access to income security or protection against unemployment, maternity
protection or child benefits. The Government reacted swiftly to provide an emergency six months
unemployment support scheme for employees together with a one-off transfer for self-employed
persons; and a temporary expansion in eligibility for targeted social assistance. If these programmes
would be further considered and designed as a long-term response based on the social protection floors
principles and recommendations of this report they would go a long way towards closing identified gaps.
The report also shows that in Georgia, as elsewhere, gender inequalities are most pronounced during
working age when women face a double burden of work outside and inside the home. A number of key
lifecycle benefits during working age (including maternity protection, paid sick leave and the right to
build up savings in the accumulated pension system) are reserved for those in formal employment. This
leaves out more than half of working women in Georgia. The social security system that takes account
these differences can mitigate labour market inequalities, and significantly contribute to gender equality.
The report suggests that investing in three core social protection programmes: unemployment
insurance, maternity protection and extension of child benefit would cost around 2 per cent of GDP,
and less ambitious options that would offer basic protections would cost even less. Pooled financing
arrangements could alleviate the burden on the State to finance these benefits while also building
support among society and social partners for a social security system that is fit for a growing economy
like Georgia’s. In a longer term, more comprehensive social protection system would contribute to
economic growth by raising labour productivity, enhancing social stability and acting as an automatic
stabilizer for the economy by alleviating the decline in aggregate demand.
ILO and UN Women sincerely hope that the Government agencies, social partners and the civil society
will find the analysis, findings and recommendations of this report valuable for social dialogue about
design of national social protection floors.
Erika Kvapilova Olga Koulaeva

UN Women Country Representative in Ukraine Director,
(former UN Women Country ILO DWT and CO for Eastern Europe
Representative in Georgia) and Central Asia
xii X Assessment of the Social Protection System in Georgia
X Executive summary 1
X Executive summary
Overall, around 40 per cent of the population in Georgia is covered by at least one social protection
benefit. However, there are large discrepancies across age groups. While Georgia has achieved nearly
universal coverage of older people – a noteworthy policy and administrative achievement – children
and people of working age are much less likely to receive a benefit, at 20.9 per cent and 14.5 per cent,
respectively. This low overall coverage rate reflects significant gaps in provision for risks affecting these
age groups, especially children.1
The Georgian social security system, which is predominantly tax financed, reflects a legacy of historical
pendulum swings. Currently, it consists of a mix of lifecycle and non-lifecycle benefits (see Figure 0.1),
including the essentially universal provision of key lifecycle benefits (e.g. old-age and disability benefits);
a dependence on employers to provide certain others (e.g. sickness benefits and employment injury
protection); and a reliance on poverty targeting to attempt to reach those who are considered poor (e.g.
through the Targeted Social Assistance Programme (TSA) and the Child Benefit Programme (CBP)). The
system also lacks key lifecycle provisions as would be called for under the ILO Social Security (Minimum
Standards) Convention, 1952 (No. 102): there is no employment injury scheme (yet), no unemployment
insurance, no survivors’ benefits for adults, and weak frameworks and low coverage for sickness and
maternity benefits.
X Figure 0.1:
Key lifecycle risks in Georgia relative to ILO Convention No. 102
Children Working age Old age Key gaps in

lifecycle
provision
No employment
injury scheme
(yet)
Child Benefit Programme Cash sickness benefits State Pension No

(Labour Code only) (universal old- unemployment
(CBP)
age pension) insurance
Lifecyle Social Package - Survivors’ Maternity benefit (formally
benefits Accumulated No survivor
(universal survivors’ benefit) employed only)
pension benefits for
outlined (mandatory adults
under Social Package - Disability (universal disability pension) individual
account) Weak sickness
C102 and maternity
Universal Health Care Programme (UHCP) benefits with low
legal coverange
Non-Lifecycle
Targeted Social Assistance (TSA), “Categorical” benefits (e.g. for IDPs)
benefits
Source: Authors ’ depiction.
1 For people of active age, receipt of benefits is a slightly less meaningful indicator of overall protection, since many
of the contingencies covered under lifecycle social security systems are short term in nature (for example, sickness,
maternity, unemployment, etc.) or only affect a relatively small proportion of the population (as is the case with disability).
Nonetheless, the very low beneficiary ratio of working-age people in Georgia reflects the absence of key programmes,
like unemployment, for risks affecting this age group. For children, however, like older people, a lifecycle social security
system would consider childhood itself to be a risk, and therefore anything less than 100 per cent coverage of children
indicates a gap.
2 X Assessment of the Social Protection System in Georgia
The Government of Georgia already has a solid policy and administrative architecture for delivering key
lifecycle benefits on a universal basis. However, a number of administrative blind spots exist, especially
relating to disability, sickness and maternity benefits, creating challenges for the overall governance of
the system and the fulfilment of the right to social security. Notably, the biggest complaints from citizens
centre on the delivery of the poverty-targeted TSA, despite the programme being well administered by
most accounts. This is most likely a reflection of the programme’s design rather than administrative
failings, where even the most accurate proxy means test will have large exclusion errors.
There is potential for the generally effective benefits-delivery infrastructure and know-how, however, to
be exploited to extend the universal principles to other lifecycle contingencies – such as child benefits or
even maternity benefits – while also considering the potential for pooled arrangements to finance short-
term benefits like maternity and unemployment benefits. Importantly, non-lifecycle programmes like the
TSA – which aim to offer a “last resort” against poverty – are not a substitute for the provision of lifecycle
benefits and will always leave a substantial number of people without coverage when they need it.
Social protection for children: Progress

with the CBP, but gaps remain
Children are significantly more likely than other age groups to live in poverty: around 12 per cent of
children were living below 40 per cent of median consumption (the relative poverty line), compared with
only 8 per cent of people of working age and 5 per cent of people above retirement age. And many more
children are at risk of poverty, with nearly 30 per cent living below 60 per cent of median consumption.
Therefore, ensuring their welfare through social protection should be of paramount concern.
X Figure 0.2:
Percentage of children receiving the CBP, by consumption decile, 2018
100%
90%
80%
Percentage of children
70%
60%
50% 43.0%
40%
30% 25.0%
11.2%
20% 8.7%
4.4%
10% 1.4% 1.5%
0.4% 0.3% 0.8%
0%
Bottom 2rd 3rd 4th 5th 6th 7th 8th 9th Top
Deciles of population, ranked by per capita consumption
Source: Analysis of the 2018 IHS.

Whereas overall, just over one in five children in Georgia receives a social protection benefit of any kind,
only around 14 per cent receive a child benefit under the Government’s flagship Child Benefit Programme
within the framework of the TSA (see Figure 0.2). However, less than half in the poorest income decile
are receiving the CBP, suggesting that the CBP is still missing a significant number of children who are
otherwise vulnerable, despite the Government’s commitment to improving the targeting formula.
At the same time, while lifecycle benefits provided under the Social Package (disability and survivors’
benefits) seem to be effectively reaching those who apply (and for disability benefits, those who are
assessed as disabled), a lack of knowledge about the true size of the disabled child population or child
survivor population prevents us from knowing how many children who might legitimately qualify for
these benefits could be excluded, whether due to lack of knowledge of their rights or other barriers to
access.
The assessment also suggests that, on the whole, existing benefits for children are adequate, largely
due to recent policy changes that increased the CBP by five times its previous value. However, a lack
of robust international standards for measuring adequacy prevents a definitive qualification. Rather,
adequacy is more effectively assessed within the national context based on close study and evaluations
of beneficiary populations and within a framework of nationally relevant benchmarks, of which there is
currently a deficit in Georgia.
Social protection for people of working age: Key provisions

are lacking, mixed results with existing benefits
Working-age people in Georgia lack access to key social protection provisions that would better enable
them to weather common lifecycle shocks, notably unemployment, survivors’ benefits and, for now,
insurance against work-related accidents or diseases. In addition, legal gaps in coverage prevent many
people from being covered even where the system ostensibly provides benefits. However, the headline
statistic that only around 14.5 per cent of the adult population was receiving a benefit in 2018 masks
more complex coverage dynamics among the working-age population.
For disability, the overall story is one of relative success. A universal benefit ensures that the vast majority
of people who live with a disability are able to access benefits from the State to improve their quality of
life. The link between the disability assessment process and the payment of benefits appears to be tight,
with bigger gaps for those with less severe disabilities: between three quarters (Group I) and almost all
of the registered disabled population (97.6 per cent for Group II and 99.7 per cent for Group III) were
receiving a benefit, according to the 2018 Integrated Household Survey (IHS). Approximately 95 per cent
of those receiving the Social Package disability benefit are of working age; this is because the disability
pension converts to an old-age pension at retirement (see Figure 0.3), a transition that the data would
suggest is well administered. A more serious challenge to the system is the lack of accurate estimates of
the true size of the disabled population, as there are bound to be people who fail to obtain an assessment
for any number of reasons.
In terms of adequacy, disability benefits also appear to be lower than the levels that would be suggested
under the relevant ILO Conventions, accepting the caveats associated with using the reference wage for
elementary occupations; however, the benefits compare relatively well with international levels, again
with caveats.
For sickness and maternity benefits, data limitations make it challenging to precisely determine the
size of the legally covered population, but our estimates suggest that around half the labour force lacks
protection for either of these risks, which is by far the biggest challenge. Among those who are legally
covered, administrative data for maternity benefits suggest that take-up is quite high. There is no
comparable data on sickness benefits, making it impossible to assess effective coverage, but there are
bound to be a significant number of people who are not receiving sick pay despite having the right, in
addition to the large numbers of people working informally who do not have the right.
X Figure 0.3:
Percentage of the registered disabled population receiving a Social Package

disability benefit or an old-age pension, 2018
100%
Percentage of the population
90%
80%
assessed as disabled
70%
60%
50%
40%
30%
20%
10%
0%
4
+
0-
5-
-1
-1
-2
-2
-3
-3
-4
-4
-5
-5
-6
-6
-7
-7
80
10
15
20
25
30
35
40
45
50
55
60
65
70
75
Age (five-year groups)
Disability pension (Social Package) Universal old-age pension
Regarding the adequacy of these benefits, the state maternity benefit covering formally employed
private-sector workers and the majority of public-sector workers is inadequate due to its lump-sum
nature and low value relative to women’s average wages. Because of the cap on the total amount, the
benefit only replaces a fraction of women’s lost earnings, far lower than the two thirds required of the
ILO Maternity Protection Convention, 2000 (No. 183). In terms of duration, however, in theory the state
maternity benefit compares well (at 183 days) to the Convention, but again, as a lump-sum benefit, this
duration becomes almost irrelevant for most people who access the benefit. There are also no paid
paternity leave provisions. On the other hand, sickness benefits compare relatively well to the minimum
standards in the relevant Conventions, but there are concerns related to potential inconsistencies with
the Labour Code of Georgia that risk having a chilling effect on legitimate claims.
Social protection for older people: Noteworthy

achievements, but future challenges
The story of the coverage of Georgia’s older population is mostly a positive one. Everyone in Georgia,
apart from those few who receive a State Compensation benefit, can count on the universal old-age
pension to provide a basic guaranteed income in old age. Georgia stands out globally among countries
of similar incomes in this achievement and also compares well with social pensions in high-income
countries. However, the pension system does not currently enable the majority of older people in Georgia
to smooth their consumption and maintain a standard of living comparable to their pre-retirement
levels, and the absence of survivors’ pensions for adults leaves many older people, particularly women,
vulnerable.
In addition, a significant share of the elderly (around 9 per cent) is also receiving the TSA. As shown in
Figure 0.4, older women are around twice as likely as men to qualify for the TSA, while upward of 30 per
cent of single older persons qualify compared with just 4 per cent of those who are married. Moreover,
a quarter of older persons with severe disabilities receive the TSA. These findings strongly suggest that
the old-age pension, on its own, is insufficient for older persons experiencing multiple vulnerabilities,
including those facing additional costs related to disability.
X Figure 0.4:
Percentage of older persons receiving the TSA, by select background

characteristics, 2018
40% 40%
31%
30% 30%
20% 20% 18%
13%
10% 10%
10% 10%
5%
4%
0% 0%
Female Male Married Non-registered Single Divorced Widowed
marriage
Sex Marital status
40%
30%
26%
25%
20%
17%
13%
10% 9%
7%
0%
None Group I disabled Group II disabled Group III disabled IDPs Chronic patient
Special status
Source: Based on the 2018 IHS.

The recent introduction in 2018 of the supplementary accumulated pension scheme aims to improve
this situation for future generations of pensioners. Efforts to enrol the workforce appear to have
been successful so far, with 100 per cent of the mandatorily covered population enrolling as well as
a small share of those eligible for voluntary participation. However, as with other schemes that only
cover formally employed workers, this amounts to only around half of the labour force. Nevertheless,
this apparent achievement demonstrates good state capacity that can help reintroduce the habit of
deducting social contributions among employers even where participants are sceptical of the benefits.
Because benefits will not be paid out for many years, assessing their adequacy is a largely theoretical
exercise. However, global experience with pension reforms in the past few decades strongly suggests
that the design of the new pension is likely to bode poorly for those with lower earnings and shorter work
histories, notably including women. This is because funded pensions, which tie benefit values tightly to
contributions with no possibility of cross-subsidization, tend to exacerbate labour market inequalities
where they exist.
International experience also suggests that the system in its current form would not be suitable for
the introduction of additional benefits to cover the working-age population, should the Government
want to do so. This is because accumulation- or savings-based designs depend on workers building
up significant funds to cover long-term risks like permanent disability or old age. Introducing the
possibility of withdrawal for risks (such as maternity, sickness or unemployment) at younger ages would
risk depleting the fund. A social insurance scheme would be more appropriate as an alternative – or
complementary, under a multi-tiered framework – financing arrangement for working-age risks.
Health care across the lifecycle: High coverage,

but challenges with adequacy
While Georgia has succeeded in extending health insurance coverage to virtually the entire population,
the vast majority of whom are insured under the near-ubiquitous Universal Health Care Programme
(UHCP, also known as the State Health Insurance Programme), the story of vertical extension (adequacy)
is less positive. Compared with high-income countries, Georgians on average spend significantly more
than the OECD average on out-of-pocket health expenditures as a share of household consumption, at
around 6 per cent. Those in middle-wealth deciles bear a heavier burden due to lower available subsidies
(see Figure 0.5). Private spending also accounts for around half of total health spending (54 per cent)
in Georgia,2 suggesting, among other things, that there is a substantial degree of topping up of the
basic state-sponsored package, where sometimes essential components of preventive health, such as
contraceptives, must be purchased privately.
Therefore, while the support that the Government offers Georgians through the UHCP likely prevents
most people from catastrophic health expenditures, many people, especially those who are not eligible
for subsidies or who are only eligible for relatively meagre ones, still incur significant health-care costs.
Social protection and women and girls in Georgia

The analysis in this report has emphasized the unique challenges that women face due to the combination
of their life course and highly gendered labour markets. These inequalities can be mitigated or
exacerbated by the social protection system, depending on how it is designed. The interactions between
gender and social protection are complex and mediated by the life course, where risks faced in childhood
may be very different from the risks faced in adulthood or old age.
The analysis found that girl children are more likely than boy children to be poor and are slightly more
likely to benefit from the social protection system. For example, 15 per cent of girls receive the CBP
compared with 13 per cent of boys, but because girls make up a slightly lower proportion of the child
population (48 per cent), there is no discernible difference in the gender make-up of CBP beneficiaries.
2 Georgia, Ministry of IDPs (2018).

X Figure 0.5:
Median monthly household expenditure on health care as a percentage of monthly

household consumption expenditure, by consumption decile, 2018
10%
9%
8%
7%
6%
5%
4%
6.6% 6.9% 6.8%
3% 5.8% 5.9% 6.2% 6.2%
5.4% 5.1%
2% 3.3%
1%
0%
Bottom 2rd 3rd 4th 5th 6th 7th 8th 9th Top
Deciles of households, ranked by per capita consumption
For women of working age, only those who are employed in the formal sector have access to maternity
benefits, leaving out around half of working women. Moreover, because all maternity benefits are
financed from state revenues, they are subsidized by those in the informal economy who still pay
consumption taxes. Existing benefits, when they are paid, are inadequate, and the future benefits of
those who are required to contribute to the mandatory accumulated pension scheme are likely to be
lower for women.
Older women, because of their longer life expectancy, are more reliant on the social protection system
for longer periods in old age; therefore, the adequacy of the universal old-age pension is particularly
relevant for them. In addition, women make up 86 per cent of all widow(er)s in Georgia and yet have no
access to survivors’ benefits if their partner dies.
This analysis has demonstrated that the gendered nature of the life course and labour markets requires
the social protection system to be particularly responsive to gender-based inequalities. However, the
social protection system, with its focus on income redistribution across wealth groups and generations,
is only one component of the broader set of gender-responsive tools available to governments to address
structural inequalities, including those that begin in the household.
Towards a more inclusive lifecycle social

protection system in Georgia
Georgia’s system already performs relatively well, largely driven by the impacts of the old-age pension on
poverty and inequality. However, key gaps in social protection provision remain, particularly for children
and people of working age. Filling them – through a universal child benefit, an expanded maternity
benefit system and an unemployment scheme – would go a long way towards ensuring that no one in
Georgia is unintentionally neglected during these common lifecycle contingencies. (Additional measures
to strengthen the system over the longer term – including mechanisms to promote equity and gender
equality by closing the gaps in the provision of survivors’ benefits, providing parental and paternity
benefits, recognizing unpaid care in contributory systems and engaging in a full review of the system’s
monitoring and evaluation processes – should also be considered.)
Moreover, such a system would not be prohibitively costly. Implementing all three of these core benefits
would cost around 2 per cent of GDP, and less ambitious options that would offer basic protections would
cost even less. Pooled financing arrangements could alleviate the burden on the State to finance these
benefits while also building support among society and social partners for a social security system that
is fit for a growing economy like Georgia’s.
X 1. Introduction 9
X 1. Introduction
Since 2003, the Government of Georgia has implemented broad and comprehensive economic reforms
that constitute part of its “Vision for Development”, as articulated in its Social-Economic Development
Plan (SEDP).3 Inclusive economic growth (universal involvement of the population in economic processes)
is a central principle of the reforms.
In recent years, Georgia has experienced rapid growth – averaging 4.5 per cent per year in the past
decade, despite a number of shocks 4 – and prior to the onset of the COVID-19 global pandemic, the
IMF had expected the growth trajectory to continue.5 During this period, however, the Government has
pursued a package of neoliberal policies that, unless they are accompanied by an equally strong push
for comprehensive social security, are unlikely to usher in the inclusive growth it seeks. Reform priorities
have included liberalization of the tax system, deregulation, easing the process of starting a business
and aggressive privatization. In addition, public-sector reforms have focused on eliminating corruption,
decreasing the number of government agencies and downsizing those that remained.6 These policies are
often associated with austerity and “fiscal consolidation”, which can hamper investment in social sectors.
X Figure 1.1:
Percentage of the population living in poverty, by different national measures,

2004–2018
50%
40%
30%
20%
10%
0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Share of population below 60% of median consumption

Share of population below 40% of median consumption
Share of population in absolute poverty
Source: Geostat.
3 Georgia (2014).
4 World Bank Group (2019). Georgia experienced numerous shocks, including the 2007–2008 global financial crisis, the
conflict with the Russian Federation in 2008 and the drop in commodity prices since 2014 that has impacted key trading
partners.
5 IMF (2019a). The IMF have revised its growth projections and are predicting a contraction of 4 per cent of GDP in 2020.
See https://www.imf.org/en/Countries/GEO.
6 Georgia (2014).
However, the Government, in the SEDP, recognizes the importance of investing in social protection for
an inclusive growth agenda, and the general increase in average incomes has also been partly driven
by social transfers. The improvement of Georgia’s social protection system (a further goal of the SEDP)
has been viewed by the Government as a means of both increasing the competitiveness of the country’s
human resources and improving the socioeconomic conditions of families experiencing financial and
material hardship. The prioritization of social protection has been reflected in state budget expenditures
in recent years – over the past several years, social protection expenditure has grown to around 25 per
cent of central government expenditures.7
Thanks to the combination of growth and investment in social protection, Georgia has made impressive
progress in tackling poverty.8 According to the World Bank (2019), poverty (measured at USD 3.20 per
day) declined from 32.5 per cent in 2006 to 16.3 per cent in 2017 and, according to the national household
survey, was around 12.5 per cent in 2018.9 After years of decline, poverty reduction stalled between 2015
and 2017, during which the share of Georgia’s population living in absolute poverty actually increased
very slightly from 21.6 per cent to 21.9 per cent, though it began to decrease once more in 2017, as shown
in Figure 1.1. The full impacts of the current crisis are as yet unknown but are likely to be significant in
Georgia, as they are elsewhere.
The overall decline in poverty over the past decade can largely be attributed to a general increase in
real incomes across rural and urban areas. However, the gains have not been equally shared. Overall,
inequality remains high by regional standards, although it has been declining in recent years, reflecting
strong improvements in the welfare of households in the bottom 40 per cent of income distribution.10
And while the average Georgian received GEL 1,068.30 (USD 374) per month in 2018, up from GEL 900
(USD 313) in 2015, on average, women’s earnings amounted to only 64 per cent of men’s in 2018, and in
general, men benefited more from increased salaries than women.11
As an upper-middle-income country with ambitions to align more closely with Europe and eventually join
the European Union,12 the time is ripe for Georgia to deepen its commitment to inclusive social protection.
A progressive and ambitious nation should aim not only to tackle poverty but also to offer the majority
of its citizens the opportunity to realize their aspirations to lead more productive and secure lives.
This report aims to offer a general assessment of the social protection system in Georgia from a lifecycle
perspective and in reference to international experiences, as well as to social security standards and
conventions. The report is structured as follows: Chapter 2 presents an overview of Georgia’s social
protection system from a lifecycle perspective and with reference to international norms and definitions;
Chapters 3, 4 and 5 assess the social protection coverage of children, women and men of working age and
older people, respectively, in terms of legal and effective coverage (including adequacy), with attention
paid to gender differences in outcomes; Chapter 6 briefly assesses health-care provisions in terms of
legal and effective coverage; Chapter 7 summarizes the main findings on social protection for women
and girls in Georgia; Chapter 8 explores scenarios for expanding the existing system and their potential
costs; and Chapter 9 offers concluding observations.
7 Geostat.
8 World Bank (2019).
9 Ibid. The 12.5 per cent figure is based on analysis of the 2018 IHS using the USD 3.20 per day PPP measure.
10 The Gini coefficient was 0.39 in 2018, down from 0.43 in 2006 (see Geostat: https://www.geostat.ge/en/modules/
categories/192/living-conditions).
11 See Geostat: https://www.geostat.ge/en/modules/categories/39/wages; and UN Women (2020a).
12 Gegeshidze (2018).
X 2. Understanding Georgia’s social protection system within a lifecycle framework 11
X 2. Understanding Georgia’s social protection

system within a lifecycle framework
In recent years, the objective of improving Georgia’s Targeted Social Assistance Programme (TSA) has
dominated the social protection policymaking space. In effect, the attention to the TSA has largely
obscured other relevant programmes and diverted attention away from efforts to understand the
social protection system more broadly.13 This study seeks to address this imbalance and offer a broad
assessment of the social protection system as a whole in Georgia using a lifecycle framework. The
report focuses primarily on income transfers but also calls attention to health benefits as the principle
vehicles for delivering lifecycle social protection, in line with the ILO Social Security (Minimum Standards)
Convention,1952 (No. 102), and the Social Protection Floors Recommendation, 2012 (No. 202).
2.1 A lifecycle approach to social protection

Social protection entails the provision of regular, predictable income transfers (in cash or in kind) and can
also include the provision of social care, social services and active labour market programmes.14
Social protection is among the most powerful tools to address poverty and inequality and, if well
designed, can be “transformative” – supporting broad-based economic growth by encouraging recipients
to invest in small businesses and their communities and to enable them to work more and in more decent
jobs.15 One of its core functions, however, is to build resilience to shocks, most of which are linked to the
human lifecycle. Figure 2.1 depicts the risks that tend to occur at different stages of the lifecycle, as well
as other risks, such as disability or certain “covariate” risks (such as natural disasters), that can occur at
any point along the lifecycle and/or may be chronic.
X Figure 2.1:
Key risks across the lifecycle
Early childhood School age Youth Working age Old age
Unsafe birth and no Child labour Inadequate skills Unemployment and Increasing frailty
access to antenatal and Unable to access or stay in Unemployment underemployment Inability to work
postnatal care school Inability to access training Coast of children No care from family
No immunization Pool home environment Alienation Care of parents Discrimination in labour
Stunting impacting on schooling Debt force and access to credit
Reduced cognitive Malnutrition Cost of dowry
development Child abuse No childcare
Loss of parents Gender discrimination
Domestic violence
Disability and chronic illness
Covariate risks
Source: Development Pathways’ depiction.
13 Baum et al. (2016).
14 Social protection and social security are frequently used interchangeably, though there are some notable distinctions. For
a discussion of the usage of the two terms, see “Glossary” in Kidd and Tran (2017).
15 See, for example, Mathers and Slater (2014); and Kidd and Tran (2017).
The most common of these risks have been enshrined in various international declarations and
conventions going back more than 75 years, the most prominent and comprehensive of which is the
ILO Social Security (Minimum Standards) Convention, 1952 (No. 102).16 The Convention sets minimum
standards for social security to address nine lifecycle contingencies through the establishment of old-age
pensions, disability benefits, survivors’ benefits, cash sickness and maternity benefits, unemployment
benefits, employment injury benefits and family benefits, as depicted in Figure 2.2.
X Figure 2.2:
Lifecycle benefits specified under ILO Convention No. 102
Children Working age Old age
Child (family) benefits Cash sickness benefits Old-age pension
Cash maternity/paternity
benefits
Lifecyle
Unemployment benefits
benefits
outlined Disability benefits
under Survivors’ benefits
C102
Employment injury compensation
Health care
Non-Lifecycle
Minimum income guarantees, benefits for specific vulnerable groups, etc.
benefits
Source: Authors’ depiction based on Convention No. 102.
Most mature social security systems provide comprehensive protection through schemes aimed at
tackling these common risks and, by doing so, are well positioned to provide broad-based income
security that not only prevents poverty but maintains living standards during a shock. But alongside core
lifecycle benefits, a national social security system may also include non-lifecycle benefits – for example,
for certain specified categories or vulnerable groups – or minimum income guarantees to address the
risk of poverty, as Figure 2.2 also shows.
Importantly, in a lifecycle approach, individuals – not households – are entitled to receive benefits. This
is in keeping with a rights-based approach, which recognizes the inherent human right of all individuals
to social security.17 While individuals may, and typically do, benefit indirectly from household transfers,
16 ILO (1952).
17 Social security is a human right, as outlined in Article 22 of the Universal Declaration of Human Rights, which states,
“Everyone, as a member of society, has the right to social security and is entitled to realization, through national effort and
international co-operation and in accordance with the organization and resources of each State, of the economic, social
and cultural rights indispensable for his dignity and the free development of his personality.”
the mechanism is not guaranteed, particularly in situations where intrahousehold dynamics are
imbalanced, resulting in an unequal sharing of resources. For example, in certain situations, women
may be particularly disadvantaged where transfers are paid to the head of household (typically male),
and efforts to correct this within a household transfer framework are not straightforward, as explained
in Box 2.1.
X Box 2.1: Gender sensitivity in individual- versus household-level benefits

Well-designed social protection can boost women’s economic independence and status in the
household. This is especially true when women are entitled to benefits as individuals in their
own right.
With household benefits, however, which tend to be paid directly to the head of household, the
impacts of benefits on different members of the household may vary due to unequal sharing
of resources between household members. Policymakers in some countries have recognized
this risk, and indeed, a dominant thesis in the early years of cash transfers promoted paying
transfers to women (the female head of household) based on the view that women were more
likely to spend it wisely. Indeed, Mexico’s PROGRESA programme (later “Oportunidades” and
then “PROSPERA”) was explicitly designed with this in mind. It has been posited, and sometimes
observed, that paying transfers to women can improve their status in the household and give
them greater financial independence, as well as providing “soft” assurance that the resources,
which in many cases are intended to support children, will actually be spent on children’s need
(see e.g. Adato et al., 2000; Skoufias and McClafferty, 2003; Skoufias, 2005; Natali et al., 2016).
However, there may be risks in utilizing these policy tools intended to correct gender power
imbalances. For example, paying household transfers to women can reinforce traditional,
gendered stereotypes about women’s roles and behaviour and play into notions that men
are not responsible for children’s welfare. Conditional cash transfers in particular – when they
are paid to women – have been criticized for offloading responsibilities (such as enforcing
compliance with programme conditions) that should legitimately be the remit of the State and
placing them entirely on women, potentially disadvantaging them in favour of other members
of the household (often children) (ISSA, 2017; Molyneux, 2007).
In general, individual benefits, paid for common lifecycle risks, avoid these pitfalls and are a
much simpler way of designing a gender-sensitive social security system.
In Georgia, the social protection system predominantly consists of individual lifecycle
transfers. Indeed, all major transfers apart from the TSA are directed to individuals based on
defined risks. With respect to the TSA benefit, any adult representative of the family can apply
for the household, and households can designate an adult to receive the transfer into his or
her account. (The same is true of the Child Benefit Programme (CBP), which is administered
together with the TSA; however, specific amounts in the CBP correspond to individual children
and therefore would be considered individual benefits under a lifecycle approach.) Data from
the SSA suggest that women are more likely to be designated to receive the benefit on behalf
of the household: by June 2020, 77.2 per cent of designated recipients were women, compared
with 22.8 per cent of men. However, future research would be needed to fully understand the
gender dynamics of applying for the TSA benefit as well as the distribution of control over
resources within households.
Moreover, while individual lifecycle benefits can be provided on a means-tested basis, household
benefits are nearly always designed this way and carry a high risk of excluding those who may not meet
the income test but are nonetheless vulnerable either by another measure or, inevitably, at some point
in their lives.
2.2 The role of social protection “floors”

within a national social security system
All social security systems should provide adequate, regular and predictable income security. In doing
so, they fulfil two core functions of a social security system: (1) to provide a minimum guaranteed income
to ensure that individuals do not fall below a given nationally defined threshold – a social protection
“floor”; and (2) to smooth consumption (or incomes) over individuals’ lifetimes if they experience defined
contingencies, thereby ensuring that they can maintain a comparable standard of living. Whereas
the first core function (a minimum guarantee) is generally achieved through schemes financed from
general revenues, the second core function (consumption smoothing) is typically only possible through
contributory arrangements – generally social insurance – that pool resources across groups of different
income levels.18
Lifecycle benefits are most inclusive when they are designed to offer universal coverage. This can be
achieved either through a single tax-financed design or through a combination of tax-financed and
contributory (social insurance) mechanisms that ensure universal coverage by design. Most social
security systems exhibit this “multi-tiered” design. Indeed, multi-tiered designs are the norm rather than
the exception globally: more than 100 countries around the world have multi-tiered pension systems,
including nearly all high-income countries.19 That said, some social security systems – including those in
Georgia as well as New Zealand and South Africa, among others – finance their main schemes through
general revenues, while a few European countries consist of social insurance only.20 Box 2.2 explains how
multi-tiered systems generally work.
18 Therefore, the reference level for determining the adequacy of social security benefits may be lower in tax-financed
schemes than in contributory schemes, which are based on prior earnings, even if both types of schemes contribute to the
system-wide aim of providing income security. In addition, while most social security benefits are intended to replace lost
income or wages due to interrupted earnings related to common contingencies, some benefits, such as child benefits or
medical benefits, are designed to provide additional support or compensation for extra expenditures related to bringing
up children or experiencing ill health.
19 Authors’ estimates based on analysis of ISSA/SSA (multiple years). See also McClanahan et al. (forthcoming).
20 Many European countries achieved near-universal coverage of their social insurance systems, which also contain non-
contributory or semi-contributory components within them.
X Box 2.2: Multi-tiered systems for universal coverage

Although all benefits across different “branches” of social security can be multi-tiered, pension
systems are most commonly associated with multi-tiered designs, as has long been promoted
by the ILO (see e.g. Duran, 2017). For example, an ideal pension system, depicted in Figure 2.3,
might consist of the following:
X Tier 1: an adequate, guaranteed pension (social pension) financed from general taxation and
which can be either universal or “pension-tested”
X Tier 2: mandatory social insurance paying higher-rate pensions for those who pay into
social insurance
X Tier 3: voluntary private (supplemental) pensions for those who wish to make additional
contributions21
The guaranteed tier 1 benefit can be designed universally, as Georgia’s social pension
effectively is, or it may be “pension-tested”, meaning the social pension is only paid to those
who are not enrolled in a mandatory social insurance system (usually because they cannot
afford contributions).
This pension-tested design provides an alternative to poverty targeting that is both fairer
and administratively simpler: all that is required is to maintain data on who is registered
in the social insurance system; everyone else receives the social pension. A further feature
of pension-tested systems is that, as social insurance membership grows, the size of the
population receiving tax-financed benefits – and the budget required to finance the system –
should decline over time.
X Figure 2.3:
Depiction of ideal pension systems with universal (left) or pension-tested (right) tier 1
Pension model with a national universal social pension Pension model with pension-tested tired 1
Voluntary
private Voluntary
Pension income
Pension income
pensions private
pensions
Pension is tapered to ensure that
A universal pension is the bedrock the social insurance pension is
of the system, ensuring a minimum always higher
income in old age for all citizens
Mandatory social
insurance Mandatory social
insurance
Universal social pension Tax-financed social pension
Poorer Richer Poorer Richer
Equally, other lifecycle benefits may be organized in a multi-tiered way. For example, Figure
2.4 outlines an ideal disability benefits system consisting of a combination of tax-financed
and contributory benefits that could be accessed at different phases in the lifecycle. See also
McClanahan and Gelders (2019) for a discussion of multi-tiered child benefits.
21 See Kidd (2015).

