Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697749396625.pdf (Georgia)
ANDRIA URUSHADZE ANDRIA URUSHADZE COVID-19 CHALLENGES AND COVID-19 CHALLENGES AND SOCIAL POLICY OPTIONS SOCIAL POLICY OPTIONS FOR THE GOVERNMENT FOR THE GOVERNMENT OF GEORGIA OF GEORGIA კოვიდ-19 გამოწვევები და სოციალური პოლიტიკის ვარიანტები საქართველოს მთავრობისთვის PREPARED BY ANDRIA URUSHADZE Tbilisi 2021 ანდრია ურუშაძე CONTENT CONTENT Brief overview and key messages ...............................................................................................................3 1.

Life or economy?
Life or economy?

Social consequences of lockdown-dependent strategy and its alternative ..........................................................................................................................................5 2.

Social protection programs in the conditions of Covid-19 pandemic ......................................................9 2.1.

Costs of pandemic-related social programs ...................................................................................9 2.2.
Types, duration and reach of social assistance programs ............................................................10 3.

Pandemic-related anti-crisis plan and social protection programs in Georgia ......................................11 3.1.

Social protection programs ............................................................................................................11 3.2.
Indexation of pensions and access to pension accounts ..............................................................13 3.3.

Right to use pension savings for citizens of non-retirement age ................................................... 14 4.

Conclusions and recommendations ..................................................................................................... 15 5.
Literature ..............................................................................................................................................16 This publication was made possible with the support from the American People provided through the United States Agency for International Development (USAID).

Responsibility for the content of the publication lies with the Economic Policy Research Center (EPRC) alone and it does not reflect the views of the USAID or the Government of United States.
© 2021.

ECONOMIC POLICY RESEARC CENTER (EPRC) კოვიდ-19 გამოწვევები და სოციალური პოლიტიკის ვარიანტები საქართველოს მთავრობისთვის ანდრია ურუშაძე BRIEF OVERVIEW AND KEY MESSAGES BRIEF OVERVIEW AND KEY MESSAGES The health care crisis caused by Covid-19 has degraded into economic and social crisis.

The health care crisis caused by Covid-19 has degraded into economic and social crisis.

It has been a year now that the entire world, including Georgia, has lived in the conditions of Covid-19 pandemic.
According to the National Statistics Offi ce of Georgia (Geostat), in the second quarter of 2020, Georgia saw the record high economic decline of 13.2%.

With epidemiological situation worsening and lockdown announced, the situation is expected to further deteriorate by the end of the year.

Unemployment and poverty have been increasing on a monthly basis.
Against the decrease in budget revenues, a signifi cant increase is seen in the costs of virus prevention and treatment of infected people as well as in social protection programs.

This adds to the fi scal burden caused by the pandemic.
It is vitally important for the country to choose not a lockdown-dependent response strategy to the pandemic, It is vitally important for the country to choose not a lockdown-dependent response strategy to the pandemic, but a risk-based strategy that will envisage minimal and targeted restrictions of economic activities.

but a risk-based strategy that will envisage minimal and targeted restrictions of economic activities.
The crisis caused by the pandemic cannot be dealt with by separate health care, social protection or economic development measures.

An effective national response strategy must contain all the three dimensions.

Therefore, an epidemiological context of the country shall be taken into account when considering social policy options and public health intervention for controlling the virus and preventing its spread must be planned in light of health care, economic and social risks.
For at least two months – December and January, Georgia will have to continue living in the conditions of halted economy and severely restricted social life (suspended public transport, closed schools, theaters, gyms, winter resorts).

The lack of alternative to the lockdown-dependent approach threatens economic welfare of the majority of population and weakens the government’s capacity to overcome economic and social consequences of the pandemic in the setting of halted economy and decreased revenues.
A choice of social policy in the period of pandemic must be made in light of those barriers that exist in A choice of social policy in the period of pandemic must be made in light of those barriers that exist in the delivery of health care, social and education services in the country.

At present, almost all countries the delivery of health care, social and education services in the country.
implement anti-crisis social programs1 to protect population against impoverishment and unemployment, to enable business overcome the situation with the least possible losses.

The analysis of those programs2 shows that the consequences of pandemic-induced economic and human crisis will be especially devas- tating for population of mid- and low-income countries.
These countries lack monetary and administrative resources of the size that are available for the developed countries; nor are their health care and social pro- tection systems as developed and resilient as in the developed countries.

