|
Colombia Social Security
Social security in Colombia, as in most of Latin
America,
developed in response to various pressure groups. Like
most
economic benefits in Colombia, social security came first
to those
groups that had political and economic strength. The
military
formed the first health security program in 1843, followed
by other
privileged public sector employee groups, notably members
of
Congress and the judiciary. Industrial laborers and other
private
sector workers attained basic coverage in 1946, but many
others
were still without any type of health or income security
benefit in
the late 1980s.
The social security system in the late 1980s was
divided into
three types of programs. The private sector, including
both bluecollar workers and management, was covered in part by the
ISS,
which included 70 percent of insured workers. The public
sector
program covered 7 percent of insured employees nationwide
and was
administered by Cajanal. The remaining 23 percent of
covered
private workers belonged to one of 300 small insurance
funds
operating at the national, departmental, or municipal
levels.
The social security program comprised three types of
coverage:
health insurance provided for medical and hospital
coverage; the
pension system made disability, old age, and death
payments; and
the family allowance program granted income maintenance
for
families earning substandard salaries. The family
allowance program
was the only standardized insurance scheme in the social
security
system. Health coverage and pensions, by contrast, varied
significantly among public sector employees, workers
covered by the
ISS, and employees belonging to smaller funds.
Public employee benefits far exceeded those of private
sector
workers. Government workers could retire ten years earlier
than
private workers, and their pensions averaged 66 percent
higher than
those paid to members of the ISS. The military was an
extreme
example of this inequity; their pensions surpassed private
worker
retirement annuities by 150 percent. Government workers
also
enjoyed superior health facilities and benefits, as
compared with
workers in the private sector.
Insurance premium payments, although similar in form
among the
various providers, were as inequitable as the benefits
received. In
all cases, social security was financed by employee and
employer
contributions, as well as state subsidies. Private
coverage through
the ISS required a joint contribution by employee and
employer of
between 15 and 20 percent of the premium, and an
additional 4
percent contribution was made by the employer for the
family
allowances fund. The lowest premiums paid, by contrast,
were those
of the public sector Cajanal program, in which workers
contributed
between 4 and 12 percent of the premiums and health and
pension
funds were fully subsidized by the state.
In addition to the fragmented, inequitable payment and
benefits
programs, the social security system's greatest failing
was its low
coverage of the population. Colombia ranked thirteenth
among
nineteen Latin American countries in social security
coverage of
the population; only 16 percent of the population was
covered by a
social insurance fund in 1985. Moreover, the programs
failed to
cover the neediest members of society, including women,
children,
and low-income male workers.
The social security system was also one of the most
expensive
in Latin America. In 1984 approximately 2.6 percent of GDP
went to
health care and pension programs. The World Bank estimated
that
extension of coverage at that level to the entire
population would
require the equivalent of 23 percent of GDP. Furthermore,
state
subsidization of public programs, particularly Cajanal,
was
excessive and varied from 60 percent to nearly 90 percent
of the
costs. According to experts, Cajanal operated an
intolerably large
deficit in the mid-1980s. The lack of a coordinated,
consistent
management and administrative system was largely
responsible for
many of these cost overruns, as well as the high level of
premiums
paid by the state.
Data as of December 1988
|
