ILO Social Security Norms and the Upcoming Recommendation

ILO Social Security Norms and the Upcoming Recommendation on the SPF International Labour Office Phnom Penh, Nov. 2011 Helmut Schwarzer 1

ILO Mandate in Social Security v The ILO Mission: Ø Preamble to the ILO Constitution: …to improve conditions of labour, inter alia, through the « prevention of unemployment, …the protection of the worker against sickness, disease, and injury arising out of his employment, the protection of children, young persons and women, provision for old-age and injury » Ø Declaration of Philadelphia 1944: to pursue… « the extension of social security measures to provide a basic income to all in need of such protection and comprehensive medical care » Ø ILC 2001/ILC 2011: Conclusions of the ILC 2001 and 2011 confirmed ILO Mandate in social security. ILC 2001 requested the ILO to launch a global campaign for the extension of social security for all (launched in 2003). International Labour Office

ILO’s main tools for pursuing its mandate…. International Labour Office Ø International Labour Standards Ø Conventions and Recommendations are adopted by the International Labour Conference of the ILO by 2/3 majority of ILO constituents Ø Conventions (188): l Are open for ratification l When ratified: become legal obligations l When not ratified: represent goals for national policy making l Recommendations (199): Not open to ratification l Often accompany a Convention l Technical or policy guidelines Ø

ILO’s up-to-date social security Conventions…. . International Labour Office Ø C. 102 on Social Security (Minimum Standards) C. 121 on Employment Injury Benefits C. 128 on Old-Age, Invalidity and Survivors’ Benefits C. 130 on Medical Care Benefits C. 168 on Unemployment Benefits C. 183 on Maternity Benefits C. 118 on Equality of Treatment in Social Security Ø C. 157 on Maintenance of Migrant Workers Rights Ø Ø Ø

Social Security (Minimum Standards)International Labour Office Convention, 1952 (No. 102)…. . Flagship Convention Ø Ø Convention No. 102 is built upon the basis that there is no right model for social security, and that social security grows and evolves over time. Social security policies should reflect countries’ social and cultural values, their history, their institutions and their level of economic development The Convention therefore does not prescribe a certain behaviour of the member states, it rather fixes a set of minimum objectives built on commonly agreed principles which fixes the social floor for all the ILO member States

Social Security (Minimum Standards) Convention, 1952 (No. 102)…. . International Labour Office Flagship Convention Ø Defines 9 branches of social security Ø Medical care benefit, sickness benefit, unemployment benefit, old-age benefit, employment injury benefits, maternity benefit, family benefit, Invalidity benefit, survivors’ benefit Ø Sets minimum standards for these nine branches Ø Based on basic social security principles

Social Security (Minimum Standards) Convention, 1952 (No. 102)…. . International Labour Office Flagship Convention Ø Sets minimum standards for the nine branches Ø Minimum percentage of personal coverage Ø Minimum level of benefits Ø Maximum qualifying period for the entitlement to benefits Ø Minimum duration of benefits

Social Security (Minimum Standards) International Labour Office Convention, 1952 (No. 102)…. . Convention No. 102 Benefit Sickness Benefit Branches Unemployment Benefit Old-Age Benefit Employment Injury Benefits Short term Disability Survivors’ Family Benefit Conventions Nos. 121, 128, 130, 168, 183 Benefit 45 %1 60 % 45 % 50 % 40 % 45 % 50 % 45 % 3 % or 1, 5 %)2 Maternity Benefit 45 % Invalidity Benefit 40 % Survivors’ Benefit 40 % 60 % 50 % --2/3 of the woman’s previous earnings 50 % 45 %

Social Security (Minimum Standards)International Labour Office Convention, 1952 (No. 102)…. . Flagship Convention Ø Defines basic social security principles Ø Guaranteed, defined benefits Ø Participation of protected persons in administration Ø General responsibility of the Governments for Ø Ø provision of benefits, and proper administration of schemes, e. g. through regular actuarial reviews Ø Collective financing Ø Adjustment of pensions Ø Right of appeal Ø Equality of treatment

Social Security Schemes to comply with Convention No. 102 …. . Ø Social insurance schemes with earnings-related components, or Ø flat rate components, or Ø Combination of both Ø Ø Ø Universal schemes Social assistance schemes Administrations to comply with Convention No. 102 …. . Public social security schemes Ø Private social security schemes, if in compliance with minimum standards and basic principles Ø International Labour Office

