UNDP Policy Dialogue on Long-Term Social Protection 11 October 2010

UNDPPolicy Dialogue

on Long-Term Social Protection

11 October 2010Selwyn JehomaDeputy Director General: Comprehensive Social SecurityDepartment of Social Development

Background• The main forces - The inheritance of democratic government

• South Africa chose a broad conceptualization of social protection that:

1. Incorporates developmental strategies and programmes;

2. Provides a coherent framework for integrating existing and proposed social and economic policy interventions. These wider functions and objectives of social protection are better able to address socially and economically embedded problems, new risks and increased vulnerabilities;

3. Creates added potential for integration and links income transfers and private, public and community sector interventions.

SOCIAL PROTECTION FRAMEWORK

Three Pillar

Constitution of the Republic of South Africa, 1996

Social Assistance Act, 2004

South Africa Social Security Agency Act

Free Basic Services:Housing, Water, Electricity, sanitation, etc.

National Health Act

SA Schools Act

Compensation for Occupational Injuries & DiseasesAct, 1993

Road Accident Fund Act, 1996

Unemployment Insurance Fund Act, 2001

Medical Schemes Act, 1998

Medical Schemes Act, 1998

Pension Fund Act 1956

The Social Protection FrameworkApplication Key components

Income poverty Universal/eligibility criteria

Child support grant (0-6 years)State Old Age grantIncome support and Expanded Public Works

Capability poverty Universal/ Eligibility criteria

Free and adequate publicly-provided healthcareFree primary and secondary educationFree water and sanitation (lifelineFree electricity (lifelineAccessible and affordable public transportAccess to affordable and adequate housing

Asset Poverty Universal/ Eligibility Access to productive and income generating assets such as land and creditAccess to social assets such as community infrastructure

Special needs Eligibility criteria Reformed disability grantCompensation for work related injuriesCompensation for Road Accidents

Defining social protection

• World Bank: “Portfolio of strategies & arrangements ranging from risk reduction, avoidance or prevention”

• ILO, DFID, others: as income transfers through social insurance, social assistance to protect employed citizens.

• Definitions proposed are similar.

• The traditional concepts of social protection do not always reflect the realities of the developing world.

• Comprehensive social protection for South Africa seeks to provide the basic means for all people living in the country to effectively participate and advance in social and economic life, and in turn to contribute to social and economic development

BASIC SERVICES• Inclusionary Housing Policy create housing

opportunities for low cost housing.• Free water supply is for those who cannot afford • Free electricity• Sanitation provided• Healthcare• Education• Land (re)distribution

SOCIAL ASSISTANCE SCHEME

Social Assistance is provided in the form of – old age grant, – disability grant, – war veterans grant, – care dependency grant, – foster care grant, – child support grant, – grant-in-aid and social relief of distress

SOCIAL INSURANCE SCHEMES• Social insurance is provided to protect employees and their

dependents, through insurance, against contingencies which interrupt income.

• These schemes are contributory for both employers and employees.

• The contributions are wage-related and the employees and the employers are mandated by law/ bargaining council arrangements in terms of sector of employment

• Social insurance covers contingencies such as pensions or provident funds, medical benefits, maternity benefits, illness, disability, unemployment, employment injury benefits, family benefits and survivor’s benefits.

Strategic Challenges

• Social Assistance • Social Insurance• Education• Housing• Water and Sanitation

How are we planning to

move towards a Comprehensive Social

Security System?

Partial Social Security Universal Social Security

REFORM: SOCIAL SECURITY

- Universally available basic benefit for all citizens and specified classes of legal residents

– Contributory environment over-and-above pillar 1, characterized by strong mechanisms to ensure social solidarity:

• Income and Risk-based cross-subsidies and Mandatory participation

– Discretionary social security over-and-above minimum levels regarded as essential

Pillar 1:

Pillar 2:

Pillar 3:

Concluding remarks• South Africa’s social assistance programme has been

expanding at an unprecedented rate, from covering just 2,7 million people in 1994 to over 12,5 million people today.

• Its total expenditure makes up 3,4% of GDP and is the second biggest expenditure item of government’s budget

• Much work remains to be done in respect of the second pillar to expand coverage for employment related social security, including retirement provisions, health insurance, unemployment insurance, etc.

• Backlogs in basic services a moving target

Merci

Gracias

Obrigado

Asante sana

Thank You