Report No. 24378 Tkh;i ndA UUfI Itr y L1V;IUM I I MiA rIctl LI U N IIJ S.ocJ.Iai I I P tLectLiorI June 2002 Human Development Sector Unit East Asia and Pacific Region Document of the World Bank Thailand - Country Development Partnership 5VrcinJ Prnfpc,tirrn KINGDOM OF THAILAND - FISCAL YEAR October I - September 30 CURRENCY EQUITVALENTS (as of June 24, 2002) Cu r-e n cy Uni t = BoahIlt (B)n US$ 1.00 = B 41.93 ABBREVIATIONS ADB Asian Development Bank AFR Africa Regional Office ASEM Asia Europe Meeting AUSAID Australian Agency for International Development CAS Country Assistance Strategy CDP-PIU Country Development Partnership - Project Implementation Unit CDP-SP Country Development Partnership - Social Protection CEP Comprehensive Employment Policy CERCAP Community Empowerment for Response to Crisis Action Plan CSOs Civil Service Organizations DLPW The Department of Labor Protection Welfare DOE The Department of Employment DPW The Departrnent of Public Welfare E,AtFI 1 r East Asia ariud raciiic Region: Worlu Baiik uilice, Bnigkok. EASHD East Asia and Pacific Region: Human Development Sector Unit no E,.lly,etSrie GDP Gross Domestic Product GToC...` L GvernrentUof U L' k IailanAdU GTZ German Technical Cooperation NLQPTCD IJUIJAUJ eeop... ....... entVYUk Soci.a! P otLection IrCaln ILO International Labour Organization I" A Japar In terntiafion.a Co-erartnn -A nanr, LFS Lobor Force Survey L LaT Mbo Market rnfLrmation M&E Monitoring and Evaluation MOLSW Minictrv of Labor anrd Social Welfare NCTL The National Congress of Thai Labor NEpSB Th.e Office of the National Economic and Social Developnent Board NGO Non - Government Organization NICr The National Institute for the Improvement of Working Conditions and Environment NSO The National Statistical Office OSH Occupational Safety and Health PHRD Japan Policy and Human Resources Development Fund PPAT Planned Parenthood Association under the Royal Patronage of HRH the Princess Mother SES Socio-Economic Survey SIMPOC Statistical Information and Monitoring Programme on Child Labour Thailand - Country Development Partnership Social Protection SME's Small and Medium Enterprise SSO The Slociai 'ec-uriLy Olllce TA Technical Assistance TOR.l Terr. of Rveference Ul Unemployment Insurance U!S Unemplovn ent Insurance Svstem UNDP United Nations Development Programme IlNICEF United Nations International Children's Emergency Fund Vice President: Mr. Jemal-ud-din- Kassum | Country Director: Mr. Ian C. Porter Sector Director: Mr. Emmanuel Y. Jimenez Task Manager: Mr. Christopher Chmberlin Thailand - Country Development Partnership Pfanial Prntcrtin Acknowledgements .............. III xec-uUive SUImLLry .................. I Chapter 1: Background and Framework for CDP-SP . .1................... A. Introduction .................................................... I B. Social Protection Context in Thailand ...................... . 2 C. Framework for the CDP-SP Program ............ ..................... 8 D. The CDP-SP Program .................................................... 14 Social Assistance .............................. ...................... 15 Employment Service .................................................... 16 Unemployment Insurance ................................................... 19 National Statistics Office .................................................... 22 Occupational Safety and Health .23 E. Risks . .27 F. Outputs .27 G. Development Impact .................................................... 28 Chapter 2: CDP-SP Launch And Progress To Date ..................................... 29 Social Assistance ................................. .................. 29 Employment Services . ................................................... 31 Unemployment Insurance (U) -... . . 33 National Statistical Office (NSO) . . .35 Occunational Safety and Health . ..36 Overall Assessment of Progress and Next Steps . . .38 Thailand - Country Development Partnership gnorial Prnttchnn Annexes I Development Policy Matrix for Social Protection ............................. 39 II Donor Co-Financing Matrix(Fy02) and Partnership Matrix .................. 45 Boxes I Social Risk Management - Diversification of Instruments to Manage Risks. 9 2 Overlapping Missions and Clients in Social Assistance Provision in Thailand ........... ............................... 15 3 International Experience with UI Programs ..................................... 20 4 Issues Facing Employment Services in Developing Countries ....... ........ 32 5 The UI Simulation Model - Some Preliminary Results .......... ............ 34 Figures I The vnlume of cncme trn.siers in re-2tin to tots! lnome, by real per capita income, 1996 - 99 . . 2 - -. .w/ aianA. inpsi,pnop nf cn01is l ncietnni'p nnti social security by real per capita consumption quintiles, 1999 ....... ....... 3 3 taAcur.A--t r.ati of incorr.m by rergin 1022 I !996 rnA 1999.4 A 4 Total Government expenditure and mean household provinces, 2000 ...... 4 to-A, ; T -- 1D.-I. 1 001 - ')nnn tOA 52 J1J in .......I.................................. 5 6 Percent of Terminated Employees Receiving Severance 1997 - 1998 ..... 8 7 ~ V IA V.IIIZ41 X T.1TV n . fA*p'U0a"LJ A ± ..................................... 1 Government Budget for Selected Safety Net Programs, 1999 - 2000 .......4 2 Suw-silary of ]Labor MarI-fket I,ndiCatUors TDA1-Hing Uhre. (Cribsis ................................... 3 CDP-SP: Complementing Informal Coping with Formal Risk Reduction, Mitigation -and Copig ......................................... I.1 4 Performance Ratios, Public Employment Service 1995 - 1998 .............. 17 S Compliance with' OSH Laws ('Dy size of enterprise) ........... 24 6 Proportion of Establishments Inspected in 1999 ............... ............... 25 7 Progress Towards Achievement of CDP-SP Year i Benchmarks: Social Assistance .31 8 Progress Towards Achievement of CDP-SP Year i Benchmarks: Employment Services .32 9 Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Unemployment Insurance .35 10 Progress Towards Achievement of CDP-SP Year 1 Benchmarks: NSO .36 11 Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Occupational Safety and Health .37 ************************ Thailand - Country Development Partnership The Thailand Country Development Partnership for Social Protection (CDP-SP) is a program of capacity building, technical assistance and policy development, fmanced by extemal grant resources, and undertaken on a voluntary, reciprocal, and mutual basis between its principle partner institutions: the Ministry of Labor and Social Welfare, the National Statistical Office and the World Bank. This report presents the overall concept and design of the CDP-SP, a program report on its progress since its launch in July 2001, and the full, updated set of policy and donor coordination matrices that are the core documents guiding implementation of the CDP-SP. CDP-SP was conceived and designed as the impacts of the economic and financial crisis of 1997 eased, and as longer term policy issues re-emerged as pressing priorities. The CDP instrument, meant to support reform and policy development in the absence of financing requirements, seemed appropriate to the social protection sector, and to the many programs administered by the Ministry of Labor and Social Welfare (MOLSW). As the crisis era project and program loans from the World Bank neared completion, the MOLSW sought a means to continue dialogue with the World Bank, but in an environment more suited to grant support. Other donor programs from UNDP, UNICEF, JICA, GTZ, Kenan Institute, AUSAID, and ILO were continuing their support for the development of social protection in Thailand. The MOLSW saw in the CDP-SP an opportunity to improve donor coordination and mobilize additional financial and technical assistance from the World Bank in priority areas of social protection. Several versDectives auided the early discussions of a CDP for social Drotection. The MOLSW saw a need for better use of empirical data to guide program management, to inform policy development and to shape any future crisis response. This pointed to the World Bank as a natural partner for such an exercise, with its longstanding commitment to the use of economic tools and empirical methods in support of nolicv develonment= Tt alsn suggested the inclusion of the National Statistical Office as a full partner in CDP-SP, which was welcomed hy a!!. A secnnd perspective, on the part of both the MOLSW and the World Bank, was the need to improve the agility, responsiveness and impact of crisis response mechanisms in Th.ailand, so that any fiture global shocks could be more readily rm.anaged with more efficient and cost-effective mechanisms. A third perspective was to increase the effectiveness of t2he program in term.5. of targeting and coverage, th.e l in issues that fn.d application in many of the MOLSW's social assistance, social insurance, and labor programs. Given the Worl n-,'. ra.-At.e for -A.-r._ redcton fhe DP ;c-- on jf 151Wh. OR tA iit V -0iR --- A .Jhr 111-M-EC4l tP yiV 101 t- V -l%.V.AA%LS, -.fl t3.A IVAtUO tJiA targeting and expansion of coverage to those less fortunate made a partnership between the 1VLA._2-3 TV aUnd ush VT Bzr bAui& a hiiiiy esauirabl sp. il.e C-SJ P or was preparedu uver IIrI. 1I1U1IUl I adIU LOULLiMIUMU Ul ulV IlUWL.1 VI CDPr-Sr Uon July 30, 2001. Initial activities have focused on five policy areas, including social assistance, empiloymeren services and liaUUI rIULWKeL infUrIIUIUlin, WIueZIl-rp0YlyUIL UiS-ufaULe,X ouccupationa; safety and health and workmen's compensation, and improvement in socioeconomic data and dissemination. Since then, th'e CDP-SP has achieved many of its agreed milestones ahead of schedule, and has evolved to meet emerging policy challenges, in such fields as unemployment insurance and potentially mthe area of pension reform. Technical assistance, training, and policy analysis activities have been mobilized with grant resources from the I Thailand - Country Development Partnership Socinl Prntpttinn Japanese Government (PHRD program) and from the Asia-Europe Meeting Trust Fund (ASEM), both of which are gratefully acknowledged by the CDP-SP partners. The guidance and collaboration of several donors merits special mention, as they have underpinned the early achievements of CDP-SP. The UN family has contributed generously, with the ILO, UNDP and UNICEF playing key roles. JICA, AUSAID, and G(TZ, all important partners of the MOLSW, have provided CDP-SP with crucial input and support in complementary areas. Several NGOs have been important sources of support to the MOLSW, to social protection in Thailand and to CDP-SP, including Solidarity, the Fiederich Eibert Stiftung, and the Kenan Institute. This report on the first year of CDP-SP is the result of a collaborative effort involving many staff of MOLSW and the World Bank, consultants engaged under CDP-SP; and the CDP-SP project unit within MOLSW. To all, we express our appreciation and congratulations. Ian C. Porter Prasopchai Yuvaves (Cointrv Drector, Thnilannd Peranenpnt Rpr.ePtarv The World Bank Ministry of Labor and Social Welfare Sector Director for Human Development East A -a -an DPacif.c D-egio Thailand - Country Development Partnership Social Protection This report is the product of a diverse team from many organizations. From the Ministry of Laohnr and Srcial Welfare (MOLSW), the r.nnr't Was Rnnrvi;QiP hv Mc RlltAeQAsnPP Suebwongpat (Chief of the CDP-SP Project Unit) under the overall direction of Mr. Elawat Chanrdrakr Qert (For%nrmr P rmiinont Secr toru, MAOT 'S'W) Dr. 'TeAo trP WIolintihuna-A (advisor to the CDP-SP Project Unit) played a leading role in developing many CDP-SP c'nnnoncpts natiA optjet Th0 rae-nt hos. hnr.f;.tA ed - +h. cor-n^.u.ts o.A ;... -f m^.-, - F-JfjS -fS ~ Wf b .J . .- *p-J- -14 UJU- - -'.t -LS*fl -1 -fJtfff%,f u -UFl .. . .. A individuals in the MOLSW including Mr. Vanchai Padungsupalai (Director General, DOE), IYJA. TV C&'Llop A IILoyaLUII (Di.-ector General, ,LJ YJ, IVII. IThapabuu .Jai..asvi 'Director General, DLPW), Mr. Somchai Wattana (Secretary General, Social Security Office) and Mr. S3ue 1-LLo-'al (Sce e.e.-Lal, Nat.onal St.aListica41fce ~M 1 -, -- 1.-1 a - r'.. I: _fl.t . - 41.- - TlhWrld Bar'-u tealm WI was ICU by Mri. %ChriLbtopL1C, Chmnulerl Iof'Luie Bar,gkok Office. M1r. Amit Dar, Mr. Sudharshan Canagarajah, and Mr. John Blomquist of the Social Protection lNetwor-k played key roles in thc uraituig of tie report. Other Barik staii contributing to 'ne report included Ms. Pamomrat Tansanguanwong, Ms. Khuankaew Varakornkarn, Ms. Tasanee Chokwatana of the Bangkok OIfice; Ms. Maryam Salim' of the Human Development Sector Unit (EASHD); Mr. Ejaz Ghani, Ms. Benu Bidani, Mr. Kaspar Richter and Mr. Ijaz Nabi (Sector Managei) of the East Asia Poverty Reduction and Economic Management Unit (EASPR); Mr. Robert Holzmann (Social Protection Network), Mr. Indermit Gill (Social Protection Unit, LAC), Mr. Martin Rama (Lead Economist, Development Research Group), and Ms. Pia Markkanen (University of Lowell and ILO) as peer reviewers. Mr. Ian Porter (Country Director for Thailand), Mr. J. Shivakumar (fornner Country Director), Mr. Emmanuel' Jimenez (Sector Director for Human Development in East Asia Pacific); Ms. Maureen Law (former East Asia Human Development Sector Director) and Mr. Homi Kharas (Chief Economist and Sector Director for East Asia Pacific) all provided valuable management support to CDP-SP and to the review and production of the report. Social protection specialists resident in Thailand have provided valuable guidance on many issues in the report, including Mr. Ian Chambers (Regional Director, ILO), Ms. Anne Drouin (Social Security Specialist, ILO), Ms. Elizabeth Morris (Labour Market and Human Resources Policies Specialist, ILO), Mr. Thetis Abrera-Mangahas (Regional Adviser, ILO IPEC), Mr. Gameni Abeysekara (Country Director, UNICEF), Dr. Rolf Suelzer (Director, GTZ) and Mr. Jutta Zinnel (Regional Director, GTZ), Mr. Masaru Morimoto (Resident Representative, JICA) and Mr. Motoyuki Uegaki (Assistance Regional Representative, JICA), and Mr. Phil Robertson (Country Representative, American Center for Intemational Labor Solidarity). Consultants engaged under the CDP-SP program have contributed to the report's content in many sections, including Mr. Alan Abrahart and Dr. Anil Deolalikar on unemployment insurance, Mr. Gary Bodeutsch and Mr. Thammarak Karnpisit on labor market information, Dr. Juree Vichit-Vadakan on social assistance (National Institute of Development Administration), Dr. Kusol Soonthonthada on social assistance (Institute for Population and Social Research, Mahidol University), Dr. Kazutaka Kogi on occupational health and safety, Mr. Gylles Binet and Mr. Roland Longchamps on Workmen's Compensation, Mr. Lars Olnqtn on Imnroving NSO's Data Processing, Warehousing and Dissemination Strategvy nr. Isara Sarntisart on Improvement of Establishment Survey (Faculty of Economics, Chul2linncyl-nm TTnivurvitv0 nnd Mr Peter Dighhv on Review nf the Rnin-F'nrnmirh Suirveyv Thailand - Country Development Partnership So0wul IProutect.o, 1. The Country Development Partnership for Social Protection (CDP-SP) is a collaborative program of policy development and technical assistance between the Ministry of Labor and Social Protection (MOLSW) and the World Bank. It is directed toward better management of social and economic risk. CDP-SP, operates in three key policy areas: labor markets; social insurance; and social assistance and safety nets. It was launched in July 2001 with an exchange of letters between the Permanent Secretary of the MOLSW and the Thailand Country Director of the World Bank, with other partner organizations in attendance and attesting their support (ILO, ILO-IPEC, JICA, GTZ, UNICEF, AUSAID, Kenan Institute). This Program Report reviews the objectives and planning for the three year rolling programn, as it was agreed at the launch in July 2001; and highlights the performance of CDP- SP in Year 1 through June 2002. 2. In Thailand, a series of Country Development Partnerships (CDPs) have been developed as a new mechanism to achieve development objectives, without recourse to World Bank loans. In addition to Social Protection, this instrument is also being applied in two other thematic areas - governance and poverty - both of which have been launched in 2002. All CDPs are based on a development policy matrix, a program of technical assistance and capacity building, and grant financing. Each pursues, in mutual collaborative fashion, a set of policy reforms within their respective thematic areas and sub-areas. The CDPs define a set of distinct policy reform benchmarks that allow both the Government and the World Bank to monitor progress. The CDP's are renewable on an annual basis, if both parties wish to continue. For CDP-SP- the first full year is nearly comnleted; and a second year is under consideration by both the Ministry of Labor and Social Welfare and the World Bank. Given exrellent progress achipved to dAte on relevqnt CrDP-SP henchmarks, prospects for year two are positive. 3. Social Protection Context in Thailand. Thailand is at an exciting juncture in the AoV,olnnn-ont nf itc cnt'.l nrntprtinn nnliui,a .A n-rara. eS1till hsA-,il, n101 -l.h C lora -_, _assX -ks' sw 1~ J*.JS..lh. pS-- - - t-SAit Jfl~S . *....h fl_ ii) .W 54 ,,A ...,. informal and agricultural sector, and blessed with comparatively low unemployment rates, even dsu16 th. cisis , Thai!ifnfd's social p:otection inst1ui.L;ons stilu have timr.e wSo considef options methodically. Yet, there are growing pressures that attend any economy in ualraLLVi.La Jr foAI rUL, ag1r1iUULtur economJyV to aLr uC.-bri1zeU, U.dAUstrialzed onleAS. S'I.juUii.j in income distribution is the highest in East Asia. A formal labor force that is growing in size :_ A . I _ A - _- - -_ A-- -- A A A P A_+ iA _ AA X C-AA M l _AAA+ _ZI lb bu iv LUr, u vI uaianvuL a mIiaGluaInIIL uviamu y i iauuvi i-iaLlIVU. 0G6IIUIGI ilal society still live in or fall into severe poverty, with little hope of assistance from the Thai state. Socia:i rfu[Urme ar[ speaking uout on ublf41 VI luh p-uf ufl th wC[1l5, puLLu1ing pressure on social institutions to reach and help those on the margins. Thai society strongly supports community and family accounta'bility for management of housenold risks, and is justifiably cautious about a rapid expansion of the state's role in social protection. These powerful, and sometimes conflicting social forces, converge in the area of social protection, and help create a dynamic and unpredictable setting for CDP-SP. 4. While there is no obvious social protection blueprint to guide Thailand through the demanding times ahead, the Government is keen to develop a more balanced sociai protection strategy which places adequate emphasis on public and market mechanisms to complement family and community based coping strategies. CDP-SP comes at an opportune time in this process. It has been launched to help the MOLSW - which presides over most of the social protection endeavors in Thailand - and the Thai Government to consider diversification of its Thailand - Country Development Partnership Socia! Prntection social protection instruments, with benefit of sound empirical analysis, a performance orientation, a risk management perspective, and the benefit of the mistakes and successes of other countries undergoing similar transitions. 