Social Protection System In Malaysia

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4.1 Fragmentation Types of pillars Authorizing body Pillar 0: Basic benefits through social pensions or at least social assistance Department of social Welfare Pillar 1: Mandated, unfunded, defined benefit or contribution schemes • Public Service Department (Civil Service Pension Fund) • Ministry of Human Resources(SOCSO) Pillar 2: Mandated, fully funded, occupational or personal schemes • Ministry of Armed Forces )Armed Forces Fund • Ministry of Finance (EPF) Pillar 3: Voluntary, fully funded, occupational or personal schemes Security Commission Dictionary defined fragmentation as the state of being broken into separate parts. In Malaysia, our social protection system is portrayed by the fragmentation across authorizing bodies and this bodies…show more content…
World Bank defines good governance as the act of exercising authority in ways that respect the integrity, rights and needs of everyone. Accountability and transparency are among the elements to achieve good governance. However, the governing institution for social protection in Malaysia are lacking with these attributes. This is supported by Rajasekaran (2001) whereby he wrote that apart from stating a loss of RM749.68 miilion, there was no further explanation made to justify the loss in the EPF. By looking at this example, it is implied that there are no transparency in administration of social protection in Malaysia as there are no clarity on how the governing institution manage the funds. Besides, accountability are also absence because the authority are not held accountable for their performance and not answerable to the…show more content…
Instead, it is a trend that rises concerns of many other countries. United Nations (UN) defined ageing population as the process by which older individuals have a proportionally larger percentage of the total population. Although Malaysia is not yet become an aged society, however it is forecasted that Malaysia’s aged population will increase by 269% between 2008 and 2040, ranking it the fourth fastest aging nation after Singapore, Colombia and India respectively (Kinsella and Wan, 2009). This phenomena is related with rising of community’s life expectancy and it implies that more and more people from population are going to require more social protection. Therefore, challenge arise in ensuring the sustainable financing of social protection. It is because, this category of citizens contribute less to the productivity of country but yet government still need to provide social protection programme to them. This increase burden of government in ensuring the availability of funds for social protection of future generation. For instance, with rising number of old-aged within population, the cost of health care will also rise because aged population need more medical care. Hence, continuing to fund health care from the federal budget will put a strain on the government since more Malaysians become aware of available health facilities and their rights to obtain proper

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