X Figure 2.4:
Multi-tiered disability benefits system
Children Working age Old age
Child disability benefits Income replacement scheme Old-age pension
Tax- Child disability benefits Personal independence payment (additional costs)

financed
Care/support benefit
Income replacement
disability pension
Social Old-age pension
insurance Employment injury
compensation
Source: Development Pathways.
In many ways, the momentum behind the UN-wide Social Protection Floor initiative arose from a
perceived inflexibility or “ill-suitedness” of traditional employment-based social protection systems to
adapt to the persistent challenges of poverty, social exclusion and labour market informality.22 In recent
decades, attention has turned to tax-financed or “non-contributory” social protection schemes23 as many
perceive them to be better suited to ensuring guaranteed coverage for groups traditionally left outside
the formal contributory system, and Georgia has been a global leader in this respect.
In addition to echoing the nine risks already underlined in Convention No. 102, the ILO’s Social Protection
Floors Recommendation, 2012 (No. 202), calls for basic social protection guarantees (including health
care) in childhood, during working age and in old age while allowing for a variety of policy approaches
to achieve universal coverage (consistent with multi-tiered systems).24 Importantly, a social protection
floor can be achieved through a combination of schemes, and indeed Recommendation No. 202 calls
on countries to implement “the most effective and efficient combination of benefits and schemes in the
national context” (Paragraph 9) but also requires that these be designed in a coherent way so as not to
leave gaps.25
However, there may be limits – at least in the immediate to medium term – to the extent to which
governments can ensure and improve the level (or adequacy) of benefits when they are completely reliant
on the state budget, particularly in contexts like Georgia’s where constitutional limits on spending and
22 See, for example, World Bank (2019).
23 The term “non-contributory” risks discounting the contributions made by all people throughout their lives, through their
work, the payment of indirect taxes, social reproduction and care, etc. See McClanahan (2019).
24 ILO (2012).
25 For example, among the core principles specified in Paragraph 3 is “coherence across institutions responsible for delivery
of social protection”.
new taxes constrain the fiscal space.26 A social insurance system that sits atop a guaranteed minimum
within a multi-tiered framework can offer a budget-neutral, fair and equitable way to ensure universal
coverage by design while improving benefit adequacy for those who are able to contribute.
2.3 Overview of Georgia’s social protection system

Georgia’s social protection system diverged from the experience of most post-Soviet countries in wholly
dismantling the social insurance and earnings-related social security system in favour of a tax-financed
model combining both universal and means-tested benefits. The radical departure triggered a profound
transformation of the Georgian economy and society.
Today, Georgia’s social protection system is known for the relative adequacy and near-universal coverage
of its tax-financed old-age pension, which makes it one of the most effective social pensions in the
world.27 Though it has received less attention, Georgia also provides universal disability benefits. And
it invests relatively heavily in a flagship poverty-targeted programme known as the TSA, which aims to
combat extreme poverty.
In the national policy domain and discourse, the main components of the current system include the
following:
X A universal old-age pension for everyone over the age of 60 (women) or 65 (men)
X So-called “categorical” (universal) benefits for persons assessed as disabled or orphaned (one or both
parents)
X Other “categorical” (means-tested) benefits for, e.g., persons living in high mountainous regions,
internally displaced persons and those with three or more biological children in regions with low birth
rates
X A poverty-targeted scheme (TSA) aimed at households assessed as poor
X A poverty-targeted benefit (CBP) for children living in households assessed as poor
X A lump-sum maternity benefit for mothers formally employed in the public and private sectors28
X Affluence-tested free or subsidized health care for those with incomes up to GEL 40,000 per year
(around three times the average wage) under the Universal Health Care Programme (UHCP)
X A new supplementary pension system based on mandatory savings
All of the main benefits are paid to individuals except for the TSA, which is paid to households.
In addition, the State provides a number of so-called “employer liability” programmes through the Labour
Code of Georgia, including paid sick leave provided by the employer and, in the near future, mandatory
employment injury insurance.
Overall, around 40 per cent of the population in Georgia is covered by at least one social protection
benefit. However, there are large discrepancies across age groups, as can be seen in Figure 2.5. While
Georgia has achieved nearly universal coverage of older people – a noteworthy policy and administrative
achievement – children and people of working age are much less likely to receive a benefit, at 20.9 per
cent and 14.5 per cent, respectively. This low overall coverage rate reflects significant gaps in provision
for risks affecting these age groups, especially children.29
26 Godar et al. (2018).
27 See Kidd and Tran (2017).
28 In addition, the Law on Public Service regulates a separate maternity benefits regime for civil servants.
29 For people of active age, receipt of benefits is a slightly less meaningful indicator of overall protection, since many
of the contingencies covered under lifecycle social security systems are short term in nature (for example, sickness,
maternity, unemployment, etc.) or only affect a relatively small proportion of the population (as is the case with disability).
Nonetheless, the very low beneficiary ratio of working-age people in Georgia reflects the absence of key programmes,
like unemployment, for risks affecting this age group. For children, however, like older people, a lifecycle social security
system would consider childhood itself to be a risk, and therefore anything less than 100 per cent coverage of children
indicates a gap.
X Figure 2.5:
Percentage of the population receiving at least one social protection benefit,

by age group and sex, 2018
Males Females Total
100%
80%
60%
98% 98% 98%

40%
45%
20% 31% 39%
23% 21%
19% 16% 13% 15%
0%
Children aged 0-15 Working-age People above retirement Total population
adults aged 16+ age
Figure 2.5 also shows coverage disaggregated by sex. Overall, some 45 per cent of women receive at
least one social protection benefit, compared with 31 per cent of the male population. This difference in
coverage between men and women is largely a result of the age–sex structure of the population – the
average age of women is 47.6 compared with 41.4 for men – and the fact that the retirement age for
women is 60 compared with 65 for men.30
2.3.1 Comprehensiveness of the system in

relation to international standards
Often, national definitions and usages of terminology around social protection diverge somewhat from
international frameworks. Applying an international lens can help expose gaps in the national policy
framework that may have been overlooked or underemphasized due to differing national political
priorities over time. Figure 2.6 summarizes the overall comprehensiveness of social protection provision
in Georgia relative to the nine lifecycle contingencies outlined in ILO Convention No. 102.
30 See also Sections 4.3.1 and 5.3.1.

X Figure 2.6:
Comprehensiveness of Georgia’s social protection system relative to lifecycle risks

under ILO Convention No. 102
Children Working age Old age Key gaps in

lifecycle
provision
No employment
injury scheme
(yet)
Child Benefit Programme Cash sickness benefits State Pension No

(Labour Code only) (universal old- unemployment
(CBP)
age pension) insurance
Lifecyle Social Package - Survivors’ Maternity benefit (formally
benefits Accumulated No survivor
(universal survivors’ benefit) employed only)
pension benefits for
outlined (mandatory adults
under Social Package - Disability (universal disability pension) individual
account) Weak sickness
C102 and maternity
Universal Health Care Programme (UHCP) benefits with low
legal coverange
Non-Lifecycle
Targeted Social Assistance (TSA), “Categorical” benefits (e.g. for IDPs)
benefits
Source: Authors’ depiction.
This overall configuration of social protection provision is reflected in the structure of beneficiaries. While
some programmes are specifically targeted at key age groups (such as the CBP or old-age pensions),
other programmes, such as the TSA or Social Package disability benefits, are not tied to age. Figure 2.7
shows the percentage distribution of social protection beneficiaries in Georgia across the main lifecycle
and non-lifecycle programmes, according to the 2018 Integrated Household Survey (IHS).
The universal old-age pension is a well-known achievement of Georgia’s social protection system, and
the near-universal health provision has garnered attention in recent years. The universal provision of
disability benefits is also a positive design feature that has received less attention but offers a solid legal
basis for achieving universal coverage through improved administration and delivery (see Section 4.3.1).
However, a cursory look at the scope of coverage of key Convention No. 102 lifecycle contingencies in
Georgia reveals a number of clear legal gaps, which are also highlighted in Figure 2.6.
1) There is no social security provision for employment injury (worker’s compensation), although the
new Law of Georgia on Occupational Safety includes a requirement for certain employers in hazardous
professions to privately insure their employees against the risk of work-related injury or disease.31
2) There are no unemployment benefits (contributory or otherwise) in Georgia, leaving more than
200,000 unemployed people to fend for themselves as they search for new work.32
3) While there is a survivors’ benefit for children, adults have no social protection in case of the death
of a spouse or partner and the associated loss of the spouse’s or partner’s income.
31 The draft Law of Georgia on Occupational Safety was unavailable at the time this assessment was being conducted, and
key provisions of the Law were still being decided.
32 Based on official statistics from Geostat. The unemployed population is calculated as persons aged 15 or older “who were
not employed (even for one hour) 7 days prior to the interview process, was looking for a job for the last 4 weeks time and
was ready to start working within the next 2 weeks time.” Geostat do not publish official data on underemployment.
X Figure 2.7:
Percentage distribution of social protection recipients, by programme, 2018
100%
80%
60%
40%
20%
0%
Targeted Social Child Benefit Disability Survivor pension Universal old- Special pensions Assistance for
Assistance (TSA) Programme pension (Social (Social Package) age pension for veterans and IDPs
(CBP) Package) other groups
Children aged 0-15 Working-age adults aged 16+ People above retirement age
4) Hundreds of thousands of workers who are self-employed, employed informally or not in the
labour force are excluded from certain benefits that are tied to employment status, including
maternity and sickness benefits and the new employment injury scheme.
5) Although they are related to employment, neither cash sickness nor cash maternity benefits are
financed through social contributions, creating uneven burden sharing and benefit coverage
(where individual employers bear the whole burden for sickness benefits, and maternity benefits for
employees are financed from general taxes even though not all women receive them).
These features partly reflect the distinct historical development of Georgia’s social security system. The
consolidation of the State Pension as the single national pension followed decades of oscillation between
different models of pension financing, as explained in Box 2.3. As a result of these fluctuations, and in
the face of high and rising levels of informality, it is no surprise that stakeholders have expressed some
scepticism about the potential for introducing a social insurance system in Georgia.33
33 Interviews with representatives of the Georgia Employers’ Association, the Georgian Trade Union Confederation and the
Solidarity Center (aligned with the AFL-CIO).
X Box 2.3: Oscillating models for burden sharing in Georgia

The post-Soviet social security system in Georgia has been characterized by extreme
fluctuations between different models for burden sharing under both social insurance and,
since 2006, tax-financed models.
For example, in the mid-1990s, employers were obliged to pay 37 per cent of payroll, while
employees only paid 1 per cent of earnings, with the Government covering deficits. The
employer contribution was subsequently reduced to 27 per cent by the turn of the decade and
then to 20 per cent. Then in the mid-2000s, employer contributions dropped to zero, shifting the
burden to employees, who were required to pay 25 per cent. And finally, contributions dropped
to zero with the complete elimination of social insurance in 2006 (ISSA/SSA, multiple years).
Today, all employees pay a 20 per cent “income tax” that is deducted at source from their
salaries. The flat income tax is not only regressive but also invites doubt about the locus of
responsibility since employers are responsible for filing the tax (according to an interview with
the Georgia Employers’ Association). Employers also pay a 20 per cent tax on all profits that are
not reinvested (Godar et al., 2018).
Given these extreme fluctuations and confusion about who bears the responsibility for
financing, it is not surprising that many stakeholders are apprehensive about the possibility of
reintroducing social contributions.
While the Rose Revolution in 2003 and subsequent neoliberal reforms reflected a rejection of state-led
development, paradoxically, the absence of social insurance mechanisms places the onus on the State
to provide adequate benefits for common lifecycle risks. In addition, apparently strict constitutional
limits on raising new revenues means the Government operates within a relatively narrow margin of
fiscal space. 34 Furthermore, the current financing arrangement, which relies heavily on a flat 20 per
cent income (payroll) tax paid by all employees, with no exemptions for lower-income workers, is highly
regressive and could create a strong disincentive to formal employment. 35 High levels of informality
disadvantage large numbers of workers while also further limiting the State’s ability to raise revenues
through the income tax system, potentially creating a vicious cycle.
In addition, there have been questions raised about the adequacy of the pension (see Section 5.3.2) for
key segments of the growing Georgian middle class. To address these concerns, the Government recently
introduced a supplementary pension system based on an accumulation model (mandatory individual
account), adding a new contributory dimension to the system. The new system will offer some additional
income to those who are able to put aside sufficient savings, but because benefit amounts are tightly
linked to contributions under a defined contribution arrangement, the system will favour higher earners
and could have negative implications for gender equality (see Section 5.3.2 and Chapter 7).
2.3.2 Reliance on poverty targeting to fill gaps left in lifecycle provision

In its tax-financed welfare provision model, the Government has simultaneously embraced – with
seemingly equal enthusiasm – both universal and poverty-targeted approaches, mixed with certain
employment-based benefits. The overall design leaves out many people in the middle who are not
eligible for targeted social assistance but who also do not receive employment-based guarantees. It
also leaves out a number of risks that are most likely to occur during working life.
Most people receive some support from the State for health insurance. And while older people, people
with disabilities and certain other groups perceived as “vulnerable” can get relatively robust protection
through universal tax-financed schemes, those who are perceived to be able-bodied are expected to
34 Georgia (2011). The Liberty Act placed limits on the Government’s ability to introduce new taxes. Taxes can only be
introduced by referendum, which can only be called by the Government.
35 UNICEF (2018b).
find security in the market or, if they are lucky enough to be formally employed, from their employer.
Only if they are “poor” (usually determined by a proxy means test) can they hope to receive additional
assistance from the State. For these people, starting a family or becoming unemployed can easily throw
them into poverty, but only 10.4 per cent of the population will be fortunate enough to qualify for the
TSA (or the associated CBP).36
In fact, many more people are vulnerable in Georgia than national poverty statistics suggest. Figure
2.8 shows the percentage of the population in Georgia living below various international poverty lines
(including extreme poverty) and the median poverty lines for lower-middle-income countries, upper-
middle-income countries and high-income countries. According to national figures, around 20 per cent
of Georgians were living in poverty in 2018, and when using the median poverty line for upper-middle-
income countries, some 36 per cent of people would be considered poor (including 35.6 per cent of
women and 36.6 per cent of men). Using the poverty line for high-income countries, nearly everyone
(96 per cent) in Georgia would be considered poor. In general, by all measures, poverty rates are slightly
lower for women, most likely reflecting the slightly higher coverage of social protection among women
than men.
X Figure 2.8:
Percentage of the Georgian population with per capita consumption below

international poverty lines, 2018
4%
GEL 9.96
Above $21.70 PPP per

day
Between $5.50 and

60%
$21.70 PPP per day
Between $3.20 and

$5.50 PPP per day
Between $1.90 and GEL 5.48

$3.20 PPP per day
24%
Below $1.90 PPP per
day
GEL 3.19
9%
3% GEL 1.89
Source: Source: Based on analysis of the 2018 IHS and World Bank Open Data.
Note: The values provided to the right of the diagram are nominal values in GEL.
36 Analysis of the 2018 IHS. A recent report by UNICEF estimates that 11.2 per cent of the population receives the TSA, based
on analysis of the Welfare Monitoring Survey. See Gugushvili and Le Nestour (2019).
In reality, people’s incomes are volatile and highly insecure and tend to move up and down the income
distribution within very short periods. For example, Kidd and Gelders (2015) found that more than two
thirds of households spent at least some time living in poverty (using either the general poverty line of
USD 2.50 per day (PPP) or the relative poverty line). These poverty and income dynamics are further
explained in Box 2.4.37 These results suggest that, rather than thinking of “the poor” as a static, reachable
group, it is more accurate to view poverty as a constant risk faced by everyone throughout their lives as
their circumstances change.38 It also suggests that even perfect poverty-targeting formulas and a perfect
census and assessment process cannot keep pace with rapidly changing realities.
X Box 2.4: Poverty and income dynamics

While it is common to refer to “the poor” and “non-poor”, in reality most people in low- and
middle-income countries are living in poverty, with per capita consumption below USD 5 or
USD 10 (in PPP terms). Furthermore, incomes are highly volatile as the result of households
experiencing risks and challenges or responding to opportunities. The implications of high
levels of poverty and dynamic incomes are twofold: the vast majority of people living in low-
and middle-income countries would benefit from access to social protection; and accurately
targeting a fixed group called “the poor” is extremely difficult since those at the bottom of the
wealth distribution constantly change.
The Government’s flagship Targeted Social Assistance Programme (TSA), first implemented in 2006,
is the primary vehicle for delivering cash assistance to households assessed as poor – a so-called “last
resort social assistance policy.”39 Georgia invests around 1 per cent of GDP in the TSA, which is much
more than most countries in their poverty-targeted programmes.40 Despite the fact that the programme
is considered among the most effective at reaching its target population,41 studies have found that it still
has exclusion errors of around 58 per cent.42 Indeed, evaluations of the programme confirmed that it was
not reaching enough of the households in the poorest deciles, in particular households with children,43
which prompted systematic reviews of the targeting mechanisms that led to reforms.
Like many poverty-targeted programmes around the world, the TSA selects beneficiary households
based on a proxy means test (PMT). Popularized by the World Bank in the mid-1990s, a proxy means test
is a targeting mechanism in which “information on household or individual characteristics correlated
with welfare levels is used in a formal algorithm to proxy household income, welfare or need”.44 The tool
was introduced to compensate for the absence of high-quality administrative data needed to perform
sophisticated means tests.
In Georgia, the PMT formula assessed household welfare as a function of consumption and needs,45
each of which is defined as an index constructed based on a complex set of indicators and predictors. For
example, the consumption index takes into account sociodemographic and location variables, income
and household consumption, while the needs index takes into account specific needs of vulnerable
37 Kidd and Gelders (2015).
38 Knox-Vydmanov (2014).
39 Baum et al. (2016).
40 Kidd and Gelders (2015).
41 Baum et al. (2016).
42 Kidd and Athias (2019).
43 Baum et al. (2016).
44 Grosh and Baker (1995).
45 Ibid. The inclusion of the needs index to account for variable needs across different type of households with different
compositions is a unique feature of Georgia’s PMT that is not typically found in similar programmes in other countries.
groups, age, gender and various subsistence minimum estimations.46 Once assessed, a household is
assigned a score, and programme eligibility thresholds are set against these scores based on policy
decisions around the intended size of the covered population. For example, the Government previously
enrolled all households with a maximum PMT score of 57,000 in the TSA, reaching approximately 12.6 per
cent of households; later, it increased the eligibility threshold to 65,000 in part to ensure that coverage
remained relatively constant (at around 13.4 per cent of households) in the face of changing national
welfare dynamics.47 Households are currently eligible for the TSA if they have a PMT score of up to
65,000, meaning (roughly) that it is aimed at households who are meeting approximately 65 per cent of
their estimated needs.48 Households are then reassessed at least every four years. However, as noted,
because household income and welfare are constantly in flux, many households are not eligible for the
programme despite their apparent need.
In fact, there is strong evidence internationally and in Georgia that universally designed lifecycle benefits
reach many more people deemed vulnerable than so-called “poor relief” schemes, with indirect benefits
accruing to members of their households. In Georgia, the share of children living in a household with an
old-age pensioner (35 per cent) is more than double the share of those living in a household with at least
one member receiving the TSA or CBP, as shown in Table 2.1. Likewise, only 7 per cent of working-age
adults live in households that receive the TSA, while almost a third live with an old-age pensioner. And
because the transfer values in universal programmes tend to be higher and the benefits reach many
more people, the aggregate impacts of universal programmes on poverty and inequality are often
greater than for poverty-targeted benefits.49 For example, in assessing the impacts of social transfers
on poverty reduction in Georgia, Kidd and Gelders (2015) found that pensions accounted for nearly 70 per
cent of the overall 29 per cent reduction in child poverty due to social transfers, while the TSA accounted
for only 20 per cent of the reduction.
X Table 2.1:
Percentage of population living in a household with at least one member who

receives transfers according to type of scheme, by age group, 2018
Targeted Child Disability Survivors’ Universal Assistance

Social Benefit pension pension old-age for IDPs
Assistance Programme (Social (Social pension
Programme (CBP) Package) Package)
(TSA)
Children aged 12.2% 14.2% 8.0% 2.1% 35.7% 5.8%
0–15
Working-age 7.6% 4.4% 10.6% 0.6% 32.0% 4.7%
adults aged 16+
People above 8.8% 1.4% 4.2% 0.4% 98.2% 4.5%
retirement age
Total 8.6% 5.0% 8.4% 0.8% 51.2% 4.8%
46 For a full discussion of the PMT formula and the recent revisions, see Baum et al. (2016).
47 Baum et al. (2016).
48 Ibid., p. 35. The authors note that “the fact that the household rating score is a ratio of observed consumption to the
expected needs level for a household of a given composition – albeit a rescaled one – allows us to interpret it as a fraction
of the needs met by predicted household consumption. For instance, a household with Q = 65,000 can be interpreted to
have an estimated consumption (l) level equivalent to 65 percent of its needs (N).”
Indeed, following this reasoning, several studies showed that the impacts on poverty could be even
greater by paying child benefits (or expanding their coverage) while reducing the TSA.50 Subsequently, a
full review of the PMT formula sought to improve the targeting efficiency and included the introduction
of a means-tested child benefit through the CBP, implemented alongside the TSA. Whereas the TSA only
includes households with PMT scores up to 65,000, the CBP has a higher eligibility threshold, where all
children in households with PMT scores up to 100,000 can receive a child benefit. The parameters and
basic features of the two programmes are summarized in Box 2.5.
X Box 2.5: Targeted Social Assistance and the Child Benefit Programme in Georgia
In practice, the TSA and the CBP operate in tandem, but it is useful to distinguish them
conceptually as the two benefits in theory serve different purposes. Whereas the TSA is
designed to ensure that no household falls below a defined (but variable) level of consumption,
the CBP shares characteristics of lifecycle benefits as it is specifically designed to provide
additional support to those who are bringing up children.
Even though the TSA is not a child-specific benefit, TSA households with children will receive a
TSA benefit for each household member, including children, and will also receive a CBP benefit
of GEL 50 per month for each child. For example, a family of two adults and two children with
a PMT score of 25,000 would receive GEL 340 per month (GEL 60 × 4 for the TSA and GEL 50 × 2
for the CBP). The parameters of each programme are summarized in Table 2.2.
Table 2.2:
Summary of parameters of the TSA and the CBP
PMT score Targeted Social Assistance Child Benefit Programme

Programme (monthly benefit) (monthly benefit)
0–30,000 points GEL 60 per household member GEL 50 per child aged 0–15
(including children aged 0–15)
30,001–57,000 points GEL 50 per household member GEL 50 per child aged 0–15
65,001–100,000 points None GEL 50 per child aged 0–15
>100,001 points None None
Source: SSA.
Thanks to the growing commitment of the Government to the CBP, the transfer value has increased by
five times – from GEL 10 per child per month when it was first introduced in 2015 to GEL 50 per child
per month today. However, the CBP is still poverty targeted, leaving many children unprotected who,
although they are not officially classed as poor according to the PMT score, are nonetheless vulnerable.
50 Baum et al. (2015); Kidd and Gelders (2015); and Gugushvili and Le Nestour (2019).
2.3.3 Spending on social protection

The Government of Georgia’s commitment to social protection is evident in the growing share of social
protection expenditures. As shown in Figure 2.9, social protection spending (not including health)
comprises around a quarter of Georgia’s budget – four times what it spends on defence – and is the
largest category of central government spending. When health is included, the share rises by an
additional 10 per cent to more than a third (34 per cent) of the State’s total budget.
X Figure 2.9:
Distribution of central government expenditures, by function, 2018
11% Social protection
3% General public services

24%
Defence
10% Public order and safety
0%
Economic affairs
1%
Environmental protection
Housing and community amenities

15% 20% Health
Recreation, culture and religion
10% Education
6%
Source: Ministry of Finance statistics.
Social protection spending has also been rising relative to other functions, with a significant increase
occurring after the Georgian Dream party came to power in 2012, as shown in Figure 2.10. Central
government spending on health care also increased significantly over the time period corresponding to
the introduction of the UHCP in 2013.
By far, the largest share of this spending goes towards financing universal old-age pensions, one of
Georgia’s most substantial and well-known social protection achievements, as shown in Figure 2.11. In
2018, the Government spent more than 70 per cent of its total social protection budget on pensions,
including both the universal old-age pension and so-called “State Compensation” to specific groups,
such as civil servants and war veterans and their survivors. The next largest share (26 per cent) goes to
a collection of schemes under the label “social assistance to target population groups”, which groups
together the TSA, the Social Package (disability and survivors’ benefits), childcare and other smaller
programmes.
X Figure 2.10:
Evolution of central government expenditures, by function, 2002–2018
14 000,00
Social protection
Government expenditure (GEL
12 000,00 Education
10 000,00 Recreation, culture and religion
Health
millions)
8 000,00
Housing and community amenities
6 000,00
Environmental protection
4 000,00 Economic affairs

Public order and safety
2 000,00
Defence
0,00
General public services
2002 2004 2006 2008 2010 2012 2014 2016 2018
Source: Geostat.
X Figure 2.11:
Composition of social protection budget, central government outlays, 2018
1% 0%
2%
Pension provision for the

population
26% Social assistance to target

population groups
Social rehabilitation and childcare
Social benefits in highland

settlements
70% Provision of protection, assistance

and state care to victims of
human trafficking
Source: Ministry of Finance statistics.

Note: “Pension provision for the population” includes the universal old-age pension (State Pension) and State
Compensation for special groups. “Social assistance to target population groups” includes the following benefits,
among others: the TSA (subsistence allowance); paid state maternity benefit for the private sector; childcare and
adoption of newborns; Social Package (including disability and survivors’ benefits); household subsidy; and benefits
for biological first-, second- and third-born children living in high mountainous settlements.
2.4 Governance and administration

Despite having entirely dismantled the Soviet-era social insurance infrastructure it initially inherited,
Georgia has invested heavily in recent decades in building up a solid policy and administrative framework
for delivering large-scale tax-financed social protection transfers, including relatively adequate universal
old-age and disability pensions51 – key elements of a lifecycle social protection floor. While the move to
close social insurance left a number of key gaps in provision, particularly for people of working age,
the legacy of relatively strong Soviet-era institutions is still visible in the current model: centralized
policymaking under the Ministry of Internally Displaced Persons from the Occupied Territories, Labour,
Health and Social Affairs (hereinafter Ministry of IDPs), as well as relatively streamlined delivery of most
income transfers and key social services under the Social Service Agency (SSA).
2.4.1 Institutional arrangements

Policymaking on social protection in Georgia is concentrated within the Departments of Health and Social
Protection of the Ministry of IDPs. The basic governance and administrative structure of Georgia’s social
protection system, including the key institutions responsible for the delivery of benefits and services, is
depicted in Figure 2.12.
X Figure 2.12:
Governance and administrative structure of Georgia’s social protection system
Ministry of Internally Displaced Persons (IDPs) from the Occupied Territories, Labour, Health and Social Affairs of Georgia
(policy oversight or, for pension agency, executive board)
Ministry of Finance Ministry of the Economy and

Department of Social Protection Department of Health (executive board) Sustainable Development
(executive board)
Social Service Agency (SSA)

(implementation and payment) Inspectorate of Labour
(oversight and implementation)
Pension Agency
(administration, contribution collection and payment)
Universal and means-tested Social services
benefits
Employment services (Worknet)
Medical benefits (direct provision)
State Pension (universal old-age Childcare programme
pension) Social care and rehabilitation
Social Package (universal disability
and survivos’ benefits) Future employment injury
State maternity benefit for private Courts Mandatory individual accounts insurance
sector
TSA and CBP Annuities or lump sums for: Disability pensions
Health insurance subsidies Old age Survivors’ pensions
Other (e.g. benefits for people in high Employers Disability
mountainous regions) Survivors
Cash sickness benefits
Employment injury liability
Source: Authors’ depiction based on ISSA/SSA (multiple years) and various government sources.
51 See Sections 4.3.2 and 5.3.2.