5. CDP-SP obiectives. Three deficiencies common to many social protection programs operated by MOLSW have been identified: the equity gap that refers to the potential for improved provision of adequate benefits and services to the poor and vulnerable; the coverage gap that refers to those that remain beyond the reach of MOLSW programs; and the efficiencv gap, which refers to the substantial potential to re-allocate resources in a more cost effective manner. The objectives of the.CDP-SP are to stimulate policy change to address these gans. 6. (SrtCritp forin rog.ram selection The desipn of CDP-SP has emphasized selectivity in the choice areas for policy reform and capacity building support. The main selection criteria Lf%r vindertitnkrini.ir ncitnncrp act-tivities are* that thpve ae: +. -A I--- eL.+U_~ ,1,,,ao :&eider,tiflied by h oe=.n sp:o;t p:to.!an oiyaeswf reform agenda in the social protection sector; will hiave Wa uIIIpA Ull Uon uIIVeiveIy of Ioe sleVILcs, lnu * complement the expertise and ongoing work programs of other partners/donors. 7. CDP-SP reform areas. After an iterative process of dialogue and assessment, five substantive areas of social protection reform were selected for development within CDP-SP: social assistance and transfers; employment services and labor market information; unemployment insurance; occupational safety and health and workmen's compensation; and improvement in socioeconomic data and dissemination. Discussions are currently underway as to the possibility of expanding CDP-SP to include parts of the Government pension reform program. 8. Other social protection areas are not included in CDP-SP, such as labor standards and regulation, minimum wage policies, and public employment schemes. For some of these areas, the reform window is not yet open (e.g. public employment schemes); while in others, partner agencies are deeply engaged with adequate resources (e.g. child labor with ILO-IPEC and UNICEF). However, the flexible nature of the CDP instrument does not preclude activities in these and other areas in the future. 9. Furthermore, CDP-SP is working collaboratively with the other CDP programs - particularly the CDP on poverty (CDP-P) - to help the Thai Government achieve their broader social protection agenda. For example, CDP-P and CDP-SP are working together to assist in the improvement of socio-economic survey instruments and data quality, as well as in a systematic assessment of social risk and vulnerability. 10. Financing of CDP-SP. The core program is financed by three sources: grant aid mobilized by the World Bank. counterpart contributions in kind by the MOLSW, and direct budget allocations by the World Bank. Grant resources for the preparation period and first ver of imnlementation total 5680_000= Partner organizations sunnort comnlementarv activities in a wide range of social protection areas, with a first year estimated budget of over I2 million .. ...........~~~~~~~~~~~~~~~~i Thailand - Country Development Partnership Social Protection 11. Evaluation Mechanisms. There are two main type of evaluation mechanisms for CDP-SP - implementation benchmarks and evaluation of pilot programs. The success of CDP-SP is annually judged against pre-defmed implementation benchmarks. These are a mix of policy, legislative and program-level reforms. Secondly, program-level reforms being proposed in many of the areas will be piloted, and the pilots will be evaluated using rigorous impact evaluation techniques. This will ensure that only programs that are shown to be cost- effective and equitable will be implemented on a larger scale. 12. Achievements to date. The achievements to date within the five reform areas are summarized below. A summary matrix of benchmark progress during year one of CDP-SP appears at the end of the section, and Chapter 2 presents progress in more depth. Social Assistance. 13. Under the Government restructuring plans, DPW is expected to become part of a new ministry dealing with social welfare issues by October 2002. The timing of CDP-SP assistance corresponds well with this imoending reorganization and has presented CDP-SP an opportunity to contribute to this crucial process. To this end, CDP-SP has assisted DPW in: neThveloping staff and prOGesS guidelines through a study on management and administrative reforms of DPW and social assistance programs; Developing guidelines aAd manuals on us;ng monitoring indicators throu .+- a s.ny on program coverage for selected groups and developing a set of indicators; *L Lancing a social -:isk an--------t sesmet oea-.n u. hratrs.so L,4Ui1'.41m~ a iJL, r. LU~N~LU V UUIUI aUiiity aabrbbIILVIL IAV VAaUIIIILIJ LLI tl. ,UdJCWH4I ILICS UL vulnerable groups and identifying gaps in program coverage and adequacy targeted to 'uiese grOUpS; * Organizing seminars on the methodology of risk and vulnerability assessments. Emplovment Services. 14. In the first phase, CDP-SP has focused on the development of a labor market information (LMI) system and upgrading the analytical capacity to understand labor market dynamics in Thailand, and also to provide DOE with good practice international experience on the design and implementation of employment services. CDP-SP assistance to DOE has focused on: * Assisting LMI unit in preparing a set of LMI quarterly reports highlighting labor market trends; * Developing LMI unit capacity to conduct labor market analysis and prepare reports through training seminars and workshops; * Assisting in the determination of appropriate administrative arrangements for the LMI office through a background study and related workshops; * Preparation of a background note on international good practice and experience with the management. design and evaluation of emnlovment services. U1ne.mnInvment !nvuranre fTI!) 15. In response toannr!gent timetnhle of 1TT development and implementntion, MOLSW requested CDP-SP to enter into the UI preparation process, provide analytical support, and heIn thp Minktrv t^ct vnrinlic nananitipq snhl taeiinmntinne The workc fn TIT has intencsfi6eA with the following achievements: Thailand - Country Development Partnership Social Protection * UlI unit established in MOLSW to coordinate UI planning and implementation with SSO and MOLSW departments; * Simulation results help MOLSW to rethink timing of Ul introduction; * Excel based tool kit introduced and MOLSW staff trained in its use and application to design issues; * Rayong provincial pilot planning underway to test administrative capacities; * Background papers on international experience and on policy questions and choices prepared; * Eight workshons and seminars held on policv constraints. issues and ontions for UTI. Occunatinnal Health and Safetv (O.SH) 16. CDP-SP assistance has been target.ed towards enhancing eff.cien.y and covetrage in the management and delivery of OSH and the workmen's compensation scheme. Areas of assistnnc have focuendi on: * Assisting DLPW develop proposals on OSH management reform through a review ar.d wo.kshop on +-he mar.agement ar.dI inst.+".^;-n str.-e- of OSH;. Wm vfl"nnnJj UJAL%i, fllWi6,iifll -P innostitutio. sJ u..LfL ~U Z JbJI. * Assisting SSO develop recommendations for enhancing the effectiveness of the, workmenr's compnRsatilon schem,e through a review of thse coverage nUrd efficiency of the scheme. Data for Social Protection 17. CDP-SP assistance in this area is aimed at assisting the National Statistical Office (NSO) in improving tne quality and relevance and access of labor and social statistics for more informed analysis and policymaking. Ongoing assistance has been provided to: * Enhance and implement revised survey instrument for the socio-economic surveys (SES); * Assist NSO to propose a new data warehousing and dissemination strategy through a study and small pilot exercise; * Enhance the quality of establishment surveys through assistance on improving survey methodology and sampling framework. 18. Benchmark Progress Matrix. The progress towards achievement of Year 1 benchmarks is impressive and ahead of schedule in some respects (see table below). Progress Towards AKtainmeul of Benchmarks Benchmark | Progress To Date CDP-SP Capacity Building Related 1 I | ~~~~~~~to Benchmark SocialAssistance. . brw develops bwacimcs on drari BencmariK acMCveU - tuay on coverage of sociai assistance indicators and manuals for programs and developing a set of monitoring cash transfer programs monitorable indicators DPW develops guidelines for roles Benchmark to be achieved in - Study on management and administrative and responsibilities for new ministry Year 2 reform of DPW and social assistance WOrisap on efficiency and Benchmark achieved - .Suuy ou mgt. uad ad mn. ReUfrm uo coverage issues with cash-transfer DPW. programs - Study on social assistance programs I Workshops on management, coverage and -cost-effectiveness issues Wo,U-hops~ on "Cha1Ipnos of Ien^ MmaI -^iee UJn.-hpon~ n,, ^-hoo goo n,nA.~-^t, Decentralizing Social Assistance on cash transfer programs Intemational Experience with Cash- [- MOLSW participation in World Bank iv Thailand - Country Development Partnership Social Protection Benchmark | Progress To Date CDP-SP Capacity Building Related ] ____________________ If Xt flULUIIUP. Transfer Programs" | tralnin courseonsocial assistance Employment Services... . MOLSW decides on location of Benchmark achieved - Study on administraive structure of LMI focal point for analysis D to c n:_ _ office L.AW)U 4 fl ~U1W 11L IC - '_UI1UWWUL UcuU W pIUvIUC I n Lu WVIL assist in preparing LMI report j ____.._______` ____ analysis and report preparation Staff of DOE trained in area of labor IBenchmark achieved - Training for LMI staff undertaken by Imarket analysis I consultaAnt (ongoing) LMI office produces one policy- Benchmark achieved - I" set - TA on LMI analysis and report £L*1flL *IJtIf Vt M *5.H&V-,v M-A.4OOJ Seminar on International Experience Benchmark achieved - Study and workshop on Intemational good on Job Placement Design and practice on employment services Implementation J - MOLSW participation in World Bank lj,employmentl,uw,we.. [__________ _ training course on labor markets Fornation of Ul unit Benchmark achieved. - Ongoing TA on intemational experience I I -with Ul schemes; drafting policy note Identification of priority issues for Benchmark achieved -Priority issues study on Ul design and design and implementation of Ul implementation 4v4tem _ Wnurchnn nn I TI eliP"/irnlp,me.,tnt Ul simulation model developed and Benchmark achieved (This is - Ul simulation model prepared disseminated a Year 2 benchmark) - Training workshops on model I dissemination Design of pilot on implementation Benchmark being achieved I - Ongoing TA on design, implementation of Ul scheme I {This is a Year 2 benchmkar) I and evaluatian of nilot | Workshop on Policy Issues on | Benchmark achieved - Workshops/presentation on UI design and 1 Implementation of UI system | implementation issues OIccupational Sarety and Health... . DLPW submits proposal on OSH Benchmark achieved j - OSH Management review focusing on I management reform to MOLSW I I mandates, financing, program s and outnuts - Review existing OSH institutional |____________________________ | _________.________ I___ arrangements and proposing refom s iOT ratifies ILO conventions on Benchmark achievea - information dussemination on intemationai worst forms of child labor (No. j good practice 182). l l l OSH indicators proposed by DLPW Benchmark achievement | - Study to be launched in Year 2 Idelayed to Year 2. _ o Wy UI.HUUp U1l 1IUjIUV U1g 13 11U41l 4LU (VIu no A I - 1 V MW LiUWJUl I w , L11upUbaUUu I Effectiveness of WCF: Institutional a Year 2 benchmark) scheme l I and Incentive Issues I _ - Workshop on Efficiency of WCF Data for Social Protection... . _ NSO improves design of socio- Benchmark achieved | Study on improvements of SES NSO improves design of I Study launched. Benchmark j - Study on improvements in establishment establishment survey. [will be achieved in Year 2 survey NSO proposes new data Benchmark achieved (This is - Study on data warehousing and mining warehousing and dissemination a Year 2 benchmark) - Workshop on data dissemination, en9fn¶ nas,,flmlfhId.fl fl Oi m.ainn 19. Fu.fure nfCDrP-SP A fnwrm4l VYer 1 rvaxiew v lonrshop wi*h releoant ct-ehnlq.,Q ;s A -. - -1 .. -- Y - -_1, -.1h e-. M Lt f.LfJlC scheduled to be held in September to present the progress on various planned activities for +t first year of fl, .-e.r-h-l - f- -cusng on .-.n,nrks and m.on..akla targets have been achieved and the.effectiveness of capacity building as well as the future scope of reffo....1 effort-s. Based on +the oucm f ths o.ksop the Av.oll- Ba. k-I a--A +1. ,jiitjnii tist t. JPO%U.~A VIA Llj~ s,uL%s,.uI, l WIOUt "VYuitOtLAWJ, ULt.V WV 'JRU LJa&LU'. CLAM U1VI Thai Government will make any necessary adjustments to the proposed year two of CDP-SP actALvitIes aUnd reforms, ad the framLework ad development policy Matlix for Year 2 will be accordingly revised. v Thailand - Country Development Partnership Social Protection 20. The formal launch of Year 2 of CDP-SP is anticipated to take place in October/November 2002. Year 2 will involve consolidation of reform into the key steps necessary to improve service performance, the application of technical and analytical insights gained in Year 1, and the preparation of plans for implementing on a larger scale the service improvements that have been agreed. 2i. rt nerm-re, given tne wide-ranging tecnnicai assisiance Demg provideu througn CDP-SP, the preparation of a number of products for dissemination highlighting. the policy relevance of CDP-SP wiii be undertaken in Year 2. Tnese inciude riagship Publications, Policy Notes, and Technical Papers. Flagship publications will present outcomes and implications of overarching products and refiect the inter-related nature of the CDP-SPI components. Policy notes will highlight key findings, policy recommendations and proposed implementation initiatives in the respective areas. Technical papers will present in-depth analysis of select reform issues. It is also anticipated that lessons of CDP-SP will be disseminated through a program of international workshops and seminars. These workshops will also expose Thai policy makers to the experiences of other countries undertaking social protection reforms. vi Thailand - Country Development Partnership A. Introduction 1. Poverty reduction and income generation has been recognized by the Thai Government as a high priority area in the Ninth Nationral Economic and Social Development Plan. A mainstay of the Ninth Plan is pro-poor growth, that is, growth of economic sectors that the poor typically rely on and growth that provides employment opportunities and generates income for the poor. Among the goals expressed in the Plan, Thailand will seek to reduce poverty incidence to less than 12 percent of the population by 2006 and provide equitable access to education and social services to the poor and disadvantaged. The Plan also envisages Government support to the empowerment of Thai people, and especially the poor and vulnerable. The goals of the ninth plan echo the pro-poor policies of the newly elected Government. 2. This more pro-active approach to poverty reduction has undoubtedly been influenced by the economic and social consequences of the recent crisis. Prior to the crisis, Thailand had relied primarily on economic growth to alleviate poverty. Spurred by rapid growth, Thailand's poverty incidence fell from over 30 percent in the late 1980's to just 11.4 percent by 1996. Under such circumstances. formal social nrotection mechanisms were given a somewhat lower priority. The crisis impacts, however, showed that the regular progress of the past could be quddenlv reversed and that poorer Thai families mav hear the brunt of economic enntractinn The crisis thus stimulated a re-examination of the social protection system. 3. Thai society places high value on strong community and family ties, and this has crnntribhte,d tn a strnna infnrmal enafepty net Tn the fnrnrmal ctor, there upwer fpew APdPvnrlpA formal instruments available to help individuals mitigate and cope with the risks exacerbated by the crisis such as u.-employmer.t a.nd pove-., Worsening .om.icnditinsn led to a awareness that informal household coping was not sufficient in the face of large covariate shocks. Desp.-te z.- zdriAb-..blic polic res,ponse in the wake ofP the crissis (timeu,,l budget OLAWiJMO. tJVOJJAL. A - U1 * Ul. jJtU,Aw. FIJi-J I 11 u1l YfA ttf~t* 00tLlt1 bUUtg support for health and education expenditures and a large job creation program launched in 1999 1, ^-,ong othllers), weaJknesses ir 01C sociMal poeto yt,,bcr, nraugyeiet I 777~UU1'J1~ SJ1~10J ~ UtU1~ 3J.a J1Utt.LU1%&I ajaLI~11i uaIF,IV, U1L1i.a31LI%1y VVIUV,1iL, including coverage, equity, adequacy of benefits, cost-effectiveness and intervention timeliness. UI adUILIU.II, sveraI iongULUItUirUg IonerpU reiainUg to 1abUo IIlaLKVIL poUIcLie, sociai Uinuia cr., and social assistance programs came to the fore. 4. The adverse impacts have led Thailand to undertake an internally-driven process of assessing and planning the reform of the sociai protection system io heip individuais and communities better manage risks. The Government wants to develop a more balanced strategy which places adequate emphasis on public and market mechanisms to compiement family and community based coping strategies. CDP-SP comes at an opportune time in this process. Despite better outlook of the economic forecast, CDP-SP can still serve as safety net at the time when uncertainty usually prevails. In addition, the program provides an important avenue through which the World Bank and other donors can help the Thiai Government meet the goals of the Ninth Plan and improve the effectiveness of the social protection system in a number of areas. Thailand - Country Development Partnership B. Social Protection Context in Thailand 5. An important form of assistance for the majority of the population has been and continues to be through informal assistance mechanisms. Bank estimates sugest that for some years prior to the crisis the share of average household income from transfers was fairly constant at hetween 5 and 7 percent. While there is evidence that the share of transfers in household income increased during the crisis (Figure 1),l especially for the poorest groups, these transfers were not ciifficient by thernqelves to fillv alleviate hnrdshin and nnvertv REtwe'een 1996 andi 1999, the share of the poor in the population rose from 11.4 percent (6.8 million individuals) to close to 16 perce.nt (9.8 mil!ion inrdividuals) 2 Aiditionally, households that were alrready poor prior to the crisis saw their incomes fall even further. Furthermore, labor market deimand fell sharply led-iAn to a sho,.,- risen -.nenmploymnt and .4rnn in rwal IJ. T--6 w k- -- l A--_ rlk- [s_-sVel--_ ---v A-A +- ''U-- 6. LIn U1.e scaV,tl dominII, LLhe% Gvljlllerl reIL de toFIXV the Ll isi Vllal, il bAIAU y Uinc1,VaUrein budget support for existing programs in health and education, dramatically expanding job creaLion ulUUugh civil Works fir,&rcir.g, I, eA.nUUin SCvCia1ii% p43ay bUeneILs LV IV IIIUUUIn, extending formal sector social insurance to those who had lost their jobs, expanding the scope _l L___C=_ ^_1_ __ 1 __ _z____ ZL_ _I A_- _ L z___ A _- - _ 1-- -=___ tUIU Ur;IItzIL UIIUVI bual l d tib1Ull LU L1Iv U1UIvIIL, tIu UUIVI UhtlI4LiVVb. Pl ittUJul r.111uet Was reliance on the informal safety Figure 1:The volume of Income transfers in relation to total inco net, anid tuhle provision of I by .