Guatemala

Guatemalan social protection is characterised by limited coverage and segmentation along socioeconomic lines. Formal sector workers have access to the country’s social security system consisting of several different schemes. Those not covered by these social security arrangements may benefit from social assistance and public services. Private insurance and services, on the other hand, cater for those with the means to pay. In recent years, non-contributory cash transfers to the poor and other policies have been introduced in order to reduce poverty and counter traditional exclusion patterns in social protection.

The backbone of the country’s contributory social security is the Guatemalan Social Security Institute (Instituto Guatemalteco de Seguridad Social, IGSS), which was established in 1946. It offers social security benefits for affiliated workers, mainly in the formal economy. In principle, IGSS affiliation is compulsory for formal sector companies with three or more employees. In 2010, there were 5,1 million workers in Guatemala, out of whom only 1,1 million, or around 22%, were affiliated to the IGSS. While the high rate of informal employment party explains this low coverage, in 2006, one-third of the formal sector workers did not contribute to the system. IGSS coverage is thus low and in gradual decline, and continues to be limited mainly to the urban non-poor. Financed by contributions from workers, employers and the state, IGSS provides pensions for the elderly, disabled and survivors; and cash benefits and health services in case of illness, maternity and accidents. Health services cover insured workers, their pregnant female spouses during pregnancy and affiliated persons’ children below the age of seven.

In addition to IGSS, there are two other public obligatory social security schemes: one for civil servants (Clases Pasivas Civiles del Estado, CPCE), established in 1923, and another for the military (Instituto de Previsión Militar, IPM), established in 1966. In addition, smaller schemes cater for the workers of public enterprises, banks, municipal organisations and other public organs, the members of which are also covered by IGSS, thus enjoying double protection.