Expanding frontiers of social security

THE widening gap between available jobs and those seeking employment have resulted in discontented population, especially in the developing countries.

This worrying trend has presented governments with formidable social challenge as the task of redistributing common wealth that accommodates the vulnerable groups is becoming increasingly difficult. Hence, most governments now see adoption of social security as a credible shortcut to ameliorate the social pressure pile on socially disadvantaged persons.

The International Association of Social Security (ISSA) defined social security as any programme of social protection established by legislation, or any other mandatory arrangement, that provides individuals with a degree of income security when faced with the contingencies of old age, survivorship, incapacity, disability, unemployment or rearing children.  It may also offer access to curative or preventive medical care.

Accordingly, social security can include social insurance programmes, social assistance programmes, universal programmes, mutual benefit schemes, national provident funds, and other arrangements including market-oriented approaches that, in accordance with national law or practice, form part of a country’s social security system.

According to available estimates, around 50 per cent of the global population has access to some form of social security, while only 20 per cent enjoy adequate social security coverage.

The need to extend coverage is therefore a key challenge for social security organizations in all regions. However this can only be done while also addressing wider policy issues, including the demographic ageing of populations, evolving family structures, the impacts of economic globalization, the growth of informal labour markets, and epidemiological and environmental developments.

ISSA hinted that the European experience shows that efficient economies and efficient social security systems can grow hand-in-hand, and that the latter is not a brake on the former. Clearly, all countries must develop their social security systems according to their own socio-economic needs and circumstances. Nonetheless, on the basis of European experience, the message for developing countries is a clear one: effective and efficient social security systems are key to long-term social and economic development.

Indeed, Nigeria could be said to have adopted this paradigm as it has introduced the health insurance scheme, contributory pension scheme, and employees’ compensation scheme. In its drive to ensure expansion of social security safety net in the country, government has approved the additional packages to the employee compensation scheme currently implemented by the Nigeria Social Insurance Trust Fund (NSITF).

Speaking on the advent of social security scheme in Nigeria, the Managing Director of NSITF, Munir Abubakar, who lauded President Goodluck Jonathan for breaking the ice, said government before now, associated the scheme to wastage of resources.

His words: “Although in the past, the issue of funding social security had always scared governments, thinking that investment in this area is wasteful; the present administration of President Goodluck Jonathan has realized that social security is not a social cost but an investment in people and the State, with attendant benefits like poverty reduction or eradication or prevention, improved quality of work and life, national social cohesion and peace, nation building and state security. The Administration has therefore made a paradigm shift away from the age-long belief that social security is costly and not affordable and has taken a bold step in enacting the amendment to NSITF Act of 1993, which now covers such areas as unemployment benefits and social pension or assistance to the aged, children and other vulnerable groups.”

Abubakar also stressed that the extended mandate of the NSITF as contained in the new amendment to its Act, which is awaiting President Jonathan’s assent, is aimed at extending social protection to more vulnerable groups.

“The newly enacted amendment to the original NSITF Act of 1993 makes adequate provisions for non–contributory schemes like unemployment benefits, assistance to the aged, children and other vulnerable members of the society. Obviously, this new enactment, which is awaiting Mr. President’s assent, is aimed at focusing on these areas,” he explained.

The NSITF boss highlighted that the future of social security in Nigeria is bright going by the cooperation of the organized private sector in the implementation of employees compensation scheme.

He added: “It is gratifying to note that we have made appreciable progress in the buy-in secured from the organized private sector employers within the past two years of implementing the scheme. As at December 2014, a total of 23,482 employers have been registered from that sector. This translates to coverage of about 11 Million employees in the private sector.”

The NSITF helmsman hinted that efforts are on-going to collaborate with the labour movement, social  partners employer bodies, and relevant non-governmental organizations for the popularization of the scheme.

He added that under the NSITF–NECA Safe Workplace Intervention Project, incentives were given to employers who comply with nationally drawn occupational safety and health standards. The incentives include the award of ambulances and several infrastructural Aids for the maintenance of safe working environment. This is helping greatly to achieve a vital aspect of the Scheme – prevention of workplace accidents/diseases through improvement in quality of health and safety and provision of accident prevention infrastructure in contributing companies.

