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The mechanism of social insurance as a financial instrument of securing social stability

The mechanism of social insurance as a financial instrument of securing social stability
Земфира Алямова, старший преподаватель, кандидат экономических наук

Дина Бухарбаева , старший преподаватель

Багдагуль Таскарина , заведующий кафедрой, кандидат экономических наук

Актюбинский государственный университет им.К.Жубанова, Казахстан

Участник конференции

The analysis suggests that the existing mechanism of social insurance in the Republic of Kazakhstan that was formed and endured changes in the transition period, is one of the instruments to ensure social stability and dynamic development of the economy of Kazakhstan.

Keywords: social stability, social protection system, social insurance, social benefits, social protection

 

The main goal of the social state is to provide the highest standard of welfare of citizens and social stability. This goal is achieved by improving the social protection system and social insurance being one of its main components.

The mechanism of social insurance is valid in the Republic of Kazakhstan from January 1, 2005. The legal framework for the functioning of the mechanism of social insurance in the Republic of Kazakhstan is the Constitution of the Republic of Kazakhstan , the Law of the Republic of Kazakhstan "On Compulsory Social Insurance" issued on April 25, 2003 № 405 -II; the Government Decree of the Republic of Kazakhstan "On establishment of Joint Stock Company "The State Social Insurance Fund" issued on February 27, 2004, № 237 , the Concept of the Government issued on June 27, 2001 № 886 "The Concept of social safety net for the people of the Republic of Kazakhstan" and others.

The State Social Insurance Fund (the SSIF), the main government body in the field of social insurance, established in 2004, is a joint stock company with total participation of state has important social functions related to the protection of working population from social risks. Since January 1, 2005 the State Social Insurance Fund of the Republic of Kazakhstan from January 1, 2005 pays for the following types of social risks:

• loss of working capacity – starting with the establishment of the degree of reduction of working capacity on the basis of medical reports by the authorized body for the appointment of social payments;

• loss of the breadwinner – starting with the date of death stated in the death certificate or the date specified in the court's decision on the recognition of the citizen as missing or declaring citizen dead;

 • loss of a job – starting with the date of the application of the participant of compulsory social insurance system for being registered as unemployed to the authority on employment issues. [1]

Kazakhstani President’s Letter of 2007 to the people "New Kazakhstan in a New World" in support of motherhood and childhood additional social benefits were set since 2008:

• in case of loss of an income due to pregnancy and childbirth – starting with the date of maternity leave as  stated in a certificate of incapacity;

• in case of loss of income due to adoption of a newborn child (children) – starting with the date of leaving to employees who adopt a newborn child as it is stated in certificate of incapacity;

• in case of loss of an income due to child care until the child reaches the age of one year – starting with the date of birth stated in the birth certificate of the child. [2]

Let’s see the dynamics of social benefits from the State Social Insurance Fund of the Republic of Kazakhstan for the period from 2007 to 2012.

Table 1

The dynamics of the share of benefits for each type of social risk in the general
basket of payments of the SSIF of the Republic of Kazakhstan

Social benefits

2008

2009

From 2009 to 2008

2010

From 2010 to 2009

2011

From 2011 to 2010

2012

From 2012 to 2011

Total bn

29,47

44,85

52,2%

55,77

24,3%

68,77

23,3%

85,55

24,4%

In %, of which:

100

100

 

100

 

100

 

100

 

Loss of working capacity, %

3,1

3,2

+0,1

3,6

+0,4

4,1

+0,5

4,2

+0,1

Loss of a breadwinner, %

1,7

1,7

-

1,8

+0,07

2,3

+0,5

2,5

+0,2

Loss of a job, %

0,2

1,7

+1,5

1,4

-0,3

1,3

-0,1

1,1

-0,2

Pregnancy and childbirth, %

50,9

49

-1,9

46,6

-2,4

47,1

+0,5

49,4

+2,3

Childcare until the age of 1 year, %

44,1

44,4

+0,3

46,6

+2,2

45,2

-1,4

42,8

-2,4

Note: The table is compiled by the author on the basis of the source data [3]

The conducted analysis (Table 1) shows the share of benefits for each type of social risk in the total social benefits. Table 1 shows that in 2008 the bulk of payments accounted for the social risk "pregnancy and childbirth" was 50.9 % of the total. There was a decrease in the proportion of benefits for social risk "pregnancy and childbirth" in the period from 2008 to 2011: in 2009 there was a decline by 1.9 percentage points, a decline by 2.4 percentage points was in 2010, an increase by 0.5 percentage points was in 2011. With the reduction in the share of this index benefits for loss of working capacity and loss of a breadwinner increased: in 2010 - by 0.4 percentage points and 0.07 percentage points, respectively, in 2011 - by 0.5 percentage points in each kind of benefits. In addition, the table reflects a sharp increase in benefits under the risk of "loss of a job" in the period from 2008 to 2009. The main factor contributing to the increase in benefits was the consequences of the global financial crisis that affected the economy of Kazakhstan in 2008-2009. At this time the SSIF of Republic of Kazakhstan developed a system to support people who lost jobs. The duration of receiving monthly social benefits from the Fund in the case of job loss from January 01, 2009 to January 01, 2011 depending on the length of participation increased from four months to six months of benefits.