-apereapitaincom equirl..e,:99'919 catalytic support to community 12] 11.7 and family based coping and II] mitigation mechanisms. These l0 98 01996 *1998 01999 interventions, particularly the 8 89 job creation program and 1. 9 vL 8.3 7 support to the informal safety a. ____ net, have played an important la 71 I 0 1 l ll role in mitigating adverse 6- impacts of the crisis in the 5 46__ short-term.IIlI_I_I Poor_t Second Third Fourth Richet 7. Now, over four years Real per capita irome qinnile after the onset of the crisis, Thai and donor funded analysis has highlighted some shortcomings with both the crisis response and the underlying program designs. These include: i) some responses were not timely; ii) instruments with automatic stabilization properties did not function effectively (e.g., severance pay); iii) while some interventions were progressively targeted (job creation scheme, for example), coverage, targeting, cost-effectiveness and benefit adequacy was low in others (social assistance, job search assistance schemes); and iv) available data was not analyzed effectively to inform policy. 8. The three main elements of Thailand's formal social protection strategy are social assistance, labor market policies and social insurance. An overview of these areas including recent reforms undertaken after the crisis are briefly summarized below. ' Source: Thailand Social Monitor VI, 2001. 2 According to estimates, poverty would have risen by a fiurther six percentage points without these transfers (Thailand Social Monitor VI, 2001). 2 Thailand - Country Development Partnership Social Protection Social Safety Nets 9. Poverty and vulnerability continue to be a concern in Thailand. It has been suggested that "the crisis led not just to higher poverty, but also to greater vulnerability of the Thai population:" (Bidani and Richter, 2001). Bidani and Richter find that vulnerability - defined.as the likelihood of being poor in the future - increased between 1996 and 1998 and remained high in 1999. Further, the overlap between the groups of poor and vulnerable has increased since the crisis. 10. Thailand has a number of social safety net programs that aim to address poverty and vulnerability. Thailand's public social safety net programs fall into three main categories: i) cash transfers, including a family allowance and a social pension allowance to supplement the pensions of the elderly poor; ii) in-kind transfers, including subsidized medical services, housing programs, a school lunch program, and various social services; and iii) income generation programs, including job creation schemes and public works projects. 11. The direct cash transfer programs include cash assistance to poor families and a monthly per diem given to the elderly and the disabled without sufficient means of support. The main in- kind transfer program targeted to the poor is the Low Income Health scheme. The program entitles families to receive a package of health services at public facilities at low cost. About 20 percent of the population was covered , by the scheme in 1998. A new F2:CatrageamdicideofwcaubSeaisocialstcwty program is being introduced gradually Ir - I---r -p_xco W3q-_i e, 1999 that will eventually provide minimum * ' = . U. - UQ q.i M-9- health coverage for all Thais, called 50I I the "30 baht universal health coverage 40 39 36 scheme." The program entitles people l 30 I to medical care at a public facility for Ar1 211 30 baht per visit and has already been 13 rl ..IrI implemented across all the provinces J0 >, * [II 3 l Ii I inthecountry. I -m . m - . U .U , 12. While many of the social h 'mf d r 1 9xii^~~~~~~~~SMAMUENrftE1rb soeb9ait l= safety net programs appear to be somewhat well-targeted, coverage rates are low. For example, the left panel of Figure 2 displays the coverage and benefit incidence of the social assistance nrogram for the noor elderly. The nrogram is reasonably progressive, with nearly 40 percent of the beneficiaries coming from the poorest quintile and only 5 nercent from the top quintile The main prohiem is that of low coverage- with only 13 percent of the elderly in the poorest quintile receiving benefits. Furthermore, there have been questinnsz raised abhnt the ront-tefffertivenePq of these nrornqm 13. Budget allocations for keyratysocial safety net programs for the most vul.nerable were maintained or increased following the crisis. Table I shows Government budget allocations for selected safe+t net nprograms for 1n999..nni The T Lowi Tnoran T-TtoIth A o,,,o m-torns1 and child health, school lunch program and teacher training and materials were all protected from b.uAget c.T.h 11,0 ya erf.h0asi on C..+ tra;nn6 n. lao-r= nte-Aive proe+ct +1,n+ According to one of the measures used to measure vulnerability, the proportion of vuinerabie among the poor increased from 87 percent to 95 percent between 1996 and 1999, while the proportion of poor among the vulnerable in.cre-ed ffiron 23 percer.t to 40 percer.t dtning the t.e A 3 Thailand - Country Development Partnership Soninl Prntecrton characterized safety nets expenditures in the immediate post crisis period were reduced in 2000, with a slight increase over previous years for in-kind and cash transfers. Table 1: Government Budget for Selected Safety Net Programs, 1999-2000 (In mllions of baWL 1999/00 2000/01 Income generation 20,587.2 11,771.7 In-kind transfers 12,538.1 14,942.6 Low income health card 9,820.8 11,246.2 School lunch programs 2,364.6 2,546.4 Housing 352.7 1,150.0 Cash transfers 1,687.7 2,338.7 Total 34,813.0 29,053.0 Percent of GDP 0.74 0.62 Source: Bureau of the Budget, Thailand. 14. A notable feature of the, assistance programs is the continued Figure 3: Headeountrtioof ieome. heavy reliance on income-generation 504by region, 19481996 and 19 schemes. Income generation program 45 9 accounted for nearly 40 percent of the 40- U 996 0199 budget allocated for safety net 3-1 32 measures in 2000-2001. Employment 30 generation is addressed briefly in the * section on labor markets and is 20 therefore not repeated here. I :l k I i L. 1. 6 15. A striking feature of poverty in | 5l Thailand is the variation between ol I, I, 01 _I E o I geographical regions. The Northeast I NwUlan SoWh North Cno B-guS has by far the highest incidence of poverty. The crisis further increased this regional disparity. with the Northeast experiencing the largest increase in poverty incidence of any region between I 1 1996 and 1999, to 31 percent from 19 Figure 4: Total govemmentexpenditurt and nhouIhold percent in 1996 (Figure 3).4 18.10 1 |_ |I| 16. While there are significant I s .500o] . I differences in novertv levels acrnss | f 12,0DO0|0| regions, the distribution of Government expenditiureq nn Anti-nnvPrfv n 1ornmc ___*__*_-__*__*_. regrressive. Fg -e4 indicatebs that varies by province,r ~and is mildly 6, wealthier provinces receive a slightly 20,003000040000 0 70.0 90 expenditures than poorer provinces. R.! .-n i ,uodnn o p .eo la iua ULIJ.14 LULuLUUr, UV-3UU InOtIi imply fundamental inequalities between 4 Source: Thailand Social Monitor VI, 2001. 5Source: Thailand Social Monitor VI, 2001. 4 Thailand - Country Development Partnership Rnrial Prntertion provinces, it does suggest the desirability of examining more closely the expenditure patterns at the province level, particularly since poverty is most pronounced in the Northeast region. 17. Issues of financing become even more critical with a major policy initiative underway with respect to the administration of social assistance in Thailand. The new constitution stipulates that administrative responsibility for programs will be gradually transferred to the provincial and local (Tambon) Government levels. Together with devolution of administration, there is increasing emphasis placed on maintaining and strengthening the participation of civil society and the private sector in the provision of social assistance. For example, the Ministry of Labor and Social Welfare has established 42 provincial NGO Coordinating Centers which coordinate activities of NGOs working on social welfare and safety nets in each province. DPW also annually allocates grant funds to NGO's working on social assistance and social welfare activities. 18. There are several issues surrounding the culrrent nrograms= Amnonr there are: i) a concern over the coverage, adequacy of benefits, and efficiency of administrative operations of many existina cnninl assistane prrams ii) the flnw nf finnnninl rpesurces frnm thp c.entral tn thp regional and local levels and the criteria used to disburse these funds; iii) the adequacy of adm.nistrxative c-araci.ty at local levels; nd niv the imnlPmon.tntinn det21cs nccnriatp.d with devolution, including the responsibilities, allocation of resources, and accountability vis a vis the cenr.al rGover.menrt and lloc-al authonities. CtnDP=SP is oa tna in f1,. ror,Aa,,, of t+.e curr.t social assistance programs and their future role in targeted poverty reduction and will help refine rcn...-.nAo+.. ;-ri -.,oFont *W9VIIIJ I lkl gAg CAIAJ U V- sI-5V ig-U1 611. 19. lIn thIe 15) years prioi LtUoLV l.cisis, T.hailarw.dIuJuY'U uILU.ICL1e,d rIOWUI, wiut ajuiual GID growth rates averaging close to 7 percent. A key element of this success was the country's openness to triadle and CUMpULILIUon - export growth was over 20 perce1L itll 9OV80-96 IU lnInt capital inflows grew more than 9 percent in the mid 1990s. These growth rates impacted the labor market. Real wage growth between i 990- 997 exceeded 25 percentE ana the structure of - l employment changed significantly rigureS a.Crowth in insured People i99i-2000(ON) ma-inustry ana services accountea for about 50 percent of a labor I orce or about .35 miiiion in i996 w* A | as compared to 30 percent in ________________________________I / 9i9. Furthermore, relatively flexible labor laws and regulations ze w _/ < \ _ ensured that employment grew at i.j VW /nn nq. ISfl 16W IS? ~ ,f in. , a rapid pace. .. _ V - ] 20. The onset of the crisis in ...~ wL jmid 1997, however, changed this Year picture - GDP fell sharply in 1998 l I by 10 percent and only began recovering slowly in the second half of 1999 (GDP increased by 4 percent in 2000). The labor market responded through both price and quantity adjustments - in the first year of the crisis, 6 Evidence indicates that the competitiveness of Thai industries in the manufacturing sector had begun to erode during this period as productivity increases were outstripped by wage growth. 5 Thailand - Country Development Partnership Social Protection overall employment fell by close to 3 percent, unemployment rates shot up from 2 percent to over 5 percent and real wage rates fell by over 7 percent. After rising every year in the 1990s, the number of insured individuals in enterprises over 10 workers fell by close to 11 percent in 1998, mainly as a result of significant retrenchments in the formal sector (Figure 5).' On the supply side - labor force participation rates fell by about 1.3 percent - suggesting an increase in the number of working age individuals who became discouraged and stopped looking :for work (Table 2). Informal employment (proxied by self-employed and unpaid family workers) rose during the crisis - while 50.7 percent of workers were in this sector in 1996, this proportion increased to 54 percent by 1999.8 The crisis also had an adverse impact on vulnerable groups, including the elderly and youth.910 Table 2: Summary of Labor Market Indicators During the Crisis Indicator % Change (1996-98) Employment -2.8 Unemployment ~~~136.4 |Real wages |-6.2 Labor Force Participation | -1.3 Source: Betcherman and Islam (2001) 21. The Thai Government, with assistance from donors, responded to the adverse labor market impacts of the crisis mainly through ramping-up existing labor market interventions (employment services, skills training and job creation) along with a few policy changes. This response was dictated in part because of the urgent need for assistance. Skills training programs were expanded, targeting skill upgrading of over 100,000 people over three years. The employment services launched several new initiatives aimed at enhancing the effectiveness of intermediation services. Public works schemes launched by the Government provided temporary employment to over 800,000 people and various donor funded initiatives targeted another 11 million person-month of jobs - these programs were relatively well-targeted towards the poor, with 64 percent of the beneficiaries being drawn from the poorest two quintiles. However, this approach to job creation emphasized one-off increases in budget for existing and some new civil works programs, based in many ministries, and without a clear link to employment services or to a single implementation unit that could impose consistency of benefit criteria and optimal regional targeting. 22. While extensive rieorous evaluations of these programs are not available, recent studies have highlighted some major issues/areas that will need to be reformed in the area of labor policy and interventions in order to facilitate a well-functioning labor market inc-luding: (i) developing better qualitative and quantitative indicators of labor market trends and program nprnrrmnnan.ce arnd feeding thee hbar-L intn nnliev rnakinag (ii) elpsigrnn aponprinatea regu!ation (e.g. severance, job security) and standards (e.g. workplace health and safety) which benefit 7Source: Social Security Office (SSO) data. 8 A growing body of international literature from developing countries suggests that not all informal employment may necessarily be involuntary - the self-employed may be voluntarily choosing to be in the informal sector, while informal wage and salary workers are more likeiy to be there involuntarily. I hai data do not permit a test of this hypothesis. Thailand ha msid manir strfdes in rpdewino chid ! bor; ln,tia.inntin .e in thI IL!A W.g roup have dned.l; A from 35 percent to 15 percent between 1970-1997. While there was a slight increase in labor force participation during the crisis, Thailand is currently developing several programs to address this issue and has recently ratified the ILO convention No. 182 on the most harmful forms of child labor. '° The economic situation has stabilized since the crisis. Unemployment rates have fallen to just over four percent by May 2001. Employment has increased - from 28.4 million in May i998 to 30.66 miiiion in May 200i. 6 Thailand - Country Development Partnership Social Pr te ti- workers while ensuring that excessive costs are not imposed on employers; (iii) improving design, management and cost-effectiveness of labor programs (e.g. employment services and job creation) to ensure greater cost-effectiveness; and (iv) designing appropriate income support measures to mitigate the risk of unemployment (this is discussed in the next section). 23. The crisis experience has suggested important lessons for Thai policymakers. During the era of rapid growth, new labor policies and programs were implemented slowly and were given low policy priority. When the crisis hit, Thailand did not have adequate programs in place to help workers deal with its adverse impacts. The Thai Government is. therefore. keen to develon policy instruments to better manage labor market risks. CDP-SP is providing support in many of the areas identified above. Sorianl fneurance 24 Thli nrp-rrivic social inmirnnrp evsytm wan nhbrnnttPri7Pz by limitti'i nnvPrnate, hnth in terms of the proportion of the population covered and the average benefits provided. The systerm ;n.-incIIup nrnogar.s dAe,i-nedA tno hel1p mitigotA the ,4siQ off sicl-nAccn anti tiasailit , b. formal sector workers, such as a workmen's compensation fund, health insurance, disability and 4ah * enefits, a-.d fsate.ity bernef.ts TI.r vWeree pension pl!ans fr npublic stor workerss arnA several private sector provident funds for old-age security. 25. Most existing social insurance programs benefit workers in the middle and upper income cat;V,ruIL;V. 1113a 1 LU Ut VAjJt.t.LVU av UlItv3 IJ1Jv1aOt1i ait %.ULLLIIUULUI3 allU aUiV IlUL UdesiIgU as poverty alleviation programs. However, to be effective risk mitigation instruments, they should strive to cover a significanlt proportion of tUhe eligible population. Evidence in lTailand suggests that coverage has been quite low. The rightrnost panels in Figure 2 show that 64 percent of the OeneIiciaries 01 ui* socia; security scIheme belong IR L wO cWnu-uinputon quinui;es, yet less than a third of the eligible population in these quintiles receives benefits (coverage is significantly lower among the poor).11 26. Several major reforms of the social insurance system began in late 1998. Tnese included the introduction of an old-age pension scheme separate from the provident funds, as well as a child allowance system. Tne new pension system applies to all private sector workers in firms with 10 or more employees, covering an estimated 5.7 million workers. It is intended to complement existing retirement savings schemes, including employer-sponsored provident funds and limited proprietary plans for the private sector and a defined-benefit Govermnent pension plan for the public sector. Questions have been raised as to the financial sustainability of the system, and the Ministry of Finance engaged ADB-fmanced consultants to study the pension system and recommend needed changes to contribution and benefit regulations. The study suggested that under reasonable scenarios of population demographics, current regulations imply that the pension fund will be exhausted between 2040 and 2050. These findings echo those of earlier reviews by the IME and the World Bank (Heller, 1998; and Holzmann, 1998) and are currently under review by the Government with continuing support from the ADB. It is possible that the Govermment may ask the World Bank for some assistance in this area through CDP-SP in the near future. 