ILO COMMENTS ON SOCIAL SECURITY IN DEVELOPING COUNTRIES

Social security and ageing populations in

developing countries

[Some comments of ILO in their Report are reproduced below]

It is common knowledge that life expectancy in Western countries has increased over the past several decades and will continue to rise. However, it may come as a surprise to some that the ratio of elderly people is rising faster in the developing world than in industrialized countries. What’s more, in some instances the average life expectancy in emerging countries now exceeds that of richer nations. Already today, a majority of the world’s older people live in low-income countries with no pension coverage. In 50 years, 80 per cent of the elderly will be in these countries. Alyssa Sewlal, an ILO intern, reports.

Where the development discourse once focused on limiting social expenditure, it is now widely understood that social spending is actually necessary for growth. In the Conference report, the ILO’s social security experts point out that well-designed social protection programmes, particularly in the form of social security pensions, rather than being a hindrance to economic development have proven “very effective in preventing poverty and social insecurity throughout an individual’s entire life cycle”; moreover, they fulfil a vital role as an economic stabilizer.

Some financial institutions and economists have argued that social security programmes are simply unaffordable in developing countries. But if crises are good for anything, it is to demonstrate how valuable to the most vulnerable in society social security benefits and assistance are. The truth is, says the ILO’s social security team, that a basic social protection package is affordable in virtually all countries, costing – if appropriately designed –a relatively small percentage of GDP. For these programmes to be successful, the key may be for them to be implemented gradually.

Social security has long been a defining element of industrialized countries, playing a crucial role in easing the blow of not only a range of life-cycle crises but also of numerous economic ones, and serving to effectively reduce income inequalities. There are obvious reasons why governments of emerging and developing countries need to organize and implement universal social security programmes, in particular the fact that if nothing is done, the nation will soon face a vast number of elderly people living in poverty. But it is important, says Bimal Kanti Sahu, to recognize specifically the extent to which the ageing population have contributed in their younger days to the development of their countries, and ensure that these senior citizens live out their lives with dignity.