Strasbourg, 20 December 2016 MISSCEO(2016)8
MUTUAL INFORMATION SYSTEM ON SOCIAL PROTECTION
OF THE COUNCIL OF EUROPE
(MISSCEO)
MISSCEO INFO 2016
Overview of recent trends and
developments in social protection
OVERVIEW OF RECENT TRENDS AND DEVELOPMENTS
IN SOCIAL PROTECTION (2016)
Content
Regulating employment and active employment measures
Social risks and social benefits: automatization and introduction of IT in administrative processes
Long-term benefits: pension and disability schemes
This paper seeks to identify recent trends and developments in social protection across those member states which make contributions to the Council of Europe publication ‘Mutual Information System on Social protection of the Council of Europe’ (the MISSCEO member states for the purpose of this text). The paper is based on information provided by the national correspondents who have reported recent changes in legislation and social policies within their state. This edition relies upon country reports submitted on behalf of Albania, Armenia, Azerbaijan, Bosnia Herzegovina, “The former Yugoslav Republic of Macedonia”, Georgia, Serbia Turkey and Montenegro. The views and opinions expressed within this paper are those of the author alone and not of the member states or the Council of Europe. All efforts have been made to confirm the accuracy of the information contained within this report and the author is much obliged to the member states for the assistance they have provided. Due to the limited number of states that are within the network of MISSCEO, and the variety of the undertaken measures, it has been decided to group the trends under common description headings. These are:
- Regulating employment and active employment measures
- Social risks and social benefits (general)
- Long-term benefits: pensions and disability schemes
- Sickness and maternity
- Modernizing health care
- Need and family burden
Regulating employment and active employment measures
In the past two years, there was an increase in Albania of the state budget funds allocated for programs to promote employment by increasing significantly the number of recipients who are unemployed jobseekers.
In 2015, the state budget was increased with 450 million ALL, to promote employment by supporting private businesses that develop programs targeted to specific groups of jobseekers facing structural problems on the labour market, such women from minority groups, disabled persons and youngsters.
In support of young people who enter for the first time in the labor market, special employment programs were implemented through internships employment contract with a minimum duration of at least 15 months.
Moreover, employment promotion programs were designed in support of unemployed orphans below the age 30 and unemployed young mothers, who have children up to the age of 18. These programs offer subsidies up to 115% of the minimum wage, to enable these categories a decent employment and a decent standard of living. 3.6% of the registered unemployed jobseekers are now beneficiaries of these employment promotion programs.
Activation of groups that are difficult to employ, is also a key-item in the labour market policy of Armenia. Next to the ongoing legislative initiatives targeting the rights of persons who face structural unemployment two new projects were launched, which aim at the organization of payable public works and the support for cattle breeding.
Now, in total thirteen active state regulatory projects on activation functioning. They aim at ensuring sustainable employment for persons facing structural unemployment, in particular for persons with disabilities and the youth.
In Azerbaijan the labour market has actually grown as a result of measures to diversify the economy and to make it less dependent upon the oil sector. As a result the unemployment rate has dropped to 5 %. In particular, a total of 37,000 jobs were created in the country in the first quarter of 2016, including 31,000 permanent ones.
Alongside this policy of economic diversification, 6 million AZN has been allocated (April 2016) to the Ministry to assist in encouraging entrepreneurship among the population, especially the poorer parts of them. This order was a departure from the previous strategy of passive assistance provided to low-income families. Instead, a new strategy is adopted to facilitate sustainable employment programs for physically capable members who are stuck in unemployment. Several pilot projects were launched in partnership with the International Labour Organization (ILO). These pilot projects assist low-income households in setting up family businesses and in expanding self-employment opportunities. Social aid is now mainly targeted to defined social groups, such as orphans, persons having to support handicapped persons in the family, persons who themselves are (partially) disabled or face serious and/or chronic health disorders, people above the age of 65, as well as families with four or more children. In general, 70% of such families live outside Baku and 75% of them have private land plots. More than 50% of recipients of targeted social assistance are older than 18. Such families can, in addition to the social aid, receive 4,000 AZN to set up a family business. The tools and livestock to be provided to these families will also be insured. Already 1,400 households across the country are expected to benefit from self-employment programs.