During crises, budgets of social protection programs of mid- and low-income countries heavily depend on international aid, or loans taken by governments, not on their own budget revenues and reserve funds.
The labor market structure does not allow to intensively apply remote management models and online services.

Underdeveloped information in- frastructure and limited access to the Internet create additional barriers to the introduction of remote forms of education and other services, especially in rural areas.
To curb poverty that has increased in the period of pandemic, it is necessary to prioritize social protection To curb poverty that has increased in the period of pandemic, it is necessary to prioritize social protection programs, target the assistance and strengthen the existing social protection system.

programs, target the assistance and strengthen the existing social protection system.
A call “Leaving no one behind” is the central idea in the attainment of Sustainable Development Goals and this idea shall become a basis of planning and implementing social programs in the period of pandemic.

In the conditions of scarce 1 IMF.

Policy responces to covid-19.

Policy tracker.

See at: https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19 2 Ibid.
3 financial and administrative resources,3 assistance shall be focused on the needs of those people who are primarily exposed to poverty and famine, unemployment and social exclusion.

Groups whose life and health are most threatened during the pandemic are also highly vulnerable to social risks.
Socially disadvantaged families, elderly citizens, people with chronic diseases, children and women, internally displaced persons will all sustain a higher damage than other groups as a result of worsened socio-economic situation.
Existing social protection systems, as a rule, cannot entirely cover the needy population of the country and many people remain beyond social safety net; this is especially true for poor families with poor social skills, families that lack permanent housing, and people employed in informal sec- tor.

It is important for the government and population of Georgia to take these circumstances into account when choosing health care and social policy options during the pandemic.

3 Durán Valverde, Fabio.


& Pacheco-Jiménez, José F. & Muzaffar, Taneem.

& Elizondo-Barboza, Hazel., 2020.

"Financing gaps in social protec- tion global estimates and strategies for developing countries in light of the COVID-19 crisis and beyond," ILO Working Papers.

ILO.

4 LIFE OR ECONOMY?

SOCIAL CONSEQUENCES OF 1.

1.

LIFE OR ECONOMY?


SOCIAL CONSEQUENCES OF LOCKDOWN-DEPENDENT STRATEGY AND ITS LOCKDOWN-DEPENDENT STRATEGY AND ITS ALTERNATIVE ALTERNATIVE A Covid-19 vaccine (more than one) has already passed all tests.

This has raised hopes that the spread of infection will be stopped and people will return to face-mask-free life.

However, the Covid-19 pandemic is not a crisis of public health care alone.
If the spread of Covid-19, according to the most pessimistic scenarios, is stopped by the end of the next year, the economic and social consequences of the pandemic will require much more time and efforts to overcome.

According to Geostat data, the indicator of Georgia’s economic growth comprised -13.2% in the second quar- ter of 2020.

Since the epidemiological situation worsened in the autumn and the country reentered lockdown, the situation will probably further deteriorate.
A survey of the population conducted after the end of the first lockdown in May 2020 showed4 that the reality that emerged because of coronavirus led to the decrease in income and to impoverishment of a significant segment of households: compared to pre-coronavirus period, income decreased for around a quarter of the population (23%), remained the same for 65% and increased for 3%.
Income mainly decreased in low-income households (income groups: GEL 0 – GEL 300 and GEL 301- GEL 500), which indicates that the socio-eco- nomic crisis hit the poor most severely (the poor became poorer).

According to the results of a survey of public attitudes, conducted by the International Republican Institute (IRI)5 on 2 August, 40% of the population said that their economic situation worsened a lot while 42% said that it somewhat worsened.
According to the same survey, the economic situation was very good for only 2% of the respondents.

On 23 November Georgia reentered the lockdown.

For the second time, the country came to face a dilemma – economy or health?

True, the choice between the life and the economic collapse is not a solution.

Halted economy is no less dangerous for the health and life of population than the spread of viral infection.

Thou- sands of people get poorer, lose jobs and income.
We must keep in mind that there is an obvious interrelation between socioeconomic situation and health.

Social welfare is one of dimensions affecting human health.

Poverty is a significant determinant of all those indicators that measure health of a nation and effectiveness of a health care system, which, among others, include morbidity and life expectancy indicators.

The richer the country, the higher the chance of its citizen to live a longer and higher-quality life.
Furthermore, data shows that an annual economic growth of around 0.3%-0.4% of a country increases life expectancy by 10%.

Restrictions imposed by the lockdown pose a serious problem to a smooth operation of health care sector too.

