The Contribution Points System: A New Social Security Model
Connecting Local Welfare, Social Contribution, and Future Social Security
The Contribution Points System is a new participatory social security model proposed by FMO-AOKI in Japan.
It aims to address two challenges at the same time: supporting people and communities in need—including disaster-affected areas and children from low-income families—and responding to the growing shortage of people who support local welfare, while seeking to achieve these goals without creating substantial additional fiscal burdens.
The basic flow of the system is:
Paid local welfare activities
↓
Compensation
↓
Donations to disaster relief and other social causes
↓
Recorded as Contribution Points
↓
Future use toward the participant's own elderly care and other eligible social security costs
The idea is simple.
Help someone in your community today.
Use part of the value created by that activity to support people or communities you care about, such as disaster-affected areas or children in need.
Preserve that social contribution as a record.
And if you need support in the future, allow part of your past contribution to help support you.
In this way, one activity can connect three forms of support:
• helping someone nearby
• helping someone farther away
• preparing for your own future
Why This System May Be Needed
Japan is facing rapid population aging and population decline.
While the number of older people is increasing, the working-age population available to provide elderly care, daily living support, childcare assistance, monitoring, and other local welfare services is decreasing.
This raises several important questions:
• Who will support a growing elderly population?
• How can communities respond to shortages of care and welfare workers?
• How can younger and working-age generations be encouraged to participate in local welfare?
• How can social security remain financially sustainable?
• How can communities reduce social isolation?
The Contribution Points System is an attempt to address these challenges not separately, but through a single social cycle.
Five Steps of the Contribution Points System
Step 1: Establish Appropriate Compensation for Local Welfare Activities
Local governments, social welfare councils, welfare facilities, and other organizations identify activities that are needed in the community and establish appropriate compensation or honoraria.
Possible activities include:
• grocery shopping assistance for older people
• cleaning and household assistance
• checking on isolated people
• daily living support
• childcare assistance
• non-specialized support tasks in elderly care facilities
• community activities
The main focus is on activities that do not necessarily require professional care qualifications but are nevertheless important for supporting daily life and welfare services.
Step 2: Citizens Participate in Activities That Suit Them
Citizens use smartphones or other digital services to find welfare activities available in their communities.
They can choose activities according to their available time, abilities, interests, and location.
For example:
“I can participate for two hours today.”
“I can help on weekends.”
“I can participate if the activity is close to my home.”
People would not necessarily need to make a long-term or fixed weekly commitment.
This could create a new entry point into local welfare activities for working-age people and others who have found traditional continuous volunteering difficult.
Step 3: Participants Receive Compensation and May Choose to Donate It
After completing an activity, participants receive compensation or an honorarium.
They may keep the compensation themselves.
Alternatively, if they wish, they can donate part or all of it to a cause they want to support.
Possible recipients include:
• disaster-affected communities
• children's meal programs
• organizations supporting children from low-income families
• local welfare organizations
• the participant's hometown
• other social causes
An important principle is that donations should not be compulsory.
Participants should generally be free to decide whether to donate, how much to donate, and which cause to support.
Step 4: Donations Are Recorded as Contribution Points
The amount donated is recorded as a social contribution.
Under the proposed system, the national government, local governments, or another authorized public institution would manage these records as Contribution Points.
This allows today's social contribution to remain as a record connected to the future rather than disappearing once the donation has been made.
Step 5: Contribution Points May Support the Participant in the Future
If participants later need elderly care or another form of social support, accumulated Contribution Points could be used to reduce certain out-of-pocket costs.
Possible uses might include:
• out-of-pocket costs for long-term care insurance services
• certain expenses associated with elderly care facilities
• other social security-related costs considered appropriate under the system
The exact range of eligible expenses would require careful consideration when the system is designed.
The basic principle is to connect:
“contributions made to society during one's active years”
with
“support that the same person may need later in life.”
Addressing the Shortage of Local Welfare Workers
One of the largest challenges facing aging societies is the shortage of people supporting elderly care and local welfare.
Professional care workers and welfare professionals will remain essential.
Tasks requiring specialized knowledge and skills—such as physical care, dementia care, medical coordination, care management, and professional assessment—should continue to be performed by qualified professionals.