In “The former Yugoslav Republic of Macedonia” the government adopted in October 2015 the National Employment Strategy 2016-2020. The main goal of the National Employment Strategy is to increase employment and to improve the quality of jobs and productivity, with a special emphasis on vulnerable groups.
Among the many measures, the government intends to increase participation of the vulnerable people into the active labour market measures (people that have been unemployed for more than two years, social assistance beneficiaries, women victims of family violence and people with disability and diminished functional capacity). Integrated employment measures will be implemented for the vulnerable categories, like social financial assistance beneficiaries. These measures will also include counselling, training and subsidized employment.
Moreover, it is planned to introduce changes to the system of financial assistance in order to allow the combination of the financial assistance and wage up to a certain threshold (as opposed to losing the benefit immediately upon finding employment). This measure will stimulate the activation of assistance beneficiaries and will reduce the level of informal work among these people.
In Montenegro on the other hand the emphasis was put on expanding the existing Law on Employment and Unemployment Insurance to include students. This group can now be included in active employment policies as well. Also, persons with development problems and persons who finish school according to a special educational program have the right on allowance during unemployment periods (40% of minimum wage) and the related activation measures.
Social risks and social benefits: automatization and introduction of IT in administrative processes
Many countries invested in procedures of data sharing and improvement of benefit delivery. Data sharing is mainly used to track down undeclared work and income. Some countries use it to improve the procedures on the assessment and control of work incapacity. The modernization of these administrative processes is to a large extent accompanied with new IT-processes and a further automatization of the administration.
In Armenia activities are carried out for ensuring online data exchange between different information systems (including those of other state bodies outside the field of social security). By doing so the government has the ambition to improve significantly the quality of services provided to the beneficiaries.
Azerbaijan had a year of extensive and comprehensive modernization of its administration in all relevant sectors of social security. A system of electronic tracking of employment contracts introduced by the Ministry in 2014 allows now to monitor the labour market more objectively and to make employment relations more transparent. According to the information obtained from this system, the number of hired employees has increased by 6,600 people and reached 1,256,700. The system is currently in use throughout the whole country. Processes relating to the hiring of persons or the changing or terminating of the contract are updated within the notification system. This system is accessible by both employees and employers. The service is provided within the existing E-government portal. It turns out to be beneficial for background checks controlling the employment in the country as well. It helped to increase the transparency in the labour market, the revenue in the state budget and it facilitated better protection of rights of employees. The accomplishment was a joint effort of numerous ministries and government agencies and provided benefits for other government agencies and ministries, reaching out beyond the mere field of social security. The Ministry of Treasury and Taxes uses the system e.g. to carry out desk tax audits on labour contracts. The database can also be used for verification and assignment of social security benefits.
Apart from employment other IT-processes have been transforming the applications within social assistance and health care delivery as well. For the last year and a half, numerous reforms have been implemented to establish the Electronic Application and Assignment of Targeted Social Aid (VEMTAS) and the Medical and social expertise and rehabilitation system (TSERAS).
The unified electronic application system of VEMTAS is accessible through internet, special e-government stands or post-offices. There is no contact between officials and applicants. Both the evaluation of the applications and assignments of benefits are made electronically. Since February 2016, it has been implemented throughout the whole country. Applicants neither need to collect nor submit any hard-copies. Instead the Ministry collects all relevant information from databases of other ministries and government agencies. Applications that are accepted are considered within fifteen days. Citizens receive confirmation for acceptance through SMS notification. The successful applicants are also notified about the address of the bank branch from which they will receive a social protection (plastic) card.
