World Social Protection Report 2017-19
Over half of the elderly in Philippines have no pension
A universal pension can propel Philippines towards reaching global social protection standards.
Bangkok/Thailand (ILO News) – Only 29 per cent of the world population enjoy comprehensive social protection and more than 1 out of 2 people have no protection at all, says the ILO in its new World Social Protection Report 2017/19. This leaves many vulnerable to poverty, inequality and social exclusion, constituting a major obstacle to economic and social development for any country says the ILO in its flagship report which provides an inventory of social protection worldwide—covering the state of benefits for maternity, unemployment, old age, healthcare, etc.
Despite being considered the engine of the world economy, Asia clearly lags behind when it comes to the protection of its population. The decades-long development model dominating the region prioritised economic growth at the expense of redistributive policies. Consequently, a large share of the population are denied the right to social protection.
The gap in pension coverage is particularly relevant because the region is ageing at a historically unprecedented rate. Where OECD countries took 50-100 years to transition from young to old societies, Asian countries are taking just 20-25 years. And yet, nearly half the elderly in the region still do not benefit from a pension, a proportion that is only higher in Africa.
Despite progress in recent years, Philippines’s social protection system retains serious gaps. For example, the majority of the elderly citizens of the country do not have income security, i.e. do not have a pension, despite a significant increase in allocation. This is in contrast to countries like China, Thailand, Mongolia, Brunei Darussalam and Timor-Leste which have considerably expanded their coverage through the use of universal tax funded pensions.
The pension gap is happening at the same time that life expectancy for Filipinos is rising on average. Between 2000 and 2015, life expectancy rose by five years, which is the fastest increase since the 1960s. This makes the low pension coverage a particularly troubling problem, creating additional financial burdens for family, as the ratio between elderly parents and adult children rise.
In 2017, the government made efforts to increase benefit levels of senior citizens receiving contributory pension and to increase the social pension coverage of indigent senior citizens. However, around forty per cent of Filipino senior citizens are still left without income security.
On the positive side though, social protection remains one of the major agenda in the country as reflected in the Philippine Development Plan 2017-2022, launched in January 2017. The plan has identified adopting and institutionalizing the Social Protection Floor as one of the strategies to achieve universal social protection under the Strategic framework to reduce vulnerability of individuals and families. Specific strategies include establishing an unemployment insurance system, enhancing social protection for the informal sector, improving the social pension system, expanding health insurance packages, and strengthening mechanisms to ensure enrolment in the social security system, among others. Further, it also highlights the need to address implementation issues on convergence, planning, mainstreaming at the local level and better data collection.
Khalid Hassan, Director of ILO Manila Country Office, recommends, “ILO’s new report shows many countries, regionally and across the world, are prioritizing their social protection systems. We think this is a good time for Philippines to follow the same path and extend protection to its elderly through the launch of a universal pension.”
For more information, please contact: Nuno Meira Simoes da Cunha, Senior Technical Specialist on Social Protection, International Labour Organization at cunhan@ilo.org.
Despite being considered the engine of the world economy, Asia clearly lags behind when it comes to the protection of its population. The decades-long development model dominating the region prioritised economic growth at the expense of redistributive policies. Consequently, a large share of the population are denied the right to social protection.
The gap in pension coverage is particularly relevant because the region is ageing at a historically unprecedented rate. Where OECD countries took 50-100 years to transition from young to old societies, Asian countries are taking just 20-25 years. And yet, nearly half the elderly in the region still do not benefit from a pension, a proportion that is only higher in Africa.
Despite progress in recent years, Philippines’s social protection system retains serious gaps. For example, the majority of the elderly citizens of the country do not have income security, i.e. do not have a pension, despite a significant increase in allocation. This is in contrast to countries like China, Thailand, Mongolia, Brunei Darussalam and Timor-Leste which have considerably expanded their coverage through the use of universal tax funded pensions.
The pension gap is happening at the same time that life expectancy for Filipinos is rising on average. Between 2000 and 2015, life expectancy rose by five years, which is the fastest increase since the 1960s. This makes the low pension coverage a particularly troubling problem, creating additional financial burdens for family, as the ratio between elderly parents and adult children rise.
In 2017, the government made efforts to increase benefit levels of senior citizens receiving contributory pension and to increase the social pension coverage of indigent senior citizens. However, around forty per cent of Filipino senior citizens are still left without income security.
On the positive side though, social protection remains one of the major agenda in the country as reflected in the Philippine Development Plan 2017-2022, launched in January 2017. The plan has identified adopting and institutionalizing the Social Protection Floor as one of the strategies to achieve universal social protection under the Strategic framework to reduce vulnerability of individuals and families. Specific strategies include establishing an unemployment insurance system, enhancing social protection for the informal sector, improving the social pension system, expanding health insurance packages, and strengthening mechanisms to ensure enrolment in the social security system, among others. Further, it also highlights the need to address implementation issues on convergence, planning, mainstreaming at the local level and better data collection.
Khalid Hassan, Director of ILO Manila Country Office, recommends, “ILO’s new report shows many countries, regionally and across the world, are prioritizing their social protection systems. We think this is a good time for Philippines to follow the same path and extend protection to its elderly through the launch of a universal pension.”
For more information, please contact: Nuno Meira Simoes da Cunha, Senior Technical Specialist on Social Protection, International Labour Organization at cunhan@ilo.org.