1. Assessment of Social Protection Schemes in Thailand: methodology, recommendations, agreed policy options and results of the costing Valerie Schmitt, Social Security Specialist, ILO DWT Bangkok Friday 16 March

2. Structure of the presentation The process & methodology The results: recommendations and costing Next steps

3. In a country with the Social protection floor  All residents have access to essential health care  All children enjoy income security through transfers in cash or kind  access to nutrition, education and care  All those in active age groups who cannot earn sufficient income enjoy a minimum income security (transfer in cash or in kind & employment guarantee schemes)  All residents in old age and with disabilities have income security through pensions or transfers in kind

4. The Assessment = is the SPF a reality? Full achievement of the SPF !!  Still some gaps  recommendations to reach the full accomplishment of the SPF

5. The assessment tells us 1. What is the situation? 2. How far are we from the SPF? 3. What should we do to achieve the SPF? For each guarantee of the SPF we describe existing schemes, laws, regulations We compare what exists with the SPF framework Has all the population access to health care and income security? Are the benefits adequate? We draw recommendations and propose new (or extended) social protection provisions

6. The assessment tells us 4. How much will it cost? We calculate the cost of the additional SPF provisions using the RAP protocol and compare with GDP and government budget Beyond the assessment 5. How to finance the new SPF provisions? We complete the assessment with recommendations to increase the fiscal space 6. What will be the return on investment? We complete the assessment with an analysis of the impact of the SPF provisions on poverty

7. The results can be summarized in the Assessment matrix

8. The Assessment has three steps 1.2 Provision of Recommendations STEP 1 – From situation analysis to recommendations JUNJULAUGSEPOCTNOVDECJANFEB MAR 10 Au10 Au 10 August STEP 2 - Costing 2.1 Translation of recommendations into “costable” scenarios 2.2 Data collection (I) on POP, ECO, EAP, parameters for each scenario and projection of the costs using the RAP protocol 2.3 Preliminary results of the costing 1.1 Inventory of schemes, gaps, issues 30 November 2.4 Data collection (II) on GGO, ECO and finalization of the costing 3.1 Writing assessment report 23 February 2.4 Recommendations from CSOs 16 March STEP 3 – Finalization 3.2 Presentation to the Government? X 2.5 Validation workshop

9. Structure of the presentation The process & methodology The results: recommendations and costing Next steps

10. Among the recommendations Qualitative recommendations on the management of existing schemes, review targeting & registration mechanisms, review the law, conduct research, conduct a tax reform… We can use the RAP Protocol Recommendations = Increase benefits or population covered, introduce new benefits We need to conduct complementary studies

11. Assessment of Health care Existing provisionsMain design gapsImplementation issues UCS (76%) SSO (15%) CSMBS (7% population) Compulsory Migrant Health Insurance for registered migrant workers (migrants under MOU or who have completed the National Verification Process are entitled to the SSS) Fragmented systems and laws Dependents are not covered by SSS Vertical inequality (same package UCS-SSS) Undocumented migrant workers are not covered (they represent 2-3 Mo or 5% of the workforce) Inequity in access to ARTs (CSBMS VS UCS) Confidentiality/stigma issues (HIV-AIDS) Exclusion from UCS (ethnic minorities, stateless) because of no ID or lack of information Geographic imbalances: poor availability of HC supply in some area, idem for HIV Exclusion of migrant workers from SSO because of non declaration by employer

12. Assessment of Health care The floor is achieved for Health Care, although implementation issues remain Main recommendations:  Reduce fragmentation (the way the system is organized, financed, regulated)  Improve health care supply, HIV- sensitiveness of the whole system, Long Term care (aging society)  Ensure financial sustainability of the system  Introduce news measures such as the necessity to co-pay for non essential services Future work? HISRO/TDRI proposal to reduce fragmentation, ensure financial sustainability and increase the fiscal space Organizational and legal reviews Feasibility study on long term care (ILO-HISRO collaboration?)

13. Assessment of Health care We consider that the SPF is achieved!! CSMBS SSS Universal coverage scheme (UCS) Pockets of exclusion and lack of access (less than 1.5% of population) Poor - Informal sectorPrivate sector Civil servants

14. Income security for children Existing provisionsMain design gapsImplementation issues Scholarships (civil servants, poor households, social activists) Free education for all (15 years) Child allowance introduced in 1998 for formal workers by Social Security Scheme Free school meals and other support in kind (bicycles…) Around 5-6 million children of informal economy workers do not receive adequate assistance – need to cover e.g. transportation costs Improve services for pre- school children (stimulation of child development) Some children from migrant workers and ethnic communities in remote areas have limited access to education Regional disparities in quality of education, esp. in rural areas Leakages / corruption issues in food distribution Lack of information limiting access to services

