Social Insurance (1)

Generally, public sector workers are automatically enrolled in social insurance schemes. Enrolment is also in most cases mandatory for salaried employees in the private sector. However, this is often not enforced in practice, meaning that many private sector workers are employed on an informal basis and thus lack social insurance coverage. In some countries, voluntary schemes have during
recent decades, with various rates of success, been set up for groups such as the self-employed and seasonal and agricultural workers. It has been estimated that around two thirds of workers in the Arab region are not covered by social insurance. Generally speaking, the rate of informality is higher in countries with a low GDP per capita.[2]

The main pillar of social insurance schemes is old-age insurance, e.g. pension benefits, which are given to insured workers once they have reached the legal retirement age.[3] Another crucial part is made up of disability benefits, also called disability pensions. These are given to workers covered by social insurance who incur a disability. As a rule, insured workers must, in order to access the disability pension, be declared to have a specific degree of disability. He or she must also have been enrolled in the social insurance system for
a certain period and/or have made a certain number of contributions within a specific time-span. In Egypt, for instance, the worker must “have at least three consecutive months or
a total of six months of contributions”. Furthermore, “[t]he disability must begin while in covered employment or within a year after employment ceases; 10 years of contributions are required if the disability began more than a year after employment ceased.”[4]

Basic disability benefits are usually calculated through a formula incorporating the beneficiary’s length of contribution as well his or her level of earnings. There are often minimum and/or maximum thresholds: in the United Arab Emirates, for instance, the disability benefit is never lower than 10,000 dirhams (approximately $2,700) per month,[5] and in Morocco’s public-sector Régime Collectif d'Allocation de Retraite (RCAR) scheme it never exceeds 60 per cent of the beneficiary’s average wage.[6]

In determining eligibility and calculating the benefit, many schemes make allowance for disabilities incurred as a result of service. In Yemen, for example, a work-related total disability entitles an employee enrolled in the private sector scheme to a benefit corresponding to 100 per cent of his/her highest monthly salary during the last year of employment, while a non-work-related disability entitles the employee to a salary worth just 50 per cent of the average monthly pay.[7]

It is common that the size of the benefit is somehow contingent upon the severity of the disability. In Algeria, full-disability benefits and partial-disability benefits amount, respectively, to 80 and 60 percent of the insured person’s salary. Most social insurance schemes include some type of supplement given to those whose disability means that they need special support. The scheme for private sector workers in Mauritania, for example, offers a constant attendance allowance, corresponding to 50 percent of the pension, “if the insured requires the constant attendance of others to perform daily functions”.[8]

Other benefits provided within the framework of social insurance schemes can include provisions for persons with disabilities within the insured person’s household. In Jordan, old-age pensioners with a person with a disability in their family may be eligible for a dependent’s supplement amounting to 12 per cent of the pension.[9] In Tunisia, family benefits within the social insurance scheme for private sector workers are normally paid for children up to
16-21 years of age, depending on if they are studying, but no such age limit is in place for children with disabilities.[10] Similar exceptions often apply to the rules concerning when a beneficiary’s survivors (orphans, widows, widowers) are entitled to inherit their benefits. In Saudi Arabia, for instance, the survivor pension is paid to sons of the insured person if they are younger than 21-26 years old (depending on whether they are pursuing studies), but no age limit exists for those deemed “unable to work”.[11]