26
Social insurance schemes
from law. 50
be noted
Two contrasting aspects of social insurance legislation in Asia may Appendix VIII, which lists the contingencies covered and the year of the basic Countries such as Japan and the USSR adopted social insurance principles over years ago, but the majority of the other countries in the region began to follow the same course only in the 1950s and 1960s. Only Japan has a complete collectively financed social insurance scheme, but a total of 15 countries are shown in Appendix VIII as having one or more contingencies dealt with in this way. Comprehensive schemes are in force in Iran, Taiwan, USSR, and Viet-Nam (North). Twelve countries have employment injury schemes. It is of great interest that the New Zealand legislation which came into force only this year is not confined to employment injury. In an innovative approach to the general problem of accidents, the legislation covers both earners and non-earners in a comprehensive scheme aiming, as far as it is possible, to deal with injuries regardless of their cause. Eight national schemes cover both sickness and maternity; in addition, the Philippines and Viet-Nam (South) provide benefits for one of the contingencies under social insurance and one by means of obligations imposed upon employers through labour legislation.
Medical care under social insurance schemes (such as those in Burma, the Philippines and India) is provided to varying extents and for varying periods, and sometimes is available, at least partially, to the main dependants of insured persons (as in the case of Pakistan). Indonesia has a small voluntary social insurance scheme for sickness and maternity. There are eight comprehensive pension schemes in respect of the contingencies of old age, invalidity and death of the breadwinner, and also India has introduced the Family Pension Scheme designed mainly for the provision of survivors' pensions, and the Invalidity Pension Scheme is now operating in Malaysia. In Viet-Nam (South) allowances for children and wives are paid from social insurance funds.
An important feature of the social insurance schemes is that they are generally largely or entirely self-supporting (some information on financing is given in Appendix VII). Only in Japan is the Government substantially involved in the financing. In Burma the Government pays 1 per cent of the covered earnings, and in Taiwan 2.4 per cent of the earnings of the self-employed groups included in the scheme. One-eighth of the cost of medical benefits under the social insurance scheme
in India is met by the respective states, and the Government of Viet-Nam (North) is entirely responsible for medical care. It is not uncommon for governments to assist the social insurance scheme in its initial stages by means of loans or grants for administrative expenses, and this is currently the case in Malaysia, where the full administrative costs are borne by the exchequer. Other characteristics of the existing social insurance systems are the emphasis on short- and the very limited provision for family allowances and unemployment benefit. However, it is also apparent that there is a definite trend towards greater use of social insurance principles for employment injury and also for protection against the consequences of permanent cessation of earnings due to old age, invalidity or the death of the breadwinner. This trend is evidence of the limited protection afforded by employers' liability schemes for employment injury and the wider appreciation of the fundamental deficiencies of statutory provident funds in providing a substitute income for prolonged periods, or for life.
term contingencies,
Statutory provident funds
Statutory provident funds, a form of compulsory saving by and on behalf cf specified groups of workers, are in existence in Bangladesh (tea plantations), Fiji, India, Malaysia, Singapore and Sri Lanka. Summaries of the scope of the last four provident funds, and of their contribution rates are given in Appendices X and VII respectively. No pooling of risks is involved and the payment of benefit by single lump sums gives no guarantee of a substitute income throughout the contingency which is essential as the provident funds are intended for the long-term contingencies of old age, invalidity and death of the breadwinner. Furthermore, there is a tendency to liberalise the rules for repayment of all or parts of the individual balances. Malaysia allows а one-third payment five years in advance of the age limit for complete withdrawal. In Sri Lanka, female members of the provident fund are entitled to claim upon ceasing employment as a consequence of marriage. Singapore permits the withdrawal of all accumulations if needed to purchase approved housing accommodation. Whilst it is understandable that members of these provident funds should desire to obtain their balances for various purposes, it must be recognised
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