15. Income security for children Need to establish a child allowance for all children, improve quality of education and care for pre-school children Main recommendations:  Design and implement a child allowance for all children 0-3, 0-6 or 0-12 years old Future work? Costing of the Child allowance using the RAP protocol (and NESDB demographic data) Feasibility study for the design and implementation of the Child allowance once the idea is endorsed  Add a family benefit under Benefit package for Article 40  Provide systematic financial/in kind support to poor students & children (and not ad hoc)  Improve the quality of the services (education, child care, services for mothers and children)

16. Income security for children: A universal child allowance Scholarships 400 baht gap!! Still a huge gap!! Universal child allowance : 400 - 500 baht for all children 0-3, 0-6 or 0-12Recommendation: Poor - Informal sectorPrivate sector Civil servants

17. Income security for working age Existing provisionsMain design gapsImplementation issues Voluntary Insurance (art. 39): Sickness, maternity, invalidity, death, child allowance and old-age pension (432 THB/m) Compulsory insurance (art. 33): Sickness, maternity, invalidity, death, child allowance, old-age pension and unemployment under SSF // work injury under WCF Fragmented schemes  increased admin burden No portability between schemes Some workers are excluded (ex. domestic workers, employees of informal businesses) Package for informal economy workers is not attractive Migrant workers have to leave 7 days after dismissal (no UI) and in case of disability Compliance issues: some employers collect the contributions for SSS but do not register their workers Voluntary Subsidized Insurance (art. 40- IE workers): 2 packages (i) sickness, invalidity, death (ii) Idem + old-age (lump sum)

18. Income security for working age Existing provisionsMain design gapsImplementation issues 500 baht transfer for people with disabilities from MSDHS administered at TAO level and life quality fund (in kind by providing equipment) Ad hoc support 500 baht transfer for people with HIV-AIDS from MoL administered at TAO level Funeral expenditure (MSDHS) 2,000 Baths up to 3 times a year (on demand) - implemented by MSDHS Ad hoc support TVET Migrants excluded Not adapted to market needs Cumulated with 500 Baht old age allowance although both aim at the same purpose (income replacement in case people are no longer able to work)

19. Main recommendations:  Review social assistance schemes in place to ensure income support to inf. eco. workers  Review existing schemes (Art 33 and 40) in order to cover more people, with more adequate benefits (e.g. home workers, domestic workers)  Develop an objective and standardized poverty and vulnerability assessment system Future work? Design combined packages including income support and mechanisms to increase employability and/or access to markets  idea of better employment guarantee Income security for working age Reduce exclusions under Art. 33 and 40 - Reduce social evasion Social assistance should be more predictable/less ad hoc Develop a better employment guarantee  Explore linkages between social protection with Employment to ensure graduation Feasibility studies on extension of existing schemes (Art 33 and 40) Awareness raising

20. Government urged to look beyond State employees Income security for working age Risks linked to the individual Employment related risks The world is divided in two: Maternity Sickness Severe disability (80% of invalidity) Low productivity & skills Job mismatch, lack of access to information and markets Seasonality of income, markets fluctuations, natural disasters…

21. Income security for working age A sickness benefit for all IE workers SSS Article 40 & 39 gap!! Still a huge gap!! Poor - Informal sectorPrivate sector Civil servants Article 40 & 39 Recommendation: 200 baht / day in case of inpatient care for all IE workers

22. Income security for working age A disability benefit for all IE workers Inadequacy Inadequacy of benefits!! Art40&39 500 baht per month for all disabled in informal sector Poor - Informal sectorPrivate sector Civil servants Art40&39 + 500 baht per month for all disabled in informal sector Recommendation:

23. Income security for working age A maternity benefit for all IE workers gap!! Still a huge gap!! Poor - Informal sectorPrivate sector Civil servants 3 months at the poverty line for women upon deliveryRecommendation:

24. Income security for working age A better employment guarantee for all Scattered Scattered training programs!! Poor - Informal sectorPrivate sector Civil servants Antipoverty component of 7.8% poor Systematic training component for all (1/5 years)Recommendation:

25. For the working age, a combination of anti- poverty and training Anti- poverty component Increasing productivity component Pre and primary school Lower secondary school Upper secondary school Vocational training Higher education Poor 200 baht/day 20 days 10 daysN/A Non PoorN/A20 days 10 daysN/A One training per five years (20% per year) Cost of training = 550 THB/person/day Income security for working age A better employment guarantee for all

26. Income security for elderly Existing provisionsMain design gapsImplementation issues Voluntary insurance under Art 39 and Art 40 (package 2 – lump sum) Formal sector workers - SSF National Savings Fund (MoF) for Thai Nationals aged 15-60 not benefiting from government or SSF No portability across schemes Art 40: contribution not enough to guarantee income support Schemes with Lump sum: income support not guaranteed No indexation of the social pension in legislation Tax exemption does not benefit the poorest Difficult contribution to NSSF (irregular income) Universal Non contributory 500 THB scheme Civil servants - Government Pension Scheme, Provident Funds for State Owned enter- prises, Private Teacher Aid Fund Implementation of the 500 THB scheme politicized at TAO level Registration under schemes mainly possible in BKK and long admin procedures Ad hoc community volunteer care giver program (MSDHS)

