280 Government Finance Statistics Manual 2014
the contributions of the participants and/or their em-
ployers are kept in a separate account and may be
withdrawn under specifi ed circumstances, such as re-
tirement, unemployment, invalidity, and death.
A2.13 Social protection arrangements (covering
social assistance and social insurance) must be orga-
nized collectively for groups of workers or be avail-
able by law to all workers or designated categories of
workers, possibly including unemployed persons as
well as employed. Social insurance includes private
social insurance schemes arranged for selected groups
of workers employed by a single employer, and social
security schemes (see paragraph 2.101).^5
A2.14 Many social insurance schemes (cover-
ing social security schemes and employment-related
insurance schemes) are organized collectively for
groups of workers so that those participating do not
have to take out individual insurance policies in their
own names. In such cases, there is no diffi culty about
distinguishing social insurance from private insur-
ance taken out on an individual basis. However, some
social insurance schemes may permit, or even require,
participants to take out policies in their own names.
In order for an individual policy to be treated as part
of a social insurance scheme, the eventualities or cir-
cumstances against which the participants are insured
must be of the kind listed in paragraphs A2.5–A2.7,
and, in addition, one or more of the following condi-
tions must be satisfi ed:- Participation in the scheme is obligatory ei-
ther by law for a specifi ed category of persons,
whether employed or unemployed, or under the
terms and conditions of employment of an em-
ployee, or group of employees. - Th e scheme is a collective one operated for the
benefi t of a designated group of persons, whether
employees or unemployed, participation being
restricted to members of that group. - An employer makes a contribution (actual or im-
puted) to the scheme on behalf of an employee,
regardless of whether the employee also makes a
contribution.
A2.15 Th e premiums payable, and claims receiv-
able, under individual policies taken out under a
(^5) Social insurance schemes are a subset of social protection ar-
rangements, and social security schemes are a subset of social
insurance schemes.
social insurance scheme are recorded as social contri-
butions and social benefi ts. Most individual policies
that qualify as social insurance schemes are likely to
be for pension provision, but it is possible that they
may cover other eventualities—for example, to pro-
vide income if the policyholder is unable to work for a
prolonged period because of ill health.
A2.16 Participation in insurance schemes, public
or private, may be voluntary for the workers con-
cerned, but it is more common for it to be obligatory.
For example, participation in schemes organized by
individual employers may be required by the terms
and conditions of employment collectively agreed be-
tween employers and their employees. Participation
in nationwide social security schemes organized by
government units may be compulsory by law for the
entire labor force, except perhaps for persons who are
already covered by private schemes. Making a distinc-
tion in underlying source data between compulsory
and voluntary social contributions is required when
the total fi scal burden is calculated (see Table 4A.1).
In contrast, social assistance is provided without any
insurance involved (see paragraph A2.25).
Classifi cation Criteria for Social Protection Arrangements
A2.17 As indicated in Figure A2.2, the following
criteria are used in macroeconomic statistics to clas-
sify social protection arrangements:- Contributory versus noncontributory—Contrib-
utory schemes require actual or imputed social
contributions by the protected persons or by other
parties on their behalf to obtain entitlement to the
benefi ts. Noncontributory arrangements do not
require the payment of contributions, but other
eligibility requirements may apply. - Compulsory versus voluntary—Compulsory
schemes may be established by law and/or regu-
lation or by agreement between employer and
employees. In some cases, a scheme may be
mixed, where some people are required to par-
ticipate and others are allowed a choice. Partici-
pation in voluntary schemes is at free will. - Cover the whole (or large segments of the) pop-
ulation or just government employees—Social
protection is provided collectively to the general
population (or a large segment of the general