Last week’s contribution looked at the relationship between social security and economic development from a conceptual basis. To advance the discussions it is important to consider this issue from a historical perspective, drawing specifically on the experience of one of our neighbouring islands.
Indeed, to further illustrate the social security-economic development nexus, I sought from Bernard Coard, the Finance Minister under the People’s Revolutionary Government (PRG) of Grenada, the thought process that eventually gave rise to the establishment of Grenada’s National Insurance Scheme (NIS) on April 4, 1983 by NIS Law 14|1983.
Here is what he said: “When, as minister of finance, I launched the NIS in April, 1983 . . . the objectives fell into two broad categories . . . . The second objective was to generate a substantial pool of savings for investment within the economy, such that there would be greater GDP growth and employment creation than would be the case without these savings.”
To put the rationale behind the establishment of the NIS into proper perspective, based on the social and economic realities of the day, Coard recalled: “It cannot be overemphasised: the importance of some system of social security for all members of a society.
There was none for the vast majority of Grenadians prior to April, 1983; few other than civil servants enjoyed pension rights. The plight of thousands of elderly Grenadians begging or depending on family abroad; of many going hungry every day, was painful to see, but it was part of my childhood experience, growing up in the 1940s and 1950s.”
On the economic development question, Coard explained: “It is also critical to recognise that the more savings a country can generate, the faster it can grow its economy, create more jobs, generate greater government revenues and, in the process, lift most people’s living standards; and transform the society’s social structure, as more and more people find jobs, earn more income, achieve decent housing of their own, and so on.”
Finally, to conclude our discussion of social security within the economic development process, I turn, once more, to the World Social Security Report 2010/11: Providing Coverage In Times Of Crisis And Beyond. The preface to the said report begins: “Social security is a human right as well as a social and economic necessity.
All successful societies and economies have employed development strategies where social security systems played an important role to alleviate poverty and provide economic security that helps people to cope with life’s major risks or the need to quickly adapt to changing economic, political, demographic and societal circumstances.”
If, therefore, we accept both sets of views as true reflections of the significance of social security to our social and economic development, then, clearly, we ought to ensure that everything humanly possible is done to protect our social security schemes. And hence, irrespective of how these schemes evolve, they should always fulfil our broad socioeconomic goals.
We in Barbados and the wider Caribbean must continuously ask ourselves these fundamental questions: Have we allowed our social security schemes to fulfil their true potential in reconfiguring the social and economic landscape of our countries since their establishments?
Have we as a people maximised the developmental roles of our social security schemes or have those opportunities been largely squandered?
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