Service Provider to develop Social Security Risk Management Framework

BACKGROUND

The Social Security system was first established by the Royal Government of Cambodia (RGC) with the establishment of the National Social Security Fund (NSSF) in 2007 under the provision of the 2002 Law on Social Security. The Employment Injury Scheme was launched in the same year, followed by the establishment of the mandatory Social Health Insurance (SHI) in January 2016. This is followed by the Private Sector Pension scheme which will be formally launched in October 2022.

Given the ongoing development of the Social Security system, the Ministry of Economy and Finance which provide financial tutelage to the NSSF began to establish a focal institution to oversee operations and regulate activities related to the financial aspect of Social Security. This resulted in the setting up of the Division of Pension and Insurance under the management of the General Department of Financial Industry in the Ministry of Economy and Finance in 2015.

To further promote efficiency, effectiveness and development of the Social Protection system as a whole, the RGC introduced the National Social Protection Policy Framework 2016-2025 (NSPPF) which established the Social Security system as one of the two pillars of the Social Protection system and lay out the Governance structure of the system:

At the policy level, the National Social Protection Council (NSPC) is established in 2017 together with the Executive Committee of the National Social Protection Council (NSPC-EXCO), established in 2018 to serve as a coordination mechanism between the policy and technical levels to support all functions and duties of the National Social Protection Council. The work of the NSPC and NSPC-EXCO is supported through the General Secretariat of the National Social Protection Council (GS-NSPC)

At the operational level, several institutions such as the NSSF, the National Social Security Fund for Civil Servant (NSSFC), the National Social Security Fund for Veteran (NFV) and the Payment Certification Agency (PCA), conducts the relevant social security operations pertaining to the social security schemes the respective institutions manage. To harmonise and strengthen the social security sector, the RGC promulgated the Law on Social Security in 2019 which established the NSSF as the sole operator of social security in Cambodia. It also defines the establishment of a Social Security Regulator which is responsible for setting prudential regulations, operating standards, guidelines on investment of Social Security Funds, the monitoring of the financial sustainability of the Social Security operator and establishing dispute mechanisms to enhance members protection.

Through the Law on the Organization and Functioning of the Non-Banking Financial Service Authority (NBFSA), the Social Security Regulator (SSR) was established in 2022, with the objective of ensuring compliance, transparency, accountability, and financial sustainability of the Social Security system through the issuance of regulation, operating standards, guidelines and other prudential measures. Key to the functioning of the SSR would be to develop the necessary frameworks, regulations, standards and guidelines to such that is able to fulfil its role of supervising the Social Security system and achieve its mandated objectives.

OBJECTIVE

The objective of this technical assistance is to support the SSR in developing the key frameworks , structures and processes to enable it to carry out its defined roles and responsibilities.

Establishing a Risk Management Framework and relevant financial and operational Indicators would be necessary in order for the SSR to put in place processes and structures to provide Risk Based Supervision and to systematically identify, monitor and mitigate both operational and financial risks to support the development of the Social Security system so that it meets its objectives in a financially sustainable way. In addition, the consultant is expected to identify the principles of how the SSR would carry out its supervisory role based on the risk framework developed.

This work consists of the following key tasks:

• Development of risk assessment framework through which the SSR carries out supervision of the NSSF
• Detailed identification, analysis and evaluation of the operational and financial risks within the social security system in Cambodia. This would include metrics through which these risks should be assessed by the SSR
• Prescription of indicators to be adopted to monitor the operational and financial performance of the NSSF based on international benchmarks adjusted to the Cambodian context
• Detail the personnel, resources, reporting lines, tools required of the Regulator to implement a risk-based supervision of the Social Security system and assessment of performance.
• Detail the reporting requirements of the SSR and input of the SSR into improving the risk management structures and processes of the NSSF

EXPECTED DELIVERABLES

1. An inception report of maximum 20 pages in English, detailing the methodology that the consultant will take to complete this assignment, including possible modifications to the methodology.
2. An Interim Report containing the validated operational and financial risks of the social security system in Cambodia
3. A compendium of international case studies on risk management within the social security system
4. A Final Report containing the validated Risk Management Framework, including prescription of indicators to be adopted to monitor the operational, financial and other identified risks. The final report also includes the proposed personnel, resources, reporting lines and tools required of the Regulator and the reporting requirements and input of the SSR to improve the risk management structures and processes of the NSSF.

