The Government of Senegal reduced subsidies on electricity, diesel and fuel that will now be allocated to the social sectors to support vulnerable households. Additionally, the Government increased the family security grant by 20 per cent.
Reducing subsidies on petroleum products, electricity and water and reallocating them to social protection programmes was a recommendation from an SP&PFM study on increasing fiscal space for social protection. The study found that 80 per cent of subsidies on petroleum products benefit less than 10 per cent of the population, that 80 per cent of electricity subsidies benefit 22 per cent of the population, and the same for water subsidies.
The SP&PFM project in Senegal supported the policy change through evidence generated in the fiscal space study as well as with capacity-building sessions with national stakeholders to build up their ownership. The adoption of the recommendations also was a result of the SP&PFM country project’s joint advocacy efforts with several development partners, including the World Bank.
The family security grant will, as of the first quarter of 2023, increase from 25,000 CFA franc per quarter to 35,000 CFA franc per quarter. However, for the follow-up to this action and globally for the governance of the social protection sector, there is still a need to establish a reporting, monitoring and accountability system for public spending on social protection. In the absence of such a system, the efforts made could be diluted in the face of mutually exclusive needs for public spending in a single fund.
Learn more about SP&PFM in Senegal