social protection assessment based national dialogue in ... · jamkesmas & additional % through...
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Social Protection Assessment
Based National Dialogue in
Indonesia: Existing schemes, gaps,
recommendations and scenarios
Jakarta, 13 December 2011
Sinta Satriana
“Official” Coverage
< 1% of informal economy covered by
Jamsostek pilot program Jamkesmas and Jamkesda: 100% poor & near poor covered
Informal economy
Near poor & Poor Civil serv Private sector
100% of civil servants / police / military & families
One third
One third
Jamsostek: 18% of private sector employees
Health
Formal Economy
two third
50% of the poor through Jamkesmas & additional % through Jamkesda
Jamkesmas & Jamkesda,
100% of the civil servants / police / military & families through Askes
18% of private sector employees covered
Real coverage
Jamsostek for informal Economy
Near poor & Poor Civil serv
Private sector
One third
One third
Formal Economy
Health
Informal economy
two third
Coverage mandated by Law 40/2004: 100%
Non-poor informal economy
Near poor, Poor, disabled, unemployed
Health
Formal Economy
Contribution paid by the government
Contribution paid by workers, in nominal
amount
Contribution paid by workers&employers, in
% of salary
Health
Main gaps and implementation Issues:
• Non poor informal economy workers and their families not covered
• Low coverage in the private sector, desoite mandatory participation
• Targeting issues lack data on beneficiaries and utilization of Jamkesmas
• Unclear benefit package in Jamkesmas leading to unanticipated out-of-pocket payments
• Exclusion of diseases such as HIV and cancer
Main Recommendation • Develop a specific benefit package for the Jamkesmas program and Improve
database system
• Improve linkages with Health Care supply (reception of patients, payment system of the hospitals…)
• Increase enforcement of Jamsostek Law in the private sector
• Increase coverage of Informal Economy workers through the design of adapted enrolment & contribution mechanisms, a mapping of IE workers, the expansion of Jamkesmas to a larger population, the development of regulations to implement Law #40, 2004, etc.
•Extension of Jamkesmas to the uncovered poor due to mis-targeting (Current Jamkesmas cost assumption) •Inclusion of HIV treatments and checkups for all active age population •Introduction of a universal package to reduce Mother to Child HIV Transmission
Non-por Informal Near poor & Poor Civil serv Private sector
One third One third One third
Low Scenario:
Costing Exercise
Costs 0.27% of GDP b 2020
•Health care for all informal economy population, higher level of benefits based on WHO’s report of the Commission on Macroeconomics and health (USD 49, 2011 price) •Inclusion of HIV treatments and checkups for all the population •Introduction of a universal package to reduce Mother to Child HIV Transmission
High Scenario:
Costing Exercise
Costs 0.76% of GDP by 2020
Informal economy
Near poor & Poor Private sector
One third
One third
Formal Economy
two third
Civil serv
Universal coverage of BOS
Small child allowances for civil servants
The “official” coverage
4.1 million very poor students receive scholarships
Raskin
17% of the poor HH covered by PKH PKSA
Children
Informal economy
Near poor & Poor Private sector
One third
One third
Formal Economy
two third
Civil serv
Universal coverage of BOS
Informal economy Near poor & Poor Civil serv Private sector
Low family allowances for civil servants
scholarships
Raskin
17% of the poor HH covered by PKH PKSA
Raskin and Scholarships have targeting errors
The “real” coverage
Children
Children Gaps and Implementation Issues: • Limited coverage area of the PKH program
• Insufficient supply of health and education services to ensure fulfillment of the PKH conditionalities
• Lack of reliable data and efficient targeting mechanisms
• Despite BOS allocation, schools still apply extra fees in practice
• Unclear targeting mechanism of the Scholarship for the poor program
Main recommendation • Extend the coverage of the PKH and scholarship programs, and calculate the
corresponding costs
• Explore the possibility of introducing a universal child allowance, and calculate the corresponding cost
• Increase availability of Schools and Health care services in remote areas
• Develop more linkages between access to health, nutrition and education
• Improve targeting and data collection under all programs
• Reduce administrative costs of Raskin
• Explore the merger of PKH and Scholarship program to avoid duplication
Universal coverage of BOS
Informal economy Near poor & Poor Civil serv Private sector
Low family allowances for civil servants
scholarships
Raskin
PKH
PKSA
Children
Extension of the PKH program to all poor households (and not only the very poor households)
Low Scenario
