GLOBAL COOPERATION NEWSLETTER
December 2014

Wishing all our readers Happy Holidays, a World of Peace and all the best for the coming NewYear!
In this issue:
Featured article:
 "Social protection and social security in the Latin American context" by Leonel Antonio
Flores Sosa
 How to protect the right to social security in a better way? Regional forum in
Dominican Republic.
 Expanding social protection through social dialogue

Useful resources and links



Featured article. Social protection and social security in the Latin American context"
by Leonel Antonio Flores Sosa

Dr. Leonel Antonio Flores Sosa is the Director of the Inter-American Center for Social Security
Studies (CIESS), Mexico. in 2010.
The recent and ongoing government actions in Latin America
and the Caribbean vividly demonstrate that, regardless of thespecific features of their economic growth, most governmentsin the region have added social considerations to domestic
policy development, first of all in order to deal with such social
ills as chronic poverty and structural unemployment. Social
protection policies reflect the preferences and priorities existingat the national level to address inequality, insecurity and thedisempowerment of people. This article seeks to highlight someof the existing national efforts, drawing comparisons andidentifying useful lessons.
Whether employed formally or informally, all workers in society have a common exposure
to contingencies such as sickness, unemployment or old age, which have an impact on thesociety at large. A need to address those contingencies and delay or reduce their negative
consequences is a public concern and the raison d'être of social security. Having or offering
employment without social security falls into the informal sector, and has or does not offer
a decent job.
According to the ILO (2014, p.4), existing laws protect only 28% of the world's population
against unemployment. The asymmetries of that situation become more apparent when
one considers that in Europe 80% of the population are eligible for such protection.
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By the late nineteenth century, before the rise of social insurance in Germany underBismarck, work was a private matter between the employee and the employer. In general,workers faced the risks of life individually or in forms of social organization that were notestablished by law. We should ask whether the approach to social security as a humanright is fulfilled, or if the minimum standards defined in ILO Convention 102, have been
overcome.
Past: the necessity and validity of social security
Historically, the institutions that came to play some sort of social protection role werereligious and charitable, including sororities, and some even promoted domestic solidarity,
which tried to tackle extreme poverty and helplessness. Then, protection systems throughsavings, private insurance, public assistance were started. Likewise, mutualism inaddressing the common problems of workers and their families arose, representing one of
the foundations of the current social security system.
In 1883, the Health Insurance Act was passed in Germany and subsequently laws onaccident insurance and old-age and disability insurance. With the creation of theInternational Labour Organization (ILO) in 1919, an important stage in the evolution ofsocial security and international cooperation began.
In the early days of social insurance, ranging from the late nineteenth century until 1935,
pioneering American countries such as Chile (with the first law on social insurance in1924), Argentina, Brazil, Cuba and Uruguay incorporated pension, retirement, old age anda few disability schemes. In 1927, Canada established its welfare pension insurance.
In the second period, which began in the late thirties, sickness and maternity insurance
branches were included and general schemes were born in Costa Rica, Mexico, Ecuador,Bolivia, Peru, Panama, Paraguay and Venezuela. Benefits and services to wider sectors of
the population were extended. In 1942, the future-oriented document known as theBeveridge Report was formulated in the UK to "attain freedom from poverty by incomemaintenance". In the mid-fifties the social security institutions were created in Central
America and the Caribbean.
In the sixties and seventies such institutions were strengthened as part of the social policy
and economic life of many societies in America. Infrastructure to invest in welfare andreduce asymmetries in society was expanded.
Reforms and their arguments
Since the eighties economic measures and social security reforms that were implemented,
aimed at transferring to the individuals a greater proportion of the costs for their ownprotection. Social investment has been significantly decreased, affecting policies focusing
on poorer sectors and state regulatory capacity.
The Nobel Prize-winning economist Joseph E. Stiglitz, and his co-author Peter R.Orszag intheir well-known paper (1999), examine the myths and fallacies in the discussions aroundreforms at that time, for example:• Social security is a cost that prevents competitive salaries in the international context.
• Need to reduce the government deficit and debt, reducing social security.