The Contribution Points System is not intended to replace professional care workers with local residents.
Rather, it proposes a clearer division of roles.
Professional workers
↓
Concentrate on specialized tasks such as physical care, dementia care, medical coordination, and other work requiring professional expertise
Local residents
↓
Support appropriately separated non-specialized tasks such as shopping assistance, cleaning, meal serving, checking on older people, conversation, and other daily support
This could allow limited professional care resources to be concentrated where their expertise is most needed while increasing the overall support capacity of the community.
Creating New Reasons for Younger and Working-Age People to Participate
In Japan, initiatives already exist in which local residents participate for compensation in non-specialized support activities related to elderly care, including services such as Suketter.
These are important initiatives.
When local residents perform peripheral tasks that do not require professional care workers, professionals can concentrate more effectively on specialized and higher-value work.
At the same time, because these activities can have a different cost structure from conventional employment, temporary staffing, or outsourcing, they may also contribute to reducing the overall cost of providing elderly care and welfare services.
However, participants in such activities may often be people who already have a strong interest in elderly care or community welfare.
As a result, some facilities or communities may still be unable to attract enough participants to meet the amount of support required.
At the same time, many younger and working-age people may think:
“I want to help someone.”
“I want to support disaster-affected communities.”
“I want to support children.”
“I also want to prepare for my own future.”
The Contribution Points System creates additional reasons to participate even for people who may not initially have a particular interest in elderly care itself.
A person can help someone nearby.
The compensation earned through that activity can support a person or community the participant cares about.
And that social contribution can also become part of the participant's own future security.
In other words:
Helping someone today can also help someone else and help prepare for your own future.
If this broader motivation brings people into local welfare activities who have not previously participated, the system could help ease workforce shortages and may also reduce the overall cost of providing elderly care and welfare services.
Supporting Disaster-Affected Areas Through Activities Close to Home
Another important feature of the Contribution Points System is that people could support distant communities through activities performed close to home.
Consider someone living in Tokyo who wants to support disaster recovery in Kumamoto.
The person may genuinely want to help but may be unable to travel because of:
• work
• family responsibilities
• distance
• travel costs
• limited time
Instead, that person could participate in a local welfare activity in Tokyo, such as helping an older person with grocery shopping or supporting non-specialized activities at an elderly care facility.
The participant could then donate part or all of the compensation from that activity to disaster recovery in Kumamoto.
Local welfare activity in Tokyo
↓
Support older people and welfare services in Tokyo
At the same time:
Compensation from the activity
↓
Donation
↓
Support recovery in Kumamoto
And further:
Donation recorded as Contribution Points
↓
Potential future support for the participant
This creates a cycle connecting:
• helping someone nearby
• helping someone farther away
• helping support your own future
These three forms of support are normally treated separately.
The Contribution Points System attempts to connect them within a single social mechanism.
Strengthening Local Communities and Reducing Isolation
The potential value of the system is not limited to workforce supply or financial savings.
Population aging, urbanization, smaller households, and changing lifestyles have weakened some traditional forms of community connection.
Increasing opportunities for residents to participate in local welfare could create new connections across generations and occupations.
The benefit would not flow only from younger people to older people.
Younger generations may learn from the experience of older people.
Local activities may create relationships between people who would otherwise never meet.
Human connection itself could become an important form of social value created by the system.
A Possible Approach to Sustainable Social Security
In an aging society, an important question is not only who will provide elderly care and welfare services, but also how their costs can be financed sustainably.
Taxes, social insurance premiums, and public expenditure will continue to be essential.
The Contribution Points System is not intended to replace them.
Instead, the proposal asks whether part of the fiscal savings generated by the system itself could provide the financial basis for future Contribution Point benefits.
There are two major potential sources of fiscal savings.
First Source of Fiscal Savings: Reducing the Cost of Peripheral Elderly Care and Welfare Tasks
Some tasks in elderly care and welfare require trained professionals.
Others do not necessarily require professional qualifications.
Examples include:
• cleaning
• serving and clearing meals
• washing dishes
• checking on residents
• providing conversation and companionship
• assisting with recreational activities
• helping with events
• shopping and other daily living support
If paid community welfare activities cannot attract enough local participants to meet demand, facilities, municipalities, or other organizations may need to fill the gap through:
• existing employees
• additional part-time or other employees
• temporary staffing
• outsourcing
This generates additional labor and outsourcing costs.