Georgia has invested in building a relatively strong state administrative apparatus. Over the past 10
years, nearly all social protection income transfers52 and state health insurance subsidies53 have come to
be administered by the SSA through its 72 branches (including 5 in Tbilisi and 67 around the country). The
SSA also administers a number of social services, including social care and rehabilitation programmes,
employment services,54 certain medical benefits55 and limited childcare services. The agency has made
use of improvements in data and information management in recent years, including better linkages
across programme databases and between national and local offices.56 According to agency officials,
this has led to an overall decline in complaints related to purely administrative issues, such as delayed
payment, which were typical under the previous paper-based system.57 Largely as a result, the SSA has
acquired a reputation as an effective state institution, although confidence remains relatively low among
at least some segments of civil society.58
In addition, interviews suggested that awareness of social security benefits is generally high among the
population, but there was no way to validate this. However, efforts are made centrally to make information
available to the general public about the benefits and entitlements available from the Ministry of IDPs.
For example, the websites for the Ministry and the SSA provide links and detailed information on benefit
levels, qualifying conditions and administrative procedures for accessing benefits, including adapting the
information for blind, visually impaired and hearing impaired persons.59 Despite these efforts, awareness
may be lower where access to the Internet is limited, such as in remote or mountainous regions.
The newly established State Pension Agency, a semi-autonomous body, administers the new
accumulated pension system through its 60 local branches.60 The agency is managed by a board made
up of representatives from three ministries: the Ministry of Finance, the Ministry of the Economy and
Sustainable Development and the Ministry of IDPs.61 Despite the scheme being the first mandatory
contributory scheme to be implemented since the Soviet-era social insurance system was dismantled
(with contributions to be paid in equal shares by employers and employees complemented by matching
amounts provided by the Government), the board does not include any representatives from trade
unions or employers’ associations. This imbalance not only goes against international standards (see
Box 2.6) but could also prove problematic and may explain some of the scepticism the scheme has met
in the general public, reflected in the recent challenge to the new law in constitutional court,62 as well as
in the distrust expressed by social partners.63
52 Exceptions include future benefits to be paid under the supplementary pension system (administered by the State Pension
Agency); cash sickness benefits (paid directly by the employer according to the Labour Code); and employment injury
payouts, which are currently adjudicated in the courts system but which will pass to the Labour Inspectorate (Labour
Conditions Inspecting Department).
53 The SSA issues insurance vouchers to eligible individuals to purchase insurance and acts as a single purchaser of health
care. See also Section 6.1.
54 See, for example, the official Worknet web portal at http://worknet.gov.ge/.
55 For example, while most providers in Georgia are now private, rural primary care doctors can be directly contracted by
the Ministry. See WHO (2018).
56 The Public Service Development Agency within the Ministry of Justice is working towards developing a single registry that
would integrate key national databases. Source: Interview with SSA officials.
57 Interview with SSA officials.
58 Interview with Caritas Georgia.
59 Written response from the Ministry of IDPs to questions about awareness-raising.
60 The State Pension Agency is an LEPL (legal entity of public law).
61 Georgia (2018).
62 The new Law on Funded Pensions has been challenged in the Constitutional Court of Georgia on the grounds that it
breaches Article II (right to equality) and Article 19 (right to property). See Krzyzak (2019).
63 Interviews with representatives from the Georgian Trade Union Confederation and the Georgia Employers’ Association.
X Box 2.6: Social dialogue in the governance of social protection systems

According to the ILO, social dialogue “include[s] all types of negotiation, consultation, or simply
exchange of information between, or among, representatives of governments, employers and
workers, on issues of common interest relating to economic and social policy.” Institutionalized
tripartite dialogue is a particularly effective way of mediating different interests and ensuring
that solutions are supported by key social partners.
Around the world, the presence of workers’ and employers’ representatives in the governance
structures of social security systems has been fundamental in shaping the parameters of core
schemes, in defining administrative regulations and in ensuring sound financial management.
Moreover, tripartite representation is included as a key component of social security fund
management, as demonstrated in ILO Convention No. 102 (Article 6).
When official channels for including diverse stakeholders in social protection are available,
solutions are not only more forthcoming but also more sustainable. Furthermore, the tripartite
governance of social security systems can build the trust of social partners in the Government’s
policies and administrative structures, which can have positive spillover effects into other
sectors.
Source: ILO (1952, 2020).
Employer-liability benefits are implemented in an uncoordinated way, with little apparent oversight by
the Ministry. Cash sickness benefits are paid directly to employees by employers, and employment injury
claims, which are decided in an ad hoc way without specific national guidance, are also paid directly
by employers to claimants. Indeed, it is fair to say that these benefits have been barely present in the
national discussions around social protection and social security; rather, they tend to be treated as labour
policy, although there are some signs of change with the recent agreements around the creation of
mandatory employment injury insurance.
It is worth noting that municipalities also administer a number of benefits, such as top-ups to national-
level benefits, but there is no centralized repository of information to track or assess them. The lack
of coordination between national and local levels was identified as a critical weakness in the overall
governance of the social protection system.64 Therefore, there is some risk of overlap and inequalities
between better- and worse-off regions and localities, and importantly, there is also a risk of some people
losing access to certain benefits at the national level.65
2.4.2 Administration and accountability

Even if general administration structures within the SSA are relatively robust, there are some notable
gaps and institutional “blind spots”, particularly with regard to the administration of certain benefits,
that hinder the Government’s accountability for upholding and ensuring the social security rights of the
population. The SSA, as the central administrating body, is the State’s principal front-line interface with
citizens and residents for the social protection system. Residents’ satisfaction with and trust in the social
protection system continues to hinge on the SSA’s ability to efficiently and transparently channel their
feedback into concrete improvements to the administrative procedures However, even beyond the SSA,
for benefits that are outside its remit, it is vital that adequate channels exist between administrators and
policymakers so that issues that relate to the policy design can be addressed by the appropriate vested
authority. This is true for both lifecycle and non-lifecycle benefits, such as the TSA. However, because
poverty targeting places a higher administrative burden on the State and excludes otherwise deserving
people by design, the TSA is particularly susceptible to complaints.
64 Interviews with Ombudsman’s Office and the Solidarity Center (aligned with the AFL-CIO).
65 Anecdotally, the Ombudsman’s Office cited concerns that receipt of benefits from local governments can be linked to TSA
eligibility. Source: Interview with Ombudsman’s Office.
Despite anecdotal claims that there has been general improvement in benefit and service delivery,66
particularly over the past decade, some key gaps remain. First, while citizens can complain directly to the
SSA branches, it is unclear whether there is a formalized mechanism for systematically reviewing and
addressing the complaints either within individual programmes or across the agency as a whole. There
is an internal Audit Service within the Ministry of IDPs that, together with the Control Department within
the SSA, monitors the achievement of certain officially defined programme performance indicators,
but it is unclear to what extent the performance reviews include complaints resolution. Applicants and
beneficiaries can refer to the regional SSA office with written complaints, or they can make a formal
complaint to the Public Defender (Ombudsman) of Georgia, which can then litigate on their behalf and
indeed has done so successfully on a number of occasions.67
Lifecycle benefits
Lifecycle benefits appear to be generally well administered once potential beneficiaries apply for
benefits. The emphasis at the SSA has been on ensuring the timely payment of benefits for applicants
who meet the criteria. Less attention has been paid, however, to identifying those who may be entitled
to a benefit but have not applied, or to providing clear pathways to address complaints from rights
holders. Many of these challenges can be traced to a reliance on self-selection and on-demand processes
and an associated failure to invest in awareness-raising or appropriate monitoring tools to strengthen
accountability.
For example, the administration of the state maternity benefit is carried out in a passive way. While there
may be limited data collection on the number of benefits paid and to whom, and claims appear to be
honoured, benefits are paid on a purely “on-demand” basis. There is no system in place for estimating
the latent beneficiary population, making it difficult to assess whether or to what extent the intended
population is being reached, nor are there any outreach programmes in place informing pregnant women
of their rights, though awareness does appear to be relatively high. The overall lack of targets, reporting
requirements and outreach around payment of maternity benefits results in an unknown number of
people not availing themselves of their right to paid maternity leave. Despite this, our estimates suggest
that the gap is likely small (see Section 4.3.1).69 Data on maternity benefits for civil servants are equally
scarce, as employers (separate ministries, departments and agencies) are responsible for managing
and paying their own benefits but do not appear to be required to report to any central oversight body.
With regard to disability benefits, potential beneficiaries are assessed by an approved medical
professional according to guidelines issued by the Ministry of IDPs.70 Once a potential beneficiary has
been assessed, the SSA must automatically approve the benefit application within 10 days. The Ministry
has engaged in outreach campaigns on an ad hoc basis. For example, information campaigns were
conducted for ethnic non-Georgians in 2018 and 2019 through the Social Care Policy Division. In addition,
communications materials about resources for people with disabilities were prepared and distributed
through SSA local offices and other institutions in multiple languages.71 There does not appear to be
systematic outreach to the disabled population by the Ministry to make people aware of their rights;
rather, the assessing medical professional is typically the key source of information on potential benefits.
Therefore, those who may not ask for an assessment (e.g. due to lack of knowledge, lack of resources or
stigma) may not be aware of their right.
66 This overall impression was confirmed by all sources in interviews.
67 For example, anti-discrimination cases have been filed and won on behalf of permanent residents, unmarried claimants
(e.g. where some municipalities asked for marriage certificates for benefits in families with children, despite this not being
required), and surrogate mothers who were denied maternity leave, among others. Source: Interview with Ombudsman’s
Office. See also http://www.ombudsman.ge/.
68 Eligibility criteria are summarized in Annex 1.
69 Job-protected leave appears to be widely respected by employers, and take-up rates of the state maternity benefit appear
to be relatively high, with caveats. See Section 4.3.
70 The Regulation Agency for Medical and Pharmaceutical Activities, within the Ministry of IDPs, certifies medical institutions
and professionals authorized to provide assessments. The agency also has the authority to conduct annual or intermittent
audits of the medical providers.
71 Written response from the Ministry of IDPs to questions about awareness-raising.

Similarly to the challenge with maternity benefits, while disability benefits appear to be smoothly
delivered once a person is assessed with a disability, the SSA is in fact unaware of the actual size of the
latent population of disabled persons who may not have received an assessment but who nonetheless
live with a disability. The lack of a system to monitor the effectiveness of the disability assessment
process creates a knowledge gap through which, inevitably, some otherwise eligible persons will fall.72
There is no disability-specific national survey against which to estimate the true size of the disabled
population, and the IHS only records information on those who have already been given an assessment.
As with maternity benefits, a lack of data collection for monitoring the size of the potentially affected
population, together with a self-selecting application process, increases the risk of exclusion of otherwise
eligible persons.
In employer-liability schemes (for cash sickness and employment injury), enforcement and dispute
resolution (e.g. over non-payment of benefits or fraudulent illness claims) rest with the court system
rather than a specific labour enforcement tribunal linked to the Ministry of IDPs, as is common in many
countries. There is no attempt within the Ministry to enforce compliance among employers or to monitor
claims in any way, although this will certainly change when the new legislation and regulations are
implemented and when labour inspectors are activated.73
With regard to sickness benefits, there is apparently no attempt to collect data on claims, nor are
there any clear lines of responsibility in terms of enforcing sick pay within the Ministry. This leaves the
Government effectively blind as to whether or not benefits are being paid, for how long, for what kinds
of conditions and for which types of beneficiaries.
Finally, the framework for regulating and enforcing employment injury compensation is particularly
weak, although the situation is set to improve with the imminent introduction of mandatory employment
injury insurance. Currently, however, courts determine both the responsibility of employers in causing
work-related accidents and diseases as well as the amount of compensation, as there are no guidelines
for the adequacy of benefits outside of whatever legal precedents have been laid down in the courts.
Non-lifecycle benefits
Without doubt, administration of the TSA, which requires complex data collection and information
management, has become a central focus of the SSA’s social protection delivery apparatus. By law,
households must be assessed and scored at least every four years, but they may be reassessed if social
services determine there is a need, and in practice, families are assessed more frequently.74 Potential
beneficiaries can self-refer or be referred by social workers. Knowledge of the programme appears to be
high among the general population, but it was not possible to validate this, and inevitably there will be
people in remote areas or otherwise marginalized individuals who are not aware of their right to apply
and may not be assessed.75
Some challenges that may, at first glance, appear to be administrative are actually linked to higher-level
policy design. As noted, even the most well-administered proxy means test will have a high potential
for exclusion errors. This fact, together with the reliance on highly automated systems for determining
eligibility in poverty-targeted programmes like the TSA, can reinforce feelings of disconnect with the
State. Therefore, it is not surprising that most of the complaints the SSA receives are related to the
administration of the TSA. Complicated rules around eligibility can discourage people from even applying
for assistance in the first place. Indeed, interviews with the SSA and the Ombudsman’s Office revealed
that the primary complaints they receive are related to people not understanding why they were rejected
for assistance.76 The Ombudsman’s Office specifically referenced the inability of recipients to validate
their assessment by social workers and a lack of understanding about the automated process, which is
computerized and based on the assignment of a coefficient to each household.77
72 See Sections 3.3 and 4.3.
73 See Section 4.1.2 and Annex 3.
74 Social services may terminate eligibility if there is no one living at the residence after three visits or if there are no fixed
utility payments. Source: Interviews with Ombudsman’s Office and SSA officials.
75 Indeed, the Ombudsman’s Office noted that homeless people, for example, are not assessed.
76 Interview with SSA officials and Ombudsman’s Office.
77 Interview with Ombudsman’s Office.

While application rates for assistance are relatively high in Georgia (around half the population), there
are still a large number of people who do not apply but are nevertheless vulnerable.78 Figure 2.13 shows
the reasons people give for not applying for assistance from the SSA. In the bottom two quintiles, more
than 70 per cent of respondents stated that they “did not hope to receive assistance” – that is, they did
not expect to qualify – despite their clear perceived need.
X Figure 2.13:
Reasons for not applying for assistance from the SSA, by quintile, 2018
100%
It’s difficult to answer
Other
80%
45% I consider it humiliating for my
Percentage distribution
55% family
63%
60% 70%
72% I can’t do it myself, and there is
2% no one to whom I can turn for
help
40% 4%
3% I don’t hope to get the
assistance
51%
3%
20% 7% 39% I don’t know where to apply
33%
22%
15% Our family doesn’t require social
0% assistance
Bottom 2nd 3rd 4th Top
Quintiles of households, ranked by per capita consumption
Source: Based on analysis of the 2018 IHS.
There is some evidence that the feedback mechanisms have led to improvements in programme
administration and, in some cases, to policy changes. For example, the Ombudsman’s Office noted that
a key complaint associated with the TSA was the fact that many people of working age were losing access
to benefits when they became employed, often in seasonal work. These complaints made their way to
policymakers, and the regulations were changed to allow continued receipt of the TSA for up to one year
after becoming employed.79 Overall, the Government appears to be responsive to calls for improving
the TSA. For example, the PMT formula has been revised a number of times, and the Government has
had a keen interest in transparency and accuracy around programme administration,80 but it is not clear
what role citizen feedback played, as opposed to programme evaluations and pressure from donors and
development partners, in sparking these changes.
78 Baum et al. (2016).
79 Interview with Ombudsman’s Office and the Deputy Minister of the Ministry of IDPs.
80 MISSOC (latest years).

2.5 Summary
The Georgian social security system, which is predominantly tax financed, reflects a legacy of historical
pendulum swings. Currently, it consists of a mix of lifecycle and non-lifecycle benefits (see Figure 2.6),
including the essentially universal provision of key lifecycle benefits (e.g. old-age and disability benefits);
a dependence on employers to provide certain others (e.g. sickness benefits and employment injury
protection); and a reliance on poverty targeting to attempt to reach those who are considered poor
(e.g. through the TSA and the CBP). The system also lacks key lifecycle provisions as would be called for
under ILO Convention No. 102: there is no employment injury scheme (yet), no unemployment insurance,
no survivors’ benefits for adults, and weak frameworks and low coverage for sickness and maternity
benefits.
The Government of Georgia already has a solid policy and administrative architecture for delivering key
lifecycle benefits on a universal basis. However, a number of administrative blind spots exist, especially
relating to disability, sickness and maternity benefits, creating challenges for the overall governance of
the system and the fulfilment of the right to social security. Notably, the biggest complaints from citizens
centre on the delivery of the poverty-targeted TSA, despite the programme being well administered by
most accounts. This is most likely a reflection of the programme’s design rather than administrative
failings, where even the most accurate proxy means test will have large exclusion errors.
There is potential for the generally effective benefits-delivery infrastructure and know-how, however, to
be exploited to extend the universal principles to other lifecycle contingencies – such as child benefits
or even maternity benefits – while also considering the potential for pooled arrangements to finance
short-term benefits like maternity and unemployment benefits. Importantly, non-lifecycle programmes81
like the TSA – which aim to offer a “last resort” against poverty – are not a substitute for the provision
of lifecycle benefits and will always leave a substantial number of people without coverage when they
need it.
The following chapters offer a brief assessment of the current system’s coverage (both horizontal and
vertical) for children, people of working age and older people, as well as the health benefits available
across the lifecycle.
81 See Annex 2 for a summary of the statutory features of non-lifecycle schemes.

X 3. Social protection for children in Georgia 35
X 3. Social protection for children in Georgia
Evidence strongly suggests that, besides being a fundamental component of international

recommendations for the development of national social protection floors, investing in children and
families is good for society and the economy at large.82 Children not only have a fundamental right to
social security (see Box 3.1) but also represent the future workforce, the future tax base and the future
caregivers for an ageing society like Georgia’s. Child benefits can be a key collective tool for alleviating
the costs parents bare in bringing up children, thereby freeing up resources within households for other
investments.
3.1 Context and overview of benefits for children
3.1.1 High child poverty, but low spending on child benefits

Worryingly, Georgia’s children are more likely than other age groups to be considered poor, as shown
in Figure 3.1. Children bore the brunt of the decline in welfare that occurred between 2016 and 2017.
Over that period, the share of the population with an income under the relative poverty line grew by 1.7
percentage points, and the proportion of children living in poor households grew from 26.8 per cent to
31.6 per cent.83 The extreme poverty rate among children increased significantly – by 5.4 percentage
points in urban areas and by 3.2 percentage points in rural areas. Moreover, the general poverty rate for
all children increased from 21.7 per cent to 27.6 per cent.84
X Figure 3.1:
Percentage of the population living in relative poverty (below 40 per cent and
60 per cent of median equivalized household consumption), by age group, 2018
14,6%
People above retirement age
4,9%
21,4%
Working-age adults aged 16+
8,4%
28,1%
Children aged 0-15 years
12,2%
0,0% 5,0% 10,0% 15,0% 20,0% 25,0% 30,0%
60% of median consumption 40% of median consumption
82 ILO and UNICEF (2019).
83 UNICEF (2018b).
84 Ibid.
According to analysis of the 2018 IHS, around 12 per cent of children (13.3 per cent of girls and 11.4 per
cent of boys) were living below 40 per cent of median consumption (the relative poverty line), compared
with only 8 per cent of people of working age (7.9 per cent of women and 8.9 per cent of men) and 5
per cent of people above retirement age (4.9 per cent of older women and 4.7 per cent of older men).
Similarly, close to 30 per cent of Georgia’s children (29.9 per cent of girls and 26.5 per cent of boys) are
living below 60 per cent of median consumption and are significantly worse off than other age groups.85
Global evidence shows that public spending on families lifts children and families out of poverty.
Countries with the most generous and family-friendly social security systems, such as Finland, Iceland,
the Netherlands, Norway and Sweden, rank highest on UNICEF’s multidimensional child well-being
index.86 Similarly, OECD countries that spend more on family benefits tend to have lower child poverty
rates, as shown in Figure 3.2.
X Figure 3.2:
Child poverty rates and public spending on child/family cash benefits and tax
breaks for children, OECD countries, 2015 or latest year available
0,30
Child povery rate (disposable income)
TUR
0,25 ISR
ESP
USA CHL
0,20 MEX LTU ITA
CAN
GRC
PR SVK
0,15 POL OECD NZL LUX
JPN EST HUN
NLD LVA DEU AUS GBR
CHE
0,10
CZE IRL AUT BEL FRA ISL SWE
KOR NOR
SVN
0,05 FIN DNK
0,00
0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0
Public social spending on families, % GDP
Source: Reproduced from OECD (2019, fig. 3.B).
However, Georgia currently spends far less on child-specific cash benefits than high-income countries,
which likely explains the high rates of child poverty. For example, on average, countries in the OECD
spend around 1.1 per cent of GDP on “family allowances” or cash benefits to families with children,
including both tax-financed and contributory benefits.87 As shown in Figure 3.3, in 2019 Georgia’s
spending on the CBP alone amounted to around 0.17 per cent of GDP, and although the figure rises to
85 See also Figure 5.1, which shows poverty rates by five-year age groups and sex.
86 See International Child Development Centre (2013).
87 OECD (2019), based on OECD Social Expenditures database: https://www.oecd.org/social/expenditure.htm.

0.38 per cent of GDP when including spending on other per-child transfers88 – and to 0.41 per cent when
including private-sector maternity benefits – the amount still falls well below the average amount spent
on child or family cash benefits in OECD countries.89
X Figure 3.3:
Spending on family (cash) benefits in OECD countries (2015) and Georgia (2019)
(percentage of GDP)
3,0
2,5
2,0
1,5
1,1
1,0
0,4
0,5
0,0
United States
Korea
Turkey
Georgia
Mexico
Spain
Portugal
Japan
Chile
Lithuania
Poland
Israel
Netherlands
Greece
Iceland
Germany
OECD - Total
Switzerland
Slovenia
Latvia
Italy
Canada
Norway
Denmark
Sweden
Finland
Slovak Republic
New Zealand
Czech Republic
France
Ireland
Hungary
Australia
Belgium
Austria
Estonia
Unted Kingdom
Luxembourg
Source: OECD Social Expenditures (SOCX) Database.
Notes: Data for Poland are from 2014. Cash benefits for families in the OECD database include maternity and
paternity benefits and include spending on both tax-financed and social insurance programmes.
Georgia also invests relatively less in children through child benefits than other countries at similar levels
of development, as shown in Figure 3.4. Despite the recent increases to the CBP, Georgia’s spending on
child benefits is low compared with the levels in Argentina and Mongolia, for example, which both pay
around 0.6 per cent of GDP, and South Africa, which invests much more (1.2 per cent of GDP) in its Child
Support Grant, which reaches around 70 per cent of children and has been very effective at reducing
child poverty and improving outcomes for children.90
As the experience of OECD countries shows, addressing child poverty and meeting children’s
multidimensional needs for a stronger future will require concerted investment in expanding child
benefits.
88 This more generous account of spending on per-child benefits in Georgia includes the TSA per-individual transfers paid
for children in the household (0.14 per cent of GDP), the Social Package survivors’ benefit (0.06 per cent of GDP), benefits
for first-, second- and third-born children in high mountainous settlements (0.02 per cent of GDP) and the Reintegration
Allowance (which is negligible). Data are from the SSA.
89 International comparisons of spending on child and family benefits are difficult to assess as programme designs vary
considerably from country to country. While aggregate OECD SOCX figures for cash benefits for families include spending
on maternity, paternity and parental benefits, the share of total family spending going to these versus child-specific cash
benefits varies greatly. For example, in Switzerland, cash maternity/paternity benefits amounted to around 11 per cent of
total family cash benefits, while in Portugal, it is more than a third. See https://data.oecd.org/socialexp/family-benefits-
public-spending.htm.

X Figure 3.4:
Spending on child (cash) benefits in select low- and middle-income countries

(percentage of GDP)
Fiji
Nepal
Kenya
Bangladesh
Georgia (CBP only) 0,2%
Brazil
Georgia (Total) 0,4%
Namibia
Chile
Argentina
Mongolia
South Africa
0,0% 0,4% 0,8% 1,2%

% of GDP
Source: Various. Georgia’s value is based on SSA data.
3.1.2 Key social protection schemes aimed at children

The Government of Georgia has expressed a strong commitment to protecting the rights of children,
including their right to social protection, as demonstrated by the adoption of the Code on the Rights of
the Child in 2019 (see Box 3.1).91 Similarly, the Government has embraced the need for child-sensitive
social protection through the introduction of a child-specific benefit – the CBP, within the framework of
the TSA in 2015 – as well as the recent decision to increase the benefit amount fivefold, from GEL 10 per
child to GEL 50 per child up to 15 years of age in qualifying families.
X Box 3.1: Protecting children’s rights in Georgia

The Code on the Rights of the Child, adopted by the Georgian Parliament in September 2019,
is a comprehensive legal document to safeguard and guarantee the realization of rights and
freedoms for children and to protect them against poverty and violence. The Code covers
all rights and freedoms as outlined in the 1989 UN Convention on the Rights of the Child,
including a special focus on social protection. As a state policy document, the Code will provide
a framework under which children’s right to social protection can be exercised. It contains
specific mechanisms that consider the needs and individual circumstances of the child and his
or her family, to ensure that the State will take the responsibility for the welfare of a child if a
family cannot do so.
91 UNICEF (2019).
At present, however, policies aimed at children in Georgia are predominantly based on a poverty-
targeting logic, leaving many vulnerable children without coverage. Before the introduction of the CBP
in 2015, evaluations of the TSA showed that poor households with children were less likely to qualify for
the TSA than were poor households without children; although reforms to the formula aimed to improve
this issue, large gaps still remain.92
However, Georgia stands out among low- and middle-income countries in offering universal disability
benefits to children, in recognition of the extra costs they and their families face as a result of the disability.
Furthermore, the child disability benefit contained in the Social Package is paid at the highest rate (GEL
220 per month), regardless of the child’s degree of disability or group classification, suggesting it could
be intended to go beyond simply compensating for the extra cost of raising a child with a disability.
Another distinctive feature of the benefits system in Georgia is that survivors’ benefits are only paid for
children. The Social Package contains a “death of a breadwinner” benefit paid to all children under the
age of 18 with one or two deceased parents. Most countries around the world provide a benefit for adult
survivors who not only have suffered the loss of a partner or spouse but – importantly – have also lost
income from work, a pension or other benefit that the partner was bringing into the household. This
constitutes a significant gap in social security provision, which affects women disproportionately as they
are less likely to generate their own income and have lower earnings on average, in addition to making
up the vast majority (86 per cent) of widow(er)s. Nevertheless, in this section we consider the legal and
effective coverage of children in terms of survivorship.
The main social protection income transfers paid on a per-child basis in Georgia include the following:
X Means-tested child benefits paid through the CBP within the framework of the TSA
X Universal child disability benefits paid as part of the Social Package
X Orphan benefits, known as survivors’ benefits, paid as part of the Social Package
The main statutory features of Georgia’s lifecycle benefits aimed at children are summarized in Table 3.1.
The following sections assess the extent to which children are legally covered, how effective existing
programmes are at reaching children and how adequate they are relative to various national and
international benchmarks.
3.2 Legal coverage of children

There is no universal child benefit in Georgia. Therefore, children can receive social transfers if their
families’ incomes fall below a certain threshold or if they become orphaned or disabled. Legal coverage
generally refers to the size and nature of the population legally or “technically” covered under each
programme according to law or statute. However, when regulations are excessively rigid, a broader, more
intuitive approach may be warranted.
Child benefit (CBP)

The CBP is by far the largest programme benefiting children in Georgia. Because child benefits in the
CBP are provided, by law, to children living in households with PMT scores of up to 100,000, technically
speaking, the size of the child population legally covered under the CBP is equivalent to the number
of children reported to be receiving the benefit. In other words, the legally covered population is
indistinguishable from the population that is covered in practice. According to administrative data from
the SSA, 137,505 children received the benefit in 2019. Analysis of the 2018 IHS suggests that around 14
per cent of all children report receiving the benefit.
Using a broader interpretation of the population of children intended to be covered by the CBP, we
might assume that, as the purpose of the benefit is to ensure that no child falls below the poverty line,
the size of the intended population is the size of the child population currently classified as poor. As we
saw in Figure 3.1, around 12.2 per cent of children in Georgia were living under 40 per cent of median
income, and around 28.1 per cent were living under 60 per cent of median income; therefore, it would be
92 Baum et al. (2016).

40
X Table 3.1:
Lifecycle social security schemes for children in Georgia
Statutory features of main schemes for children

Scheme Type of Regulatory Legally Financing Qualifying Description Administrative
scheme Framework covered arrangement conditions of benefits responsibility
population
Child Benefit Means- Law of Georgia Lawful State budget Children aged GEL 50 per child SSA
Programme93 tested, non- on Social residents 0–15 living in a per month
contributory Assistance (2006) of Georgia household with a
PMT score of up
to 100,000
X Assessment of the Social Protection System in Georgia
Child disability Universal Law of Georgia Lawful State budget Children aged 0–17 GEL 220 per SSA
benefit (non-means- on Social residents assessed child per month
(Social Package)94 tested, non- Assistance (2006) of Georgia with a Group I, II or
contributory) III disability
Survivors’ Universal Law of Georgia Lawful State budget Children aged 0–17 GEL 100 per SSA
benefit (non-means- on Social residents with one or both child per month
(Social Package) tested, non- Assistance (2006) of Georgia parents in most cases;
contributory) deceased up to GEL 144
per child per
month for
children of
certain veterans
93 A component of the TSA.
94 A component of the Social Package for People with Disabilities.

reasonable to assume that the CBP is intended to reach at least the bottom 12–28 per cent of children,
depending on the poverty line used.95
Disability and survivors’ benefits (Social Package)

Other benefits are provided on a universal basis to children who fall into certain categories, including
orphans (one or both parents), those who are assessed as disabled before the age of 18 and those who
are members of an internally displaced family. Therefore, legal coverage of these groups depends on
their size relative to the child population.
In theory, all children with disabilities in Georgia are entitled to receive Social Package transfers.
Regulations require that children be officially assessed as disabled before they are eligible to apply for
a benefit. The disability assessment process in Georgia has historically been based purely on a medical
assessment, though the Government is working with partners, including UNICEF, to shift towards a
“social model of disability”, which considers each child’s individual functional needs and abilities to enable
their full participation in society and the economy.96 However, according to UNICEF, “a significant number
of children with disabilities remain ‘invisible’ in Georgia, without social benefits or access to services, and
facing exclusion or discrimination.”97 Indeed, UNICEF cites the lack of reliable statistics on the number of
children with disabilities as a key challenge for the development of effective policies and programmes.98
According to the Global Burden of Disease, an estimated 5 per cent of children aged 0–14 worldwide are
reported to have some degree of disability, of which an estimated 0.7 per cent have “severe” disabilities.99
Likewise, from a legal coverage perspective, all children whose parent or parents are deceased have
the right to receive a so-called “death of a breadwinner” benefit as part of the Social Package. However,
the IHS does not collect information on the parental status of children, and there is no special status
of “orphan” assigned to children who have lost their parent(s). Therefore, we are unable to provide an
estimate for the size of the intended population in relation to the actual number of beneficiaries paid as
reported by the SSA.100
Table 3.2 summarizes the legal coverage of children under the three main lifecycle social protection
schemes in operation in Georgia.
3.3 Effective coverage of children

Due to challenges related to implementation and administration, the size and nature of the child
population actually reached by benefits may be significantly smaller than the legally covered population.
Overall, just over one in five children (21 per cent) in Georgia were receiving some social protection
benefit in 2018 (see Figure 2.5).101 This section examines the “effective coverage” of children under the
three main lifecycle benefits identified in more detail.
95 However, the pre-transfer poverty rates (and therefore intended coverage) would have been even higher.
96 UNICEF (2018a).
97 Ibid.
98 Ibid.
99 WHO and World Bank (2018).
100 There is an apparent attempt to begin registering single mothers as a special category, but there do not appear to be
plans to link this designation to the receipt of the Social Package benefit or any specific cash benefit (source: interview
with Caritas). Equally, the 2018 IHS has a special-status category for single parents of a child under the age of 16, but there
were no respondents who reported having this characteristic.
101 Based on analysis of the 2018 IHS.

X Table 3.2:
Percentage of children legally covered by three main lifecycle schemes in Georgia
Coverage Child Benefit Child disability benefit Survivors’ benefit

Programme (CBP) (Social Package)
Target group All children up to Children with Children with
age 16 living in disabilities (assessed one or both
households with PMT with Group I, II or parents deceased
scores up to 100,000 III disability)
Share of all children 14% of children Actual share of Actual share of
children with orphans in wider
disabilities in child population unknown
population unknown;
global estimates are
around 5%
3.3.1 Horizontal coverage
Child benefit (CBP)

According to the 2018 IHS, around 14 per cent of children in Georgia reported receiving the CBP, of whom
around 2.4 per cent were not living in households that qualified for the TSA (that is, their PMT scores were
between 65,000 and 100,000), and 11.6 per cent were living in TSA households and therefore receiving
both the TSA and the CBP.
Recent improvements to the PMT formula do appear to have achieved certain desired “efficiency” gains
in the delivery of the CBP, as shown in Figure 3.5, where the benefits are largely concentrated among
the lower-wealth deciles, with very few people in upper-income deciles receiving the benefits. (However,
children in the top decile are still more than three times more likely to receive a child benefit than those
living in the seventh, eighth and ninth deciles.) Even with these gains, the child benefit only reaches 43
per cent of children in the lowest consumption decile and only 25 per cent and 11.2 per cent of children
in the second and third deciles, respectively. Effectively, more than half of those in the poorest decile
are excluded from the programme, and many more children living in vulnerable circumstances cannot
count on income security from the CBP, despite the fact that it is designed precisely with them in mind.
Analysis of administrative data also confirms that, in absolute terms, the number of children receiving
benefits has risen since 2015 when the CBP was introduced, in line with the Government’s policy goals
of making the TSA more child-sensitive. The number of children under the age of 16 reported to have
received the TSA or child benefit went from around 97,000 children in 2015 (when the CBP was first
introduced) to around 140,000 registered to receive benefits in 2020. Moreover, this apparent increase
in coverage of children appears to have come partly at the expense of TSA households, as is evident in
Figure 3.6, where the number of households receiving the TSA declined from 163,000 in 2012 to 120,000
in 2020.
X Figure 3.5:
Percentage of children aged 0–15 receiving the CBP, by consumption decile
100%
90%
80%
Percentage of children
70%
60%
50% 43,0%
40%
25,0%
30%
11,2%
20% 8,7%
4,4%
10% 1,4% 0,4% 0,8% 1,5%
0,3%
0%
Bottom 2nd 3rd 4th 5th 6th 7th 8th 9th Top
X Figure 3.6:
Evolution in the numbers of children receiving the CBP versus the number of
TSA-recipient households
170000
160000
150000
140000
130000
120000
110000
100000
90000
80000
2012 2013 2014 2015 2016 2017 2018 2019 2020
Number of children under 16 years of age receiving CBP
Number of households receiving TSA transfers
Source: SSA administrative data.