Alongside VEMTAS the Ministry established a new E-Subsystem of medical and social expertise and rehabilitation (TSERAS) within the existing E-government portal. For medical and social examinations citizens can apply online for assessment of their disabilities. All documents can be accessed in electronic format from databases of the relevant government institutions. The results of all the disability and limited capabilities examinations are included in real-time. Moreover, citizens can get their diagnostic results, their assigned category of disability, and the future date of examination. The system also automatically tracks the duration of different categories of disability. It is no longer necessary for some 200,000 people to undergo medical examination every year.
To minimize contact between citizens and officials, the Ministry launched an automated system for pension appointment through a single call center. Citizens who reach retirement age can call 142 and automatically activate their right to receiving pension by providing their national ID card numbers. They don’t need to present any new documents. They also have access to the E-government portal where they can learn about their pension capital accumulated on their individual accounts and calculate the amount of pension using the e-service "retirement calculator". Now almost 100% of all pensioners are covered with a plastic card payments.
As of July 2016, interinstitutional electronic exchange of data will become mandatory in “The former Yugoslav Republic of Macedonia” for the administration of all social protection benefits. It is viewed as improving business processes in the state administration and it is expected to reduce the (financial) burden for the government and to save administrative expenses for the citizen.
In order to claim certain benefit, the applicant was asked to collect and submit a number of documents on the basis of which the entitlement to the benefit would have been decided. All public institutions and agencies involved in administration of social protection benefits (e.g. all type of social assistance, child benefits, unemployment or pension benefits) are now required to keep electronic records for their clients and to communicate data electronically.
The solution will shorten the length of the procedure to process the claim. For example, social assistance, which is a means tested benefit, is claimed at the local social work center. The authorized officer of the social work center will be obliged within three days from the receipt of the claim, ex officio to request evidence and data from competent public authorities, such as the Employment Service Agency, the Agency for Real Estate Cadastre, the Pension and Disability Fund of Macedonia, the Public Revenue Office, etc. The competent public authorities are obliged to submit the required evidence and data within three days from the receipt of the request. The decision for granting the benefit must be issued by the social work center within 60 days from the receipt of the claim. This solution is beneficial for the citizens who claim their rights, as from now on they will not be required to supply documents from different governmental departments, saving time and administrative costs.
In Turkey much efforts went into the launch of an Online Payment Inquiry and Bank Account Submission System On E-government. According to Law No. 5510 (Social insurance and Universal Health Insurance Law) some short term and long-term insurance benefits and similar payments, called ‘Payments to Person” are paid now through the beneficiaries’ ID number. Formerly, these payments were sent to the bank without the individual’s bank account; beneficiaries were to present themselves (physically) at the bank to become entitled to the benefit. Now, with ‘Online Bank Account Submission’ the beneficiaries can now submit their bank account on-line to the SSI on the e-government site after which they are able to get their payment directly through their bank account. Finally, beneficiaries are able to ask through the 'Payments İnquiry System" whether payments were accrued.
In Serbia it is worth noticing that the Agreement on Electronic Exchange of Data in the Field of Pension and Disability Insurance and Technical Protocol on Electronic Exchange between the Republic of Serbia and “the former Yugoslav Republic of Macedonia”, signed in 2015, has become applicable since January 1, 2016.
Long-term benefits: pension and disability schemes
The pension reform in Albania got materialized by changing the necessary parts in the “law on social insurances”. The main goal of the reform is to strengthen the contributory principle of the current system and to reduce the high degree of redistribution. It gives individuals more incentives to be part of the social security system and to unveil the real wages and income out of self-employed activities. On the other hand, this reform guarantees a social pension for all the elderly who do not qualify for a pension benefit through a basic social pension.
In addition, the reformed pension limits the maximum pension up to twice the amount of the minimum pension. The pension are calculated to 75% of the net salary. Moreover, the reform aims to eliminate the existing differences between rural and urban pensions and it no longer provides special privileges for farmers as they are now included in the overall pension scheme.