27. Currently, support for unemployed workers is intended to be provided through severance payments. Prior to the crisis, employers were required to pay workers who were laid off with at Source: Thailand Social Monitor VI, 2001. 7 Thailand - Country Development Partnership Social Protection least 3 years of service a lump-sum severance equal to 6 months wages. After August 1998, severance pay was increased to 10 months of wages for employees with more than 10 years of service. 28. The coverage and compliance with the severance payment scheme has been poor. It is estimated that less than 15 percent of all private sector wage employees regarded themselves as covered by the scheme in the third quarter of 1999, according to the Labor Force Survey. Between July 1997 and July 1998, for example, over 90 percent of terminated workers in firms with less than 10 employees received no severance pay (Figure 6).12 Both emp'loyer and employee organizations are unsatisfied with the current severance scheme - workers because they perceive the coverage to be too low and employers because they perceive the compensation as too generous. 29. Absent from Thailand's social 1997199S insurance programs is a formal lo,_DRnp unemployment benefit scheme. A major i 7 Recxvadd1-3 nmnufP If policy initiative that is being debated by I So'02 1i=*-Wr the Government is the appropriateness and timing for the introduction of an I 6 r unemployment insurance scheme in 40 Thailand. The main objective of the UT .1 , I scheme is to help mitigate the risks of 16 cyclical (as opposed to structural) ,o -o unemployment. Planning for the scheme l.9 IB . mo ,E_ has been evolving since the Social __ ________sob Security Act mandated its creation in the earlv 1 990s However while earlier GTovemments did not nlace high nrinritv nn thic in;t;at;ivP this issue has been an important element of the current Government's campaign platform. CDP- SP s helininw the Government review th.e appropriatPness, timing and desigrn arrangemenrt for such a program. C. Framework for the CDP-SP Program 30. The foregoing review has briefly highlighted some of the elements of Thailand's social protection strategy. As tile country moves to diversiry its sociai protection portfolio, there are several key overarching challenges common to many public programs. These include largeting, coverage, efficiency, benefit adequacy, and management/administrative capacity. 31. Government Social Protection Strategy. Within this context, the Government wants to develop a more balanced strategy which places adequate emphasis on public vs. market based coping, risk mitigation and risk reduction mechanisms and complements the fanily and community based coping strategies. Those objectives are to be achieved within existing MOLSW budget envelopes. Only the insurance mechanisms enjoy implicit incremental support, as the schemes expand in coverage, and additional Govermment contribution is required. Box 1 summarizes the development of the Thai social protection system in terms of the social risk management framework. 12 Source: Thalar.d-A Social *VW_.*Tor IV, 2.VU4J 8 Thailand - Country Development Partnership Soucial rrusecton 'Bo 1: Social Risk Mansigeme'n 16iversiftafion of-Instirimen'ts to Ma'nage Risks. .'';'' .-The capacity k'o individuals; hbuseholds and..or rmunilies to riange risk and'the choice of risk :- rnanagernerit initYumenis. .epenLds upo ntile characterisbcs o.ik - teix'bou-- es, correilation.,fireqiuenc [,, andinmeosity. oarces at nsk.mayv be the resulL ot-economic potic', or may be natural (e.g. floods . -eanthquakes) risks m,ay be uncorrelazed tidiosyncratnc) or corrtlated acros's inidividuals (covariace). or. ' idiosyncratic shocks they'tend to be less effectivewh'en tctng covariae. or macro-t6pe.shocks (e.g . ollapse in buiput, high regional unemployment) Hence a lombinaton ot strategies and interventions |may.be appropriel_ to,comrbat diffirent types ofshocks.:' Lhe range ot sociat rqsk management instrument cantoe vle% etischemnatically as a continuum-I ofactions, covering informal family-base&darran'igemnenis chatiheip cope with the consequences ofrink to o.m< onnq,o ir,-ncrr, nrnro mos whot ,uhitno r:si,c .s.,,in,ow *..:i' -; anno rX A Morn;e labor force regulations chat help actually reduce certain risk T objcte o er time is to diversif the I.: available social p,rotection instruments in order. to ad. equaitcaddres the range of risks faced by society' ' pnvar nsk opingmitigtion and r-uco estrategieofrsksf wheyoiech. | '' . .table,below,.ihis*is represented by a rno,'vern ito the nght tovvard a diversified system h fi j cludersboth,public:,ard pn.vaie risk copmg, mitigaton, andIredu'crion Sr.a._gie - Social Protection Strategies asd el e nnst urmets *, Rediciion Property-rights labor standards industrial relations ;|^ 12 8 > - . -tx- S ' { | ~ t i- po!icies,employment services5 NA;A.., . on ;-f.' ' I ,-,4 nr*-mi ,I,.r,n.,r . ?. 5 * d;t -;' ' ' 1'' .n. ' * t '"' r 'n'n;- '',- '. som'e pnvate in`urance includinn pensions; ': . ,, , , ., ;,,, ^, , R:'f, . ,:,,, !--unem yrnplyerit enefits;r5 ,oping .inormai, tamwiy :inonnafor ssistance and. informai assistance and sociai and commJiunity- limited pubhi isdI~fy net's sa'fety nels -incudinIg cash and :, . . - * . ' hqrPi~r n.r nsf r. ' ; 4 .. - !.;- iJn-kin i imnclfe.m qndl nil Iii-~ . assistance _ works' ' : Man> low-ihcome, devcloping' countries- have;,,^SociaI protection .svslems charactenzed I I -~~~~~~~~~~~~~~~ih - .' predominanrtly by. inforal arrngemeints with, liited publiic intmruiments focused on risk coping the lowei.r left ran-de in the table.a i&r capitaI ncome increases with a growing fornal sector.laboi force. I aeepening- capitai *marxers ana5;insumnce .arrangernents,-ana a, more, staDie tax nase generautng I:.tGkoverar,ntm irve6eues,i',ii,lecomne'.p.ossihle tow'rove tbwarda' miorerdie'rsifed sbcial''p rn . whir r rnmnw efThdikrii h A-wiAer r . qia] ,nf 'rThnilnnn-{A 'L4'a mll in.rotrn ecoLinn; is inste es ofdersiy s-risk managTuieme iq - inrnrn, .II ; ,-:=:-'..-~; *': -:-s gernent '': 4J. iui*|^^*|'% i ^vi--o'. 8S; iijuain'' . t. '. i. ii .I,c p u, .:schemes' However, it. sould be noted't t;dmintrati capacity can always be develoqed ,n ': n Droce%s of inrnlemenunna: ted interveniOn. However:.Covernments shnuld recoEmize thar huildine thisI capacity is a high pnornty Efficiency concerns. ,'An argument against Ui 5Lhemes stems.fom "raoMl hazard viz, in its most [I.,,, -- excreme form that people will engineer job separations in order to t uneployent beeit T .;, . n:,points are relevant nere. W'First, anyinsurance'scheme is subject to some degree ot moraPha2ard'\shich .47 ' ,,.-can redu-ce l iabor market' efficiency: Tius . tradeoff, i .inberent in much of public welfarc policy: 4 fl...A-C......I _..A4 'L. A , , L,U o, U".~ .M.L49 Uf rl =u'f.b uiai; LIIIj Lk.U vudI :^S .ysh'.- "a6-. .F>-Ub ivrk. (:; w-,- ,. vvorker gets only 40%0 of the refirence age'onh 3 weeks atler job separantion, and.only for3-6,ronois ' ';'denendine on how long thev. hav'e eontrihuiedi or h6i.mak'n%iinehrnrance nrermia reflecl.rick levek (r0P I1 | , by eperience rating) ' s° ^- *iFraud and informal employmienlt The presence- of alar"ge number of inform worers cre 1 Z problemns -for any 'formal UI ' scheme: S The most obvi6os is that it b comes diffcdlt-4r.t Ui ;-i a> E 7dmnstration:to .determine'whether ia Ull,aL,namnt is in ract,unemployWed rsiiiplyT|wor1in-iniah stered ob This condition. needs ,not result from.."moral bazardh , but:it oes increasp the cost of.. sei; ^ i ..,E'UviiUrE-iSurS'uue eu'e,eisy .L LLe ..lei I' A' sEQ-''L'" - E-t r i.,-itidto addr-ehss p:roblern-'by making'the coil~c-tion o .nfiscsyJ' h eipet i trrcf timr lee h,te tn rilled naweni. in neron diirinO neal hiiinecc hnl tr n i reducingthe uicennive'ofemployedinform workerstoclajmbenef . ','i '; Cv; -'" *^.Effects.,on informal insurance meehanims a Aserious consequence; of formal Ul sysedi is hat it,. .". .iould discourage inform,al insuiance mecannisms. Itroducinc a formal syster may weaken,the .< @ f iA community nes' tbat societie rely on and which provide a Strong inlormal safety. net' ruaamiur uupIatai.uu wiin e3aJaiug tnuine t.Uu7 irEiCS Lhai U Idha U1 dLUdWr) F V1W u ystcfn .gi:should ry,and do aay with it when hey introuce. a Ui schee.' IThere, ar likelyz to. be 'igrnficaint| * , .nu PriSln4 in rnversoe, gnd emnlnuerc -arp'animF>els tn h.o vuaiin in rn^.ntrzii.a. inlni ., twiconr cooajLj- : -::~ff . perdeiveoita''an -?ddii;bnai tax. |.Sow`e. DeUFer;a ,et. al (2001,7 .Kodapivec (200>,' 732 nflfl flr uT oDU A - c ore mntS, rcnnn.ld0 n. an_nu n +ia - CTTTAA.. - -.ATT -t I, .. __2 - sX . - --- CUJ-.WIJ *o.aiuit. VIt t.fW .UIAIthr, Ulv iIUVUt.tltJi1U V l uitU. spearhead a committee (composed of stakeholders including employers, employees and other .l;.va.lt mir.isaur.aJ to overia.%.e tUIn approac.ih tovvaiua .d esr.inilgii Lithe tY sMyte.. Tilt. -UIUUUVUcLLUi of a UI system is a major task and the decision to go about it in a deliberate and gradual manner, as tilt. LL1a %JUViMi-Urnient il uduing, is tiiuruuu'vUly 'he UWbet apJproalu. li. MViUnibUy has also sensibly decided to involve the two major stakeholders, employer and employee representatives, in the steering commrlitUee that is deciding on all policy and the operational aspects ofi he system. The most important feature, however, remains the sheer size of the task. As the project develops challenges wiii arise. Tne challenges can be grouped into four categories: 20 Thailand - Country Development Partnership Social Protection 74. Appropriateness and timing. An important issue that has arisen is the appropriateness of introducing a UT scheme in Thailand, given its level of economic and social development, labor market conditions and the capacity to implement such a scheme. It may be necessary to design and evaluate Ul pilots to study the impact of the introduction of Ul. 75. Financial issues. The contribution rate, the wage replacement rate and the duration of entitlements set the initial parameters for the scheme. The balancing between benefits and contributions should be determined through a balance between the policy, program and political environment and actuarial principles. Simulation of the design or actuarial modeling of the design's effects may indicate over or under financing of the scheme and also provide information on the progressive/regressive nature of the scheme under different design parameters. It is necessary to consider how to manage the resulting fund, what types of expenditure may be allowed from the fund, and whether to continue with the same level of contributions. 76. Policy issues. There will be equity issues to consider, between those who are insured and those who are not. Questions have arisen regarding the support to be given to those who remain unemployed even after their six-month entitlement to compensation expires. A further policy issue is the fact that the workers who will be covered by the UIS will also be covered by other labor legislation, especially severance pay, and also private provident funds with a separation benefit. The role of severance pay is therefore to be re-considered. Regulations covering the dismissal of workers will also need review. 77. Operational issues. There will be a substantial increase in workloads for the SSO and the DOE if UI is imolemented. New organizational structures will be required and capacity will need to be developed in dealing with clients. All of the UI procedures need to be reviewed, incluiding the nrenaration of detailed onerational Puidelines for staff documentation fornns public materials and so on. Another major task will be in the development of appropriate information technnlnorv 78. Th.e main objectives of the CDP-SP exerrise in UI are nc follows: I sist "Le UovemULLent mn assessing wfle overal.v l appropriate.ressof UT rd.-A MO.T,L SW's role in the development of a Ul scheme; and i a Ul scelleiie is Uevelopedu, assis ,he 'Gve,-IiUIIiit III t,he Udei51 VI a UI schemeV uhat is appropriate in the Thai context. 79. CDP-SP Reform Priorities in UI. CDP-SP focuses on specific aspects in the four issue areas. Priorities for cooperation during this period will be reviewed periodically, taking into account the work already being undertaken by other agencies. A recent ILO study on the proposed UT design has addressed a number of the pending issues, and has helped CDP-SP to focus its work more specifically. JICA has indicated that it will continue to provide assistance to the DOE in assessing its future operational needs such as staffing, staff training and development, physical requirements, and operational guidelines * Appropriateness and Timing. Assistance is provided to MOLSW to develop pilots to test various design parameters and the viability of iabor market programs in support of the uT system. This includes studying the capacity of DOE staff to monitor UT requirements such as worK search and worK availability. in addition, the pilot informs the coordination 21 Thailand - Country Development Partnership Social Protection requirements between DOE and SSO, including data needs, program and policy consistency, and administrative and 1T requirements. * Financial Issues. CDP-SP provides assistance in developing a simulation model to review the financial sustainability of the proposed UI system. This model empirically estimates the sustainability of the proposed Ul system under various design scenarios and parameters, utilizing the Labor Force Survey carried out by the National Statistical Office. The main objectives of the exercise are to assess the financial viability of the scheme, to determine the benefit incidence of UI, and to analyze how financial viability and benefit incidence will vary with changes in the design parameters of the UT scheme. Capacity is built within MOLSW to operate and manage this model. * Policy and Operational Issues. This component assists in reviewinz the relationship between the UI system and areas defined by other labor legislation, particularly the provisions for severance pay and iob security, and explore strategies that the Government must develop for improving the effectiveness of employment services and other active labor market Drograms to assist DeoDle who become unemDloved. and reducina the disincentive to employment. The recent ILO study will provide a firn foundation for this work. CDP-SP will also nrovide assistance to the Government in the develonment of a IT implemtntation plan. National Stuti0irm! Offlrie 80. The National Statistical Office (NSO) is one of the Governm.ent agencies -ith a department status under the Office of the Prime Minister. The duties of the NSO are data co !!ection, statistica1 mn.fnrm, .tio~n se ics sttsia co ord. mation p. isionofstaistca technical assistance, and training in statistics, and computer data processing. With respect to A.+.a colletion fLe'KQ NSO -e --- -Asue and -unes to-coletoll--+ aio on socia ar.d-- LUU itk LLJl ..A "--L. V."'Wlt JU '.'L UOUO%.. ~ALI OUR Y~.O LV A1t,VI.L uLVILiLaLIVI VIa Vt,II4IU economic conditions of the country according to international standards. The statistical LL sr c.-om NSO consisto d cL. NSO's censuses arnd uuuiu aLn ~I VI-J LVI 114JLJ L.V11 It uaL42 %.~vI1Ipvu uuvugii UIr. J.40'J ~ IUV uU surveys as well as data produced by other statistical agencies. These services are disseminated uLrouuul puUbitioLnsI, iroIVdaULU andIU 111LUadaL. iiIV NSO hias organized a system for self services by computer and also by internet. 81. Following the economic crisis in 1997, there has been increasing demand for more comprehensive and timely data especially data on employment, unempioyment, income, expenditure and establishment statistics. The NSO is the lead organization that collects data on employment and unemployment through the Labor Force Survey, data on income and expenditure through the Socio-Economic Survey and establishment statistics through several establishment surveys. The Labor Force Survey has been conducted since 1963 and is now being conducted on a monthly basis - it is recognized as a source providing the most reliable data to date on labor market information in Thailand. Socio-Economic Surveys have been conducted since 1957 and are used in explaining levels of income, expenditure, and income distribution of Thai households. NSO has been conducting Establishment Surveys and business, trade and service surveys roughly every two years since the late 1960s. These provide information primarily on size, expenditures, revenues and assets of establishments in the formal sector. 22 Thailand - Country Development Partnership Social Protection 82. The Labor Force Survey Program was launched in 1998, with assistance from the ILO, to improve the content and timeliness of the survey, and the revised survey has been implemented since early 2001. However, the operating procedure of the SES have not been improved or revised significantly for some time. There have been complaints about the content, timeliness and dissemination of the survey. Similarly, the establishment surveys are outdated. Hence, these instruments do not fully respond to the needs of the end-users (e.g. MOLSW). 83. The main objectives of the CDP-SP exercise in this area are as follows: * support improvements in survey instruments which seek to assess the socio-economic, and labor conditions in the country; and * ensure that the data are appropriately utilized for policy and planning purposes, and develop timely and user-friendly dissemination practices - esneciallv as they relate to DOE. DLPW and DPW in MOLSW. 