On average, the likelihood of receiving a child benefit increases with age, as shown in Figure 3.7, with
only 8 per cent of parents of newborns claiming the benefit but nearly double that – around 16 per cent –
for children aged 9 or older. This variation could reflect administrative challenges that result in delays in
registering children or could indicate a lack of knowledge of the programme among first-time parents.
X Figure 3.7:
Percentage of children aged 0–15 receiving the CBP, by age, 2018
20,0%
15,0%
10,0%
5,0%
0,0%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Age of child (years)
The 2018 IHS also reveals large variation in the percentage of children from different ethnic backgrounds
who receive the CBP (see Figure 3.8). More than a quarter of ethnic Russian children live in households
with PMT scores that qualify them for benefits, despite the fact that ethnic Russians make up only 0.7 per
cent of the total population. In contrast, around 14 per cent of ethnic Georgians qualify, while Abkhazian,
Greek and Ossetian children are least likely to qualify for the CBP. These differences in part reflect higher
degrees of vulnerability among certain ethnicities but also potentially point to gaps in administrative
capacity to reach certain marginalized populations.
The analysis revealed only a very slight gender gap among those receiving the CBP, where around 15 per
cent of girl children receive the benefit, compared with 13 per cent of boys. Equally, there is no observable
difference in the gender make-up of CBP beneficiaries, which is not surprising as there is unlikely to be a
gender imbalance among children in CBP households. In contrast, women make up a larger share of TSA
recipients, as shown in Figure 3.9, reflecting the larger share of older women who claim the TSA (due to
their longer life expectancy). Indeed, only 13 per cent of male TSA recipients are above retirement age,
compared with 42 per cent of female TSA recipients.
X Figure 3.8:
Percentage of children aged 0–15 receiving the CBP, by age, 2018
Russian 25,3%
Georgian 14,3%
Azerbaijani 12,7%
Armenian 11,9%
Ukrainian 8,3%
Other 4,1%
Ossetian 2,8%
Greek 0,0%
Abkhazian 0,0%
0% 5% 10% 15% 20% 25% 30%
X Figure 3.9:
Gender make-up of CBP and TSA beneficiaries, 2018 (percentage)
Gender distribution of CBP Gender distribution of TSA
41.3
49.4
50.6
58.7
Female Male Female Male

Disability benefit (Social Package)

According to analysis of the 2018 IHS, less than 1 per cent (0.9 per cent) of Georgia’s children are receiving
a child disability transfer. While this represents almost all (around 99 per cent according to the 2018 IHS)
of the children who have been officially assessed as disabled, global estimates suggest that a potentially
large number of children with disabilities are being missed.102
Claims for the child disability benefit are somewhat dispersed across the distribution, partly reflecting
the benefit’s universal nature, as shown in Figure 3.10. However, global evidence suggests that disability
prevalence is typically higher among the lower-income and wealth quintiles.103 In Georgia, the share of
children claiming the child disability benefit is larger in the higher ends of the wealth distribution than
in the lower deciles. This discrepancy could reflect a resource and knowledge imbalance, where poorer
households might be less likely to seek assistance for their child with disabilities, to be aware of the
benefits or to have the resources to travel in order to claim the assistance. However, this difference could
also reflect negative attitudes towards disability, where parents of children with disabilities do not apply
for benefits for fear of being stigmatized.
X Figure 3.10:
Percentage of the population aged 0–15 receiving a child disability benefit (Social
Package), by per capita consumption decile
1,6%
1,4%
Percentage of population
1,2%
1,0%
0,8%
0,6%
0,4%
0,2%
0,0%
In addition to the likely underreach of the child disability benefit, certain inequalities in the benefit
distribution can be observed. For example, girl children are more than two and a half times more likely
to receive the disability benefit than are boys, where 1.3 per cent of girls claim the benefit compared
with only 0.5 per cent of boys. On the other hand, children in rural and urban areas appear to be equally
represented among beneficiaries.
103 Ibid.
Survivors’ benefit (Social Package)

Analysis of the IHS shows that around 1.8 per cent of children in Georgia are receiving the benefit for
children who have lost either one or both of their parents. Based on household and administrative data,
we can observe a number of patterns in the distribution of survivors’ benefit recipients. For example, the
likelihood of a child receiving the survivors’ benefit increases significantly with the child’s age, as shown
in Figure 3.11. The variation could reflect a higher mortality rate among parents of older children, who
themselves tend to be older and have been more exposed to risks.
X Figure 3.11:
Percentage of children receiving the survivors’ benefit (Social Package), by age,

2018
5,0%
4,5%
Percentage of all children
4,0%
3,5%
3,0%
2,5%
2,0%
1,5%
1,0%
0,5%
0,0%
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Age (years)
The likelihood of receiving a survivors’ benefit also varies depending on where the child lives, his or her
ethnicity and other characteristics. For example:
X 3.1 per cent of ethnically Armenian children claim the survivors’ benefit, followed by 1.9 per cent of
ethnically Georgian children and 0.8 per cent of Azerbaijani children, while no survivors’ benefits were
claimed by children of Abkhazian, Greek, Ossetian, Russian or Ukrainian ethnicity.
X Children in rural areas are more likely to receive the benefit (2.1 per cent) than those living in urban
areas (1.6 per cent).
X The share of internally displaced children (5.7 per cent) and “chronic patients” (5.5 per cent) receiving
the survivors’ benefit are more than three times higher than average.
Finally, Figure 3.12 shows some sizeable differences in the distribution of survivors’ benefit recipients
according to the where they live, with children living in Samtskhe-Javakheti much more likely to receive
the benefit than children living in Guria or Kakheti, for example.
Interestingly, according to administrative data, the number of children receiving the Social Package
survivors’ benefit appears to have been steadily declining over at least the past decade, as shown in
Figure 3.13. This could potentially be explained by the fact that children who lost a parent in armed
conflict, the most recent of which occurred in 2008, are gradually ageing out of the programme.
X Figure 3.12:
Percentage of children receiving survivors’ benefits, by region, 2018
Samtskhe-Javakheti
Imereti; Racha-Lechkhumi and Kvemo Svaneti
Kvemo Kartli
Shida Kartli
Samegrelo-Zemo Svaneti
Tbilisi
Adjara A.R.
Mtskheta-Mtianeti
Guria
Kakheti
0,0% 0,5% 1,0% 1,5% 2,0% 2,5% 3,0% 3,5% 4,0% 4,5%
X Figure 3.13:
Trend in the number of children receiving survivors’ benefits, 2012–2019
30 000
Number of beneficiaries
25 000
20 000
15 000
10 000
5 000
-
2012 2013 2014 2015 2016 2017 2018 2019
Source: Based on SSA administrative data

3.3.2 Vertical coverage (adequacy)
Child benefit
X Box 3.2: Setting child benefit values according to benefit objectives

Traditionally, direct cash benefits paid to parents in respect of child benefits have had the
primary purpose of compensating caregivers for the direct costs of children through some
form of horizontal redistribution (from childless persons to parents or caregivers). In this sense,
child benefits use a similar logic to disability benefits; they are designed to compensate (but
only in part) for the “extra” cost of having a child and therefore allow households to maintain
a reasonable standard of welfare. However, it is important to emphasize that the “cost” of a
child is a function of the relative mix of public and private services available to families raising
children, and there is no “correct” or international best practice for estimating such costs.104
Setting adequate benefit levels is inherently subjective, but it is particularly challenging when examining
benefits for children, since international guidelines for setting adequate child and family benefits are
either lacking in specifics or arguably based on outdated notions of a family model with one male
breadwinner. ILO Convention No. 102, for example, suggests a benchmark of 3 per cent of an ordinary
adult male labourer. 105
However, the rationale for child benefits is typically linked to the notion of sharing the cost of raising
children or taking into account the needs of the child, as explained in Box 3.2.106 Furthermore, the
benchmark suggested in Convention No. 102 appears to be low relative to what countries around the
world actually spend (see Figure 3.14). Moreover, Recommendation No. 202, in calling for basic income
security for children, leaves the determination of minimum levels to individual countries to define
according to national standards, provided they ensure that the child can access “nutrition, education,
care and any other necessary goods and services.”107 Despite these drawbacks, to our knowledge, the
Convention No. 102 standard is the only international standard for calculating child benefits, so we will
examine the Convention’s levels in the Georgian context.
Part VII of Convention No. 102 establishes minimum standards for family benefits to be paid in respect of
children. Article 44 offers two means of calculating the total value of benefits: “(a) 3 per cent of the wage
of an ordinary adult male labourer… multiplied by the total number of children of persons protected; or
(b) 1.5 per cent of the said wage, multiplied by the total number of children of all residents.”108
We can understand the two rates as reflecting options for contributory and non-contributory systems:
whereas the former, higher-rate value would have been intended to apply to workers covered under
social insurance arrangements, the latter, lower-rate value would apply for tax-financed child benefits
paid in respect of all resident children.109 Table 3.3 presents the values that would be derived using the
average wage for elementary occupations (for both women and men) as the reference wage.
104 See James and McClanahan (2019) for a fuller discussion of the rationale for setting child benefits according to the benefit’s
objectives.
105 ILO (1952).
106 A systematic review of evidence from Europe found that the relative cost of a child represents 20–30 per cent, or around
a quarter, of the budget of a couple without children. See Letablier et al. (2009).
107 ILO (2012).
108 ILO (1952).
109 Ibid. According to Article 43, “The benefit specified in Article 42 shall be secured at least to a person protected who, within
a prescribed period, has completed a qualifying period which may be three months of contribution or employment, or one
year of residence, as may be prescribed.”
X Table 3.3:
Minimum adequate child benefit levels in Georgia according to C102
Scheme Monthly value of Average monthly C102 minimum C102 minimum

existing benefit nominal wage standard of 1.5% standard of 3%
of elementary (per month) (per month)
occupations (2017)110
CBP GEL 50 per child GEL 581.20 GEL 8.72 per child GEL 17.44 per child
Unsurprisingly, the value of the CBP in Georgia far surpasses these minimal benchmarks, as do most child
benefits provided around the world. Given the lack of robust international guidelines on the appropriate
value of child benefits, it is more useful to compare Georgia’s experience with that of other countries, as
shown in Figure 3.14.

Children with disabilities, and their families who care for them, face additional costs in enabling them to
fully participate in society.111 To our knowledge, there are no international standards to assess the value
of child-specific disability benefits, as the standards in the relevant ILO Conventions – Convention No.
102 and the Invalidity, Old-Age and Survivors’ Benefits Convention, 1967 (No. 128)112 – were defined with
adults in mind, in relation to the lost or foregone wages due to disability (primarily) plus the additional
cost of being disabled. (Section 4.3.2 offers a discussion of the adequacy of adult disability benefits.)
However, it is probably safe to assume that, since the disability benefit for children is set at the highest
level applicable for adults (GEL 220 per month), such benefits would likely be considered adequate by
most measures.
In Europe, most systems provide some financial support to the parents of children with disabilities.113
However, there is enormous variability in the design of benefits, with some replacing lost income for
carers and others offering extra support for the cost of disability, while still others are a combination
thereof. Benefits may also be tax-financed or provided through the social insurance systems (which enjoy
wide coverage). Often, the upper age limit for eligibility for child benefits or survivors’ benefits is lifted for
children with disabilities so that families with disabled dependants can continue to receive said benefits,114
or in some cases, the child benefit amount is increased (as in Latvia, Malta and the Netherlands).115 Like
Georgia, a few countries (e.g. Ireland, Luxembourg and the United Kingdom116) provide a flat-rate benefit
regardless of the level of disability, while others only provide specific allowances for severe disabilities
(e.g. Latvia117). Often, however, the level of support varies according to the child’s assessed degree of
disability, as, for example, in Belgium, Bulgaria, Estonia, Finland, France, Lithuania, Poland, Portugal,
Slovenia and Spain.118 Some countries, such as Croatia, Denmark, Norway and Slovenia, also provide
paid leave to parents who are unable to work due to care responsibilities, while still others, such as Italy,
Latvia and Poland, may provide other forms of subsidies to cover specific extra costs, such as those for
schooling and home-care assistance.
110 2017 is the latest year of data available on average monthly nominal wages in elementary occupations. This means that
the recommended minimally adequate values are underestimated. See Geostat: https://www.geostat.ge/en/modules/
categories/39/wages.
111 James and McClanahan (2019).
112 ILO (1967).

X Figure 3.14:
Comparison of per-child benefit values around the world, latest year available
(percentage of GDP per capita)
Canada
Uzbekistan
Germany
Argentina
Slovenia
Netherlands
Namibia
South Africa
Malta
Hungary
Nepal
Bangladesh
Iceland
France
Fiji
Georgia 4,6%
Zambia
Bulgaria
Italy
Mongolia
Japan
Denmark
Estonia
Luxembourg
United Kingdom
Austria
Portugal
Finland
Kenya
Switzerland (Zurich)
Belgium
Poland
Lesotho
Romania
Lithuania
Pakistan
Norway
Slovak Republic
Brazil
Sweden
Czech Republic
Spain
Latvia
Viet Nam
Greece
0% 2% 4% 6% 8% 10% 12% 14%
Percentage of GDP per capita
Source: OECD Family Database (http://www.oecd.org/els/soc/oecdfamilydatabasethefamilysupportcalculator.htm)

and various national sources.
Equally, very few low- and middle-income countries provide specific allowances for children with
disabilities, which, together with the complexity across European systems, offers limited opportunity
for drawing conclusions from international comparisons. However, Figure 3.15 shows a selection of tax-
financed disability transfer values as a percentage of GDP per capita based on available data.
X Figure 3.15:
Child disability benefit transfer values in select countries, latest year available
(percentage of GDP per capita)
Uzbekistan
Russian Federation
Georgia 20%
Azerbaijan
Namibia
Mauritius
Brunei
0% 5% 10% 15% 20% 25% 30% 35% 40%
Source: Development Pathways (2019) based on national administrative data and various secondary sources.
Georgia’s level compares quite well with these limited examples. However, the fact that Georgia’s child
disability benefit is not only paid at the highest level for Social Package disability benefits but is also on
par with other benefits designed to replace lost wages (such as the old-age pension) makes it difficult to
determine the intended function of the benefit. If it is intended to replace the lost wages of a parent or
caregiver who must care for the child, one measure of adequacy might be appropriate; however, if it is
intended to cover the extra costs of a disability, another benchmark may be relevant.119
113 Notable exceptions in Europe include Germany, Greece, Hungary and Lichtenstein, and only two cantons in Switzerland
provide supplemental allowances. See MISSOC (latest years).
114 Based on analysis of ISSA/SSA (multiple years).
115 Based on analysis of MISSOC (latest years).
116 In Ireland, €309.50 per month is paid for children up to the age of 16, which amounts to 5.36 per cent of GDP per capita;
in Luxembourg, the supplementary allowance is €200 per month, which amounts to 2.39 per cent of GDP per capita.
117 Latvia provides €313 per month for children with severe physical and functional disturbance, which amounts to 23.21 per
cent of GDP per capita. The country also provides a transport allowance and an increased child benefit for all children with
disabilities.
118 The amounts range from a low of €82 per month in parts of Belgium (2.45 per cent of GDP per capita) to a high of €1,121
in France (36.18 per cent of GDP per capita).
119 See Section 4.3.2 for a discussion of appropriate benchmarks for assessing the adequacy of disability benefits more
generally.
Survivors’ benefit (Social Package)

As noted, survivors’ benefits are only paid to children in Georgia. This makes assessing their adequacy
relative to international conventions or to other countries, which also pay survivors’ benefits to adult
survivors, particularly challenging. ILO Convention No. 102 suggests that the minimum level of a survivors’
benefit under a tax-financed system is 40 per cent of the prevailing wage of a manual labourer,120 but this
was intended to provide protection to a surviving spouse and two children. When assessing the adequacy
of Georgia’s survivors’ benefit, which is paid for a single child, there are no international guidelines.
However, taking a third of the value suggested in Convention No. 102 would give a minimum single-child
survivors’ benefit value of GEL 77.50 per month, which is below what Georgia pays, as shown in Table 3.4.
X Table 3.4:
Adequacy of survivors’ benefit (Social Package) relative to C102 standards
National Value of Average monthly C102 adequate Adequate survivors’

benefit national nominal wage survivors’ pension based on one
benefit of elementary pension of 40% third of C102 survivors’
occupations (2017)121 (per month) pension (single child)
Social Package GEL 100 GEL 581.20 GEL 232.50 GEL 77.50
survivors’
benefit
As with all benefits, the “true” adequacy of the benefit should be based on the degree to which the
benefit protects the child survivor from falling into poverty (at the very least) and ideally allows the child
survivor to maintain his or her standard of living prior to losing a parent. In this sense, a benefit set at
GEL 100 – which is more than five times below the average wage of a manual worker – would in most
cases not come close to replacing the lost income associated with the death or disappearance of a parent.
3.4 Summary
Children are significantly more likely than other age groups to live in poverty: around 12 per cent of
children were living below 40 per cent of median consumption (the relative poverty line), compared with
only 8 per cent of people of working age and 5 per cent of people above retirement age. And many more
children are at risk of poverty, with nearly 30 per cent living below 60 per cent of median consumption.
Whereas overall, just over one in five children in Georgia receives a social protection benefit, only
around 14 per cent, including less than half in the poorest income decile, receive a child benefit under
the Government’s flagship CBP within the framework of the TSA. Therefore, the CBP is still missing a
significant number of children who are otherwise vulnerable, despite the Government’s commitment to
improving the targeting formula.
120 See Sections 4.3.2 and 5.3.2 for a more detailed discussion of the assumptions and methodology of the suggested
minimum standards in ILO Convention No. 102.
At the same time, while lifecycle benefits provided under the Social Package (disability and survivors’
benefits) seem to be effectively reaching those who apply (and for disability benefits, those who are
assessed as disabled), a lack of knowledge about the true size of the disabled child population or child
survivor population prevents us from knowing how many children who might legitimately qualify for
these benefits could be excluded, whether due to lack of knowledge of their rights or other barriers to
access.
The assessment also suggests that, on the whole, existing benefits for children are adequate, largely
due to recent policy changes that increased the CBP by five times its previous value. However, a lack
of robust international standards for measuring adequacy prevents a definitive qualification. Rather,
adequacy is more effectively assessed within the national context based on close study and evaluations
of beneficiary populations and within a framework of nationally relevant benchmarks, of which there is
currently a deficit in Georgia.
Table 3.5 summarizes the legal and effective coverage of children through lifecycle benefits in Georgia.
The next chapter turns to the social protection coverage of people of working age in Georgia.
X Table 3.5:
Summary of legal and effective coverage of children in Georgia
Dimension Child Benefit Child disability benefit Survivors’ benefit

of coverage Programme (CBP) (Social Package) (Social Package)
Target All children up to age Children with disabilities Children with one or
group 16 living in households (assessed with Group both parents deceased
with PMT scores I, II or III disability)
up to 100,000
Legal coverage
(Or all poor children)

Share of all 14% of children Actual share of children Actual share of
children with disabilities in child orphans in wider
population unknown; population unknown
global estimates
are around 5%
(Or the poorest
12%–28% of children)
Horizontal 14% of all children, but: 0.9% of all children, but: 1.8% of all children, but:
(extent of
X Only 43% of children X Nearly all (99%) X Unknown number of
population)
in the lowest children assessed children who have
Effective coverage
consumption decile as disabled lost a parent but

X Only 25% in the X Unknown number of have not applied
second lowest unassessed children for benefits
consumption decile
Vertical
(adequacy/
Medium to high Medium to high Medium to high
level of
benefit)
X 4. Social protection for people of working age in Georgia 55
X 4. Social protection for people of working age in

Georgia
People of working age are the engines of a thriving economy. But at any given moment, they can fall ill,
become disabled, lose their job or simply decide to grow their family. A robust social protection system
that can offer security for these common lifecycle risks can ensure that workers not only stay out of
poverty but also can continue to be productive.
4.1 Context and overview of benefits for working-age people
4.1.1 High informality and unemployment,

especially among younger people
Georgia’s official unemployment rate remains relatively high (at 11.6 per cent in 2019), and the uneven
sectoral distribution of the country’s growing workforce continues to be a challenge. In 2019, the urban
unemployment rate (17.4 per cent) was more than three times the rural unemployment rate (5.5 per cent)
mainly due to disproportionally high levels of employment in the agricultural sector, which makes up 39
per cent of the country’s entire labour force.122 Men were slightly more likely to be officially unemployed,
at 11.2 per cent for women compared with 13.8 per cent for men.123
Importantly, youth unemployment is also on the rise, reaching 30.9 per cent in 2019.124 Likewise, according
to the World Bank, the share of youth who are not in employment, education or training (NEET) grew
from 24.8 per cent in 2017 to 26.9 per cent in 2019.125 Young women are more likely to be NEET than young
men. In 2019, 35 per cent of women aged 15–24 were NEET, compared with 27 per cent of men in the
same age group.126
Like many countries in the region, Georgia struggles with high levels of informality. High informality not
only poses challenges for workers but also further limits the State’s ability to raise revenues through
the income tax system, potentially creating a vicious cycle. Therefore, addressing informality is key to
extending coverage, regardless of whether this occurs through contributory or tax-financed schemes.
The challenges facing workers employed in the informal economy are well documented.127 In general,
people working informally are much more likely to have low incomes and lower levels of education, be
self-employed and work in non-standard employment, including in part-time and temporary work. They
often face irregular (very short or excessively long) hours, where they are more likely to be exposed to
work-related health and safety risks. Where social protection is tied to formal employment, workers in
the informal economy can miss out on key protections. Women working informally in Georgia can be
particularly vulnerable. For example, women working informally earn, on average, around 42 per cent
less per year than those in formal employment.128 Moreover, informally working women perform almost
all informal paid care work (domestic work), which lacks basic protections.129
A lack of formal jobs in Georgia accounts for significant underemployment as well as prevalent self-
employment rates. More than a third of non-agricultural workers are informally employed, and the share
of informal employment in total non-agricultural employment rose from 33.9 per cent in 2017 to 36.2 per
122 See Geostat: https://www.geostat.ge/en/modules/categories/38/employment-and-unemployment.
123 UN Women (2020b) based on analysis of the 2018 LFS.
124 See ILOSTAT database: https://data.worldbank.org/indicator/SL.UEM.1524.ZS?locations=GE.
125 See ILOSTAT database: https://data.worldbank.org/indicator/SL.UEM.NEET.ZS?locations=GE.
126 See ILOSTAT database: https://data.worldbank.org/indicator/SL.UEM.1524.MA.NE.ZS?locations=GE.
127 ILO (2018a, 2019).
128 Ibid.
129 UN Women (2018).

cent in 2018, as shown in Figure 4.1. Overall, men are significantly more likely to be informally employed
(41.5 per cent) than women (29.8 per cent), and rural workers (40 per cent) are more likely than urban
workers (34.6 per cent) to be informally employed.
Women face unique challenges due to the combination of their life course and highly gendered labour
markets. Indeed, the official unemployment and informality rates above mask more complex dynamics.
Women are in fact much more likely to be inactive than men: whereas 73.6 per cent of men were active in
the labour market, only 55.6 per cent of women were. Women’s lower labour force participation is largely
due to the fact that women are far more likely than men to be caregivers and to take time out of paid
employment for family leave and child-rearing.130 In Georgia, women spend three times as much time
as men on unpaid care responsibilities.131 This time spent outside of paid employment can have serious
implications for women’s ability to advance in their career, earn higher salaries or accumulate sufficient
contribution credits to earn entitlement to benefits in contributory schemes.132
High levels of unemployment and informal employment among men and women can also be attributed
to skills mismatch in the labour market. Due to the lack of jobs, the transition from school to work
is particularly difficult, resulting in the underutilization of the high potential of young workers.133
Furthermore, many of the jobs that require vocational skills are occupied by workers with tertiary
education; hence, the country faces the challenge of so-called “overeducation”, resulting from heavy
investment in higher education (an important component of the SEDP) but low demand for a highly
skilled workforce.134 As a result, the flow of emigrants leaving Georgia in search of formal employment
is increasing.135
X Figure 4.1:
Share of informal employment in total non-agricultural employment, 2017 and

2018
50%
40%
30%
20%
10%
0%
Female Male Urban Rural Total
2017 2018
Source: Geostat.
130 ILO (2018b).
131 Ibid.
132 See also Section 5.3.2 for a discussion of the implications of these labour market inequalities for the ability of women
in Georgia to accumulate adequate savings in the new accumulated pension system. Being female and unemployed or
inactive is also associated with worse economic conditions, lower quality of life and adverse attitudes towards women’s
role in society. See UN Women (2018).
133 Baum et al. (2015).
134 Rutkowski (2013).
135 See Geostat data for the past five years: https://www.geostat.ge/ka/modules/categories/322/migratsia.
Photo: ILO/Levan Gorgidjanidze
While these structural challenges require a long-term and concerted combination of economic and labour
market policies, social security has a fundamental role to play. For example, an unemployment insurance
scheme could go a long way towards providing the income security during periods of unemployment
that would give people the resources and the confidence to search for a new job, invest in starting a
business or re-skill to adapt to a growing and changing economy. And adequate and equitable parental
benefits can ensure that families not only offer their children a good start in life but also can maintain
their standard of living during parental leave and not worry about being able to return to their jobs.
4.1.2 Key social protection schemes aimed at working-age people

In recent decades, compared with older people and children, relatively little attention has been paid
to ensuring social security for people of working age. As with children, the policy and political space
around social protection has been occupied by the TSA. One might think that because the TSA is aimed
at families, it would benefit people of working age, but in fact, analysis of the 2018 IHS reveals that people
of working age are the least likely to benefit from the programme: 7.2 per cent of working-age people
enrolled in the programme, compared to 8.7 per cent of older people and 11.6 per cent of children.136
Unlike benefits during the vulnerable life stages of childhood and old age, many social security benefits
for people of working age are of a short-term nature. Long-term disability is an exception, and in fact, of
the Convention No. 102 lifecycle contingencies aimed at people of working age, Georgia provides regular,
predictable transfers only for general disability. In truth, the fact that Georgia provides universal benefits
for people with disabilities is often overlooked in comparative studies of social protection systems.

Currently, cash maternity benefits in Georgia are uneven and, at least for the private sector, largely
inadequate. Women employed in the civil service receive the most generous benefits in the form of
six months of paid leave at their full salary, as well as an additional year and a half of unpaid leave with
guaranteed job protection.137 Women who are formally employed in the private sector and the majority
of public-sector workers, however, are ostensibly offered paid leave, financed by the state budget, for six
months. However, the total amount of benefit they can receive is GEL 1,000, which is paid as a lump sum
rather than as periodic payments. Finally, there is no income security provided for all of those women
who are self-employed, unemployed or otherwise outside the labour force.
Other working-age contingencies are only minimally covered in Georgia. There is only limited protection
provided for cash sickness benefits through the Labour Code. A nascent employment injury scheme
would require certain employers to self-insure with private carriers to cover the risks of work-related
accidents and diseases, but the exact terms have not been defined. And as mentioned previously, there
is currently no unemployment insurance,138 and there are no benefits for adult survivors faced with lost
income due to a partner’s or spouse’s death.
During working age, people can expect to receive the following lifecycle benefits in Georgia:
X Disability benefit (Social Package)
X Maternity benefits (state benefit for private sector and non-civil servants employed in the public
sector, and employer liability for civil servants)
X Paid sick leave (cash sickness benefits)
Table 4.1 summarizes the key statutory features of the main schemes in operation for people of
working age. It includes the forthcoming employment injury scheme, but since it has not yet been fully
implemented, we exclude this benefit from the effective coverage sections. Further, while we occasionally
refer to benefits for the public sector, we focus in this section on benefits for persons working in the
private sector, in line with international comparisons and available data.
The following sections assess the extent to which working-age adults are legally covered for the
contingencies outlined in Convention No. 102; the effectiveness of existing programmes at reaching
said adults when they experience these contingencies; and the adequacy of the existing lifecycle benefits
relative to various national and international benchmarks.
137 Regulated under the Law on Public Service.
138 The Government’s response to the COVID-19 crisis includes a temporary unemployment programme to last six months.
X Table 4.1:
Lifecycle social security schemes for people of working age in Georgia
Statutory features of main schemes for children
Scheme Type of Regulatory Framework Legally covered Financing Qualifying Description of benefits Administrative
scheme population arrangement conditions responsibility
Disability Universal Law of Georgia on Social Lawful residents State budget Assessed with a GEL 220 per month for a SSA
pension (non-means- Assistance (2006) of Georgia Group I, II or III severe disability (Group I);139
(Social tested, non- disability GEL 140 per month for a
Package) contributory) significant disability (Group
II); GEL 100 per month for a
Group III disability if disabled
from childhoodh
Temporary Employer Ministerial Order No. 87/n Employed Employer Must be currently 100% of the previous salary Employers pay
cash sickness liability on the Approval of the persons pays benefits employed, have and any allowances for up to benefits directly
benefits Allocation and Provision directly to undergone a 30 days (may be extended in to employees
of Aid due to Temporary the employee “temporary certain
X 4. Social protection for people of working age in Georgia

Disability (2009) and disability circumstances)
Ministerial Order No. examination”
281/n on Temporary and present a
Incapacity Appraisal and hospital
Rules for Providing Sick- certificate
Leave Certificate (2007))
Maternity Employment Labour Code of Georgia, Women State budget Must be currently A lump sum equal to the full SSA
benefit related Chapter VI (2013) employed in the employed and salary for six months (183
(private private sector Employer prove pregnancy days) or GEL 1,000, whichever
sector) 140 and public-sector must apply or adoption of is lower
workers who are to the SSA to a newborn
not civil servants receive funds
Employment Employer Labour Code of Georgia, Persons Compulsory No minimum Full compensation for Labour
injury liability Chapter VIII (2013) employed insurance qualifying work-related injury, illness Conditions
insurance in arduous through a period (includes occupational Inspecting
(not yet Law of Georgia professions private carrier disease) or loss, as well as Department
implemented) on Occupational as defined by costs of treatment (amount of of the Ministry
Safety (2018, not law/regulation permanent disability pension of IDPs
yet implemented) (Decree No. 381) not yet defined)
139 Higher-rate benefits may be paid to certain war veterans.

140 Under the Law on Public Service, civil servants are entitled to employer-provided paid maternity leave at 100 per cent of their previous earnings for six months, as well as two years of job-
protected leave.
59
4.2 Legal coverage of the working-age population

Legal coverage of the working-age population is either provided on a universal basis (disability benefits)
or is limited to the formally employed population (cash sickness and maternity benefits). This means that
the majority of people working informally (or not working) have no income protection for these common
risks, placing a high burden on families and communities to absorb the impacts privately.

