Presentation on theme: "Social Assistance Pilots Program SA Pilots Seminar Social electronic cards: International experience Viachaslau Herasimovich CASE Ukraine March, 2010."— Presentation transcript:
Social Assistance Pilots Program SA Pilots Seminar Social electronic cards: International experience Viachaslau Herasimovich CASE Ukraine March, 2010
1.Kinds of electronic social cards. Their advantages and disadvantages 2.Example of advanced technologies application in the U.S.A. 3.Social card of Moscow resident 4.Comparison of Odessa and Moscow projects 5.Conclusions. Recommendations 1 Content Content
1 Kinds of electronic cards used in the system of social protection Bank cards. Currently being introduced in developing countries and accepted in developed countries as given. They are used to deliver monetized benefits and help to protect entitled beneficiaries from theft. Discount Cards. Used to deliver non-monetized privileges usually in transportation and allow controlling of who is benefiting from privileges. Used all over the developed world. Smart Cards. Rather sophisticated way of delivering monetized or non-monetized benefits and most importantly of controling the usage of funds. Best examples can be found in the USA and Moscow.
Bank cards Source: Finance Ministry of Ukraine 6 AdvantagesDrawbacks Simplify and reduce the cost of assistance delivery (savings on administration) Elderly population, is not necessarily technically savvy and may have difficulty performing transactions Protect the receiver from theft and loss of funds Offer freedom of movement to the recipient Increase volume of non-cash transactions
Discount cards Source: Finance Ministry of Ukraine AdvantagesDrawbacks Provide significantly better protection against fraud Expensive to implement Facilitate creation of a register of beneficiaries Difficulty of coordination between local and central budget Enable to track the number of discounted and free journeys Possible discrimination by place of residence Monitor the flow of passengers Mostly used in provision of transportation privileges. Discount cards enable the eligible passengers to have either free access to the public transport system and to pay less for their journeys.
1 Examples of implementation of transport discount cards United Kingdom, USA – transport privileges are paid by city councils. Local budget / City travel Russia, Baltic states, Germany – beneficiaries are eligible for privileged travel in their districts of residence only. Central budget / City travel Ireland, France– compensation goes from central budget to service- providers; Mini-states (Hong Kong, Taiwan ) – central budget same as local. Central budget / Across country travel
Smart Cards Source: Finance Ministry of Ukraine Not only the amount of available funds are stored in the memory of smart cards but also a list of essential goods, which the recipient can purchase with these funds. Thus, the state both ensures the eligibility for social assistance and controls that this assistance is properly provided.
1 Example of using smart cards in the USA - WIC program. Federal grants to States for supplemental foods Objective is to provide supplemental foods, health. care referrals, and nutrition education for low-income eligible who are found to be at nutritional risk. Total number of beneficiaries is 8.7 million. Funding in 2008 – USD 6.2 billion.
1 Conditions for successful smart cards implementation on example of WIC program Participation of large retailers with a network of stores which are able to accept the benefit smart card Awareness and acceptance of the rules by both the assistance recipients and its providers Investments into building a suitable future proof smart card infrastructure Focus on long-term goals
1 Social card of the Moscow resident Name, Benefits category Bar code - discounts in trade Contactless chip: Public transport Magnetic stripe: Banking application Card number, date of issue Photo Social card of the Moscow resident – is a personal (named) plastic card with photo, magnetic stripe and microchip, which is issued to a resident of Moscow having the right to receive social assistance.
1 Social card of the Moscow resident The actual registration of volume and quality of granted privileges Passenger flow monitoring Ability to get detailed report on all aspects of transport functioning and provision of benefits Automatic bank transfer of funds Provision of social benefits in trade Payments and discounts for medical services Collecting of personal information from the Social Register and other information systems
1 Social card of the Moscow citizen. Purposes and participants Project Participants: Moscow Committee for Social Security Moscow Underground Moscow Railway Moscow Compulsory Medical Insurance Fund Department of Economic Policy and Development Department of Consumer Market and Services of the Moscow Government Bank of Moscow Visa Payments System State Enterprise Moscow social register Objectives: regulate the delivery of social benefits to Moscow citizens - registration and targeted provision of social support provide full control and accounting transparency of financial flows and control over the targeted use of budgetary funds in the field of social welfare create a common electronic register to track down state benefit recipients monitor the compensation of expenses to organisations that provide privileges simplify budget preparation, analysis and forecasting of budget expenditures based on actual services consumption.
1 Social card of the Odessa resident Introduced 1 April 2008 Eligible : Multi-children families Disabled of 1 st group Pensioners getting minimum pension Help provided Discounts for bread Hot food Medicines allowances Housing and utilities benefits
Comparison of Odessa and Moscow projects MoscowOdessa Funding sourceLocal and centralLocal Number of potential beneficiaries 5 million60,000 Funding, 2008 RUR 20 billion (UAH 5.3 billion) UAH 40 million Functions integrationMultipurpose useSubsidies on food, medicines, housing and utilities services Payment systemVisa International Service Association VISA National system of mass electronic payments (NSMEP)
Trade off between simplicity and effectiveness 1 Integration of functions Storage of personal information on the card Connection to the bank account Costs distribution amongst partners Cardholders awareness Security, data protection Simple procedure of issue and support Accessibility and convenience of services Card ownership Different requests to security Effectiveness RequirementsIssues that challenge simplicity
1 Conclusions. Recommendations Electronic social cards may be successfully introduced at both local and national level. While providing transportation benefits through electronic cards is crucial for effectiveness and success of their introduction at local level, significant value and variety of benefits provided through one card becomes important when the card is introduced across the country. To increase attractiveness of SEC, cooperation of several benefit-providers with reliable processing system and other entities involved would be required. A separate analysis will be needed to analyse technical particularities of SEC introduction as well as to evaluate costs and benefits of it. Due to little experience of electronic cards usage among vulnerable groups of population in Ukraine, cardholders awareness may become a major issue, which may require well prepared information campaign.