Harmonisation and coordination principles for social insurance in the European Union and lessons for China

2. Harmonisation and coordination
principles for social insurance in the
European Union and lessons for
China
Eloise O'Riordan – Research Associate, IBM
Cúram Research Institute

3. 今天我想讲普通话…..
…..but my Mandarin is too bad!

4. European Union founded to promote peace & equality
• Economic and political partnership – 28 European countries – 500
million inhabitants
• Overall aim: promote peace; the values of human rights; equality; the
rule of law; and the well-being of its people
• Mission is to bring countries together to pursue shared interests and
values
• Purely economic focus has evolved into EU competence in other policy
areas including social policy
• European social security developed using two different techniques:
Coordination and Harmonisation
European Union = “United in Diversity”

5. Coordination of Social Security – enabling free
movement of labour
• Coordinates national social security systems to protect the security of migrating
people
• Does not replace national systems with a single European one but guarantees
rights in the area of:
– Sickness insurance
– Pensions
– Unemployment
– Family benefits
• Each country is free to determine its own social security system
• Benefits anyone who moves to another EU country to settle permanently, work
temporarily, study, or to take a holiday
Protects people’s social security rights
when they go to work in another
country

6. The four main principles of Coordination
1. Extension of coverage: You are covered by the legislation of
one country at a time so you only pay contributions in one
country.
2. Equal treatment or non-discrimination: You have the same
rights and obligations as the nationals of the country where
you are covered.
3. Aggregation of periods: When you claim a benefit, your
previous periods of insurance, work or residence in other
countries are taken into account if necessary.
4. Exportability: If you are entitled to a cash benefit from one
country, you may generally receive it even if you are living in
a different country.

7. The need for Coordination
Paul is a migrant worker who became an invalid
after having been covered for 4 years in a member
state where an insurance period of at least 5 years
is required for entitlement to invalidity benefits and
then for 9 years in a member state where 10 years
of insurance are required.
If the regulations did not exist, Paul, according to national law alone, would
not be entitled to invalidity benefits in either of these states despite having
been covered for a total of 13 years.

8. Harmonisation
Definition of Harmonisation:
Direct intervention into the national social security law of Member
States by making states adjust their national laws to conform to the
harmonisation regulations with the goal of streamlining systems
• In extreme situations, harmonisation could lead to the unification of national law
• In less drastic forms harmonisation can be used for the setting of minimum
standards
• Harmonisation far less developed than the international law of coordination
• The norms that exist result not from bilateral treaties, but from the work of
international organizations – the ILO has helped the development of social security
at a national level, by setting minimum standards
One goal: the promotion of the idea of
compulsory social insurance and its
extension to as many groups of wage-earners
as possible

9. Enabling Coordination – EURES – The European Job
Mobility Portal
• EURES (EURopean Employment Services) and its network helps workers search for
a job across European borders, having in its database more than:
– 1 million job vacancies in Europe
– 760,000 CVs
– 25,000 registered employers
• The main objectives of EURES are the following:
– To provide advice and guidance to employees on work opportunities, working
and living conditions in Europe (EU/EEA/Switzerland)
– To offer assistance to employers to attract workforce
– To advise employers and workers in border regions
EURES promotes mobility in
the labor market

10. Enabling Coordination – Electronic Exchange of Social
Security Information (EESSI)
• EESSI is a set of standards that will help social security bodies across the EU
exchange information more rapidly and securely
• At the moment there is no EU-wide system and most exchanges are still paper-based
• All communication between national bodies on cross-border social security files
will take place using structured electronic documents
• Benefits include:
– For the public:
• Faster management of claims
• Faster calculation and payment of benefits
– For public administrations:
• Standardized flows of information
• Better multilingual communication thanks to common structured documents
• Optimized verification and collection of data

11. Enabling Coordination – European Health Insurance
Card
• A free card that gives you access to medically necessary, state-provided
healthcare during a temporary stay in any of the 28 EU countries, Iceland,
Lichtenstein, Norway and Switzerland
• Given under the same conditions and at the same cost (free in some
countries) as people insured in that country
• 187 million (37%) Europeans currently hold a European Health Insurance
Card

12. Some lessons to draw from the EU approach
1. Social cohesion and economic development can be brought about
through applying coordination and harmonisation measures
2. Coordination can bring together diverse and separated systems
3. Information Technology is required to make coordination efficient
4. Economic development can be facilitated by enabling labour
mobility
5. Harmonisation provides consistency of basic coverage & minimum
standards that works towards poverty alleviation
6. Coordination and harmonisation are complex measures, achieved
over time, the degree and pace of which is a key decision

13. 谢谢