social security and the changing labour market: access for non‐standard and informal workers in...
TRANSCRIPT
This article was downloaded by: [University of California Santa Cruz]On: 24 November 2014, At: 23:40Publisher: RoutledgeInforma Ltd Registered in England and Wales Registered Number:1072954 Registered office: Mortimer House, 37-41 Mortimer Street,London W1T 3JH, UK
Social Dynamics: A journalof African studiesPublication details, including instructions forauthors and subscription information:http://www.tandfonline.com/loi/rsdy20
Social security and thechanging labour market:Access for non‐standardand informal workers inSouth AfricaFrancie Lund a ba Associate Professor in the School ofDevelopment Studies , University of Natalb Research Director of the Social ProtectionProgramme , International network WIEGO(Women in Informal Employment: Globalisingand Organising (www.wiego.org) E-mail:Published online: 13 May 2008.
To cite this article: Francie Lund (2002) Social security and the changinglabour market: Access for non‐standard and informal workers in SouthAfrica, Social Dynamics: A journal of African studies, 28:2, 177-206, DOI:10.1080/02533950208458737
To link to this article: http://dx.doi.org/10.1080/02533950208458737
PLEASE SCROLL DOWN FOR ARTICLE
Taylor & Francis makes every effort to ensure the accuracy of allthe information (the “Content”) contained in the publications on our
platform. However, Taylor & Francis, our agents, and our licensorsmake no representations or warranties whatsoever as to the accuracy,completeness, or suitability for any purpose of the Content. Anyopinions and views expressed in this publication are the opinionsand views of the authors, and are not the views of or endorsed byTaylor & Francis. The accuracy of the Content should not be reliedupon and should be independently verified with primary sources ofinformation. Taylor and Francis shall not be liable for any losses,actions, claims, proceedings, demands, costs, expenses, damages,and other liabilities whatsoever or howsoever caused arising directlyor indirectly in connection with, in relation to or arising out of the useof the Content.
This article may be used for research, teaching, and private studypurposes. Any substantial or systematic reproduction, redistribution,reselling, loan, sub-licensing, systematic supply, or distribution in anyform to anyone is expressly forbidden. Terms & Conditions of accessand use can be found at http://www.tandfonline.com/page/terms-and-conditions
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Social Dynamics 28:2 (2002): 177-206
Social Security and the Changing LabourMarket: Access for Non-Standard andInformal Workers in South Africa
Francie Lund
Abstract
Increasing numbers of South Africans work in the informal economy and innon-standard (part time and temporary) formal employment, and there iswidespread contractualisation of formerly secure formal jobs. Many engagedin economic activities lose or never acquire access to social benefits that havetraditionally been associated with the formal workplace. The situation ofpeople in different types of employment is compared with respect to access toselected contingencies - loss of income, disability arising through work, illhealth, maternity, childcare and old age. Informal workers as well as non-standard workers are excluded from contributory schemes that depend on adefined employer-employee relationship. But South Africans do have access,as citizens, to a relatively extensive system of state assistance, includingpensions for elderly people and people with permanent disabilities, and someassistance for child support. An approach to social security is needed whichsees economically active people as placed at different points of a continuumfrom formal to informal employment, which includes a gendered and sectoralanalysis of access to social security, and which keeps open a role for multiplestakeholders - especially employers and owners of capital - in extendingsocial security coverage to informal and non-standard workers.
IntroductionSocial security systems worldwide are under pressure. One of the main tasksfaced by the post 1994 government in South Africa was the reform of socialsecurity. The underlying principles of South Africa's social security systemwere inherited from the British system during the twentieth century, beforethe introduction of Beveridge's welfare state. Though there are realdifferences between welfare systems in northern countries (Esping-Anderson,
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
178 Social Security and the Changing Labour Market
1990), all were built on assumptions about access to significant componentsof social security being through the place of work, with the state being aparallel or a lesser provider.
The Committee of Enquiry in to a Comprehensive System of SocialSecurity in South Africa ('the Taylor Committee') had to address the reformand restructuring of a system which had been built on aspects of socialprovision in advanced industrial countries, and particularly Britain, but whichhad been moulded to suit the racially discriminatory apartheid policy. TheCommittee noted:
South Africa's social safety net has its roots in a set of apartheid labour andwelfare policies that were racially based and premised in full employment. Thelast vestiges of state racial discrimination has subsequently been removed, but akey underlying principle of the old system remains in place, i.e. the assumptionthat those in the labour force can support themselves through work, and thatunemployment is a temporary condition. (South Africa, 2002: 15; italics mine)
This paper considers the challenges presented to the reform of social securityby changes in the labour market, especially by the growth of non-standard andinformal work.1 While the high unemployment rate in South Africa is amatter of deep concern, this paper focuses rather on those who do work, buthave little if any access to mechanisms of social security and socialprotection.
In many countries - industrialised, transitional, and developing -employment in the formal economy is declining, many people who are still inthe formal sector are losing access to social benefits through the processes offlexibilisation and informalisation, and the increasing numbers working at thepoorer end of the informal economy have little access to measures of socialsecurity and protection. The size of the informal economy in South Africa issmall relative to many other developing countries, but it is likely to grow, andthere are increasing numbers of people in 'atypical' yet formal work, whoseaccess to social security is being eroded. With one of the highest rates ofHIV-AIDS in the world, existing health and welfare and social securitysystems will be put under increasing strain, at the same time as access to suchsystems for large numbers of people is diminishing.
The paper starts with an overview of the informal economy in SouthAfrica. I then present a number of the ILO's 'core contingencies' of socialsecurity - protection in the face of loss of income and assets, ill health,disability, maternity, childcare, and old age - and describe the system as itexists at present for formal workers, and the access of atypical and informal
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 179
workers to such measures. I suggest that, if appropriate policies are to bedesigned for new categories of workers, a new conceptual framework isneeded which would understand risk and vulnerability according to acontinuum between formal and informal employment, according todifferential work status in different sectors (such as clothing, or constructionindustry), and including an analysis of the formal and informal regulatoryenvironments in which people work. The conceptual framework beingdeveloped in the social protection programme of a relatively new internationalnetwork - Women in the Informal Economy: Globalising and Organising(WIEGO) - is introduced.
I then identify a range of roles and actions that would improve bothprivate and public forms of provision in the interest of informal workers, themajority of whom are poor. The paper argues for a continued strong role forthe state in social provision, but also for an increased role of other interestgroups, notably employers and owners of capital, as well as trade unions. Isuggest that whether or not a Basic Income Grant is introduced, there is aserious need to investigate and tackle the reform of a number of existinginstitutions.
The Informal Economy in South AfricaThere has been a recent marked improvement in international statistics on theinformal economy. Drawing on improved national level labour force statistics,a recent study for the ILO estimated that
... informal employment comprises one half to three-quarters of non-agricultural employment in developing countries: specifically, 48 percent ofnon-agricultural employment in North Africa; 51 percent in Latin America; 65per cent in Asia; and 72 per cent in sub-Saharan Africa. If South Africa isexcluded, the share of informal employment in non-agricultural employmentrises to 87 per cent in sub-Saharan Africa. (ILO, 2002: 7)
What is the size and nature of the informal economy in South Africa?2
Budlender et al. (2002) used the 2000 Labour Force Survey of South Africa toestimate that employment in the informal economy constituted 34% of totalemployment in 2000 (this included paid domestic work). Of the 4 millionpeople in the informal economy, 2.4 million were women and 1.6 millionwere men.
