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To support migrants who get into difficulties overseas, a number of countries of origin have now established welfare funds. Financed largely through a levies from migrants, these funds can, among other things, provide various kinds of emergency assistance.
The Philippines pioneered this activity and similar funds have now been established in a number of other countries. These funds provide death and disability insurance and assistance in forced repatriation in the event of illness, violence at
work, contract violation, or non-existent jobs. They can also be used for court litigations in countries of employment, medical care for injured workers abandoned by their employers, and for conciliating disputes.
In addition the funds can provide financial assistance to migrants’ families at home for education and training, or for business and other activities.
Most of the funds' income comes from migrant workers, who are typically charged around $25 for each contract period. But they also get income from other sources. In Bangladesh, for example, the Wage Earners’ Welfare Fund for migrant workers is based on subscriptions from the migrant workers, licenses of recruiting agencies, surcharges on the fees collected through the missions abroad and personal and institutional contributions.
For the distribution of insurance benefits, these funds can operate in various ways. In Sri Lanka and Pakistan, for example, they channel migrant insurance through state insurance companies, while
in the Philippines the welfare fund handles insurance
claims itself.
However, some of these welfare funds have been criticized because they may use the contributions of many ordinary migrant workers to benefit a privileged few — for example, paying for scholarships and the establishment of colleges.
What the ILO can offer
ILO's Social Security Department has wide experience of different kinds of welfare funds around the world and can advise governments on how such funds can be established and on how the funds can be invested and disbursed.
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