CHAPTER FIVE:

Social Security and Subsidy Programs

 

ARTICLE 36-  In realization of Article (29) of the Constitution and promotion of social justice, social security is considered as a human right aimed at protecting various classes of the society against economic, social and natural calamities and their consequences from the standpoint of retirement, unemployment, aging, disability, orphanage, homelessness, accidents; physical, mental and psychological retardation; and the need for health and medical care via insurance and other means (direct protection and relief).  Government is required, in compliance with prevailing laws, to provide the above-mentioned services and financial support to every citizen of the country out of public funds and through the revenue derived from people’s financial participation.

ARTICLE 37- Insurance activities shall be performed in two categories of general and supplementary.  Obligations and services of each category are determined on the basis of the following criteria:

A- General insurance services that are financed via participation of the insured, employer(where applicable), and government (according to its lawful mandates) including medical, retirement, disablement, survivors, and unemployment insurance shall cover all the eligible individuals. The coverage of these services will be determined proportionately by the insurance premium received, financial ability of the insuring agencies and the extent of he subsidy that will be decided and approved by the Cabinet.

Note:  Services provided under the existing laws of the insuring agencies and the pension funds for all insured persons covered by those agencies and funds shall be counted as the general insurance services.

B- The supplementary portion of social insurance includes provision of higher level services as compared to the general insurance, or provision of new services at a higher cost . This category of insurance services shall be provided through contractual agreement between the insured and the insurer, and its cost shall be borne by the insured.

C- The entire financing of the cost of the general and supplementary insurance and special medical care of the War veterans (related to the war inflicted injuries) shall be the responsibility of the government.

D- the Law Enforcement Forces are required to:

   1- Utilize supplementary insurance in order to meet the medical care needs of their personnel.

   2- Take the necessary measures to provide mission-specific insurance for their operation personnel.

ARTICLE 38- In  addition to the special services provided in the context of employment, housing and educational programs, provision for non-insurance protections consisting of preventive health care and rehabilitation shall constitute the following cases:

1- Protecting all individuals against social hazards, physical and mental disabilities.

2- Financing the per capita cost of medical care insurance premiums within the framework of general insurance provisions.

3- Provision of facilities for individuals in need of support and guardianship and preparing the ground for their rehabilitation and self-reliance.

4- Payment of annuity and disability benefits to the eligible individuals.

Note:  All the needy persons unable to maintain a living and unable to work shall be eligible for receiving supportive services provided by the Imam Khomeini Relief Committee, based on the criteria approved by government and the Islamic Consultative Assembly.

ARTICLE 39- The following actions shall be taken in order to enhance the level of services provided to the insured,  and at the same time to prevent any financial crisis in the insurance organizations, and to strengthen their financial position:

A- Government, in addition to paying off its annual obligations to the insurance agencies and avoiding new liability, is required to settle fifty percent (50%) of its outstanding debt to the said organizations through mutual consent, as well as divestiture of the government shares of the state-owned enterprises, selling off public properties and assets, including selected incomplete projects.

B- Should the rate of increase of the workers’ wages for the last two years of tenure as reported by the employers, be more than the normal rate of growth of the wages, and the reported increase is not due to the job promotion, the Social Security Organization shall  charge the employer the combined contributions of the employer and worker according to the difference of the reported wage and the actual wage for the previous years. The by-law pertaining to the losses incurred by the Organization shall be jointly prepared by the Ministries of “Labor and Social Affairs”, “Health, Medicare and Medical Education”, and approved by the Cabinet.

C- During the Third Plan period,  Note 3 under Section 3 of the  Social Security Law enacted by the Islamic Consultative Assembly on 19/10/1997 shall be amended as follow:

   1- In the case of death of an insured person with a record of ten to twenty years of payment of insurance premium, the survivors shall be entitled to receive a life pension based on the number of years of payment of the premium, and irrespective of the limitations specified in the Article (11) of the Social Security Law as well as the shares stipulated in Article (83) of the same law.

   2- Should an insured with a record of payment of premium from one to ten years dies after the inception of this law, the survivors shall be entitled to receive a one-time fixed severance equal to one month of minimum wage of an unskilled labor per each year of paying the premium and proportionate to the share stipulated in Article (83) of the Social Security Law.

ARTICLE 40- In order to execute the mandates of this Chapter, an appropriate organizational structure for the social security system shall be drawn up jointly by the Plan and Budget Organization and the State Administrative and Employment Affairs Organization with due consideration of the following principles, and shall be submitted to the Islamic Consultative Assembly for enacting:

A- Abatement of overlapping functions of the existing agencies and elimination or integration of parallel entities, as the case may require.