Persons with disabilities – and their households – have lower standards of living than non-disabled people
and are more likely to live in poverty (see Box 4.1).141 Systemic institutional, attitudinal and environmental
barriers impede disabled people’s ability to fully participate in economic and social activities, often
resulting in reduced access to education, employment and health care, as well as more limited
incorporation within social, economic and political networks.142 The extra costs that disabled people
face affect their ability to convert their capabilities into functioning, which affects their capacity to earn
adequate incomes. Failing to meet the needs of people with disabilities not only deprives them of their
right to social security but can also be a drag on the economy. For example, across 10 low- and middle-
income countries, it has been estimated that losses in productivity due to failing to effectively address
disability range from 1 per cent to 7 per cent of GDP.143 For these reasons, investing in social protection
for people with disabilities is vital to building inclusive and productive economies and societies.144
A disability can range from minor impairments that may add costs at the margin, to moderate and
severe disabilities that may mean significant additional costs to living. For example, households with a
disabled person may face more costly transport, health-care services, heating, laundry services, special
diets or personal assistance needs. Disability benefits may be designed (1) to replace lost income due to
an incapacity to work; or (2) to provide additional support to cover the extra cost of disabilities; or (3) a
combination of these two aims.
As with childhood disabilities, the Social Package in Georgia provides legal coverage through universal
benefits for all those assessed with a Group I, II or III disability. According to administrative data from the
SSA, 126,002 people received a disability benefit in 2018, although these figures include children. As with
child disability, it is fair to assume that the legally covered target population is indeed all persons with
disabilities, rather than just those who have gone through an official assessment. The system is therefore
designed based on the premise that all persons with disabilities, particularly mild or moderate ones,
will seek out an assessment. However, there are bound to be those who do not seek an assessment –
whether due to a lack of awareness of their right to a potential benefit, to a lack of resources to access
medical care, or to the fear of being stigmatized – and therefore are likely to be left without support.
Unfortunately, data limitations prevent us from estimating the actual size of the disabled population.145
142 Yeo and Moore (2003); Groce et al. (2011); and Trani and Loeb (2012).
143 Buckup (2009); and Banks and Polack (2014).
144 ILO and IDA (2019).
145 See also Section 2.4.2. There is no disability-specific national survey.

X Box 4.1: The link between disability and poverty

Disability and poverty are strongly associated: those who live in poverty are more likely to
become disabled, while those with a disability are much more likely to be living in poverty (see
Figure 4.2). Those living in poverty face a higher risk of poverty as a result of reduced access to
basic health care and increased vulnerability to malnutrition and preventable diseases. Those
in poverty are also more likely to live in dangerous or polluted environments with low-quality
housing and reduced access to safe drinking water and sanitation; and they are more likely to
inhabit areas that are prone to the effects of natural disasters, dangerous traffic and higher
rates of violence. Thus, disability and poverty mutually reinforce each other, contributing to
the increased vulnerability and exclusion experienced by disabled people around the world.
Figure 4.2: The disability and poverty cycle
Disability
Social and cultural Denial of

exclusion and opportunities for
stigma economic, social
and human
development
Vulnerability Reduced Poverty

to poverty participation in Economic,
decision-making,
and ill health and denial of civil
social and
cultural rights are
and political rights violated
Maternity benefits (state benefit for private sector

and employer liability for public sector)
Maternity protection is a vital tool for ensuring that women can reach their full potential, enabling
them to enter and remain in the labour market with confidence that their jobs will be protected during
periods of maternity. It is also fundamental to promoting child and maternal health and, when combined
with other measures (such as childcare and parental and paternity leave),146 helps combat workplace
discrimination. As the ILO explains, “the goal of maternity protection legislation is to enable women to
combine their productive and reproductive roles successfully and to promote equal opportunities and
treatment in employment and occupation.”147
146 Paid maternity and parental leave is only one part of a fully gender-responsive social policy system. See, for example, UN
Women (2019).
147 ILO (2016a).

Maternity protection (cash benefits) in Georgia is afforded only to women employed in the public and
private (formal) sectors. Data on employment in the informal economy (including agriculture) is limited.
While Geostat estimates that around 30 per cent (29.8 per cent) of the non-agricultural female labour
force is in informal employment, the proportion is likely much higher after including all employed women
aged 15 or older. According to analysis of the 2018 Labour Force Survey (LFS), around 423,000 women are
employed by either the State or private companies, as shown in Table 4.2. Of these women, approximately
256,000 were employed in the private sector148 and therefore entitled to the tax-financed state benefit
for private-sector employees; and approximately 167,000 were employed in the public sector, of which a
small proportion were civil servants and entitled to fully paid leave.149
X Table 4.2:
Number of women in the labour force, by employment status, 2018
Type of worker Number Share (%)
Total female employees 423,472 53

In the public sector 167,097 21
In the private sector 256,375 32
Female employers 9,861 1
Female own-account workers 168,656 21
Female contributing family workers 201,077 25
Total employed 803,065 100
Unemployed women 101,581
Total women in the labour force 904,646
Source: ILO, based on the 2018 LFS.
As shown in Table 4.2, the approximately 423,000 women account for around 53 per cent of the employed
population, but when we include unemployed workers, only around 46 per cent of the female labour
force is covered by maternity schemes. The rest, more than half the female labour force (54 per cent) –
including own-account workers, unpaid family workers, paid household workers (informal) and the
unemployed – are excluded. Furthermore, when looking just at the target population of women of
reproductive age, the covered population in this age group (around 250,400 employed women aged
15–49) accounts for less than a third of the total female population aged 15–49; this amounts to 28 per
cent if considering both the civil servants’ and state maternity schemes and 26.5 per cent if just the latter.
148 It is not possible to discern whether these private-sector workers were formally or informally employed. We assume here
that they are formally employed.
149 Only around 13 per cent of those employed in the public sector are civil servants. The 2019 Civil Service Bureau Activity
Report suggests that around 40,000 people were employed as civil servants in 2019 (Georgia, 2019), out of some 299,000
total public-sector employees in the same year (see Geostat LFS data: https://www.geostat.ge/en/modules/categories/38/
employment-and-unemployment).
This means that only a minority of working women can expect to receive any income support, much less
full replacement for lost wages, during the crucial period following childbirth; this has serious implications
for household income and health. Families increasingly rely on two earnings to make ends meet, and the
loss of one income can be catastrophic, particularly for those on the margins; this can potentially cause
steep losses in household consumption and even throw a significant portion of families into poverty.
Moreover, this income loss occurs precisely at the most critical time in a child’s development, when
changes to consumption can have serious impacts on a child’s cognitive development.150 In addition,
women who lack paid maternity leave also lack the basic job protections, including the guaranteed return
to the same job, that are afforded to those in formal employment. Therefore, informally working wage
earners not only face a loss of income due to maternity but also face the risk of losing their employment
altogether as employers can easily replace them during maternity leave, and non-wage earners (self-
employed) and wage earners alike will find it more difficult to return to work while caring for children.151
Finally, the pressure to return to work earlier than is recommended by health experts also has negative
implications for the health of women, who may not be physically ready to return to the workplace, and
children, who are less likely to be breastfed for the recommended six months.152
Cash sickness benefits and employment injury insurance

Like maternity benefits, paid sick leave is only provided to formally employed people in Georgia, which
represents around 64 per cent of the non-agricultural labour force (see Figure 4.1) and around 51 per
cent of the employed population, as shown in Table 4.3. However, when measured as a proportion of the
labour force, the share drops to 44 per cent.
X Table 4.3:
Number of workers in the labour force, by employment status, 2018
Type of worker Number Share (%)
Total female employees 860,161 51

In the public sector 299,827 18
In the private sector 560,334 33
Female employers 33,753 2
Female own-account workers 499,413 29
Female contributing family workers 299,974 18
Total employed 1,693,300 100
Unemployed women 245,730
Total women in the labour force 1,939,932
Source: ILO, based on the 2018 LFS.
150 Britto (2017).
151 ILO (2016b). See also UN Women (2020b).
152 See WHO: https://www.who.int/health-topics/breastfeeding#tab=tab_1.

The new employment injury insurance scheme ostensibly covers all those employed in hazardous
professions. Sectors required to register as hazardous are listed in Annex 3, but it is not yet possible to
assign a number to the population expected to be legally covered under the new law.153
Table 4.4 summarizes the target population and extent of the legal coverage of working-age people,
based on the three main lifecycle benefits in operation.
X Table 4.4:
Percentage of working-age people legally covered by lifecycle schemes in Georgia
Coverage Disability benefit Cash sickness Maternity benefit Employment

(Social Package) benefits (private + public injury (not yet
sectors) implemented)
Target group Persons of working All formally All formally All persons
age with disabilities employed employed women employed in
(assessed with persons hazardous
Group I, II or professions (as
III disability) defined by law)
Share of all Actual share of 51% of 53% of female Unknown
children persons of working employed employed population (regulations
age with disabilities population in progress)
unknown (including
agriculture) 46% of the female
labour force
Global estimates
range from 15% 44% of the
to 19% (including labour force 28% of the total
older people) female population
of reproductive age
4.3 Effective coverage of the working-age population

Overall, around 14.5 per cent of people of working age in Georgia were receiving some social protection
benefit in 2018 (see Figure 2.5).154 The rest of this chapter assesses the extent to which the existing
programmes actually reach the populations they are intended to reach, keeping in mind that at least
three contingencies (unemployment, survivorship and employment injury) are either not covered under
any scheme or have not yet been implemented.
153 However, as of May 2020, some 3,105 enterprises have been registered as hazardous. See also Annex 3.


Georgia’s universal disability benefit scheme, provided under the Social Package, is frequently overlooked
in national and international understandings of Georgia’s social protection system. This is despite the
fundamental importance of providing income security to persons with disabilities so they can be fully
included in society and the economy. How effective the disability benefit system is at reaching people
of working age with disabilities and meeting their needs will depend on the State’s ability to identify and
assess people with disabilities,155 as well as the administrative capacity to deliver adequate benefits.
Even with an efficient and effective state capacity, it is highly unlikely that the disability assessment
process has identified all persons of working age with disabilities. However, as with disability benefits
for children, data constraints prevent us from estimating the actual number of people with disabilities.
According to the 2018 IHS, among children and people of working age, the vast majority of those
assessed as disabled are receiving benefits. Figure 4.3 shows the percentage of the registered disabled
population (by age group) who are receiving either a disability pension under the Social Package or the
old-age pension. The sudden drop in those receiving disability benefits after the age of 60 reflects the
fact that the Social Package converts to an old-age pension at retirement, so many old-age pensioners
who are registered disabled are not in fact receiving a disability benefit.156 As a result, around 95 per cent
of disability pensioners in Georgia are of working age, according to the 2018 IHS.
X Figure 4.3:
Percentage of people registered as disabled receiving a disability benefit under

the Social Package or the old-age pension, by age, 2018
100%
Percentage of the population
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
4
+
0-
5-
-1
-1
-2
-2
-3
-3
-4
-4
-5
-5
-6
-6
-7
-7
80
10
15
20
25
30
35
40
45
50
55
60
65
70
75
Disability pension (Social Package) Universal old-age pension
155 The disability assessment process in Georgia has historically been based purely on a medical assessment, though the
Government is working with partners, including UNICEF, to shift towards a “social model of disability”, one which considers
each child’s individual functional needs and abilities to enable their full participation in society and the economy. See
UNICEF (2018a).
156 The conversion from a disability pension to an old-age pension is not uncommon in social security systems around the
world. In some cases, pensioners are entitled to keep the disability pension if it is higher than the old-age pension.
While coverage of disability benefits among those who have been assessed as disabled is generally very
high, certain gaps remain. For example, those assessed with the mildest degree of disability (Group III)
tend to be least likely to receive the benefit. As shown in Figure 4.4, essentially all working-age adults
with Group I status (99.7 per cent) and almost all working-age adults with Group II status (97.6 per cent)
receive a disability pension, but only 76 per cent of those assessed as moderately disabled (Group III) do.
This could be due to both a lower benefit value for Group III disabilities (GEL 100 per month) as well as
a lower likelihood of submitting an application among those whose incapacities still allow them to earn
at least a partial income.
X Figure 4.4:
Percentage of population assessed as disabled receiving a disability pension (Social

Package), by disability status, 2018
100%
80%
99,7% 97,6%
60%
76,2%
40%
20%
0%
Group I Group II Group III
Assessed degree of disability
There are also certain rules surrounding eligibility that could explain the small gaps in coverage among
persons assessed as disabled. For example, people with Group II disabilities are not allowed to work in
the public sector and continue to receive the benefit (private-sector activity is still permitted) unless they
are blind, and persons with a Group III disability are also prohibited from public-sector employment and
must have been assessed as disabled since childhood to be able to claim the disability in adulthood.157
The 2018 IHS also reveals gender differences in disability claims. Whereas globally women tend to have
higher disability prevalence rates, in Georgia, approximately 60 per cent of disability pensioners are
men, compared with only 40 per cent of women, as shown in Figure 4.5. While some of this variation
is explained by the fact that there are more women receiving the old-age pension, which begins at age
60 (compared to age 65 for men), there may also be social and administrative factors at play, as well as
labour market segregation and men’s associated higher exposure to risk.
157 See SSA website: http://ssa.gov.ge/index.php?lang_id=GEO&sec_id=1388.

X Figure 4.5:
Percentage distribution of disability benefit recipients under the Social Package,

by sex, 2018
Male 59,4%
Female 40,6%
0% 10% 20% 30% 40% 50% 60% 70%
Percentage
In addition, the following patterns can be observed with regard to disability benefits:
X The likelihood of receiving the Social Package benefit is slightly higher for people at lower ends of
the income/consumption distribution, with 4.7 per cent of those in the bottom consumption decile
receiving the benefit, compared with just 1.8 per cent of those in the top decile.158 This pattern is
consistent with the generally higher expected prevalence of disability among lower-income groups.159
X The likelihood of receiving a disability benefit is higher for those living in rural areas (3.6 per cent) than
in urban areas (2.6 per cent),160 likely reflecting differential patterns of exposure to risk.
X Those belonging to certain ethnic groups have a higher-than-average likelihood of receiving disability
benefits, potentially reflecting higher degrees of vulnerability and/or lower levels of access among
certain groups. For example, 4.6 per cent of ethnic Ossetians and 4.2 per cent of ethnic Armenians
receive benefits, compared with the national average of 3 per cent. There are also markedly lower-
than-average levels of disability benefit receipt among, for example, ethnic Abkhazians (0 per cent),
ethnic Greeks (0.7 per cent) and ethnic Ukrainians (0 per cent).161
X According to administrative data, the number of disability pensioners has been steadily rising, from
122,055 in 2012 to 126,002 in 2019.
Maternity benefits (state benefit for private sector

and employer liability for public sector)
The 2018 IHS does not allow us to identify whether or not someone has received a maternity benefit. In
addition, we were unable to obtain data on the number or level of benefits paid by public-sector entities,
as each entity pays its own benefits directly to the employee and no unified database on public-sector
benefits exists. Based on administrative data from the SSA, in 2019, only 13,609 women claimed the
state-funded maternity benefit for women working in the private sector. The number of cases has risen
since 2011, when it amounted to just over 8,500, as shown in Figure 4.6.
158 Based on the 2018 IHS.
160 Based on the 2018 IHS.
161 Ibid.
X Figure 4.6:
Total number of private-sector maternity benefits paid by the SSA, 2011–2019
16 000
Total number of cases
14 000
12 000
10 000
8 000
6 000
4 000
2 000
-
2011 2012 2013 2014 2015 2016 2017 2018 2019
While data constraints prevent us from determining exactly how many women are formally employed
in the private sector, our analysis suggests that around 237,915 women aged 15–49 would be legally
covered by the state maternity benefit.162 This represents around 26.5 per cent of all women aged 15–49.
Based on analysis of UN population data, around 54,000 women gave birth in Georgia in 2018;163 and by
using the general population figures to extrapolate the number of births among the covered population,
the data suggest that the number of the women who would have been entitled to the benefit in 2018 –
around 14,300 – was only slightly higher than the approximately 13,600 women who actually took the
benefit that year. Therefore, take-up of the benefit appears to be quite high (around 95 per cent), which
is largely consistent with the findings on effective coverage rates for other benefits administered by the
SSA.
Although take-up appears to be high, there are several potential explanations for the incomplete take-up
of state maternity benefits. Some women may not be aware of their rights, as explained in Section 2.4.2.
In addition, some employees may be receiving more generous maternity benefits from their employers
(e.g. anecdotally, we learned that some employers provide 100 per cent of wages for a number of months)
and may therefore choose not to access the state benefit. However, there was no data available on
employer-provided paid maternity leave. Finally, the gap in take-up could be related to the relatively low
value of the benefit, which may not be appreciated among higher earners (see Section 4.3.2).
Paid sick leave (cash sickness benefits)

Because cash sickness benefits are administered by individual employers, with little oversight from the
Ministry of IDPs, there is no administrative data available on take-up rates. In fact, a lack of data on
sick pay take-up rates is not unique to Georgia but is a common challenge around the world, especially
under employer-liability frameworks. The 2018 IHS appears to have a question about paid sick leave, but
it revealed no beneficiaries. It is unlikely that no one is given paid sick leave; rather, there appears to be
no effort to collect data on what employers are actually doing in practice, making it difficult to enforce
the regulation.
162 This estimate is based on the following data and assumptions: The 2018 LFS suggests that there were 250,437 female
employees. The state maternity benefit scheme excludes civil servants, who account for approximately 13 per cent of those
employed in the public sector, or 5 per cent of all employed women. Therefore, those who would be covered account for
95 per cent of employees, or 237,915 workers.
163 According to UN World Population Prospects estimates, 53,918 women in Georgia gave birth in 2018.

Providing adequate benefit levels for persons with disabilities is vital for ensuring a minimum standard
of welfare for recipients, enabling them to prosper and contribute to society. ILO Conventions Nos. 102
and 128 establish a minimum standard replacement rate of 45 per cent164 or 50 per cent,165 respectively,
of the prevailing wage for an unskilled manual worker, for schemes that provide tax-financed benefits
for persons with permanent disabilities who have no capacity for gainful employment.166 By comparison,
the replacement-rate benefits for the non-disabled are 5 percentage points lower, reflecting an implicit
recognition in the Conventions of the additional costs associated with being disabled. However, it should
be noted that global evidence suggests that the additional costs of being disabled are significantly higher
than 5 per cent and typically range from 10 per cent to 40 per cent.167 Therefore, the standards in the
Conventions are likely to be underestimated.
Table 4.5 compares the current value of the Social Package disability benefit for a severe (Group I)
disability with the minimally adequate values derived from Conventions Nos. 102 and 128. The current
value of GEL 220 per month is low compared with the values that would be considered minimally
acceptable according to the Conventions: it is only 84 per cent of the minimum established by Convention
No. 102 and only 76 per cent of the level established by Convention No. 128.
X Table 4.5:
Minimum adequate disability benefit levels in Georgia according to C102 and C128
National Value of Average monthly C102 adequate C128 adequate

benefit national nominal wage disability disability
benefit of elementary pension of 45% pension of 50%
occupations (2017)168 (per month) (per month)
Social Package GEL 220 GEL 581.20 GEL 262 GEL 291
disability benefit
(Group I)
164 ILO (1952).
165 ILO (1967).
166 Over time, there has been growing recognition of the need to support persons with disabilities who have the capacity
to work to remain in the labour market. The Conventions do not provide for scaled benefits for reduced degrees of
disabilities, but many countries around the world, including Georgia, provide different replacement rates for different
degrees of disabilities. In this analysis, we account for different degrees of disability (or working capacity) through the
variation in the additional costs of disability, according to the degree of disability.
167 Empirical evidence suggests the extra costs associated with being disabled can range from 10 per cent to 30 per cent. For
example, see UN DESA (2018) and James and McClanahan (2019).
In addition, Conventions Nos. 102 and 128 set even higher minimum standards for contributory benefits,
where replacement rates are calculated in respect of the employee’s previous earnings. When using
the average wage for all employees in Georgia (GEL 1,068 in 2018), a typical worker earning the average
wage should expect to receive, at a minimum, GEL 481 (45 per cent of the average wage, according to
Convention No. 102) and GEL 534 (50 per cent, according to Convention No. 128). The current pension
of GEL 220 per month is well below half these values (46 per cent and 41 per cent, respectively, of the
expected minimum).
Figure 4.7 presents a comparison of transfer values as a percentage of GDP per capita in a selection of
countries that provide tax-financed disability benefits (or “disability social pensions”). However, it should
be noted that the nature and purpose of the benefits varies widely – for example, income replacement
versus extra cost compensation – from country to country and that the values are not always strictly
comparable. Nevertheless, Georgia’s disability pension, valued at 20 per cent of GDP per capita for a
Group I (severe) benefit, performs quite well comparatively speaking, but the Group II (at around 13 per
cent of GDP per capita) and Group III (at around 9 per cent of GDP per capita) levels perform less well than
most of the European examples (which in some cases represent the lower value of a range of values).
Maternity benefits (state benefit for private sector and non-civil servants
in the public sector, and employer liability for civil servants)
As a general rule, lump-sum benefits – like Georgia’s state maternity benefit for private-sector workers
and public-sector workers not employed as civil servants – are not considered social security by most
definitions since they fail to provide regular, predictable income security over the duration of the risk.169
Although take-up rates for the state maternity benefit appear to be higher than expected, there is a
small gap that could be explained by a number of factors, including the very low value of the benefit for
the vast majority of working women in the private sector. A maximum flat rate benefit of GEL 1,000 – if it
were paid monthly for six months – would amount to approximately GEL 167 per month. Given that the
average monthly wage for women in 2018 was GEL 822.60, this would amount to a monthly benefit of
around 20 per cent of the average employed woman’s previous wage.170
According to the ILO Maternity Protection Convention, 2000 (No. 183), the minimum standard for the
value of a maternity benefit should be two thirds of the woman’s previous salary for at least 14 weeks.171
While Georgia’s benefit technically goes beyond 14 weeks, if the GEL 1,000 were paid in even instalments
over 14 weeks, it would amount to a weekly payment of GEL 71.40, or roughly GEL 285 per month. This
would amount to only 35 per cent of the average woman’s wages in Georgia, still well below the two-
thirds minimum established by Convention No. 183.
The Convention’s accompanying Recommendation (No. 191) goes beyond the minimum standards
outlined in the Convention, suggesting that the minimum period of paid leave should be 18 weeks and
that, “wherever practicable”, women should be paid their full salary for the entire period of leave.172 Again,
technically, Georgia’s period of paid leave (six months or 183 days) exceeds the recommendation, but
as the benefit is so low, it would still just be a small fraction of the recommended full salary. Needless to
say, women who earn above the average salary are doing significantly worse relative to the Convention
and Recommendation.
Table 4.6 summarizes the adequacy of the state maternity benefit and the benefits for civil servants
relative to the monthly values that would be required under Convention No. 183 and Recommendation
No. 191, using the Geostat average wage for women recorded in 2018 of GEL 822.60 per month. In
terms of duration, Georgia’s benefits exceed the minimum duration under both the Convention and the
Recommendation. However, the cap on the maximum value of the state maternity benefit means that
the effective monthly value for the vast majority of formally employed women is inadequate.
169 See also Section 5.3.2 for a discussion on the adequacy of benefits under the new accumulation pension scheme.
170 While there are certainly some women who earn below this level and would receive their full salary, they are likely
underpaid for the work they are carrying out and are not protected by an adequate minimum wage.
171 ILO (2000a).
172 ILO (2000b).

X Figure 4.7:
Comparison of tax-financed disability benefit values around the world, latest year
available (percentage of GDP per capita)
Denmark
Uzbekistan
Brazil
Nepal
Uruguay
France
Maldives
South Africa
Albania
Argentina
Finland
Sweden
Georgia (Group I) 20,00%
Ukraine
Armenia
Dominican Republic
Portugal
Kenya
Seychelles
Namibia
Mauritius
Chile
United Kingdom
Georga (Group II) 12,78%
Azerbaijan
Indonesia
Malaysia
Sri Lanka
Moldova
Georia (Group III) 9,13%
Viet Nam
Ecuador
Russian Federation
Costa Rica
Republic of Korea
Brunei
Timor-Leste
Bangladesh
Singapore
Spain
India
China
0% 10% 20% 30% 40% 50% 60% 70%

X Table 4.6:
Adequacy of maternity benefits in Georgia relative to ILO standards (based on

monthly reference earnings of GEL 822.60 )173
Dimension National benefit International standard

of
Civil State maternity benefit C183 R191
adequacy
servants’ for private sector
maternity and public sector not
benefit employed in civil service
Value 100% of 100% of earnings up to a Two thirds (67%) Full (100%)
earnings total benefit of GEL 1,000 of earnings earnings
(GEL 822.60) (maximum of GEL (GEL 551.14/month) (GEL 822.60/
167/month) month)
Duration 183 days 183 days 14 weeks 18 weeks

(6 months) (6 months) (3.23 months) (4.15 months)
X Box 4.2: Overview of maternity, paternity and parental leave protections around the world
Based on a systematic review of maternity legislation in 170 countries conducted in 2013, the
ILO (2016a) found that:
X 98 countries provide at least 14 weeks of leave
X 74 countries pay at least two thirds of earnings
X More than 100 countries financed benefits through social security (contributory
or non-contributory)
X 7 countries require employers to cover the costs directly
Many countries also offer paternity leave. According to the review:

X 79 countries provide paternity leave, in 71 of which it is paid leave
X Generally, paternity leave is paid at 100 per cent of the worker’s previous earnings, with
some exceptions
X In 46 countries, the employer pays the benefit
X In 28 countries, the benefit is paid through social security
The review of parental leave policies found that:

X 66 countries provide some form of parental leave, of which 36 provide cash benefits
X Benefits range from 20 per cent of the minimum wage (Uzbekistan) to two thirds of earnings
(18 countries)
X Benefits are typically financed through the social security system, primarily social insurance
X Take-up rates are low among men unless the period of leave is non-transferable (i.e. must
be used by the man)
173 Average monthly nominal wage for women in 2018 (source: Geostat).
Nearly all countries around the world provide some form of maternity protection legislation. The nature
(pay, duration, financing) varies significantly, with more than half of them exceeding the minimum
duration required under Convention No. 183, and just under half pay at least two thirds of earnings
(see Box 4.2).174 In a subsequent review, out of 45 countries in Asia, only six do not provide 100 per
cent of previous earnings, through a relatively even mix of employer-liability and social insurance. In
Europe, there is more variability in replacement rates, with some countries providing as low as 65 per
cent (Slovakia) or 67 per cent (Turkey) of earnings, just over a third (17 countries) providing anywhere
between 70 per cent and 90 per cent, and the rest paying 100 per cent. All countries in Europe exceed
at least the Convention’s required duration of 14 weeks, while almost two thirds exceed the 18 weeks
suggested in Recommendation No. 191. 175
Many countries also provide paternity and/or parental leave (see Box 4.2), both of which are important
elements of a gender-responsive social protection system. Paternity leave is reserved for the father
and tends to be offered for relatively short periods following childbirth, and take-up rates can be low if
the leave is not mandatory. Parental leave, on the other hand, is often provided for an extended period
following maternity leave and may be shared between either parent or may be non-transferable, where
a certain amount of leave is reserved for each parent as an individual entitlement.176 Shared leave, and
especially equal, non-transferable leave for both parents, is among the most powerful ways to promote
gender equality in the household and to combat gender-based discrimination in the workplace.177 Georgia
currently provides neither of these types of benefits,178 meaning that the responsibility of caring for
children in the early months and years of their lives falls entirely to mothers, which can impact negatively
on their labour market participation, chances of career progression and lifetime earnings.
Paid sick leave

According to employer liability, paid sick leave in Georgia is provided at full salary for up to 30 days,
which can be extended under certain circumstances with special authorization from a certified medical
commission. ILO Convention No. 102 and subsequently the Medical Care and Sickness Benefits
Convention, 1969 (No. 130), offer a set of standards to compare the adequacy of paid sick leave in
Georgia, summarized in Table 4.7.
X Table 4.7:
Adequacy of cash sickness benefits in Georgia relative to ILO standards
Dimension National benefit C183 R191

of adequacy
Value 100% of earnings 45% of earnings 60% of earnings
Duration 30 days, extension possible Up to 26 weeks Up to 52 weeks

(up to 10 months maximum per incident per incident
under certain circumstances)
174 ILO (2016a).
175 For detailed information on maternity protection legislation around the world, see ILO (2017, table 5.B). See also ILO
(2016a).
176 Ibid.
177 Nordic Council of Ministers (2019).
178 However, unpaid childcare leave following the end of the maternity leave period is provided for women for up to 12 total
weeks until the child turns 5 years old.
In terms of the replacement rate, the regulations in Georgia are in fact more generous than the minimum
standards in Conventions Nos. 102 and 130. With regard to duration, Georgia’s legislation appears to
meet the minimum standards for benefit duration set out under Convention No. 102 but falls just short
of the 52 weeks called for under Convention No. 130.
However, there is an apparent contradiction between the regulations around paid sick leave and labour
laws, which appear to set limits on the ability of employees to take extended medical leave. Article 37(1)
(i) of the Labour Code of Georgia states that employers may use extended medical leave as grounds for
lawful termination of a labour agreement: “long-term disability, unless otherwise provided for by a labour
agreement, if a disability period exceeds 40 consecutive calendar days or total disability period exceeds
60 calendar days within six months, and, at the same time, the employee has already used his/her leave
of absence under Article 21 of this Law”.179 It is unclear how this is resolved in practice (or whether it has
been tested in the courts), but the article could deter people from taking legitimate medical leave, even
when such leave is certified by the competent authorities.
4.4 Summary
Working-age people in Georgia lack access to key social protection provisions that would better enable
them to weather common lifecycle shocks, notably including unemployment, survivors’ benefits and, for
now, insurance against work-related accidents or diseases. In addition, legal gaps in coverage prevent
many people from being covered even where the system ostensibly provides benefits. However, the
headline statistic that only around 14.5 per cent of the adult population was receiving a benefit in 2018
masks more complex coverage dynamics among the working-age population.
For disability, the overall story is one of relative success. A universal benefit ensures that the vast majority
of people who live with a disability are able to access benefits from the State to improve their quality of
life. The link between the disability assessment process and the payment of benefits appears to be tight,
with bigger gaps for those with less severe disabilities: between three quarters per cent (Group I) and
almost all of the registered disabled population (97.6 per cent for Group II and 99.7 per cent for Group
III) were receiving a benefit according to the 2018 IHS. Approximately 95 per cent of those receiving
the Social Package disability benefit are of working age; this is because the disability pension converts
to an old-age pension at retirement, a transition that the data would suggest is well administered. A
more serious challenge to the system is the lack of accurate estimates of the true size of the disabled
population, as there are bound to be people who fail to obtain an assessment for any number of reasons.
In terms of adequacy, disability benefits also appear to be lower than the levels that would be suggested
under the relevant ILO Conventions, accepting the caveats associated with using the reference wage for
elementary occupations; however, the benefits compare relatively well with international levels, again
with caveats.
For sickness and maternity benefits, data limitations make it challenging to precisely determine the
size of the legally covered population, but our estimates suggest that around half the labour force
lacks protection for either of these risks, which is by far the biggest challenge. Among those who are
legally covered, administrative data for maternity benefits suggest that take-up is quite high. There is
no comparable data on sickness benefits, making it impossible to assess effective coverage, but there
are bound to be a significant number of people who are not receiving sick pay despite having the right.
Regarding the adequacy of these benefits, the state maternity benefit covering formally employed private-
sector workers and the majority of public-sector workers is inadequate due to its lump-sum nature and
low value relative to women’s average wages. Because of the cap on the total amount, the benefit only
replaces a fraction of women’s lost earnings, far lower than the two thirds required of Convention No. 183.
In terms of duration, however, in theory the state benefit compares well (at 183 days) to the Convention,
but again, as a lump-sum benefit this duration becomes almost irrelevant for most people who access
the benefit. There are also no paid paternity leave provisions. On the other hand, sickness benefits
compare relatively well to the minimum standards in the relevant conventions, but there are concerns
related to potential inconsistencies with the Labour that risk having a chilling effect on legitimate claims.
Table 4.8 summarizes the legal and effective coverage of the working-age population in Georgia. The
following chapter turns to social protection provision for older people in Georgia.
179 Georgia (2013).

