The Department is responsible for the administration of Social Security legislation which provides for the payment of benefits under contributory and non-contributory schemes.
The entire population is in some way recipient of such benefits, and the Department is mainly involved in ensuring that financial support is given to those sections of the community who are mostly in need, namely the poor, the sick, the elderly and the unemployed.
The continuous rise in Social Security rates was further sustained by Act XXVI of 1995 which brought about various amendments to the Social Security Act (Cap. 318), and paved the way for total expenditure on Social Security in 1995 to exceed Lm123 million. This rising trend was not only restricted to expenditure levels, but also reflected in the ever-increasing number of claims for benefits submitted throughout 1995.
A. LEGISLATION
1. The Amending Act of 1995 mainly provided for the increases in the rates of Social Security benefits and contributions as had previously been announced in the Budget Speech for 1995. Although the substantial part of these increases were proportionately tied to the Lm2.25 general rise in wages awarded by Government, other additional or innovatory measures were also introduced. These measures included:-
Contributions and Enforcement
2. The total revenue collected during 1995 in terms of the Social Security Act, (Cap. 318) amounted to Lm110,788,366 vis-a-vis the Lm101,769,865 in respect of the previous year. These figures were broadly broken down as follows:
Type of Contributions |
|
|
|
Class I Contributions
in respect of Private Industry
Class I Contributions in respect of Government Employees Class II Contributions by Self-Employed persons Further Contributions (penalties) in terms of Sec. 116 of the Act State Contribution |
40,208,797
20,365,453
7,151,751
180,864
33,863,000
|
45,058,985
21,111,878
7,444,657
365,086
36,807,760
|
+ 4,850,188
+ 746,425
+ 292,906
+ 184,222
+ 2,944,760
|
|
101,769,865
|
110,788,366
|
+9,018,501
|
3. The Enforcement Section was, as in previous years, actively involved in putting into effect the various provisions of the Social Security Act since quite an appreciable number of those liable to pay contributions, viz: employers and self-employed, fell in arrears.
4. During the same period a total of 1129 self-employed persons were issued, following application, with Permits enabling them to pay the Class Two contribution at one of the lower rates. Another 1390 applicants had their permit changed from one category to another and a further 1719 applicants updated their existing permit. Moreover, a total of 977 persons applied for a Certificate of Low Income (exemption from the payment of contributions). All applications were accepted and the relevant Certificates issued except in the case of 15 applications which were rejected.
5. A total of 1011 applications for "Deeming" of Class One Contributions were received by this Section, of which 891 were dealt with and 228 are still pending, awaiting further investigations. These are requests to the Director to deem as paid any contributions deducted by the employer from the employee's wage but not remitted to the Commissioner of Inland Revenue to whom all Social Security contributions are paid.
6. During 1995, a total of 3020 requests for payments of arrears of contributions were received from insured persons. Relative bills (contributions and further contribution - Section 116) were issued to 2881 applicants and 104 requests were rejected on legal grounds.
7. During the year the Department initiated judicial action against 481 defaulters who persisted in refusing to pay Social Security Contributions due on behalf of their employees, or to reach an agreement with the Department to pay arrears over a period of months. The office of the Attorney General was requested to serve warrants against 160 of these defaulters. Furthermore another 36 defaulters reached agreement with the department to pay all outstanding contributions over a prescribed period. The amounts of Lml,299,068 as Social Security Contributions in respect of the periods in default and Lml13,794 as Further Contribution on late payments were collected.
Short-Term Benefits
8. Claims for short-term benefits dealt with
during 1995, as compared with 1994, were as shown immediately hereunder:
|
|
|
|
Sickness Benefit
Unemployment Benefit Special Unemployment Benefit Injury Benefit Marriage Grant Gratuity on Re-marriage |
144,050
7,618
830
7,157
3,751
16
|
145,263
7,873
705
6,991
3,932
4
|
+ 1,213
+ 255
- 125
- 166
+ 181
- 12
|
|
163,422
|
164,768
|
+ 1,346
|
Type of Medical Certificate |
|
|
|
First/Final (less than 4 days)
First/Final (from 4 to 6 days) First (open) Intermediate Final |
82,725
41,921
16,404
66,577
12,343
|
81,843
47,030
16,390
80,893
13,160
|
- 882
+5,109
- 14
+ 14,316
+817
|
|
219,970
|
239,316
|
+ 19,346
|
10. During 1995, there were 6,991 reported accidents at the insured person's place of work. On the other hand, 6 workers contracted an industrial disease.
11. Ten employees died as a result of an accident at work.
12. 185 Disablement Gratuities and 25 Disablement Pensions were awarded to those who, as a result of an industrial injury, sustained a permanent disablement.
Children's Allowances and other Family Benefits
13. During 1995 the Department received a total of 7,437 claims for Children's Allowances as against 8,268 received in 1994. 2,321 applications followed the birth of a first child and 5,116 applications followed the birth of a second or subsequent child or a claim for 'Special Allowance' (students over 16 years of age). Of these 30 claims were rejected on legal grounds.
