Second Regional Seminar on Social Development: "Social Security and the Protracted Crisis: An Opportunity to Combat Inequality in the Framework of a Welfare State in Latin America and the Caribbean"

In the framework of collaboration with ILO and PAHO, and joint work with the German Cooperation and the European Union's Development Facility in Transition, ECLAC is organizing the Second Regional Seminar on Social Development, which this year aims to provide a space for dialogue and reflection on social security systems in the region. The seminar will focus on diagnoses, challenges and strategic orientations for reform and restructuring in pension and health systems in an uncertain context of recovery and the need to consolidate full guarantees for the exercise of social rights in the countries of the region. 

Since 2020, the countries of the region have faced unprecedented challenges to respond through timely and relevant public initiatives to the impacts of the COVID-19 pandemic and to guarantee essential levels of well-being for citizens and access to health as a fundamental right and an essential public good. The scenario that has been faced has deepened structural factors that had been intensifying prior to the COVID-19 pandemic: high levels of informality, in a context of profound transformations in the face of ongoing technological changes, increasing poverty and a rapidly ageing population, among others. Although the measures implemented by the countries in the area of social protection have been substantial and have made it possible to mitigate, in part, the devastating social and economic effects of the pandemic, two years after it began, the living conditions of the region's inhabitants have deteriorated considerably. There is also evidence of the significant distance that exists in the region to consolidate true welfare states, with social security systems that guarantee equal access to benefits with adequate levels of coverage, sufficiency and financial sustainability. This can be seen in the marked increase in social inequality in its various expressions and in a 27-year setback in extreme poverty: in 2021, according to ECLAC projections, the extreme poverty rate would have reached 13.8% and the poverty rate would have reached 32.1% of the population. In addition, there has been a significant deterioration in the labour market, with a marked fall in labour participation, especially among women. This has led to an important drop in the proportion of people who are affiliated or contribute to health systems and to a decade-long decline in the effective coverage of pension systems, which in 2020 would have reached only 45% of the economically active population in 15 Latin American countries (ECLAC, 2022). There is also an increase in unmet health needs during the pandemic due to the exacerbation of access barriers (WHO, 2022).

Social security systems, and in particular pension and health systems, have been at the centre of attention. This has occurred in the face of the urgent need to strengthen the capacity of health systems to respond to an increase in the needs of the population in this area, with demand in many cases unsatisfied and unequally met, as well as in the context of debates on pension systems and the insufficiency of benefits to guarantee a dignified old age. Citizen demands for guaranteed access to these systems, sufficient benefits and greater equality have increased, with higher levels of fiscal pressure in line with the strengthening of public systems, universal scope and increasing coverage with comprehensive interventions in pension and health systems that respond to the needs of the population and ensure the adequacy of benefits in both systems. In this context, the need has arisen to move towards universal, progressive, solidarity-based and sustainable schemes in order to guarantee access and coverage for the entire population.

The pandemic has thus opened up a new scenario and possibilities for rethinking the architecture of welfare regimes in the region and the way in which old and new risks are redistributed. In the aftermath of the social and economic deterioration resulting from the COVID-19 pandemic, gaps and inequalities in access to key social protection instruments to protect against the risks of poverty, including access to pensions, health and unemployment insurance, have become more evident and, in several cases, have deepened. Rising levels of unemployment and labour informality are major barriers to the financial sustainability of social protection systems. In view of this, it is imperative to explore strategies to strengthen the institutional capacities of the State in order to advance towards comprehensive reforms in line with the principles of social security.

On the one hand, the COVID-19 pandemic has highlighted the importance of strengthening the coordination between health and social protection systems, as well as the structural weaknesses of health systems in Latin America and the Caribbean, with a strong impact on the health of vulnerable groups. Given this reality, it is necessary to deepen the development of public policies to restructure and strengthen the response capacity of health systems and move towards universal coverage and access, with timely and quality care for the entire population. This reflection should consider the need to increase investment in health through a sustainable increase in financing and a more efficient organisation of health services, with a strong emphasis on a first level of care strengthened in its capacity to resolve problems and with integrated and comprehensive models of care and attention, centered on people and communities, and with the capacity to address the social determinants of health.

In the case of pensions, these systems are a constitutive element of universal social protection systems and of countries' welfare architectures, and play a decisive role in the economic security of millions of elderly people. As ECLAC has indicated, it is essential to consolidate sustainable pension systems from a threefold perspective: coverage, sufficiency and financial sustainability, and that their design should take into account the principles of social security, including social solidarity and gender equality. Advancing in the articulation of the contributory and non-contributory components of these systems, as well as in mechanisms to universally guarantee basic benefit levels, with adherence to the set of social security principles, is a key challenge for the region, especially in view of the impacts produced as a result of the COVID-19 pandemic.