X Table 4.8:
Summary of legal and effective coverage of the working-age population in Georgia
Dimension of coverage Disability benefit Maternity benefits (state Paid sick leave (cash Employment injury
(Social Package) benefit for private sector sickness benefits) insurance
and non-civil servants in the
public sector, and employer
liability for public sector)
Target group Persons of working age All formally employed women All formally All persons employed in
with disabilities (assessed employed persons hazardous professions (as
with Group I, II or defined by law)
III disability)
Share Actual share of persons 53% of female employed 51% of employed population Unknown (regulations
of working-age of working age with population (including agriculture) in progress)
Legal population disabilities unknown
coverage
46% of the female 44% of the labour force
Global estimates labour force
range from 15% to 19%
X 5. Social protection for older people in Georgia

(including older people)
28% of the female population
of reproductive age
Horizontal 80%–100% of adult Approximately 95% of Unknown (no administrative N/A
(extent registered disabled those entitled to the state data available on
of population) population, depending on maternity benefit are take-up rates)
the degree of disability claiming benefits
Effective Actual share of
coverage working age with
disabilities unknown
Vertical Medium Low Medium to high N/A
(adequacy/level
of benefit)
75
The Government of Georgia has invested heavily in ensuring that older people receive basic social
protection through the universal old-age pension and access to health care. The social pension, as one of
the flagship social protection programmes, is paid in recognition of a lifetime of contributions to society
and the economy. However, social pensions are also justified on social, political and economic grounds,
with benefits accruing more broadly to pensioners’ families, communities and the economy at large.180
But for many people, social pensions are insufficient to maintain a standard of living comparable to what
they enjoyed during their working lives and ideally should be complemented with other instruments in
a multi-tiered framework.
5.1 Context and overview of benefits for older people
5.1.1 Low poverty but many still at risk

As people age, their ability to work or contribute to household income declines. Nearly 40 per cent of
Georgians aged 60–64 have either exited the labour market or are unemployed, with participation rates
falling even more for older age groups.181 As their income declines and their health needs increase, it is
vital that older people have access to income and medical care. In Georgia, both of these basic elements
are already in place. Everyone aged 65 and above has access to health insurance,182 and Georgia’s
universal social pension provides basic income security – a “floor” of social protection – to all older people
as they age, helping ensure that they do not fall into poverty.
Indeed, thanks largely to the impacts of the universal old-age pension, poverty is lowest among older
people compared with other age groups in Georgia, as shown in Figure 5.1. The percentage of people
living below both the absolute (below 40 per cent of median consumption) and the relative (below 60
per cent of median consumption) poverty lines declines significantly as soon as people become eligible
for the old-age pension, at age 60 for women and age 65 for men. Nevertheless, 5 per cent of older
people are still considered poor, and some 15 per cent of older people are still vulnerable, or “at risk of
poverty”,183 based on the relative poverty line.
180 For example, older people tend to use their pensions to support children and young people, reflecting an investment
in the future labour force. Pensioners also use their income to generate new economic activities; their extra spending
from pensions can stimulate demand and consumption; and pensions can encourage both public and private
savings and investment. See, for example, Kidd and Tran (2017).
181 Geostat. Authors’ own calculations based on national population and labour force statistics; data are for
2018.
183 Georgia’s relative poverty line roughly corresponds to the methodology used in the European Union to identify those
who fall under the “at-risk-of-poverty” threshold of 60 per cent of the median equivalized disposable income (after social
transfers). See https://ec.europa.eu/eurostat/web/products-datasets/product?code=tessi014.
X 5. Social protection for older people in Georgia 77
X Figure 5.1:
Percentage of the population living in relative poverty (below 40 per cent and
60 per cent of median equivalized household consumption), by age and sex, 2018
35%
30%
25%
20%
15%
10%
5%
0%
4
+
0-
5-
-1
-1
-2
-2
-3
-3
-4
-4
-5
-5
-6
-6
-7
-7
80
10
15
20
25
30
35
40
45
50
55
60
65
70
75
Females below 40% median cons. Males below 40% median cons.
Females below 60% median cons. Males below 60% median cons.
Figure 5.1 also shows that poverty and vulnerability vary by sex as well, in different ways at different
stages of the lifecycle. Whereas girl children are slightly more likely to be poor than boys, this trend
first reverses during late working age before essentially evening out for those living below 40 per cent
of median consumption, while older men (aged 70+) are slightly more likely to live below 60 per cent
of median consumption. Because women live longer than men on average, however, women make up
around 86 per cent of the widowed population; men, 14 per cent. Because there is no survivors’ pension
paid when a pensioner dies, this loss of income can represent a dramatic decrease in household income
for the surviving spouse (for example, a 50 per cent decline if both derived their sole source of income
from the pension), while costs of maintaining the household often remain high.
Like many countries in the region and around the world, Georgia is an ageing society. In 2019, more than
a quarter of Georgia’s population was older than the age of 60. According to population projections,
the old-age dependency ratio (measured as the share of the population aged 65 or older relative to
those aged 15–64), which is estimated to be around 0.24 in 2020, will rise to 0.36 in 2050 and 0.5 in
2090. Therefore, over time, there will be fewer and fewer people of working age to support their elders,
underscoring the need for a concerted and continued investment in building a comprehensive pension
system that can provide for adequate income security in old age.
As discussed in Section 2.2, while a universal basic pension can provide a basic floor of protection, it is
rarely sufficient to allow people to retain a standard of living comparable to when they were earning an
income; rather, other tools (usually social insurance) are often needed to adequately finance higher-level
benefits. Older people in Georgia lack access to this additional support.
5.1.2 Key social protection schemes aimed at older people

In Georgia, all women and men can expect to receive a regular, predictable monthly pension when they
reach either age 60 (women) or age 65 (men), and the evidence shows that nearly all of them – around
97 per cent as of 2018 – are currently being reached. This remarkable achievement demonstrates the
commitment by the Government of Georgia to providing a truly universal pension. The benefit is fully
financed from the state budget and, as was shown in Figure 2.11, accounts for around 70 per cent of
government social protection outlays. The monthly pension was recently raised to GEL 220 per month,
which is around 20 per cent of GDP per capita. It is administered by the SSA.
In addition, the Law of Georgia on Accumulated Pensions, passed in 2018, introduces a new contributory
element to the social security system, with contributions set at relatively low levels,184 as follows:
X Employees: 2 per cent of pre-tax earnings
X Employers: 2 per cent of payroll
X Self-employed: 4 per cent of declared earnings
X Government: 1 per cent of the employee’s earnings if the employee’s monthly earnings are more than
GEL 2,000 before tax deductions, or 2 per cent if the monthly earnings are lower than GEL 2,000
The system is a defined contribution model based on individual accounts that are managed by pension
management companies, which are licensed and supervised by the National Bank of Georgia. The newly
created State Pension Agency collects contributions and, eventually, will pay benefits.
Therefore, the main income transfers for older people in Georgia include:
X Universal old-age pension
X New accumulated pension (mandatory individual account)
A key gap in coverage that particularly affects older women is the complete absence of survivors’
pensions for adults.
The following sections assess the coverage in legal and effective terms, including exploring whether the
benefits currently provided (or likely to be provided, in the case of the new contributory pension) are
adequate.
5.2 Legal coverage

Georgia’s Law on State Pensions, which governs the universal old-age pension, covers all citizens,
permanent residents with at least 10 years of residency, and stateless persons. The only criterion for
claiming the pension is age: women qualify at 60 years of age, and men at 65. Virtually everyone above
pensionable age is legally covered. Technically, the pension is designed to be “pension-tested” since
those who are receiving State Compensation benefits (special pensions for certain veterans and civil
servants) cannot also receive the universal pension, but this only applies to around 0.7 per cent of the
older population.
184 These contribution rates are relatively low by international standards. In Europe, rates are much higher for mandatory
public pensions. See ISSA/SSA (multiple years).
X Table 5.1:
Lifecycle social security schemes for older people in Georgia
Statutory features of main schemes for working-age adults

Scheme Type Regulatory Legally covered Financing Qualifying Description Administrative
of scheme framework population arrangement conditions of benefits responsibility
Universal Universal Constitution Citizens of Georgia State budget Aged 65 (men) GEL 220 per SSA
old-age (non-means- of Georgia or 60 (women) month
Stateless persons
pension (State tested, (1995)
in Georgia Cannot
Pension) non-
Law of also benefit
contributory) Foreign nationals
Georgia from State
residing permanently
on State Compensation
(legally) in Georgia for
Pensions or the
a minimum of 10 years
(2005) Academic
Foreign nationals who Scholarship
have been granted
citizenship (dual)185
Accumulated Mandatory Law of Citizens of Georgia Contributions financed: Aged 65 (men) Reflects the State Pension
pension individual Georgia on or 60 (women) contributions Agency
Stateless persons X Employee: 2% of
(supplementary account Accumulated to receive made by the
and foreign monthly earnings The National
pension) (defined Pensions the pension employee,
nationals residing X Employer: 2% of Bank (regulates
contribution) (2018) employer
permanently (legally) monthly payroll investment
and the State
in Georgia (excludes X State: 2% of activity of the
party plus
non-residents as employee’s monthly State Pension
interest
defined by the Tax earnings if lower Agency)
Code of Georgia) than GEL 2,000 or Can be
1% if greater than accessed
Mandatory for legally
GEL 2,000 before by means
employed persons
tax deductions of a lump
under the age of 40
X Self-employed sum, by a
Voluntary for person: 4% of programmed
those aged 40 or declared earnings withdrawal or
above and for self- and 1% or 2% by purchasing

employed persons by the State an annuity.
79
185 Must only receive one pension.

The accumulated pension is currently only mandatory for all formally employed persons, while
participation is voluntary for those registered as self-employed and for employees who were aged 40
and above when the system was introduced in September 2018 (based on automatic enrolment with the
possibility of opt-out).
Unlike the vast majority of countries around the world, Georgia lacks any legal framework for paying
benefits to a surviving spouse when a pensioner dies. This gap particularly impacts women, who tend
to live longer than men.
The key statutory features of both programmes are shown in Table 5.1.
In Georgia, the size of the legally covered population for the universal pension is, for all practical
purposes, 100 per cent of people above pensionable age. For the new accumulated pension scheme, the
size of the covered population reflects the intended covered population as the scheme matures to fully
include workers of all ages on a compulsory basis. If the system were to mandatorily cover all public- and
private-sector employees today, it would cover around 44 per cent of the labour force (see Table 4.3). The
estimated size of the legally covered population is summarized in Table 5.2
X Table 5.2:
Percentage of older people legally covered by lifecycle social security in Georgia
Coverage Universal old-age New accumulated pension

pension (State (mandatory individual account)
Pension)
Target group All women over Beneficiary population (future): All
age 60; all men women over age 60; all men over age 65
over age 65
Contributory population:
X Current: All public- and private-
sector employees who were
younger than age 40 in 2018
X Future: All public- and private-
sector employees
Beneficiary coverage 100% Unknown
ratio: share of population
over age 60 or 65
Contributor coverage ratio: N/A 44%
share of labour force
5.3 Effective coverage

Overall, nearly every older person in Georgia is receiving an old-age pension. While the extent to which
the universal pension reaches its intended population is clear, it is less clear what will happen with the
new mandatory supplementary pensions. The following section examines the coverage of old-age
pensions in terms of the nature and extent of coverage, as well as the adequacy (or predicted adequacy)
of the existing and future benefits.
Universal old-age pension

The universal old-age pension in Georgia is a policy success story. Around 97.4 per cent of older persons
(including 98.1 per cent of older women and 95.9 per cent of older men) who are eligible for the benefit
are receiving it, according to analysis of the 2018 IHS. Because coverage is so high, there is very little
variation in the coverage distribution: for all practical purposes, older men and older women, those
in urban and rural areas, those living in different regions of the country and those of all income levels
(see Figure 5.2) are highly likely to receive the pension, attesting to its truly universal nature. Small gaps
in coverage are generally explained by the small proportion of older people who are receiving State
Compensation benefits, who are more likely to be men (for example, 1.8 per cent of older men receive a
special pension for veterans or other groups, compared with just 0.2 per cent of older women).
X Figure 5.2:
Percentage of the population over age 60 (women) or age 65 (men) receiving the
universal old-age pension, 2018
100,0% 98,0% 98,1% 98,7% 97,6% 96,7% 98,8% 98,4% 97,2% 96,9%
95,0%
90,0%
Percentage of the older
80,0%
population
70,0%
60,0%
50,0%
40,0%

There are nevertheless a number of gaps, including observable variation by ethnicity and marital status,
where coverage is below average primarily due to administrative barriers to coverage. For example,
whereas 97 per cent of all older people receive the universal pension, this drops to 89.9 per cent among
ethnic Ossetians, according to the 2018 IHS, as shown in Figure 5.3. The reasons for this gap are unclear,
but it could be due to migration and the complex issues related to citizenship. In addition, single and
divorced persons are slightly less likely to receive the pension, at 94 per cent and 91 per cent, respectively
(see also Section 5.3.2).186
X Figure 5.3:
Percentage of the population over age 60 (women) or age 65 (men) receiving the
universal old-age pension, by ethnic background, 2018
Ukrainian 100,0%
Greek 100,0%
Abkhazian 100,0%
Russian 99,6%
Other 99,1%
Azerbaijani 98,7%
Armenian 98,5%
Georgian 97,3%
Ossetian 89,9%
85,0% 87,0% 89,0% 91,0% 93,0% 95,0% 97,0% 99,0%
In addition, we note a distinctly gendered dimension to old age in Georgia, as shown in Figure 5.4, where
more than two thirds (71 per cent) of old-age pensioners are women, and less than a third (29 per cent)
are men. This discrepancy reflects the facts that women can claim the pension five years earlier than
men and that women have a longer life expectancy. The life expectancy at birth for women is 78.4 years,
compared with 69.8 years for men.187
186 In addition to being less likely to receive the pension, they are more likely to qualify for the TSA.
187 Geostat. However, this gender gap in life expectancy narrows at retirement: women’s life expectancy at age 60 is 21.33
years (age 81.33), compared with men’s life expectancy at age 65 of 13.56 years (age 78.56), suggesting that men are likely
dying at younger ages due to higher exposure to risks like conflict and accidents.
X Figure 5.4:
Gender distribution of universal old-age pension recipients, 2018 (percentage)
29,0
71,0
Female Male
New accumulated pension (mandatory individual account)

As of March 2020, there were 990,296 people enrolled in the new pension scheme, amounting to
around half (51 per cent) of the labour force. However, administrative and labour force data indicate
that the scheme has enrolled 100 per cent of people formally employed in the public or private sectors,
suggesting that the scheme has potentially made inroads in terms of voluntary enrolment by the self-
employed. Earlier data from September 2019 suggested that around three quarters of enrollees were
from the private sector and a quarter from the public sector. Around 165,000 workers who were older
than the age of 40 in 2018 chose to opt out of the system after the first three months of contributions.
No additional data, including on the breakdown between employees and the self-employed, or by
gender, were available at the time of writing. However, going forward, it will be very important for the
Government to develop monitoring systems that can evaluate the performance of the pension system
from the perspective of equality, since contributory systems risk entrenching and exacerbating existing
labour market and social inequalities unless deliberate measures are put in place to mitigate them.188 The
risks of deepening gender and other inequalities are higher in defined contribution systems like the one
Georgia has implemented.189
Nonetheless, the positive early enrolment figures for the supplementary pension suggest that
initial efforts to register firms and employees have been successful. Those efforts, together with the
Government’s new incentives to encourage the self-employed to register with the tax authorities as a
condition for receiving COVID-19 one-off support (see Box 8.1), are promising steps towards the further
development and expansion of the contributory system, as well as broadening the tax base to increase
fiscal space for social protection expansion over the longer term.
188 Brimblecombe and McClanahan (2019). See Section 5.3.2 for further discussion of inequalities related to pension system
design.
189 Directorate General for Employment, Social Affairs and Inclusion of the European Commission (2018).
Universal old-age pension

Ensuring that old-age pensions are adequate relative to national and international standards is vital
for securing basic income security in old age, as called for in ILO Recommendation No. 202 on social
protection floors.190
The nominal value of the universal old-age pension has increased from GEL 14, when the differentiated
social insurance pension was first converted to a flat rate in the 1990s, to GEL 220 in 2020.191 However, like
other social transfers in Georgia, the universal old-age pension has no indexation mechanism to maintain
its real value, although the Government recently announced a plan to introduce indexation in January
2021 as part of the Anti-Crisis Plan in the wake of COVID-19.192 Instead, the Government of Georgia has
historically increased the pension on an ad hoc basis, which could in theory present significant risk for
pensioners, who could see the purchasing power of their pensions erode significantly over time if the
Government fails to act. Luckily for them, the Government has rather aggressively raised the value of
pensions over time to keep pace with inflation. Figure 5.5 shows the growth in the real value of the
pension since it was first introduced. Nevertheless, an indexation mechanism that adjusts the value of
pensions systematically according to changes in prices and/or wages could protect against the potential
for erosion in value.
X Figure 5.5:
Value of the social pension adjusted for inflation and expressed in 2020 prices,
1999–2020
250
200
GEL per month
150
100
50
0
99 000 001 002 003 004 005 006 007 008 009 010 011 012 013 014 015 016 017 018 019 020
19 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
Source: Transfer values are based on ISSA/SSA (multiple years). GDP per capita values are from IMF (2019b).
190 ILO (2012).
191 The pension is expected to rise to GEL 250 from 1 July 2020.
192 See Box 8.1.

ILO Conventions Nos. 102and 128 set minimum replacement rates for tax-financed pension levels at
40 per cent193 and 45 per cent,194 respectively, of the prevailing wage of a male manual labourer. To
approximate this benchmark, as with disability benefits, we have used the average wage for elementary
occupations in Georgia as reported by Geostat for the latest year available (2017).
Table 5.3 shows how the current universal old-age pension (State Pension) value compares with the
minimum standards suggested by Conventions Nos. 102 and 128. Despite recent increases by the
Government, the pension still falls just short of the minimally adequate monthly benefit amounts derived
from the Conventions’ replacement rates. In 2017, the old-age pension should have been at least GEL 232
per month (based on Convention No. 102) or GEL 262 per month (based on Convention No. 128), but at
the time, it was actually only GEL 180 per month. And even now, the pension is 94 per cent (Convention
No. 102) and 84 per cent (Convention No. 128) of the 2017 recommended values.
X Table 5.3:
Minimum adequate social pension levels in Georgia according to C102 and C128
National Value of Average monthly C102 adequate C128 adequate

benefit national nominal wage social pension social pension
benefit (per of elementary at 40% (per at 45% (per
month) occupations (2017)195 month) month)
State Pension GEL 220 GEL 581.20 GEL 232.50 GEL 262
(universal
old-age pension)
However, when compared with other countries that also invest in tax-financed old-age pensions,
Georgia’s pension again performs relatively well, as shown in Figure 5.6. At a value of around 20 per
cent of GDP per capita, Georgia’s universal old-age pension is positioned solidly in the upper tier of the
middle-income countries that provide a tax-financed old-age pension. The value of Georgia’s pension is
more than double the value of the social pension in the Russian Federation (9 per cent of GDP per capita),
nearly twice as high as pensions in neighbouring Azerbaijan (11 per cent) and Armenia (12 per cent) and
well ahead of other Western and Central Asian countries.
193 ILO (1952).
194 ILO (1967).
X Figure 5.6:
Comparison of tax-financed old-age pension values in select middle-income

countries, latest year available (percentage of GDP per capita)
Brazil
Uzbekistan
Paraguay
Ukraine
South Africa
Georgia 20%
Mongolia
Albania
Kazakhstan
Kenya
Armenia
Azerbaijan
Russian Federation
Ecuador
Turkmenistan
VietNam
Mexico
Philippines
India
China
0% 5% 10% 15% 20% 25% 30% 35% 40%
Source: HelpAge International pensions database and various national sources.
However, it should be noted that in nearly all of the countries,196 the tax-financed social pension is
implemented alongside a mandatory contributory (social insurance) pension. Therefore, since many
pensioners in these countries can also expect to receive much higher public pensions from the earnings-
related contributory system, the tax-financed pension should be understood as the minimum pension
they can expect to receive in old age. In contrast, in Georgia, the tax-financed old-age pension (State
Pension) constitutes the only statutory pension, meaning that many older Georgians will struggle to
maintain a standard of living comparable to their previous earnings after retirement, especially if the
State Pension is their only source of income. The new mandatory individual account system is intended to
fill this gap in Georgia, but policymakers should be aware of the likely implications of choosing a funded
pension design for future pension adequacy, since these systems tend to perform less well for people
with lower earnings (see discussion below on the new accumulated pension scheme).
196 Exceptions include Lesotho, Namibia and South Africa.

Given Georgia’s aspirations to align more closely with EU standards and practices, it is also helpful to
compare the value of Georgia’s pension to social pensions provided in Europe and other high-income
countries, keeping in mind that these countries also offer, almost universally, additional public social
insurance pensions, New Zealand being a notable exception.197 Figure 5.7 shows how Georgia’s pension
compares with tax-financed pensions in high-income countries. Georgia again performs reasonably well
at 20 per cent, though more high-income countries pay higher-level pensions in addition to the tax-
financed social pension.
X Figure 5.7:
Comparison of tax-financed old-age pension values in select high-income

countries, latest year available (percentage of GDP per capita)
Greece
New Zeland
Belgium
Australia
France
United Kingdom
Argentina
Finland
Uruguay
Italy
Sweden
Ireland
Georgia 20%
Denmark
Spain
Norway
Germany
Portugal
Canada
Estonia
Iceland
Latvia
0% 5% 10% 15% 20% 25% 30% 35% 40%
Source: HelpAge International pensions database and various national sources.
Despite the relative effectiveness of Georgia’s universal pension as a foundational tier benefit, a number
of pensioners may require additional support due to their particular family and living situations. Indeed,
analysis of the 2018 IHS shows that approximately 9 per cent of older people in Georgia also receive
the TSA. Figure 5.8 shows that the likelihood of an older person receiving the TSA varies significantly
depending on the person’s sex, marital status and disability status. Among other patterns, we observe
197 New Zealand finances most of its welfare system through taxes. However, it does have a supplementary pension (known
as New Zealand Superannuation) that is quasi-mandatory, where employees are automatically enrolled and must opt out.
that older women are twice as likely as older men to qualify for the TSA, single older people are more
than eight times more likely than married people to need the TSA, and older persons with disabilities
(regardless of the degree) are significantly more likely to need the TSA than those with no disability. Nearly
one in ten survivors are also forced to rely on the TSA, reflecting the consequences of the absence of
survivors’ benefits, which leaves the widowed pensioners (86 per cent of whom are women) facing similar
costs of maintaining a household with half the household income. These findings strongly suggest that
the old-age pension, on its own, is insufficient for older persons experiencing multiple vulnerabilities,
including those facing additional costs related to disability.
A second-tier system of pension benefits, including disability and survivors’ pensions, would go a long
way towards ensuring that many more of these older people could live independently on their own
pension income, without having to fall back on “last resort” benefits like the TSA.
X Figure 5.8:
Percentage of older people (aged 65+) receiving the TSA, by sex, marital status and
special status
40% 40%
31%
30% 30%
20% 20% 18%
13%
10% 10%
10% 10%
5%
4%
0% 0%
Female Male Married Non-registered Single Divorced Widowed
marriage
Sex Marital status
40%
30%
26% 25%
20%
17%
13%
10% 9%
7%
0%
None Group I disabled Group II disabled Group III disabled IDPs Chronic patient
Special status
Source: Based on the 2018 IHS

New accumulated pension (mandatory individual account)

As with disability benefits, the minimum standards for the adequacy of contributory old-age pensions set
out in Conventions Nos. 102 and 128 are higher than those for tax-financed pensions as the former use
the employee’s previous earnings as the reference value. According to the Conventions, old-age pensions
that have been financed by contributions must be equal to at least 40 per cent (Convention No. 102) or 45
per cent (Convention No. 128) of the insured’s previous earnings over their last 30 working years.
This would mean that the old-age pensions that will begin to be delivered through the new accumulated
pension scheme would need to be significantly more generous than the current tax-financed pension.
As an example, someone earning the average wage of GEL 1,068 in 2018 would need to contribute
enough – and generate enough return on investment – to finance a monthly annuity payment of at least
GEL 427 (Convention No. 102) or GEL 481 (Convention No. 128) to meet the minimum standard. This may
prove challenging in light of international evidence on the overall lack of success of funded schemes in
delivering adequate pensions, as explained in Box 5.1.
The ILO, which has historically set global standards for designing national social security systems, defines
social insurance as follows:
Contributory social protection scheme that guarantees protection through an insurance mechanism,
based on: (1) the prior payment of contributions, i.e. before the occurrence of the insured contingency;
(2) risk-sharing or “pooling”; and (3) the notion of a guarantee. The contributions paid by (or for) insured
persons are pooled together and the resulting fund is used to cover the expenses incurred exclusively by
those persons affected by the occurrence of the relevant (clearly defined) contingency or contingencies.
Contrary to commercial insurance, risk-pooling in social insurance is based on the principle of solidarity
as opposed to individually calculated risk premiums.198
Funded schemes, like the one recently implemented in Georgia, depend heavily on the performance
of the market to deliver sufficient returns to finance adequate retirement benefits. The current crisis
stemming from the COVID-19 pandemic brings this issue into sharp focus, as pensioners around the
world who rely on savings-based schemes are seeing their retirement benefits decline sharply.
In addition, social insurance systems offer regular and predictable income transfers throughout the
covered contingency period (whether for the long term, as with old age or disability, or the short term, as
with maternity, sickness or unemployment). While some defined contribution systems allow for periodic
benefits – such as through programmed withdrawals or the purchase of an annuity – they generally
also (and, in many instances, only) provide the option of taking the benefit as a lump sum reflecting the
employee’s and employer’s contributions, plus any interest earned from the investment of the member’s
account. In Georgia, future pensioners may choose to withdraw the benefit as a lump sum, but they
can also opt for programmed withdrawals or an annuity. Time will tell how many will choose one of
the periodic options, but the temptation is usually strong to withdraw as a lump sum in order to cover
immediate costs or make large purchases.
Paying benefits as lump sums, in effect, transfers the responsibility for sound financial management
of the savings to the individual, which is particularly problematic in contexts where financial literacy
levels are low. In Georgia, a recent survey found that usage of financial services among the population
is very low compared with other countries in the South Caucasus, despite leading the region in financial
infrastructure, like ATMs, bank branches and point-of-sale terminals199 In addition, the same study
found that poor households remain particularly underserved, suggesting that inequalities in pension
outcomes – to the extent that they depend on the member making good financial decisions – are likely to
be exacerbated among under the accumulated scheme. While the survey did not find gender inequality
in financial inclusion indicators in Georgia, globally, women tend to have lower levels of financial literacy
and are more likely to be risk-averse when making investment decisions, which can also result in lower
pension levels.200
198 Emphasis added. See “Glossary” of ILO (2017).
199 Babych et al. (2018).
200 Brimblecombe and McClanahan (2019); and ISSA (2017).

X Box 5.1: A primer on choices in pension design

When designing a contributory social security scheme, there are two quintessential options: (1)
a defined benefit (DB) arrangement, which specifies a statutory replacement rate for monthly
benefits and then sets the mandatory contribution rates necessary to finance the benefits;
or (2) a defined contribution (DC) arrangement, which specifies mandatory contribution
rates which finance accounts that are invested and earn returns. DC arrangements are often
referred to as “funded” schemes and typically consist of mandatory individual accounts, which
are managed by private fund managers. In contrast, DB arrangements are often called “social
insurance” schemes (due to their cross-subsidization and solidarity-based components) or
“pay-as-you-go” schemes (due to a financing structure whereby today’s workers’ contributions
fund today’s retirees and other beneficiaries).
Main features of DB and DC

schemes
(Usually) privately
Publicly managed funds
Partially managed funds
funded
systems,
NDCs,
minimum
Social insurance guaranteed Individual account
pensions, (defined contribution)
(defined benefit) minimum
guaranteed
retum, etc.
Risks pooled Risk borne by

the individual
Pension reforms can either be “structural” (altering the DB/DC nature of the system) or
“parametric” (altering eligibility rules, benefit or contribution levels, etc., without changing the
nature of the scheme). Since the 1980s, as traditional DB schemes faced serious sustainability
challenges due to demographic pressures, there has been a strong push for the “privatization”
of mandatory public social insurance schemes, converting them to defined contribution
schemes. The hope was that private management would bring high-investment returns,
improve benefit adequacy, deepen capital markets and increase coverage. In fact, most of the
reforms failed to meet neither these expectations nor a number of other dimensions, including
gender equality. Women fare worse on average in funded systems due to their lower earnings
and shorter careers (see Box 5.2).
Decades later, of the 30 countries in Eastern Europe and Latin America that privatized their
national pension systems, 18 have re-reformed or reversed the privatizations and reinstated
mandatory DB public social insurance models. Notably, almost no high-income, democratic
countries privatized their public pensions but instead opted for “parametric” reforms, such as
raising the retirement age or adjusting benefit levels, attesting to the popularity and staying
power of solidarity-based arrangements from which everyone in society benefits. See Ortiz
et al. (2018) for a full discussion of the lessons learned from decades of experimentation with
funded schemes.
Moreover, while public (social insurance) pension systems reduce inequality overall, thanks to
mechanisms that enable cross-subsidization from higher to lower earners (including women), there is
still a risk that labour market inequalities are reproduced and reflected in overall pension outcomes,
resulting in a “gender pension gap”. Women, in particular, tend to be disadvantaged when benefits are
tied to employment status, since women are more likely to be outside the labour market, have shorter
or more interrupted careers and have lower salaries.201 As a result, even in social insurance systems,
women tend to have lower pensions, they often fail to meet the minimum contribution requirements for
a full pension, and a significant proportion do not even qualify for a minimum pension.202 For this reason,
many high-income countries have implemented a variety of measures to mitigate these inequalities, as
explained in Box 5.2.
It is important to note, however, that many of the corrective measures used to mitigate labour market
inequalities are only possible – or at least are much easier to implement – in pension systems that are
based on solidarity and risk-pooling principles, which allow for cross-subsidization. Georgia’s new
accumulation pension system, as a defined contribution system, is based on the individualization of risk
and a tight link between contributions and benefits, which puts lower earners and workers with shorter
contribution histories – notably women – at a severe disadvantage. In the future, it will be important
for the Government to monitor these expected outcomes and put in place measures, such as minimum
guaranteed pensions (which are subsidized), to mitigate them.
X Box 5.2: Measures to mitigate gender inequalities in pension systems

