Transcript Document

Selwyn Jehoma
Social Security
» History
Industrialization
Impact
Most men became employees
of firms – with social security
coverage as from late 19th
century
This grew significantly after 1st
and 2nd World Wars
• Social Security is money, goods, services
policies that any modern and decent society
makes available to its citizens in order to
ensure they make ends meet.
• Social Assistance is a grant or an in-kind
benefit paid for by the government from taxes
• Social Insurance is a grant paid for from
savings into a fund by those who have work
employed
• Private provision has grown in the absence of
state provision or when state scales down
• Parallel to social security, many AngloAmerican countries developed employee
benefits schemes:
– Savings and risk pooling schemes existed as
far back as the 1850
– South Africa’s employee benefit schemes date
back to date back to 1890’s for occupational
injuries
– Unemployment, maternity and sickness
benefits came later in the 20’s
• Proper social security lagged behind
Child benefits
family benefits
Pension from
state and/or
contributions
Disability or sickness benefits
when work is interrupted
complete school
workers
contribute: social
insurance
Where are we?
12,000,000
10,000,000
8,000,000
6,000,000
Old age pension and
Disability
CSG growth
GDP share of all
grants- from 1.5% to
3.4%
10,336,000
Partial coverage of
pensions and others
4,000,000
2,000,000
150,366
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011*
2012*
Is this affordable? 5 million tax payers?
Future trends in Child Support Grant
What should be done in SA?
Middle and
high income
people
Pillar 3
Improve Regulation
Low and middle
income
Pillar 2: National Social Security Fund
Oblige everyone to contribute towards:
A national pension system, UIF, Accident
and work injuries and diseases and health
care
Pillar 1: Social assistance for the poor
7/20/2015
Social Security and Retirement
Reform IMC/IDTT
10
Implications
1. Not a threat but a diversification of risk
2. For current financial arrangement:
– Provident funds will decline
– Reduce financial flow
3. New challenges:
– Depending on your place in the market, space for
brokers will be reduced
– Companies must innovate to compete for skills
– Design new ways to become employer of choice
Implications
1. A new balance will have to be found in the best
interest of all
–
–
–
–
–
having more income security for
A more inclusive society,
a reduction of poverty,
a reduction in equality, a more fair society,
a more certain future for all