Over 80% of enumerated informal workers are African. There aresectoral differences with regard to racial composition, for example, morepeople formerly classified as Indian and coloured are in clothing and textiles.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
180 Social Security and the Changing Labour Market
There are gender differences in the sectors as well, with men spread acrossvarious industries, while women are more likely to be in domestic work and intrade (Valodia, 2001). While some informal workers (including some highlyskilled women) earn high incomes, most informal work is of a low skill andlow-income nature. Women tend to be found in the lower skilled, lowerincome end of the informal economy (ibid).
For workers in formal employment, work-related risks have beencovered by contributions from themselves, employers and the state. Informalwork tends to be insecure and precarious in terms of both its reliability and theexposure to hazardous work conditions. Here, where risks are higher,responsibility for occupational health and safety is increasingly at the cost ofonly workers themselves. In fact, a common way of defining informalworkers is those who are in the workforce who do not have access to socialsecurity, as well as being beyond the reach of labour legislation.
In order to understand the challenges presented to social securityreform by the changing nature of the labour market, certain key features canbe identified. First, an increasing component of 'formal work' is becoming'atypical', though not necessarily 'informal'. While the numbers in formalemployment is declining, there are also substantial numbers working inatypical work, i.e. work that is not covered by secure contracts but which stillcould be counted as 'formal'. In the 1995 South African EnterpriseFlexibility Survey conducted by the ILO, Guy Standing and colleagues foundthat 85% of the sampled firms employed temporary workers, 43% employedcontract workers and 26% employed part-time workers. The same studyshowed the high incidence in manufacturing industries of home-based work,including 22% of the firms in clothing (Standing et ah, 1996).
Barrientos and Barrientos (2002) explored the risks and vulnerabilitiesof women and men workers in horticulture in South Africa. There has beensignificant job shedding in the South African deciduous fruit sector. In 2000,of the 283 000 jobs, 69% were temporary and casual, and 26% permanent. Ina separate study of the same industry, Barrientos et ah (1999) found that 42%the workers had no contract at all, and only 3% had a written and signedcontract.
The flexibilisation of employment patterns in South Africa is commonin industrialized countries. In the OECD countries in 1998, for example, 14%of all formal employment was part-time. The proportion was as high as 30%in the Netherlands. Women had a high share of all part-time employment, as
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 181
high as 97% in Sweden (ILO, 2002). The rates of part-time employment formen increased rapidly between 1979 and 1995 in these countries as well, butthere were fewer men doing this work (Orloff, 2000: Table 2). There had alsobeen an increase in temporary employment in those years. An ILO study(ILO, 2002: 27-28) found that part-time and temporary employees were lesslikely than full time employees to be entitled to pensions, health plans, or sickleave; self-employed people, of course, make provision for their own socialbenefits.
Secondly, the diversity within the informal economy needs to berecognized. The term 'informal sector' triggers, for many people, a dominantimage of traders, on the city streets, selling fruit and vegetables, preparedfood, or clothing. In reality, it is highly diverse, as illustrated in the Appendix.The clothing industry, for example, has been rapidly deregulated in SouthAfrica, and a diverse range of jobs has been created, which supplement thoseformal jobs which remain. People trade in goods made by themselves andothers; they trade in second hand goods; formal businesspeople in the centralcities 'employ' informal traders to sell their goods, in exchange for free livingand storage space; informal traders in turn get services by those providingtransport and storage (Motala, 2001).
Third, informal workers face different risks depending on their place ofwork. They may for example be self-employed or doing waged work in theirown homes, or on street corners, or in rotating markets, or on constructionsites. Each of these working environments poses different challenges, in termsof, for example, the 'reach' of regulations, the accessibility of workers tofinancial institutions or information systems, the ability of workers toorganize, and the level of public awareness of the workers and theirconditions of work.
Social Security Provision for Formal and Informal WorkersThe South African welfare system of the twentieth century was designedinitially to protect the white population, especially the white working class(see Sagner, 2002, and van der Berg, 1997, for useful summary histories).Outside of the formal social security and welfare systems, there wereextensive support structures and mechanisms for the white population: theearly civil service was a form of protected employment for many; extensivepublic works programmes provided temporary jobs for those in need. Thesewere complemented by the social security system of pensions and grants,especially for elderly people, people with disabilities, and to support family
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
182 Social Security and the Changing Labour Market
life, which gave residual provision for particular contingencies. There was nolong-term unemployment for whites; there was no informal employment forwhites.
Coverage of the early pension systems and worker protection systemsgradually increased to cover first people classified Indian and coloured, andthen Africans (starting with urban and then including rural people), thoughthere was racial discrimination in all aspects of the system. Rural Africanswere covered last, as there was an express policy which said that theBantustan areas would bear the costs of social reproduction. Over time arelatively sophisticated system of private and public social provision hasdeveloped. State non-contributory cash transfers go to over 4.9 millionbeneficiaries,3 with the private components accessible to those in formalwork, and to those who can afford to buy their own coverage. Some publicly-provided mechanisms are available to particular target groups. In whatfollows, provision for formal and informal workers, for a selection of corecontingencies, is outlined.
Loss of income and assets
Industralised countries have some form of insurance or social provisions toprotect workers against the risk of short-term unemployment, and temporaryloss of income. Receipt of unemployment benefits is commonly conditionalon either seeking work or agreeing to enter a re-training programme. Suchschemes were designed to mitigate against the worst effects of cyclicalunemployment, and to sustain or modify the skills levels of workers.
South Africa's Unemployment Insurance Fund (UIF), introduced in1946, is contributed to by those in formal employers and their employees. Itreceives an annual subsidy from the state (which thus effectively has acted tounderwrite the fund). Benefits are payable for a maximum period of sixmonths; there are no conditions about training. The UIF has beeneconomically fragile for many years, in the face of longer-term structuralunemployment, the increasing demands made for benefits which is linked torising unemployment, and the dwindling pool of employed contributors.
This contributory insurance mechanism is dependent on a formalemployer-employee relationship, and informal workers have thus had noaccess to it. While the new legislation is more inclusive of differentcategories of worker, the approximately one million domestic workers (mostof whom are women on very low wages) are still not included, neither areseasonal workers, nor those working for less than 24 hours per week. Yet the
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 183
highest priority identified by informal workers worldwide is the need forprotection against the short-term loss of income and assets. This is short termand timely protection against shocks caused, for example, by fire or by theft,to stop people from falling into deeper and chronic poverty. A garmentworker working in her own home for a wage is in a structurally vulnerablesituation vis-a-vis her employer or contractor. She may have little controlover the quality of the material brought to her; she may be paid on an arbitraryand irregular basis; she likely does not know who she is working for, in thesense of knowing who the owner of her means of production is - it may bethat her only contact is with the labour broker who fetches and carries goods.The loss of her sewing machine to theft or fire may cause her to lose what isan already fragile and vulnerable 'contract'.
The exceptionally high crime rates in South Africa have an impact onthe attempts by informal workers to create secure livelihoods. Yet formalinsurance mechanisms are too expensive and for those working informallywho have employers, few if any will have their assets covered by employers'insurance.