The changes introduced in the pension scheme are numerous and without being exhaustive refer among others to:
- the pension calculation formula and the abolition of the maximum pension ceiling;
- the way of indexing the pension amount, by the annual inflation index;
- the calculation of the minimum wage contribution (related to the official minimum wage) and the alignment of the limitations of the maximum wage indexation of contributions with the average salary increase;
- the increase of the pension record (years during which social security contributions are paid) from 35 to 40 years by 2025;
- increase of the retirement age (for women with two months per year in order to reach 63 years in 2032; for men to one month per year, starting in 2032; final equalization of retirement age for both sexes will be 67 years in the year 2056)
- increase of the contribution rate for rural areas to level the contributions of those in urban areas by 2017;
- introduction of the minimum social pension, for individuals who have reached 70 years of age and have not completed the minimum period for 15 years for the pension;
- Supplementary insurance schemes for state employees and people working in the private sector, creating a more transparent link between contributions and benefits received.
- Occupational schemes for difficult professions which include several categories of workers such as those in the mining industry, oil and metallurgy, art and culture workers etc. These schemes aim to guarantee an income for individuals who retire earlier than the official age of retirement. Occupational schemes will be fully contributory, where the contributions will be divided between employers and employees and will be created on the basis of collective agreements.
In Armenia the reforms in the pension field mainly target (the reduction of) poverty among pensioners. The base for calculating the basic part in the labour pension was increased by 16000 AMD (year 2015) compared to 14000 AMD before and the value of one year of professional record also increased (to 800 AMD for the first ten years, and 500 AMD for each following year above ten). As a result, the average labour pension increased by about 14 percent compared to the previous year and made 41000 AMD.
Along with the legislative changes, the processes for controlling the pension payments are being improved. By periodically comparing the information of the state pension system data registry and the information present in registries of other state bodies, it becomes possible to prevent illegal payments and to return the extra paid pension amounts to the RA budget.
Also in Azerbaijan and Georgia initiatives were taken to remove inefficiencies in eligibility criteria and to improve the calculation schemes for the poorer parts of the population. In Georgia the main part in the pension that was addressed relates to disability. Since September 2015 old age pensions and the social package for disabled persons of the I-st (severe) group increased up to GEL 160 and almost reached the existing subsistence minimum level. The gradual growth of pensions affects the poverty reduction as well. As indicated in UNICEF‘s researches, raise of pensions caused reduction of extreme poverty of children, from 9.4% to 7.7%.
In “The former Yugoslav Republic of Macedonia” the main measure in the pension field was to make some adjustment in the benefits. The adjustments will be made by increasing the individuals’ pensions by a fix sum which will be calculated when the total amount of funds for pensions increased by 5% will be divided by the total number of pension beneficiaries in September 2016.
Also in Serbia it was decided after many years of freezing the (indexation of the) pension amounts, to allow an increase of 1.25% in December 2015 due to the improved financial situation.
Furthermore, by the Government Conclusion brought in October 2015, the problem of non-adjustment of pensions to military pensioners was solved. Pensions of this category have been adjusted since November 2015, and it has been foreseen to make a payment to cover the difference occurred due to non-adjustment of the pensions in the period between January 2008 and October 2015.
In March 2016 the Government corrected the negative consequences of the phasing out of the early retirement pensions for persons who are subject of a collective redundancy. These category of persons faced a problem when the conditions for retirement changed in 2015. Because of the expiry of the deadline for receiving monetary compensation, these persons entitled to early old age pension received a reduced amount of that pension. These pensioners should receive thus the difference between the amount of the old age pension they would realize by applying the regulation on pension and disability insurance (which was valid at the moment of realizing right on special monetary compensation) and the amount of realized early old age pension.
In Georgia significant changes have been made in the “Labour Code” regarding maternity. Since January 2014 pregnant mothers can take a leave for 730 calendar days (instead of 140 days), out of which 183 days (instead of 126) are payable. In the case of a complicated or multiple birth or in case of premature childbirth (before the 26th week of pregnancy) the days amount to 200 (payable) calendar days (instead of 140). At the same time, the amount of the basic cash benefit for pregnancy and childbirth has increased from 600 GEL up to 1000 GEL.
