Social security: A new consensus

1 Social security :A new consensusINTERNATIONAL LABOUR OFFICE GENEVA12248_BIT_ang 09:16 Page i1 Copyright International Labour Organization 2001 First published 2001 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copy-right Convention. Nevertheless, short excerpts from them may be reproduced without authorization, oncondition that the source is indicated. For rights of reproduction or translation, application should bemade to the Publications Bureau (Rights and Permissions), International Labour Office, CH-1211 Geneva22, Switzerland. The International Labour Office welcomes such , institutions and other users registered in the United Kingdom with the Copyright LicensingAgency, 90 Tottenham Court Road, London W1T 4LP [Fax: (+44) (0)20 7631 5500; email: the United States with the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923 [Fax: (+1) (978) 750 4470; email: or in other countries with associated Reproduc-tion Rights Organizations, may make photocopies in accordance with the licences issued to them for security : a new consensus Geneva, International Labour Office, 2001 ISBN 92-2-112624-2 The documents included in this volume are also available in French and Spanish on the ILO website designations employed in ILO publications, which are in conformity with United Nations practice,and the presentation of material therein do not imply the expression of any opinion whatsoever on thepart of the International Labour Office concerning the legal status of any country, area or territory or ofits authorities, or concerning the delimitation of its responsibility for opinions expressed in signed articles, studies and other contributions rests solelywith their authors, and publication does not constitute an endorsement by the International Labour Officeof the opinions expressed in them.]]

2 Reference to names of firms and commercial products and processes does not imply their endorsementby the International Labour Office, and any failure to mention a particular firm, commercial product orprocess is not a sign of publications can be obtained through major booksellers or ILO local offices in many countries, or directfrom ILO Publications, International Labour Office, CH-1211 Geneva 22, Switzerland. Catalogues or lists ofnew publications are available free of charge from the above address, or by email: our web site: in SwitzerlandSRO12248_BIT_ang 09:16 Page i2 ContentsPreface ..vResolution and Conclusions concerning Social security ,International Labour Conference, 89th Session, 2001 ..1 RESOLUTION CONCERNING Social security ..1 CONCLUSIONS CONCERNING Social security ..1 Report of the Committee on Social security ,International Labour Conference, 89thSession, 2001 (extracts) ..7 INTRODUCTION ..7 Point 1. Social security and economic development.

3 11 Point 2. Extension of Social security coverage ..1 3 Point 3. Income security for the unemployed and employment ..15 Point 4. Equality between men and women ..1 8 Point 5. Financing of Social security and ageing ..2 3 Point 6. Social dialogue and ILO activities ..2 5 Appendix ..2 9 Social security : Issues, challenges and prospectsReport VI to the International Labour Conference, 89thSession, 2001 ..3 1 INTRODUCTION ..3 prospects for Social security ..3 3 The global context ..3 4 Social security and decent work ..3 8 Some key issues ..4 0 Social security , employment and development ..40 Extending the personal coverage of Social protection ..40 Contributing to gender equality ..4 0 Sustainable financing for Social protection ..41 Expanding Social dialogue ..4 1 The aim of the report ..4 security , employment and development ..4 2 The Social and economic impact of Social security ..42 Social security expenditure, unemployment and growth.

4 43 Productivity and Social stability ..4 5 Employer contributions and international competitiveness ..47 Unemployment benefits, unemployment and employment ..49 Early retirement ..4 9 Unemployment benefits and employment promotion ..50 Relevant international labour standards ..50 Industrialized countries ..5 1 Middle-income developing countries ..52iii12248_BIT_ang 09:16 Page i3 Social security : A NEW CONSENSUSO ther developing countries ..5 3 Conclusion: Linking Social security with employment and development policies ..5 the personal coverage of Social protection ..5 6 The right to Social security ..5 6 The problem of non-coverage ..5 7 Policies to achieve the extension of coverage ..59 The economic, Social and political context ..59 Strategies for extending Social protection ..60 Conclusions ..6 equality ..6 9 International labour standards and gender equality ..70 The link between Social protection and gender.

5 71 The impact of labour market inequalities on different forms of Social protection ..7 1 Measures to grant equality of treatment in Social protection and to promote gender equality through Social protection ..73 Survivors pensions ..7 3 Divorce and pension splitting ..7 5 Pensionable age ..7 5 Pension credits for persons with caring responsibilities ..77 Sex-differentiated annuity rates ..7 7 Parental leave and benefits and childcare services ..78 Child benefit ..7 8 Conclusions ..7 financing of Social security ..8 0 Global trends in Social security expenditure ..8 0 Social security and its main challenges ..8 2 Does Social security face an ageing crisis ? ..83Or does Social security face a globalization crisis ? ..83 Has Social security reached the limits of its affordability ? ..84 National financing options ..8 5 Financing systems ..8 6 The indispensable role of government as ultimate financial guarantor.