Restriction of movement of public transport and public mobility, unexpected and long interruption in planned and other non-emergency medical services inflict serious damage on physical and mental health.
Studies show a notable increase in complications of, and deaths from, somatic diseases under the imposed restric- tions, also increase in mother and child mortality rates.6 4 The study is conducted in agreement with the Ministry of Displaced Person from Occupied Territories, Labour, Health and Social Affairs, the World Health Organization Regional Office for Europe, World Health Organization Country Office Georgia and the UNICEF Office for Georgia with financial support from WHO/Europe, the European Union and UKaid.
https://www.unicef.org/georgia/media/4736/file/COVID-19-Study- Analytical-Report-1-st-2nd-and-3rd-waves-Eng.pdf 5 The survey was conducted between 4 June and 2 July 2020, on behalf of the International Republican Institute by the Baltic Surveys/The Gallup Organization.

https://www.facebook.com/IRI.Georgia/photos/?tab=album&album_id=3381558945214377 6 WHO.

2020.

COVID-19 could reverse decades of progress toward eliminating preventable child deaths, agencies warn.
5 Until the vaccine becomes available and while specific medication for treating Covid-19 does not exist, a common goal of strategies implemented today is to stop the spread of the infection.

Implemented strategies7 may be nominally divided into two categories.

The first category employs lockdown and restriction of public mobility as the main tool in preventing the spread of disease.

The most vivid example of this approach is China.


The second category implies slowing down the spread of infection by mass testing, detecting cases of disease and isolating infected persons.

In this case, restrictions are viewed only as a supporting means.

The example of this approach is South Korea or, among European countries, Slovakia.
It should be noted that in the first months of the pandemic, the majority of countries viewed lockdown to be the only approach and this is fully understandable because there was very little information and knowledge about the new virus.

The ne- cessity to lock down was also prompted by the capacity of local health care systems: shortage of diagnostic tests and lab capacities, of intensive beds, qualified personnel.
The choice also depended on the speed of the response of a public health care system to the threat of the pandemic.

Cases of the Central Europe (Italy, France, Spain) and the USA prove that delay in response and waste of time often deprived governments of any other choice but lockdown and forced them to impose severe restrictions to contain a fast increase in the number of infected people.
The introduction of such lockdown in Georgia in the spring of 2020 brought about a good result, leaving Geor- gia in the “green zone” by the number of both infected and deceased persons.

However, once the restrictions were lifted, everything changed.

Since September, the number of cases soared.

Due to fast deterioration of epidemiological situation in Georgia, the European Union, on 22 October, removed Georgia from the list of safe countries.
In November, Georgia was the leader in the world by the increase in new cases per million people.

These developments proved over again that the lockdown cannot decrease the overall morbidity and mortality rates in the long term and that the lockdown may be only used for temporary easing the burden of the health care system.8 Chart Chart 1.1.
Cases of Covid-19 morbidity and mortality in Georgia in January-November 2020 Source: https://www.worldometers.info/coronavirus/country/georgia/ Source: This is one of the reasons why the World Health organization (WHO) calls on governments to use lockdown not as the main strategy to control the infection, but as a last resort and for the shortest possible duration.

It is important to avoid lockdown’s extremely damaging effect on the economy, human welfare, unemploy- ment and impoverishment.

7 IMF.

2020.
7 IMF.

2020.

Policy responces to covid-19.

https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19 8 Lasha Dolidze, 2020.

Covid-19 epidemic.

Is response commensurate to the threat?

Tbilisi, EPRC.

https://eprc.ge/uploads/Covid-Publica- tion-ENG.pdf 6 According to the WHO, governments “buy time” at the cost of “locking down” the economy to strengthen health care system and prepare for an inevitable crisis.
As special representative of the WHO, David Nabar- ro, explains, governments: “buy time to reorganize, regroup, rebalance their resources.” This is especially important for governments of poor countries.
A report of the United Nations Development Program (UNDP)9 says that lockdown is often the only solution to those countries where health care systems cannot otherwise stop and control the spread of the disease: they lack capacities for conducting tests, sufficient number of intensive care beds, equipment and special- ists to isolate and treat large numbers of patients within a short time span.
However, this solution comes at a very high economic price and low-income countries are especially recommended to implement targeted strategies for effective control of the infection.

The only strategy acceptable for all countries and especially poor countries like Georgia should be the con- trol of infection and containment of its spread with minimal economic expenses, with the balance between health and economic interests maintained.
When we cite examples of France, England or the USA to justify the lockdown, we should also take into account the circumstances that necessitated the imposition of those restrictions, the economic cost of the restrictions and also, financial means that are available to these coun- tries to assist their population and business.