B- Provision of a comprehensive social insurance system to cover the entire population.

C- Enhancing efficiency and effectiveness of the relevant agencies, and reducing administrative and supportive costs of the whole system of the social security.

D- Provision of a mechanism necessary for establishing coordination among relevant agencies and unifying policy-making at the highest executive decision-making level.

E- Effective utilization of the resources of charity organizations , people’s contributions, and Endowments (Vaqf), and also those of the urban and rural Islamic councils and religious centers.

F- Full utilization of existing agencies, and abstention from creating  new agencies.

ARTICLE 41-In order to increase the return on investments and to reduce the current expenditures, the insurance agencies are obliged to take the following actions:

A- New investments by insurance agencies shall have technical and economical justification and bear a desirable return.   In the case of unsatisfactory return, the agencies are obliged to either undertake to improve the structure of the investment or to divest the assets content of this Item.

B- The extent of employment posts and manpower of the insurance agencies and the administrative and overhead expenditures shall be determined on the basis of the criteria and in proportion to the insured persons and their respective distribution.  These criteria shall be approved by the Cabinet.

ARTICLE 42- All the insured persons (except personnel of the Armed Forces and  Ministry of Intelligence) may change the insurer agency.  Transfer of insurance premium and insurance deductions among the insurance funds shall be made on the basis of the criteria to be prepared within a maximum period of six months by the State Administrative and Employment Affairs Organization, Ministry of Health, Medicare and Medical Education, on the proper actuarial basis, and shall be approved by the Cabinet.

ARTICLE 43-In order to improve the arrangement and the provision of  the services to the War veterans ( the honored families of the war martyrs, missing devotees, prisoners of the war, liberated ex-prisoners of the war, and disabled combatants) a comprehensive plan for provision of the services including a system of payment of life pension and salary to the War veterans shall be drawn up by the Plan and Budget Organization, the State Administrative and Employment Affairs Organization and the related institutions, and shall be implemented upon approval of the Cabinet, using internal resources of the institutions and the related entities and the general budget.

Note 1- To improve the arrangement and the provision of services to the deprived and vulnerable,  and reorganize delivery of the services in an integrated manner, all the supportive services to the deprived and vulnerable shall be provided by the Imam Khomeini Relief Committee, whereas all the rehabilitation services to the disabled shall be provided by the Welfare Organization.

Note 2- Application of the provisions of this Article to the institutions under the auspices of the Supreme Leader will require  his confirmation.

ARTICLE 44- In order to prevent and alleviate impacts of the natural disasters, to create necessary public preparedness, to determine the proper role and mandates of the executive bodies to withstand, and counteract to, natural events and disasters, the Red Crescent Society of the Islamic Republic of Iran is required to prepare a comprehensive relief and rescue plan in collaboration with Ministry of the Interior, Resistance Mobilization Forces, and in cooperation with other relevant agencies during the first year of the Plan and have it approved by the Cabinet.  This plan shall include:

Crisis management, training and public preparedness, manner of participation of the executive agencies, the role of the Islamic Republic of Iran Broadcasting Organization, the mass media operational activities, financial and procurement resources , etc.

Note: The Bassij Resistance Forces shall henceforth be appointed as a member of the State Corps of Unexpected Events.

ARTICLE 45- All commercial insurance companies are authorized to offer general and supplementary social insurance services.

ARTICLE 46-

A- The subsidy program implemented within the Second Plan period for the primary goods consisting of the number of coupons, quantities and prices of wheat, rice, vegetable oil, sugar, cheese, medicine and dry milk, shall be continued during the Third Plan.

Government is required to include in the annual budget, in form of local currency, the per capita subsidy payments for the primary goods as implemented in the Second Plan.

B- The Organization for Protection of the Producers and the Consumers is charged with establishing differentials of the imported goods that have considerable advantages, as declared by Ministry of Commerce and upon necessary computation, and transfer the accrued revenue to the Treasury. Government may , upon proposal by the Ministry of Commerce and approval of the Economic Council, utilize one hundred percent (100%)  of the collected hold back pays to finance the subsidy payment for goods and services that require public subsidy.

ARTICLE 47- Subsidies of the agricultural input such as fertilizer, pesticides, and seeds, will continue to be paid. Government is required to determine the guaranteed prices of the primary commodities in a manner that by the end of the Third Plan the guaranteed purchase prices equal the cost of importing the same commodities.