14. On the 31st December, 1995 there were 52,440 households in receipt of Children's Allowances, compared to the 52,731 households on 31st December, 1994. The table immediately hereunder shows the load in payment, by types of Allowance, at the end of 1995 as compared to 1994.
|
|||
|
|
|
|
(a) Child Allowance only:
(ii) Two eligible children (iii) Three eligible children (iv) Four or more eligible children (c) Child Allowance plus Special Allowance |
22,553
19,785
5,898
1,997
1,046
1,452
|
22,598
19,669
5,794
1,979
1,177
1,495
|
+ 45
- 116
- 104
- 18
+ 131
+ 43
|
|
52,731
|
52,712
|
- 19
|
15. The table immediately herudner shows the number of mothers in receipt of Parental Allowance and the number of households in receipt of a Handicapped Child Allowance and the Family Bonus as at the end of 1995 and 1994. It also compares the number of accepted claims in respect of Maternity Benefit as at the end of the two aforementioned years.
|
|
|
|
Parental Allowance
Disabled Child Allowance Family Bonus Maternity Benefit |
9,418
593
53,342
4,590
|
7,995
604
53,088
4,458
|
- 1,423
+ 11
- 254
- 132
|
Contributory Pensions
16. The following table shows the number of
persons in receipt of a Contributory Pension/Allowance (excluding a Child
Allowance) at the end of 1995 and 1994:
|
|
|
|
Retirement Pension
Increased Retirement Pension National Minimum Retirement Pension Decreased National Minimum RetirementPension Increased National Minimum Retirement Pension Two-Thirds (Retirement) Pension Invalidity Pension Increased Invalidity Pension Decreased National Minimum Invalidity Pension National Minimum Invalidity Pension Widow’s Pension National Minimum Widow’s Pension Widow’s Special Allowance Widow’s Benefit Widow’s Allowance Early Survivor’s Pension Survivor’s Pension Disablement Pension Orphan’s Allowance Parent’s Pension |
5,365
4,226
7,186
60
1,544
9,574
902
827
65
2,617
1,979
7,435
6
-
2
1,169
1,132
361
9
-
|
5,523
4,199
7,338
55
1,599
10,329
1,074
726
63
2,996
1,994
7,555
6
-
1
1,240
1,322
372
13
-
|
+ 158
- 27
+ 152
- 5
+ 55
+ 755
+ 172
- 101
- 2
+ 379
+ 15
+ 120
-
-
- 1
+ 71
+ 190
+ 11
+ 4
-
|
|
44,459
|
48,176
|
+ 1,946
|
C. NON-CONTRIBUTORY SCHEME
Pensions
17. The table immediately hereunder shows the
number of persons in receipt of non-contributory Age, Blindness or Handicapped
Pensions/Allowances and Carer's Pension paid under the Act.
|
|
|
|
Old Age Pension
Blindness Pension Mentally/Severely Handicapped Pension Carer’s Pension Old Age Allowance |
3,833
129
1,794
191
494
|
3,716
133
1,830
209
410
|
- 117
+ 4
+ 36
+ 18
- 84
|
|
6,441
|
6,298
|
- 143
|
18. The immediately following table shows the number of households benefiting from non-contributory Assistance paid under the Act.
Type of Assistance |
|
|
|
Social Assistance
Sickness Assistance Milk Grant Leprosy Assistance Tuberculosis Assistance |
7,867
12,149
23
92
98
|
7,353
12,469
43
91
88
|
- 514
+ 320
+ 20
- 1
- 10
|
|
20,229
|
20,044
|
- 185
|
19. During 1995, the Department carried
out 5,399 financial investigations to determine the eligibility or otherwise
to Free Medical Aid (another form of assistance in kind provided for under
the Act). 5,292 were found to be eligible. During 1994, the number of financial
investigations carried out was 5,820 and these resulted in 5,631 cases
being accepted.
D. APPEALS TO THE UMPIRE
20. The immediately following table 9 shows how the number of appeals that were up for one or more hearings during 1995 were dealt with as compared with the same figures for 1994.
|
|
|
Brought forward from previous year
Lodged during the year Decided against appellant during the year
|
142
300 = 442 300
|
70
384 = 454 318
|
Still outstanding at the end of the year | 70 | 72 |
21. During 1995 the Department had to account for a total expenditure of Lml60,420,595 i.e. Lm8,472, 185 more than the previous year. Apart from administration and Capital expenses, etc., the quoted expenditure related mainly to Social Benefits, which entailed the issue of 1,369,284 cheques. About 190,500 of these cheques were issued by Area Offices, whilst the remainder were directly issued by Head Office. The State Contribution (vide table in para. 2) also forms part of this expenditure.
22. The payment of this large number of costly benefits entails a voluminous amount of work comprising the preparation of paysheets, to entitled beneficiaries, their regular adjustments due to change in circumstances, the writing of cheques, the deposit at Banks of the cheques due for payment on their maturity date and the sorting and reconciliation of accounts when these cheques are eventually encashed.