Health care
South Africa has had parallel public and private health systems for manyyears. Well before the present government moved towards a free primaryhealth care system, poor South Africans could in principle get free health care,but services were undeveloped in both rural areas and black urban townships.Better off individuals have been able to buy extremely high quality privatehealth care. There have been statutory obligations for formal employers andemployees to contribute to medical aid schemes or other health plans. Thecost of this work-based insurance has escalated steeply in recent years, andwill continue to do so as the AIDS epidemic spreads. Parallel to the 'western'medical care has been the traditional or indigenous health care system,patronized by many black South Africans, and in which thousands of peoplefind informal employment. It is not unusual to find a close equivalencebetween fees charged by traditional healers, and fees charged by 'western'general practitioners in the area.
People in formal employment continue to access increasingly expensivemedical aids or health plans. People who are being contractualised typicallylose their access to health plans, along with other social benefits, as ishappening elsewhere in the world. Informal workers are exposed health risks.They may work in precarious or hazardous working conditions - exposed to
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
184 Social Security and the Changing Labour Market
the weather and pollution (for street traders, construction workers, andagricultural workers), and to poor housing and community environments,especially for those in informal settlements. Various risks are compressed andco-variate for the informal worker - with poorer housing, a hazardousenvironment, low levels of income all converging to heighten the risk of illhealth. For the poorer informal worker, ill-health can be catastrophic. It leadsto loss of income, and then at the same time raises expenditure on the loweredincome.
South Africa has moved to extending the policy of free primary healthcare, delivered through a district health system, and this restructuring is stilltaking place. Informal workers have access to this service, though unlike thecase with formal workers who have sick leave, time taken interacting withhealth services means the opportunity of earning an income is foregone. Auseful area for detailed research would be to establish the actual costs, toinformal workers, of accessing this 'free' health service.
There is a plethora of grassroots health insurance schemes, worldwide,many of which are small, but some of which have covered some thousands ofmembers. Such schemes typically combine promotive, preventive andcurative care. Many start with the introduction of a modest package ofservices: one hospital visit per year, for example, or 'emergency'hospitalisation and basic outpatient services at the hospital.
A Bolivian mutual health insurance scheme targets those excluded fromother social security systems and includes homebased workers. Whilelooking like a promising example of 'going to scale', with 2000 membersover the first two years, it, like others, is too dependent on funding by externaldonors (Lund and Srinivas, 2000: 130). There are many examples of mutualhealth insurance in West Africa, though they do not specifically targetinformal workers (Atim, 1999). In East Africa, Kiwara (1999) has describedthe UMASIDA health insurance scheme in Dar es Salaam, specifically formembers of informal sector associations (who are largely women).
South Africa has little experience with such community-based healthinsurance schemes, presumably because of the availability of public healthcare. It is likely that the best hope for appropriate health coverage for informalworkers would lie in an improved and accessible public health system, and thedesign of conditions for flexible and low-level contributions to the plannednational health insurance system.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 185
Disability
Social security systems typically make provision for people with disabilities.In formal employment conditions, occupational health and safety regulationspromote healthy working conditions and attempt to reduce hazards in thework environment. If workers are wounded in the course of work, or contractdiseases arising from the place of work, compensation is available.
South Africa introduced legislation to compensate for work-relatedinjury, disease, and death nearly a century ago, in 1914 (for more detail seeLund, 1997). This was consolidated in 1941, and separate legislationcovering workers in the mining industry was subsequently introduced. Acomprehensive and progressive overhaul of the legislation resulted in theCompensation for Industrial Injuries and Diseases Act (COIIDA) of 1994.The workers compensation scheme is funded by contributions from employersand employees, and only covers formal workers, though in 1994 it wasbroadened to include agricultural workers. Domestic workers and contractworkers continue to be excluded. A later section describes how a newemployers association specifically makes contract workers responsible fortheir own occupational health and safety and excludes them from theprovisions of COIIDA.
Designing social security systems for disability caused through thework place has become difficult even for workers in the formal economy. InSouth Africa, a worker has to prove both the place and date of onset of injuryto claim compensation. However, with the higher mobility of labour, andwith rapidly changing technology, it becomes increasingly difficult toattribute a specific present health problem to a specific time and place of pastemployment. For example, chronic lower back-ache has become a primarywork-related health problem. But how can a worker prove that her particularproblem started or was worsened at that factory, in that year?
Because this component of the social security system is designedaround the idea of a formal employer-employee relationship, informalworkers are excluded from coverage. Yet short term injury or longer termdisability will directly impact on their ability to earn an income. Interestingly,a key component of the health insurance scheme for informal women workersdeveloped by the Self Employed Women's Association (SEWA) in India iscoverage for short term disability in order to ensure the continued capacity towork and earn. A similar benefit is available in Tanzania's UMASIDA.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
186 Social Security and the Changing Labour Market
Adult South Africans can get access to the (means tested) stateDisability Grant, and in June 2002 there were approximately 724 000beneficiaries. For those disabled informal workers who can get access to theDisability Grant, the cash transfer is a vital lifeline of support into thehousehold. The transaction costs of getting the grant are, for most people,extremely high. Further, it does not assist with temporary disability.
Maternity
Formal social security systems recognize the importance of protectingworking women preparing for, during and after child birth through theprovision of maternity benefits, specifically paid leave. Maternity is includedin the ILO list of core contingencies. Access is usually dependent on priorcontributions of both employee and employer. There are large countrydifferentials in periods of leave, which commonly range between 12 and 16weeks (the European Union defines a leave of at least fourteen weeks). Therehas been a growing trend for the provision of paternity leave as well. Orloff(2000: 14) reports on research which shows that where such paternity leave isavailable in European countries, only a small minority of men actually takethis benefit up. Access to maternity benefits in the majority of OECDcountries excludes one or all of the following: casual workers, family businessemployees, domestic workers (Orloff, 2000: Table 3).
In South Africa, formal workers with a record of contributions areeligible for maternity benefits. Some trade unions have negotiated forpaternity leave as well. Informal women workers bear the same type of risksas all women in bearing and giving birth to children; they have no access towork-related maternity provision. Through the public health system they dohave access to free reproductive health services, which include maternity care,post natal care, and also access to free abortion. The time away from workobviously leads to reduced income, at a time when more demands are beingmade on the household resources because of the newborn. The stresssurrounding early return to work will heighten the risks to the health status ofthemselves and their children.
Child care
Child care has not typically been one of the core contingencies covered bysocial security systems, and is usually classed as a 'social service'. However,given the changing patterns of labour force participation internationally, theemployment of increasing numbers of women, and the increase in single
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 187
parenting, it may be time to locate child care as an essential part of anypackage of social security. For as long as the gendered division of domesticand reproductive (unpaid) labour remains, ways will need to be found to helpreconcile the conflicting demands for employment and for supporting familylife that many women face. This includes their care not only for children, butalso for frail and elderly family members where state or private facilities areunaffordable or unavailable (often as a specific outcome of neo-liberaleconomic policies which cut back and/ or privatize health and welfareprovision).
Many industrialised countries have recognized the link betweenincreased employment of women, and the need for publicly-funded child care.A selection of OECD countries which differ widely in terms of their level ofeconomic development (Denmark, Finland, Greece, Italy, Netherlands and theUnited Kingdom) have over 50 percent of three to six year olds in publiclyfunded child care facilities (Orloff, 2000: Figure 22).
