Diversity in Moving Towards Integrated, Coordinated and Equitable Social Protection Systems - Experiences of Japan, the Republic of Korea, and Taiwan, Province of China

This paper aims to draw lessons that may help address issues of fragmentation in welfare systems in China and other countries. To do so it reviews how Japan, the Republic of Korea (ROK), and Taiwan, Province of China, established their welfare systems. In particular, it examines how they dealt with fragmentation in government provision of welfare benefits and social services in the areas of primary health care and medical insurance, compulsory education, social assistance and basic pension programmes. Research on these three East Asian cases shows that there are many similarities in their social policies in terms of the influence of the Second World War’s historical legacy on their welfare institutions, and how rapid industrialisation also affected the shape of these institutions. All three considered poverty an “economic structural problem” to be solved through private employment rather than public assistance, and social policy was understood as both a short-term strategy to legitimise political power and as a pre-emptive measure to contain the problems of industrialisation. Also, while all three cases have been struggling with increasing inequality over the past two decades, they performed well in terms of poverty and inequality reduction up to the 1990s. Based on the analysis of these experiences, this paper challenges the assumption that a welfare state is a luxury that can only be built after reaching a certain level of economic development. It also notes that the content, nature and timing of public sector provision of different welfare services and transfer schemes are affected by the historical institutional infrastructures specific to each of the welfare schemes. Seen in this light, each scheme is distinct in terms of the actors, processes and institutions involved. The paper therefore questions the ability of the welfare regime approach to explain the development of welfare states in different countries and regions, as such an all-encompassing approach may well mask variations across the different sectors within a welfare state. The paper also points out that interactions among different welfare schemes may create structural isomorphism, in the sense that similar levels of integration/fragmentation can be observed across different welfare schemes in each country or region. While it is difficult to draw lessons on the sequencing of integration of fragmented welfare schemes, the experiences of ROK and Taiwan show that schemes which were financially unstable or internally unequal were the first to be integrated. However, fragmentation of welfare schemes does not necessarily preclude universal coverage. The two features can still be compatible when there is a set of institutions to create institutional complementarity and maximise synergies between fragmented welfare schemes. Last but not least, the role of government as a mediator and coordinator among different interests is key to welfare reform. It is complemented by private sector and civil society organisations, which also play a crucial role in the process, through improving welfare accessibility and translating public demand into policies.