Posted in Legislative Research on Mar 16, 2020

Current budget data from the Ministry of Labour, Immigration and Population (MoLIP), shows that the Social Security Board (SSB) – the body responsible for collecting social security contributions from registered workers and employers, and providing healthcare and other benefits in return – continues to generate a significant surplus.

In spite of reforms the SSB seems to remain unable to spend the funds it is collecting, even though many view its services as poor quality and in need of improvements.(Frontier 2008) This is of particular interest currently because the government is claiming it is unable to offer compensation to workers affected by the recent global coronavirus outbreak. Due to a lack of orders and raw materials, many workers are being sent home, and there is no financial support available to these families who will be severely affected by a loss of income.

What is social security?

Social security laws and programmes vary greatly across different countries. The term can be used to refer to:

  • social insurance schemes whereby citizens make a contribution to a fund that pays benefits/pensions;
  • universal social security comprises services provided in healthcare, compensation for loss of earnings, social welfare payments or pensions, available to all
  • any services provided by government in healthcare or social support.(Wikipedia 2019)

Common standards for social security include:

  • Healthcare
  • Benefits (eg loss of income from death of family members, during pregnancy or due to illness or disability)
  • Old-age (superannuation) pension

What does social security look like in Myanmar?

For these three categories of social security – healthcare, benefits and pensions – in Myanmar, we find the following:


Myanmar has a very mixed and variable healthcare system, including:

  • a public healthcare system provided by the Ministry of Health and Sport (MoHS);
  • the SSB scheme funded by, and providing coverage to, registered participants;
  • special healthcare for government workers in some Ministries (eg Home Affairs, Defence, Energy etc.);
  • private healthcare funded through private health insurance from state-owned Myanmar Insurance(Myanma Insurance 2019) or other private insurance providers;
  • employer-provided health services on-site at factories and large businesses(Occupational Safety and Health Laws 2019), and;
  • charitable/non-profit care provided by a wide range of charities, NGOs and monasteries.(MIMU 2019)

Benefits and Compensation

There are some laws relating to medical and maternity leave entitlements for employees. For example, Myanmar law allows up to 30 days of paid leave to every employee for medical treatment; and every employed mother, whether or not they are covered by the 2012 Social Security Law, is entitled to paid maternity leave of six weeks before, and eight weeks after, delivery. Disability, unemployment and survivors’ benefits were intended to be implemented under the 2012 Social Security Law, exclusively for contributors to the SSB scheme.


There is currently an old-age state pension in Myanmar, introduced in 2016, which pays 10,000Ks/month to people aged over 85. There are also some state-funded schemes for some types of government employee and military veterans. Under the 2012 Social Security Law an old-age pension is supposed to have been introduced, exclusively for contributors to the SSB scheme. This has not yet been implemented, however.

What is the Social Security Board (SSB)?

A Social Security Fund, managed by a ‘Social Security Board’ (SSB), is established by the Social Security Act and describes a social security system to be funded by employees and employers. An employer must withhold 2% of an employee's total monthly wages and contribute an additional 3% of the employee's monthly wages to the social security fund. The scheme is compulsory for all national employers over a certain size – both government and private business – and voluntary for other employers or the self-employed.

In return for the contributions, registered participants in the scheme should receive access to healthcare and a range of other benefits, including payments to cover any unforeseen inability to work (such as the unexpected factory closures as a result of the COVID-19 outbreak) and a superannuation (old-age) pension. The scheme is administered by a Social Security Board, which is essentially a government department under the Ministry of Labour, Immigration and Population (MoLIP).

The SSB is responsible for providing services under the scheme. As such the SSB manages 4 hospitals and 96 health clinics across the country (know colloquially as ‘labour clinics’). Recently the SSB has begun to experiment with contracting out healthcare provision to private companies, such as Care Well Medical in Yangon.(Frontier 2018)

This sounds like a good scheme, so why are we looking at it?

