Tuesday, Oct 24, 2017
Infrastructure | Africa | Gabon

Social security for all a top priority


6 years ago

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As the cost of providing pensions and disability support is rising, the state is encouraging the large percentage of Gabonese workers and employers in the grey economy to contribute

As in a number of other countries, the viability of Gabon’s social security system is being undermined by demographic change. The cost of providing pensions and disability support is rising as people live longer, and is becoming too heavy a burden for the workforce in a nation with a low birth rate.

At the same time, a large percentage of Gabonese are making no contributions to the system at all – and receiving no benefits – as they work in the grey economy. Only around 120,000 people, some 10% of the population, currently benefit from the present system. The government’s goal is to provide cover for everybody.

Gabon’s existing social security system was one of the first to be established in Africa. As things stand, however, it is neither sustainable, fair, nor widely inclusive, so a series of reforms is being introduced to make it more effective and of greater benefit to the Gabonese people.

“Even though our country benefits from quite a developed social system, the needs of our people are growing, and we need to develop and modernize our services along with the nation’s emergence,” says Maxime Ngozo Issondou, Minister for Labor, Employment, and Social Security.
 

‘Even though our country benefits from quite a developed social system, the needs of our people are growing; we need to develop and modernize our services’

 

‘the hospitals

were gradually becoming millstones. We need to readjust CNSS in the current services of social security, which were its original mission’

 ‘Even though our country benefits fro m quite a developed social system, the needs of our people are growing; we need to develop and modernize our services’

 

‘the hospitals

were gradually becoming millstones. We need to readjust CNSS in the current services of social security, which were its original mission’


Several approaches to modifying the social security code are currently under consideration. Reforms are likely to include increasing contributions, creating different types of pension for different types of employment and formalizing the official age of retirement at 60.

A key objective, albeit a long-term one, is to integrate much larger numbers of Gabonese into the system, so they can both contribute to it and benefit from it. The size of Gabon’s informal sector is by definition difficult to quantify, but an educated guess might include more than 50% of the working population; statistics from International Labor Organization suggest the figure in Sub-Saharan Africa is around 72%.

“We cannot let the formal sector alone ensure the effort of solidarity,” says Dr. Marie Therese Vane Ndong Obiang, CEO of the National Social Security Fund (CNSS). “It is not a fair situation.”

She argues that social security systems can be formidable weapons in the fight against poverty and in improving productivity. Efforts are being made to persuade employers that – beyond the compulsory aspect and penalties for non-compliance – operating inside the system is a morally required act of citizenship and national solidarity.

“I am convinced that if this awareness is shared, the rate of recovery will be boosted,” says Dr. Obiang. However, there is no intention of relying on an appeal to good conscience alone, and further effort will be put into supervising employers in order to increase revenues.

CNSS reception centers are being modernized and new facilities built across the country. “We are committed to be as close as we can get to our users,” Dr. Obiang says.

In the meantime, CNSS is instituting changes to put its own house in better order. Created more than 40 years ago, it is one of the oldest institutions in Gabon. In addition to administering contributions and benefits, it has also been managing hospitals.
 
 Improvements have been made in recent years in the efficiency with which benefit payments are made, in computerization, and in staff motivation. Now a five-year plan is being implemented to further reorganize and professionalize the institution, to improve accountability, efficiency, and service.  
  That includes improving the management of CNSS’s financial resources. Apart from the traditional direct contributions that make up its main resources, CNSS has property assets that exceed those of the Real Estate National Company, the main public operator in the field of social housing construction. Yet these assets have been failing to bring in significant revenue in rents, for which Dr. Obiang blames poor management. CNSS is also investing in refurbishing its properties in order to increase their renting value. 

  One of the most important recent changes is the decision that CNSS should withdraw from running hospitals, which are now being transferred to state management. This is a simple matter of economics, as the income from these units, which were designed to serve all Gabonese regardless of social status, is insufficient to maintain them.

“Most of the time we were compelled to take contributions dedicated to other branches to run this activity,” explains Dr. Obiang. “The hospitals were gradually becoming millstones. That is why the decision is timely. We need to readjust CNSS in the current services of social security, which were its original mission as stated by the law that created it.”

Summing up the overall effects of the changes being made, he says the aim is to offer better care for the Gabonese people through sharing the benefits of the improved economic growth that the government is working to achieve.

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