• Promises of higher rates of return and growth in saving rates linked to individual savings
accounts.
• Reduced administrative costs, and as unlikely as we may see it today, favourable
consequences for labour force formalization through individual capitalization of pensions.
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The reality after these reforms was a decrease in the coverage of social security and,according to the ILO, many countries adopted adjustment measures such as reduced
subsidies, cuts in wages or their ceilings, and worryingly, "streamlining social protection
benefits" in line with a more restrictive approach, as well as reforms in the pension andhealth. Historical evidence shows that the need to reduce the weight of pensions for thesake of reducing government debt, or limit health insurance to minimum packages havebecome repeatedly seen approaches.
The increasing social inequalities and costs for citizens are the consequences of theseapproaches. For example, the relationship between per capita GDP and out of pocket
health expenditure allows to assess the transfer of the cost of health care to the individual.
In the group of countries with lower GDP, the share of the population with reported out ofpocket spending on health care is 72%, well above the 49% which is the average of Latin
America, and even higher than 23% indicator in the group of countries with the highest
GDP of the region.
Present: social security challenges
Many countries in the region have expanded conditional cash transfer programs. Theseprograms cover 21% of the population in Latin America and 59% living below the povertyline. That means that a debt with much of society is maintained today and, although thecoverage of these programs is more than tripled from 2000, 41% of the poorest population
remains without due regard.
The main challenges facing social security are the exclusion of self-employed workers,
coverage gap between domestic workers and between employees of micro enterprises,
insufficient coverage of the migrant population, lags in the coordination and institutional
integration of programs and responsible entities, and eradicating evasion.
That social security is still not a right that most of the population can enjoy, is also
manifested in the lack of pension coverage of the elderly. By 2011, fewer than 42% of thepopulation over 65 received a pension. The ILO (2014 p. 2) emphasizes that only "27
percent of the working-age population and their families across the globe had access tocomprehensive social security systems”, while 73 percent are partially covered or have nocoverage.
This lack of comprehensive social security is evident in the lack of unemploymentcoverage. In 2010, globally, only 10 countries offered benefits for two thirds of theunemployed. In contrast, 29 only covered a third of the unemployed and 110 nations
lacked social security in this area. The lag also reveals lacking gender equality. Less than
40% of employed women have mandatory maternity cash benefits (ILO, 2014 p.5). Family
and child allowances are completely absent in 75 countries worldwide, while in Western
Europe 2.2.% of GDP is invested in these benefits (ILO, 2014 p.4).
Future: What will happen to social security after 2015?
What will happen to the social security after 2015, which was the target year of theMillennium Development Goals? In the 21st century with globalization and a borderless
economy, free movement of human beings faces the most barriers. We face a world wheremigration is increasing while the protection is insufficient.
The region offers very good experiences with encouraging results, with grounded
optimism, to overcome challenges in various fields of social security. Examples are sobroad and in variety of areas, that it is impossible to cover everything but the following
are very motivating:
Page 3 of 7• The extension of family allowances in Argentina, that along with the Universal Child
Allowance reduced poverty by more than 20%.
• In Brazil, the scope of coverage of the Rural Social Insurance Program is close to 80%of the population of rural sector.
• By 2010 "Rent dignity" which in Bolivia represents a universal old-age pension scheme
reduced the extreme poverty by 6% .
• The Universal Basic Pension in Uruguay, which is available to all persons 65 years andover. The 2007 reform in this country also provides an example of how to extend accessto social security, allowing the incorporation of family dependents if one of the adult
beneficiaries of non-contributory pension system contributes voluntarily.
The comparative analysis of existing national practices provides a necessary policy
feedback, facilitating the inception of future policies. The introduction and development ofvarious tools such as conditional cash transfers and social pensions opened opportunities
for significant reforms by key political actors. While the patterns are complex, and theresults are far from being fully satisfactory, efforts to alleviate poverty have been an
important step to strengthen public and private policies, along with the introduction ofrights-based approaches to policy formulation and implementation.
References:

