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At the end of the lessons, students should be able:


To explain strategy in developing Islamic welfare
state.
To describe the economics functions of Islamic
welfare state.
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Introduction

Islamic way of life will not be achieved without a
community governed with the tenets of Islam.
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The Qur’an clearly condemns disorder and anarchy (AlBaqarah:205) and the Prophet s.a.w stressed the need
for organisation and authority in Muslim society.
Caliph Umar emphasised that there could be no
organised society without an imam.
Hence, the state is viewed by Islam as an instrumental
to attain al-falah in both spiritual and material.

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Though, the authority of the state is a trust from God
and must be in accordance with shari’ah principle.
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Democratic orientation

Sovereignty, according to Islam, vests in God – it is
only His Will that should prevail in this world.

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Man as vicegerent of God on earth can neither make
nor abrogate the Divine Law.
Hence, once the sovereignty of God is recognised, the
authority for its establishment is vested in the whole
ummah and is to be exercised in the light of the
Qur’an and sunnah through the democratic process of
consultation.
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Welfare commitment

All institutions including the state should reflect the
characteristics of merciful blessings to cater the welfare
of the people.

As stressed by Prophet s.a.w:-
“Any ruler who is responsible for the affairs of the
Muslims but does not strive sincerely for the well-being
will not enter Paradise with them”.

Caliph Umar r.a. wrote to his governor:-
“the best of men in authority is he under whom people
prosper and the worst of them is he under whom
people encounter hardships”.
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Welfare commitment (ctd)

This is in line with the basic objective of shari’ah
which to cater the welfare of the people and reliving
them from hardships.

Need to emphasis that the concept of welfare state is
agreed by a number of Islamic scholars. Amongst
others are Mawardi, Ibn Khaldun, al-Ghazali, alQayyim and Ibn Tamiyyah.
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Strategy of welfare

The concept of welfare in Islam can be neither
exclusively “other-worldly” nor purely “this-worldly”.



There should be balance between material and
spiritual.
According to Islam, negligence of either two aspects of
life will prevent mankind from achieving true welfare.
Hence, the welfare of individuals in an Islamic society
may be realised if there is a proper environment for:-
i.
ii.
fuller realisation of Islamic spiritual values in the individual
as well as in society
adequate fulfillment of all basic needs of life
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i.
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Spiritual uplift
Islamic welfare state must look after the spiritual health of
its people.
The state should bring into reality the moral code of Islam
with its own unique way-free from coercion.
Three major role of the state in uplifting spiritual aspects
are:i.
it should foster conducive conditions for the creation of homes
which would inculcate respects and adherence of Islamic
teaching.
ii.
it must cast educational system in the mould of Islam to produce
societies that imbued with the ideals of Islam.
iii.
it should enforce those norms and values of Islam through legal
enforcement and impose penalty on violators.
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ii.
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Material well-being
Adequate fulfillment of basic material needs is a
priority and necessary in Islam.
Resources are for all mankind for eradicating poverty
and fulfilling the basic material needs such as food,
clothing, shelter, education, transport and etc.
Need to emphasis that it is moral responsibility of the
individual to cater for his own needs through his own
effort and expected to do his best on every job.
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ii.
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Material well-being (ctd)
However, the blind operation of market forces may
not always reward him optimally for his sociallyproductive efforts.
Therefore, the state should play a positive role in
guiding and regulating the economy to ensure that
the objectives of the shari’ah are fulfilled.
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Poverty eradication, full employment and optimum
rate of growth

As a trustee of the God-given resources , it is moral
obligation of the state to use these resources
efficiently.
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Hence, the state is expected to imply the following:i.
ii.
eradicate poverty and fulfill of all basic human needs
provide full and efficient employment to attain an
optimum rate of economic growth and improve the
standard of living of all people
iii. avoiding of conditions generating deficient or excess
demand and leading to unemployment
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Poverty eradication, full employment and optimum
rate of growth (ctd)

In order to achieve the abovementioned function, the
state should play positive role through:i. rational planning.
ii. building the necessary physical and social infrastructure.
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To promote stability in the real value of money