South Africa has little in the way of work-related child care facilities,with only occasional examples of employer- or employee-supportedprovision. Traditionally, community-based collective facilities have beenprivately provided, and sometimes subsidized by government.
It is not clear that child care is necessarily a priority concern for socialprotection for formal or informal women workers in all regions, and in allworking situations. In countries with high unemployment, there may be otheradults at home who are able to care. In South African research on streetvendors, these workers were mixed in their opinions about whether havingnearby child care facilities would be useful. Workers certainly saw thepresence of young children with them at their sites as problematic for business(Lund and Skinner, 1999). There may be an advantage to home-basedworkers of working at home, as this allows them to combine their work withtheir domestic work. This obviously affects income-earning ability, however,as work will be interrupted through the day.
Women who are seasonal workers have special child care needs,particularly when the economic seasonality means that the heaviest workingperiod coincides with special educational periods for children, for exampleover exam time. However, seasonal workers in some industries may have anadvantage because of the employment of large numbers of women by thesame employer, in the same place. This may make it easier to bargain forwork-based child care facilities.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
188 Social Security and the Changing Labour Market
In South Africa, low-earning informal workers have access to the ChildSupport Grant, eligible to the primary care giver of children up to the age ofseven. Introduced in 1998, there were approximately 2,149,000 beneficiariesby June 2002, and this number should double by the time the grant matures in2005. Other grants in the field of child care for which informal workers areeligible are the Care Dependency Grant for children up to the age of 18 whohave profound disabilities. It is exceptionally difficult and expensive toaccess: In June 2002 it was being paid to carers of some 37 000 children only.The Foster Care Grant goes to carers of approximately 100 000 children. It isunlikely that many informal workers qualify for this grant, as incomes have tobe steady enough to justify the judicial replacement of a child^ naturalparent(s) with foster carers.
Old age
Old age is a core contingencies included in most social security systems. Theincreased longevity of people in industrialised and in many less developedcountries has led to increasing concern about financial provision for theretirement years, and indeed to a widespread perception of crisis in thepensions industry world wide. Characteristics of pension reforms inindustrialized countries have been a move towards more private provision,increases in the pensionable age, equalization of the age of eligibility asbetween men and women (women traditionally receive benefits at an earlierage), cost containment, and savings through better management (Lund andSrinivas, 2000: 25).
In South Africa, a relatively small proportion of the population iselderly. Formal workers contribute to retirement schemes through the placeof work. Those who can afford to do so top it up with investments in privateannuity and retirement schemes. Two national committees of enquiry intoprovision for retirement (the Mouton Committee in 1992 and the SmithCommittee in 1995) as well as a World Bank investigation came to the sameconclusions: there is good retirement coverage for those who are in formalwork; the huge insurance industry has been a stable mainstay of the economy;but for many who have access to schemes, their contributions throughouttheir working life are so small (because wage levels are so low) that thereceived benefit cannot ensure financial independence; thousands of peoplewho do work did not have access to retirement benefits (especially migrantworkers); and many people have never worked in the formal economy at all.Since those investigations, increasing numbers of non-standard workers and
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 189
full time workers whose jobs are being contractualised are losing access toretirement schemes.
With regard to encouraging even small private savings towards old age,the government so far has not had a good record. There have been fewincentives to save, in the sense of poorer people having access to financialinstitutions with low transaction costs. Further, it simply is difficult toreconcile the need of poorer people for small amounts of money for presentneeds, with the longer terms need to conserve for later on.
South Africa is one of the few countries in 'the south' to have anextensive non-contributory pension for elderly people. The state Old AgePension is a means tested monthly cash transfer, payable to women from age60 and men from age 65. About three quarters of elderly South Africans getsthis benefit; in June 2002, there were 1,913,000 beneficiaries, receiving R620per month (increased to R640 later in 2002). The economic and socialimpacts of the OAP have been intensively studied, and it has been found to bea relatively efficient and well-targeted form of assistance. It assists theelderly themselves, and also the members in the households in whichpensioners live (Ardington and Lund, 1995; Case and Deaton, 1998; Lund,2002).
Delgado and Cardoso (2000) write about the providencia rural inBrazil which has a component of non-contributory social assistance to elderlypeople in rural areas. They demonstrate the positive socio-economic impactsof the grant for the reduction of poverty among elderly people, enhancing thesocial position of elderly people, and especially of elderly women, its use forhousehold investment in agricultural production, and as a mechanism forallocation of resources to rural areas. These positive findings echo almostprecisely the main positive claims made for the impact for the South Africanpension (Ardington and Lund, 1995).
A Conceptual Framework for Social Protection for Workersin the Informal EconomyIt is clear that the access of workers to occupationally-related social securityhinges on a defined employer-employee relationship. Although manyinformal workers do in fact have employers, the relationship is by definitionill-defined and informal. For non-standard and informal workers to get accessto social security, a conceptual approach is needed that is grounded in theworking reality of workers of different labour statuses, and recognition that
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
190 Social Security and the Changing Labour Market
these 'atypical' forms of work are becoming part of a permanent norm.4
There are four essential elements for such a framework: (1) Viewing thewhole economy as a continuum, with a more formal end and a more informalend; (2) analysing the risk and vulnerability faced by workers through thedifferent sectors in which they work (for example textiles, construction,services), and focusing on different status of employment at differentpositions in the chain of production; (3) applying a gendered analysis of thesector and of access to benefits - including gender concentration, earnings,access to social security as 'worker' or as 'dependant', job security aroundmarriage and child birth, and the link between unpaid labour at home and paidlabour at work; and (4) analysing the regulatory environment governing workat different points in the chain. These will be dealt with in turn.
The continuum
There is a conscious move away from the term 'informal sector'. Using theterm 'sector' to distinguish the formal and the informal makes it impossibleanalytically to understand the processes through which the informalization ofthe formal economy happens, or to appreciate the great diversity within theinformal economy itself, or to place the lens on the linkages between theformal and the informal parts of the economy - which are important links inany efforts to 'grow' and regulate informal enterprises.
Integrating social protection into value chain analysis
In each sector - garments, information technology, agriculture, etc. - there isa chain of activity, from design and production of the commodity (orprovision of the service) to distribution and final consumption. Chains maybe short or long. An entire chain might be present in one country, or mayspan different countries. People work in different contractual statuses atdifferent points of the chain. Many workers may not know who is theemployer or owner; they only know the labour broker or materials supplier.Chain analysis enables an understanding of the global nature of productionand distribution in particular sectors, how informal workers are linked intoglobal chains, and at what points along the chain workers in differentcategories get access to or excluded from which measures of social protection.
Gendered analysis
In the absence of social service and social security provision by the state orprivate sector, women do much of the domestic caring work. Diane Elson has
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 191
pointed out that labour markets are themselves gendered institutions, or'bearers of gender' (Elson, 1998). Women on the whole earn less than men,and have a lower ceiling in terms of career advancement. In the industrialisedcountries with developed welfare states, many women's access to insurance-based social security came through their working husbands' medical aid orretirement pension. Patterns in which more women now work, there are moremen and women in part time and temporary work, and there are fewer men infull time permanent employment, all affect the access of men, women andchildren to social support.
