Even though the number of countries providing some social security has increased over the decades, the overall performance of social security in many countries has been disappointing, especially essential aspects such as coverage of social security. Although it is difficult to list all the complex and various reasons for disappointing performance of social security, there are some imaginable ones:
- Some are external: many schemes are struggling to cope with new obligations in a new political and economic environment and make efforts to adjust themselves to the situations. These are classified as design issues of social security.
- Some are internal and so-called governance problems: many schemes lack fundamental information, for example, how many people are covered compared to how many should be covered according to the legislation, or the relative level of the present contribution compared to the pay-as-you-go cost rate (the contribution rate which is necessary to balance annual expenditure and income). Therefore they cannot and do not take necessary measures to remedy shortcomings of the schemes, which inevitably leads to the lack of confidence of people in social security and to the failure of social security.
It is important to develop a set of quantitative performance indicators which can be used by managers and supervisory bodies to assess the performance of social security schemes. Difficult as it is to standardize indicators in different social and economic content, a set of standard quantitative indicators should be developed as a handy tool of assessment of the scheme. These might lay common factual basis in the decision-making process by all social partners - the various stakeholders of social security schemes, i.e. managers and supervisory bodies of the schemes as well as contributors and beneficiaries.
- The social security department of the ILO has developed Performance Indicators (PIS) of Statutory Social Insurance Schemes.
- The Bureau of Health Insurance of Hunan Province of China was designated to evaluate the ILO PIS in 2009. The assessment report, in Chinese, was completed at the end of 2009. The English version of the report is also available.