Will cost 0.05% of GDP by 2020
Informal economy Near poor & Poor Civil serv Private sector
One third One third One third
Universal child allowance (400,000 IDR/year, 2011 price)
Children
High Scenario
Universal child allowance
Will cost 0.2% of GDP by 2020
If the legislation was enforced the total private sector would be covered
Jamsostek pilot program for informal
(injury & death): <1% Scattered interventions
(Asekesos, PNPM, KUR, BLK, …)
100% of the civil servants / police / military
33% of private sector covered in work injury, sickness& death
Current coverage
Working Age
Informal economy
Near poor & Poor Private sector
One third
One third
Formal Economy
two third
Civil serv
Coverage mandated by Law 40/2004: 100%
Informal economy
Working age
Formal Economy
Contribution paid by workers, in nominal
amount
Contribution paid by workers & employers,
in % of salary
Working Age
Main Gaps and Implementation Issues • Almost no income security measures for informal economy workers and
extension of the Jamsostek pilot scheme is very slow
• Limited coverage of formal sector workers due to high evasion
• Severance pay provides insufficient protection compared to unemployment insurance
• Lack of harmonization of the maternity benefits for formal employees
• Low coverage and low level of protection under the Askesos program
• The provision of income security benefits is rarely linked with measures to increase employability, facilitate job creation or return to employment
Working Age
Main Recommendation: • Improve enforcement of the Labor Law to reduce evasion (explore the
TWIN system)
• Feasibility study of an unemployment insurance scheme
• Develop linkages between Public Employment Programs and skills development
• Explore the possible introduction and calculate the cost of a maternity benefit for women in the informal economy
• Design and pilot test a Single Window Service mechanism for workers in the informal economy that would :
• Facilitate their registration and access to social protection and employment services
• Assess their vulnerability and skills needs
• Ensure proper monitoring and evaluation of existing programs
• Enhance coordination between institutions and interventions
Establishment of a public works program linked with vocational training (30 days of work, minimum wage, vocational training)
Minimum income security through
integrated PWP & skills development
Scenario
Working Age
Would cost 0.35% of GDP by 2020
Informal economy
Near poor & Poor Private sector
One third
One third
Formal Economy
two third
Civil serv
< 1% of informal economy covered by
Jamsostek pilot program
Informal economy Near poor & Poor Civil serv Private sector
100% of the civil servants / police / military: Pension and savings
One third One third One third
33% of private sector employees, Jamsostek saving
Old age and disability protection coverage
Nursing home subsidy
Allowance for elderly with no family support (1% of estimated need)
Severe disability allowance
Old age savings, contribution in nominal
amount
Law 40/2004: Old age saving for all workers and periodical pension for formal workers
Old age and disability
Informal economy One third
One third
Formal Economy
two third
Pension and old age savings, contributions in
% of salary
Elderly and Disabled
Main Gaps and Implementation Issues • Almost no income security provisions for the elderly in the informal
economy
• High evasion in the private formal sector
• Old age lump sums do not provide adequate protection
• The sustainability of the unfunded defined-benefit scheme for civil servants is questioned
• The coverage of the non-contributory minimum pension program is limited
• Lack of harmonized definition of disabled people (across Ministries, BPS, etc.)
• Lack of comprehensive and comparable database with a clear classification of the disabled people
Recommendations • Conduct a Feasibility study of a defined benefit pension scheme for
formal sector workers
• Explore the possible extension and calculate the cost of a non-contributory minimum pension scheme for the elderly and people with permanent disabilities
• Create a comprehensive database of disabled people and elderly, to facilitate targeting
• Increase the budget allocation to nursing and other charitable homes
Elderly and Disabled
•Extension of existing non-contributory pension scheme for all severely disabled persons and all vulnerable elderly (i.e. without family support)
Informal economy Near poor & Poor Civil serv Private sector
One third One third One third
Low Scenario:
Allowance for elderly with no family support
Severe disability allowance
would cost 0.09% of GDP by 2020
Universal pension at the level of poverty line
Non-poor Informal Near poor & Poor Civil serv Private sector
One third One third One third
High scenario
Would cost 0.95% of GDP by 2020