Regulatory environment and labour status
Increasing risks and vulnerabilities are attached to work as one moves towardsthe more informal end of the production chain, and the further removed iswork from the aegis of formal regulations governing standards of work. Inthe clothing industry, for example, at the most protected end would be aworker in a formal factory, with a long term contract, a reliable wage, anexpectation of advancement. She would have paid holidays and sick leave,full access to UIF, a pension fund, maternity (and paternity) leave, workerscompensation, and access, through a union, to voice in and control over theworking environment. At the very informal end, a home-based worker maybe sewing parts of garments at a piece rate, would not know who heremployer is, but only know the broker of materials; would have no voice orcontrol; and may in turn be 'employing' children or other adults for no pay.She would have no access to any work-related social benefits.
There are many working statuses in between these two ends of thespectrum. These may be people who have been contractualised, or doingseasonal work, or doing part-time work. As less work is performed under theaegis of labour regulation, more of the conditions of work are determined byrules and regulations and practices, both formal and informal, which governproduction in a particular sector or industry. As Theron and Godfrey (2000:54) point out, in South Africa (and internationally) a labour law regime isbeing replaced with a commercial contractual regime.
This approach to social protection - which sees the economy as awhole, with workers in different labour statuses and different genderedpositions within different sectors, differentially affected by formal andinformal regulatory practices - creates a number of new analytical andpractical spaces. As we have asked elsewhere: 'Under what conditions canwhat kinds of workers in the informal economy (and especially poorer
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
192 Social Security and the Changing Labour Market
women) get access to what core measures of provision, which can beincrementally improved on in future?' (Lund and Srinivas, 2000: 2)
It provides the means to focus on the diversity within the informaleconomy, and of different programmes and forms of provision. It helps tomitigate against the 'policy fatalism' that can accompany discourses aboutglobalisation and inequality. Also, it is integrative. It works directly againstthe problematic notion of the 'marginalisation' and 'exclusion' of workers inthe informal economy. Social security policies of the future need to moveaway from the creation of 'special programmes', and worse, 'specialprogrammes for marginalized women', as if they are atypical minorities withtemporary special needs. There is a need for systematic reform of the wholesystem of social protection, which takes into account the fact that manypeople may work for their whole lives, and yet remain poor.
Third, the approach allows a focused analysis of concrete institutionalenvironments. It allows for a cross section to be taken at different pointsalong the continuum within each sector, from more formal to less formal, andto ask, at each point: Which are the institutions and interest groups bestplaced, at that point, to pursue the agenda of and make contributions toimproved social protection? At what points along each chain would it bepossible to introduce new measures of protection? How far and under whatconditions can existing mechanisms be made to penetrate towards the lessformal and less protected end - where workers are still workers, but wheremore are women in low paid work, or in family-employment or self-employment? At what points down the chain are different institutions active?The state? Or employers? Or the private insurance industry? At what pointdown the chain do workers have to be unionised or organised in some otherway in order to get access to protection measures? At what point down thestrand is the only agency present (apart from individuals themselves) activitiesby NGOs? And what does this mean for sustainability^ and for scale, and foroutreach towards poorer people? What do all of the above mean for what thecore tasks of government are, in support, provision, and in providing anenabling climate for others?
/Areas for Enquiry and Reform
The paper has reviewed some of the contingencies and risks faced by workers,with the focus on informal workers, and especially poorer women. SouthAfrican informal workers get access, as citizens, to some measures ofprovision - such as free health care, the Old Age Pension, the Disability
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 193
Grant, the Child Support Grant. These are all publicly provided measures.Strictly private measures such as formal savings and insurance schemes areunaffordable to poorer people. I have suggested the need to move towards anapproach to social security which keeps open a role for multiple actors - thestate, owners of capital, workers themselves - which is sustainable, whichanticipates that the informal economy will grow, that 'atypical work' willbecome more typical, and that institutions need to be built which can givebetter protection to formal and informal workers. This should besupplementary to the measures of social provision already coming from thestate.
The rationale for the Basic Income Grant advocated by the TaylorCommittee is grounded in the reality of the working poor, and the numberswho are unemployed or erratically employed. What is needed in South Africais something that is in fact more generous, and more comprehensive -comprehensive not in the sense of 'being bigger', but in the sense of engagingwith and building on existing healthy institutions, enabling the mainstreaminstitutions to extend their services.
In what follows I raise some questions about possible new ways ofusing or reforming existing institutions, and the design of other new ones,which keep alive a strong role for the state, as well as for others - but whichdo not, as in too many other designs for 'the poor', expect the poor to takemost of the responsibility for managing risks and getting out of poverty.
Financial institutions: banking and insurance
Many poor people want to save, and are able to do so, but are constrained bytheir inability to put aside fixed amounts of money at regular intervals (asrequired by most contributory schemes), or by the lack of access of bankinginstitutions (either because they are too far away, or because their rules forentry and continuance incur too high a cost) or because savings have to bedrawn down because of unforeseen crises. In recent years, the numbers ofPost Offices (which served as vital financial and communications centers forpoor people, in rural and urban areas) have decreased; the cost of using bankshas gone up; and both formal and informal insurance becomes actuariallymore difficult in the presence of the AIDS epidemic of the size it is in SouthAfrica.
South Africa has a very well developed cash transfer system, with theprivate sector delivering the state-provided benefits. It also has very welldeveloped and sophisticated banking sector and insurance industry. This is
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
194 Social Security and the Changing Labour Market
unlike the situation in many other developing countries, where significantresources have been invested in designing and developing savings andinsurance schemes, outside the formal financial sector, specifically for poorpeople. Is it possible or desirable to design a contributory savings scheme,using mainstream financial institutions, with government for exampleproviding incentives to the institutions to do this? What would be needed toget the right degree of flexibility that such a contributory scheme would beattractive to informal workers (and to others). Such reform of financialinstitutions is not meant as a substitute for micro-savings smaller schemes thatwork; it suggests that larger institutions may be able to offer a more enduringinstitutional context for larger numbers of people.
There has been a worldwide growth in the numbers of micro-insuranceschemes, many of them in the field of insurance for health. With fewexceptions, such as the Grameen insurance scheme in Bangladesh (anoffshoot of the Grameen Bank), and SEWA's integrated insurance scheme,each of which insures more than sixty thousand people, these initiatives havenot shown their ability to reach large numbers of people on a sustainablebasis. Given the huge size of the South African insurance industry, whatmore could it do to reach out further to poorer people - again, possibly withsome underwriting from government in the short term, and even in the longerterm?
With regard to the insurance of assets and equipment, could existinginsurance be extended to cover more non-standard and informal workers,especially for people doing waged work for others, in their own homes orsmall informal factories? A man may be stitching shoe pieces in his home inthe evenings and at weekends, for a factory owner for whom he also works inthe factory during weekdays. His stitching equipment and stock are stolen.The factory itself is insured. Could the definition of 'place of work' beextended to cover work equipment and assets in a private home? Theron andGodfrey (2000) have suggested the need for further legal exploration of thedefinition of 'place of work' in labour legislation, and it would be useful toaddress the insurance issue quite specifically.
COFESA's role in eroding workers' rights to social security
During the 1990s South Africa introduced a suite of new legislation relating tolabour conditions (principally the Labour Relations Act, the Basic Conditionsof Employment Act and the Employment Equity Act) as well as new legalmechanisms for dispute resolution. While the legislation is in many respects
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 195
progressive, implementation is retarded because of lack of infrastructure,including personnel, for monitoring and enforcement. Parallel to thedevelopment of this legislation has been the appearance and rapid growth of anew model of regulation which seeks to erode the security and status ofworkers. The Confederation of Employers of South Africa (COFESA) wasset up in 1990 as an employers' organization and as a labour consultancy(Skinner and Valodia, 2002). Its chief function has become specifically toenable manufacturers to operate outside of the labour legislation andregulations, including the occupational health and safety domain.