23. The table below shows the expenditure in 1995 on Social Benefits payable under the Social Security Act, 1987 vis-a-vis 1994.
Type of Benefit/Pension/Assistance/Allowance |
|
|
|
Pensions in respect of Retirement
Pensions in respect of Invalidity Pensions in respect of Widowhood Pensions in respect of Industrial Injuries Pensions in respect of Unemployment Children’s Allowance Maternity Benefit Sickness Benefit Orphan’s Allowance Parent’s Pension Marriage Grant Re-Marriage Gratuity Bonus |
43,383,655
5,413,819
17,017,809
473,086
625,235
15,611,980
386,922
1,100,951
7,020
-
234,702
20,486
8,107,523
|
48,478,754
6,202,692
18,536,874
484,911
637,687
15,521,530
488,416
1,087,454
12,100
-
241,244
5,384
8,204,318
|
+ 5,095,099
+ 788,873
+ 1,519,065
+ 11,825
+12,452
- 90,450
+ 101,494
- 13,497
+ 5,080
-
+ 6,542
- 15,102
+ 96,795
|
|
92,383,188
|
99,901,364
|
+ 7,518,176
|
Family Bonus
Pensions in respect of Age/Blindness Pensions in respect of Handicapped Social Assistance Medical Assistance Parental Allowance Handicapped Child Allowance Bonus |
2,784,740
3,595,752
1,745,511
8,296,305
3,066,349
1,002,668
102,899
2,500,914
|
3,456,041
3,715,635 1,926,105 8,306,916 3,299,279 859,616
104,413
2,292,032
|
+ 671,301
+ 119,883
+ 180,594
+ 10,611
+ 232,930
- 143,052
+ 1,514
- 208,882
|
|
23,095,138
|
23,960,037
|
+ 864,899
|
|
115,478,326
|
123,861,401
|
+ 8,383,075
|
F. COMPUTERISATION PROGRAMMES
24. The computerisation of many of the present manual systems is enabling the Department to improve its services and cater for the ever-increasing number of claims for Social Benefits.
25. The transition to and implementation of an integrated computer system is being carried out with the assistance of the Management Systems Unit and the Information Systems Development Division.
26. To date, the payment of all contributory
pensions, as well as non-contributory benefits, with the only exclusion
of Social Assistance, have been fully computerised. From 410 cases in OAA,
208 cases, for those persons who are in Geriatric institutions are still
being paid normally in cash.
G. CUSTOMER CARE OFFICER/MANUALS
AND LEAFLETS
27. This office was transferred to the Ground
Floor on 12 August, 1994 and decorated on modern lines to provide a comfortable
environment for the public and the Departmental staff. It continued to
improve the standard of the aim for which it was set up, namely to meet
complaints from the public and give the required information and necessary
assistance promptly. The number of claimants who made use of this service
during 1995 was 36,285 as compared to 33,242 who made use of this service
during 1994. The nature of the queries raised by these claimants
was as shown hereunder:
|
|
|
Contributory Benefits
Children’s Allowance Non-Contributory Benefits Contributory Pensions Enforcement |
5,965
7,357
4,499
9,111
6,310
|
6,696
6,174
5021
11,684
6,711
|
H. ESTABLISHMENT OF AN INTERNAL AUDIT FUNCTION
28. The Internal Audit Section was introduced within the Ministry for Social Security in October 1993. It is composed of one Principal Officer, namely Mr. Tonio G. Farrugia. This officer followed an intensive course on Internal Auditing organised by Staff Development Organisation with the collaboration of Management Systems Unit which lasted 18 months. Mr. Farrugia also followed Training Programmes on 'Discovering Risks in Computerised Information Systems' and 'The Audit of Advanced Computer Systems', and The Internal Auditor BS EN ISO 9000'.
Since the setting up of this section, several programmes have been carried out resulting in the change of both the manual and computerised systems of the Department, making the current system more effective, efficient and reliable. Changes carried out included:
I. AREA OFFICES
29. The Department has twenty Area Offices in Malta, viz: at Balzan, B'Kara, Cospicua, Hamrun, Luqa, Marsa, Mosta,Msida, Naxxar, Paola, Qormi, Rabat, Sliema, St. Paul's Bay, San Gwann, Valletta, Zabbar, Zebbug, Zejtun, and Zurrieq and two in Gozo, viz: at Victoria and Nadur.
Work carried out at Area Offices mainly comprised:-
J. STAFF
32. During 1995 the staff complement of the Department of Social Security decreased by 10 when compared to the complement on 31st December, 1994, as shown in the immediately following table:
|
|
|
|
|
|
|
|
|
- 11 | + 1 | - 10 |
Of the staff referred to in the preceding paragraph, 20 (as on 31/12/95) were performing duties in the Department's 2 Area Offices in Gozo.
|
|
|