One should also take into account that it will be much more difficult for low- and mid-income countries to rebound to even pre-Covid-19 indicators.
The period of recovery will take much longer and will be way harder for society to go through.

A strategy chosen at such times must be less damaging to the economy and well balanced.

An alternative to a lockdown-dependent strategy is the implementation of a risk-based strategy which will use the capacities of the health care system in a timely manner and to the fullest extent and minimize the need for “locking down” everything.
Society must be actively involved in the development and implementa- tion of a strategic plan.

An alternative strategy that will minimize the necessity of lockdowns and spare us from dire social-eco- nomic consequences rests on three main principles: informing and educating population; testing, timely detecting and isolating infected people; controlling clusters.

1.

Informing and educating population 1.


Informing and educating population Educating public about pandemic is a significant element of successful response to the pandemic.

It is the behavior of individuals that most strongly influence spread of the virus.

Everyone should understand the importance of social distancing and personal hygiene.

This includes national minority groups as well as re- ligious and political organizations.
Effective communication during the pandemic requires a higher amount of attention, resources and engagement.

2.

Testing, timely detecting and isolating infected people 2.

Testing, timely detecting and isolating infected people A real alternative to locking healthy people in their homes and preventing them from movement and activity is to make tests available for everyone, and timely detect and isolate infected people.

3.

Taking care of high-risk groups and controlling clusters 3.
Taking care of high-risk groups and controlling clusters Bearing in mind peculiarities of Covid-19, high-risk groups and clusters are necessary to monitor closely in order to observe safety.

Such places must be medical institutions, residential homes for elderly people, penitentiary institutions… any place where the risk of catching and spreading infection is higher than usual.

9 Sachs, J., Schmidt-Traub, G., Kroll, C., Lafortune, G., Fuller, G., Woelm, F. 2020.
The Sustainable Development Goals and COVID-19.

Sus- tainable Development Report 2020.

Cambridge: Cambridge University Press.

7 Clear and open assessment indicators are of utmost importance for effective management of the process.

Delivery of comprehensive and objective information to population is crucial for the involvement of society and achievement of results through implemented public measures.
A solution to the created situation is a better planning and coordination, education and involvement of citizens, enhancement of public health care systems, proactive control of the spread of infection, use of restrictions as a last resort and in a selective manner, and not living in a “lockdown entry-exit” regime that inflicts great harm on human welfare and health, in general.

8 SOCIAL PROTECTION PROGRAMS IN THE 2.

2.


SOCIAL PROTECTION PROGRAMS IN THE CONDITIONS OF COVID-19 PANDEMIC CONDITIONS OF COVID-19 PANDEMIC In parallel to imposed restrictions, the majority of countries stepped up their social protection programs which were aimed to compensate for economic damage sustained by households and organizations.
In the conditions of a pandemic, an objective of social protection is to curb unemployment and rising poverty, on the one hand, and on the other hand, to support economic recovery in the shortest possible timeframe.

Emergency social protection programs in the conditions of a pandemic may be divided into three main categories: 1.

Assistance to population affected by pandemic; 1.


Assistance to population affected by pandemic; Aim of these programs is to protect vulnerable population against fast and significant deterioration of social and economic conditions.

This type of assistance may be in the form of cash as well as in-kind.

2.

Partial compensation of citizens for lost income; 2.
Partial compensation of citizens for lost income; This envisages a financial compensation for those who lost jobs and income, including informal sector workers, as a result of restrictions imposed because of the pandemic.

This is especially important for those countries which lack unemployment insurance mechanisms.

This category also includes social protection programs designed to provide alternative/temporary employment to those who lost jobs.

3.

Assistance to organizations; 3.


Assistance to organizations; To improve economic results of a pandemic, it is necessary to support business in order to enable them to maintain as many employees as possible and after the restrictions are lifted, to resume their activities in the shortest possible time.

The analysis of social protection programs implemented by various countries shows that there is a huge similarity between the types as well as objectives of the programs.
Statements of governments of both rich and poor countries are very much similar as well as their desire, to not leave anyone without attention and support.

However, the difference is stark between economic capacities of these countries.

It is impossible for many to deliver on these promises in full and with their own financial resources.

Difference is also stark between the degree of preparedness of health care systems to ensure fast and safe implementation of social protection programs.

2.1.

2.1.
2.1.

2.1.