It has been widely known for some time that the SSB is collecting significantly more money than it appears able to spend. Our latest analysis at The Ananda reveals that in 2017/18 the SSB collected 9 times more than in the previous year but is spending only 5 times more. This implies that the SSB is running up significant reserves and this is surely worthy of further investigation. SSB has been receiving 3 billion Ks / year but is heavily underspent. It has been criticised for providing low levels of compensation and poor healthcare provision

The recent inability of the government to support workers affected by the economic implications of the COVID-19 outbreak, this huge surplus accumulation is worthy of closer scrutiny. It appears there is more than enough funding available to support families affected, which leads us to question why this money cannot be used to support people now. Since the SSB law was passed 8 years ago, there has been ample time to implement the scheme.

A number of possible explanations for this accumulation of resources under the SSB have been offered, including:

  • The SSB lacks sufficient autonomy as an organisation to invest in new services, and is unable to pay medical staff a competitive salary.
  • The SSB has not yet begun to implement some elements of the social security scheme, such as the superannuation (old-age) pension, and so has not been able to spend as much money.
  • The SSB has outdated paper-based records and is implementing new technology to update its systems and better process claims.(Frontier 2017)

Whatever the reason, it is an important principle of democracy that government be held to account if it is failing to provide a level of service that has been promised. Not least because people are paying for this largely compulsory social insurance with their hard-earned wages, in addition to their income tax.

We can see that underpinning Myanmar’s Social Security Act are the following policy decisions:

  • To fund the social security system from additional contributions from workers and employers (not from mainstream government revenue)
  • To establish the SSB not just as revenue collector and administrator of the scheme but also as a service delivery agency of health services
  • To operate an additional tier of healthcare provision and social protection for people working in certain types of organisation (large employers and government employers)

How does social security work in other countries?

For the purposes of examining the SSB and trying to understand its failure to deliver for workers, we offer a quick cross-country comparison with the following countries: the UK, the US, and Brazil.

United Kingdom

The UK was one of the first countries in the world to introduce the concept of a ‘welfare state’. In the 1950s the government implemented a national, compulsory, flat rate insurance scheme which would combine health care, unemployment and retirement benefits.

National Insurance Contributions (NICs), as this is known, are made by both the worker and the employer and are collected by the Revenue & Customs department of the UK Treasury (the UK’s Ministry of Finance & Planning). From these contributions, a contribution is made to the National Health Service (NHS), and the remainder goes into a National Insurance Fund which is used to finance the state pension, and a series of unemployment and disability benefits. Any surplus after this is handed to a special Treasury department that manages government borrowing, and is used as a contribution towards reducing the national debt.

The following features of the UK system are notable when comparing them to Myanmar’s SSB scheme:

  • The UK has adopted a principle of universal healthcare, which is ‘free at the point of consumption’ for all citizens, whether contributors to the National Insurance Fund or not. The National Insurance Fund does not administer/deliver healthcare services itself, as the SSB does, but instead makes a financial contribution to the NHS to support the universal healthcare system.
  • Access to benefits is not linked to whether or not individuals are current or past contributors to the National Insurance scheme, but are available to all, subject to an individual being able to satisfactorily prove they are unable to work and/or they are taking all reasonable steps to secure a job.
  • The state pension is, however, dependent on an individual’s record of National Insurance Contributions. A total of 10 years of contributions is required to qualify.
  • Whilst administered separately from income tax, over time National Insurance Contributions have come to be seen in the UK as ‘just another tax’, and the link with healthcare is weaker than in the past. The National Health Service now gets the majority of its funding from general taxation.
  • The surplus generated in the National Insurance Fund is not, as with Myanmar’s SSB, kept in the bank, but has to be returned to the Treasury and used to help balance the nation’s finances. If this was the case in Myanmar, instead of the SSB accumulating huge reserves funding could be passed to the Ministry of Health to pay for better services, such as coronavirus awareness campaigns, community clinics or nurses.