Also in “The former Yugoslav Republic of Macedonia” the protection in case of maternity has been improved. A better protection is granted to women employed under a contract for a definite time, which expires while they are being paid salary compensation during the pregnancy, childbirth or parental leave. These women shall continue to exercise the right until the end date of the leave. The costs of the leave will be borne by the Health Insurance Fund.
Furthermore, outside of the scope of maternity, the procedures for granting subsidies and various types of support under the scheme for occupational rehabilitation and employment of people with invalidity were improved. These improvements refer to a better outline of the competences of the committee dealing with these matters as well as with the establishment of more clear deadlines in the procedure. The distribution of funds for employment of people with invalidity is decided now by a Steering Committee of the Special Fund with the Employment Service Agency. The assessment of disability/invalidity as a precondition for claiming support is done by branch offices of the Pension and Disability Fund on the basis of the findings of its Committee for assessment of the working capacity. The Committee for assessment of the working capacity must issue now its findings within 30 days from the receipt of the claim, while the Pension and Disability Fund must decide within 45 days. The steering Committee of the Special Fund is expected to decide on granting the support (subsidy for employment, grant for adaptation of the space or equipment) within 90 days from the receipt of the claim.
In Albania for the first time the Health Fund can now allow the purchase of health services through health service packages. Five health care packages were approved. These packages will be offered in the public health system, unless the needs that are requested are not fulfilled, then it will be contracted in the private sector. The fund will finance the price of the packages equally in public health institutions as well as in the private ones. The insured persons benefiting from these packages are exempted from mutual payments.
Furthermore a national control base program (check-up) has been introduced in the health care systems. All citizens aged 40-65 years old, with a permanent residence in the Republic of Albania, will benefit – free of charge – from a basic control package, which includes visiting the family doctor and pursuing life style factors, physiological parameters and laboratory examinations.
In Georgia the focus has been on the launch of a new hepatitis C elimination program. In the framework of the program all citizens are provided with a new anti-retroviral therapy and with diagnostics (before the treatment initiation as well as during the treatment monitoring process) Cost of medications provided by the component is fully funded by the program.
Reforms to improve the quality of health care services have been continued as well in “The former Yugoslav Republic of Macedonia”. These include:
A further upgrade of the system “my term” for electronic referral and scheduling of examinations and interventions. Namely, in addition to the personal doctors, specialist doctors must also use the electronic system to refer the patients for further specialist examinations, controls, surgeries or examinations with specific medical equipment.
More investments in the human resource development in the health sector have been materialized through continuous trainings and professional development as well as through the financial support of the education of physicians and other medical personnel in health institutions abroad, particularly in countries from the European Union and the United States of America.
Finally the procurement of new medical equipment, renovations, reconstructions and constructions of health institutions has modernized.
In Turkey a comprehensive system of barcode matching has been introduced. It starts from the medical devices list included in the Health Application Notification (SUT) as this is the basis for reimbursing medical devices. To create a common application standard among the social security institutions, companies and health service providers, a project was initiated to maintain a correct and proper invoicing of medical devices that are used by medical service providers in the treatment of insured persons.
Companies enter the information in the system, the infrastructure of which is implemented by the General Directorate of Service Provision, including the SUT code to which their products are related. Within this scope, 996,565 products are matched with approximately 4,000 SUT codes. This match-up information is defined in the MEDULA database. As a result of the project, medical devices will be classified according to a level and standard for medical device usage according to the appropriate medical devices SUT code.
In Armenia the operation of 19 "One stop shop" territorial centers of complex social services (TCCSS) was further continued in 2015. These one stop shops are located in renovated and technical highly equipped buildings. Necessary activities are carried out in order to establish 15 more TCCSS. The TCCSS accept the applications in an integrated reception and possess an integrated electronic document management system.
