Social Security Introduction

Social security is defined as “the security that society furnishes, through appropriate organization, against certain risks to which its members are exposed”.

These risks are essentially contingencies against which the individuals, who has small means, can not project himself.

These contingencies include- employment-injury sickness invalidism occupational disease maternity old age widowhood orphanhood unemployment, etc.

Mouric Stack, defines social security as : “a programme of protection provided by society against these contingencies of modern life- sickness, unemployment old age, dependency, industrial accident and invalidism-against which the individuals cannot be expected to protect himself and his family by his own ability or foresight”.

In modern industrial society, the majority of the population is dependent for their livelihood upon their current wages as labourers, workers and employees or upon their income as self-employed persons. Whenever, the breadwinner is unable to work, when his death leaves his family in need, outside help is necessary to provide economic protection.

In the industrial countries, people cannot depend upon the relatives, friends or neighbors to assume the responsibility to supply the funds for maintaining the families.

There are three main systems of achieving this goal of economic or income security:

1. A programme of public Assistance (for social assistance), which is financed by taxation. e.g. Govt. Relief program, Jakat, Fetra, Flood Rehabilitation program.

2. A programme of social insurance- financed by contributions of the beneficiary and of his employers. e. g. Provident fund, Group insurance, Benevolent fund (contributory) Pension (earned as an ex-service holder), Unemployment benefit, (as citizen)

3. Social service. e.g. Govt. & Non—Govt. initiative related to Education, Health, Child / Youth Welfare etc. '

Approach and/or Methods Social Security

(A) Public Assistance may be provided by payments based upon the economic and social needs of the applicant, which are often determined by a specific requirement or they may be granted as a “flat rate allowance” legally fixed with regard to average needs of families of a specific size. Assistance usually is rendered in money so that the recipients are able to purchase the necessities of life, or in kind such as food, clothing, fuel, medicines etc; Since public assistance is granted only to individuals who are in economic need, this fact must be established through some kind of measurement. The administration of public assistance determines the extent of need, and the. amount of aSSistance often cannot be predicted in advance.

In contrast with public assistance, social insurance benefits are fully predictable. They are based upon legal provision, which provide statutory benefits either on a flat rate system or in relation to earned wages, or income, length of service, or loss of working capacity to cases of industrial injuries. Insurance benefits are not dependent upon the financial status or the economic need of the insured person. They are provided to the insured that has a legal claim to receive these benefits without arbitrary interference of Government authorities.

(B) Insurance benefits are financed by contributions from employers, self employed persons and from workers. In some countries often the Govt. share contributions for social insurance with the insured and their employers.

(C) Besides, the two main methods or systems of providing economic security, there is a third approach to income security: a pension system based upon statute— e.g. retirement pensions, old age pensions, family allowances, pensions to disabled veterans or their survivors etc.

Characteristics of Social security programme I. They are established by law II. They provide some form of cash payment to individuals to replace at least a ' " part of

the lost income III. The benefits or services are provided in three ways

A. Social insurance B. Social assistance C. Public service/ social service.

Social Insurance : Social insurance is described as the “giving, in return for contribution, benefits upto subsistence level, as of right and Without means tests. So that an individuals may build freely upon it.”

Social assistance : Social assistance is provided as a supplement to social insurance for those needy persons who cannot get social insurance payments, and is offered after a means test.

Difference between Social Insurance and Social Assistance

Social Insurance Social Assistance

01. Funds are created by the contribution of state, employer & employee or without the contribution of employees.

01. the incumbent does not contribute

02. Membership to organization or employment is must

02. Membership or employment is not essentialn

03. It ensures minimum standard of living 03. It does not ensure minimum standard of living

04. It is permanent 04. It is temporary

05. It is matter of right 05. t is not a matter of right

06. Benefits are given/ granted without regard to an examination of individual needs without any means test

06. Need is the basis for consideration i.e. benefits are granted on the basis of needs.

07. It is compulsory & covered by Law, rules/ regulations of the state organization

07. It is voluntary and is based on ability and good wishes of donor/ organization. or state.

ILO Convention on Social Security

In 1952 ILO convention on social security (minimum standard) divided social security into nine components. :

1. Medical care Sickness Benefit2. Unemployment Benefit3. Old age benefit4. Employment injury Benefit5. Family Benefit6. Maternity Benefit7. Invalidism Benefit8. Survivors Benefit

Social Security for industrial workers of Bangladesh

1. Provident Fund. 2. Employees group Insurance3. Benevolent fund4. Gratuity / pension 5. The workmen’s compensation 6. The Maternity Benefit7. Sickness Benefit 8. Compensation for Lay-off Employee