COSTS OF PANDEMIC-RELATED SOCIAL PROGRAMS COSTS OF PANDEMIC-RELATED SOCIAL PROGRAMS A joint study10 conducted by international agencies, which examines the data on 1179 programs, provided by 212 countries and territories, has shown that during the first eight months of 2020, the total expenditure of social protection programs doubled and reached USD 790 billion.
This is almost one percent of the global 10 Ugo Gentilini* , Mohamed Almenfi* , Pamela Dale**, Robert Palacios* , Harish Natarajan* , Guillermo Alfonso Galicia Rabadan* , Yuko Okamu- ra* , John Blomquist* , Miglena Abels* , Gustavo Demarco* and Indhira SantosSocial.

2020.

Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures “Living paper” version.

WB.

Unicef.

9 GDP (USD 87,7 trillion in 2019).

This expenditure comprises approximately USD 243 per capita.
Difference between per capita costs spent by rich and poor countries is significant, in the range between USD 4 and USD 695.

This indicator comprises USD 57 in upper middle-income countries (see Table #1).

Table 1.

Table 1.
Social costs during the period of pandemic in selected 119 countries Social Social assistance assistance Social Social insurance insurance Labor Labor market market Countries Expenditure Countries Expenditure Countries Expenditure 13 29 36 1,586,985,461 55,171,282,058 - 4 - 1,050,126,211 - 5 - 1,359,579,479 71,940,840,189 13 97,284,846,378 10 7,918,236,395 Cost Cost $ per $ per capita capita $/per capita 4 28 57 28 511,561,177,859 9 21,365,039,265 10 20,628,207,639 695 Low income countries LIC11 Lower middle-income countries LMIC Upper middle-income countries UMIC Higher income countries HIC Source: WB.
UNICEF.

2020 (1) Source: During this period, the volume of financial transfers of social nature more than doubled (217%).

2.2.

2.2.

TYPES, DURATION AND REACH OF SOCIAL ASSISTANCE PROGRAMS TYPES, DURATION AND REACH OF SOCIAL ASSISTANCE PROGRAMS A large part of social assistance programs is either one-off (29%) or short-term – three months long, on the average.

It is worth to note that in often cases, programs were extended as the epidemiological situation worsened and the restrictions were reimposed.
As for the reach, social assistance programs has reached the total of around 2 billion people; by countries, on the average, this indicator comprises 17% of the population.

More than half of social protection programs (724 measures) is in the form of social assistance (62%).

More than half of the assistance (51%) was issued in the form of cash transfers through safety nets existing in countries, which indicates about the focus of these programs on vulnerable groups of the population.
Only six monetary assistance programs were universal.

Some 22% of social assistance was in kind – food prod- ucts, vouchers, school feeding.

In 101 countries the assistance was implemented in the form of subsidies for utilities fees and/or postponement/waiver of financial, including leasing and bank obligations.
11 In low-income countries, GPD per capita is less than USD 1 025, in lower middle-income countries GPD per capita ranges from USD 1 026 to USD 4 035, in upper middle-income countries it ranges from USD 1 USD 4 035 to USD 12 476, while in high income countries it is above USD 12 476.

In Georgia GDP per capita is 4 696.2 (2019).

10 PANDEMIC-RELATED ANTI-CRISIS PLAN AND 3.

3.

PANDEMIC-RELATED ANTI-CRISIS PLAN AND SOCIAL PROTECTION PROGRAMS IN GEORGIA SOCIAL PROTECTION PROGRAMS IN GEORGIA 3.1.

3.1.
3.1.

SOCIAL PROTECTION PROGRAMS SOCIAL PROTECTION PROGRAMS During the pandemic, one of focal points in the response to social and economic challenges for develop- ing economies is the mobilization of local and international resources.

According to the data of Ministry of Finances of Georgia, USD 1,9 billion was mobilized, based on the agreement achieved with international partners, for the compensation of the results of the pandemic.

This is around USD 514 per capita.


A large amount of this sum is either a grant assistance from international organizations, or a soft loan.

Chart 1.

Chart 1.
Amounts received from international partners Asian Development Bank (ADB) Kreditanstalt für Wiederau�au (KfW) Agence Française de Développement (AFD) European Union (EU) Interna�onal Monetary Fund (IMF) World Bank (WB) Asian Infrastructure Investment Bank (AIIB) European Investment Bank (EIB) 0 100 200 300 400 500 Source: Ministry of Finance of Georgia Source: According to a report12 published by the Finance Ministry of Georgia, from the received amount, GEL 420 million was spent on the prevention of virus and treatment of infected people, GEL 1,2 billion was spent on assistance of citizens, while GEL 1,7 billion was spent on the support to business.
The total amount mobi- lized for the aim of social protection made up GEL 3,32 billion, which is approximately USD 270 per capita.

