The Role of Zakat in Social Protection in Islamic Developing Countries: A Contributing Instrument

Akmal Salim  Ruhana

doi:10.58968/eii.v1i1.5

Authors

Akmal Salim Ruhana Australia National University (ANU)

DOI:

https://doi.org/10.58968/eii.v1i1.5

Keywords:

Zakat, Social protection, Islamic developing countries, Indonesia

Abstract

Social protection has become an essential agenda in the world countries, either in developed or developing ones. It implements in varied ways and correlates with the 2030 Sustainable Development Goals (SDGs) targets, especially on poverty reduction agenda. Meanwhile, in Islamic developing countries, there is a religious-based concept, so-called zakat, which is conceptually similar with and functionally underpin social protection programs. This paper attests its similarity through a comparative study with Australian social protection concepts. Furthermore, the paper elaborates the potencies of zakat contribution on social protection particularly on addressing the poor and the vulnerable as social protection programs do. In general, the zakat system offers a huge potential of the fund for social protection, but a kind of mismanagement or such inefficiency in zakat institution, as well as political reluctance, can challenge it. This paper recommends a combination or integration between zakat system and the existing social protection system for the better social protection program and on amplifying the effect of these contributing instruments to the needy.

Downloads

Download data is not yet available.

References

Abdelmawla, MA, 2014, ‘The impact of zakat and knowledge on poverty alleviation in Sudan: An empirical investigation (1990-2009)’, Journal of Economic Cooperation and Development, vol. 35, no. 4, pp. 61-84.

Abdullah, N, Derus, AM & Al-Malkawi, HAN 2015, ‘The effectiveness of zakat in alleviating poverty and inequalities: a measurement using a newly developed technique’, Humanomics, vol. 31 no. 3, pp. 314-329.

Abdurraheem, H., and Suraju, SB, 2018, ‘Taming poverty in Nigeria: Language, zakat and national development’, Qudus International Journal of Islamic Studies, vol. 6, issue 1, pp. 1-23.

Azaki, A 2015, ‘Social protection and safety nets in Yemen’, UN World Food Programme.

Barrientos, A, Møller, V, Saboia, J, Lloyd-Sherlock, P & Mase, J 2013, ‘Growing social protection in developing countries: lessons from Brazil and South Africa’, Development Southern Africa, vol. 30, no. 1, pp. 54-68.

Beik, Irfan Syauqi, et al. 2014. “Towards an Establishment of an Efficient and Sound Zakat System: Proposed Core Principles for Effective Zakat Supervision. Paper presented in the Working Group of Zakat Core Principles 2014.

Browne, E 2015, Social protection: topic guide, University of Birmingham, Birmingham.

Calder R and Tancharoen T 2014, ‘Informal social protection: Social relations and cash transfers’, Department of Foreign Affairs and Trade, Australia.

Chapra. MU 1992, ‘Islam and the economic challenge’, Islamic Economics Series, no.17.

Devereux, S & Sabates-Wheeler, R 2004, ‘Transformative social protection’, IDS Working Paper, No. 232, October 2004.

Embong, MR., Taha, R., & Nor, MNM, 2013, ‘Role of zakat to eradicate poverty in Malaysia’, Jurnal Pengurusan, vol. 39, pp. 141-150.

Gamon, AD., and Tagoranao, MS, 2018, ‘Zakat and poverty alleviation in a secular state: The case of Muslim minorities in the Philippines’, Studia Islamika, vol. 25, no.1, pp. 97-134.

Halimatusa'diyah, I 2015, ‘Zakat and social protection: the relationship between socio-religious CSOs and the government in Indonesia’, Journal of Civil Society, vol. 11, no. 1, pp. 79-99.

Hassan, MK., and Khan, JM, 2007, ‘Zakat, external debt and poverty reduction strategy in Bangladesh’, Journal of Economic Cooperation, vol. 28, no.4, pp. 1-38.

