Heads of the BRICS countries pose prior to the BRICS summit in New Delhi on March 29.
by gaya business times
Despite
different cultures, demographics, economic situations and societal institutions
and structures, the development and rapid extension of social security coverage
in the BRICS countries (Brazil, Russian Federation, India, China and South
Africa) has been impressive. Because the successes have been achieved in often
challenging environments large informal and rural sectors with limited
financial capacity for contributions, increasing population mobility, and
fragmented administrative structures to name just three – the experiences from
these five countries provide useful pointers for other countries aiming to
extend and maintain coverage.
Accounting
for close to 40 per cent of the world’s population, the BRICS countries have
averaged 8 per cent GDP growth over the last ten years. This has created a
strong foundation for the extension of coverage efforts witnessed over the
decade. There are both common features and significant differences in the
environment in which social security is operating in the five countries. For
example, while all the five countries are ageing, the rate at which this is
happening varies considerably. In addition, although the coverage of rural
populations and the informal sector is challenging for all, the size of these
sectors varies considerably across the BRICS.
Reflecting
the differing context for coverage efforts, successes have been varied.
However, a number of common themes underlying these successes can be
identified: There have been great strides made in the coverage of rural
populations. Effective approaches require a combination of an appropriate
benefit and financing structure (simple benefits and contribution rates) with
improvements in access (for example, the use of mobile offices, extending
e-services or working with other stakeholders).The administration and
management of social security has improved through the application of modern
management techniques, the effective use of ICT (e.g. the introduction of
social security pension identity cards) and the training and development of
personnel.
Social
security pension administrations have proved flexible in adapting procedures
and processes to the needs and expectations of different sectors of the
population. Simplifying adhesion, changing benefit structures, reflecting local
realities and facilitating contribution and benefit payments have all been
observed. Fragmentation of delivery and benefit provision is being addressed by
better coordination, leading to a reduction in the duplication of benefits and
improved delivery of services. It has also allowed administrations to better
respond to the challenges of increased migration.
A
more proactive and preventive approach can be observed in some countries. For
example, linking unemployment insurance with employment policies (such as
retraining) or an increased focus on rehabilitation after accidents to reduce
future medical costs and facilitate return to work. The communicating of social
security benefits to the population has improved through a series of
initiatives such as the use of ICT and working with groups representing certain
workers. This has reinforced other measures to extend coverage to new groups.
With specific country examples in three areas are
for Expanding front-line networks and services is Brazil is focusing
on opening new local offices in targeted municipalities while Russian
Federation for using of mobile front offices and India for catering small-sized
enterprises and casual workers
On the extending coverage to rural populations and
the informal sector India is focusing on unemployment
insurance and health coverage while China on health insurance and pension
benefits and South Africa on extending coverage to non-nationals and wider
eligibility for family benefits
They also plan using ICT effectively to extend
coverage for instance India is immediately planning to
use smart cards for rural workers while Brazil is improving registration
through coordination across different information systems, informing
beneficiaries of their rights
And
China through improving smart cards with financial functions while Russian
Federation for expanding e-services and coordination between state and
municipal authorities. This should be as learning model or corner stone and a
big challenge to the East Africa Community Member States on how they should
come out with strategies on how to extend coverage to rural and urban
populations and to the informal sector in particular where about of 95% of the east
Africa population has not been coverage with the existing formal social
security pension schemes in the region.
There
have been a long await gaps in the social security pension industry in the
region and in particular in terms of improving registration and informing
insured members and other related beneficiaries on their obligations, rights
and their benefits offered by these pension schemes in all in the region area.
Initiatives on how to establish portability system of credits or contributions
from one country to another within the region of East Africa has been started
where by the coverage will extend even to non-nationals to combat the
prevailing evasion of pension contribution and improve the pension rights to
those target groups and their families
Christian Gaya is the
founder of the HakiPensheni Company Limited. Questions from readers will be
answered in future columns. Please send me to gayagmc@yahoo.com, www.HakiPensheni.blogspot.com
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