India with 80 million
plus population, is an interesting example of demographic change in the recent
decades. There are multifarious reasons for the change. Health care, education
and family planning have a lot to do with it this rapid change. These advances
have also changed some of India’s social dimensions, particularly one of the
most distinct features of Indian culture: the joint family system.
But this is slowly
changing as India’s economy rapidly develops, leaving elderly Indians in a
particularly precarious situation. Informal old-age income support systems have
always been available, so for this and other reasons a state-financed pension
in India has hardly been extended, and has until recently been largely denied
to the workforce in the informal economy.
An alternative to this
is reviving the joint family system by enacting laws that force adult children
to take care of their elderly parents and relatives. Another option is strengthening
the requirement that the working population save for their retirement, whether
in public or private schemes. Instead, it seems that India will have to find a
balance between traditional family support and self-support in the form of
pension and other retirement benefit schemes.
The challenge of
caring for an increasingly elderly population is an issue not only for India,
but for other rapidly developing countries in Africa, Asia and Latin America
where population ageing is set to grow at increasingly higher rates. Just as in
India, this means that the resources of these countries are being severely
stretched.
The problem is
compounded by the fact that a vast number of elderly people are employed in the
informal economy and have little or no access to any contributory social
security schemes; this means that it must be a matter of priority to address
the issues of social security provision appropriately.
Where the development
discourse once focused on limiting social expenditure, it is now widely
understood that social spending is actually necessary for growth. Some experts
point out that well-designed social protection programmes, particularly in the
form of social security pensions, rather than being a hindrance to economic
development have proven “very effective in preventing poverty and social
insecurity throughout an individual’s entire life cycle”; moreover, they fulfil
a vital role as an economic stabilizer.
Some financial
institutions and economists have argued that social security programmes are
simply unaffordable in developing countries. But if crises are good for anything,
it is to demonstrate how valuable to the most vulnerable in society social
security benefits and assistance are. The truth is, says the ILO’s social
security team, that a basic social protection package is affordable in
virtually all countries, costing – if appropriately designed – a relatively
small percentage of GDP. For these programmes to be successful, the key may be
for them to be implemented gradually.
Social security has
long been a defining element of industrialized countries, playing a crucial
role in easing the blow of not only a range of life-cycle crises but also of
numerous economic ones, and serving to effectively reduce income inequalities.
There are obvious reasons why governments of emerging and developing countries
need to organize and implement universal social security programmes, in
particular the fact that if nothing is done, the nation will soon face a vast
number of elderly people living in poverty. But it is important to recognize
specifically the extent to which the ageing population have contributed in
their younger days to the development of their countries, and ensure that these
senior citizens live out their lives with dignity.