This indicator notably exceeds a corresponding indicator of upper middle-income countries (USD 57).

More than GEL 1,2 billion was allocated for aiding citizens, of which GEL 373 million was social assistance cash transfer, GEL 433 million was utilities fees subsidy, GEL 355 million was spent on compensating lost income, while GEL 17 million was used to finance education.
12 Report of the Ministry of Finance of Georgia, 2020. https://mof.ge/images/File/MOFPPT_AllSlides_Draft.pptx 11 Chart 2.

Chart 2.

Programs for the prevention of virus and treatment of infected people Preve�on of Spread of Virus Quaran�ne Measures Enhancement of Health Care Sector Source: Ministry of Finance of Georgia Source: 0 50 100 150 200 250 Chart 3.

Chart 3.
Chart 3.

Citizen assistance programs Subsidy for U�li�es Fees Compensa�on of Hired Employees Compensa�on of Self-Employed People Assistance to Various Social Groups Assistance to Under-18 Children Financing of Higher Educa�on of Students Financing of Restric�ons Imposed in November Source: Ministry of Finance of Georgia Source: 0 100 200 300 400 500 More than GEL 1,6 billion was mobilized for the assistance of business.

Chart 4.
Chart 4. Business support programs Income TAX Tourism Sector Interest Cost Loan Guarantee Fund Construc�on Sector Agriculture GEL Liquidity in Banks 0 100 200 300 400 500 600 Source: Ministry of Finance of Georgia Source: The analysis of social protection measures and the budget, planned and implemented by the government of Georgia during the pandemic, shows that a large amount of money is allocated for stimulating the eco- 12 nomic activity and is being used for subsidizing separate sectors of the economy.
Considering extended lockdowns, it is hard to say at this stage how suffice is this spending and to what degree will it contribute to the maintenance of jobs or fast recovery of the economy to previous levels after the lockdown.

The first months revealed that the government assistance has benefitted large companies to a greater degree than small and medium size business whose representatives has been lacking access to that assis- tance (for example, flour subsidy program).
It has also become apparent that the subsidization of prices on staple food products, implemented in the spring, did not produce a long-term effect and it would have been more effective to give that assistance directly to citizens.

It is conspicuous that the amount allocated for the support of various vulnerable social groups (along with the assistance to families with children) comprises a mere 11% of the total amount.
It should also be taken into consideration that social monetary assistance is issued only to those citizens who are on the list of social as- sistance beneficiaries, which does not ensure the reach and support of the entire poor population.

According to a study13 conducted by UNICEF, 76% of people in the lowest-income decile (the poorest tenth of house- holds) received one of the forms of social assistance (be it targeted social assistance or other type of allow- ance, including a disability pension).
In the second decile, only 39% of people received any sort of assistance.

A problem in receiving assistance may be faced by households whose registration is, for whatever reason, cancelled or suspended; poor families with poor social skills; families that do not have permanent housing.
A decision taken by the government to increase the number of households receiving monetary assistance up to 100 000 scores may be seen as a partial solution to this problem; though many families may still be left without support.

One of the solutions could be to step up the activity of local self-governments and have local social services identify households that have been left without assistance and mete out to them financial assistance from local resources.
In order to curb increased poverty during the pandemic, social protection programs must be prioritized and targeted assistance and existing social system must be enhanced.

3.2.

3.2.
3.2.

3.2.

INDEXATION OF PENSIONS AND ACCESS TO PENSION ACCOUNTS INDEXATION OF PENSIONS AND ACCESS TO PENSION ACCOUNTS To compensate for increased prices and improve access to medical services, many governments applied mechanisms of temporary increase in pensions or indexation mechanisms.14 Furthermore, a need has arisen to introduce non-cash electronic forms of pension payments and delivery of pension services online.
According to the anti-crisis plan of Georgia, the government plans to introduce pension indexation from January 2021, whereby a pension of every pensioner will increase by at lease inflation rate, which means that the rise in prices will no longer affect the actual size of pension; pensions of people aged over 70 years will be further increased by 80% of real economic growth, which means that an annual increase in pensions will be higher than the increase in inflation rate; irrespective of inflation and economic growth indicators, the increase in pension will not be less than GEL 20 while no less than GEL 25 for those aged above 70.
One should also take into account that according to 2019 data, every second pensioner living in Georgia owes to a bank.

