Sickness benefits, life insurance, workers' compensation and family benefits make up social security.
Social security is the care and assistance that a society provides to its citizens so that they can satisfy certain basic needs and face various contingencies . This is a benefit that is generally provided by the State through different organizations and programs.
Old age , unemployment , illness and disability are some of the issues addressed by social security. Its purpose is to provide resources to people so that they can go through certain stages or situations without experiencing hardship.
Origin of social security
The origin of social security is in the 1880s . At that time, German Chancellor Otto Bismarck implemented a series of policies to provide protection to the population, acting in line with what would later be known as the Welfare State .
The social security provided by Bismarck was structured into measures such as a retirement pension from the age of 70, a disability pension, accident insurance and a compensation program. According to analysts, the chancellor's intention was to grant certain benefits to workers to maintain the proper functioning of Germany 's economy and, above all, to prevent workers from turning to socialism .
To implement these policies, Bismarck devised a pay-as-you-go contributory system . A direct link was established between workers' contributions and the pensions they had access to upon retirement, while workers' contributions made it possible to pay retirees' pensions.
Social security is part of the worker's rights.
Historical development
The historical development of the idea of social security had another important instance between 1933 and 1938 with the New Deal promoted by US President Franklin D. Roosevelt . The president sought to promote state intervention to minimize the negative consequences of the Great Depression .
Within this framework, basic social insurance had been created at the local level to help the elderly, but Roosevelt encouraged that assistance be formalized through a broader federal law. Thus, on August 14, 1935, the Social Security Law was approved.
This legislation established different aid for the disabled, unemployment insurance and retirement from the age of 65. To finance these expenditures, employers and active workers had to make contributions, as had been decided in Bismarck 's Germany .
In the 1940s , meanwhile, a different model was designed in the United Kingdom . Its creator was Sir William Beveridge at the request of the Minister of Labour , Ernest Bevin . After conducting a series of studies, Beveridge proposed that all individuals of working age had to pay rates to qualify for social benefits.
The so-called Beveridge Report suggested the creation of a system that would provide a subsistence assistance pension with an equal and fixed sum for the majority of workers. This benefited the poorest (since the pension was the same for almost everyone, even those who had contributed little had the right to collect it), but it also benefited the richest (since the contributions were minimal and left them room to allocate another part from income to private savings).
Over time, many countries adopted social security systems. The concept even became part of programs and agreements of institutions such as the International Labor Organization ( ILO ) and was incorporated by the United Nations ( UN ) in the Universal Declaration of Human Rights .
Administration and financing of social security
Currently, most social security systems continue to be administered by the State. However, there are nations that contemplate the participation of companies to provide certain benefits (such as prepaid medicine companies and those that manage pension funds ).
Regarding financing, social security is usually based on the principle of contributory : active workers and companies are obliged to contribute to the system. In any case, there are also non-contributory benefits that are intended for those who did not contribute the amounts expected to access contributory benefits or are informal workers.
Thus, contributory benefits are financed directly with the contributions of beneficiaries (active workers) and employers, while non-contributory benefits are supported by public resources (such as taxes ).
The pension system contemplated by social security can be financed in different ways according to labor legislation .
Lack of coverage
It is estimated that only 20% of the world's population has extensive social security coverage. More than half of people, in fact, do not have any type of protection.
This problem is linked above all to the informality of the economy and poverty . Millions of men and women are self-employed or home-based workers or have temporary jobs, which means they do not make contributions and do not access benefits.
It should be noted that, with social security, workers - and their families - are protected against unemployment, illness, maternity or an accident thanks to resources such as medical assistance , disability insurance (or disability insurance), etc. At the same time, they obtain income once withdrawn.
Children, on the other hand, enjoy coverage of their study expenses when the family receives the corresponding social assistance. Even companies benefit from worker protection because the benefits provide stability to employment relationships and help maintain the productivity of the workforce.