Assessing Contribution Collection: A Case of SOCSO’s IPS
Mohd Zaki Awang Chek1, Isma Liana Ismail2, Nur Faezah Jamal3
1Mohd Zaki Awang Chek, Department of Computer and Mathematical Sciences, Center for Actuarial Studies, Universiti Teknologi MARA, Tapah, Perak, Malaysia.
2Isma Liana Ismail, Department of Computer and Mathematical Sciences, Center for Statistics and Decision Science, Universiti Teknologi MARA, Tapah, Perak, Malaysia.
3Nur Faezah Jamal, Department of Computer and Mathematical Sciences, Center for Statistics and Decision Science, Universiti Teknologi MARA, Tapah, Perak, Malaysia.
Manuscript received on 11 October 2019 | Revised Manuscript received on 20 October 2019 | Manuscript Published on 02 November 2019 | PP: 621-623 | Volume-8 Issue-2S11 September 2019 | Retrieval Number: B10960982S1119/2019©BEIESP | DOI: 10.35940/ijrte.B1096.0982S1119
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Currently, Social Security Organization (SOCSO) administers two types of protection schemes namely the Employment Injury Scheme (EIS) and the Invalidity Pension Scheme (IPS). Both schemes are effective once employers make contributions to SOCSO. These contributions are taken 2.25% of an employee’s monthly gross income. Recent statistics show that, the excess of SOCSO’s IPS claims amounted to RM4.5 billion, which was an increase of 19.7% from the previous year. Yet, the contributions only amounted to RM4.3 billion. This critical situation assessed using single linear regression modelling and it can be solved by improving the current SOCSO’s IPS funding system. As suggested in this study, the funding system could be made more effective through an increase of the fund collection by raising the current contribution rate. The contribution rate is determined through recent social and economic data, such as current mortality rate and interest rate.
Keywords: Contribution Rate, Invalidity Pension Scheme, Regression Analysis, SOCSO.
Scope of the Article: Regression and Prediction