Social security: Issues, challenges and prospects

Contents

I

International Labour Conference 89th Session 2001

Report VI

Social security: Issues, challenges and prospects

Sixth item on the agenda

International Labour Office Geneva

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Social security: Issues, challenges and prospects

ISBN 92-2-111961-0 ISSN 0074-6681

First published 2001

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ATA

Contents

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CONTENTS

Pages

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

CHAPTER I. The prospects for social security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

The global context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Social security and decent work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Some key issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Social security, employment and development . . . . . . . . . . . . . . . . . . . . . . . 9 Extending the personal coverage of social protection . . . . . . . . . . . . . . . . . . 10 Contributing to gender equality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Sustainable financing for social protection . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Expanding social dialogue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

The aim of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

CHAPTER II. Social security, employment and development . . . . . . . . . . . . . . . . . . . . . 12

The social and economic impact of social security . . . . . . . . . . . . . . . . . . . . . . . . 12 Social security expenditure, unemployment and growth . . . . . . . . . . . . . . . . 13 Productivity and social stability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Employer contributions and international competitiveness . . . . . . . . . . . . . . 16 Unemployment benefits, unemployment and employment . . . . . . . . . . . . . . 18 Early retirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Unemployment benefits and employment promotion . . . . . . . . . . . . . . . . . . . . . . 19 Relevant international labour standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Industrialized countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Middle-income developing countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Other developing countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Conclusions: Linking social security with employment and development policies 23

CHAPTER III. Extending the personal coverage of social protection . . . . . . . . . . . . . . 25

The right to social security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 The problem of non-coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Policies to achieve the extension of coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

The economic, social and political context . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Strategies for extending social protection . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

IV

Social security: Issues, challenges and prospects

CHAPTER IV. Gender equality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

International labour standards and gender equality . . . . . . . . . . . . . . . . . . . . . . . . 38 The link between social protection and gender . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 The impact of labour market inequalities on different forms of social protection . 39 Measures to grant equality of treatment in social protection and to promote gender

equality through social protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Survivors' pensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Divorce and pension splitting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Pensionable age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Pension credits for persons with caring responsibilities . . . . . . . . . . . . . . . . . 44 Sex-differentiated annuity rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Parental leave and benefits and childcare services . . . . . . . . . . . . . . . . . . . . . 44 Child benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

CHAPTER V. The financing of social security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Global trends in social security expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Social security and its main challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Does social security face an ageing crisis? . . . . . . . . . . . . . . . . . . . . . . . . . . 50 Or does social security face a globalization crisis? . . . . . . . . . . . . . . . . . . . . 50 Has social security reached the limits of its affordability? . . . . . . . . . . . . . . . 51

National financing options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 Financing systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 The indispensable role of government as ultimate financial guarantor . . . . . 57

Globalization and social security financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

CHAPTER VI. Strengthening and expanding social dialogue . . . . . . . . . . . . . . . . . . . . 61

Actors in social protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Family and local solidarity networks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Institutions of civil society . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Enterprises and the commercial market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Government and social security institutions . . . . . . . . . . . . . . . . . . . . . . . . . . 63 The international community . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

Partnerships for social protection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 Enhancing the effectiveness of social security . . . . . . . . . . . . . . . . . . . . . . . . 64 Towards social protection for all . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66

Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69

CHAPTER VII. Implications for future ILO work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

Research and policy development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70

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Providing a normative framework through standard setting . . . . . . . . . . . . . . . . . . 72 Technical cooperation and other means of action . . . . . . . . . . . . . . . . . . . . . . . . . 74

SUGGESTED POINTS FOR DISCUSSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 STATISTICAL ANNEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

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