The Hungarian Social Law

The Hungarian Social Law Presented by: Dr. Tóth Date: 16 August 2023 The Fundamental Law - The Fundamental Law regulates social security rights at the highest level - Article XIX regulates - Hungary shall endeavor to provide social security for all its citizens. It shall provide assistance to Hungarian citizens in the event of life situations: - • Maternity, • Sickness, • Disability, • Widowhood, • Orphanhood and • Unemployment Individuals are not equally entitled to social entitlements (new element) may be set by law in proportion to the usefulness of the activity for the community - It regulates old age as one of the main life situations - The pension system is laid down in the Fundamental Law and has two pillars: • A single public pension scheme based on social solidarity • Voluntary social institutions Special State Pension For Women - The different entitlements of women to pensions are also regulated at the level of the Fundamental Law: a law may lay down the conditions for entitlement to a state pension with regard to the requirement of increased protection for women Principles In Social Security System - 1. The principle of compulsory participation means that participation in the social security system is compulsory as regulated by the system. - 2. The principle of limited insurance means that insurance is limited within the constitutional framework of social solidarity and property. - 3. The principle of proportionality, according to which the insured person is, as a general rule, entitled to cash benefits in proportion to the amount of the contribution paid, from which the law may contain different provisions - 4. Under the principle of the obligation to pay contributions, entitlement to social security benefits is conditional on the insured person's fulfilment of the obligation to pay contributions - 5. The employer is liable to pay contributions - 6. Principle of personal data transmission for a specific purpose: a single register serves the functioning of the health insurance and pension insurance schemes, - 7. underlying responsibility of the State: the State ensures the coverage of social security benefits even if social security expenditure exceeds revenue The Sustainability Of Social Security Systems - The sustainability of social security systems is also an ongoing issue, given the problem of an ageing society. Changes in Hungary - In 1998 in Hungary, a major change in the social security system took place, notably in the area of pension insurance. Three pillars were introduced: - • A state pension scheme • A compulsory private pension scheme • Supplementary voluntary insurance funds In 2010, the compulsory private pension fund system was abolished, and now two pillars also enshrined in the Fundamental Law - In 2012, there was a major change in the institutions providing health care services, with the transfer of municipal hospitals to state ownership from local government - And the introduction of centralization of hospitals from 2021. - 2020 • In 2020, a major change was the adoption of a new law, the Health Service Employment Act, with a significant increase in the salaries of doctors, one of the main aims of which was to abolish the gratuity system. Financing Of The Health Care System - The financing of the health care system is extremely complex and difficult to understand. - To quote János Kornai: "It is difficult, very difficult, to maintain financial discipline in the health sector, everyone is interested in overspending: • The patient hopes for a safer and faster recovery, • For the doctor, it makes it easier to cure, • The pharmaceutical company and the technical equipment manufacturer can sell more products at a higher profit." QUESTIONS - Can all principles be expected to apply to all entities? - Is there a need to define the balance between solidarity and insurance principles, and can these principles shift if one uses private insurance? - Does the principle of proportionality apply without restriction - can a person receive a benefit commensurate with the amount of contributions paid? - The amount of cash benefits - childcare allowance, sick pay is capped, even though there is no upper income limit for contributions. I am thinking, for example, of anomalies of this kind in relation to proportionality Concluding Remarks - In the context of pension provision, the question arises again and again whether, in addition to the state pension system based on the pay-as-you-go principle, there is not a need for an efficient, funded occupational pension system with higher contribution obligations. - How can the employees/self-employed in the new forms of employment that are emerging with digitalization be integrated into the social security system?