In addition to pensions, various types of allowances have also been established to help support families with children. Some examples include: one-time payments at child birth, single mother support, and support to mothers with juvenile invalids. In addition, senior citizens are eligible to live in boarding homes in which care is provided by the state.
In the former Soviet Union these types of state support programs came in many different forms such as discounts, sanitarium treatment, subsidies, and travel transport. These privileges were granted irrespective of the citizens income. Today, increasing difficulties in the financing system have brought about a crisis. In such a situation, some pivotal points of social protection have emerged that require thought and consideration.
If the economy is going to get back on track, child and family allowance expenditures must be reduced. This should be done by targeting only those groups that are in direct need of the transfers. In the future, a more rigorous testing system must be used in order to establish and monitor the money transfers correctly. In the short-run, the allowances must be kept at a flat-rate benefit while reducing their value in real terms.
The Ministry of Social Welfare of the Population must identify a strategy for reform of the social safety net. Currently, they have come up with a three stage system that will work to improve the current system over the next three years. First, they must plan the provisions to target the most vulnerable low-income families and to maintain a base level of social services. The intention is to redistribute the available resources in order to provide assistance to the families that need it the most. This will help to reduce the social pressures on the progress of economic reform. The second stage envisages more active participation of society based on the principles of self support. This will be possible on the basis of a compulsory social insurance system and the development of numerous non-state voluntary funds. In the longer term, the plan will be to decentralize main expenditures for social support from the national to the regional level, from the state budget to the private savings of citizens, and from budgetary financing to social insurance. In turn, this will lead to the end of inequities apparent in the present system of social protection. When this occurs, social insurance will have a reliable financial base and be able to satisfy a wide range of citizenís individual needs.
Intergovernmental Fiscal Relationships
There are essentially two levels of government in Kazakhstan: central and oblast - local governments. Responsibilities for stabilization policy are assigned to the central government; the centralized system provides service standards to each locality, applies equal taxes, and facilitates regional and personal redistribution.
Kazakhstan government attempts to simultaneously restructure its economic system, protect the well-being of its citizens, stabilize prices, achieve external balance, and establish a system of governance acceptable to 19 oblasts whose cultural identities, natural resource endowments, and degree of economic development differ widely. The primary intergovernmental fiscal issue is to what extent decentralizing expenditure functions and tax collection to oblast - local governments is economically desirable.
Bibliography
Banks and Banking in Kazakhstan. ITAIEP. November 1995, http://www.itaiep.doc.gov.
De Melo, Martha. ìFrom Plan to Market: Patterns of Transitionî. Policy Research Working Paper 1564. The World Bank Policy Research Department, January 1996.
De Melo, Martha. ìThe Cultural Foundations of Economic Reform.î Policy Research Working Paper, 6819. The World Bank Policy Research Department, June 1997.
ìEconomic Overview of Kazakhstanî. IEP. June 1996, http://www.iep.doc.gov.
Kazakhstan. IMF Economic Reviews 18, Washington, DC. April 1995.
Kazakhstan. Country Report, The Economist Intelligence Unit. 2nd Quarter 1996.
Kazakhstan. Country Report, The Economist Intelligence Unit. 3rd Quarter 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. August 1, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. July 1, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. June 3, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. April 9, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. March 1, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. February 1, 1996.
Kazakhstan: Economic Update. American Embassy, Almaty. January 4, 1996.