Answer
Safety nets are part of a broader poverty reduction strategy interacting with and working alongside of social insurance; health, education, and financial services; the provision of utilities and roads; and other policies aimed at reducing poverty and managing risk.
Safety net programs can play four roles in development policy:-
Safety nets redistribute income to the poorest and most vulnerable, with an immediate impact on poverty and inequality
Safety nets enable households to make productive investments in their future that they may otherwise miss, e.g. education, health, income generating opportunities
Safety nets help households manage risk, at least offsetting harmful coping strategies and at most providing an insurance function which improves livelihood options
Safety nets allow governments to make choices that support efficiency and growth
The safety net as a whole should provide coverage to three rather different groups:-
The chronic poor Even in "good times" these households are poor. They have limited access to income and the instruments to manage risk, and even small reductions in income can have dire consequences for them. The transient poor This group lives near the poverty line, and may fall into poverty when an individual household or the economy as a whole faces hard times. Those with special circumstances Sub-groups of the population for whom general stability and prosperity alone will not be sufficient. Their vulnerability may stem from disability, discrimination due to ethnicity, displacement due to conflict, "social pathologies" of drug and alcohol abuse, domestic violence, or crime. These groups may need special programs to help them attain a sufficient standard of well-being.
Important Clues
Food-based programs such as supplementary feeding programs and food stamps vouchers, and coupons
In-kind transfers such as school supplies and uniforms
Conditional cash transfers
Price subsidies for food, electricity, or public transport
Public works
Fee waivers and exemptions for health care, schooling and utilities