ABSTRACT
Social security is a complex system of vertical and horizontal income redistribution. It involves the collection of large sums of money from the general population and the allocation of these sums to groups of beneficiaries. This chapter examines the financial aspects of social security, i.e. what taxes are being paid for social security and by whom, how these taxes are collected and managed, and the overall cost of social security to the community. The Beveridge Report and the National Insurance Acts, 1946 accepted the established tripartite method of social security finance. As the Beveridge Report pointed out, however, apart from the above misgivings, if employers were made responsible for the finance of the industrial injury scheme they would also be entrusted with its administration. Countries differ a great deal in the way they distribute the cost of social security between employees, employers and the state.
