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Report No. 138

7.9. Social security benefits.-

It may be safely asserted that benefits in kind are also a part of social security which is not expressly or impliedly restricted to 'cash' benefits. For example, as already mentioned,1 the first national compulsory health insurance scheme introduced in Germany in 1883 represented a benefit in kind, and was built upon precedents going back many years in the separate German States. In fact, National Health Schemes throughout the world are of three types viz,2

(i) direct service approach in which the Government provides the facilities;

(ii) indirect contract with the providers, in which private hospitals or practitioners provide the service, but the State pays the provider for services used; and

(iii) reimbursement, in which the patient pays the bill and submits the receipted bill for reimbursement. The first system prevails in the United Kingdom, the second system prevails in Belgium, West Germany and the Netherlands, while the third system is widely used in France and some Northern European countries and (to some extent) in Australia and Sweden.

The first category mentioned above shows that benefits in kind have formed a part of social security.

1. Para. 7.7, supra.

2. Encyclopaedia Britannica, Macropaedia, (1987), Vol. 27, pp. 435, 436.



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