Kathmandu. Social insurance plays an important role in the social security system in the Asia Pacific region. In 2009, 59 per cent of government social security spending in the sector was spent on social insurance. As a result, it became the leading social security system. However, many people in the region, especially those working in the informal sector, are deprived of the benefits of social insurance.
Social insurance is a contributory security system. To which employees contribute a portion of their income. Which is used to deal with risks such as disease, disability, workplace injury, unemployment, and old age care. It operates under the public sector and aims to ensure social security for people.
In many Asian countries, people working in the informal sector do not get the benefits of social insurance. Because they are not employed permanently and their income is temporary. These workers cannot join social insurance schemes. As a result, they are deprived of insurance benefits. This creates inequality in insurance benefits in society.
The biggest part of social insurance is pension. Which accounts for 65 percent of the total social insurance cost. However, while established workers are getting this benefit, people working in the informal sector are largely deprived of this benefit. About 10-15 percent of workers in developing countries of Asia are covered in pension schemes. Which is a big challenge.
Health insurance is the second largest sector of social insurance. Which accounts for 13 percent of the expenditure but provides security to 35 percent of the population. This insurance system is working as a strong initiative to ensure the health security of the people and through its expansion it is possible to ensure the benefits of many people.
Maternity leave, provident withdrawal and separation benefits are used as part of other social insurance. However, the lack of unemployment benefits is clearly seen in developing countries. China, Thailand and Vietnam, Indonesia and the Philippines have offered some protections for employees through future funds. However, these are limited.
Women get less benefits from social insurance. However, some benefits such as maternity leave are designed directly for them. Their access to social insurance is limited as most women work in the informal sector and are therefore deprived of benefits. Governments need to do more to address this disparity.
The management of social insurance is very effective in developed countries such as Japan, South Korea, Singapore and Malaysia. In Japan, health insurance covers a total of 127 million people in the country. Which makes it one of the largest and most successful health insurance systems in the world. South Korea’s national health insurance system is a successful example of this.
In 2009, China launched a new rural pension scheme. Which provides minimum income security for the elderly and encourages savings. The social pension scheme for urban workers was launched in 2011. Which created new opportunities for china’s informal sector workers.
The social insurance system in the Asia Pacific region is still incomplete in many ways and faces many challenges. However, government steps and new initiatives are helping to make these measures more effective and inclusive. It is important to ensure social insurance benefits and provide additional protection to women workers, especially for workers working in the informal sector.
The Asia Pacific social insurance system is emerging as a strong security system for the people of the region. However, the problem of discrimination in social insurance benefits and deprivation of informal sector workers still exists.
If more initiatives and plans are made by the government and other relevant agencies, it will be possible to make this system more secure, equitable and effective. Source: Asian Development Bank
