SOCIAL SECURITY
COVERAGE AND
BENEFITS
CHAPTER
3
THREE
1
Objectives of the lecture:

After completing this lecture, the students
should be able to:
 Describe
the aims and ideals
 Describe the coverage – diversity and inequality
 Identifying the qualifying conditions
 Determining level and scope of benefits
 Understand the concept of indexation of benefits
 Analyze trends and issues
2
Social Security Coverage & Benefits


To give individuals and families the confidence that their
level of living and quality of life will not, in so far possible,
be greatly eroded by any social or economic eventuality.

preventing risks from arising in the first place, and helping
individuals and families to make the best possible
adjustment when faced with disabilities and disadvantages
which have not been or could not be prevented

It provides a floor of protection for all participants against
financial losses caused by premature death, poor health,
disability or old age

Provide significant source of funds to finance economic
development.
3
Social Security Coverage & Benefits
3.1 : AIMS AND IDEALS OF SOCIAL
SECURITY (SOCIAL INSURANCE)

The general principle of social security coverage is it should
extend protection to the whole community

It may cover all persons, all workers, except those in certain
occupations, only workers with a minimum period of services, or
some other group (requires qualifying conditions).

However, how a person is eligible for the benefits of the social
security program is basically determined by certain requirements.

Issues in coverage :


Identification
Concentration on the employed sector
 Higher paid employees
 Government workers
4
Social Security Coverage & Benefits
3.2 : COVERAGE – DIVERSITY AND
INEQUALITY

Social security (public assistance) program covers all
persons, but the benefits are paid only to those individual
who can demonstrate need. The amount of benefits is
paid based on the extent of demonstrated need.

Eg:
 Child benefit (UK): Coverage must be child under age
16, 25 weeks residence in UK in last 52 weeks.
 Widowed-mothers allowance (UK): for widows with at
least one dependent child under age 19 for whom they
get Child Benefit.
 Malaysia – allowance for poor and old people
5
Social Security Coverage & Benefits
Cont…

Social security (insurance) program covers all persons but
they must satisfy certain eligibility requirements.

Eg:
 Provident fund: mandatory coverage for private sector
employees, non-pensionable public sector employees
and foreign workers. Voluntary coverage for domestic
workers, self employed, and pensionable public sector
employees.
6
Social Security Coverage & Benefits
Cont…


Certain conditions to be met before benefits can be
awarded
3 aspects to be considered:



Proof of the contingency
Claimant is properly within the coverage
Various conditions are fulfilled

The qualifying conditions of social security whether in
social Insurance or public assistance is depend on the
types of schemes as well the individual who claims the
benefit(s).

It may differ from one scheme to another or one country to
the other country.
7
Social Security Coverage & Benefits
3.3 : QUALIFYING CONDITIONS

Public assistance


Relate to the status of nationality, means test etc
Social insurance


Based from the record of contribution
i.e Old age benefits

He / she must be a contributor (EPF)
Age 55/56/58
Service Pension Scheme
-
When public employees reach retirement age of
55/56 or optional ie 50 for male and 45 for
female
Or medically certified an unfit to work due to
accident or disease
8
Social Security Coverage & Benefits
Cont…

Eg : SOCSO

All qualified employees under the acts should be
registered and make a contributions with SOCSO
regardless of their service status – permanent, temporary,
part-time, probation etc

However there are some group of profession which are
unqualified / not covered under the SOCSO:




public servant
domestic servant
self-employment
foreign workers
9
Social Security Coverage & Benefits
Cont…

Different level of benefits form between states and countries

Based from the socio-economic conditions

There are different scope or level of benefits under different
schemes.

Identified under respective schemes

Guidelines from ILO, Legal provision


Based on proportion of wages
Based on the cost of subsistence
10
Social Security Coverage & Benefits
3.4 : LEVEL AND SCOPE OF BENEFITS
Cont…



EPF
Death withdrawal scheme.
Withdrawal of the funds
 retirement age 55/56/58 (Acc I)
 housing , education (Acc II)
 withdrawal at age of 50 (Acc II)
 for health and medical purpose (Acc II)
11

SOCSO :

Benefits related to the accident due to injuries sustained at
work and invalidity from whatever cause.
 Medical benefit (S 37)
 Dependents benefits (S 22)
 Disablement benefits (S 26)
 Invalidity Pension (S 20)
 Survivor Pension (S 20A)
 Funeral Benefit (S 29)

# However, the level and scope of benefits is still depend
on the qualifying conditions.
12
Social Security Coverage & Benefits
Cont…

How much social security can a country afford
when balancing the vsrous social & economic
considerations involved?

Limited coverage under SOCSO

The awareness and cooperation of the employer

Role of NGO, eg: MTUC submit a proposal to
increase the rate of EPF contribution and SOCSO’s
benefits.

Maintenance of the value of benefits
13
Social Security Coverage & Benefits
3.5 : TRENDS AND ISSUES



Explain any social security benefits in Malaysia.
Analyze any social security issues in Malaysia.
Distinguish the different coverage, qualifying conditions and
level of benefits practiced by our country and other country
14
Social Security Coverage & Benefits
TUTORIAL