Because contributory systems tend to reflect back inequalities in the labour market, especially
gender inequalities, policymakers have relied on a variety of tools to mitigate or correct these.
Some examples include:
X Equalizing retirement ages between men and women: Earlier retirement ages for women
reduce their opportunities to accumulate the required number of years for full entitlements,
leading to worse outcomes for women in retirement. Equalizing the pensionable age of men
and women can reduce these inequalities; however, care must be taken to ensure that the
changes to the retirement age do not outpace changes in society and the labour market.
X Granting caregiver credits for applicable periods spent outside paid employment: Most
countries in Europe offer credit towards contributory pensions for childbirth and childcare
but for relatively short periods; Chile and Uruguay provide pension credits for caregivers;
and many Central Asian countries reduce the retirement age for mothers or include periods
of maternity leave in the definition of covered employment.
X Strengthening “non-contributory” or tax-financed pensions: Because women are less
likely to earn entitlement to full or even minimum contributory pensions, one of the most
effective ways to address gender inequalities in pension systems is to strengthen non-
contributory pensions that de-link pensions from employment status. Georgia’s pension
system already does this through the universal pension.
X Reducing the number of years required for a minimum pension: Many contributory
pension systems offer a minimum guaranteed pension for people who do not meet the
requirements for a full career pension. Reducing the number of years required for a
minimum pension can ensure that more women meet the minimum requirements.
Source: Based on Brimblecombe and McClanahan (2019).
201 ILO (2016b).
202 Directorate General for Employment, Social Affairs and Inclusion of the European Commission (2018).
Another drawback of defined contribution schemes is that they are generally unable to offer social
security for common working-age risks, and in practice, these types of “funded” schemes are very
rarely used as a mechanism for delivering other social security benefits outside of pensions. Indeed,
only a handful of countries use funded individual accounts for anything other than old-age, disability
or survivors’ pensions. Some examples include Chile and Colombia for unemployment and Palau and
Singapore, which mandate contributions to savings accounts and a provident fund, respectively, for
health care. However, it is noteworthy that in all of the cases just cited, the individual account is in addition
to a mandatory social insurance tier.203
One of the main reasons for this is because so-called “short-term” benefits like cash sickness or maternity,
or unemployment, occur early in a worker’s life, before the worker would have been able to accumulate
a sufficient account balance under a defined contribution arrangement to replace his or her income
during the period of interrupted employment. Social insurance, specifically pay-as-you-go or defined
benefit schemes, is the only vehicle capable of delivering protection from these social security risks in
an equitable way. If the Government of Georgia were to seek to introduce an unemployment insurance
scheme, or to finance other short-term benefits in a different way to the status quo, it would likely need
to build support among social partners for a national social insurance scheme.
For these reasons and others, the ILO only endorses funded schemes as a complement – rather than a
substitute – to the basic public pensions (tax-financed and mandatory social insurance tiers).204 While it is
too soon to tell how the new contributory system in Georgia will perform over the coming decades (as the
first “full career” benefits will not be paid for another 20 to 25 years), the Government would do well to
heed the lessons from pension privatization around the world. One of the most important of these was to
strengthen the guaranteed, tax-financed, first-tier pensions to ensure that no one falls below a nationally
defined minimum floor (see Box 2.2). Georgia is already working from a solid foundation in this regard,
but it will be important for the Government to continue bolstering it, including through indexation.
5.4 Summary
The story of the coverage of Georgia’s older population is mostly a positive one. Everyone in Georgia,
apart from those few who receive a State Compensation benefit, can count on the universal old-age
pension to provide a basic guaranteed income in old age. Georgia stands out globally among countries of
similar incomes in this achievement and also compares well with social pensions in high-income countries.
However, the pension system does not currently enable most older people in Georgia to smooth their
consumption and maintain a standard of living comparable to their pre-retirement levels. Further, the
absence of survivors’ pensions for adults leaves many older people, particularly women, vulnerable.
In addition, a significant share of the elderly (around 9 per cent) is also receiving the TSA. Older women
are around twice as likely as men to qualify for the TSA, while upward of 30 per cent of single older
persons qualify compared with just 4 per cent of those who are married. Moreover, a quarter of older
persons with severe disabilities receive the TSA. These findings strongly suggest that the old-age pension,
on its own, is insufficient for older persons experiencing multiple vulnerabilities, including those facing
additional costs related to disability.
The recent introduction in 2018 of the supplementary accumulated pension scheme aims to improve
this situation for future generations of pensioners. Efforts to enrol the workforce appear to have been
successful so far, with 100 per cent of the mandatorily covered population enrolling as well as a small
share of those eligible for voluntary participation. However, as with other schemes that only cover
formally employed workers, this amounts to only around half of the labour force. This achievement
demonstrates good state capacity that can help reintroduce the habit of deducting social contributions
among employers even where participants are sceptical of the benefits.
Because benefits will not be paid out for many years, assessing their adequacy is a largely theoretical
exercise. However, global experience with pension reforms in the past few decades strongly suggests
that the design of the new pension is likely to bode poorly for those with lower earnings and shorter work
histories, notably including women. This is because funded pensions, which tie benefit values tightly to
203 Based on analysis of ISSA/SSA (multiple years).
204 Duran (2017).


where they exist.
International experience also suggests that the system in its current form would not be suitable for
the introduction of additional benefits to cover the working-age population, should the Government
want to do so. This is because accumulation- or savings-based designs depend on workers building
up significant funds to cover long-term risks like permanent disability or old age. Introducing the
possibility of withdrawal for risks (such as maternity, sickness or unemployment) at younger ages would
risk depleting the fund. A social insurance scheme would be more appropriate as an alternative – or
complementary, under a multi-tiered framework – financing arrangement for working-age risks.
Table 5.4 summarizes the legal and effective coverage of older people in Georgia under the two main
lifecycle benefits in operation.
94
X Table 5.4:
Summary of legal and effective coverage of older people in Georgia
Dimension of coverage Universal old-age pension Accumulated pension (supplementary pension)

(State Pension)
Target group All women over age 60; Beneficiary population (future): All women
all men over age 65 over age 60; all men over age 65
Contributory population:
X Current: All public- and private-sector employees
Legal who were younger than age 40 in 2018
coverage X Future: All public- and private-sector employees
Beneficiary coverage ratio: share of 100% Unknown

population over age 60 or 65
Contributor coverage ratio: share of N/A 44% of the labour force

labour force
Horizontal (extent of population) 97.4% of the older population 51% of the labour force
Vertical (adequacy/level of benefit) Medium Unknown, but:

Effective
coverage X Adequacy is a problem in defined contribution
schemes, especially for those on low incomes
X Labour market inequalities, including gender
inequalities, are reproduced in pension outcomes
X 6. Access to health care across the lifecycle in Georgia 95
X 6. Access to health care across the lifecycle in

Georgia
The Government of Georgia has explicitly recognized that health care is a right and has actively pursued
policies to extend coverage to the entire population. Since the introduction of the UHCP in 2013, the total
population with health insurance has reached nearly 98 per cent of the population, with approximately
84 per cent of the population covered under the State Health Insurance Programme.205
6.1 Legal coverage

When the UHCP was first implemented in 2013, it was truly universal in nature; however, since 2018,
the benefits have only been provided to people in Georgia with annual earnings up to GEL 40,000. The
UHCP provides varying tiers of support, financed through taxes, that take the form of the direct purchase
of services by providers and the issuance of insurance vouchers to individuals to purchase insurance.
The Social Service Agency administers the vouchers and acts as a single purchaser of health care. The
comprehensiveness of the services and the generosity of the insurance voucher depend primarily on a
person’s age and income level.
Under the UHCP, beneficiaries can receive more or less comprehensive “packages”, depending on their
income or whether they fall into a specific target group. A full comprehensive package covering primary
care, hospitalization and other services plus additional insurance is provided to young children aged
0–6, pensioners and certain other specified categories (such as IDPs). Older children and people of
working age subject to income tests can receive a basic package plus additional insurance, and the
self-employed and certain others can receive a limited package of services as well as a limited insurance
voucher covering emergency services and oncological treatment. Table 6.1 summarizes the key features
of the UHCP, its packages and their respective eligibility requirements, and Annex 4 summarizes the
services and user charges (where applicable) for different target groups.
6.2 Effective coverage

Including those covered through employer-provided or privately purchased insurance plans, virtually the
entire population (98 per cent) has access to health insurance, which is a laudable achievement, despite
recent restrictions that imposed an affluence test on the previously universal programme. Of those who
are insured, Georgia’s near-universal health insurance programme accounts for around 92 per cent of the
covered population, as shown in Figure 6.1. Private insurance, provided through either employer-based
plans or other private schemes, accounts for a small share of the insured population, around 8 per cent.
Of the insured population, old-age pensioners are the most likely age group to benefit from government
vouchers (98 per cent), while working-age persons are least likely (89 per cent), and a significant share
(9.3 per cent) of insured children are covered under private plans.
Health-care provision is almost entirely private in Georgia, with the State providing subsidies for the
purchase of insurance. The UHCP (also known as the State Health Insurance Programme) consists
of a number of different subsidy schemes targeting different segments of the population, but other
household members can also be covered by these programmes. As Figure 6.2 shows, 14.7 per cent of
those insured are children aged 0–5 covered under the programme, 32 per cent of the insured population
is covered by vouchers for pensioners, and around half the population (46 per cent) receive other types
of state health insurance support (e.g. for low-income groups, for those without health insurance or for
specifically defined vulnerable groups). Overall, only 3.6 per cent of the population is insured at their own
expense, and only around 4.4 per cent are covered through employer-based plans.
205 Analysis of the 2018 IHS.

96
X Table 6.1:
Health-care benefits across the lifecycle in Georgia
Main statutory features of the UHCP

Scheme Type of scheme Regulatory Legally covered Financing Qualifying Description Administrative
framework population arrangement conditions of benefits responsibility
Universal Health Means-tested, Law of Georgia Citizens of State budget No minimum State-provided SSA
Care Programme non-contributory on Health Georgia with qualifying health-care
(UHCP, national Care (1997) annual income period206 services and
health insurance) up to GEL 40,000 personal
insurance are
Stateless
financed by the
persons residing
issuance of a
permanently
voucher (package
(legally) in
depends on
Georgia
income and
special status)207
206 See Annex 4 for a description of the beneficiary categories.
207 See Annex 4 for a detailed description of benefits according to status and income.
X Figure 6.1:
Percentage of the population covered by health insurance, by type of insurance

(broad) and age group, 2018
8,1% 91,9%
Total
2,1% 97,9%
People above retirement age
10,8% 89,2%
Working-age adults 16+
9,3% 90,7%
Children aged 0-15
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Private insurance State Health Insurance Programme
X Figure 6.2:
Distribution of health insurance, by type of insurance (detailed), 2018 (percentage)
4,4%
3,6%
Insurance at employer`s expense
Insurance at own (household`s) expense

14,7%
45,9% Insurance for children aged 0-5 within the scope

of State Health Insurance Programme
Insurance for pension-aged persons within the

31,2% scope of State Heaith Insurance Programme
Insurance for students within the scope of State

Health Insurance Programme
Other insurance within the scope of State Health

0,1% Insurance Programme

While coverage is high across all age groups (see Figure 6.3), the coverage among younger adults is
lower, with 92 per cent of those aged 20–24 covered and 94 per cent of those aged 25–29. While there
are income-tested and categorical subsidies that cover many of those in these age groups, the slightly
lower coverage could be attributed to there being no age-specific health subsidy for young adults, while
high youth unemployment means that a large number of unemployed young adults are unable to access
employer-provided insurance.
Finally, based on administrative data, women accounted for a larger share of UHCP beneficiaries. In
2019, some 440,435 women received support through a form of state subsidy, whereas only 393,255
men did.208 Most of this difference can be attributed to the unequal gender distribution among old-age
pensioners, 70 per cent of whom are women. Indeed, only around 35 per cent of all UHCP vouchers for
pensioners were men.209

While the wide-reaching horizontal coverage is clearly an achievement, some important gaps remain
when assessing the adequacy of health benefits in Georgia. For example, private individuals are still
paying more than half the cost of health care: in 2017, out-of-pocket expenditures on health care
represented 54 per cent of the total expenditure on health in Georgia,210 suggesting, among other things,
that there is a substantial degree of topping up of the basic state-sponsored package. Around two thirds
of these out-of-pocket payments go to pharmaceuticals.211
X Figure 6.3:
Percentage of the population with health insurance, by age, 2018
100%
98%
96%
94%
92%
90%
l
4
4
9
9
+
4
ta
-4
-1
-1
-2
-2
-3
-3
-4
-5
-5
-6
-6
-7
5-
80
0-
-7
To
40
10
15
20
25
30
35
45
50
55
60
65
75
70
208 Analysis of SSA administrative data.
209 Ibid.
211 Richardson and Berdzuli (2017).
Equally, when measured as a share of total household consumption, the out-of-pocket burden is
very high compared with OECD countries. On average, Georgians spend around 5.9 per cent of their
monthly expenditures on health care.212 In the OECD, the countries that spend the highest proportion of
household consumption on health care are Switzerland (5.4 per cent) and Korea (5.1 per cent). The OECD
average is 3 per cent, almost half what is spent by Georgians, as shown in Figure 6.4.
X Figure 6.4:
Out-of-pocket medical spending as a share of final household consumption, 2015

or latest year available
%
7
5,9
6
5,3
5,1
5
4,4
4,4
4,1
3,9
3,8
3,7
3,6
4
3,4
3,3
3,2
3,1
3,1
3,1
3,0
3,0
3,0
2,9
2,7
2,6
2,6
3
2,5
2,5
2,5
2,4
2,4
2,3
2,2
2,1
2,0
1,8
2
1,5
1,4
1,4
1
0
er an
Ch y
e l
d
Au ium
Fr rg
Un G ove d
L le
Ja k
Ze a
Fin ly
Po an
M ain
m m
Ko d
OE tria
ite er nia
Au nd
Sp l
rtu a
nm ia
Un I and
Sw rae
Gr rea
nd
Be den
ec ep ds
ico
Ic lia
No 34
Lu ing ny
pu ic
Hu ece
Es ay
ce
r s
ar
ga
Ne an c
ar
an
w ad
Sl lan
Po atvi
n
itz rgi
ov e e
Ita
i
De ton
Re ubl
xe do
i
u
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bl
Cz ak R lan
an
ra
ng
Sl eth Stat
la
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la
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ite rela
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lg
e
l
Sw eo
st
C
G
K
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N
Source: Reproduced from OECD (2017, fig. 5.7). Georgia value is based on analysis of the 2018 IHS.
While the burden of out-of-pocket health expenditures is relatively evenly distributed across income
deciles, it is most severe among those in the middle deciles, as shown in Figure 6.5. This finding is
consistent with the distribution of subsidies, which heavily favour those in lower-income deciles. The
expenditure on health care relative to household consumption is lowest for the highest two consumption
deciles, reflecting significantly higher consumption levels among the highest income deciles.
In addition, we can observe that people experience higher-than-average out-of-pocket expenditures
if they live in certain regions, in Imereti, Racha-Lechkhumi and Kvemo Svaneti, or Samtskhe-Javakheti,
as shown in Figure 6.6. (Expenditures are also high in Tbilisi but so are incomes; thus, in relative terms,
expenditures are around the national average.)

X Figure 6.5:

household consumption expenditure, by consumption decile, 2018
10%
9%
8%
6,6% 6,9% 6,8%
7% 6,2%
5,8% 5,9% 6,2%
6% 5,4% 5,1%
5%
4% 3,3%
3%
2%
1%
0%
Deciles of households, ranked by per capita consumption
X Figure 6.6:

household consumption expenditure, by region, 2018
Imereti;Racha-Lechkhumi and Kvemo Svaneti
Samtskhe-Javakheti
Kakheti
Tbilisi
Adjara A.R.
Kvemo Kartli
Samegrelo-Zemo Svaneti
Shida Kartli
Guria
Mtskheta-Mtianeti
0,0% 1,0% 2,0% 3,0% 4,0% 5,0% 6,0% 7,0% 8,0% 9,0% 10,0%

X 7. Social protection and women and girls in Georgia: A summary of initial findings 101
These high out-of-pocket payments can have serious impacts on people’s ability to access the care they
need. This is particularly true for women, who experience some key gaps in covered services that reflect
in poor outcomes overall. For example, Georgia has a higher-than-average lifetime risk of maternal death
relative to other countries in Eastern Europe and Central Asia, which can be explained in part by the
lack of high-quality antenatal care and weak monitoring systems, particularly for women living in the
regions. In addition, the UHCP basic package does not include some of the fundamental components
of women’s reproductive and preventive health, including access to family planning counselling and
contraceptives.213
6.3 Summary
While Georgia has succeeded in extending health insurance coverage to virtually the entire population,
the vast majority of whom are insured under the near-universal UHCP or State Health Insurance
Programme, the story of vertical extension (adequacy) is less positive. Compared with high-income
countries, Georgians on average spend significantly more than the OECD average on out-of-pocket
health expenditures as a share of household consumption, at around 6 per cent. Those in middle-wealth
deciles bear a heavier burden due to lower available subsidies. Private spending also accounts for around
half of total health spending (54 per cent) in Georgia,214 suggesting, among other things, that there is
a substantial degree of topping up of the basic state-sponsored package, where sometimes essential
components of preventive health, such as contraceptives, must be purchased privately.
Therefore, while the support that the Government offers Georgians through the UHCP likely prevents
most people from catastrophic health expenditures, many people, especially those who are not eligible
for subsidies or who are only eligible for relatively meagre ones, still incur significant health-care costs.
213 UN Women (2020b).

X
X 7. Social protection and women and girls in

Georgia: A summary of initial findings
Women, because of their unique life course and position in the labour market, are more likely to need
the social protection system at key stages of their lives. The analysis in this report has emphasized the
unique challenges that women face due to the combination of their life course and highly gendered
labour markets. These inequalities can be mitigated by gender-responsive policies, including social
protection policies. However, the social protection system itself can also exacerbate gender inequalities if
not carefully designed. The interactions between gender and social protection are complex and mediated
by the life course, where risks faced in childhood may be very different from the risks faced in adulthood
or old age.
Some key gaps and the reasons behind them are clear, while others call for more in-depth analysis.
Overall, women are more likely to benefit from the social protection system across the lifecycle, except
during working age. The following paragraphs summarize the main findings from the preceding analysis
and should help guide an agenda for future research into the particular gender dynamics at play in
Georgia’s social security system.
7.1 Children
Girl children face a number of challenges in Georgia, particularly among certain segments of the
population. There is still an overall preference for sons, as reflected in the sex ratio at birth, as well as
early marriages, and there remains a lack of youth-friendly health-care services, all against the backdrop
of significant economic hardship.215
Three key findings stand out with respect to the social protection and gender nexus among children:
X Girl children are, overall, more likely to live in poverty than boy children, with the gap particularly
pronounced for the youngest children (aged 0–4) and older children (aged 10–14).
X However, the distribution of male and female beneficiaries in the poverty-targeted CBP is relatively
even. Because girl children only make up 48 per cent of the child population, and girls are slightly more
likely to be poor, the even sex distribution of CBP beneficiaries disguises the fact that girls are actually
more likely to benefit from the programme than boys (15 per cent of girls receive the CBP, compared
with 13 per cent of boys).
X Key components of sexual and reproductive health care, including contraceptives, are lacking in the
UHCP packages, leaving youth and adolescent girls vulnerable.
7.2 Working-age people

Gender inequalities in Georgia, as elsewhere, are often most pronounced during working age, when
women face a double burden of work outside and inside the home. It is no surprise, then, that women
are significantly more likely to be inactive than men, with young women more likely than young men
to be not in employment, education or training (NEET). Women’s lower labour force participation is
largely due to the fact that women are far more likely than men to be caregivers and to take time out of
paid employment for family leave and child-rearing. Many women work informally and are particularly
vulnerable in certain types of employment that lack basic protections, like domestic work. Moreover,
women working informally earn, on average, around 42 per cent less per year than those in formal
employment.216 These vulnerabilities are reflected in a significant gender pay gap: on average, women’s
earnings amounted to only 64 per cent of men’s in 2018, and in general, men benefited more from
increased salaries than women in recent years.217
215 UN Women (2020b).

216 UN Women (2018).
217 UN Women (2020a).
X 7. Social protection and women and girls in Georgia: A summary of initial findings 103
The social security system can either mitigate or exacerbate these labour market inequalities, largely
depending on the way individual policies are designed. The analysis has shown that gender and social
protection interact in a number of ways for people of working age:
X A number of key lifecycle benefits during working age (including maternity protection, paid sick leave
and the right to build up savings in the accumulated pension system) are reserved for those in formal
employment. This leaves out more than half of working women in Georgia. For maternity, less than a
third of women of reproductive age (aged 15–49) can expect to receive income support in the months
following childbirth.
X In the case of maternity benefits, the exclusion of inactive or informally working women is particularly
egregious as the benefits are financed from the state budget, which includes revenue from income
taxes (paid by formal employees) as well as consumption taxes, which are paid by everyone, resulting
in a regressive financing arrangement in which those outside of formal employment are in effect
subsidising maternity benefits for the formal sector.
X For those in the private sector who do qualify for maternity benefits, as well as much of the public
sector (excluding civil servants), existing benefit levels are wholly inadequate, in most cases replacing
only a fraction of women’s lost earnings, and are far lower than the two thirds required of ILO
Convention No. 183.
X The new accumulated pension scheme is very likely to reproduce and exacerbate existing gender
inequalities in the labour market, and the savings-based design poses steep challenges for introducing
redistributive measures within the scheme to mitigate these inequalities.
X Working age is the only age group in which men are more likely to benefit from the social protection
system (16 per cent of men receive transfers, compared with 13 per cent of women). This is despite the
fact that there are more benefits theoretically available to women than men (since there are no paid
paternity benefits). The discrepancy in coverage is explained by the inadequate provision of maternity
benefits as well as the unequal distribution of Social Package disability beneficiaries, 60 per cent of
whom are male.
7.3 Older people

Of all age groups, older people in Georgia are least likely to be poor. This is due to the impact of the old-age
pension and universal health care (including a comprehensive package of benefits for pensioners), which
reach nearly all older people in Georgia.
The analysis uncovered a number of gendered dynamics among older persons in the social protection
system:
X While there is a survivors’ benefit for children, adults have no social protection in case of the death
of a spouse or partner and the associated loss of the spouse’s or partner’s income. The absence of
survivors’ pensions for adults creates a specific disproportionate disadvantage for women. Based on
the IHS, 86 per cent of all widowers are female and 14 per cent are male, largely reflecting women’s
longer life expectancy. Around one in ten older survivors receive the TSA.
X Global experience with pension reforms in the past few decades strongly suggests that the design
of the new pension is likely to bode poorly for those with lower earnings and shorter work histories,
notably including women. This is because funded pensions, which tie benefit values tightly to
where they exist.
X There are indications that the old-age pension is not adequate, particularly for people experiencing
multiple vulnerabilities. Women, owing to their longer life expectancy, are reliant on the universal
pension over a longer period than men; therefore, the adequacy of the universal old-age pension is
particularly relevant for them. Older women are twice as likely as older men to rely on the TSA (10 per
cent versus 5 per cent), but this gap is largely explained by women’s longer life expectancy, since older
women on average are just as likely as older men to be poor.
Despite the gaps discussed above, national figures show that in general, poverty rates are slightly lower
for women. This most likely reflects the slightly higher coverage of social protection among women than
men, especially in old age.
This analysis has demonstrated that the gendered nature of the life course and labour markets requires
the social protection system to be particularly responsive to gender-based inequalities. However, the
social protection system, with its focus on income redistribution across wealth groups and generations,
is only one component of the broader set of gender-responsive tools available to governments to address
structural inequalities, including those that begin in the household.
The following chapter offers a potential way forward for closing a number of these gaps.
X 8. Towards an inclusive lifecycle social protection system in Georgia 105
X 8. Towards an inclusive lifecycle social protection

system in Georgia
The impact of Georgia’s social security system on the welfare of its population is undeniable. Without key
lifecycle benefits, many more people would be living in poverty or at risk of poverty than is currently the
case. While the emergence of COVID-19 was certainly unwelcome throughout the world, Georgia was
arguably better positioned than many countries of similar income levels to absorb the unprecedented
shock. This is thanks in particular to its investments in the old-age pension and universal health care. In
addition, the Government has been able to expand the TSA at a moment’s notice, largely thanks to the
investments in the administrative apparatus.
The following sections explore the impacts that the current system has had on the welfare of households
in Georgia, as well as on aggregate indicators of national welfare like poverty and inequality. Proposals
for the potential expansion of the system are then offered.
8.1 Overall performance of the existing system

Income transfers from social protection are the most direct way for governments to address income
insecurity, poverty and inequality. Indeed, across OECD countries, government transfers account for the
bulk of income redistribution when compared with taxes and social contributions.218
In Georgia, income from social protection transfers constitutes a significant share of total household
income219 – on average, across the whole population, around 28 per cent of household income derives
from transfers. 220 By a notable margin, the universal old-age pension is the single most important
programme, constituting 21 per cent of household income on average. Other schemes have much lower
coverage and transfer values and, therefore, amount to a smaller share of average total household
income. For example, the TSA accounts for 4 per cent of total household income, and the disability
pension accounts for 2.5 per cent.
The relative importance of social protection varies significantly across age groups, reflecting the very
different sets of policies aimed at children, people of working age and older people. Figure 8.1 illustrates
the relative importance of social protection across the lifecycle. Among older people above the official
retirement age, around 54 per cent of total household income derives from social protection transfers,
compared with just 17 per cent among children and working-age adults. Again, this reflects the higher
transfer values and wider coverage of the old-age pension, as well as the lower overall incomes of older
people, while significant gender differences were not observed.
Those in lower-income deciles are much more likely to rely on social protection transfers to meet their
needs, and indeed the relative importance of social protection transfers declines as households derive
more income from labour and other sources. Figure 8.2 shows the average share of household income
from social protection transfers across the welfare distribution. Those in the bottom decile of the
population derive close to half of their household income from social transfers, compared with 11 per
cent among the top decile. Women derive, on average, 30 per cent of household income from transfers,
compared with 24 per cent among men.
Overall, the social protection system is making a significant contribution towards reducing the level of
income inequality in the country. This can be illustrated by comparing the Gini coefficient of household
income with and without social transfers. The metric ranges from 0 (perfect equality) to 1 (perfect
inequality). In 2018, the Gini coefficient of per capita income was 0.391 while, when excluding income
from social protection, it was 0.505. In other words, without the social protection system, the level of
income inequality would have been nearly 30 per cent higher. However, the way that the system responds
to horizontal inequalities is complex, as Chapter 7 highlighted with respect to gender inequality.
218 Causa and Hermansen (2017).
219 Households may receive income from a variety of sources, including earnings from labour, agricultural income, remittances
from family members who have emigrated abroad, and government transfers.
220 Analysis of the 2018 IHS.

X Figure 8.1:
Average income from social protection transfers as a share of total household

income, by age, 2018
100%
80%
Percentage of income
60%
40%
20%
0%
4
9
9
+
4
-1
-1
-2
-2
-3
-3
-4
-4
-5
-5
-6
-6
-7
-7
5-
80
0-
10
15
20
25
30
35
40
45
50
55
60
65
70
75
X Figure 8.2:
Average income from social protection transfers as a share of total household

income, by decile groups of the population, 2018
100%
80%
Percentage of income
60%
40%
20%
0%

Likewise, the social protection system plays a critical role in reducing levels of poverty. Figure 8.3 shows
the estimated poverty rate across age groups if there were no income transfers from the social protection
schemes. The poverty line is set at 60 per cent of median equivalized household consumption.
X Figure 8.3:
Simulated share of the population living below the relative poverty line (60 per cent
of median equivalized household consumption) before and after receiving income
from social protection transfers, by age, 2018
100%
Poverty rate without social protection
transfers
80%
Poverty rate only social protection
transfers from old-age pension
60%
Poverty rate
Current poverty rate
40%
20%
0%
4
9
9
+
9
9
4
9
-1
-1
5-
-4
-5
80
-6
-3
-4
-6
-7
-7
0-
-2
-2
-3
-5
10
15
40
50
60
65
70
75
35
45
20
25
30
55

Note: The poverty line is fixed at 60 per cent of median equivalized household consumption after transfers.
Overall, it is estimated that in 2018, social transfers reduced the national poverty rate by half, from 40
per cent to 20 per cent. Social transfers also reduced the child poverty rate from 39 per cent to 28 per
cent and the poverty rate among working-age adults from 31 per cent to 21 per cent. The largest poverty
reduction was among older persons: without social transfers, an estimated 57 per cent of pensioners
would have lived below the poverty line, compared with 15 per cent after taking transfers into account,
amounting to a three-quarters reduction in old-age poverty.
As previous studies have shown, because of its expansive coverage and relatively high transfer values,
the old-age pension accounts for most of the reduction in these indicators.221 This is consistent with
findings from across the OECD, where, all things being equal, the size of the transfer matters much more
than the targeting (or progressivity) of the benefit for achieving its redistributive aims.222
221 See Kidd and Gelders (2015).
222 Causa et al. (2019).