The following extract is from the 'memorandum of agreement'whereby a worker, now 'the Independent Contractor', agrees to producegoods for 'the Company':
Clause 1: The Contract: The Contractor shall contract his service to theCompany on an ongoing basis. It is expressly agreed that the Contractor shallnot be employed by the Company and that this agreement shall not be construedas a contract of employment. ... The Contractor is therefore not entitled toprotection in terms of the Labour Relations Act 66 of 1995. ...
Clause 12: The Contractor will at all times adhere to the provisions of theOccupational Health and Safety Act 85 of 1993. ... and will register himself interms of the Compensation of Occupational Injuries and Diseases Act 130 of1993.
The first clause operates directly against the spirit and letter of the basiclabour legislation. Clause 12 goes further and makes all 'independentcontractors' responsible for their own occupational health and safety - whichhas conventionally been received through formal work. Additionally,COFESA firms do not have to make contributions to pension funds, medicalaids, unemployment funds or training schemes (Skinner and Valodia, 2002).Yet repeated attempts to tackle COFESA in court have failed. South Africaappears to be accommodating a dual set of labour practices, increasingnumbers of people operating outside the aegis of the new legislationprotecting labour standards.
It is clear that many poorer workers would rather have a job with a lowincome, in exploitative conditions, than to have no income at all. It is not atall clear what gains would be made - and sustained - through the path oflitigation alone, given that so much of the practice of work is beyond thereach of the monitors and inspectors of the law.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
196 Social Security and the Changing Labour Market
The role of local government
Local governments have been mandated by the Constitution to promote localeconomic development, and to support informal enterprises as well as formalones. WIEGO research has shown that the most basic security, for workers, isprovided where local governments create spaces and opportunities wherepeople can work (Lund and Skinner, 1999). This does not have to be inimicalto the need for orderly management of public places. Clearly, the first basicstep is that local authorities desist from harassing informal workers andconfiscating or destroying their assets. Secondly, the institutional location ofinformal workers and their enterprises is significant (Skinner, 2000); beinglocated in Economic Development, as in Durban, as opposed to Traffic, orCleansing, as in some municipalities, reflects the recognition that streettraders or home workers are seen as economically active people.
The provision of affordable and reliable basic municipal services isessential to both security for and the productivity of homebased workers.Rates and fee structures which are progressive and pro-poor (through ratesexemptions, or sliding scales for tariffs, for example) directly impact onlivelihoods - not just for survival, but for the sustainability and growth ofsmall enterprises. Furthermore, there is much that local authorities can dousing existing municipal assets and within existing available resources to helpbuild organizations of informal workers. The provision of meeting spaces,translations services, legal advice about constitutions and tax registration,information dissemination are all examples of this.
Reforming institutional arrangements for 'health' at local governmentlevel
The field of occupational health and safety is restricted to formal places ofwork - shops, offices, factories - and is exercised through the Department ofLabour. Increasing numbers of people working informally, at home (insideand outside) and in public places such as streets and informal markets. Localgovernment exercises authority over health standards in these places.However, the way in which health spheres and functions are defined, and arearranged institutionally within local authorities, makes it difficult for the localauthority to respond in appropriate ways to concrete problems thrown up bynew forms of work. An example from Durban makes this clear.5
A resident phoned the City Health Department to complain about herneighbour. He is an informal backyard mechanic. The day before, he had
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 197
been spray painting a car. The prevailing wind direction changed, and all theclothes on her washing line were now lime green. She wanted to know whatthe City Health could do. The city official did not know to which departmentto refer her. Occupational health and safety deals only with formal places ofwork, not informal enterprises in backyards; it was not an environmentalhealth problem as it was a complaint against an individual in a private home;it was not really a public health problem. The way in which environmentalhealth, public health, and occupational health are defined made it difficult foranyone in the health department to respond to this most ordinaryneighbourhood problem.
This seemingly trivial example illustrates a really profound institutionalproblem: bureaucracies for government are structured in ways which may (ormay not) have been appropriate for the beginning of the twentieth century;they are not so at the beginning of the twenty-first.
Sectoral Education Training Authorities (SETAs)
Skills development and the development of human capital are an importantform of ensuring both the fulfillment of human potential and economicsecurity. Informal workers typically lack access to training and supportservices that are available to formal workers through the workplace. TheSETAs, which are a new institution in the Department of Labour, have astheir primary aim to skill the South African work force. Informal workers fallwithin their scope. SETAs may offer real potential for building skills forinformal workers, and for developing the kind of capacity which would enableinformal workers to get access to social protection.
It is not yet clear - and would merit a special focused study - howinformal workers get access to SETAs as a whole, including the skillstraining, as well as the funds which are employer-contributory. What kinds oflearnerships could be open to informal workers? What forms of organizationwould informal workers have to have to get access to learnerships? What isthe scope for skills training which could help build work-based programmesof social protection, and more understanding about the need for and role ofinsurance?
Informal workers with disabilities
Improved access for people with disabilities is about changed attitudes andchanged labour policies, as well as about environmental barriers that standbetween people with disabilities and places of employment. The government
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
198 Social Security and the Changing Labour Market
in alliance with the movement for people with disabilities could catalysedifferent departments to think about and act upon policies which will over themedium to long term enable people to live independently and make provisionfor themselves. The government could play a role in raising awareness ofhow societal attitudes are a barrier to the integration of people withdisabilities; influence those in Trade and Industry, Labour, Education, and theprivate sector, to develop integrative labour policies; and influence theDepartment of Transport to improving access to work for poorer disabledpeople by regulating the design of public carriers, and supporting initiativessuch as Dial-a-Ride in Cape Town.
Organisation and representation of informal workers
The extension of social security coverage to informal workers will onlyhappen if they themselves have strong organizations to represent theirinterests, i.e. if they develop 'voice' and accurately identify the platforms onwhich to exercise that voice and work collectively towards improvedconditions of work and better access to social security. A few organizationsof informal workers, such as India's SEWA and the embroiderers' union inMadeira, Portugal, have reached the size and/or had the influence to negotiatefor material improvements in access to social security. SEWA, with 400 000members, has built its own scheme of social insurance. The Union ofMadeira Embroiderers negotiated first to be included in the regionalguaranteed benefits for old age and disability, and then to be covered by thenational Portuguese statutory social security system which included incomecoverage for periods of illness and maternity leave.
A few trade unions have assisted informal worker organizations andinformal workers to improve their access to productive assets, and to socialprotection. FNV in the Netherlands for example has promoted the idea offormal unions assisting organizations of informal workers (Tesselaar, 1998).A major union federation in Ghana is investigating ways of letting informalworkers use the union's provident fund as collateral in getting small loansfrom banks to build their informal enterprises. Organisations such as CBOs,NGOs, and religious associations have played roles in developing buildingnew models of provision, and in acting as a monitor and watchdog overgovernment. In South Africa, advice offices and human rights organizationssuch as the Black Sash and the Legal Resources Centres have played an activerole in defending the rights of elderly and disabled people to the state
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 199
pensions and grants, the rights of unemployed people to UIF, and the rights ofworkers to workers compensation.
