Social security expanded: The stability is ensured

20/06/2024 10:30 AM


During the past decade, ASEAN countries have made progress in extending social protection, with the emergence of statutory schemes in all ASEAN countries. egion a growing consensus that the establishment of social protection floors is a key element of the policy framework to reduce poverty and inequalities and achieve inclusive and sustainable development.

In October 2013, ASEAN Heads of State adopted a Declaration on Strengthening Social Protection, pledging for the completion of social protection floors as a priority to achieve growth with equity. The Regional Framework for Strengthening Social Protection and its Plan of Action, adopted by the ASEAN Heads of State in November 2015, includes among its priorities the extension of social security coverage among informal economy workers, selfemployed and micro, small and medium enterprises (MSME) workers. Building on the achievements of the past two phases of the ILO/Japan Project on Promoting and Building Social Protection in Asia (2011-2013 and 2014-2016), and the solid partnership with ASEAN Member States, a third phase of the Project has been agreed as a component of the ILO’s Global Social Protection Programme. The new phase aims specifically at fostering knowledge, capacity and expertise for extending social security coverage in ASEAN. The project intends to generate better knowledge, understanding and expertise on extension of social security, and stimulate South-South cooperation across ASEAN Member States. The project provides direct support to Indonesia and Viet Nam, and to a certain extend to Myanmar, for increasing social protection coverage. Lessons learnt, experiences and good practices from the three countries will be disseminated across the ASEAN Member States and worldwide.
Strengthening national social security institutions in order to achieve universal coverage and explore customized solutions for specific vulnerable groups (workers from the informal economy, migrant workers) was among the key points listed as top priority areas of actions by the ASEAN members.
How can the extension of coverage be achieved?
Successful examples of the extension of social security coverage to workers in the informal economy have focused on two broad policy approaches:

1. Extension of coverage through contributory mechanisms: In many countries, the extension of social security to larger groups of the population has followed an approach that could be summarized as “extend social protection through formalization”, focusing mainly on extending existing social protection mechanisms (typically social insurance). 

2. Extension of coverage through non-contributory mechanisms: In other countries, the extension of social security to larger groups of the population was pursued through a large-scale extension of non-contributory social protection mechanisms to previously uncovered groups, independently of their employment status, and largely financed through government revenue stemming from taxation, mineral resource revenue or external grants. 

Many of the countries that have successfully extended social protection coverage have combined the two approaches in integrated two-track social protection strategies that pursue the principle of universal protection, while taking into account the contributory capacities of different groups of the population. There is no-one-size-fits-all solution: Rather countries have combined the two approaches to extend social protection to previously uncovered workers, while progressively providing higher levels of protection to as many people as possible.

A number of middle- and low-income countries have significantly extended social protection coverage to those in the informal economy and facilitated their transition to the formal economy through a two-track approach. This includes, for example, the extension of health protection in Thailand (UHC scheme, formerly 30 baht scheme), Argentina (child and maternity benefits) and South Africa (social insurance and large grants programmes). In fact, both approaches, and their combination in an integrated two-track approach, are reflected in both R202 and R204.
in the Americas, Extending and maintaining social security coverage stands out as a perennial challenge for social security administrations.The rapidly  evolving needs of different population groups, especially children, women and the elderly, as well as economic and sociopolitical changes and demographic and technological transitions, have brought about societal transformations with an ever-increasing number of people in need of social security protection.

The region has expanded the scope of its social security coverage to the so-called difficult-to-cover groups – informal workers, domestic workers, migrant workers, among others – through innovative policy design and improved administrative efficacy and efficiency. This, along with economic recovery, improvement in employment and measures to reduce informality, has enabled the fundamental right to social protection to be extended to the greater majority of the region’s population.

The International Labour Office (ILO, 2021b) estimates that 64.3 per cent of the population of the Americas has access to at least one form of social protection benefit, with 57.4 per cent of children receiving childcare benefits and 51.9 per cent of mothers receiving birth-related benefits. A higher proportion (88.1 per cent) of the elderly receive pensions, and 71.8 per cent of persons living with severe disabilities receive social protection benefits. While social assistance programmes cover 36.7 per cent of vulnerable persons, only 16.4 per cent of the unemployed receive social protection benefits.

Extending social protection coverage to workers in the informal economy contributes to facilitating transition from the informal to the formal economy in the short or longer run. The expansion of social insurance mechanisms to larger groups of previously uncovered workers can help to achieve a better financing mix for the social protection system, alleviating pressures on tax-financed social assistance benefits, and ensure sustainability and adequacy of the social protection system in the long run.

PV