A slew of new health and maternity benefits for workers took effect at the stroke of midnight yesterday in a dramatic expansion of the country’s social security framework, even as labour advocates and business experts raised concerns about cost and quality.
“More people who receive services or are covered by social protection is a good point,” said Moeun Tola, executive director of labour NGO Central. “But what we need to see is the effectiveness of the services.”
As part of a raft of promises made by Prime Minister Hun Sen last year, garment workers will enjoy expanded health and maternity benefits in 2018. But changes announced in October by the National Social Security Fund (NSSF) mean that informal workers such as maids and construction workers are also eligible for the same benefits, paid for by the NSSF. The expanded perks also apply to local government officials like village chiefs and commune councillors.
In addition, under changes made in November, firms employing as few as one employee are now required to register with the NSSF and will receive workers’ injury compensation and health insurance.
In an open letter published Sunday, Labour Minister Ith Sam Heng warned that employers who failed to register their workers could face legal charges. He also urged informal workers to “please hurry and register”.
However, labour advocates questioned the quality of services provided by NSSF. Kao Poeun, project coordinator at the Informal Democratic Economy Association (IDEA), a labour group that represents tuk-tuk drivers and small tradesmen, said the NSSF needs to speed up the registration process.
According to Poeun, IDEA submitted its registration documents a month ago but has yet to hear back.
“The Ministry of Labour claims that informal workers will get benefits starting at midnight on December 31, but in practicality there is a long process to go,” Poeun said.
Central’s Tola noted that many workers covered by the NSSF still complain about quality of care in state hospitals. The goal is “not only put people into the system, but then the people are still not enjoying the services of the system,” he said.
Labour Ministry spokesman Heng Sour said yesterday the NSSF “is ready to provide the service to all its members”.
But business leaders also raised concerns that the dramatic expansions of benefits for garment workers will slow down Cambodia’s economy.
As of yesterday, employers are required to cover the entirety of the cost of health insurance for their workers, instead of splitting it evenly.
“Socially and politically it’s good, but for business and economy it’s going to be tough,” said Van Sou Ieng, chairman of the Garment Manufacturers Association in Cambodia.
He expressed apprehension that, because informal workers like maids or tuk-tuk drivers do not have to pay a fee to the NSSF, companies are effectively subsidising their costs by contributing for insurance.
“Sooner or later, [the NSSF] will raise contribution rates,” Sou Ieng said. “People who want to invest in Cambodia will not wish to pay such a cost – that is what I foresee.”