The coronavirus pandemic has once again highlighted the lack of social protection in Peru and Latin America. 75% of workers work in the informal sector and do not have access to social security, health care or a pension. On December 31st, 2019, a law was passed stating that all Peruvians can be treated in the Integrated Health System (SIS). However, this has not yet been implemented.
To confront the coronavirus, the Peruvian government, like many others, is developing a strategy of containment and social isolation, indicating that families should stay home to prevent the spread of the virus and to avoid further infections and deaths.
This measure of isolation does not significantly affect families with a regular income, but it does affect those with only a small or sporadic daily income (75% of the Peruvian population). In order to be successful, the containment strategy must guarantee that families do not leave their homes, but an large percentage of workers who do not have a stable job, or lack a union, will not have an income to support themselves in the coming months. This issue is rarely addressed by the media.
To justify informality, employers argue against the alleged rigidity of the labour market. They are the promoters of this destructive competition that undermines unionisation, minimum wage, collective bargaining, social protection of labour and other rights. The aim, it is said, is to make the labour market more flexible in order to solve the problems of informality, underemployment and high youth unemployment.
Flexibility is letting the market regulate itself. But, as Polanyi (1944) said: "To allow the market mechanism to be the sole director of the fate of human beings and their natural environment, indeed, even of the amount and use of purchasing power, would result in the demolition of society". There is no guarantee that companies operating in deregulated markets will generate good jobs in the sense of stable jobs, with protection for workers and decent wages. The result is precisely the opposite: neoliberal globalisation has made employment more precarious and increased inequality in the living standards and incomes of people in our countries, this is true for countries all over the world.
Social protection is a fundamental policy tool to address social exclusion, inequality and poverty. Social protection programmes have contributed significantly to the achievement of the Millennium Goals and are key tools for the achievement of the Sustainable Development Goals (SDGs) of Agenda2030.
Despite demands made by the ILO, Peru lacks the minimum protection floors that are also demanded by national unions, consumer organisations in compliance with ISO 26,000 (which promotes the recognition of labour rights). In times of a pandemic such as this one, countries without social protection -like Peru- are the most affected.
The impact on the health of families (vulnerable and non-vulnerable) in a coronavirus scenario is very high, since Latin American countries do not have adequate health systems, and little coverage. In the case of Peru, the health system has barely 2% of the beds in intensive care to deal with a possible worsening of the disease's spread.
In our country a way of economic growth was imposed, which does not create jobs or decent income and is based on a destructive concept of competition. That leads to corruption and the granting of tax benefits along with the dismantling of labour standards to attract investments.
The lack of social protection for female and male workers and the precariousness of their living standards, is also an attack on democracy. Without strong trade unions and decent wages, workers lose the ability of citizens to contribute (as a counterbalancing mechanism) to the balance of power, which is precisely one of the characteristics of democratic regimes.
Raúl Luna Rodríguez, GRESP - Peru
Today, some 2 billion people work in the informal economy; more than 1.6 billion of them are affected by the lockdown, particularly in terms of income.
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