Islamic state must resort to healthy monetary, fiscal
and income policies and appropriate direct control
when necessary.
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For instance, direct control (wage-price control) and
minimize erosion in money value (managed floating in
the currency exchange rate).
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To maintain law and order
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It is the prime determinant of growth and stability of
an economy as well as bring inner happiness of
individual.
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Hence, it is the duty of state to safeguard the life and
property of individual as the Prophet s.a.w says:-
“Whatever a Muslim possess is unlawful for another
Muslim his wealth, property and his life”.
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To ensure social and economic justice
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Islam considers mankind as one family, all members of this
family are alike in the eyes of God as Prophet s.a.w says:-
“Certainly God does not look at your faces or wealth, He
looks at your heart and your deeds”.

Prophet s.a.w also warned of the disastrous consequences
of discrimination and inequality as illustrated in the
following hadith:-
“By God, even if my daughter committed theft, I will
certainly cut her hand”.
“Beware of injustice as it will be equivalent to darkness on
the Day of Judgment”.
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To ensure social and economic justice (ctd)

Therefore, fixation of minimum wages, maximum working
hours, creation of appropriate working conditions,
enforcement of precautionary measures against industrial
hazards, and adoption of technological innovations to reduce
hardships would be fully in conformity with the spirit of
Islamic teaching
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To arrange social security and foster equitable
distribution of income and wealth

Islam emphasis on distributive justice and
incorporates redistribution of income and wealth to
guarantee every individual a standard of living that is
humane and respectable.

In doing so, Islam emphasis the following five
elements:i.
arrangement for training and finding gainful employment
for the unemployed
ii. enforce a just remuneration system
iii. compulsory arrangements for insurance i.e. occupational
hazard and pension/retirement scheme
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To arrange social security and foster equitable
distribution of income and wealth (ctd)
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In doing so, Islam emphasis the following five
elements:iv.
v.
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assistance to the disables, handicaps, orphans and
abandoned old folks
collecting and distributing zakat and enforcing Islamic
law of inheritance
Need to emphasis that Islam allow higher wages for
those who are qualified as a reward of his skills and
capabilities – the concept of equality.
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International relations and ensure national defence
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Islamic state should try to make contribution as it can
towards spiritual and material uplift of mankind.
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This is in line with the principle: to be one, to co-operate in
all matters contributing to “righteousness” and “piety” and
refrain from co-operating in “aggression” and “sin”.
Islam also encourage any constructive move towards peace.
Nonetheless, the Islamic state should do its utmost to
strengthen its defences to protect its faith, territory,
freedom and resources as illustrated in Al-Quran (8:60):-
“…And prepare against them whatever force you can…”.

The military strength of the Islamic state should only be
used for a “just” cause in a “just” manner against those who
nurture to aggressive design as illustrated in
(Al-Baqarah:190)
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i.
The Islamic welfare state and its role in the
economy, Dr. M. Umar Chapra.
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At the end of the lessons, students should be able:


To explain concept of Islamic planning and
development.
To outline the philosophical foundation of planning
and development in Islam.

To identify the essentials features of planning and
development in Islam.

To derive goals of development in Islam.
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
The need for planning is evident from the Qur’anic
verse (87:2-3).
“Praise the name of the Lord the Most High, who
create then dispose; Who measure then, guide”
Islamic planning must take into consideration the
following aspects:i. the whole picture of development and all aspects
of life
ii. in the light of moral values
iii. Hereafter goals
iv. balance between material and spiritual
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Development refers to the process whereby people of a
country utilize the resources available to bring
sustained increase in production of goods and services.
Economic development is a series of economic activities
causing an increase in productivity, average worker and
ratio income to total population.
It is a looked upon as a dynamic process and involves
structural changes in economic, political, religion,
social, cultural and style of living.
Islam emphasis on the human development with the
result that economic development remains an
integrated and indivisible element of the moral and
socio-economic development of human society.
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Tawhid
Tazkiyyah
Philosophical
foundation
Rububiyyah
Khalifah
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i.
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The philosophic foundations of the Islamic approach to
development are as follows:Tawhid
God’s unity and sovereignty.
It lays the rules of God-man and man-man
relationship.