27. Main recommendations:  Increase level of benefits to poverty line (at least) and index benefits  Establish long term care system  holistic care to the elderly  Legislate the 500 THB scheme to ensure predictability Future work? Feasibility study of long term care Income security for elderly  Create a coherent pension system (& portability) and look at tax reform to ensure financial sustainability of the scheme Reform 500 THB scheme : increase level of benefits, legislate Improve coherence and portability between the schemes Look at Long Term care Costing of social pension at level of food poverty line + additional benefits depending on level of dependency

28. 500 baht Pension for the elderly SSS Art40&39 NSF Inadequacy Inadequacy of benefits!! Indexed 600/700/800/1,000 baht Indexed 60%, 70%, 80%, 100% of poverty line SSS Art40&39 NSFRecommendation:

29. 1- Data collection 2- Calculation of the cost in 2011 of each scenario, Projection over the years of this cost, in THB, % Govt revenue and % GDP Costing of the recommendations

30. Cost of the “Low” combined scenario BENEFIT SCHEME (million THB) 20122014201620182020 Children Universal Child Allowance for all children aged 0-3 (TBH 400/month) 7,69817,30617,79118,36318,984 Working age population Maternity Allowance for all informal working women (Poverty line*3) 8821,9302,1042,2882,473 Sickness benefit for all informal workers (THB 200/day) 1,4003,4464,2455,0466,052 Skills development 51,06354,45557,98461,60865,109 Disability allowance 218240262285307 Elderly Pension: New government policy with indexation 56,75771,37984,89798,534111,312 Total 118,018148,756167,283186,125204 237 %GDP 1.0% 1.1%1.0%0.9% %Government revenue 5.3%5.4%5.1%4.8%4.5%

31. Cost of the “High” combined scenario BENEFIT SCHEME (million THB) 20122014201620182020 Children Universal Child Allowance for all children aged 0-12 (500 THB/month) 34,32470,01471,95674,81677,625 Working age population Maternity Allowance for all informal working women (Poverty line*3) 8821,9302,1042,2882,473 Sickness benefit for all informal workers (THB 200/day) 1,4003,4464,2455,0466,052 Skills development 51,06354,45557,98461,60865,109 Disability allowance 218240262285307 ElderlyPension: % of poverty line 101,524127,679151,860176,252199,110 Total 189,412257,764288,411320,296350,675 %GDP 1.6%1.8%1.7% 1.6% %Government revenue 8.5%9.3%8.7%8.3%7.7%

32. Costing of the low & high scenarios 0.9% GDP 1.6% GDP

33. Take away message The Assessment exercise – Provides a snapshot of what exist for each of the four guarantees of the SPF – Identifies gaps and issues for each guarantee – Leads to the formulation of some policy recommendations – what should we do to improve the situation and complete the social protection floor? To push these recommendations we need to know: – (1) how much they cost? – (2) what will be their impact (on poverty, employment…)? – (3) where we will find the money? The RAP protocol can help us answering the first question (for some simple recommendations – not all of them)

34. Structure of the presentation The process & methodology The results: recommendations and costing Next steps

35. How to finance the SPF? 1- How to finance? Contributions? Additional taxes? Many different types of taxes (+/- progressive) – A question for the Fiscal policy office of the Ministry of Finance, for TDRI… but also for the national commissions… 2- What will be the return on investment? – Impact on poverty reduction, reduction of inequalities, social inclusion, access to employment, increase in productivity

36. How to hand over to the government? 1- Role of NESDB? Role of the strategic commission on informal sector? Parliament and Senate? Assessment report & RAP protocol Assessment team UN SPF Team Ministries (MSDHS, MoL, MoH, MoE, MoF…) CSOs HISRO & TDRI Government (via the strategic committee on informal sector?) NESDB Ministries (MSDHS, MoL, MoH, MoE, MoF…) CSOs HISRO & TDRI

37. Reducing costs by sharing admin functions & information Case management = adapted services/benefits ; Single entry point = facilitates access to services ; Possibility of combined benefit packages responding to several objectives and with higher impact on poverty reduction Monitoring the extension of SP coverage at central level and assessing the impact Coordinating policy making, avoiding overlaps Representing the interests of the beneficiaries, ensuring that the SPF is a reality MoHMoEMoLMoIMSDHS … OBOTO? Cooperatives? CSOs? Coordination (e.g. committee on informal sector) How to coordinate policies & implementation?