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Most People Worldwide Have No Social Security

UN Study Finds Most People Worldwide Have No Social Security

New York, Nov 16 2010 1:10PM. Basic social security remains out of reach for most people across the world, especially in poorer countries, despite the crucial role it plays in cushioning people from the consequences of economic crises, according to a United Nations report unveiled today.

The World Social Security Report 2010-2011: Providing coverage in times of crisis and beyond,” prepared by the UN International Labour Organization (ILO), examines the gaps in access to social security programmes in areas such as health care, pensions, social assistance, and unemployment benefits.

It shows that most of the world’s working age population and their families lack effective access to comprehensive social protection systems.

Worldwide, nearly 40 per cent of the working-age population is legally covered by contributory old-age pension schemes, according to the report.

In North America and Europe, this number is nearly double, while in Africa less than one-third of the working-age population is covered even by legislation. In sub-Saharan Africa, only 5 per cent of the working-age population is effectively covered by contributory programmes, while this share is about 20 per cent in Asia, the Middle East and North Africa.

“The current crisis has highlighted the importance of having a minimum set of social security benefits for all in place,” said Juan Somavia, the ILO Director-General. “This is why we advocate for social security and a global social protection floor. This report shows that building adequate social protection for all, drawing on a basic social protection floor, as called for by the ILO Global Jobs Pact, is now more urgent than ever,” he added.

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According to the report, social security plays an important role in times of economic crisis, including the current one, as an “irreplaceable economic, social and political stabilizer” that provides income replacement and helps stabilize aggregate demand, without negatively effecting economic growth.

The study also warns that cutting social security due to fiscal consolidation aimed at coping with increased deficits and public debt “may not only directly affect social security beneficiaries and consequently the standards of living of a large portion of the population, but also, through aggregate demand affects, slow down or significantly delay a full economic recovery.”

Well-designed unemployment schemes, social assistance and public works programmes effectively prevent long-term unemployment and help shorten recovery from economic recession, the report states.

Unemployment insurance schemes were the most common type of social protection measures used to respond to the crisis, it adds, while also noting that only 64 out of 184 countries for which information is available had such unemployment schemes in place when the survey started.

ENDS

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