Egypt, by third world standards, traditionally boasted a relatively generous egalitarian insurance- based welfare regime centered on contribution-based pensions and a universal food subsidy system. The onset of neoliberal reforms since 1991 has been associated with hidden retrenchment in the country’s social policies, marked by dilution of universal subsidy benefits and introduction of new layers of targeted welfare on the production and consumption sides, without overhauling the welfare regime or restructuring its main social security program. What are the dynamics shaping targeting of production-oriented social programs and Conditional Cash Transfer Schemes (CCTs) to particular social groups? And what, if any, are the political influences on their spatial distributional patterns? These questions have not been systematically addressed in authoritarian contexts, like Egypt’s, where there is no institutionalized party machinery and local patronage networks compete under loosely organized party structures. Targeting has continued to figure prominently in World Bank sponsored economic reform agendas, despite the UN’s commitment to universal social protection, “leaving no one behind” as part of the 2030 agenda, and the post-COVID focus on alternative “eco-social contracts,” which makes the research questions particularly pertinent to explore.
In order to analyze the political economy of targeting in Egypt, I focus on the Social Fund’s record of promoting subsidized micro-small and medium enterprises (MSMEs) among limited income groups during the late Mubarak era, as well as new social assistance schemes Takaful and Karama, which were launched under Sisi. I focus on: policy design of targeting maps and official definitions of eligibility criteria, intra-state struggles that served to establish access rules on the ground, as well as the political economy of spatial allocations. The paper draws on: in-depth interviews with ex-officials in charge of the Social Fund, as well as Takaful and Karama, senior decision-makers at the Ministry of Social Solidarity, and specialized technocrats, who were involved in developing targeting mechanisms. I argue that the dominant coalition maintenance imperatives and cultural norms of citizenship shaped targeted social programs, often at the cost of effective pro-poor targeting.