8.2 Closing the gaps in Georgia’s social protection floor

According to ILO Recommendation No. 202, the aim of a national social protection floor is to provide basic
income and health security for children, people of working age and older people. Georgia’s existing social
security system already does this quite well for the vast majority of the older population and for people
with disabilities across age groups, though this analysis has outlined some noticeable gaps.
However, the analysis has also revealed a number of quite substantial gaps in the social protection floor
for children and people of working age, particularly women. These include:
X Low coverage of children under the CBP, which only reaches 14 per cent of children overall, and less
than half of all children in the lowest consumption decile
X Inadequate maternity benefits for formally private-sector workers, and absence of maternity
protection for the self-employed and women who are otherwise outside the labour market
X Absence of an unemployment insurance scheme to protect workers from catastrophic income losses
during unemployment
X Lack of mandatory employment injury insurance, although a nascent scheme is due to be implemented
this year
The arrival of the COVID-19 crisis has brought some of these issues to the fore, notably the precarious
situation of many children and the inevitable worsening of what was already a serious unemployment
situation. The crisis presents serious risks for young people as their opportunities for employment shrink
even more; for women, given their vulnerability in informal employment, the increased care burden that
accompanies lockdown measures and the higher levels of domestic abuse; and for children, whose health
and well-being suffer as a result of school closures.
In response, thanks to the investment in social protection infrastructure in recent decades, the
Government of Georgia was able to act quickly to put in place a series of emergency measures aimed at
mitigating the impacts of the global COVID-19 pandemic. The measures began in early April 2020 and
are expected to last six months. They include an emergency unemployment scheme that will provide six
months of support for employees at GEL 200 per month, together with a one-off transfer of GEL 300 per
month for self-employed persons who are either already registered or who register within a determined
window; and a temporary expansion in eligibility for TSA and CBP transfers, including a variable transfer
for families with PMT scores of 65,000 to 100,000, as well as a top-up of GEL 100 per month for six months
for families with three or more children and PMT scores up to 100,000 and for children with disabilities
or adults with severe disabilities.
The parameters for these new measures, as well as the Government’s projections for coverage and costs
of each component, are described in Box 8.1.
These measures will undoubtedly cushion the impact of the crisis for those who receive them, although
they may not be enough. This is particularly the case for those in the “missing middle” who do not qualify
for TSA and CBP top-ups or those who are unable to prove a loss of income for a variety of reasons
(including, for example, women in domestic work who commonly do not have contracts and are paid in
cash) and therefore will not qualify for the one-off support for the self-employed but who are nonetheless
affected by the general economic contraction.
In addition, temporary or emergency measures overlook the permanent nature of common lifecycle
risks. Indeed, social security, when well designed, is shock-responsive at its core; the more universal the
benefits, the higher the coverage and the more preventive and protective the system is in the face of
shocks. No doubt future analyses will demonstrate that the elderly have been likely to be least affected
by the economic shockwaves from COVID-19 in Georgia, thanks to the wide reach of the old-age pension.
For these reasons, it makes sense to begin investing now in plugging the key gaps in the social protection
floor on a permanent basis so that when the pandemic and its associated restrictions subside, the people
and economy of Georgia are even better prepared for the next crisis. The most straightforward way
X Box 8.1: The Government’s recently announced social protection response to COVID-19
On 24 April 2020, Prime Minister Giorgi Gakharia announced a new spending package, the
coronavirus “Anti-Crisis Plan”, worth GEL 3.5 billion (approximately USD 1.1 billion), of which GEL
1.035 billion will be directed towards social support for Georgia’s citizens. A series of measures
were put forth under the plan’s second stage, which began in early April. They are designed to
protect the well-being of those most vulnerable to the negative job impacts of the crisis and
those suffering from economic hardship as a result of the pandemic. The model outlines the
beneficiaries of financial support as follows:
Contracted employees who have lost their jobs or are on unpaid leave
X They will receive GEL 1,200 in assistance over a period of six months (GEL 200 per month).
X This component will cost approximately GEL 460 million and will benefit approximately
350,000 Georgian citizens.
Persons employed in the informal sector and self-employed persons
X They will receive a one-time transfer of GEL 300 if proof of loss of income can be provided.
X This component will cost approximately GEL 75 million.
Families with a PMT score of 65,000 to 100,000

X These families will receive a monthly cash transfer for six months only.
X The size of the transfer will be calculated according to the family size. For example, a one-
person family will receive GEL 70 per month; a two-person family, GEL 90 per month; a
three-person family, GEL 105 per month; etc.
X This component will cost approximately GEL 45 million and will benefit approximately 70,000
families (100,000 individuals).
Families with a PMT score of 0 to 100,000 and with three or more children under the age of 16
X These families will receive a monthly cash transfer of GEL 100 for six months only.
X This component will cost approximately GEL 13 million and will benefit approximately 21,000
families (130,000 individuals).
Persons with a severe disability (Group I) and children with a disability
X These families will receive a monthly cash transfer of GEL 100 for six months only.
X This component will cost approximately GEL 25 million and benefit approximately
40,000 citizens.
In addition, pension indexation will be introduced in January 2021. All pensions will increase by
no less than the rate of inflation. Moreover, 80 per cent of real economic growth will be added
to the rate of inflation for pensioners aged 70 and above; as such, the annual growth rate of
pensions will be higher than the rate of inflation. Pension growth will be no less than GEL 20
for pensioners younger than age 70 and no less than GEL 25 for pensioners aged 70 and above,
regardless of inflation and economic growth parameters. Approximately 410,000 pensioners
are expected to benefit from these changes.
International partners have allocated USD 3 billion to support Georgia’s response to the crisis.
The Prime Minister has pointed out that the initial amount that is to be spent on social
assistance does not cover the post-crisis economic recovery period. These measures are to be
reviewed and revised accordingly once the pandemic has ended.
Source: Georgia, The Anti-Crisis Economic Plan (2020).
to close these gaps would be to focus on three key lifecycle benefits that are either missing or largely
inadequate in Georgia. Specifically:
X A universal child benefit would immediately cover all children in Georgia aged 0–15.
X An expanded maternity benefit would cover all mothers of newborns, rather than just those in formal
employment, and would improve the value of the benefit for private-sector employees.
X A permanent unemployment scheme would cover a minimally adequate period of unemployment in
line with the minimum standards in Convention No. 102.
These benefits would offer protection for key stages in the lifecycle and would help tilt the balance of
public investment back towards younger generations to support Georgia’s growing economy.
X A child benefit would take advantage of the momentum to increase child benefits. More importantly,
it would connect working-age parents with children in the “missing middle” with the social security
system in an immediate and meaningful way through a rights-based entitlement. This positive
interaction – in contrast to the negative experience of being denied benefits through the TSA or CBP
for reasons they do not understand – builds trust in the system and, over time, fosters a greater
willingness among the general population to engage in formal labour and pay taxes.
X A maternity benefit, paid to new mothers who are outside paid formal employment, would ensure that
no mother falls into poverty as a result of having a child, while aligning the existing state maternity
benefit with international standards to improve the adequacy of the benefit for the thousands of
private-sector employees.
X An unemployment benefit would offer workers the security of knowing that they and their families
will be supported as they search for work, preventing knock-on effects in the economy related to
unemployment, including the emigration of younger workers.
The benefits could be financed through state revenues, social insurance or a combination of both
through, for example, a multi-tiered design (see Box 2.2). A social insurance system that sits atop a tax-
financed “floor” would offer the Government of Georgia more possibilities for burden sharing to raise
dedicated funds for social protection while also providing a flexible policy model that guarantees basic
protections, ensures adequacy and preserves incentives for formal work.
A multi-tiered design applied to maternity benefits, for example, might include a basic benefit for those
who are not in formal employment (Tier 1) and a higher-rate, contribution-financed benefit for those
who have contributed to a social insurance fund through employment (Tier 2). Maternity benefits for the
private sector are currently financed from the state budget, which itself is partly financed from a 20 per
cent income tax on employees deducted at source. Unlike in the vast majority of countries in the world,
and nearly all countries in Europe, employers in Georgia currently do not pay anything for maternity
benefits.223 Directing a dedicated portion of this deduction (or levying an additional small contribution)
to a social insurance fund to which employers also contribute, could offer a way to make explicit what
is currently an implicit investment while also increasing revenues by sharing responsibility for social
reproduction with employers. A contribution-financed maternity benefit could be more adequate
than the current benefit, aligning Georgia with international standards and practice in maternity
benefits. Finally, providing a lower-rate, but adequate, maternity benefit to those who are outside the
contributory system would be a fair and equitable way of ensuring that the right to maternity protection
is guaranteed and extended to all new mothers in Georgia while also preserving the incentive to join
formal employment.
Child benefits and unemployment benefits could be similarly multi-tiered if the Government were to seek
alternative means of financing them, though in all cases, care would need to be taken to ensure that the
levels of the respective benefits do not create disincentives to work.224
Regardless of the design the Government chooses, the first priority must remain to cover all persons for
the key lifecycle risks outlined in Convention No. 102 and called for in Recommendation No. 202 on social
protection floors. Expanded child benefits, expanded maternity benefits and a basic unemployment
223 For detailed information on maternity protection legislation around the world, see ILO (2017, table 5.B). See also ILO
(2016a).
224 See McClanahan and Gelders (2019).

scheme offer a good starting point. An initial costing exercise suggests that this package of benefits
would not be prohibitively costly.
Table 8.1 summarizes the potential costs of introducing or expanding these benefits as a percentage of
GDP,225 based on the following parameters:
X A child benefit equal to GEL 50 per child per month, paid to all children in Georgia aged 0–15
X A multi-tiered maternity benefit that includes:
X Higher benefits for private-sector employees to GEL 575 per month (roughly equal to 70 per cent
of the average nominal wage for women in 2018) for four months (Option 1) or six months
(Option 2)226
X A lower-rate maternity benefit for the self-employed and others who are not formally employed at
GEL 220 per month for four months (Option 1) or six months (Option 2)227
X An unemployment benefit at either GEL 262 per month (roughly 45 per cent of the average wage of
elementary occupations) or GEL 467 per month (roughly 45 per cent of gross average wages) for 13
weeks 228
It is important to note that the costing exercise only puts forward a rough estimate of the potential cost
of such schemes in order to facilitate further discussions and prioritization by the Government in the light
of the assessment of the social protection system delivered in this report. A detailed costing study would
need to be carried out that takes into account nuanced parameters and preferences moving forward.
In particular, both the higher-rate maternity benefit and the unemployment benefit, if implemented,
should be tied to the employee’s previous wages if they are to meet the minimum standards laid out in ILO
Conventions. In the absence of accurate wage data, we have used publicly available average wage rates
that take no account of the distribution of wages across income groups, gender, sectors and occupations.
Moreover, if the Government were to seriously explore introducing a social insurance scheme to cover
these (and potentially other) risks, a detailed actuarial model would need to be developed to estimate
the contribution rates (based on the general average premium) required to finance the benefits now and
into the future. Doing so is beyond the scope of this report.
Estimates of the size of the programme groups were derived from the UN’s World Population Prospects
and the ILO’s modelled estimates of unemployment, while GDP figures were taken from the IMF’s World
Economic Outlook. It is important to note that these figures do not yet take into account the impact
of the global COVID-19 pandemic, so unemployment and costs as a percentage of GDP are likely to be
underestimated.
As Table 8.1 shows, a universal child benefit, paid to all children aged 0–15, would cost around the same
amount (1 per cent of GDP) as the Government currently spends on the TSA but would reach many more
households, including those that are currently being missed by the TSA and CBP but are nonetheless
considered poor. In addition, universal child benefits, even though they are paid to everyone, tend to be
highly redistributive because they are a flat rate – making them relatively more important as a source
of income support among poorer families – and because poorer families often have more children,
which means the aggregate amount would be larger for larger families, despite potential economies of
scale (reduced marginal costs) of having additional children.229 Furthermore, under progressive personal
income tax models, governments can usually recoup the benefit from higher earners through the tax
system, thereby partially offsetting the cost of the scheme. In addition, child benefits could be universally
designed but progressively implemented in the face of budget constraints. In other words, a universal
225 A detailed actuarial model would be needed to estimate potential contribution rates (based on the general average
premium) required to finance the benefits now and into the future. This is beyond the scope of this report.
226 ILO Convention No. 183 calls for a benefit of at least two thirds of the insured’s previous wages to be paid for at least 14
weeks. Option 1 would extend that slightly, in line with certain national proposals, to 70 per cent, and to four months rather
than 14 weeks. Option 2 would maintain the de jure six months covered in existing legislation.
227 GEL 220 per month is equal to the value of the old-age and Group I disability benefit.
228 ILO Convention No. 102 (Articles 24 and 67) calls for a benefit to be paid at 45 per cent of the insured’s previous wages for
the duration of unemployment, up to at least 13 weeks.
229 Donni (2015); and Letablier et al. (2009).

child benefit could be implemented first for younger age groups (e.g. children aged 0–3), but the
upper-age threshold for eligibility could rise each year to ensure that no child who was initially enrolled
would ever lose their benefits. Gradually, all children up to the maximum age could be incorporated. This
system has been successfully employed, for example, in South Africa.
X Table 8.1:
Estimated annual programme costs, 2020
Scheme Programme Number Monthly Duration Annual cost Share of

group eligible transfer (months) (thousands GDP (%)
value (GEL) of GEL)
Child benefit Children 852,025 50 Not time 511,215 1.06
aged 0–15 bound
Maternity Tier 1: All 51,456 220 4 45,281 0.09
benefit: mothers of
Option 1 newborns
Tier 2: 14,369 575a 4 20,405 0.04
Employed
mothers of
newborns
Total 65,686 0.14
Maternity Tier 1: All 51,456 220 6 67,922 0.14
benefit: mothers of
Option 2 newborns
Tier 2: 14,369 575a 6 30,607 0.06
Employed
mothers of
newborns
Total 98,529 0.20
Unemployment Option A: 320,518 262 3 251,927 0.52
benefit Unemployed
aged 15+
Option B: 320,518 467 3 449,046 0.93
Unemployed
aged 15+
a
The estimated cost of the Tier 2 benefit for employees reflects the additional funding required to finance the
difference between the Tier 1 and Tier 2 benefit values, i.e. GEL 355 per mother per month. The actual value of
the transfer that employed mothers would receive under the scenario is GEL 575 per month (GEL 220 + GEL 355).
In 2019, the Government spent around GEL 13.6 million on the state maternity benefit for private-sector
employees, or around 0.03 per cent of GDP. Introducing a universal maternity benefit that guarantees
all mothers of newborns, regardless of their attachment to the labour market, a monthly income of GEL
220 for four months (Option 1) would cost less than one tenth a percentage point of GDP (0.09 per cent),
and extending this to six months (Option 2) would cost 0.14 per cent of GDP. Meanwhile, providing an
even higher benefit for the currently covered population (formally employed women) at a monthly rate
of GEL 575 for four months (Option 1) would cost an additional 0.04 per cent of GDP, or an additional 0.06
per cent of GDP for six months (Option 2). This additional cost could be financed from social insurance
contributions, if the Government were to consider a social insurance scheme that would likely imply a
minimal contribution that could be shared between employers and employees. All told, the multi-tiered
maternity benefit considered here would cost around 0.14 per cent of GDP (Option 1) or 0.20 per cent of
GDP (Option 2) and would guarantee the right to maternity protection for all women in Georgia while
also promoting formal employment.
Finally, a permanent unemployment benefit scheme that pays 45 per cent of gross average wages (or
around GEL 467 per month) for 13 weeks would also cost just under 1 per cent of GDP. However, it should
be noted that this estimate assumes that all unemployed people would remain on the benefit for the full
13 weeks, which is an overestimate as many people would be unemployed for much shorter periods.230
A less generous option for the transfer value of GEL 262 per month (45 per cent of the average wage for
elementary occupations), which is closer to the amount provided under the emergency unemployment
scheme, would cost significantly less, at 0.52 per cent of GDP.
Perhaps more than any other benefit, it would be important to finance an unemployment scheme with
contributions from employers and employees in a social insurance arrangement. In this way, the costs
of the scheme are shared by social partners who collectively experience the consequences of high
unemployment. Unemployment insurance, especially when combined with active labour market policies,
helps workers maintain their attachment to the labour market while they search for work. Employers
230 However, no data were publicly available on the average duration of unemployment in Georgia.
have an interest in avoiding the de-skilling that can occur when people detach from the labour market
or, worse, emigrate in search of employment elsewhere. And contrary to conventional wisdom, social
contributions are not associated with higher unemployment rates at the aggregate and can actually
increase revenues and profitability among firms that comply.231
All told, filling these key gaps in Georgia’s social protection floor would cost around 2 per cent of GDP,
but the costs could be shared between social partners if awareness could be raised about the benefits
of investing in inclusive lifecycle social security – to individuals, to society, to firms and to the economy
at large.
8.3 Additional measures to consider

for a more equitable system
While investing in the core benefits cited above would help fill urgent gaps in Georgia’s core social
protection floor, this report has also highlighted a number of gaps and areas for improvement,
particularly regarding provisions that have negative implications for gender equality. Addressing these
gaps should be part of a wider conversation in the Government about the overall gender-responsiveness
of the social protection system. In particular, the analysis has uncovered the following gaps:
X The lack of survivors’ benefits for adults puts surviving spouses, the vast majority of whom are
women, at risk as the loss of income from pensions can be a major shock to overall household income,
even as the costs of maintaining the household may change very little.
X A lack of paid paternity benefits or shared parental benefits sends a message that women are solely
responsible for the care and welfare of children. This reinforces traditional norms and expectations
around gender roles, which are then reflected in labour market outcomes and other areas of the social
protection system, creating a vicious cycle.
X The lack of redistributive mechanisms, such as caregiver credits or a minimum guaranteed
pension, in the accumulated pension system will almost certainly exacerbate existing labour market
inequalities, with serious implications for lower earners and for women in particular, given their
shorter careers and lower lifetime earnings.
X On the administrative side, a reliance on self-selection and on-demand processes and an associated
failure to invest in awareness-raising or appropriate monitoring tools, including data collection
and adequate grievance structures, to strengthen accountability have hindered the ability to properly
assess coverage and access. These administrative weaknesses prevent socially excluded groups from
accessing benefits that they are entitled to.
Potential measures to address these gaps include the following:
X Extending the existing Social Package survivors’ benefits, which are currently restricted to child
survivors, to include adult survivors
X Introducing mandatory paid paternity benefits or shared parental benefits that include a portion
of non-transferable leave reserved for fathers
X Introducing a risk-pooling mechanism within the accumulated pension system that would enable
recognition of the time spent outside of paid employment for caregiving and provide a minimum
guaranteed pension for those who meet a minimum qualifying period
X Conducting a full review of the monitoring and evaluation structures within the Ministry of IDPs and
the SSA to help the Government pinpoint the specific weaknesses in the governance and administrative
structures and suggest concrete ways to remedy them, thereby helping disadvantaged groups fully
realize their right to social security already embedded in legal frameworks
These measures should be considered as part of a wider conversation in the Government about equity
and the overall gender-responsiveness of the social protection system.
231 See ILO/ISSA forthcoming data portal for the lack of association between unemployment rates and contribution rates
globally; see, for example, Lee and Torm (2017) on the social security and firm performance among small and medium
enterprises in Viet Nam.
8.4 Summary
Georgia’s system already performs relatively well, largely driven by the impacts of the old-age pension on
poverty and inequality. However, key gaps in social protection provision remain, particularly for children
and people of working age. Filling them – through a universal child benefit, an expanded maternity
benefit system and an unemployment scheme – would go a long way towards ensuring that no one in
Georgia is unintentionally neglected during these common lifecycle contingencies. Additional measures –
such as extending survivors’ benefits to adults, introducing mandatory paid leave for fathers, embedding
risk pooling within the new contributory system and conducting a full review of the system’s monitoring
and evaluation mechanisms – would also contribute to a more equitable and gender-responsive social
protection system in Georgia.
Moreover, such a system would not be prohibitively costly. Implementing all three of these benefits
would cost around 2 per cent of GDP, and less ambitious options that would offer basic protections would
cost even less. Pooled financing arrangements could alleviate the burden on the State to finance these
benefits while also building support among society and social partners for a social security system that
is fit for a growing economy like Georgia’s.
X 9. Conclusions
Georgia’s social security system is already quite well developed when compared with many countries of
similar income levels around the world. Many elements of the system are inclusive and organized around
lifecycle contingencies, and the system stands out for its expansive coverage of older people through
the old-age pension. Universal disability benefits are another achievement, though some questions
remain about the full reach of the benefits. The introduction of a per-child benefit through the CBP also
represents progress towards amplifying lifecycle programmes as core components of the national social
protection system.
Moreover, the capacity to govern and administer the social protection system is high on the whole. There
is room for improvement in certain aspects – notably including strengthening monitoring to ensure
that existing rights and entitlements are communicated, particularly around disability and sickness
benefits, and giving greater attention to accountability mechanisms beyond just the court system and
the Ombudsman’s Office. However, the core administrative apparatus is streamlined, responsive and
largely effective, albeit with challenges, offering a solid platform for future expansion.
Despite the overall achievements, there is still a strong reliance on inherently flawed poverty-targeting
mechanisms like the PMT to identify households in need, which occupies disproportionate administrative
and policy resources in the national social protection space. Non-lifecycle programmes like the TSA have
a legitimate place in every social security system, but the TSA cannot replace lifecycle programmes, which
are designed for everyone when they inevitably experience common risks. Even with improvements
to the formula and high administrative capacity to follow through on the policy, the advantages of
continuing to invest so heavily in these tools are questionable.
This is particularly true when the benefits of existing lifecycle programmes are demonstrably apparent
and when there are still key gaps in basic provisions for core contingencies, particularly those affecting
young families with children. For example, the vast majority of women lack basic maternity protections;
there is no unemployment protection; and child benefits reach only a tiny fraction of children, including
those deemed to be “in need”.
In addition, existing provisions are, in some cases, inadequate. This is the case for maternity benefits,
which barely amount to 20 per cent of women’s average wages. It is also arguably the case for old-age
pensions, which, despite comparing relatively well with other basic-tier social pensions around the world,
fail to allow for consumption smoothing for the vast majority of pensioners and fall well short of being
sufficient for those with multiple vulnerabilities, such as elderly disabled persons, who far too often have
to rely on the TSA to avoid poverty.
The Government’s recent introduction of a funded pension scheme is intended to address some of
these issues; however, the chosen design has a number of limitations. These include an absence of
mechanisms for redistribution or cross-subsidization; a tendency to reproduce and exacerbate labour
market inequalities, including gender inequalities; a reliance on the performance of the market to deliver
adequate returns; and an inability to offer income security for working age or short-term risks, among
other significant challenges. It will be important to anticipate these issues as the system matures and to
put in place measures to guarantee a degree of income security for those who have contributed during
their working lives.
The COVID-19 crisis presents an opportunity for the Government of Georgia to focus precisely on those
gaps that this report has spotlighted. Temporary, targeted measures like the ones proposed by the
Government will offer temporary and targeted relief, whereas the need for social security at different
points in the lifecycle is both permanent and universal. Simple, tried and true policies, like unemployment
insurance and maternity insurance, or universal child benefits – which could be implemented
progressively – not only would enable Georgia to better weather the next crisis but would also set it on
a path to a more developed welfare system, fit for a country with aspirations of joining the European
Union.
X Annex 1. Summary of legal and effective coverage of lifecycle schemes
in Georgia
Lifecycle Benefit Legal coverage Effective coverage

stage
Target group Share of population Horizontal coverage Vertical coverage
(adequacy)
Childhood Child Benefit All children up to age 16 14% of all children 14% of all children, but: Medium to high
Programme (CBP) living in households with
(Or the poorest 12%– X Only 43% of children in the
PMT scores up to 100,000
28% of children) lowest consumption decile
(Or all poor children) X Only 25% in the second
lowest consumption decile
Child disability Children with disabilities Actual share of children 0.9% of all children, but: Medium to high
benefit (Social (assessed with Group with disabilities in child
X Nearly all (99%) children
Package) I, II or III disability) population unknown; global
estimates are around 5%
X Unknown number of
unassessed children
Survivors’ benefit Children with one or Actual share of orphans in 1.8% of all children, but: Medium to high
(Social Package) both parents deceased wider population unknown
X Unknown number of
children who have lost
a parent but have not
applied for benefits
Working Disability benefit Persons of working age with Actual share of persons 80%–100% of adult Medium
age (Social Package) disabilities (assessed with of working age with registered disabled
Group I, II or III disability) disabilities unknown population, depending on
the degree of disability
Global estimates
range from 15% to 19% Actual share of working age
(including older people) with disabilities unknown
X Annex 1. Summary of legal and effective coverage of lifecycle schemes in Georgia
117
118
Lifecycle Benefit Legal coverage Effective coverage

stage
Target group Share of population Horizontal coverage Vertical coverage
(adequacy)
Working Maternity All formally employed 53% of female employed Approximately 95%, but Low
age benefits (state women population data constraints prevent
benefit for precise estimates
46% of the female labour force
private sector and
employer liability 28% of the total
for public sector) female population of
reproductive age
Paid sick leave All formally employed 51% of employed population Unknown (no administrative Medium to high
(cash sickness persons (including agriculture) data available on
benefits) take-up rates)
44% of the labour force
Employment All persons employed in Unknown (regulations N/A N/A
injury insurance hazardous professions in progress)

(as defined by law)
Old age Universal old-age All women over age 60; Beneficiary coverage 97.4% of the older population Medium
pension (State all men over age 65 ratio: 100%
Pension)
Contributor coverage
ratio: N/A
Accumulated Beneficiary population Beneficiary coverage 51% of the labour force Unknown, but:
pension (future): All women over age ratio: Unknown
X Adequacy is a problem
(supplementary 60; all men over age 65
Contributor coverage ratio: in defined contribution
pension)
Contributory population: 44% of the labour force schemes, especially for
those on low incomes
X Current: All public- and
X Labour market
private-sector employees
inequalities, including
who were younger
gender inequalities,
than age 40 in 2018
are reproduced in
X Future: All public- and
pension outcomes
private-sector employees
X Annex 2. Additional (non-lifecycle) schemes
Statutory features of additional social protection schemes

Scheme Type of Regulatory Legally covered Financing Qualifying Description of benefits Administrative
scheme framework population arrangement conditions responsibility
Special Universal Law of Citizens of State budget Must be Between GEL 7 and GEL 344 per SSA
pensions (non-means- Georgia Georgia who recognized month (according to age, disability
for tested, non- on Social are recognized as a veteran status, marital status, etc.)
veterans contributory) Assistance as veterans of war, a
and other (2006) of war, their parent/
groups parents/children child of the
Law of
(Social and persons deceased
Georgia on
Package) recognized or a victim
Veterans
as victims of political
of War and
of political repression
Defence
repression
Forces (2018)
Assistance Universal Law of Citizens of State budget Must be Between GEL 107 and GEL 122 SSA
for IDPs (non-means- Georgia Georgia who recognized (depending on participation in the
(Social tested, non- on Social have directly as a victim “territorial struggle” of Georgia)
Package) contributory) Assistance suffered political of political
(2006) repression repression
Targeted Means- Constitution Lawful residents State budget Households GEL 60 per month for every household SSA
social tested, non- of Georgia of Georgia with PMT with a PMT score of up to 30,000
assistance contributory (1995) scores up GEL 50 per month for every household
(TSA) to 100,000 with a PMT score 30,000–57,000
Law of
per month
Georgia GEL 40 per month for every household
on Social with a PMT score 57,000–60,000
Assistance GEL 30 per month for every household
(2006) with a PMT score 60,000–65,000
GEL 50 per month for every child (aged
0–15) living in a household with a PMT
X Annex 2. Additional (non-lifecycle) schemes
score of up to 100,000 per month232
232 Under the “Income Security in Childhood” objective of the TSA, the child component is referred to as “Child Benefit”. .
119
X Annex 3. Notes on new employment injury scheme
Labour Inspection Law of Georgia on Occupational Safety – Article 5, paragraph 9, on employer

Law and regulations obligations:
(including premium
The employer is obliged to provide the employee with accident insurance during
amount, regulations
his/her work period. The requirement of this paragraph applies to heavily
around benefit
hazardous, harmful and dangerous workplaces. The rules and procedures for
levels, etc.)
accident insurance for the purposes of this Law shall be set by the Minister’s
Administrative-Legal Act.233
Comment from Labour Inspectorate:
The Minister’s administrative-legal act on rules and procedures for employment
injury insurance in the workplace should be promulgated. An international and
local expert were involved in the preparation of this document with the support
of the International Labour Organization. Meetings with representatives of
insurance companies were also held. So far, the document is in draft form and
will be adopted in the near future.
Number of firms Based on the Economic Activity Register information by the LEPL National
that would be Agency of Public Registry, as of 13 May 2020, 3,105 entities are registered
legally required as engaging in economic activities deemed “Emerging, Heavy, Harmful and
to self-insure Dangerous Works”, as approved by the Government of Georgia Decree N381
of 27 July 2018.
The list of activities that are obliged to be register as heavily hazardous, harmful
and dangerous workplaces by Governmental Decree N381 (aggregated by
category) include the following:
1. Works related to construction and construction materials
2. Works related to mining and quarrying
3. Works related to the production of ferrous and non-ferrous metals
4. Electricity, gas, steam and air-conditioning supply works
5. Works related to the extraction of coke and petroleum/oil products
6. Works related to chemical production
7. Works related to timber processing
8. Works related to forestry
9. Works related to the textile and light industries
10. Food production activities
11. Works related to transport
12. Works related to wholesale and retail (e.g. wholesale and retail trade of
motor vehicles and motorcycles and their repair; wholesale trade in solid,
liquid and gaseous fuels and similar products; etc.)
13. Works related to water supply, sewage, waste management and pollution
It should be noted that there are more companies registered as heavily
hazardous, harmful and dangerous workplaces than are required because,
according to the Law, even small cafes could be considered as hazardous,
harmful and dangerous workplaces.
233 Available at https://matsne.gov.ge/ka/document/view/4486188?publication=0.

X Annex 3. Notes on new employment injury scheme 121
Number of Not available

employees who
should be legally
covered
Number of firms Comment from Labour Inspectorate:
that have already
We do not have accurate information. As of the data obtained from the
purchased insurance
conducted inspections, 28 (5 per cent) out of 501 inspected hazardous, harmful
under the Law,
and hazardous enterprises in 2019 did not have insurance.
if relevant
Number of
employees covered
by firms that have
already purchased
insurance
122
X Annex 4. Description of UHCP services and user charges
Service area Target group

Households People registered as Uninsured Citizens with PMT Citizens Citizens Citizens
with PMT disabled, children veterans scores 70,000– earning <GEL earning from earning >GEL
scores <70,000, aged 0–5, students 100,000, children 1,000/month GEL 1,000/ 40,000/year
artistic and pensioners aged 6–18 or irregular month to GEL
laureates, income/self- 40,000/year
teachers employed
Planned Yes Yes Yes Yes Yes No No
outpatient care
Outpatient Yes Yes Yes Yes (30% co-pay) Yes (30% co-pay) No No
specialist visits
Essential drugs Yes (cap Yes (cap applies) Yes (cap applies) No No No No
applies)
Diagnostic tests: Yes Yes Yes Yes (30% co-pay) Yes (30% co-pay) No No
basic lab tests
Diagnostic tests: Yes Yes (10%–30% co-pay Yes Yes (30% co-pay) Yes (30% co-pay) No No
ultrasound, for CT scans)
ECG, x-ray
Childbirth Yes (cap applies Yes (cap applies Yes (cap applies Yes (cap applies Yes (cap applies Yes (cap applies Yes (cap applies
per delivery/ per delivery/ per delivery/ per delivery/ per delivery/ per delivery/ per delivery/
caesarean caesarean section) caesarean caesarean caesarean caesarean caesarean
section) section) section) section) section) section)
Elective surgery Yes (cap Yes (cap applies; 10% Yes (cap applies) Yes (30% co-pay) Yes (30% co-pay Yes (30% No
applies) co-pay for pensioners; with cap) co-pay
20% co-pay for children with cap)
aged 0–5 and persons
with disabilities)
Service area Target group
Households People registered as Uninsured Citizens with PMT Citizens Citizens Citizens
with PMT disabled, children veterans scores 70,000– earning <GEL earning from earning >GEL
scores <70,000, aged 0–5, students 100,000, children 1,000/month GEL 1,000/ 40,000/year
artistic and pensioners aged 6–18 or irregular month to GEL
laureates, income/self- 40,000/year
teachers employed
Chemo-, Yes (cap Yes (cap applies; 10% Yes (cap applies) Yes (20% co-pay) Yes (20% co-pay) Yes (20% No
hormone applies) co-pay for pensioners; co-pay)
and radiation 20% co-pay for children
therapy aged 0–5 and persons
with disabilities)
Emergency Yes Yes Yes Yes Yes (50% co-pay) No No
outpatient care
Emergency Yes Yes (cap applies; 10% Yes Yes (30% co-pay) Yes (30% co-pay Yes (30% No
inpatient care co-pay for pensioners; with cap) co-pay
20% co-pay for children with cap)
aged 0–5 and persons
with disabilities)
Source: Adapted from Richardson and Berdzuli (2017).

X Annex 4. Description of UHCP services and user charges
123
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X Assessment of the

Social Protection System

ISBN 9789220330364 (print), 9789220330357 (web pdf)

2 Understanding Georgia’s social protection system within a lifecycle framework...................................11

3 Social protection for children in Georgia.......................................................................................................... 35

4 Social protection for people of working age in Georgia............................................................................... 55

5 Social protection for older people in Georgia..................................................................................................76

6 Access to health care across the lifecycle in Georgia..................................................................................... 95

8 Towards an inclusive lifecycle social protection system in Georgia......................................................... 105

Annex 1 Summary of legal and effective coverage of lifecycle schemes in Georgia...............................117

Figure 6.2: Distribution of health insurance, by type of insurance (detailed),

X Abbreviations and acronyms

AFL-CIO American Federation of Labor and Congress of Industrial Organizations

Erika Kvapilova Olga Koulaeva

Key lifecycle risks in Georgia relative to ILO Convention No. 102

Children Working age Old age Key gaps in

Child Benefit Programme Cash sickness benefits State Pension No

Source: Authors ’ depiction.

Social protection for children: Progress

Percentage of children receiving the CBP, by consumption decile, 2018

Deciles of population, ranked by per capita consumption

Source: Analysis of the 2018 IHS.

Social protection for people of working age: Key provisions

Percentage of the registered disabled population receiving a Social Package

Disability pension (Social Package) Universal old-age pension

Source: Analysis of the 2018 IHS.

Social protection for older people: Noteworthy

Percentage of older persons receiving the TSA, by select background

20% 20% 18%

Source: Based on the 2018 IHS.

Health care across the lifecycle: High coverage,

Social protection and women and girls in Georgia

2 Georgia, Ministry of IDPs (2018).

Median monthly household expenditure on health care as a percentage of monthly

Source: Analysis of the 2018 IHS.

Towards a more inclusive lifecycle social

Percentage of the population living in poverty, by different national measures,

Share of population below 60% of median consumption

8 World Bank (2019).

11 See Geostat: https://www.geostat.ge/en/modules/categories/39/wages; and UN Women (2020a).

X 2. Understanding Georgia’s social protection

2.1 A lifecycle approach to social protection

Key risks across the lifecycle

Early childhood School age Youth Working age Old age

Disability and chronic illness

Source: Development Pathways’ depiction.

13 Baum et al. (2016).

Lifecycle benefits specified under ILO Convention No. 102

Children Working age Old age

Child (family) benefits Cash sickness benefits Old-age pension

Source: Authors’ depiction based on Convention No. 102.

X Box 2.1: Gender sensitivity in individual- versus household-level benefits

2.2 The role of social protection “floors”

X Box 2.2: Multi-tiered systems for universal coverage

Poorer Richer Poorer Richer

21 See Kidd (2015).

Multi-tiered disability benefits system

Children Working age Old age

Child disability benefits Income replacement scheme Old-age pension

Tax- Child disability benefits Personal independence payment (additional costs)