The US healthcare system is worth looking at particularly, but perhaps as a bad example, because it is the most expensive healthcare system in the world, both in terms of healthcare expenditure per person(World Bank 2016), and in terms of expenditure as a proportion of GDP(World Bank 2016).

The US does not have a universal healthcare system, unlike rich countries, but has a mixed system of healthcare provision, comprising:

  • Public health insurance, known as Medicare, provided to people over 65 years of age or people with certain disabilities
  • Publicly-funded health insurance for government employees
  • Healthcare protection for people with low incomes, known as Medicaid
  • Private health insurance

Public funding for healthcare comes from payroll taxes collected by employers. People under-65 and who are not eligible for Medicaid must use private health insurance from their employer or purchase it themselves. Unless they do this they are simply uninsured and have to pay for health care as and when the need arises. Whichever form of healthcare coverage people access there is always a significant ‘out-of-pocket’ cost involved in accessing healthcare services, i.e. costs incurred by the patient at the point of accessing treatment. Not only is the US healthcare system the most expensive in the world, it has also been found to be one of the worst-performing when compared to other rich countries.(The Atlantic 2014)

Social security in US is also funded by payroll taxes and mainly comprises old-age and survivor pensions and certain disability benefits. Trust funds established under the Social Security Act provide for retirement and other benefits. The level of benefits people can access depends on their level of past contributions to the scheme, although there are some protections in place for those on the lowest incomes. Outside the benefits paid for by the social security trust funds, a range of federal and state-funded social welfare programs are available for poorer people, to help with access to education, housing and to be able to afford food, for example.

Notable features of the US system compared to Myanmar include:

  • There is no universal healthcare coverage, and many people in US have no health insurance. It is estimated that 45,000 people die each year as a result of having no healthcare coverage.(The Harvard Gazette 2009)
  • The US system is both the most expensive and the most poorly performing when compared to other wealthy nations. Many argue this is because of lack of an adequate safety net for the very poorest people, the high level of out-of-pocket expenses when actually in need of medical care, and the pre-eminence of the profit incentive in a market based system which has allowed costs of care and medicine to rise.
  • The system is highly mixed and complex, with many people paying into multiple schemes, both public and private.
  • As with the UK system, any surplus in state-run social security trust funds that is not required, is reinvested into the national budget.


Brazil has possibly the largest publicly funded healthcare system in the world, providing healthcare that is free at the point of access for everyone in the country. In spite of the universal coverage of the system, private health insurance is prevalent in Brazil for those who can afford it because the public system is deficient in many areas. There are two main challenges faced by the system:

The first issue has been the highly decentralised nature of the scheme, meaning that in spite of a commitment to universal and non-discriminatory services, has led to highly variable levels of service quality. This typically adversely affects those living in more remote and poorer regions.

Secondly, the system has proved vulnerable to economic and political crises. Economic recession and subsequent austerity policies introduced to enable Brazil to pay off its high levels of public debt, have seen funding greatly reduced.

In term of social welfare programmes, Brazil is most notable for its ‘Bolsa Familia’ (Family Allowance) programme, which provides direct cash transfers to poor families on the condition their children are vaccinated and attend school. Brazil also social protection and state pension programmes, notably a rural pension for people over 60 who have worked in agriculture/subsistence, and another means-tested pension scheme for poor families.

Lessons might include:

  • Brazil exemplifies the challenges of a universal healthcare system funded by general taxation, and in particular the vulnerability of such a system to political and economic crises. This vulnerability is exacerbated by a high level of socioeconomic inequality and a decades-long transition from military rule.
  • The concept of universal standard healthcare is extremely difficult to maintain in a decentralised, federal system. Where financial mismanagement and corruption are significant risks in a decentralised or federal system it is invariably the poorest areas (i.e. those least well represented in political processes) who will suffer from inadequate provision.
  • As with the Bolsa Familia, welfare can be provided based on need – e.g. focused on helping the rural and other poor people of retirement age – rather than on who has or has not contributed to the fund.