84. CDP-SP Priority Reforms in NSO. In order to attain the objectives stated above, CDP- SP wil fhnocus on the fiolowing reform areas: (a) improving dissemination strat.egy; b) enhuancing the timeliness and relevance of the socio-economic surveys; and (c) enhancing the timeliness and relevance of the establis.i.ent sveys. l,r.n..nn Su.ney, nrt.i,n.Oft ,°c Soci-;J-Cflor.nhh.D Suney.a T.he rrain objective of *is component is to ensure that the survey is more appropriately designed in meeting the needs of the users. T.his will be dofn tA- IV51k- .h ulA..n U.r.tttoA! --od -t L :...1.o g the sampling frame and design. Emphasis will also be placed on improving the classification of vartables in1 uiSE ar.d on v rs uirin ujaL Uth special ImoVules iai are to%, LV V%, U1jJU1GLU ul the SES are designed and developed appropriately. Improve Survey Instrument of Establishment Surveys. The main objective of this component is to ensure that the establish'lmllent surveys are nmore appropriately desigled Hi meeing uie needs of the users. This will be done through utilizing international good practice in improving the sampling frame and design. Attention wil; aiso be paid to improving ute classification of variables in the establishment surveys. Improving Dissemination Strategy. The main objective of this component is to ensure that data are appropriately utilized for policy and planning purposes through developing timely and user-friendly dissemination practices. This will be done through establishing statistical database management system based on data warehouse technology and developing data communication and data exchange tools and guidelines especially those needed by the agencies concerned (e.g. MOLSW). Occupational Safety and Health (OSH) 85. The Departnent of Labor Protection and Welfare (DLPW) has the mandate for the safety, health and welfare of workers. DLPW comprises 17 divisions dealing with OSH related issues, the National Institute for the Improvement of Working Conditions and Environment (NICE) and its 17 regional centers, and 75 Provincial Labor Protection and Welfare Offices and 19 offices in Bangkok. 86. OSH services provided by DLPW include OSH law and enforcement of regulations, issuing national OSH policy and plans, providing technical assistance to enterprises to improve 23 Thailand - Country Development Partnership Social Protection OSH conditions, providing OSH training and information, launching OSH public information campaigns, and carrying out investigations of serious occupational accidents and related diseases. Some of these activities can be carried out by private organizations, and NGOs as well as universities, which can be contracted by DLPW as the need arises. 87. In addition, the Workmen's Compensation Fund, managed by the Social Security Office (SSO), seeks to compensate employees who are injured, sick or disabled as a result of work- related activities. The Fund also provides limited financial support for some preventive OSH activities of DLPW, NICE, other health related Government agencies and the private sector. Table 5: Compliance with OSH Laws (by size of enterprise) Size [ Compliance Rate (%) 10-49 14 50-99 33 100-299 56 300499 66 500-999 71 1000+ 61 Total 38 Source: ILO (2000) 88. Improvement in OSH conditions faces significant challenges in Thailand. Recent evidence points to a sharp rise in the number of workplace injuries and accidents (as measured through the number of claimants of the workmen's compensation schemes) - these numbers have risen over three fold in the 1990s, 1 - and the measured accident rate er 1000 j Figure 7:Workmen's Compensation Fund Balances workers was over 33 in 2000.' While (Milon Babt) the economic costs of these injuries/accidents have not been measured economy-wide, 1200C (unrepresentative) small sample surveys B lo0= _ carried out in Thailand indicate that they I o 80o-0 I are likely to be significant. For example, a s- productivity loss due to workplace | 4__ __l injury/accidents was estimated to be in | 2000 E l the range of 5 percent to 10 percent (ILO 1992 2000).' Compliance with OSH 1W 1W standards is also quite low in Thailand. 99 1999 2 A survey of close to 1000 Thai enterprises carried out in the late 1 990s, [ l showed that less than 40 percent of enterprises are in compliance with the OSH standards (Table 5). 19 The corresponding number in most developed countries is below five. Furthermore, in Thailand, this data only Covers firma with If nr mnrP wurlP-t.re Thic ic ikPely tn hp. An i,nd erpgirnatp hPnAmp , as discs-1a I.t-, *),. is significant underutilization of the workmen's compensation scheme, and the scheme does not cover enterprises with small enterprises where work related injury and accident rates are likely to be significantly higher. 9 A longitudinal study of several industries in Japan and the U.S. since the early 1980s, shows a 50% percent decrease in the number of workplace accidents/injuries, with around five percent productivity increases attributable to these declines. However the study did not look into the cost-effectiveness of these improvements. 24 Thailand - Country Development Partnership Social Protection 89. Although dangerous exposure to workplace risk occurs everywhere, the situation is particularly severe in small and micro industries. This is a fast growing sector of employment in Thailand (especially following the crisis) - with enterprises of below 10 workers accounting for over 40 percent of total non-government wage employment. Enterprises with less than 10 workers are not covered by any OSH legislation, and while no data exist for these enterprises in Thailand, international evidence shows an inverse relationship between workplace injuries/accidents and firm size. The accident rates in the small-scale enterprises may be 30-50 times higher than in enterprises employing more than 1000 workers. 90. A Workmen's compensation fund insures workers injured on the job (or those affected by occupational disease). Over 70,000 employers contribute to the experience-rated fund in Thailand. However, the fund is underutilized owing to cumbersome administrative procedures for receiving payments and the relatively low level of benefits from the fund. These issues have contributed to current reserves of about Baht 10 billion (Figure 7).20 Reviews have indicated the need for extending coverage, reviewing contribution rates and ensuring that the scheme remains a sustainable workmen's protection scheme. 91. The reasons for these problems with OSH and Workmen's compensation are manifold. The Government does not have a coherent nolicv framework underlving the management financing and implementation of OSH policies and programs. This is further highlighted by the lack of a comprehensive database on ORHR Emplovers comnlain about the lack of coordination (and often conflicting advice) between DLPW and other stakeholders (e.g. other ministries, emnlovers trade aqsociations, iinionn) which also have a role to nlav in the adminiktration of these programs and are quite active in this area. 92. While DLPW does an admirable job under the constraints it faces, it lacks the resources aO,A ... a,;*-, thi aAmince,*- hptt.r irV-4 vtonflire p .Ianra l nP r Avamnl. in 1000 ;i]It f^.r fl%IjJs.flLJ tJ0~f_l .flV - .__ - S - --j2Jt - - - *Jt d J- percent of registered establishments were inspected (Table 6). Table 6: Proportion of Establishments Inspected in 1999 Sector Inspection Rate (%)oI Q Q Manufacturing 6.9 1TVTt;];t.tiC . Construction 5.5 Trade I2.6 Transport 3.0 Serviceq 1.7 Total 3.8 Source: Kogi (2001) 93. Another issue is the relative lack of coordination between DLPW and SSO. and questions on whether the Workmen's compensation fund scheme should be linked more closely to OSH and finance improvements in quality of OSH programs. The Government has emphasized that this is an important issue for. consideration in the near future and other stakeholders are also of the oninion that greater coordination will be an important sten towards the delivery of efficienct and cost-effective services. 20 Source: SSOu UL. 25 Thailand - Country Development Partnership Social Protection 94. The Thai Government, through the CDP-SP exercise, seeks to develop a reform program which will improve the effectiveness and coverage of OSH and workmen's compensation. Tne main objectives of this program are: * Improving OSH standards and regulations and the level of compliance; * Developing innovative programs and incentive schemes to improve workplace safety, especially in MSMEs; and * Improving the coverage and efficiency of the workmen's compensation scheme to better assist workers affected by OSH accidents. 95. CDP-SP Reform Priorities in OSH. In order to achieve the above objectives, the CDP- SP reforms focus on the following reform areas: (a) policy reforms and programs which seek to reduce or eliminate the likelihood of iniury at workplace; and (b) reforms that seek to assist workers cope with accidents or injuries once they have occurred. These initiatives cornplement assistance that JICA and the ILO are providing to DLPW and the SSO. * .fnr.tituti.nnl and AMfangcePmPnt RPpfarm An imnnrtnnt element in reduiingn acd pnreventina injuries at the workplace is by improving the institutional and management environment that gnoPrns OSH ct.anderid in the wrkinncep. Whih!e evidnnGp firnm Theilsand ki lirnitpd international experience shows that substantial gains can be achieved in a cost-effective M.anrner; Studies exanmne the feasibilitu of alterna.ative instii.tional frameiorIrc, (e.g. autonomous and self-financing institutions) to manage OSH services. In addition, high quali4- agerr.ert of OSVT-T -li;cis -nA nrnrome i vit fa r --poi;A.ng a safe er.irnnrnanf for workers. The Government in collaboration with ILO and JICA has begun a program of r.eviewing he relevance a- d compliace with workplace safety stadAr-ds. CDP-SP program augments this effort by evaluating the current organizational structure of TvL,r IVT 4rVMIIW'1 LV UL L.UIIIL LJIl UUJVi%L1V,e. rUUIVIILUILX, IV1W VVIWII UG 1iUIUUVLiU LU study the incidence of accidents, coverage of service, and the adequacy of programs to uduu[ub OJSrI issues ari1U aWssessmen-s will Ue car.nied out to exLarnfliriVe OSHM Uoincer;, ^1 U'l t,. informal sector. * OSH Information. The current information on industrial accidents and workplace injuries are not systematically collected, and are often incomplete and outdated. CDP-SP assists in building a comprehensive, reliable and timely information system on OSH accidents. * Regulatory Reform. The expansion of small and medium scale enterprises and the informalization of industrial production has resulted in many Thai industries being outside the scope of existing legislation. This necessitates a review of the current legal framework and its adequacy to protect workers. It is clear that new legislation needs to be introduced to address home based workers and agricultural workers, and exposure of children to hazardous working conditions. The Government also needs additional resources to create awareness of stakeholders and implement training programs to increase the compliance of OSH standards in Thai industries. The proposed partnership assists the Government in developing appropriate legislation in order to promote partnerships between OSH stakeholders. * Improving Workmen's Compensation. While the above reforms are intended to contribute towards reducing the number of workplace accidents, it is also essential that programs are developed to address the needs of workers injured by industrial accidents or affected by occupational diseases. The CDP-SP program assists the effective development of the proposed exnansion of workers comnensation nrogram through technical assistance. It will 26 Thailand - Country Development Partnership Soc.al Protect.o,Uri also bring to bear international exnerience regarding alternative nrogram desian (including the use of IT) and financing options on the proposed reforms. A crucial issue that CDP-SP will nrovide guidance on is how to build a closer link between workmen's comnensation and OSH programs - an option to be studied could include the creation of an autonomous institution where these functions will be merged. E. Risks 96. The CDP-SP involves no direct investmnent in civil works or other infrastructure projects, ariU Is 1IVeCreor CAUdUUd from uic puIview VI WVIlU BdIk safeUgrd po:11icies. riuwever, uhire are other risks that attend the implementation of a capacity building and reform program, and tnese need to be recognizeu anu mltgateu. rirst, there is thn risK tnat grant Iunds maue availablc to the counterparts will be mis-allocated. Second, there is a risk that the reforms that are implemented with CDP-SP assistance will fail to attain their objectives. I nird, there is the risk that the Government will disregard the reforms/advice being proposed through CDP-SP capacity building activities. Fourtn, there is a risk that the Bank will be unable to mobilize sufficient grant funds to adequately finance the CDP-SP. And last, donors long active in the social protection field may feel crowded out by CDP-S-P ana oppose it. 97. The financial risk is limited by the good track record of the MOLSW in implementing a loan project, including audits. The second risk of program mishaps or failures can be addressed by effective capacity building, but not entirely. New initiatives such as Ul could encounter implementation problems. However, the accountability for these reforms is clearly with the MOLSW, and other donors are collaborating with the World Bank in supporting the chosen reform areas. Similarly, regarding the risk of reforms and advice being disregarded by the Government - as stated previously, the accountability lies with the Government, and the Bank (or the Government) can exit the partnership at the end of the first year, if either side is unsatisfied with the progress of CDP-SP. On grant mobilization, the Bank team has done well so far, with about $700,000 from various sources in hand or already expended. Other sources can be explored. Donor relations are at present good, but there have been in the past concerns and frictions, which the WB and the MOLSW team have been able to allay. This will be a continuing area of attention during CDP-SP implementation. F. Outputs 98. -u "AFn~ i.. F4 apet of uh puvtnF"s`iF la the1 `emphOasis x on %" ope co LLtaLt:r and dialogue. In order to ensure the participation of a broad range of stakeholders in CDP-SP and Wlur:;piau Ulbb,11ILULLiVIV UL U r jJUIAlailU alU It 0 a%4AIIVVilkilW%, L11Q jJUMVIbIIMl Will UnIUeL several activities (in addition to consultant reports/studies) to facilitate policy development within the CvMP-SP. pdal.,LLership. S"MkU-1eho0ders Xrorr differentI GoVVUllerlt;U 4gUenikolUb luh priva'e sector and workers representatives are invited to participate at every opportunity. CDP-SP outputs include: * A joint wori dBank-MOLSW CDP-SP iaunch worKsnop; * Regular technical level workshops in each of the five priority areas; * Establishment of a joint MOLSW-World Bank monitoring and quality control system to assess consultant reports/studies; 27 Thailand - Country Development Partnership * A review renort- of which the nresent renort is the first; to assess nrogress on various planned activities in the first year of the partnership (and continuously depending on whether the partnership is extended); * Periodic "policy notes" or "white papers", prepared by the CDP-SP PIU, for the internal ruirvw Apuvlinmont nrnriAce within Mr)T RW nn kt-v ieeiie thnt hnuve 1rere.ived substantial CDP-SP support, with the first planned on Unemployment Insurance; * A end-o reie workshop (i-n- S te...ber 2002) to present he .n-z f ,_A.- of the review report and decide on activities/benchmarks for the second year of the par-lerlship; ar,d * Technical reports that explore in depth specific Technical issues in social protection. G. Development Impact 99. CDP-SP is intended to help Thailand develop a balanced social protection strategy through complementing the currently existing informal risk coping mechanisms with a more diverse set of public and market-based risk reduction, mitigation and coping mechanisms. CDP- SP is not a comprehensive program of reform in social protection, but it is evolving, based on priority areas for reform as identified by the Thai Government. The scope of CDP-SP is expected to expand further over time as priorities are revised. 100. In the relevant priority areas, CDP-SP seeks to improve the targeting, efficiency, cost- effectiveness and equity of social protection services. This process is aimed at assisting Thailand to develop policies and interventions in a manner that will promote inclusive, equitable and flexible labor markets and offer the poor and unemployed better social protection services. Specific targets and benchmarks for each of the reform areas are listed in the Development Matrix in Annex I. Monitoring and evaluation is a key feature of CDP-SP. Monitorable indicators - which are part of the benchmarks - e.g. assessing improvements in coverage; equity; and cost-effectiveness - are in the process of being finalized for each reform area. These will be measured using baseline and follow-up surveys, some of which already exist and others will be designed through CDP-SP. !1.A If the intended reforms are s-uccessffullv imnlemented; some of the systemic nrohlems of Thailand's social protection programs can be alleviated. These reforms are expected to lead to the forlowing impacts: : Mo4re A neffecti;e pFo.tyl- ty-if.-on and social assistane programs f,. ose w-6 no other means of support; * DeVIUeIVopmL VI socia:M 1isUrJIUan HrIUU11ecisms L'ha;L Will prUviUd aULUtlolmLIc; UirLaSWfer LU those affected by sudden shocks from unemployment or work-related injuries and allow firms greater flexibiiity to adjust to changing economic conditions; * Better information that will enable policymakers to target interventions in a more timely and effective manner; * More efficient labor market intermediation that will enhance the quality of employer/employee job matches; and * Safer work environment for Thai workers that will enhance worker and firm productivity. 28 Thailand - Country Development Partnership Social Protection 102. CDP-SP was launched on July 30, 2001 with an exchange of letters between the World Bank and MOLSW committing both institutions to supporting the first year of the partnership. As mentioned above, MOLSW has appointed a project coordinator responsible for overseeing the day-to-day progress on the project. In each of the five priority areas, task team leaders from MOLSW have been appointed to coordinate the respective technical assistance and capacity building activities. 103. Activities were initiated in each of the policy areas following the launch, based on the development policy matrix (Annex 1) and the achievement of benchmarks has been closely monitored. Below, the activities undertaken under CDP-SP through June 2002 and progress made to date in each of the policy areas are assessed. SocialAssistance 104. There is general consensus that the timing of CDP-SP assistance corresponds well with the impending reorganization of Government and DPW in particular. In October 2002, DPW is expected to be. separated from MOLSW and becorme part of a new ministry dealing with social welfare' issues (The Ministry of Social Development). This has presented a unique opportunity for CDP-SP to contribute to this time-sensitive reorganization process. CDP-SP has assisted DPW in this reform process through a set of priority technical assistance activities. 