There is a tendency in the approach of FNV to see the role of labourorganizations as themselves leading the organization of informal workers.Stronger articulate organizations of informal workers (such as SEW A, theUnion of Madeira Embroiderers, and SEWU in South Africa) insist on havingdirect representation on significant platforms where worker rights are beingdiscussed. The international alliance of street vendors, StreetNet, wasformally launched in Durban in 2002, bringing together vendors from as farafield as Korea, Philippines, Bangladesh, and India; Benin, Ghana, and SierraLeone; Bolivia, Colombia and Peru. It is central to StreetNet's approach topush for direct representation for informal workers.
ConclusionThere are wide variations in the scope and coverage of social securitysystems, within and between industrialized and developing countries. I havedescribed how, in South Africa, formal workers have access to an extensivearray of social security measures, modeled on those in northern welfare states,and including coverage for most of the ILO's core contingencies. For toomany formal workers, however, key problems are that the level of benefits islow, unemployment benefits were designed for short-term not long-termunemployment and workers compensation remains difficult to access. Forincreasing numbers of people who are doing 'atypical' or contractualised yetstill formal work, access to social benefits is rapidly being eroded - and theconscious energy of one large and growing employers' association is directedat this purpose.
Informal workers in South Africa have access to a number of state-provided non-contributory benefits - particularly for their years of retirement,for disability, and for child support - which are unusual for those indeveloping country contexts. Many of the poorest South Africans live inhouseholds with three generations, and the Old Age Pension, for example, isknown to 'buy' both support for small enterprise developments, and supportfor child care. Furthermore, the exceptionally high rates of unemploymentmean that for many informally working mothers and fathers, there are otheradults present in the home who can provide childcare.
The entire system of state, private sector, and privately providedsupport will be under extreme pressure as more people become ill and die
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
200 Social Security and the Changing Labour Market
with HIV and AIDS. There is a looming crisis in terms of the numbers ofchildren who will be orphaned. On the employment front, employers arehaving to deal with higher rates of absenteeism, and more deaths of youngworkers. Unless the economy shows signs of rapid growth, it is likely thatmore people will enter informal work and start informal enterprises.Development debates in South Africa still tend to see the poor as not working,and as 'marginalised'. There can be no secure future in South Africa unlessthere is greater recognition that masses of people who are poor are workinghard, yet never get access - through their role as workers - to benefits whichhave been associated with the place of work; and unless measure are exploredwhich seek to enhance their security.
Atypical and informal work have become a permanent and growingfeature of contemporary labour markets in both industrialized and developingcountries. There has been too little acknowledgement of the economic andsocial consequences that have been occasioned by the increasing participationof women in the labour market, yet not being relieved of the primaryresponsibility for unpaid labour, done at home, in domestic and caring work.This leads to a fundamental contradiction when, as in South Africa, in aconservative economic policy environment, calls are made for 'communitycare' and 'voluntary work' as a policy response to the increase in the need forhealth, welfare and caring due to AIDS and its associated diseases. Moredemands are being made on women, in their own homes, in 'the community',and at work. And the conditions under which increasing numbers of womenand men work mean that they will be excluded from adequate social securityprovision.
The diversity within the informal economy makes it difficult toconstruct a generalized account of appropriate measures that would suit allpeople. Their needs and demands will be dependent on their access to othermeasures of provision, through public or private means. The need for healthservices would depend for example on whether there is affordable public orprivate health care; the need for child care will depend to some extent on thefamily structures and patterns of caring in a particular setting.
It will be extremely difficult to reconcile the need to protect standardsof work, and insist on employer responsibility for aspects of social protection,while at the same time encouraging the creating of new employment, and notshedding existing employment. It will be a challenge to develop a socialsecurity system that does more to promote and support the capacity of poorerpeople to participate in and build their own insurance organizations, or
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 201
participate in new forms of insurance within formal institutions. And, what isthe appropriate balance in the responsibility between the state on the one side,and the owners of capital, and employers on the other, who quite literallydisappear to the informal workers, because of their position at different endsof the long chain in the production process at which each is placed?
The assertive campaign by alliances of labour, human rights, and healthand welfare organisations for the Basic Income Grant will continue, while inparallel the government is likely to respond by conceding a few more years ofeligibility for the Child Support Grant (which should in itself be welcomed asa significant reform) as well as calling for more 'community care'. What isalso needed, now, is an exploration of a range of additional mechanismswhich are intermediate between 'the state' and 'the community', and inparticular which pin down the responsibilities of owners of capital and extractfrom them their dues. Such mechanisms should attempt to extend the reach ofexisting institutions and agencies such that they accommodate the needs ofgrowing numbers of workers for social security and protection.
Francie Lund is an Associate Professor in the School of Development Studies,University of Natal, and Research Director of the Social Protection Programme of theinternational network WIEGO (Women in Informal Employment: Globalising andOrganising (www.wiego.org')'). Her email address is: [email protected].
References
Ardington, E. and Lund, F. 1995. 'Pensions and development: social security as complementaryto programmes of reconstruction and development'. Development Southern Africa,12(4): 557-577.
Atim, C. 1999. 'Social movements and health insurance: a critical evaluation of voluntary, non-profit insurance schemes with case studies from Ghana and Cameroon'. SocialScience and Medicine, 48.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
202 Social Security and the Changing Labour Market
Barrientos, A. 2001. 'Women, informal employment, and social protection in Latin America'.Paper prepared for the conference, Women and work: a challenge for development.Meeting of the Board of Governors of the InterAmerican Development Bank,Santiago, March.
Barrientos, A. and Barrientos, S. 2002. 'Social protection for workers in the informal economy:case study on horticulture in Chile and South Africa'. Unpublished paper prepared forthe WIEGO, ILO and World Bank Technical Consultative Workshop on SocialProtection for Informal Workers, Chamonix, April.
Barrientos, S., McClenaghan, S. and Orton, L. 1999. Gender and codes of conduct: a casestudy from horticulture in South Africa. London: Christian Aid.
Budlender, D., Buwembo, P. and Shabalala, N. 2002. 'Country case study: South Africa.' Paperprepared for the International Labour Office, Geneva.
Case, A. and Deaton, A. 1998. 'Large cash transfers to the elderly in South Africa'. EconomicJournal, 108, September. 1330-1361.
Cassiem, S. and Streak, J. 2001. Budgeting for child socio-economic rights. Cape Town:IDASA.
Chen, M., Jhabvala, R. and Lund, F. 2002. Supporting workers in the informal economy: apolicy framework. Employment Sector: Working Paper on the Informal Eocnomy No.2. Geneva: International Labour Office.
Cross, C, Mngadi, T, Mbhele, T, Masondo, P, and Zulu, N. 2000. 'Inside the invisibleeconomy: Home based workers in poor settlements of the DMA'. Interim WorkshopReport, ILO Employment Issues and Opportunities Project, February.
Delgado, G. and Cardoso, J.C. 2000. Principals Resultados da Pesquisa Domiciliar sobre aProvidencia Rural na Regliao Sul do Brasil, Texto para Discussao 734, Rio deJaneiro: Institudo de Pesquisa Economica Aplicada.