6 91 Globalization and Social security financing ..9 2 Conclusions ..9 and expanding Social dialogue ..9 4 Actors in Social protection ..9 4 Family and local solidarity networks ..9 4 Institutions of civil society ..9 5 Enterprises and the commercial market ..95 Government and Social security institutions ..96 The international community ..9 7 Partnerships for Social protection ..9 7 Enhancing the effectiveness of Social security ..97 Towards Social protection for all ..1 0 0 Conclusions ..1 0 for future ILO work ..1 0 4 Research and policy development ..1 0 4 Providing a normative framework through standard setting ..106 Technical cooperation and other means of action ..108 SUGGESTED POINTS FOR DISCUSSION ..110 STATISTICAL ANNEX ..1 1 1iv12248_BIT_ang 09:16 Page i4 RESOLUTION AND CONCLUSIONS CONCERNING Social SECURITYvPrefaceAt its 89th Session in June 2001 the International Labour Conference held, as oneof the main items on its agenda, a general discussion on Social security .

7 The Com-mittee on Social security attracted a high level of interest among delegates, with asmany as 111 Government members, 59 Employer members and 79 Worker mem-bers,1and also numerous advisers and observers. No doubt this reflected the factthat the Committee had before it a number of highly controversial and potentiallydivisive issues. As in other Committees, special efforts were made to prepare the dis-cussions carefully through wide consultation prior to the Conference. This paid offhandsomely, as there was close cooperation, both in the Committee and in the groupresponsible for preparing the draft conclusions, between the Social partners and keygovernmental spokespersons. As a result, the Committee was able to reach rapidagreement on a set of conclusions which reflects a consensus on many of the keyissues and priorities. In particular, it was agreed that: highest priority should go to policies and initiatives to extend Social security tothose who have none; not only is security very important for the well-being of workers, their familiesand the community as a whole, but if properly managed it also enhancesproductivity and supports economic development; the ageing of the population affects both funded and pay-as-you-go pension sys-tems: solutions are to be sought above all through measures to increase employ-ment rates; the Social partners have a strong role to play in the management of Social Committee expressed very high expectations for future ILO action on socialsecurity.

8 It did not make any recommendation about future standards-related activ-ities, but stated that ILO activities on Social security should be based on the relevantILO Social security standards,2the decent work goal and the Declaration of Philadel-phia. It recommended a number of areas on which future ILO research and techni-cal cooperation should focus. And it called for a major campaign on the extensionof Social security and for the ILO to urge governments to give higher priority to are weighted in order to achieve equality of voting strength between the three 09:16 Page i5 Social security : A NEW CONSENSUSviSOCIAL security : A NEW CONSENSUSThis volume contains the Committee s conclusions, large extracts from thereport of the Committee s discussions, and the whole of the report which was pre-pared as a basis for the Committee s ILO does not usually single out the work of individual ILO staff members onreports of this nature. But I think it appropriate, on this occasion, to acknowledgethe important contribution to this work made by Roger Beattie, who tragically diedsuddenly on 24 believe that the outcome of this discussion is a major step forward towards anILO vision of Social security which is in accordance with the needs of our is an essential element of the decent work agenda, Social security a majorinstrument to achieve it.

9 We must continue to build our capabilities, with univer-sality our aim, and can do this now on the foundations of a very successful SomaviaDirector-GeneralAugust 20012In the discussion, particular mention was made of the following Conventions, all of whichhave been categorized as up to date by the ILO Governing Body: the Social security (Minimum Standards) Convention, 1952 (No. 102); the Equality of Treatment ( Social security ) Convention,1962 (No. 118); the Employment Injury Benefits Convention, 1964 [Schedule I amended in 1980](No. 121); the Invalidity, Old-Age and Survivors Benefits Convention, 1967 (No. 128); the MedicalCare and Sickness Benefits Convention, 1969 (No. 130); the Maintenance of Social security RightsConvention, 1982 (No. 157); the Employment Promotion and Protection against UnemploymentConvention, 1988 (No. 168); and the Maternity Protection Convention, 2000 (No. 183).12248_BIT_ang 09:16 Page i6 Resolution and Conclusions concerning socialsecurity, International Labour Conference,89th Session, 2001 Resolution concerning Social securityThe General Conference of the International Labour Organization, meeting in its89th Session, 2001,Having undertaken a general discussion on the basis of Report VI, Socialsecurity: Issues, challenges and prospects;1.

10 Adopts the following conclusions;2. Invites the Governing Body of the International Labour Office:(a) to give due consideration to them in planning future action on Social security ;(b) to request the Director-General to take them into account both whenpreparing the programme and budget for the 2004-05 biennium and in allocatingsuch resources as may be available during the 2002-03 concerning Social security1. In 1944 the Conference recognized the solemn obligation of the Interna-tional Labour Organization to further among the nations of the world programmeswhich will achieve .. the extension of Social security measures to provide a basicincome to all in need of such protection and comprehensive medical care . It is timefor a renewed campaign by the ILO to improve and extend Social security coverageto all those in need of such protection. The Director-General is invited to address theconclusions set out below with the seriousness and urgency they deserve in orderto overcome a fundamental Social injustice affecting hundreds of millions in mem-ber Social security is very important for the well-being of workers, their familiesand the entire community.