105. Two sets of studies have recently been completed on: (a) management and administrative reforms of DPW and social assistance programs; and (b) program coverage of selected target groups and development of monitorable perfornance indicators. Preliminary recommendations from the studies were nresented to DPW and other stakeholders at a workshon held in late 2001 and the final reports reflect the comments received at the workshop. 106. With regard to management and administrative reforms, recommendations include: * New role ofDPW. DPW should move away from direct provision of social assistance to a policymaking arnd monitoring role. T.h. -ill require estblishinPg a research unit and monitoring and evaluation units that can propose program and policy and assess success. nPWl staff.a als serv a aa -t ulAing a.-A -onslting A,--+ton wi+.h loca Lf Y Z 1 *11(4)L Ufl3J . 1. s l Qfl'- VUIU(J11r5 ((41( %Vl.t'J* uI* *ll1(1J1 VVT 111J.0 Government and private service providers. A near-term recommendation is to undertake refonV-L, wUrks11ps fr l vV Va LloL LU ILIhe UIV111 UlUrINaM4iU a4u rl.U11,ibULV LU UIc %A1aiUrUI role of the new ministry. * Capacity. Different anu ennancea capacities oi DPrw staif wiii oe requirea wim ute new role. A premium will be placed on policy analysis skills. It is recommended that a curriculum of capacity building courses be developed both to train DPW staff and local Government administrators, leading to the development of manuals and guidelines for the new ministry. Tnis should inciude courses on policy analysis, monitoring and evaluation, and public management. * involvement of CSOs/NGOs. More attention should be placed on developing private and community-based services. Consultative boards should be developed with DPW, other Govemment, CSO, and NGO participation to include civil society and stakeholders in the policy-making process, and to help monitor local delivery of services. 29 Thailand - Country Development Partnership * Service provision and funding. While funding will largely come from the central Government, social assistance services will be increasingly provided by provincial Governments, Tambons, and nrivate providers. It will be important to develop funding allocation mrechanisms that are responsive to social assistance needs at the local level while ensuring a high degree of fiscal discinline. One notential funding mechanism that has been suggested is that of block grant funding from the center to the local rGnvernments. 107. DPW is in the process of developing ctaff and pro--.ess guidelines for the new minitry, incorporating suggestions from the CDP-SP assisted study. 108. Conclusions and recommendations from the second set of studies on program coverage ant. indicvas.to. 3 na.tlute. Low coverage, good relatfve largetin-g. ELIsLiLUg %-..U1IsUdfer1 piugraIlLb IfI cUilUre aWlU the elderly are generally well-targeted in reaching the intended beneficiaries, but do not cover an aucquatt iiuimbur o0 U0ls inI nIeeu. rsaLlUIMlULiUOnL tO a mU[C lllllHZLU SCI 0l assistance programs will be needed to improve coverage. * Need for monitoring and evaluation system. A data collection and processing system should include a selection of key performance indicators that can be routinely assembled from administrative sources together with periodic surveys of beneficiaries and administrators to assess impacts and suggest program improvements. It is recommended that CDP-SP should assist in the implementation of a pilot monitoring and evaluation system. 109. In addition, guidelines and manuals on using monitoring indicators have been produced for the consideration of DPW and the new ministry. 110. CDP-SP has also provided technical assistance/capacity building to DPW through workshops and training activities on international good practice and experience with social assistance and cash transfer programs. 111. Based on the first year studies and workshops, several types of follow-up activities have been discussed, including training and capacity building activities for DPW staff and local administrators, and the implementation of a monitoring and evaluation system on a pilot basis. 112. In addition, CDP-SP will assist DPW in undertaking a risk and vulnerability assessment with a view toward developing reform priorities for the new ministry. This assessment will systematically examine the size and characteristics of vulnerable groups in Thailand and assess the adequacy of existing social protection measures addressing those risks, identifving gaps in program coverage and adequacy. The analysis will focus on target groups of DPW and will also include other vulnerable segments of the Thai labor market. Specificallv. it will consist of five elements: (a) constructing a typology of vulnerable groups; (b) constructing a profile of key risks and shocks and assess their impact on the noor and vulnerable: (c) examining household and community level risk mitigation and coping mechanisms; (d) studying formal risk ManinaPrennt and snoci2l nrntertinn interventinn and 2ssessing their effertiveness in reachincr and protecting key vulnerable groups; and (e) providing recommendations on ways to enhiance the e.eCfix, and afficiencyu of snrcia nrntpitinn nrngrrmrn anti nnlicies It is antieirnated the social risk assessment will be an important input into the design of the Fourth National Social UJ14 .Are d Snocal Work Parl . being A ewln,-eAl hu MAAO LW 1.rher ther CDrP team.. and DPI 30 Thailand - Country Development Partnership Social Protection will work together to develop the capacity within DPW to conduct this exercise on a regular basis in the future. The risk and vulnerability assessment has been launched in June 2002 and will be completed by the end of 2002. 113. Notwithstanding some concerns over the pace of the early phase of the ongoing studies, the social assistance component is on track to achieve the CDP-SP benchmarks for Year 1 (Table 7). Table 7: Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Social Assistance Benchmark | Progress To Date Main CDP-SP Capacity Building Related Benchlark Progress ToDat lPartners21 t to Benchmark a DPW develops guidelines Benchmark to be - Study on management and for roles and responsibilities achieved in Year 2 administrative reform of DPW and social for new ministry (Ruiaeiines Deingz drafted) I _ I assistance activities. Conduct regional/ national Benchmark achieved AUSAID, - Study on management and wo,rkshops on Pfrien- A ly 1n a..mind-tH-ti-e refor.. of DPW. and coverage issues with - Study on coverage of social assistance cash-transfer programs programs and developing a set of monitorable indicators. - Workshops on management, coverage _ Iand cost-effectiveness issues. DPW develops guidelines Benchmark achieved AUSAID, - Study on coverage of social assistance dn raft indicatonnrs and deoi a s_ tof manuals for monitoring cash monitorable indicators. transfer programs _ Workshops on "Challenges Benchmark achieved ] AUSAID, - Workshop on international good of Decentralizing Social ADB practice on cash transfer programs Assistance: Internationai - MOLSW staff participation in Worid Experience with Cash- l Bank training course on social assistance.| Transfepr Programs I I I I Ermpoyment Services !14. Worlk in Ye 1 hI - nnp-e on initiai.*ng the de-e1Jpm... .. a Labor Market Information System (LMIS). In addition, preliminary work has begun to examine international exerience with employmr-t servicesr, e -lvc dapibl:ytoeT.icrte ,,n.. it. tapa7...nto~nv a... au~. .en ,ae V ..n. "u.n "jFI.`.cu.111V Iti JLr I .a.t4iL'- lI C. Dut-irgthe c.isis, it Uecairne clear thuat IUe ilac of ar.alysis and dVIisseir,tio of information on labor market indicators hampered the timely response of policymakers. Under CDP-Or, LAVLL actviAiesLIU sUive '.o iiipirve u gesircigraial ayi.luidal capliva.0y o Vif L LW 10 understand labor market dynamics in Thailand. Furthermore, these activities are intended to imiprovU iaduI m1ar'st inUfir,-,4L.ion availabI: LU users, uicluding workers, iirms, researchnrs anu other Government agencies. The development of the LMIS is a highly collaborative process, involving DOE and tifu users and providers of labor market imormation. DOE's primary partners in this exercise are NSO, SSO and institutions specializing in labor research/analysis. 116. As a result of the technical assistance provided through CDP-SP, DOE is in the process of producing quarterly country-wide labor market information reviews, and annuai in-depth regional labor market reviews. These reports provide basic employment and unemployment statistics, occupational supply and demand information, wage information and industry sector 21 Partners have played varying roles depending on activity. In some areas, activities are being carried out jointly with partners, while in others, partners play more of a consultative role. Partners also take the lead in some of the activities wiun CDur-ar playmig a supporLuig role. 31 Thailand - Country Development Partnership Social Protection analysis. The first set of quarterly reports have been prepared and the first program report is expected to be produced early in Year 2. 117. In order to ensure the sustainability of LMIS, it is important that a permanent LMI office be established within DOE. A study was initiated by CDP-SP to determine the appropriate administrative arrangements of such an office. This study has recently been completed and DOE is in the process of studying these recommendations in order to decide on the structure of this office. Box 4 .ssues Faeing Emplo nmet Services'in De'veloping 118. DOE, as the main provider of job search assistance and job- Tthe issues .facin2 the -emrlovment senices in Thailand are brokering services in Thailand, is l. similar to those facing employ ment-services'in many' de'eloping' keen to improve the efficiency and | *ountes siorldwide; Based on international experen.e certaun.] coverage of these services. As a first aspects thaL should be taken into account in designingI employment serices 'mithese countries'include: . . m r' ste towards servce mDrovement. .. CDP-SP has assisted with the |. Sen ices should-be designedtkirg ino ac&,wir;country prenaration of a background report l " siecifi situalonsand capacitv and-not transpose ch'ac` dsion- on international good practice and | of he service deVelopedcountriesc experience with the management - . A starting point i the design of an effecti syst..m should design and evaluation of b the a%ailability.of goodl quality labor mnarke't infcnation t .e .se -o4 for Emphasis should be gisen to the role that the-public sector'. or s e (se Bo-- --4 %, snould piti) in reCiLiun io %privaie ernp1o)TmenL agencies. some of the main recommendations). J .Nechanisms should be.des eloped to ensure-that the. pvate This report was rece.ntly pvresented to ;I axe~nries ran nperie oimpnei;vetlvl ;with the niihlw sertnr1 DOE staff at a seminar. Based on - -arket type mechanisrs should also be put in place to'make the recommendations, DOE is , . public services more responsive to-demand. ..._recommendatio_s..D.O._ E... Eploent services are diree y linke-d t the proposing a set of capacity building . administration of unemploment insurance through activitiesfl a.ndrio *flsAfl~J~'.t......for.. e ' registering . ciaimanEs* ienecKiung .eneni eiigioii1Luy ano next phase of CDP-SP. These .. e er1l) ing lob-search aIci' ities includeA rev,ietning the exs in - .. FfTpriiu, jnh b.ntF.rino cpn,g.;-p> rp rr.r,sI imn rnmnm!r,p .kt institutional and management hase insfituted unemployrmnent m isura-nce s)st,ems,-in order to, structure, program expenditure - expedite- the process of matching jobop'po rnies with.] bUU LUIVI, pIJIVaI V1AlJV1UtWJL auu . . .-- .. effectiveness and making specific benefi, t re.ipients .-.. .1 recoIineriidieatiuiLs 0 fr [eoUII inL the L5 rCDP-SP aiMs to'asSist tne Governrment in insinuring'reforms in areas. Given the important role that | theseandiied areias. ' . ' . - . _ employment services are expecteu to play in the implementation of unemployment insurance, emphasis will be given in Year 2 of CDP-SP to assist DOE in thinking through reforms needed in tne employment services to accompany the implementation of unemployment insurance. 119. Progress towards the achievement of Year 1 benchmarks has been highly satisfactory (Table 8). It is anticipated that all Year 1 benchmarks will be met on schedule, including training DOE staff in labor market analysis. Table 8: Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Employment Services Benchmark Progress To Date [ Main CDP-SP Capacity Building Related IPartners Ito Benchmark MOLSW decides on location Benchmark achieved. ILO - Study on administrative structure of f01 focal pc0intfLr anaiysis ALuinim. sUucLUIr bUing ULvi o r developed 1 Lanhor marketIconsultat Renchmark achieved IL O Consultant hired to nrovide regular 32 Thailand - Country Development Partnership Soc ia! Prrtapticfn, Benchmark | Progress To Date | Main | CDP-SP Capacity Building Related | Partners to Benchmark recruited to assist in preparing technical assistance to LMI staff on LMI LMl report analysis and report preparation Staff of DOE trained in area of Significant progress on ILO - Training for LMI staff being undertaken| I-or m-ket , lysis achieve ... er.: (ongoing) . .......L.+1 , by cnrsu LMI office produces one ISt set of quarterly ILO - TA on LMI analysis and report volicv-relevant report on LMI revorts vrevared -orevaration Seminar on International Benchmark achieved ILO, GTZ, - Study and workshop on International Experience on Job Placement AUSAID good practice on design, implementation Design and Implementation and financing of employment services - Participation of MOLSW staff in World _ __ __ _ laim uai_ningoUM vonLaD_Mar= in 1 l1l l 2001 and 2002. Unemployment Insurance (UI) 120. UI is the newest priority area in CDP-SP. All Year I benchmarks have been satisfactor;!y, atainef alanong with sor A -rogress on achieving somA e Yar 2 bench..a.-ks. 121. As z first~~~~~~~~~~~~~~~~~~~~--.r step Cn --S'__FP -a bee zssstr. -OS nie..fir n sus htrqi- I'"ll A . a 4r-+ ..*,, (W'SD_QD 16-.. i.,,.,.a. .-:.44__ 'NACT (C J i ... 11SiS. £LS 11.1 S-.L.O 1JL1151 U~Wl LO Ot ir, 1-JJ..1JL3 TV iil &UV4iIIJt11yHr 1aaUVI3 LLIaL I"-4un" careful consideration as Thailand contemplates implementation of Ul scheme. Some of these include: * Appropriateness of Ui. Piloi programs wiii need to be designed and impiemented to test design parameters and the viability of labor market programs in support of the UI system. * Financial viability and sustainability. The contribution rate, the wage replacement rate and the duration of entitlements have been set in principle. But the sustainability of the resulting scheme needs to be tested under different economic scenarios and under different models of coverage and compliance, using simulation techniques. * Incidence/distributional patterns of the current design. Simulating the implementation of Ul using the Labor Survey allows the testing of the distributional effects of the Ul design, between regions, between firms, between different wage groups; * Implications for other labor legislation. The UIS will cover the same people already protected by the Labor Protection Law and other labor legislation. The role of severance pay will especially need to be re-considered. 122. The following activities have been identified in which CDP-SP will provide support in Year 1 and the first half of Year 2. They are: (a) building up the capacity of the UI unit and assisting the unit in developing a policy note on UI; (b) reviewing the financial sustainability and distributional impacts of the proposed UI system through construction of a Ut simulation model; (c) conducting a pilot UI project in different regions facing altemative labor market conditions: (d) reviewing the implications of UI on labor legislation; narticularlv severance and job security regulations. 123. The capacity building of the Ut unit is proceeding through technical assistance being provided to the unit in the areas of identifving critical issuies involved in the devew pme nt of a ITT scheme in the Thai context, providing the lessons of international experience in the design and implementation of I T schenes, and the drafting of a policy note on T T. Furthermore, CDP-SP has sponsored several workshops to discuss the findings of these reports and studies. These are ongoang actiities anr.d wi11 rru can i Year 2. .1r5v ... 5 actn..IJ- ... in -.e 3 33 Thailand - Country Development P'artnership Socpia) P.nto,'eti,rn 124. The development of a UI simulation model - a Year 2 benchmark - has been completed. The model simulates the financial sustainability and distributional implications of the proposed UI system by imposing the proposed design parameters of the system on data from past labor force surveys. Furthermore, the model also allows sensitivity testing of the outcome variables to changes in the design of the system (see Box 5 for some of the preliminary results of the simulation exercise). This model has been developed (using the STATA programming language ,.-The simulation exercise has used data from'the third round'ol:the Thailand Labor Force Sujrv,eV (1FS) from'1990-2000 to look at the financial sustainability, and distributional implicarions' of the'propo'ed Ul sysietn. I*Jhese .data 'are ideal .because -the LFS contains binforration -on rmontoly waes. unemployment status,, unempiomnenE ,uurliuon,. uiju. 'vnuu, iIar LicflSLiL5.agc,..ec, cu,dLJU1I. regiu rcsidu.liiUusLry;of employment, and size of eStablisbren ) N or every 'ndividual. '. -' :c-.. .' . The pauramneters ol' the -model -are.th assuLimed.arameters-of the proposed Ul system. including contnbution rates, premium caps, and beneft clai.s 'hese:can be chaned as desired to determine the impacts of the proposed JIsem -, . ' ,'. Thc, -.ir!.a1ion "- shui .%. Iniai, irilarily U^INiy,'' au. zo.C [UAis,IWi. 1..~ r .esSo U. UJURer.IL..u) [;it:]!! -Thadland,, the proposed,.UI scheme iwould be highi odver munded -in;2000; for eicrmple, aggregate premniumri ro!!eerionns .wuld.haze been o6er-Bahr 11) billion. while claims na,vout w`ould have vbeen less thanine'.illion babt; If the scheme had been in operationr-since 1990, it would have generated a surplus.of close to.9'billior balit by2000. The resulis also show that tie pr'oposed scheifie is also Iikely: to be regressive', ih low'er- educated lower-wEe workers subsidizing the higher-educated high-w wrkers I. ~ ~ ~ ~ . - --- A" ..JCI~,L~ 19 aIm,a3 Thiuw UW U~L~,O3lI~ I,VSAJ*UI-U-JUJL lQL-S UI LML MI IUIU.)L SULLU S LLJ reducing the issue of over funding o' the proposed system -owever, initial .anaiilysis showvs that adjusting thab desinp arameters does not seem to have a sicn;ificant imDact on -reducineR the reressivitv of the scheme. Futher Wworkrneeds to be'done in this regard These results suggest that poLicyraker may need to caretulv, thik about tfe mlodd4ing thi.desgp ;in order to increase he efficiency and eqiy of prov-nide, aSi'ar, aua Io6 b11ji li. &- - *-|E|X C ... Ak4'. ..... W!XkW-V_S--uSUW SiWUW--U@alVUJ empirical naalysis:in rder,to.assist policmkerake ifrined decisions abothe efftives ofpolicy changes.. - v: 1 ^ ^ .. * and Excel software) and MOLSW staff have been trained on the methodology and usage of the model software. A CDP-SP technical paper which discusses the methodology of the simulation techniques and the results of the exercise will be completed early in Year 2. 