METHODOLOGY

The process will be highly participatory and ensure that the staff from the Social Security Regulator and key stakeholders such as the NSSF, the NSPC, Board Members of the NSSF and stakeholders within the NBFSA are consulted and can build their technical capacities throughout the process of the assignment and have ultimate ownership over the products of this technical assistance.

The SSR will be the owner of the outputs and will also provide administrative support for the service provider engaged to deliver the work. The ILO will review and provide technical backstopping of the service provider engaged to ensure that it meets the required quality of work.

  The complexity of the assignment necessitates contracting a service provider with the capacity and experience to conduct this work. The appointed service provider shall be led by a Lead Expert who will be ultimately responsible for the coordination and the quality and the coherence of the deliverables. The appointed service provider should also be supported by relevant international and national experts in the various domains related to risk management within the social security sector.

The appointed service provider will work closely with the SSR to ensure that inputs from the different national stakeholders are taken into consideration in the methodology of the study. In addition, in collaboration with the SSR the service provider will also collaborate with the development partners, including the ILO, particularly through the use of currently existing mechanisms for collaboration such as the formal and informal Development Partners Coordination mechanisms and working groups.

TENTATIVE TIMELINE OF DELIVERABLES

The consultancy is scheduled to start in November 2022 and completed by May 2023

APPROACH

The Service Provider is expected to liaise with the relevant Ministries and institutions responsible for the various social protection programmes and schemes, and meet with the relevant stakeholders and civil society organizations to obtain feedback, validate the findings and recommendations, and integrate their comments in the report. Gender perspectives shall be taken into consideration.

CONTRACT SUPERVISION

The ILO Social Protection Manager, with oversight from the ILO Senior Technical Specialist on Social Protection, will provide day-to-day supervision of the contract ensuring the articulation between the service provider and the General Secretariat of the National Social Protection Council. The ILO Head of the Regional Actuarial Unit will provide technical supervision as required.

REQUIRED PROFILE OF SERVICE PROVIDER

The International Lead Expert shall meet the following qualifications:     

1. Advanced university degree in Public Policy, Social Sciences, Economics, Political Science or related disciplines.
2. At least 10 years of experience in social security management and operational issues as well as  policy, financial  and technical knowledge in social protection with significant experience in countries with mature social security system.
3. Familiarity with Social Security operations and management of operational and financial risk management of Social Security organisation.
4. Familiarity with the Cambodian national context is considered as an asset.
5. Proven experience in conducting research and technical consultancy on social protection issues.
6. Excellent report drafting ability and fluency in English is required.

It is recommended that the service provider includes National Expert(s) to facilitate the delivery of the outputs. Individual consultants are encouraged to apply for either the International Lead Expert position or the National Expert position.

The National Expert(s) shall meet the following qualifications:

1. Advanced university degrees in Public Policy, Social Sciences, Economics, Political Science or related disciplines.
2. At least 3 years of experience and technical knowledge in social protection issues in Cambodia.   
3. Experience in management and operational issues (either public or private sector); a background in risk management issues would be a bonus 
4. Excellent report drafting ability
5. Fluency in English and Khmer is required.
6. Excellent communication skill is an advantage

SELECTION CRITERIA

Interested providers are invited to submit their technical and financial proposals with a daily rate for their services based on the number of working days. The technical proposal should demonstrate the specific experience required and to provide reference of previous related work. The applications will be evaluated based on the experiences of the service provider in delivering the work.

SUBMISSION OF APPLICATION

The Service Provider should send their technical proposal including CVs of team members and previous similar works to PN2-SOCPRO@ilo.org. The financial proposal shall be submitted separately to kanhchana@ilo.org Both technical and financial proposals are to be submitted by 28th October 2022 at 5pm, local time in Phnom Penh, Cambodia. Late submissions will not be considered

Please refer to the attached TOR for further details.