Samurdhi welfare scheme empowered mere 1% of recipient families: Siyambalapitiya

 Indicating a complete failure of the 28-year-old Samurdhi welfare scheme, the government revealed that only one

percent of recipient families have been empowered by the scheme, while nearly half of the recipients unduly benefited from the scheme due to a weak targeting mechanism, leaving out a chunk of poor and vulnerable families.

Taking part in the debate on the ‘Aswesuma’ welfare scheme in parliament last Friday, State Minister of Finance Ranjith Siyambalapitiya noted that only 18,638 families out of 1.76 million recipient families, or 1.05 percent, were empowered by the Samurdhi scheme in 2021.

Similarly, 21,189 families out of 1.73 million recipient families, or 1.3 percent, were empowered by the Samurdhi scheme in 2022.
Since its inception in 1996, state expenditure on Samurdhi has risen to Rs. 63.70 billion in 2022 from Rs. 664 million, with the number of recipient families benefiting under the scheme remaining largely unchanged. According to the World Bank (WB), the scheme only covered 48 percent of the country’s poorest income quintile, while nearly 12 percent of the richest income quintile unduly benefited from the scheme in 2019.

“The transparency in the process for selecting and registering beneficiaries has been limited and lacked independent oversight and accountability. Once entered into the programme, beneficiaries will continue to receive support indefinitely, leaving limited or no space for potential new eligible beneficiaries to receive support or for graduation from the programme,” WB said.

The new welfare scheme, which is supported by the WB and was passed in parliament last Friday, aims to consolidate existing social welfare schemes while allowing beneficiaries to enter and exit based on changes in 
their incomes.
Although a record 3.72 million families applied for welfare benefits under the new scheme, Siyambalapitiya noted that 11.7 percent of applicants, or 435,489 families, have not taken part in the survey to show their eligibility for welfare benefits.

Under the scheme, around 400,000 families identified as ‘severely poor’ are set to receive direct monthly cash transfers of Rs. 15,000 for three years starting from July this year, while 800,000 recipients identified as ‘poor’ will receive direct monthly cash transfers of Rs. 8,500 for three years.

In addition, 400,000 recipients identified as ‘transitional’ are expected to receive Rs. 2,000 a month until December this year, and another 400,000 families identified as ‘vulnerable’ will receive Rs. 5,000 per month until March next year. The WB has come forward to provide US$ 200 million in funding for the scheme. The government plans to increase welfare expenditure to a record Rs. 206 billion per annum amid the ongoing economic crisis. According to the WB, the percentage of the population living in extreme poverty (international poverty rate) has been estimated to rise to 5.8 percent in 2022 from 1.5 percent in 2021 and is further projected to rise to 6.6 percent this year.
The share of the population living in the lower middle-income poverty rate (US$ 3.65 in 2017 PPP) more than doubled to 25 percent in 2022 from 13.1 percent in 2021.

In addition, a record 65 percent of the population has been estimated to live below the upper middle-income poverty line (US$6.85 in 2017 PPP), up from 51.1 percent in 2021.