Rububiyyah
Divine arrangement for nourishment, sustenance and
directing things towards their perfection.

God’s power to arrange all the universe.
ii.
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iii.
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Khilafah
Man’s status, role, responsibilities as God vicegerent
on earth.
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Tazkiyah
Purification plus growth.
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It purify man, natural environment, society and state.
iv.
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i.
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ii.
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Comprehensive character including moral, spiritual and
material
The aims is to seek welfare in the world and hereafter.
Development is devoted to the optimization of human
well-being in all dimension.
Focus
The focus of development in Islam is MAN –
development of man and his physical and sociocultural environment.
Hence, it maximize participation of the people at all
levels of decision-making and plan-implementation.
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iii.
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iv.
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Multi-dimensional activity
Involve cooperation between public and private sector.
Islam seeks to establish a balance between the different
factors and forces.
Balance changes
It involves quantitative and qualitative changes.
Example (quantitative): the poverty rate,
unemployment, inflation, rate, gross domestic product
(GDP) etc.
Example (qualitative): quality of life, minimum wage,
safety of the society, ethics and moral application etc.
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v.
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Optimum utilization of resources
Optimum utilization of resources that id has endowed
to man and his physical environment.
Equitable use and distribution and promotion of all
human relationships on the basis on right and justice.
Instilling the value of thankfulness to God and justice
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
i.
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General goals of development policy for Muslim are as
follows:Human resource development
Inculcation of correct attitudes, aspirations,
development of character and personality through
education and training.
Hence, emphasis will be given on expansion and
Islamisation of knowledge (IOK).
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ii.
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Expansion of useful production
Continuous and sustained increase in the national
produce.
Production of useful goods and services in the
efficient manner.
Priorities of production:a) abundant production and supply of food and basic
items of necessity at reasonably cheap prices
b) defence requirements of the Muslim world
c) self-sufficiency in the production of basic capital
goods
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iii.
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Improvement of the quality of life
Effort should be made towards improving of the
standard of living and achievement of people moral,
economic and social welfare.
Priority of improvement of the quality of life are as
follows:a) employment creation, with all its consequent
structural, technological, environmental, regional
and educational adjustments
b) effective social security system – assuring the basic
necessities of life for all those who are unable to
undertake gainful employment.
c) equitable distribution of income and wealth.
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iv.
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v.
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Balanced development
Balanced and harmonious development of different
regions within a country of the different sectors of
society and the economy.
New technology
Focus in human development to knowledge
enrichment and creation of new technologies by the
local people.
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vi.
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Reduction of national dependency on the outside
world and greater integration within the Muslim world
Dependence upon the non-Muslim world in all
essentials must be changed to a state of economic
independence, self-respect and gradual building-up
of strength and power.
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i.
Economic development in an Islamic
framework, Khurshid Ahmad.
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Al Hisbah or a public regulatory body of state.
Function of al-Hisbah is to safeguard the
good social economic life of the society so
that each individual has equal treatments and
opportunities to feed his or her life.
Economically, al-hisbah institution which is
headed by al-muhtasib.
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1.
To enforce proper ethical behaviour and to
restrain unethical behaviour among all the
economics agents in the economy i.e
households, firms and government.
-The institutions in Malaysia such as
-JAKIM (Jabatan Kemajuan Islam Malaysia)
-Majlis Mufti Kebangsaan
-religious institution at the state e.g
JAIS,MAINS,MAIP and others.
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2. To provide public goods and services which
are not being produced by private firms
because of no profitable return to them.
-such as street lighting, schools,
universities worshipping places,playground
and etc.
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3. To act as solely market regulatory in the
economy which to avoid market violence
and abuse among the players.
-the institution will legalize the registration
and licensing of all business firms.
-e.g Securities Commision
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4. To act as consultative and informative
council to the market players in the economy.
-consultations and information to the
households and firms
-certification procedures and legislations
imposed by the state of authority such as
certifications procedures of halal
products,good corporate governnace in
business transaction and shariah compliance.
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THANK
YOU…
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