In the USA, a tax on wages and salaries imposed to pay for retirement benefits, disability insurance, and hospital insurance. The tax is an important part of all Federal revenues (around 40%), and is the equivalent of British national insurance. In the UK, social security refers to the provision of financial aid by the state to reduce poverty. It comprises a wide range of benefits (covering such matters as housing and family allowances) which are available to those in need. More broadly, social security is a system of financial maintenance organized by governments to protect individuals against loss of earnings resulting from sickness, unemployment, and old age, and to give support to families with children. The term also covers social insurance and social assistance schemes. With social security receipts accounting for a quarter of GDP in some countries, governments have raised insurance contributions and reduced benefits while boosting the importance of occupational and personal insurance. Most developing countries and former communist countries lack either the money or the administrative infrastructure for social security systems.
Social security primarily refers to a field of social welfare concerned with social protection, or protection against socially recognized conditions, including poverty, old age, disability, unemployment, families with children and others. Although some publications use the terms "social security" and "social protection" interchangeably, social security is used both more narrowly (to refer only to schemes with the formal title of 'social security') and more widely (referring to many kinds of social welfare scheme). Social security may refer to
social insurance, where people receive benefits or services in recognition of contributions to an insurance scheme. These services typically include provision for retirement pensions, disability insurance, survivor benefits and unemployment insurance. income maintenance—mainly the distribution of cash in the event of interruption of employment, including retirement, disability and unemployment services provided by administrations responsible for social security. In different countries this may include medical care, aspects of social work and even industrial relations.Basic security
Social security is identified in the Universal Declaration of Human Rights of 1948:
"Art. 22—Everyone, as a member of society, has the right to social security and is entitled to realization, through national effort and international co-operation and in accordance with the organization and resources of each State, of the economic, social and cultural rights indispensable for his dignity and the free development of his personality."The Wresinski report identifies lack of basic security as "the absence of one or more factors that enable individuals and families to assume basic responsibilities and to enjoy fundamental rights".
Social insurance
Before government-run social insurance programs were enacted, private groups had developed the concept of shared risk.
The first state-run social insurance program paying retirement benefits was implemented in Germany in 1889 by Chancellor Otto von Bismarck.
In the United Kingdom the first contributory pension scheme was enacted in 1911, enthusiastically supported by Winston Churchill who described the social insurance principle as "bringing the miracle of averages to the rescue of the millions". Beveridge attempted to make insurance the basis for a comprehensive, universal scheme covering all the main social needs. President Franklin Roosevelt described the ideal social insurance system as one which provided economic protection "from the cradle to the grave."
Social security is seen as providing assistance to retired workers, often in the form of a superannuation system that provides a pension from a fund to which workers and their employers (and in most countries the government) have contributed throughout their working lives. In most of the developed "first world" countries, social security also includes a system of universal health care.
Government pension expenses
As a % of GDP during 2000 () () Italy 14% France 12% Germany 12% Sweden 9% Japan 8% USA 4% South Korea 2% Hong Kong 2%Income maintenance
Social security policy is usually applied through various programs designed to provide a population with income at times when they are unable to care for themselves. While assistance is often in the form of financial payments, those eligible for social welfare can usually access health and educational services free of charge. The amount of support is enough to cover basic needs and eligibility is often subject to a comprehensive and complex assessment of an applicant's social and financial situation. Some schemes are based on the discretion of an official, such as a social worker.
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