Govt’s Social Security Plan
When Prime Minister KP Sharma Oli announced the new social security scheme for the working class people amid much fanfare in the capital last week, he sounded extremely proud and confident about changing the fate of many laborers who has been working in dire conditions. However, with an estimated 6.7 million incurred in posters, advertisements and programs for mass publicity, the plan has also received a great deal of criticism for being extravagant.
Reminiscing the notion of the 1994 UML government to launch senior citizen social security plan, the Prime Minister sang the glory of his mother party for floating this concept two decades ago. Marking Nov 27, 2018 as the first social security day, he posited the new scheme as the government’s sincere effort to promote the welfare of its citizens refuting growing public fury of his leadership for effective delivery. With the introduction of this scheme, the government has reiterated that a new era has begun in Nepal in which the dignity of the labor is valued and welfare of the vulnerable groups of the society is promoted.
Originating in 1933 for the first time in the United States, American president Roosevelt floated the concept of social security aimed at ensuring minimum protection of the vulnerable and marginalised groups of the society for survival. Amid growing fear of a revolution of a working class, the social security scheme was implemented although the parliament rejected the bill. Since then, this concept has come a long way with different countries of the world adopting their own model of social security.
Having said that, only 45 per cent of the global population is covered by at least one social benefit and the remaining 55 per cent are left unprotected according to ILO’s World Social Protection Report 2017/19. Further showing that only 29 per cent of the global population enjoys comprehensive social security, the report calls for immediate actions to bring the remaining population under the ambit of a broader social security plan.
The contribution-based social security scheme provides four different types of facilities to the formal sector workers- private or public: medical treatment, health and maternity security; accident and disability security; dependent family security and old age security. Under this scheme, the employer will deduct 11 per cent of the basic salary of workers for the social security fund and add an extra 20 per cent from the organisation making it a total of 31 per cent. Even if the workers switch from one organisation to another, the fund will not be discontinued but only the name of the contributing employer will be replaced.
Out of the total 31 per cent, 1 per cent for medical treatment, 1.40 per cent for accident and disability, 0.27 per cent for disability security and the highest 28.33 per cent for old age security has been allocated. While the laborers can immediately claim the money in case of accidents, he/she must have worked for 6 months to get the benefit of medical treatment.
The recently introduced social security scheme upholds the spirit of the constitution which defines Nepal as a socialism-oriented, federal democratic republican state. Moreover, the scheme has also embraced the underlying idea of fundamental rights particularly ‘Labor Rights’ (Article 34), ‘Right to Social Justice’ (Article 42) and ‘Right to social security’ (Article 43) as enshrined in the constitution. However, the major challenge lies in terms of accommodating unorganised workers who keep on switching work for their survival. With the government’s inability to bring such workers who occupy a major share of the current labor market under this plan, the wider usefulness of this scheme has become questionable.
Equally pertinent is the issue of employer’s willingness to implement the plan. Since the plan requires both employers and employees to contribute in the fund for reaping benefits for the workers, the benefits won’t accrue if any of the two parties become reluctant to play their respective roles for the maintenance of the fund.
In the absence of a strong monitoring mechanism turning this plan into action looks like an uphill task for the government. Amid the government’s failure to fully implement the much-hyped minimum basic salary plan introduced recently including important provisions of the labor act, it is very difficult to believe that the current scheme will come into full operation.
Nevertheless, the pro-active government can definitely ensure the effective implementation of the plan. In order to make this scheme more encompassing, the government also needs to bring in professionals like doctors, engineers, teachers, journalists among others. Continuous monitoring and evaluation of the private sector is extremely important to check whether the scheme has really been put into action.
No less significant is the need to raise massive public awareness about the plan. The central government can entrust local level government to conduct orientation about this scheme to the local workers including the daily wage labourers. Disseminating complete and unambiguous information about the scheme through national public media will also help to reach out to wider the audience.