Social security schemes of government

4. These schemes are imposed, controlled and financed by government units and cover the entire community, or large sections of the community. Social security schemes of government may be funded or unfunded. When separate funds can be identified, they remain the property of the government and not of the beneficiaries of the schemes. Social security schemes' receipts consist mainly of contributions paid by individuals and by employers on behalf of their employees, but they may also include transfers from other government units. Participation in social security schemes is usually, though not always, compulsory. The benefits paid to individuals are not necessarily determined by the amounts previously paid in contributions.

It should be noted that social insurance schemes organised by government units for their own employees are not classified as social security schemes, but as private funded or unfunded social insurance schemes.