Lao Social Security Organisation officials improve their actuarial and modelling skills

The capacity of officials in Lao People’s Democratic Republic to manage the financial health of the country’s social security schemes is being strengthened through the support of ILO and the United Nations Peace and Development Fund. Training held in Luang Prabang during 19-22 February 2024 saw members of the Actuarial Valuation Committee learn about the methodology and formulas used in demographic, labour force, economic and pension models. They also looked at how to use actuarial results for policy making. Speaking at the training, Veomany Khamphai, Chief of Planning and International Cooperation at the Lao Social Security Organisation, stated that, “An actuarial valuation has been completed with the support of ILO, and it provides a strong basis to amend the country’s Social Security Law. The topic is new for many members, and there is a great need to strengthen capacities on financial modelling.”

Lao People’s Democratic Republic is amending its Social Security Law to improve the financial sustainability of the National Social Security Fund and ensure better compliance with international labour standards, particularly the Social Security (Minimum Standards) Convention, 1952 (No. 102). To assess the sustainability of the fund, ILO is supporting the Lao Social Security Organisation to conduct an actuarial valuation. The valuation projects future cash flows into the fund and benefits paid out to members. An actuarial model was constructed and the findings were documented. The process is overseen by an Actuarial Valuation Committee, consisting of members from the Lao Social Security Organisation, the Labour Market Information and Statistics Divisions of the Ministry of Labour and Social Welfare, and the National Health Insurance Bureau. ILO organized a series of trainings on basic concepts and actuarial methodology for the committee members over 2022-2023. The February 2024 training was a follow up to this, helping further strengthen national capacities and build participants’ confidence. “The training was really hands-on, and participants worked in small groups, helping each other out,” reflected Thongleck Xiong, National Project Coordinator, ILO. “The trainer set small problems and identified two to three key participants with strong Excel skills, typically with statistical roles in their organisations. These participants could grasp the modelling techniques quickly and help out their group members to solve the problems on their laptops.”