International Labor Organization 2017, World Social Protection Report 2017–19, ‘Universal social protection to achieve the Sustainable Development Goals’, International Labour Office, Geneva.

Islamic Banker Association. (2017). Global Islamic Finance Report 2017.

Jawad, R 2014, ‘Social protection in the Arab region: emerging trends and recommendations for future social policy, United Nations Development Program.

Kashif, M., Jamal, KF., and Rehman, MA, 2018, ‘The dynamics of zakat donation experience among Muslims: A phenomenological inquiry’, Journal of Islamic Accounting and Business Research, doi:10.1108/JIABR-01-2016-0006

Mahmud, KT., Hassan, MK., Alam, MF., Sohag, K., and Rafiq, F., 2014, ‘Opinion of the zakat recipients on their food security: A case study on Bangladesh’, International Journal of Islamic and Middle Eastern Finance and Management, vol. 7, issue 3, pp. 333-345.

Nurfalah, I., Rusydiana, A.S., Laila, N., and Cahyono, E.F. 2018, “Early warning to banking crises in the dual financial system in Indonesia: The markov switching approach”, JKAU: Islamic Economics, Vol.31, No.2, pp.133-156.

Olanipekun, WD, Brimah, AN, and Sanusi, HB 2015, ‘The role of zakat as a poverty alleviation strategy and a tool for sustainable development: insights from the perspectives of the holy prophet (PBUH), Arabian Journal of Business and Management Review, vol. 5, no. 3.

Rahman, S., 2015, ‘Zakat on retirement and pension plans’, International Journal of Islamic Middle Eastern Finance and Management, vol. 8, issue 3, pp. 274-290.

Republika 2017, ‘Baznas: potensi zakat di Indonesia sangat besar’ (Baznas: zakat potencies in Indonesia are very high), 29 November 2017, viewed 1 April 2018,

Rusydiana, Aam S, and Salman Al Parisi, 2016. “The efficiency of zakah institution using data envelopment analysis”. Al-Iqtishad: Jurnal Ilmu Ekonomi Syariah, Vol. 8, No. 2, pp.213-226.

Saad, N., and Abdullah, N., 2014, ‘Is zakat capable of alleviating poverty? An analysis of the distribution of zakat fund in Malaysia’, Journal of Islamic Economics, Banking and Finance, vol. 10, no. 1, pp. 69-95.

Shaikh, SA & Ismail, AG 2017, ‘Role of zakat in sustainable development goals’, International Journal of Zakat, vol. 2, no. 2, pp. 1-9.

Shirazi, NS 2014, ‘Integrating zakat and waqf into the poverty reduction strategy of the IDB member countries’, Islamic Economic Studies, vol. 22, no. 1, pp. 79–108.

Shirazi, NS 2006, ‘Providing for the resource shortfall for poverty elimination through the institution of zakat in low-income Muslim countries’, IIUM Journal of Economics and Management, vol. 14, no. 1, pp. 1–27.

Stanton, D 1973, ‘Determining the poverty line’, Social Security Quarterly, Australia.

Uddin, AE, 2016, ‘Through Islamic banks’ zakat house (IBZH): Investment of zakah funds in microfinance to remove poverty in Bangladesh, A new model’, International Journal of Islamic Economics and Finance Studies, vol. 2, no. 1.

Whiteford, P & Angenent, G 2001, ‘The Australian system of social protection—an overview’, Occasional Paper No. 6 Second Edition, Department of Family and Community Services, Canberra.

World Bank 2002, Reducing vulnerability and increasing opportunity social protection in the Middle East and North Africa,

World Bank 2016, Poverty and shared prosperity 2016: taking on inequality, World Bank Group, Washington DC.

Zulkhibri, M 2016, The relevance of conditional cash transfers in developing economy: the case of Muslim countries’, International Journal of Social Economics, vol. 43, no. 12, pp. 1513-1538.