IMF engagement solves long term social security

Engagement on macro-critical SSN [Social Safety Net] issues in the surveillance context should be driven by an integrated assessment of the potential impact on macroeconomic stability. An issue or policy would be considered critical to bilateral surveillance and warrant IMF engagement if it affects or has the potential to affect domestic (for example, growth, inflation, fiscal sustainability), external, or global stability.15 This assessment should be risk-based, and the depth and breadth of engagement need to balance the level of risk and macro-criticality with the urgency of the issues and internal resources available. Staff should also routinely assess whether economic and social developments, new events (for example, pandemics and disasters), and material changes to the SSN system (affecting adequacy, efficiency, and sustainability of the system) may raise new policy concerns that warrant engagement. SSN analyses should not be limited to short-term considerations and may require a long-term approach. This would help take into account the long-term impact of SSN spending and reforms on, for example, macroeconomic performance, human capital formation, and income distribution. Certain structural developments (for example, population aging and labor market developments) may also require a long-term view about the effect on and the role of SSN programs.