125. Work is also underway towards the achievement of another Year 2 benchmark - the development of a UI pilot in the Rayong province. This pilot is expected to provide important lessons to help integrate employment services into a national UI scheme. This includes studying the capacity of DOE staff to monitor UI requirements such as work search and work availability. [n addition, the pilot will inform the coordination requirements between DOE and SSO, including data needs, program and policy consistency, and administrative and IT requirements. 126. As can be seen from above, Year 1 benchmarks related to UI have been achieved and significant progress has also been made towards the achievement of several Year 2 benchmarks (Table 9). The PIU and the Bank continues to collaborate closely with other development institutions providing UTI analytical assistance to the GOT. Other than the Bank, the main institutions are the ILO and JICA, each having work programs focusing on aspects of Ul j4 Thailand - Country Development Partnership Sorial Prtotection operational requirements. Collaboration and coordination will be important to ensure that effective UI assistance is provided. Table 9: Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Unemployment Insurance Benchmark Progress To Date Main CDP-SP Capacity Building Related to l ________________________ lI| Partners I Benchmark Formation of UI unit Benchmark achieved. ILO, JICA - TA provided on intemational experience Ongoing TA being with Ul schemes, drafting policy note. provided to strengthen the unit Identification ofprioritv issues I ienahmnrk achieved ILO TTrA I - TWAv on iriAt issues for Ul desian Anti for design and implementation -|Work |sh |mon lI design/ipipe na of Ul system. l lI okhpo ldeinipeetto Workshop on Policy Issues on Benchmark achieved ILO, JICA - Workshops/presentation on Ul design and Implementation of UI system a implementation issues with DOE and SSO. I UI simulation model BenchmarK achievea ILU, JiCA - Model developed to simulate inmanciau developed and disseminated (This is a Year 2 sustainability and distributional implications I henrchmrl.a of th.e proposed T! systnem rt set of training workshops on model dissemination completed Depsign of pilot on Benchmark being ILO, JICA - Ongoing TA on design, implementation implementation of UI scheme achieved (This is a and evaluation of pilot. Year 2 benc'nmark) National Statisticai Ofijce (vSOj) 127. Two sets of activities have been launched to improve the quality of iabor and social statistics. The first set of activities deals with the improvement of the survey instrument for the socio-economic surveys (SES). The second set of activities deals with improving NSO's capacity for data warehousing. 128. The main activities regarding modifications to the SES have included: * Reviewing the current SES methodology; * Examining key concepts, definitions and classifications used in the SES; * In consultation with key stakeholders, reviewing and suggesting modifications to the questionnaire design, methodology and sampling frame; * Developing survey modules related to issues of the demand and supply of social assistance; * nrawing uin a nlan fnr trainina/aranncitv hildAing fnr NSO staff responnsible fir dnrvep design and implementation. 129. These modifications to the SES are being incorporated in the next round of the SES by NSO. NSO is also upgrading staff capacity in order to sustain this .- -22 130. A stdAy has been cniducted to eviev 'he T .rro-quinm.en-s of NTSO .-A p:opos recommendations to improve data warehousing and data access. Some of the recommendations of uu.i Ltudy u.tiiutu w dvlovpLme11L V. oUI ar. aITa.Lt and actiLoL' painu, UIs coVnsVoUiLaion o existing infrastructure and platform; and the creation of a web version of the Statistical 22 Further assistance to NSO to upgrade the SES will also be provided through the CDP on poverty (CDP-P). The focus on this assistance will be on converting the SES into a longitudinal survey. 35 Thailand - Country Development Partnership Information Searching System. NSO has accepted the recommendations of this study and has prepared a data warehousing strategy in line with these recommendations. 131. Another priority area identified by NSO is reviewing and proposing improvements to the methodolo2v of the establishment surveYs. The aim of this activity is to establish a common sampling frame and sampling methodology among establishment surveys and incorporate questions in these surveys on areas of concern and interest to MOLSW. This study bhas been launched in May 2002 and is expected to be completed by the end of the calendar year. 132. Priority areas of action for Year 2 include developing a labor statistics network and data exchange hetween MOLSW and NSO and pilnting the pronosed data warehousing svyster 133. Prnrg.ies on CDP-SP benc.hmnarks are well on rorse, with recommendatione for design improvements in the Socioeconomic Survey already drafted. While the activity on .mprovem.ets in the establishment survey will be comple.ed in Year 2, a Yr 2- benclhmar. regarding the data warehousing/mining strategy has been achieved in Year 1 (Table 10). Table 10: Progress Towards Achievement of CDP-SP Year 1 Benchmarks: NSO Benchmark Progress To Date T Mzai 1 -DSP Capacity Building llelated Partners to Benchmark NSO Imnprovp-s de-ign of I Renchmark- achievedI I - Stndv on improvements of SES socio-economic survey. - Workshops on SES design changes NSO improves design of Study launched. - Study on improvements in establishment establishment survey. Benchmark will be survey achieved in Year 2 NSO proposes new data BenchmarK acnievea - Stuay on data dissemination, warehousing and (This is a Year 2 warehousing and mining sscoom;ntnn ctrateV hPnrhmArL- Wnrltchnn nn -tns ricePminnatinn ed _ _. I-t. warehousing and mining Occupational Safety and Health 134. The initial set of studies have focused on a management review of the current OSH svytem highlighting the strenorths and conrtrnintq faced and nronnping areaR for reform and improvement of the system. Specific recommendations have been provided on: * Establishing a clear national policy and implementation program for promoting effective OSHLI management; * Upgrading capacity of safety officers, occupational health personnel and technical service institutions im reducing OSH risks; * Creating an autonomous body for promoting and implementing OSH activities in priority sectors and SMbs; * Promoting closer collaboration between DLPW and other partners involved in the promotion and implementation of OSH (e.g. SSO, employers organizations, unions). 135. These recommendations closely coincide with emerging Government policy on OSH reform. In addition, through disseminating information on international good practices, CDP-SP has also been facilitating and supporting the work of other partners (JICA, ILO) with the Government in the areas of child labor and OSH regulations. 36 Thailand - Country Development Partnership Social Protection 136. Based on these recommendations, TORs are being developed by DLPW for capacity building activities to assist with developing indicators of OSH management and outcomes, and assessing the current OSH legislation and proposing modifications if necessary. The Government is also currently considering the creation of an autonomous organization that would assume responsibility- for the promotion. and implementation of OSH measures. CDP-SP will provide technical assistance on the viability of these reforms in Year 2. 137. CDP-SP also launched a study reviewing the workmen's compensation scheme. This study has produced recommendations on the financing aspects of the WCF scheme including implications for the extension of coverage, and methods to enhance the linkages between WCF and the OSH system. Recommendations include: * Developing a model to assess the financial viability of the workmen's compensation scheme and modifying the design parameters of the scheme on the basis of this analysis; s Reviewing the benefits paid to injured worker-./sqnrvivnrq with a view tn ensulre adequate compensation; * N4pruincr WCFP and OSIH i,nite to rreate a _trnng intti.titnn devunote to occupatina!n safety and health; in ri A_ rA tV+ Aw eX S A AS +A_F L R6A.- -- se W L IA 1 - A_L- A A1 _ S 1 1 jVI jui i;A~ L.1U15 ^ WVV s.I-9 TV .I IJ . IJWj VV IL11 LWs;VV l USlu I V VVlN1CIS, aUll4iaLUr Ui, impacts and financial sustainability of the extensions of coverage made since 1994 with a view t0waru avoidiUn LULUIV i11lplemei1iLaLlVl poIUUlqe.II 130. SSOJ ls Ul u1e pruoces VI reviwWlir,g L*ihes IlCLAJZiiiiIIiULiUiib ailU Urc.IUUig Vil priorIty lext steps. SSO is also preparing TORs for follow-up activities. These include a study on examining the financial sustainabiuity of the iunu, provision oi irauiumg on actuarial analysis, accident data statistical analysis and related IT issues, and stakeholder workshops to discuss the findings and recommendations on tne first set of studies on workmen's compensation. Tnese TORs will be submitted to the PIU shortly. 139. CDP-SP is moving towards the successful achievement of most of the Year 1 benchmarks. Many of these benchmarks have already been attained, while it is anticipated that others will be achieved over the coming few months (Table 11). Table 11: Progress Towards Achievement of CDP-SP Year 1 Benchmarks: Occupational Safe!tz and Health Benchmark | Progress To Main 1 CDP-SP Capacity Building Related Date Partners to Benchmark DLPW submits proposal on B e n c h m a r k ILO, JICA OSH Management review focusing on kOSH rliaruagernleit reLforlll to acivdUalaes eource ocatio ,cacity MOLSW constraints and programs and outputs - Review existins OSH institutional arrangements and proposing reforms. DLPW drafts three ministerial B e n c h m a r k JICA - OSH management review regulations (management, achieved - Information dissemination on confined space, radiation) international good practice [ GOT ratifies ILO conventions B e n c h m a r k ILO - Information dissemination on on worst forms of child labor achieved international good nractice OSH indicators proposed by Benchmark Study to be launched in Year 2 on DLPW achievement I developing indicators of OSH _________________________ I |delayed to Year 2. _ management and outcomes 37 Thailand - Country Development Partnership Social .Protection | Benchmark | Progress To Main CDP-SP Capacity BuildingpRelated uaie rartners to Bencnmark Workshop on Improving BenchmaIrk LO - Review of workamen's compensation Effeptivpness of WCF: arhipved (Thki is a Institutional and Incentive Issues | Year 2 benchmark) | Overall Assessment of Progress and Next Stens 140= The progress towards achievement of henchmarks is impnressive and ahed of sehpdule in some respects. The PIU has continued to play a vital role in implementation and monitoring nrnogrpe of CDP-SRP Thp vnrioiis onmrnonennt tfpmce have take-n a k-epn int.rjet in the afriumjrnt and the technical assistance activities that have been launched. Year 1 benchmarks will be AchiipePl fn%r Almnct All artiuvtfoc Ain A fp _ no ifinat "r^renr has ale I1 -'A - bee M.A. _,s, ed b_ .v. ._1 __act.t, -.dv -s as -_ _V_ V ^^^Ss JV _VV ... -ss F-5.. u} --W *sv towards the achievement of Year 2 benchmarks. The component teams are also in the process of develoinng icsue nonpam wvhih -wil focus nn t+h. .-nA.- initiat;.ves a ....A. ' er. -1-5flA - - .J. ~ Vl**''O~Jl & Aifl-J*- nn.t.an V -. - CfLf& '. U LJ 11 U~JlU1' LU %4F1tU rL'L discuss areas in which CDP-SP can provide further assistance, and develop workplans for Year 2 ofChDPSD . .iese issue papers "xil, be completed by August 2v0. t4 . _1 _LJA A_+_A_i _ AtLU A JA _Afl0 *00U jAp.4 UU A t4J_ _ _ _ _ _U_ _ _ _ It4l. Fl UrLerllmwo, givenl tLh asiniJLfLcanLt ILatUre Vo LrecomLmend1LUatVions UthLt are Ueing prUpUosU through many of the studies, the PIU has proposed the preparation of a number of products for dissemrilatiA6on. IV.-e clude1UU F1lagship rPIulUcItios, Policy Notes, and Technical Papers. Flagship products will include the risk and vulnerability study and the Year 2 launch document, cornposed of Ule revisCed dUeVe1Up1menL poiIcy matrix, uonor coordination matrix, and reform decisions and planning documents for each component. Policy notes, the second category of CDP-SP publications, wili also be prepared and disseminated in Year 2, including in the areas of social assistance and unemployment insurance. Technical papers, the third category of CDP-SP publications, will be issued in Year 2 on the various components, including the Ui simulation methodology and results of the simulation exercise. 142. A formal Year I review workshop is scheduled to be held in September 2002 to present the progress on various planned activities for the first year of the partnership - focusing on whether specific benchmarks and monitorable targets have been achieved. The workshop will help inform decisions by the World Bank and the Thai Government on continuation of the CDP- SP into its second year. Another key factor will be the availability of grant financing for the continued technical assistance and capacity building under CDP-SP. If the partnership is renewed for Year 2, any necessary adjustments will be made to the focus of remaining activities at this time, and the framework, development policy matrix, and capacity building activities will be accordingly adjusted. The formal launch for Year 2 will then take place in October/November 2002. 38 Thailand - Country Development Partnership Social Protection - r, fla _t j .'U .,- r. n f4 J |.. * Socia! Acvishanr'p * Employment Services * Unernlploymrent 'Insu-1-anCV ('t) * National Statistical Office (NSO) * Occupational Safety and Heaith (OSn) 39 Thailand - Country Development Partnership 5'ocial Protection Thailand Counitry ]Development 'Partniership-S,ocia]l Protection DevelOpDent PoiCy ]Matrix Objectives/Outcomes -_' Benchmarks C )acity Buailding - aiad Trainiing = - < Year Y Year2 7 Year C I SocuiaAssistance Issue: Lack of resources and capacity to effectivel manape social assistance iro gans Objective: Coping with risk of poverty by inp roving the efficiency of social welfare delivezy: - Institutional &k nmanagement reform - Operational reform (i) Institutional & - DPW develops - DPW proposes - The cabinet approves - Review social assistance programs in terms of institutional Management Reform: guidelines for roles revisions to Social New Social Welfare setup,, budgets, target group, service standards, outputs and costs. Improve the managemnent and responsibilities for Welfitre regulations Service Bill Make recommendations for roles and responsibilities. and effectiveness DPWV - Structure of new. - Implementation of - Review proposed Social Welfare Bill and provisions for (coverage and benefit - Ccnduct regionail Ministry ancl role of training program for private-public partnierships (including civil society) adequacy) of decentralized national workshops on DPW finalized DPW and decentralized - Review capacity for enfiorcing, monitoring and managing social and dermand-iven social "Efficiency and - Development of structures welfare regulations/laws and develop training programs. assistan,ce program Coverage Issues with training program in - Develop training program and manual on pollicy and M+E delivery SA IErograns" policy/M+E issues _ related issues. (ii) Operational Reform: - DPW develops - DPV proposes - Develop a training - Risk: and vulnerability assessment to identifyr vulnerable groups Improve: targeting, guidelines on draft programmatic-level program for local and propose reforms to improve coverage and targeting. coverage, equity and indicators, imanualls for reforrns based on risk adminiistrators to build Basel on intemational experience and current capacity, design efficiency of cash tranisfer monitoring, and assessment amd builds capacity and awareness. core set of inidicators and manuals by which programs can be programs aimed at low- minimal common capacity on IRA. - DPW launches and monitored periodically through surveys and acdministrative inicome families through standards for cashlin- - Launch Workshop on evaluates pilot program records. Also develop criteria for comrnon standards for each of decentralization and broad kind transfe:r programs "Coverage and on operational reform. the programi delivered. stakeholder partnership. - Conduct Targeting of' Social - Launch pilot to - Evaluate how to enhance the cepacity of village welfare centers, regional/national Assistance Programs" evaluate M+E system develop financial plans for administration of village welfare workshops on centers, local Governments and CSOs to manage and monitor "Challenges of decentalized delivery of social assistance. Decentralizing Social - Studly on intemational good practice on innovative financing Assistance' mech;anisms to increase coverage of cash transfer prcigrams. - Develop arnd implement proposal on tbaining/capaciity building for imriproved service delivery by public and private providers at L _ __.__ i the village level 40 T7hailand- Country Development Partnership Social .Protection ObjectivesiOutcomes Benchmarks _ Capacity Buildig and Trainiing - - . -- _ bYear l~~~Year er Iea r ar3 =t_ LL Employsent Services Issue: Limited success in meeting the neods of job-seekers mainly due to coIven Mand capacity constraints. (a) Objective: Reducing -Decision on location - LMI Office produces - Development: of - Study on inventory of various LNII data collected by public ( e.g. the rtsk of unempk1eyment of focal point for labor regular policy-relevant prototype of LMIS MOLSW, NSO etc.) and private stakeholders. for workers through: market analysis reports on LMI system - Engagement of a labor market specialist to help LMI Office Improving the relevance, -Staff trained in area of - Capacity building produce LMI report and train staff in the area of labor market timeliness, analysis and labor market analysis program for LMW staff analysis, including first round of short courses and study tours. adequacy of Labor Market - Consultant recruited completed - Study on intemational good practice with making LMIS relevant Inforniation (LMI) for to assist in preparing - Launch Worlshop on for policy and program design and employment ;planninig unde-r employment policy and LMI report "Enhancing the regular and crisis situations planning - LMI office produces Relevance of LMIS for - Develop and implernent Pilot program for better dissemination/ one policy report Thailandi" utilization of LMIS (including IT) in selected provinces (b) C)bjective: Reducing - DOE drafts new risk ofunemiployment: policy on emplloyment - institutioznal and services management refonns - program Ilevel reforms __ _ _ __. ___ _ ___ _ _____ (i) Institutional and - Workshop on "ES for - Training program for - Review of the existing institutional setup, expenditure/financing management refonras: T hailanid: Institutional technical and review, exploring potential linkages with other agencies (e.g. 