|Schemes for social protection|
|Tuesday, 26 July 2011 02:00|
Social security provides a safety net for the employed. Talking Social Security is a new weekly column that will look at social
security issues, such as what social security is, how pensions are calculated and what current pension levels are and why?
In Zimbabwe there are currently two social security schemes, namely the national pension scheme and the Workers' Compensation Fund. These funds provide a degree of financial protection for pensioners and those injured at work respectively.
Social security is primarily a social insurance programme providing financial protection against the economic effects of socially recognised conditions such as poverty, old age, disability and unemployment.
Participation is either compulsory or subsidised heavily enough to ensure that most eligible individuals choose to participate. In most cases contributions come from both employees and employers.
Social protection refers to a set of benefits available from the state, market, civil society and households or a combination of these to an individual or household to reduce multi-dimensional deprivation.
While not everyone enjoys all these forms of protection, every person in formal employment, other than in domestic service, is entitled to the benefits prescribed in the National Pension Fund and Workers' Compensation Fund schemes, provided the stipulated contributions have been paid.
Social security schemes are designed to benefit those who are in employment and their dependents, by providing a degree of protection against the effects of loss of income or ill health.
The major difference between social security and social assistance is that social security benefits are contributions related. Social assistance is provided by the state - in Zimbabwe by the Department of Social Welfare within the Ministry of Labour and Social Welfare - to those who are in need and not covered adequately by social security or any other type of social protection.
Social security is most easily applicable in countries where large numbers of citizens depend on the formal economy for their livelihood, as it is in that context that contributions can most easily be assessed and collected.
In countries where there is a widespread informal economy, formal social security arrangements are generally almost non-existent for the majority of the working population.
Everyone who is in formal employment should be eligible for national pension benefits, as contributions to the pension scheme are compulsory in terms of Zimbabwean law.
Although there are only two social security schemes in Zimbabwe at present, other schemes, such as a national health scheme and maternity benefit scheme, are planned for the future.