Module 15: Social protection
and the social contract
ILO, 2013
Key questions
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What is a social contract?
Why is there a need for a contract?
What is the origin of the social contract?
What is the role of ideologies in influencing social policies?
What is the role of religion in influencing our vision of society
and social protection?
What other factors influence social protection policies?
What is a welfare state?
What are experiences from different countries?
What is the basis for social contracts in different countries?
Social contract
• Social contract is an implicit contract or agreement on how
to live together in a society
• It defines rights and duties of all parties, e.g. people pay
taxes, government provides public services financed from
taxes
• It may be established within a family, within a community,
between the government and the governed
• Includes social policies and taxes
• Definition of rights and duties must evolve over time
• The ABND is built upon a national dialogue process, and
thus the vision of society and social contract are reflected
in the ABND recommendations
Need for a contract
• It starts with the origin of society, i.e. the state of nature
• State of nature is human life without any political or social
order
• In Thomas Hobbes’s state of nature, human beings are
perfectly free and equal, i.e. anyone can kill anyone
• Result: Life is “a war of all against all”
• Humans could not improve their lives or perform productive
activities as they were busy defending themselves
• There was need for a mutual agreement
Origin of social contract
• Humans created an agreement to live in society
• Social contract: ruler protects the people, people have to
give up some individual rights
• People gain security and civil liberties
• It is a choice between total freedom and security
Origin of social contract
• According to Jean-Jacques Rousseau,
society is not abdication of freedom
• People lose their natural liberty, but gain
civil and moral liberty
• He says of moral freedom, “obedience to
the law that one prescribes for oneself is
freedom“ as we do no more than obey
ourselves
Role of ideologies in influencing social
policies
Ideology
Aims
Role of
Government
Best means of
distribution
Libertarian
Individual
liberty
Minimum State
intervention,
austere welfare state
Private market
Liberal
Maximize total
utility of
people,
social justice
(Rawls)
Moderate
redistributive role of
State, to serve
society’s goals
Mixed economy
i.e. private market
moderated by
State intervention
Socialist
Equality,
freedom,
fraternity
Significant
redistributive role of
State
Mixed economy
(Democratic) /
State intervention
(Marxists)
Role of ideologies in influencing social
policies
• Ideologies influence the design of social policies
• E.g. Barack Obama’s Healthcare Reform, 2010 sought
compulsory universal healthcare coverage and payment of
fine if a person does not have medical insurance
• Ideological split between proponents of universal coverage
and Republicans who declared this as an “infringement on
the rights of individuals”
Role of religion
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Religion is a chief factor influencing how people view society
However, all religions advocate similar principles regarding
solidarity and mutual help
Buddhism -> interdependence, mutual protection
Buddha’s famous discourse about 2 acrobats:
“By protecting others, one protects oneself“
Role of religion
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Confucianism -> altruism: “Welfare of the society above the
individual”
Islam -> charity: “Zakat” to share 2.5% of one’s wealth
But, global influence in recent years has diluted religious
feelings, cultural and family relations
Other influencing factors
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Singapore has a pragmatic culture
Limited role of government and religion in social protection
Compulsory savings by individuals
2008 economic crisis focused global attention on social
protection
• Availability of fiscal space -> universal vs. targeted,
contributory vs. non- contributory?
• Lack of awareness on the necessity for social contributions
impacts successful implementation of contributory social
insurance schemes
Welfare state
• Idea of welfare state started gaining momentum in
developing countries in 1980s
• Welfare state supports the poor and allows income
redistribution
• An exchange: rich groups taxed more, State protects people
• Protecting the poor indirectly protects the rich
• With more skills and better health, the poor can contribute
more effectively to the nation’s development
Experiences from countries
Thailand
• Important role of monarchy
in society
• Mix of policies
 Universal coverage
guaranteeing a minimum
level of benefits to all
e.g. Universal Healthcare
Coverage Scheme
 Targeted schemes for specific vulnerabilities e.g. Noncontributory allowance schemes for the elderly, disabled
and people with HIV-AIDS
Experiences from countries
Indonesia
• Social security law, 2004 and Constitution provide for social
security to all
• Lack of resources has slowed implementation
• It is considered unaffordable to pay for the non-poor ->
universal coverage not a popular idea
• Focus is on income redistribution between the rich and poor,
with little focus on middle class
• Rights-based approach still to gain momentum
Basis for social contract in countries
• Freedom vs. equality in designing social policies
• Universal vs. targeted schemes?
• Voluntary vs. compulsory schemes?
• Other factors that shape people’s vision of society and social
protection?