'Min. Better integration of and Pol:icy Issues" management staff 6f Industry, NE1SDB etc.) and service providers (e.g private service existing and potential - Draft r evised implemented providers) for local and overseas workers service provision rnegulatiions governing - Implement pilot - Implement tmaining/capacily buildling pn:gram for teclnical and job placement services programs on management staff of private providers. institutional reforns - Study on role of private providers and gufidelines to encourage _pnivate Iprovision of employnent services. (ii) Programrk-level reform: Workshop on - DOE develops - DOE publishes - Study (and develop proposals and guidelines) exploring local and Ensure ES programrs "International indicators on M+E annual MA&E report for intemational "good practice" on public and private job placemtent (placement, career Experience on Job - Workshop on each emnployment prograrm design, regulation, deliveiy and implementation. counseling) are demand- Placement Design and "Monitoring and service prograrn. - Evaluation of current services (jolb fair, placement, counseling, driven and cost-effective Implementation" Evaluation of - Developmenl; vocational guidance etc.), for local and overseas ES, including level Employment Services" implementation and of delivery (urlban, provincial) and role of IT. evaluation of pilot - Beneficiary assessment of job seekers, workers, employers and program. institutions on ES targeting efficiency, coverage and cost- effectiveness. _________________ -_Study to develop guidelines on M+E of employment services 41 Thailand - Country Development Partner.hip Social Protection Olbjecties/Outconies .C==a_ Baenchmarks Capacity Building and Trainixu _ - _nsurance _U) -' Issue: Year I Year 2 =[ - Year 3 3 M. Une-mploympnent Issue:Thailand is in the pnocess cf imple-mentinig a U][ systern. Insurance (ED _ __ Objective: - Royal Decn-e on IJI Mitigating the risk of unemployvment through designing an effective and financially viable unLemployment insurarkce scheme ____ _ _ _ _ (i) Policy Level Refonn: - Formation of a UI unit - MOLSW drafts - Ul systerm operaticinal Based on intemational good practice, review relationship develop e ffective LM within MOLSW guidelines on relevant - Guidielines on labo,r between the UIS arid areas defined by other labor legislation, policies are in place prior - Identification of labor legislation legislaion particularly tie provisions for severance pay and hirng and fring to implenentation of the priority issues related to - MOLSW drafts implemnented., regulationsd scheme. the design and strategy for interaction - Ul implementation - Study on priority issues facing the introduction of a LI system implementation of a eI of Ul with other labor plan finalized - Based on miternational good practice, explore strategies to be system. l market programs. developed (e.g. active labor market programs) to assist people - WorIshop en "Policy who become unemployed Implementatio - Development of a UI implementation plan ImpleinnentatboDn of tnI" - Training (study tour) on international tJI systems (ii) Financial re.form: - Ul simulation model - Paraneters ,goveming - Based on intemational good practice and the Thai situation, ensure that the fund developed implementation of [JI develop methodologies for assessing thie financial flows of the remains financially - Capacity building finalized (e.g. rate of system to assess the longer-temi viability of the system inder sustainabtle program of MOLSVI in contribution, wage different ecornomic scenarios. financial management replacement rate, length - Develop a proposal for capacity building and traininlg of staff in -developd of entitlements) financial management of the Ul system. (iii) Operational reformn: - Develop pilot program - IT and capacity - Implement pilot program to test Ul implementation process and ensure that adeqtuate to test Ul building program outconies. capacity is in place to implementation process implemented - Develop a strategy and consequent specifications for the mamage the system and outcomes - Evaluation of Ul pilot information technology requirements of the UlS for both SSO - Capacity building iin with outcomes feedback and DOE. pilot areas in program to improve design o1 - Develop a proposal for capacity building and training of staff in L.. -__ _____________- [ |design Ul system SSO ad DOE to deal with introduction of Ul. - 42 Thailand - Countrv Developmtent Partnership Social Protection objectives/Outcomes = _= = =_]Benchmarks = = = = | = Ca ity Building an ITrainijg = = _V. _ _ - Iss Ye: do no YeaLr 2 Year 3 - IV. Nvional .9tatistcal Issue: Survey instmuments do not fully responcl to the needs of the end-users (e.g. DPW, DOE). The weak capacity of NSO to process and release tce SO) _ _ timely data ibter exacerbates dlprblem. Objective: Enhance relevance ofd2ta through: (i) imriproving survey instruments; and (ii) improving dissemination stegy - (i) Survey Design: - NSO improves design - NSO implements new - NSC) implements - Based on international good prctice, review and make Enhance quality of socio- of soc io-economic socio--economic survey. establishment survey. recommendations on adeq[uacy, limeliness, and analysis of data economic, labor force and survey. and seope for streamlining, establlishment surveys. establishment surveys - NSO improves design - Based on international good practice, review and make of establishrnent recommendations on adequacy, timeliness, and analysis of data s-_ eys and scope for streamlinin,jhocio-economic surveys. (ii) Data Dissemination: NSO designs and - NSC) staff trained in - Based on international good practice, review and make develop timely and user- implements improved data analysis, recommendations on data processing, sitorage and warehousing of -friendly disseDnination dissemination strategy warehousing, and all major NSO surveys. practices - especially as for all surveys. dissemination. - Develop a proposal for capacity building and traiining of staff in they relate to I)OE and - NSC) proposes new - NSC) proposes new data collection, processing and dissemination. DPW. data warehouasing and data wvarehousing and dissemination strategy dissernination strategy _ - - for LFS survey. for all surveys. 43 Thailand - Country Development Partnership Social Protection ObjectiVes/'Outcomes = = = Bendumarks, __ Ca pacity Building and Training J-- Year m mL Yerir 2 - Year_ 3 _ - V. OccupathmnalSafety Issue: Low coverage and capacity of D)PLW and otiher stalkeholders to administer beater OSH standlards compliance (especially in MSMEs) and and Health (OSHJ limited take- arnd coverage of workmen's compensation schemes. I (a) Objective: Reduicing _ - DLPW drafts national OSH accidents at the policy on OSH with workplace: new regulations and - improving management standards - develloping information - reforming regulatio[ns _ (i) Improving OSH - DLPW submits - Launch Workshop on - - DLPW designs and - OSH managemerit and institutional review fbcusing on management systemrs and proposal on OSH "OS]H Management implements pilot mandates, resource allocation, capacity constraints and institutional framework management reform to and Institutional Issues prograim for extencling programs and outputs (both within and outside DLP'W) MOLSW by Year 1. in Thailand" coverage - An assessment of OSH concerns in the informal sector (e.g. - DLPW submits - Redluce number of home based workers) and the adequacy of existing coverage. proposal on new OSH accidents/1(00 workers - Develop and evaluate coverage, targeting efficiency, cost- autonomous: institution by 20% in pilot areas. effectiveness of pilot program in targeted industries and areas structlure - Implemenit - Review of technical knowledgez and implementation capacity autonomous; structuire identifying traininlg needs for imiproving OSH - Train 50% of labor - Studly and international good practice on the development of -_- - - - -. ispectors. an autonomous institution to manage CISH (ii) Develop better OSH - OSH indicators - OSH information - Assessment of cutrrent OSH information systems anid information systens: proposed in Year I system prototype recomnmending steps for improvement and proposinig, prototype. proposed and - Develop a directory of MSMEs (explore possibility of ______________ . ________- _________. implementedi collalboration with Office of MSME promotion). (iii) Reform OSH - DLPW drafts three - Workshop on - DL]PW drafts 11 - Studly of Iegislative reform based on international experience legislation and mandates OSFI regulations "Legislative Reform of ministerial regulations in onrer to promote partnerships between OSH stakeholders. - GOT ratifies ILO OSH In Thailand" on OSH and OSH and - Design and implement an awar-eness lprogrun which infosms conrention on worst - Develop training Working Environment stakeholder. about the hazards of child labor at the workplaLce. fomis of child labor prog-am on regulations Act. (b) Objective: Mitigating - Launch Workshop on - Implement training to - Review of intemrational and Thai experience (including workers' injuries risk "Effectiveness of increase awareness on program design, financing, rates of contribution) in INC. through improving Workamen's Comp." extension of coverage - Study on the feasibility of extending coverage of workman's compensation, coverage - Develop gaidelines on - 25%4 of workers in compensation to private sector enterprises wilh <10 workers of proram !Fr worker PvtPndng coverag" for enterprises with. 0 - Develop and implern__,t _a-,_aci.jt, _uilding p.rog.m to r_ise affected by OSH. _ -ims -with <-10 workers workers covered. awareness on guidelines on expinsion of compensation gram 44 Thailand - Country Development Partnership Social Protection 45 Thailanal - Country Development Partnership Social Protection Thailand Country Development Partnership -, Social Plrotiection Donor Co-financing Maltrix (Year 1) Areas of Assistance Total Wo]rld ILO UNICEF GTZ JICA* AUSAID KENAN Bank 1. Occupational Safety and Health 1,066,000 _165,001 261000 _6000 _0_ _ - _ 4000 2. plyment Services 720,000 120,000 500,000 _ 0 0 _ 100,000 3. Unemployment Insu ance _ 222,000 150,000 72,000 - - -_ __ 4. Social Assistance __620,00 __120,000 __ _. _ _ __ 51DO 5. NSO I__11000 _ 11Cl,000 __ _. ___ _ _ ___ Project Management 50 000 50 -000 Total 2,788,00 71,000 333,000 - 6000 500,000 = = 600,00D 40,000 Total Currently Available 2,753,000 680,000 333,000 600,000 500,000 _ -. _ 40000 Fundirg Gap 35,000 35,000 '0 0 0 ° _ 0 0 * JICA provides techmical expertise in the areas of Occupational Safety and Health, Eimploymnent Services and Unemployment Insurance. The exact amnount of financial assistance provided is unavailable and has not been entered in this table. 46 Thailand - Country Development Partnership Social Protection Thailandl Country Development Partnership -- Social Protection Partnership Matrix (Year 1) Tasks Estimated Cosit Fund Sotirce WB/P--D External .______________________________________________________________ Partners CI)P-SP Mantagement Pro]ject Advisor 30,000 PHRD Overall Policy Workshop =20,000 Subtotal :50,000 0 NOOm m -ruMmmmi NMm m WIN OSH Management review focusing on manidates, resource allocation,, capacity corstraints and :35,000 PHRD programs and outputs Assessment of current OSH informalion systems and reoDmmernding steps for improivemernt and 20,000 ASEM proposing a prototype Re view existing OSH institutional anrangeiments and propose measures for reforms (including :20,000 ASEM expanding services to MSMEs). Based on a critical review of legislation concerning C)SH in Thailand, propose appropriate 25,000 PHRD legislative reform based on lessons from internatiolal experience in order to promote partnerships betwveen OSH stakeholders. Review of inteniational experience (inclucing alternative program design, financing, rates of 25,000 PHRD contribution and role of IT oplions) in provision of compensation for workers (and employers). __ _ Capacity building activities to infomi stakeholders (including ernployers) about child labor 600,000 UNICE]F SI4POC rapid assessmrent of child domestic workers 20,000 I1,0-IPEC Women's workers movement: to combat child labor exploitation in the formal and infiDrmal 63,000 IL.O-IPEC sector in Bangk k and satellite areas (National Coigress of Thai Laboi (NCTL)) __ . Upgrading job skills and promotion of occupational Health among children in fishing and 66,000 lIO-lPEC fanning Communities in the south of Thailamnd (Planned Parenthood Association under the Royal Patronage of HRH the P'rincess MotbhDer (PPAT)). __ 47 Thailand - County Development Partnership Social Protection Tasks - Estimated Cost Fund Source WB/PHERD External _ Partners I Promnoting occupational safety and health fior children working in faumily fruit orchards and 82,000 ILO-IPEC plantation and prevnting children from prostitutiorl and drug trafficldn 3a in Phayao Sub-regional project to combat child labor in. the footwear sector: Thailand componenit 30,000 ILO-IPEC A study on child labor which provides an update on the nature and extent of the problem based 25,000 PHRD on recent survey data and new classifications of child labtor. I)evelop a proposal for implementing and monitoring programs for elimination of child labor. Workshops on OSH 15,000 __HRD Labor Standards Trainitg Programs and Conference: support the development of a specialized 40,000 KENAN conference focusing on the emergence of codes of conduct of labor standards in the manufacturing sector. _____ _ Strenrigthening of the National Institute for the Improvement of Working Conditions and JICA Environment (NICE)._ _ __ _ Subtotal 165,000 901,000 Compile inventory of LMI data collected by public and private agencies 20000 E'HRD Engagement of a labor market specialist to help LNII Office produce LMI report and design and 40,000 E'HRD impl[ement training program for staff iin the area of labor mnarket analysis, including study tours Study exploring local and international "good practice" on public and private job placement 25,000 E'HRD program design, regulation, delivery.. Using a new survey, estimate the pub]lic/public share ofjob placement in the market. 20,000 _PHRD Training olf officials in labor market analysis 100,)000 AUSAID Vocational guidance and employment services TA 500,000 GTZ Workshops on Ernployment Services 15,000 - PHRD _ Guiiance on a total employmernt information system _ _ JICA Guidance on the Comprehensive Employment Policy (CEP) and the relevant labor JICA administration _ I I_I _ I 48 Thailand - Country Development Partnership Social Protection Tasks Estimated Cost Fund Source WB/PHRD External Partners Subtotal 1.20,00(W 600,000 Based on international Igood practice, review relationship between the UIS and areas defined by 40,000 ASEM other labor legi slation, partic ularly the provisions for severance pay and hiringr and firing regalations ____._ Develop mnethodologies for assessing the financial flows of the system to assess the longer-term :25,000 ASEM vialbility of the system tnder different economic scenarios. Develop capacity to assess financial viability of U]: systern 72,000m Assess strategies/capacity building plans to be adolpted to handle the increased operations at 40,000 ASEM SSO and D)OE. Develop a strategy and consequent specifications fbr the information technology requirements :30,000 PHRD for SSO and DO]E Workshops on Unemployment Insurance 15,000 PHRD Guidance to the IDOE with the introduction of the unemployment imsurance scheme JICA Subtotal 150,000 72,000 Review social assistance programs in terms of institutional setup, budpgets, target group, service 25,000 ASEM standards, outputs and costs. Estimate the coverage gap fcir cash-transfzr programs using existing surveys and administrative data. Evaluate and provide recommendations on how to enhance the capacity of village welfare 30,000 ASEM centers, develop financial plans for administration of village welfare centers, local Governments and CSOs to manage and monitor decentralized delivery of assistance. Based on international e xperience and current capaucity, design core set of indicators and 25,000 . ASEM manuals by which programs can be monitored periodically through surveys and adrministraltive records. Also develop criteria for comrnon standards for each or the programs. 49 Thailand'- Country Development Partnership Social Protection Tasks Estirnated Cost Fund Source WB/PEIRD External _ _ _ ~~~~~~~~~~ ~~~~~~~~~~~~~Partblers _ Conduct a series of regional and national workshops to discuss the findiings of the abave studies 25000 ASEM and draft proposals for irnproving the efficiency of cash and in-kind transfer programs Capacity building; for civil.servants to enhance the development of social protection policies 500,000 AUSAID (regional program in Indlonesia, Thailand, Philippines, Vietnam aLnd possibly China, Laos and Cambodia, A$5 million). __ Guidance in the areas of social and lalbor welfare JICA Workshops on Social Assistance 15,000 HRD_- Subtotal 120,000 500,000 Based on international good practice, review and make recommendations on adequacy, 30,000 I'HRD timeliness, analysis, relevance and dissemination of datai and scope ifor streamlining existing establishment surveys _,_ __ _ _ Based on international good practice, review and make recommendations on adequacy, 30,000 I'HRD timeliness, analysis, relevance and dissemination of data and scope for stream]lining existing data collection in the socio-economic surveys. Based on international good practice, review and make recommendations on data pro cessing, 35,000 _ PHRD stonrge and warehousing of all major NSO sarveys.. Develop a proposal for carpacity building and traininjg of staiff in data collection., processing and disseminalion. Data Workshops -15,000 _ -?PHRD Subtotal- 110,000 0 TOTrAL FUNDING FOR PRIORITY STIJDIES 715.000= 2,073,001_ 50 IMAGING Report No.: 24378 TH Type: SR