What conclusions can we draw from these limited examples?

  1. Myanmar’s 2016-2021 National Health Plan (NHP)(Myanmar National Health Plan 2016) prioritises the move to Universal Health Coverage by 2030. It is not clear if the MoHS and MoLIP have a shared understanding of how to achieve this aim. The SSB establishes a separate public health system, independent of public hospitals and health centres funded by MoHS. There may be significant cost saving measures if this duplication of effort was removed. The SSB could simply transfer a proportion of funding to the MoHS to provide services for registered members of the scheme. This would also help establish a principle of universal healthcare and that does not give preferential treatment to employees of larger firms, helping achieve the pro-poor objective of the NHP.

  2. Similarly, the provisions for unemployment/incapacity benefits and retirement pension under the SSB do not seem to be integrated with the objectives of the Ministry of Social Welfare, Relief and Resettlement (MoSWRR). It does not appear that an updated version of the 2014 National Social Protection Strategic Plan has yet been published, and there is no mention of the SSB in the Myanmar Sustainable Development Plan 2018-2030. The SSB programme therefore appears to exist outside other government polices and therefore is unaccountable, as it creates enhanced access to benefits for wage-labourers in government or in formal industry. These benefits are not available to workers in the informal or smallholder economy. On this basis SSB policy would appear to be anti- rather than pro-poor.

  3. A longer-term reform worthy of consideration to reduce duplication and help create a system that is genuinely universal and pro-poor, would be to abolish the SSB and place the responsibility of collecting social security contributions with Ministry of Planning, Finance and Industry with income being transferred to the MoHS and the MoSWRR to manage their health and social welfare functions respectively.

  4. The strategy for allowing the SSB to amass its reserves in its own Myanma Economic Bank account, where is it earning interest, would appear to be an inefficient use of public funds and creates no incentive for the SSB to invest its surplus in service improvements. And no incentive to respond to emergencies like the coronavirus by quickly mobilising funding for people affected. As with the UK and the US examples, it would seem to make sense for this surplus, if not spent, to be returned to the Union government and be reallocated to other areas of need.

  5. All budget / bank accounts associated with the SSB should be open to view, and the refusal to allow the public to see the figures should be regarded with suspicion. Why is this information not fully public? If it is public funding, the information belongs to the people.(Frontier 2018)

  6. Further reforms should seek to reduce the complexity of the health and social security systems in Myanmar. As with many areas of government, healthcare seems to be one area where multiple ministries and departments are involved, with different philosophies and approaches. The US example shows just how costly a highly complex system can be, especially with the added involvement of an under-regulated private sector.

  7. Government should make much better use of data in order that funding allocations for health and social welfare related schemes is directed towards those most in need. In particular, under a federal system, careful attention will need to be given to ensuring that funding allocations are made that support poorer areas and to bring all parts of the country up to common standards. Open publication of data, reports and other information used to make policy decisions will help encourage equitable funding distributions.


Frontier (2017)

Frontier (2018)

Myanmar National Health Plan (2016), summary, Burmese and English versions

Myanmar Information Management Unit (MIMU), through its latest ‘3W’ reporting from development agencies working in Myanmar, showed that 79 of the 225 agencies (INGO, NGOs, donors etc) who reported their activities, were working in the health sector in February 2019.(Note the actual number is likely to be far higher, as the MIMU data is based on self-reporting and huge number of organisations working in Myanmar do not report.)

Myanma Insurance

The Atlantic (2014) U.S. Healthcare: Most Expensive and Worst Performing

The Harvard Gazette (2009) New study finds 45,000 deaths annually linked to lack of health coverage

Social Security (Wikipedia)

World Bank, Current health expenditure per capita, PPP (current international $) 2016,

World Bank, Current health expenditure per capita, PPP (current international $) 2016,