Devereux, S. 2001. Social pensions in Namibia and South Africa. IDS Discussion Paper 379.Brighton: Institute of Development Studies, University of Sussex.
Devey, R., Skinner, C. and Valodia, I. 2002. 'The informal economy in South Africa: who,where, what, and how much?' Paper presented at the Development Policy ResearchUnit Second Annual Conference on Labour Markets and Poverty in South Africa,Johannesburg, October.
Fadane, N. 1998. 'Women street vendors and housing in Durban'. In Larsson, A., Mapetla, M.and Schlyter, A. (eds.): Changing gender relation in South Africa: issues of urbanlife. Roma: The Institute of Southern African Studies.
Hart, G. 2002. Disabling globalization: places of power in post-apartheid South Africa.Pietermaritzburg: University of Natal Press.
ILO. 2002. Women and men in the informal economy: a statistical picture. Geneva:International Labour Office, Employment Sector.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 203
Jhabvala, R. 2000. 'Participatory approaches: emerging trends in social security', in Jhabvala,R. and Subrahmanya, RKA (eds.): The unorganised sector: work security and socialprotection. New Delhi: Thousand Oaks and London: Sage.
Kiwara, AD. 1999. 'Health insurance for the informal sector in the United Republic ofTanzania'. In van Ginneken, W. (ed.): Social security for the excluded majority.Geneva: International Labour Office.
Lund, FJ. 1997. 'Social security for disabled people in South Africa'. In de Jong, P. andMarmor, T. (eds.): Social policy and the labour market. Aldershot: Ashgate: 363-377.
Lund, F. 2001. 'A framework for the comparative analysis of social protection for workers inthe informal economy.' Paper presented at the Annual Meeting of the Inter AmericanDevelopment Bank, Santiago, March.
Lund, F. 2002. 'Crowding in care, security and micro-enterprise formation: revisiting the roleof the state in poverty reduction, and in development'. Journal of InternationalDevelopment, 14(6): 1-14.
Lund, F. and Skinner, C. 1999. Promoting the interests of women in the informal economy: ananalysis of street trader organizations in South Africa. School of DevelopmentStudies: Research Report No. 19. Durban: University of Natal.
Lund, F. and Srinivas, S. 2000. Learning from experience: a gendered approach to socialprotection for workers in the informal economy. Geneva: International LabourOrganisation.
Motala, S. 2000. An investigation of the links between formal and informal businesses in theclothing industry in the Durban CBD. Study 2.2. Research Report for Technical TaskTeam for the Informal Economy, May.
Orloff, S. 2000. 'The significance of changing gender relations and family forms for systems ofsocial protection'. Background paper prepared for the World Labour Report 1999-2000. Geneva: International Labour Office.
Reynaud, E. 2002. The extension of social security coverage: the approach of the InternationalLabour Office. Extension of Social Security (ESS) Working Paper Series: No. 3.Geneva: International Labour Office.
Sagner, A. 2000. 'Ageing and social policy in South Africa: Historical perspectives withparticular reference to the Eastern Cape'. Journal of Southern African Studies, 26(3):523-553.
Skinner, C. 2000. 'Getting institutions right? Local government and women street traders infour South African cities'. Urban Forum, 11(1).
Skinner, C. and Valodia. 2002. 'Labour market policy, flexibility, and the future of labourrelations: the case of the KwaZulu-Natal clothing industry'. Transformation 50: 56-76.
South Africa, 2000. Intergovernmental Fiscal Review 2000. Pretoria: National Treasury.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
204 Social Security and the Changing Labour Market
South Africa. 2002. Transforming the present -protecting the future. Consolidated Report ofthe Committee of Inquiry into a comprehensive system of social security for SouthAfrica.
Standing, G. 1999. Global labour flexibility: seeking distributive justice. London: Macmillan.
Standing, G., Sender, J. and Weeks, J. 1996. Restructuring the labour market: the SouthAfrican challenge. Geneva: International Labour Organisation.
Subrahmanya, RKA. 2000. 'Welfare funds: An Indian model for workers in the unorganisedsector'. In Jhabvala, R. and Subrahmanya, RKA (eds): The unorganised sector: worksecurity and social protection. New Delhi.: Thousand Oaks and London: Sage.
Tesselaar, A. 1998. Organising in the informal economy: the role of trade unions. Amsterdam:FNV Mondiaal.
Theron, J. and Godfrey, S. 2000. Protecting workers on the periphery. Development andLabour Law Monographs 1/2000. Cape Town: Institute of Development and LabourLaw, University of Cape Town.
Valodia, I. 2001. 'Economic policy and women's informal work in South Africa'. Developmentand Change, 32(5).
Van der Berg, S. 1997. 'Social security under apartheid and beyond'. Development SouthernAfrica, 14(4): 481-503.
Appendix: Diversity in the informal economy
Caterers for big events, caterers for school tuck shops
Live chicken sellers
Child carers
'Bush mechanics' — panel beaters, spray painters, radiator repairs
Unregistered taxi drivers
Cardboard collectors
Commercial sex workers
Newspaper vendors
Mielie cookers, as well as those who sell to mielie cookers, and suppliers of
wood and water to mielie cookers
'Pinafore' ('German print') makers and sellers
Second-hand clothes dealers
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
Francie Lund 205
Shoe makers, shoe polishers, and shoe repairersSellers of sea waterTyping at homeSelling by Internet at homeHair dressers at home and on the streetShoe makers, candle makers, block makersFruit and vegetable sellersGarbage pickersSpaza shop owners and spaza shop workersMr. Phone dealers and community phone managersChemical drum sellersInformal construction workersMuthi tradersBovine head cookersCraft workers - beads and drums and knob-kieries and sculpturesShebeen ownersCosmetics sellersMakers of security fencing and doors and guard
(Source: Fact Sheet 1 in Policy for the Informal Economy in Durban, October 2000)
Notes
1 I follow the definitions here which appear in the recent International Labour Office(ILO) paper on measurement of the informal economy (ILO, 2002). Non-standardwork - a term used primarily in an industrialised country context - is work donewithin the scope of regulatory labour standards measures, but which deviates fromthe 'norm' of being full-time and/or secure, for example part-time work, temporarywork, and self-employment. The expanded ILO concept of informal employment isunderstood to include all remunerative work - both self-employment and wageemployment - that is not recognized, regulated, or protected by existing legal orregulatory frameworks and non-remunerative work in an income-producingenterprise (ILO, 2002: 12).
2 In past labour force and household surveys, questions have been poorly asked andnumbers under-estimated. Recently this has improved, but uncertainty remains as to
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014
206 Social Security and the Changing Labour Market
how much of the recorded in crease in the numbers of informal workers andenterprises reflects better data-gathering, or real increases.
3 Figures regarding state grants here and in later sections were supplied by Nationaltreasury, and were correct at June 2002.
4 This conceptual framework for social protection presented in this section is beingdeveloped in and through the international advocacy network, WIEGO - Women inInformal Employment: Globalising and Organising. This is a collaboration betweenassociations of informal workers, researchers, and international agencies concernedabout and working towards promoting the economic position of workers andenterprises in the informal economy.
5 I am grateful to Kevin Bennett, from Ethekwini City Health Department, for thisexample.
Dow
nloa
ded
by [
Uni
vers
ity o
f C
alif
orni
a Sa
nta
Cru
z] a
t 23:
40 2
4 N
ovem
ber
2014