On that bank loan they pay the highest interest rate than any other group of population – 31%, and have to leave the third of the pension, GEL 65, to the bank during months and often, years.15 One of the forms of support to people of retirement age in Georgia during the period of Covid-19 pandemic could be a co-financing, decrease or postponement of interest on loans secured by pensions.
13 UNICEF, 2019.

A detailed analysis of targeted social assistance and child poverty and simulations of the poverty-reducing effects of social transfers.

14 Organisation for Economic Co-operation and Development (OECD).

2020.

“Retirement Savings in Time of COVID-19.” Paris.

15 RFE/RL.
15 RFE/RL.

www.radiotavisupleba.ge/a/%E1%83%91%E1%83%90%E1%83%9C%E1%83%99%E1%83%98%E1%83%A1-%E1%83%9B%E 1%83%9D%E1%83%95%E1%83%90%E1%83%9A%E1%83%94-417-%E1%83%90%E1%83%97%E1%83%90%E1%83%A1%E1%83%98- %E1%83%9E%E1%83%94%E1%83%9C%E1%83%A1%E1%83%98%E1%83%9D%E1%83%9C%E1%83%94%E1%83%A0 %E1%83%98/30138030.html 13 3.3.

3.3.
3.3.

RIGHT TO USE PENSION SAVINGS FOR CITIZENS OF NON-RETIREMENT AGE RIGHT TO USE PENSION SAVINGS FOR CITIZENS OF NON-RETIREMENT AGE Since 1 January 2019, Georgia introduced a savings pension scheme.

Every employee who was 40 years old or under by 6 August of 2018 shall pay a pension contribution.

Furthermore, every employer and the state shall pay a pension contribution for every employee of that category.
Every employee pays a pension contribution in the amount of 2% of their income before tax while an employer and the state, each, transfer the same amount, i.e.

2% of employee’s income before tax, for every employee to individual pension ac- counts of employees.

According to the data of the Pension Fund, as of 13 November 2020, the value of the Pension Fund com- prised GEL 1 billion 77 million, while the number of registered pensions is more than 1 million 86 thousand.
Save in exception cases, pension savings may be withdrawn only after a person becomes of a retirement age which is 65 years in case of men and 60 in case of women.

Moreover, any beneficiary may request, in cases specified in the law, the withdrawal of the entire saving at once.
By now, as many as 650 benefi- ciaries have done so including 244 beneficiaries on the ground of becoming of the retirement age, one on the ground of moving abroad, 241 on the ground of disability, and 74 on the bases of the right of inheritor.

During the period of the pandemic several countries took a decision concerning private pension contribu- tions, which envisaged changes to pension contribution payment scheme and gave the right to citizens affected by the pandemic to use part of the pension savings.
The countries that took such decisions include Australia, Belgium, Canada, Colombia, Denmark, Estonia, Finland, France, Iceland, Peru, Portugal, Slo- vakia, Spain, UK, USA.

Such option was not considered in Georgia.


Bearing in mind experience of other countries, during the pandemic such options could be a temporary suspension of payment of pension con- tribution for all participants to the scheme, or only for employers; also, granting the right to withdraw from personal pension accounts part of the saving (for example, up to 30%) to those citizens who lost jobs and income.

14 CONCLUSIONS AND RECOMMENDATIONS 4.

4.


CONCLUSIONS AND RECOMMENDATIONS In the conditions of Covid-19 pandemic, the health and life of citizens of Georgia face a threat of fast in- crease in differential number as well as a fast increase in unemployment and poverty.
It is vitally important for Georgia to opt not for lockdown-dependent strategy of response to the pandemic, but a risk-based strat- egy that will envisage minimal restriction of economic activities and will consider pandemic-related risks as well as social and economic risks.

1.
1.

An alternative to lockdown in a current situation is not an uncontrolled spread of the virus and con- sequently, more cases of disease or deaths, but the enhancement of the public health care system and timely, effective and targeted measures for the prevention of the disease.

A pandemic-related crisis management model shall consider measures that are necessary for the prevention of both the disease and the lockdown; 2.
In the conditions of scarce financial resources resulting from the pandemic,16 it is necessary to plan social assistance programs primarily in light of needs and interests of those people who are more exposed to the threats of poverty and famine, unemployment and social exclusion.

