1 SOCIAL SECURITY & THE NATIONAL ECONOMY CHAPTER SIX 6 SOCIAL SECURITY & ECONOMIC DEVELOPMENT

2 CHAPTER OUTLINE The impact of social security towards the – economic and social development, –and the relationship to the consumption, –production, –investment, –savings and the issues behind it SOCIAL SECURITY & ECONOMIC DEVELOPMENT

3 6.1 SOCIAL SECURITY AND ECONOMIC DEVELOPMENT The issue in social security may affect in various aspect in the national economy or economic development. It can be seen from two areas as such: SOCIAL SECURITY & ECONOMIC DEVELOPMENT

4 Social security and economic development… Improving the quality of life The good implementation of social security programmes within the country may improve the quality of life of the citizens especially in financial issue. SOCIAL SECURITY & ECONOMIC DEVELOPMENT

5 Social security and economic development… Reducing of government’s burden If the social security is improved, the government expenditure may also be reduced through reducing the allocation of money, subsidies and welfare expenditure. The privatization of certain programmes also leads to the reducing of government’s responsibility in social security. SOCIAL SECURITY & ECONOMIC DEVELOPMENT

6 6.2 SOCIAL SECURITY AND SOCIAL DEVELOPMENT The social condition of country may also be affected by the social security system applied within the country. Eg SOCIAL SECURITY & SOCIAL DEVELOPMENT

7 Social security and social development… Improving the quality of life The quality of life in terms of health, span of life, education etc can be improved through proper and total implementation of social security programmes Welfare programmes Social security programmes provide welfare assistance towards the people who are really in needs, and thus may improved social condition of people. SOCIAL SECURITY & SOCIAL DEVELOPMENT

8 6.3 SOCIAL SECURITY AND CONSUMPTIONS The savings made by the contributor can lead to the consumptions in the economic circle. Purchasing power SOCIAL SECURITY & CONSUMPTIONS

9 6.4 SOCIAL SECURITY AND PRODUCTIONS Social security covers in many areas. The employment injury may affect the productions of the organization as well as the country as a whole. Motivational factor SOCIAL SECURITY & PRODUCTIONS

SOCIAL SECURITY AND LABOUR MARKET Labour market is affected by social security through the incentives provided for the workers especially provided discretionally by the organization. Social protection also needs to be taken into consideration in order to ensure the resource of labour in the market is sufficient to generate the economic growth. Attraction to work SOCIAL SECURITY & LABOUR MARKET

SOCIAL SECURITY AND INVESTMENT Social security programmes promote the investment among the public through the social insurance or private insurance programmes. The fund accumulated through some social security organization may become as the investment sources by the government to gain revenue. SOCIAL SECURITY & INVESTMENT

SOCIAL SECURITY AND SAVINGS Social security programmes also promotes public to saving for old-age. The funds accumulated for financing social security may also become a savings for the government SOCIAL SECURITY & SAVINGS

ROLE OF GOVERNMENT IN SOCIAL SECURITY There are several roles played by the government in order to secure the social security programs: ROLE OF GOVERNMENT IN SOCIAL SECURITY

14 Role of government in social security… As the policy maker –As the government holds the supreme power within the country, which is the policy formulator through the legislative body, the government needs to keep abreast with the current situation to meet current needs. ROLE OF GOVERNMENT IN SOCIAL SECURITY

15 Role of government in social security… As the enforcer –The government also indirectly can become an enforcer through the time-to-time observation towards the implementation of policies ROLE OF GOVERNMENT IN SOCIAL SECURITY

16 Role of government in social security… As the mediator Under the ILO concept of tripartite, government plays their role as a mediator in international convention to bring the issues related to social security or social protection. Government also as a mediator in handling the dispute between the employees, employers and NGO to achieve the mutual consent in social protection issues ROLE OF GOVERNMENT IN SOCIAL SECURITY

TRENDS AND ISSUES Social security gives a big impact towards the national socio-economic within one country. The rising of cost, the enforcement of laws and regulations, new development of social security measures, may lead to the effectiveness and efficiency of the social security in Malaysia. TRENDS & ISSUES

18 Trends and issues… Cost cutting measures –Throughout the years, there are some programmes of social protection in Malaysia has been amended in order to cut the cost faced by the social security organization. –Question. Is the cost cutting measures affect coverage of the assistance or protection in social security? TRENDS & ISSUES

19 Trends and issues… Privatization –Initially, all the social security organizations are under the government control. Due to the development of economic trend and political administration, they are privatized with minimum control by the government. –Question. Is the privatization lead to the effectiveness of social security programmes? TRENDS & ISSUES

20 Trends and issues… Stricter qualifying conditions –The qualifying conditions of certain programmes become stricter compared to early years of the development of social security organizations. –Question. Is this action needed and helps for the efficiency and effectiveness of social security? TRENDS & ISSUES

21 Trends and issues… Private insurance –Government nowadays is move towards the promotion of having private insurance among the public. –Question. Effective of vice versa? TRENDS & ISSUES

22 TUTORIAL Discuss the recent issues regarding this topic. Outline the important points of each facets. Discuss the other roles of government in social security administration and programmes. TUTORIAL