Let’s see the dynamics of social deductions and interest received by the SSIF of the Republic of Kazakhstan and the number of participants of organizational and economic mechanism of social insurance for the period from 2007 to 2012. (Table 2).

Table 2

The dynamics of social deductions and interest of the SSIF of the Republic of Kazakhstan and the number of participants in the mechanism of social insurance for the period from 2007 to 2012

 

Indexes

2007

 

 

2008

 

 

Accession rate%

2009

Accession rate%

2011

Accession rate%

2012

Accession rate%

Social deductions, bn

49,8

60,5

21,4

89,4

47,7

156,6

19,5

183,3

17

Number of members, mln

5,3

5,5

3,8

5,7

3,6

6,1

3,4

6,3

3,28

Note: The table is compiled by the author on the basis of the source data [3]

A steady increase in the volume of received social deductions is shown in Table 2: deductions totaled 49.8 billion tenge in 2007, it was 60.5 billion tenge in 2008, the gain of receipts for the period amounted to 21.4%, the revenue was 89, 4 bln in 2009, there was 131.1 billion tenge in 2010, an increase was respectively 47.7% and 46.6%. In 2011, the growth rate declined to 19.5% and in 2012 it was up to 17%.

The constant growth of social deductions due to the stable growth of the average monthly nominal wages, and the number of working population in Kazakhstan. (Table 3).

Table 3

The main indicators of the labor market in the Republic of Kazakhstan

Indexes

2007

2008

2009

2010

2011

2012

Gainfully occupied population, thousand of people

8228,3

8415,0

8457,9

8610,7

8774,6

8981,9

Working population, thousand of people

7631,1

7857,2

7903,4

8114,2

8301,6

8507,1

Unemployed population, thousand of people

597,2

557,8

554,5

496,5

473,0

474,8

Unemploymentrate,%

7,3

6,6

6,6

5,8

5,4

5,3

Note: the source [4]

Table 3 shows that for the period from 2007 to 2012 there was an increase in such indicators as the gainfully occupied population, working population and the reduction of unemployment in Kazakhstan.

During this period, the factors influencing the growth of social deductions also increased. For example, the index of gainfully occupied population in the period from 2007 to 2011 shows a steady increase by 546,300 people; the rate of the working population increased by 670,500 people, the unemployment rate fell by 26%. In addition to the above factors the size of the average increase of nominal wages and social charges influenced the growth of social deductions.

The rate of social deductions was set at 3% of the facility charges in 2007, in 2009 it was 4%, and in 2010 it was 5%. The stable growth of average nominal wages is depicted in Figure 1 and increased from 52479 to 90028 KZT for 5 years (from 2007 to 2011).

The above mentioned factors contributed to an increase of social deductions to the State Social Insurance Fund of the Republic of Kazakhstan.

Figure 1 – The main indicators of wages from 2000 to 2011 in the Republic of Kazakhstan

Note: the source [4]

The conducted analysis suggests that the existing mechanism of social insurance in the Republic of Kazakhstan that was formed and endured changes in the transition period, is one of the instruments to ensure social stability and dynamic development of the economy of Kazakhstan.

In conclusion, the identified interrelation of mechanism of social insurance and state policy in the formation of social protection of the working population should be noted. The existing mechanism of social insurance as for labor forces forms a stable social support in all real sectors.

 

References:

  • 1. The Law of the Republic of Kazakhstan "On Compulsory Social Insurance" issued on April 25, 2003 № 405-II.
  • 2. Kazakhstani President’s Letter  "New Kazakhstan in a New World" issued on February 28, 2007.
  • 3. www.gfss.kz- the official website of the State Social Insurance Fund of the Republic of Kazakhstan
  • 4. www.stat.kz- the official website of the Agency on Statistics of the Republic of Kazakhstan
Комментарии: 3

Алване Хассан

Интересная работа. Четко виден личный творческий вклад автора в исследуемые проблемы. Успехов в дальнейших исследованиях!

Романович Людмила Геннадьевна

Тема работы актуальна и представляет интерес. Материал изложен методично. Успехов в дальнейших исследованиях!

Зульфугарзаде Теймур Эльдарович

Проблемные аспекты социального страхования, исследованные автором, представляются значимыми практически для всех. Тема исследования актуальна. Работа представляется значимой для современной науки и заслуживает высокой оценки.
Комментарии: 3

Алване Хассан

Интересная работа. Четко виден личный творческий вклад автора в исследуемые проблемы. Успехов в дальнейших исследованиях!

Романович Людмила Геннадьевна

Тема работы актуальна и представляет интерес. Материал изложен методично. Успехов в дальнейших исследованиях!

Зульфугарзаде Теймур Эльдарович

Проблемные аспекты социального страхования, исследованные автором, представляются значимыми практически для всех. Тема исследования актуальна. Работа представляется значимой для современной науки и заслуживает высокой оценки.
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