Moving towards inclusive growth A case of the Social Security System

Transcription

1 Good Practices in Social Security Good practice in operation since: 2012 Moving towards inclusive growth A case of the Social Security System Special mention, ISSA Good Practice Award - Asia and Pacific competition 2015 Social Security System Philippines Published

2 1 Summary The Social Security System (SSS) is tasked to provide a social safety net to workers in the private sector, the self-employed and the informal sector. Cognizant of the informal sector's employment generation and economic contribution capacities, the SSS deemed it necessary to extend coverage to their workers. But doing so requires creative approaches to reaching out to the informal sector: approaches that recognize the irregularity of their incomes and differences in the nature of their businesses; those requiring partnerships with organized groups to identify shared responsibilities; and approaches allowing "wholesale" social security coverage instead of SSS going after individual workers. In this report, the SSS shares the experiences of programmes recently implemented: 1) AlkanSSSya Programme for the Self-Employed in the Services Sector; 2) Servicing and/or Collecting Partner Agent Arrangement for Cooperatives and Micro-finance Institutions; 3) Social Security Subsidy Programme; 4) Coverage for Government Job Order/Contractual Workers; and 5) MuniSSSipyo-Collect Programme for Unbanked Areas. The SSS is building its success in helping members of this vulnerable sector get the social protection they deserve, at an amount that is within their reach. CRITERIA 1 What was the issue/problem/challenge addressed by your good practice? The SSS recognizes the informal sector's employment generation and economic contribution capacities, and the SSS deemed it urgent and necessary to extend social security coverage to these workers. But doing so requires creative approaches to reaching out to the informal sector: approaches that recognize the irregularity of their incomes and differences in the nature of their businesses; those requiring partnerships with organized groups to identify shared responsibilities; and approaches allowing "wholesale" social security coverage instead of SSS going after individual workers. CRITERIA 2 What were the main objectives and the expected outcomes? The SSS redefined new approaches to reach out to the informal sector groups (ISGs), as well as address their aversion to formal banking transactions and their reluctance to take time off from their work just to transact. The new schemes also recognized the irregularity of informal sector workers' incomes, particularly during the periods with very low or no income, when their

3 2 sustenance needs take precedence over social security contributions. It was deemed critical to partner with organized ISGs, so that there are identified officers or persons responsible for the monitoring and implementation of the programme. Dealing with ISGs also allowed for "wholesale" social security coverage instead of SSS going after individual informal sector workers on a piecemeal basis. Partnerships with Local Government Units (LGUs) were also seen as crucial to extend social security coverage to their employees, particularly contractual workers, who are not covered by the public sector social insurance system. LGUs in remote areas, where banking facilities are non-existent, were also tapped as collecting agents of social security contributions as a way to encourage new and re-activated membership of their constituents. CRITERIA 3 What is the innovative approach/strategy followed to achieve the objectives? The approach was to improve on various pilot projects and initial successes became the basis to implement these programmes nationwide. A pilot project started in 2011 was with a group of tricycle/pedicab drivers (drivers hired by passengers using a tricycle - a sidecar attached to a motorcycle or bicycle) in a small city of Las Piñas. The SSS Branch in Las Piñas, developed an "out-of-the-box" solution to cover and collect from self-employed members with irregular income, particularly drivers of tricycles. It was tagged as "TrikanSSSya", a play on tricycle, SSS and "alkansya" which meant piggy bank. This programme was intended to address the clamour of the growing informal sector for social security coverage and the need for it to be convenient, as they had difficulty making payments in banks or even at SSS branches that had limited office hours. It had to be affordable as they had irregular earnings and could not come up with the required monthly contributions in full. To address this, the programme involved monthly contribution collections by SSS - and in some cases by a bank or accredited third-party collecting agents - from tricycle drivers, who make deposits of ten to twenty pesos (US$ ) daily in a giant steel box installed at the tricycle transport terminal. The pilot was later developed for implementation to other ISGs and named "AlkanSSSya". The process was streamlined so that payment transaction reports, which used to be submitted by members, were then computer-generated and instead these reports were provided to them, resulting in more accurate posting to these individual members' accounts. Management appointed a Task Force to assist and train different branches to market the programme. A "kit" was developed containing relevant information about SSS and the benefits the members may avail of the AlkanSSSya Programme, sample forms, specifications for the steel box, and the draft standard Memorandum of Agreement (MOA) between the SSS Branch Manager that will service the ISG and the head of the ISG. The MOA was critical to identify responsibilities and accountabilities of each party. It was important that coverage and collection

