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Updated by Pablo CASALÍ on 14.03.2014

Peru’s social protection system has its roots in the Entitlement Law (Ley de Goces) of 1850, which introduced a retirement scheme exclusively for public servants. However, it was only recently, at the beginning of the 20th century, that the system began to significantly develop, with the emergence of a series of standards related primarily to industrial security and work accidents. With the creation of the Compulsory Social Security for Workers in 1936, contributory social security was established in Peru.

During the 1950s and 1960s, social protection policies developed according to a segmented universal model. Later, with the Constitution of 1979, and for the first time in the country, the right to social security was granted constitutional status in an extensive and detailed way.

In the 1990s, social security underwent a major change. Regarding pensions, the Private Pension System (Sistema Privado de Pensiones, SPP) was created and introduced the Individual Capitalization Funding System for the provision of  old-age, disability, or death benefits. In health care, the reform promoted the participation of private firms through a complementary scheme under the supervision of the Superintendence of Health Care Providers (Superintendencia de Entidades Prestadoras de Salud, SEPS). The Supplementary Occupational Risk Insurance (Seguro Complementario de Trabajo de Riesgo, SCTR) was also created.

Since the beginning of the new millennium, the government has sought to guarantee universal coverage of essential health care and income security over the course of individuals’ life cycles. In this context, the Integral Health Insurance (Seguro Integral de Salud, SIS) was created in 2002. Its primary function is to manage funds allocated to the financing of benefits of Peruvians who, due to poverty or extreme poverty, do not have health insurance. In addition, in 2009, the Universal Health Insurance Law was passed and established the right to quality and timely health care to all residents in Peru, from their birth to their death.

Furthermore, the Ministry of Social Development and Inclusion (Ministerio del Desarrollo e Inclusion Social, MIDIS) is carrying out the National Social Development and Inclusive Growth Strategy, "Incluir para Crecer”, which reiterates the guiding principles of the Social Protection Floor Initiative led by the International Labour Organization (ILO) to promote access to essential health care and income security over the life cycle of the most vulnerable people.

In this context, the most important challenges the country faces in terms of social protection over the next few years are: the extension of social security coverage, the institutionalization of contributory unemployment insurance that is complemented by social-labour integration policies and capacity development, and the improvement of the coordination and integration of contributory and non-contributory policies.