The World Bank has urged Mongolia to reform its welfare system by consolidating different benefits and targeting assistance better in order to improve the efficiency of spending.
In the country, the top 40% of the population by income receive 28% of total welfare transfers, while the poorest 40% receive 56% of welfare, the bank’s Review of Program Design and Beneficiary Profiles of Social Welfare Programs in Mongolia said.
Costs also outstrip the average for other emerging and developing countries. In 2013, Mongolia spent 2.78% of gross domestic product on welfare compared with 1.6% in other emerging and developing countries.
“As an institution devoted to ending extreme poverty, the World Bank strives to understand the drivers of poverty reduction and the factors affecting how prosperity is shared among the population,” said James Anderson, World Bank country manager for Mongolia.
“We hope that this review provides the evidence needed for Mongolia’s leaders to create a more effective and efficient social welfare system, one that puts Mongolia’s poor and vulnerable first.”
The report notes that not all welfare entitlements were linked to need. It urged the Mongolian government to eliminate or reduce benefits for wealthier citizens through means testing.
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