“Therefore, we embarked on aggressive public enlightenment programmes to raise the level of public dialogue and awareness about the ECS. Interactive sessions with stakeholders (NECA, NLC and other groups and associations) are on-going in the six Geo-Political Zones of Nigeria. The fora have been expanded to include stakeholders from the States and Local Governments. Courtesy visits to win the support and buy-in of State Governors have been undertaken to some State Governors, while visits to others are being scheduled. All of these activities are aimed at ensuring critical stakeholders are aware of their roles in the implementation journey,” Abubakar explained.

In her reaction to the added mandate of the NSITF, the Board Chairman, Mrs. Ngozi Olejeme said deliberate efforts were made to highlight the goals of Social Security, saying, “in doing so, we note also that social security is not a social cost but an affordable investment in people and the State. Therefore, the goals of social security in any environment are to guarantee the following: eradication, or reduction or prevention of poverty and vulnerability; improvement/standardization of quality of work and life; assurance of national social cohesion and peace; creating and diverting human, natural and economic resources towards nation building; assurance of global or state security.”

She insisted that the extension of mandate indicates the determination of President Goodluck Jonathan to drive enlarged social security that includes the aged, children, unemployed youths and other vulnerable members in the society.

She added: “I am confident that Nigeria will not only achieve the aforementioned goals, but will surpass them when we aggregate the expected impact of the multi–pillar social protection programmes being offered to Nigerians through various Schemes. When full implementation of the new law by NSITF commences, average Nigerian will be adequately catered for as a child, youth, middle aged or aged as the law makes copious provisions for child benefits, unemployment benefits and old age benefits for the vulnerable.”

While lauding government for the initiative, former President of Trade Union Congress (TUC), Peter Esele, urged for the gathering of relevant statistics in order to ensure sustainable implementation of the enlarged mandate.

He explained: “For me, this additional mandate is a welcome development because it will further widen the window of benefit to more vulnerable groups. But we need to ask ourselves basic questions about what is needed to ensure sustainability. For instance, we must ask ourselves where  the resources will come from? Who are the beneficiaries? What qualifies one to be beneficiary? We must ensure that such a scheme is implemented in a manner that everybody will contribute to the growth of the society and that we do not end up create a section of society that is parasitic. 

We must have statistics on many unemployed persons we have; how many elderlies need social protection and how many of them still have means of generating one form of income or the other. Care must also be taken to ensure that the scheme has a trickledown effect where state government and local government councils participate so that majority of vulnerable groups can benefit. Such a programme must be taken to the grassroots because most people who will need it are in the rural areas where there are no pensions and education at the lowest ebb. People earning any kind of income cannot be a part of the scheme including retirees who are on pension. So, to my mind, government must do a lot of planning in order to ensure the success of the additional responsibility to the implementation of the Employees Compensation Scheme.”

The ILO insists that while many countries are making cuts to public expenditure, most middle-income countries are boldly expanding their social protection systems, with immediate impacts on reducing poverty and inequalities, thereby contributing to their domestic demand-led growth strategies. 

A study on the global social security trend by the ILO entitled ‘Social protection global policy trends 2010-2015’ noted that the worldwide trends towards fiscal consolidation can be expected to aggravate the employment crisis and inequality trends.

It also noted that in developing countries that are not investing in social protection, adjustment measures are expected to negatively affect millions of households that have been coping with fewer and lower-paying job opportunities, higher food and fuel costs, and reduced access to public services since the crisis began.

The Director of the ILO Social Protection Department, Isabel Ortiz, submitted: “In many countries, policy responses to the global crisis have been taken behind closed doors, as technocratic solutions with limited or no consultation. This has often resulted in a lack of public ownership, civil unrest and adverse socio-economic impacts. Governments, employers, workers and civil society must come together in a national dialogue to ensure a socially-responsible recovery aimed at achieving inclusive growth, social protection and social justice,” she added.

The ILO Social Protection Floors Recommendation, 2012 (No. 202) reflects a consensus among governments and employers’ and workers’ organizations from 185 countries on the need to extend social security. The rollout of social protection floors has also been endorsed by the G20 and the United Nations.

Social security schemes Nigeria presently implements include National Health Insurance Scheme (NHIS), Contributory Pension Scheme, National Housing Fund (NHF) and mortgage financing, Employees’ Compensation Act (ECA) and the newly introduced provisions for non–contributory schemes like unemployment benefits, assistance to the aged, children and other vulnerable groups.