Conceptual framework for the development of financial support for social protection in Ukraine

Abstract

Introduction. The social protection in Ukraine is characterised by a complex multicomponent structure of funding, which is determined by a number of economic, demographic, social and political factors. Problems of economic development and a complex socio-demographic situation affect not only financial resources but also the level and quality of social benefits and services. Therefore, the development of a new concept of financial support for social protection to ensure balanced funding of all social benefits and allowances is currently a burning issue. The purpose of the article is justification of the conceptual framework for financial support for social protection in Ukraine. Results. The authors of the article have developed and formalised a conceptual framework for social protection of the population to create a comprehensive system that will balance financial resources at all levels and in terms of all forms of social protection. It has been proven that a comprehensive system of social security provides social assistance through: 1) the public system of social security formed based on taxes paid to the budget of the country; 2) compulsory social insurance represented by cash payments and bonuses received by employees; 3) a non-governmental social insurance system (the formation of financial resources through contributions to non-governmental social security institutions or social programs developed by employers). It was determined that people can get the same kind of social benefits (e.g. pensions and medical services) through various levels of social protection. This will enhance the impact of the system on the population and affect the final size of social payments (or the amount and quality of provided social services). Conclusions. It has been proven that this multifunctional system with clear separation of powers for the formation along with the use of financial resources will increase the level of social security in the future, reduce social tensions and the pressure upon public finances due to programs of social assistance to the poor. Expansion of accumulative financing principles has a positive impact on the financial stability of the entire system of public social protection and contributes to social and economic development, providing reduction in poverty and wealth disparity.