4 3 through AlkanSSSya would be through organized groups or associations, regardless of whether there were formal or informal arrangements that bound this group. The Task Force, in tandem with the Branches, looked for other ISG applications to which AlkanSSSya could be implemented. While the same standard steel box had been specified, the ISGs were given some flexibility to allow for more resourceful and creative solutions that will be affordable to the group, as long as these boxes were secured and safe, and installed in an area that will be watched over 24/7. AlkanSSSya has been implemented in many different ISGs. Within a year of implementation, some 49 ISGs had signed up covering 4,241 workers. As of the end of April 2015, 1,118 ISGs have been enlisted covering 107,091 workers. With the successful implementation of the AlkanSSSya Programme, SSS also started other schemes to cover the informal sector: 1. Servicing and/or Collecting Partner Agent Agreement for cooperatives and micro-finance institutions. 2. Contribution Subsidy Programme for farmers and workers in the agricultural sector. 3. "MuniSSSipyo-Collect" Programme for unbanked areas or provinces. CRITERIA 4 Have the resources and inputs been used in an optimal way to achieve the set objectives and the expected outcomes? Please specify what internal or external evaluations of the practice have taken place and what impact/results have been identified/achieved so far. Resources and inputs have been put in place to ensure that the objectives were met and sustained implementation is done. Close monitoring is being done to ensure a smooth implementation and programme sustainability, and making sure covered members regularly remit their contributions. Table 1. AlkanSSSya Implementation Report According to Type of Workers (as of April 2015) Informal Sector Group Total Associations Covered Total Members Registered Total Collection Total Collection in PhP in US$ Transport ,683 83,895,993 1,884,456

5 4 Tricycle Operators and ,450 70,240,315 1,577,725 Drivers Assoc. Tribike/Pedicab Operators 19 1,353 2,215,151 49,756 and Drivers Assoc. Jeepney Operator and 46 3,573 7,619, ,154 Drivers Assoc. Motorboat Service ,009,199 22,668 Providers Shuttle Bus Operators/ ,390 9,420 Drivers Pumpboat Operators ,739 4,329 Van Drivers ,458 10,073 Airport Service Providers ,760 12,102 Bus Dispatchers , Habal-Habal Drivers ,178,720 26,476 Agriculture 76 7,373 8,384, ,322 Farmers 59 5,905 6,934, ,764 Fisherfolk Workers ,031 19,542 Fishermen ,458 13,016 Vendors ,328 23,852, ,761 Market Vendors 88 10,885 21,492, ,752 Ambulant Vendors 19 1,711 1,481,809 33,284 Fish Vendors ,258 13,168 Retail Traders ,894 6,556 LGU & Other Agencies ,582 18,304, ,158 LGU (Brgy. EEs & Tanod, ,425 15,058, ,235 Volunteer Workers) 15,058,240 Day Care Workers ,551 11,782 Job Order Contractual 17 1,935 2,721,970 61,140 Services ,504 9,603 Reflexologists ,344 5,331 Caregivers ,010 2,381 Porters ,150 1,890 Others ,933 37,045, ,108 Jail Inmates 44 3,547 5,281, ,631 Material Recovery ,293,161 29,047 Workers (Garbage Pickers) Golf Course Workers 30 3,977 8,974, ,581 Pottery Makers ,652 3,541 Community-Based Associations ,652 3,541

6 5 Cooperative Members 96 11,300 12,248, ,115 Beach Cottage Owners 41 3,823 6,927, ,615 Persons with Disability ,416 3,513 Lay Ministers ,382 3,355 Customer Care Assistants/ ,205 12,808 Night Workers Memorial Park Caretakers 4 1,576 1,007,194 22,623 Recreational Horseback , Riding Masters Hog Raisers ,565 4,325 Small-Scale Miners ,110 1,238 TOTAL 1, , ,909,882 3,861,408 Average Monthly Collection: PhP5,056,173 ($113,571) End period April 2015: US$ 1 = PHP CRITERIA 5 What lessons have been learned? To what extent would your good practice be appropriate for replication by other social security institutions? First of all, different approaches are necessary to cover informal sector groups. Social security institutions cannot rely on traditional schemes as these groups are vulnerable and have created adverse behaviours in dealing with usual banking schemes for collection. It was also critical to obtain support from the Local Government Units (LGUs) as the ISGs were their constituents. Some LGU leaders paid for the AlkanSSSya boxes while others passed a Resolution that initiated coverage for the groups they regulated. Such arrangements have therefore been extended to job order and contractual (JO/C) workers in government who are not covered by the Government Service Insurance System (GSIS). In 2014, SSS signed Memoranda of Agreement (MOA) with the Department of Interior and Local Government (DILG) and the Department of Social Welfare and Development (DSWD), employing 100,000 and 12,000 workers, respectively, as JO/C hires to provide SSS coverage as self-employed members. The programmes that the SSS developed may be appropriate for replication by other social security institutions.