Furthermore the "Strategic Program for protection of Child's Rights in the Republic of Armenia" was further implemented. In particular, activities were carried out for improving the quality of life and ensuring social security guarantees for children in hard living conditions for developing an alternative services network for these children and for improving the quality of services provides in child care and residential institutions. More emphasis is put on alternative care services (caretaker family, daytime centers) so that the load for the general social security institution providing day-and-night care to children in the system can be relieved
In Azerbaijan the level of the assistance benefit, paid to 5.1% of the country’s population, receiving this kind of targeted social assistance from the state, has been improved. More in particular, the average monthly amount has increased as from April 1 by 5.6% to reach 151 AZN. A total now of 84 million AZN has been spent from the state budget for the payment of social benefits, pensions, and compensations. The social program on improving the living conditions of handicapped war veterans and martyr families is also gradually expanding. A total of 104 handicapped war veterans and martyr families have been provided with fully renovated apartments.
In Georgia the emphasis has been put on the further development of the methods and techniques to evaluate socio-economic conditions (i.e. need). Significant changes in the methodology of the evaluation of socio-economic conditions of vulnerable households have been worked out in 2014 and implemented in 2015. This new methodology emphasizes on income and expenses of a household, rather than on property and home appliances. Moreover, this methodology reflects more adequately the needs of household members (disabled persons, persons suffering with chronic disease, children, pensioners etc.). As a result, accuracy of the methodology and targeting of social assistance has been significantly increased.
Furthermore the process of deinstitutionalization and development of community based services is continued. It does not include anymore only children but is focusing now as well upon the disabled and the elderly.
The important novelty is the launch of a state program aiming at providing appropriate services for children working and/or living in the streets. In order to identify, evaluate and assist children/families living and/or working in streets, four mobile groups were set up, four day care and four shelters were established.
In “The former Yugoslav Republic of Macedonia” the minimum support programs were not subject to fundamental changes, apart from the indexation of the benefits rates. More specifically, the amendments to the Law on Social Protection ensured an increase of the amount of social financial assistance and permanent financial assistance by 5%; the payment of the increased amount of these benefits will start on 1 July 2016.
During the last year, the Parliament of Montenegro, has adopted an amendment to the Law on Social and Child Protection, and included in this system two new rights: financial compensation for parents/guardians who take care of a disabled person and “parental leave” for women.
The first benefit grans financial compensation for one of the parents or guardians who take care of a person recipient of a personal disability allowance regardless of employment or pension status. The amount is 193 euro per month.
The second benefit is a monthly compensation that is given to women who gave birth to three or more children. It amounts to 70% of the average net salary in Montenegro (earned in the year proceeding the year of exercising this right). This right shall be acquired by a woman who gave birth to three children and has completed at least 25 years of service, or a woman who gave birth to four or more children and achieve at least 15 years of service. This right may not be used within the employment and excludes the possibility of simultaneous use of pension rights. Also, women who gave birth to three or more children are entitled to a monthly compensation of 40% of the average net salary in Montenegro (in the year proceeding the year of exercising this right), if they are on evidence of Employment Agency for at least 15 years.
In Turkey a new project “Supporting the Registered Employment of Women through Home-based Child-care Services” has been started to get implementation. The project mainly promotes the registered employment of women by 1) facilitating the integration into the labour market of women with small children who are at risk of dropping out from the labour market and 2) by supporting the formal work of women who provide home-based child-care services.
The project supports mothers with small children in targeted provinces who employ a child caregiver and who return to work by granting them €300 for a period of up to 24 months. It has been implemented in Antalya, Bursa and İzmir provinces which were chosen according to mainly socio-economic development levels and the number of insured women in those provinces.
The target groups are women with children up to two years of age who are working or about to start/return to working in a registered job and also women providing or about to start providing home-based child care services as a registered job.
The operation increases labour force participation and the registered employment of women, especially among vulnerable groups such as domestic workers and women returning to work.