“Leaving no one behind” is the central idea in the attainment of Sustainable Development Goals and this idea shall become a basis for planning and implementing social programs in the period of pandemic; 3.
Georgia has examples of successful surveys of population welfare.17 Drawing on this experience, it is advisable to conduct a survey of economic and social vulnerability of population, which will iden- tify social and economic results of the pandemic for the most vulnerable groups; also, the barriers that stand in the way of receiving social and health care services.
It is necessary to have a targeted and needs-oriented social policy in order to spend existing resources more effectively and to curb increasing poverty.

Results of the study must become one of the bases for the preparation of a long- term strategy for strengthening responsiveness of social protection system to crises; 4.
Among short-term objectives could be the increase in the role of local self-governments for iden- tifying and supporting household that have been left beyond centrally administered programs and assistance; 5.

Pension indexation may prove insufficient or untimely for those people who have already withdrawn their pensions and have to repay them back at a very high interest rate.

According to 2019 data, there are 417 thousand such pensioners, that is almost every second pensioner.
One of the forms of supporting the retirement age may be a co-financing, decrease or postponement of interest on loans secured by pensions.

16 Durán Valverde, Fabio.

& Pacheco-Jiménez, José F. & Muzaffar, Taneem.

& Elizondo-Barboza, Hazel., 2020.

"Financing gaps in social pro- tection global estimates and strategies for developing countries in light of the COVID-19 crisis and beyond," ILO Working Papers .

ILO.

17 UNICEF has been conducting Welfare Monitoring Surveys since 2009.
Most recent survey was conducted in July-August 2017.

UNDP also has experience in conducting economic and social vulnerability survey (2012).

15 LITERATURE 5.

5.

LITERATURE 1.

Ugo Gentilini (WB), Mohamed Almenfi (WB) and Pamela Dale (UNICEF).

Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures.

s.l.

: WB, sept. 2020.

2.

The Sustainable Development Goals and COVID-19.

Sustainable Development Report.


Sachs, J., Schmidt-Traub, G., Kroll, C., Lafortune, G., Fuller, G., Woelm, F. Cambridge : Cambridge University Press., 2020.

3.

Monitoring knowledge, risk perceptions, preventive behaviours, and public trust in the current coro- navirus outbreak in Georgia.

UNICEF, WHO.

Tbilisi: WHO.

UNICEF, 2020 წლის.

4.

COVID-19 in Georgia.

Report of National Center for Disease Control & Public Health.

Fourth revi- sion.

NCDC Georgia.

Tbilisi: NCDC, 2020.

5.

IMF.


Policy responces to covid-19.

Policy tracker.

IMF.

[Internet] 18 December 2020. https://www.

imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19.

6.

Durán Valverde, Fabio.

& Pacheco-Jiménez, José F. & Muzaffar, Taneem.

& Elizondo-Barboza, Hazel.

Financing gaps in social protection global estimates and strategies for developing countries in light of the COVID-19 crisis and beyond.

s.l.

: ILO, 2020.

7.

Gassmann, F. et al.


Economic and Social Vulnerability in Georgia.

2012.

Tbilisi : UNDP, 2012.

8.

UNDP.

Covid-19 and human development: Assessing the Crisis, Envisioning the Recovery.

s.l.

: UNDP, 2020.

9.

Dolidze, Lasha.

2020.

Covid-19 epidemic.

Is response commensurate to the threat?

Tbilisi : Eco- nomic Policy Research Center, 2020.

10.

Guruli, Irina.

COVID-19 in Georgia Impact and Implications.

Tbilisi : EPRC, 2020.

11.

Governmetn of Georgia.


Report on measures implemented by the goevrnmetn fo Georgia in re- sponse to Covid-19.

Tbilisi : 2020, June.

12. WHO.

Covid-19 Strategy Update www.who.int.

[Internet] April 2020. https://www.who.int/emergen- cies/diseases/novel-coronavirus-2019/strategies-and-plans.

13.

ILO.

Financing gaps in social protection:Global estimates and strategies for developing countries in light of the COVID-19 crisis and beyond.

s.l.

: ILO, 2020.

14.


Social Protection Interagency Cooperation Board SPIAC-B.

A Joint Statement on the Role of Social Protection in Responding to the COVID-19 Pandemic.

s.l.

: SPIAC-B, 2020.

15.

UNICEF.

Georgia social protection system readiness assessment.

s.l.

: UNICEF, 2020.

16.

Ministry of Finance of Georgia.

Report of the Ministry of Finance of Georgia 2020.

s.l.

: Ministry of Finance of Georgia, 2020.

17.

OECD.

Covid-19: Protecting people and societies.

s.l.

: OECD, 2020.
s.l.

: OECD, 2020.

16 Tbilisi 2021