Peter R. Orszag, Joseph E. Stiglitz. “Rethinking Pension reform: Ten Myths About Social
Security Systems”, 1999, http://www.ssc.wisc.edu/~scholz/Teaching_742/OrszagStiglitz.pdf
World Social Protection Report 2014-2015. Building economic recovery, inclusive
development and social justice, ILO, Geneva, 2014, http://ilo.org/global/research/globalreports/world-social-security-report/2014/lang--en/index.htm
The opinions expressed in the article are those of the author and may not necessarily coincide withthe opinions of the ICSW Management Committee.

How to protect the right to social security in a better way? Regional forum
in Dominican Republic.
Regional forum dedicated to social protection andpolicies to enhance its viability and effectiveness wasconvened by ICSW in close cooperation with DIDA(DIRECCIÓN DE INFORMACIÓN Y DEFENSA DE LOSAFILIADOS A LA SEGURIDAD SOCIAL) in Santo
Domingo on 3-4 December 2014. The Forum brought
together more than 180 participants representing
government structures, as well as representatives ofbusiness, trade unions, civil society organizations
from the region. On the part of ICSW the Forum was addressed by Vice-President of ICSW
Mirtha Sosa Crevoisier, ICSW Regional President for Latin America Nelsida Marmolejos(the host), and Executive Director of the ICSW Sergei Zelenev.
The discussions were wide ranging, and included recommendations on the role played byindependent public representatives such as ombudsmen in protecting the interests of thesociety at large in key social sectors, including social security and health provision. In thiscontext the need of establishing institutions aimed at empowerment of citizens wasunderscored, depending on the national circumstances, and the results that have been
already achieved. The offices of ombudsmen should be professional and work without
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political influences. It was also noted that quality information on existing economic andsocial rights as formally guaranteed by the Constitutions was not always available to thepublic at the national level, and the role that mass media could play in this regard issignificant, but not always adequate in practice. Social security is a universal human rightand should be recognized as such not only in the books but also in practice.
The participants agreed that expanding both vertical and horizontal coverage in healthservices provision should be based on universality, embracing the entire population. The
important role of education and human cadres in the provision of quality health services
was underscored.
The model that envisions universal and comprehensive welfare coverage should beguaranteed to all citizens. The mechanisms for additional financing, along with dedicatedtaxation schemes, should be considered and established when feasible. The effective ways
should be found to protect informal sector workers.
The issues pertinent to the situation of older persons and their rights got substantial
attention at the Forum. The proposed recommendations ranged from a nationwide regularmapping of older persons to have a source of updated information on their socio-economicstatus, enabling more effective planning of social protection schemes, to introducing a 1%
levy on business sector to increase social protection programmes that benefit olderpersons. Intergenerational aspects of support for the elderly were also discussed with theaim of promoting the rights of older persons more vigorously in the family.
Expanding social protection through social dialogue

The Social Protection Floor Initiative got awelcome boost at the international conference
attended by over 90 representatives of national
Economic and Social Councils and other Similar
Institutions (ESC-ISs) who came together on
20-21 November 2014 in Seoul, Republic ofKorea. The outcome of the Conference-- theadopted Declaration emphasized thecommitment of ESC-SIs to expanding social
protection floors for all people, through active
use of social dialogue. The Declaration will serve as a tool for extending national social
protection systems in line with the International Labour Organization’s (ILO)
Recommendation No. 202 and Convention No. 144.
The Declaration aims to reinforce ESC-SIs efforts in bringing together governments,
representative organizations of employers and workers, as well as other relevantorganizations to consult on issues pertaining to the promotion of social protection floors
for all.
As social protection and welfare systems are being reshaped in a large number ofcountries, the need for rights-based approach has become well recognized. Most middleincome and low-income countries are boldly expanding their social protection systems,
providing an ample food for thought and numerous developmental lessons. However, anumber of countries are reforming their social protection systems because of fiscal
consolidation pressures, cutting welfare coverage, reducing benefits and limiting access toquality public services, with significant adverse social impacts.
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Speaking on behalf of the ICSW Prof. Heung Bong Cha, the President of the ICSW North
Asian Region described at length the ICSW approach to promoting social protection,
including its advocacy regarding the Social Protection Floor initiative. Prof. Cha also
provided an overview of national efforts undertaken in the North Asia region in the field ofsocial protection, with particular emphasis on Japan and Republic of Korea, as well as onrecent initiatives carried out in China.
The high-level event was organized by the ILO and the International Association of
Economic and Social Councils and Similar Institutions (AICESIS), in partnership with the
Economic and Social Development Commission of Korea (ESDC).
For more details please go to:
http://www.ilo.org/secsoc/press-and-media-centre/news/WCMS_326950/lang-en/index.htm

Useful resources and links

Integrated social policy. Towards a New Welfare Mix? Rethinking the Role ofthe State, the Market and Civil Society in the Provision of Social Protection andSocial Services. Report V, Beirut, 2014
The present report prepared by UN Economic and Social Commission for Western Asia
explores the prevailing welfare mix in Arab countries, the contribution of different private
sector enterprises and civil society actors to social protection and social services, and theadvantages and difficulties emerging from this situation. It does not aim to provide acomprehensive inventory but rather looks at issues such as education or health-careservices on the basis of examples from selected countries.
The report is available at the following link:
http://www.escwa.un.org/information/publications/edit/upload/E_ESCWA_SDD_13_1_E.
pdf
Geographic Variations in Health Care. What Do We Know and What Can Be
Done to Improve Health System Performance? OECD, 2014
Health care use varies a lot across countries but also within countries. Some of the verylarge geographic variations observed cannot be fully explained by differences in need or
patient preferences. Governments should step up efforts to ensure better use of healthservices. This report provides information on health care use for ten health care activities
and offers a range of approaches to promote the delivery of more appropriate levels ofcare, helping policy makers better understand the issues and challenges aroundgeographic variations in health care provision.
For further details please go to: http://www.oecd-ilibrary.org/social-issues-migrationhealth/geographic-variations-in-health-care_9789264216594-en

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The content of this Global Newsletter may be freely reproduced or cited provided the source isacknowledged. Views do not necessarily represent policies of ICSW.
Newsletter Editor: Sergei Zelenev, Executive Director
Address: ICSW, 5700 Arlington Ave., Bronx, New York, 10471 (US Office)Phone: +1 347-526- 4893,
E-mail: szelenev@icsw.org, icsw@icsw.org
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