Flexibility clauses of Convention No. 102 Ø Offers flexibility, as it takes into account socio-economic levels within different countries by providing for specific temporary exception by covering at least 50% of all employees working at industrial establishments of 20 persons or more Ø Offers possibility of ratifying initially 3 social security branches and ratifying at a later stage, according to the socio-economic situation in the country, further branches, which is regarded as an incentive for extension of social security coverage International Labour Office

International Labour Office Benefits of ratification of Convention No. 102 Ø When Convention No. 102 is ratified, member States will benefit from ILO experience in the field of social protection and from technical assistance, including policy advice and actuarial studies, collection of data, drafting of legislation, etc. Ø Commitment to Convention No. 102 will lead to provide regular and sustainable benefits, thus it will enhance confidence of the insured persons in the scheme and the national social security administration Ø As a result: Social security in ILO member States will be strengthened

Social Security (Minimum Standards) Convention, 1952 (No. 102)…. . Health care, Sickness, Unemployment, Old-Age, Labour Accident, Invalidity, Maternity, Survivor, Family Benefits (9 Branches) Ratification represents a commitment with the quality of social protection in the country. International Labour Office Minimum Standards for the 9 Branches: % individual coverage. , minimum benefit level, max. vesting period, duration of benefits, etc. Flagship Convention on Social Security Ratification by 47 countries Increased Ratification Interest in the World Ratification by Uruguay (2010), Argentina (2011), Brazil (2009) Paraguay and Honduras (request of support), Jordania, Mongolia, Syria (analyzing). CIT 2011 asks for Campaign for Ratification.

Extension of Social Protection and the Bidimensional Approach International «Social Security Staircase» : reference for. Labour Office description and development of social security coverage at national level… high Protection Level Vertical dimension: progressively ensuring higher levels of protection guided by C. 102 and higher-level standards Voluntary insurance under government regulation Higher levels min. C. 102 Social Insurance Beneftis of Guaranteed Levels Floor level low Access to essential health and minimum income security for all low individual/household income high Horizontal dimension: Guaranteeing access to essential health care and minimum income security for all 14

C. 102 strongly supports Social Security Extension in the Vertical Dimension. . . Establishes minimum level of benefits and other conditions Supports the introduction of coverage for new risks International Labour Office Ratification C. 102 as a Guideline for Development of Social Protection … but it doesn’t guarantee the universalization of Social Security to All by itself. Hence the need for a supplementary instrument for the horizontal extension, whose development was approved at ILC 2011.

Horizontal Extension of Coverage: The Social Protection Floor to guarantee basic social rights to everyone in need Basic Transfers • Monetary or in kind; • To guarantee a minimum level of income; and • To allow access to some basic services as education and health care. International Labour Office “A socio-economic floor for a global society” (World Commission on the Social Dimension of Globalization, 2004) Essential Services • Geographic and Finanical Access to Nutrition, Health, Water and Sewage, Education, Housing and other essential Services. 16

The 4 Basic Guarantees of a SPF Basic attention, affordable and available Essential Health Services Benefits for the Aged and Disabled Social Assistance Or Universal Benefits for Families with Children Policies for the Unemployed and Workers without Sufficient Income International Labour Office CCTs, Family Benefits, Maternity Ben. Contents to be defined according to national situation Unempl. Insurance, Public Works, etc. 17

Significance of a possible Recommendation on Social Protection Floors at national and global level International Labour Office National level Global level Contributes to. . . ● reducing poverty and promoting social cohesion and investments in people ● facilitating access to essential goods and services ● promoting productive economic activity and reduction of informality and precariousness ● providing framework for national social protection policies in close coordination with economic, employment and other social policies ● strengthening national dialogue, institutional frameworks and state-building ● achievement of Millennium Development Goals ● promoting rights-based development policies ● building sustainable institutional structures in poor countries ● fostering policy coherence and coordination, and deepening multilateral collaboration 18

Next step: Preparation for the ILC 2012 Afterwards: Work on the Implementation International Labour Office June 2011 August 2011 March 2012 June 2012 ILC Recurrent Discussion on social protection (social security) • Resolution and conclusions • Decision on standardsetting item (single discussion) at ILC 2012 (GB) Law and practice report (white report) Final report (blue report) • Summary of Member responses to questionnaire • Office draft of possible Recommendation ILC standardsetting item (single discussion) • Discussion of amendments • Possible adoption of Recommendation on Social Protection Floors • Summary of law and practice in member States • Questionnaire on possible Recommendation on SPF (deadline: 1 Nov. 2011) Ques tionna ire pleas e subm it befor 1 Nov e 2011 19