World Bank report: The Bahamas among top unemployment benefit providers in region

A World Bank report has lauded The Bahamas’ level of unemployment benefits during the COVID-19 pandemic, explaining that this country is one of a few in the region to offer unemployment payments to citizens not eligible for the National Insurance Board’s contributory unemployment benefit.

According to the report, titled “Employment in Crisis”, only about one-third of the countries in Latin America and the Caribbean (LAC) offer a national unemployment income support plan.

“Job displacement income support – programs specifically designed to sustain the income and consumption of laid-off workers and their families – in the form of unemployment insurance is, therefore, relatively rare in the region,” the report states.

“Workers with formal employment contracts in Brazil, Chile and Uruguay have access to large risk pools offered by a national unemployment insurance plan (that is, one not specific to a worker’s firm, occupation, or sector). In addition, Argentina, The Bahamas, Barbados, Colombia, Ecuador and the República Bolivariana de Venezuela offer unemployment insurance in the form of contributory risk-pooling plans.”

The report explained that some countries, like The Bahamas, offered unemployment coverage that was effective during the pandemic.

At the start of the pandemic, the government created what is called an unemployment assistance (UEA) program, which was separate from the National Insurance Board’s unemployment benefit.

Since the start of the COVID-19 crisis in The Bahamas, the government has spent $16 million on self-employed, government-funded unemployment assistance programs, $134.6 million on the government-funded unemployment extension program and $97.4 million on the national insurance unemployment benefit.

The report outlines how workers in informal sectors are often in danger of missing out on unemployment coverage in many countries in the region.

“Workers with formal but more precarious contracts may be statutorily excluded from coverage by unemployment income support programs,” the report states.

“And even among formally employed workers with ‘standard’ employment contracts, effective coverage is disappointingly low. Demanding eligibility requirements that fail to reflect the patterns of employment and tenure achieved even by many formal workers impede effective coverage.

“Regulatory and administrative failures often mean that contributions are not received. The transaction costs of securing benefits can be prohibitively high, particularly if the benefits are meager.”

The report reveals that Barbados leads the region in protecting its citizens during the pandemic through unemployment payments, delivering benefits to almost 90 percent of unemployed workers, while The Bahamas captured about 26 percent.

“Beyond the exceptional case of Barbados, whose system delivers benefits to 88 percent of unemployed workers, only in The Bahamas, Chile and Uruguay do national unemployment insurance arrangements appear to provide widespread, effective coverage,” the report states. 

“Outside these three countries, even in the remaining few LAC countries that offer unemployment insurance, coverage remains too low.”

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source https://thenassauguardian.com/world-bank-report-the-bahamas-among-top-unemployment-benefit-providers-in-region/