ILO Online: What impact have the economic and
social changes of the last few decades had on
social protection systems in the industrialized
Emmanuel Reynaud: The period of full employment during which the existing social protection systems were developed is now over in the industrialized countries. The emerging services-dominated economy is creating greater inequalities, and it allows no scope for productivity increases on the scale seen in the thirty years after World War II, which played such a crucial role in financing social protection. At the same time, the process of globalization is bringing greater insecurity and is putting strong pressure on governments and businesses to reduce labour costs, including social security contributions.
As the same time, social protection systems are facing an aging population. Two major changes are having a dramatic effect on the financing of pension systems: the baby-boom generation is gradually starting to retire and life expectancy at retirement age is increasing steadily (by around one-and-a-half years every decade). The question is therefore how to distribute the growing cost of financing pensions.
Overall, the challenge currently faced by the social protection systems in the industrialized countries is twofold: providing adequate protection in a situation of heightened uncertainty on the labour market, and combating poverty and social exclusion in order to prevent sections of the population from being trapped in deprivation and exclusion. This means, first, designing new forms of protection that are better suited to workers' increasing mobility and, second, combining social inclusion policies with schemes guaranteeing a minimum income.
ILO Online: Is the issue different in developing
Emmanuel Reynaud: The problem of inadequate social security coverage is not a new one for the developing world, particularly in countries where a large proportion of the population is working in subsistence agriculture. Today, however, in the developing countries, the traditional forms of protection provided by the extended family and the community have largely been eroded with the process of urbanization and industrialization.
Moreover, the growing proportion of the urban labour force working in the informal economy has made the problem worse. Informal employment accounts for half to three-quarters of all non-agricultural employment in the developing countries. There is an urgent need for new collective systems capable of protecting individuals who can no longer rely on traditional solidarity networks.
In earlier decades attention was generally focused on old-age pensions and long-term benefits to guarantee people a secure income once they had stopped work. Today, priorities are focused on the short term and have to do with health and immediate compensation for loss of income. This is particularly evident in the poorest countries because of the limited life expectancy and the consequences of HIV/AIDS.
But more generally, looking beyond decisions on which contingencies to cover as a priority, the scale of people's need and the low level of protection provided in the developing countries suggest that the concept of social security should be extended to include meeting basic needs in terms of access to food and water, health care, housing and education.
In poor countries, where the State has limited capacity, the development of community-based initiatives has appeared, offering a promising solution. These initiatives must also not make the existing statutory schemes more fragile, or organize separate solidarity among those who are poor; they must form part of a coherent national policy for extending social protection.
ILO Online: Have innovative ways been found of
extending social protection?
Emmanuel Reynaud: The developing countries that have succeeded in extending social protection to populations not previously covered have used a wide range of instruments.
One of the strategies used to cover workers in the informal economy consists of identifying different groups whose needs, ability to contribute, and employment and social integration situations are fundamentally different. Uruguay provides a good example. Three groups of workers have been identified as having special problems because their jobs are insecure and informal - construction workers, domestic staff and the self-employed - and specific arrangements have been made for each of them.
In recent years a new type of programme has attracted growing interest. The principle is to target poor households and to make the payment of cash benefits dependent on certain behaviour and practices, such as children's attendance at school, regular visits to health centres, and participation in education programs. The idea is to combine direct financial aid with a long-term approach designed to improve education and health in poor families.
ILO Online: Is there a "recipe" for
social protection policy?
Emmanuel Reynaud: The current situation in the world suggests that a broad concept of social protection should be adopted, that meets the basic needs of people, enables them to live in dignity, strengthens their capabilities and promotes their social integration.
There is no exemplary system, which can be held up as a perfect model. In all the countries where social protection has been developed to a high degree, it has evolved along with society and must be re-thought constantly in response to changes in terms of population, medicine, the economy and lifestyles.
It is not a question of those countries whose populations are exposed to economic and social insecurity "catching up" with other countries which could be cited as examples in this regard. Rather, they must trace their own path, by drawing on their own values and knowledge in order to implement appropriate solidarity systems corresponding to the priorities they have set.
Note 1 - "Social protection and decent work: New prospects for International Labor Standards", in Comparative Labor Law and Policy Journal (University of Illinois, Urbana-Champaign), Vol. 27, No. 2, Winter 2006. See http://www.law.uiuc.edu/publications/cll&pj/archive/vol_27/