The Contribution Points System aims to create additional reasons for residents to participate.
Before the Contribution Points System
Insufficient participation in paid community welfare activities
↓
Necessary peripheral tasks must be covered by employees, additional hires, temporary staff, outsourcing, or other arrangements
↓
Additional personnel and outsourcing costs arise
After the Contribution Points System
New motivations to participate, connected with donations and future social security
↓
More residents participate in paid community welfare activities
↓
Appropriate peripheral tasks are performed by local residents
↓
Fewer tasks need to be covered through additional employment, temporary staffing, or outsourcing
↓
The overall cost of providing elderly care and welfare services may be reduced
An important point must be emphasized.
The objective is not to replace professional care work with cheap labor.
Rather, the aim is the opposite.
Professional workers should be able to concentrate on work that genuinely requires professional knowledge and responsibility, including:
• physical care
• dementia care
• medical coordination
• care management
• assessment of users' conditions
Local residents would support appropriately separated peripheral activities that can reasonably be performed as forms of community participation.
This could potentially achieve two objectives at the same time:
making more effective use of professional expertise,
and
reducing the overall cost of providing elderly care and welfare services.
Compliance with Labor Laws Is Essential
When paid community welfare activities are introduced, consistency with labor law is essential.
Even if an activity is described as “volunteering,” “community participation,” or by another name, if the actual working relationship legally qualifies the participant as an employee or worker, applicable labor laws—including minimum wage requirements—must be observed.
The Contribution Points System is not a mechanism designed to circumvent minimum wage laws.
Instead, it seeks to distinguish appropriately between work that should be performed under an employment relationship and activities that can legitimately be organized as community-based social participation.
The objective is to provide professional workers with appropriate compensation and working conditions according to their expertise and responsibilities, while expanding citizen participation in suitable non-specialized activities.
Through this division of roles and an increase in participation, communities may be able to provide welfare services more efficiently as a whole.
Second Source of Fiscal Savings: Supplementing Public Support Through Donations
The second potential source of fiscal savings comes from donations generated through activity compensation.
Before the Contribution Points System, some support for:
• disaster-affected communities
• children in need
• low-income households
• other social needs
may need to be financed through national or local government expenditure.
Under the Contribution Points System, participants could voluntarily donate part or all of their activity compensation to these causes.
As a result, citizen contributions may supplement part of the support that would otherwise require public expenditure.
However, this relationship should not be oversimplified.
A donation of 500 yen does not automatically mean that government expenditure can be reduced by exactly 500 yen.
Pilot programs and empirical research would be necessary to measure how much private social contribution actually supplements or substitutes for public expenditure.
Connecting the Two Sources of Fiscal Savings to Future Contribution Points
The fiscal logic of the Contribution Points System can therefore be summarized through two channels.
1. Savings in the Cost of Providing Elderly Care and Welfare Services
More residents participate
↓
Local residents perform appropriate peripheral care and welfare activities
↓
Fewer tasks require additional employment, temporary staffing, or outsourcing
↓
Personnel and outsourcing expenditures may be reduced
2. Savings Through Voluntary Social Contributions
Local welfare activity
↓
Compensation or honorarium
↓
Voluntary donation by the participant
↓
Support for disaster-affected areas, children, low-income households, or other causes
↓
Part of the public expenditure otherwise required may be supplemented
Then:
Fiscal savings generated through 1 + 2
↓
Part of those savings provides financial backing for future Contribution Point benefits
↓
Participants may use Contribution Points when they themselves later require elderly care or other eligible support
The important point is that Contribution Points are not intended to be issued without financial backing.
The basic fiscal principle is:
Use part of the fiscal savings generated by the system today to support future benefits.
How This May Differ from Financing Current Spending Through Government Debt
Suppose a government needs to finance social support today.
If that spending is financed through additional government borrowing, future taxpayers may ultimately bear both repayment of the principal and associated interest costs.
Contribution Points could also create a future public obligation if their value is guaranteed by the government.
They should therefore not be described as having no future fiscal cost.
However, they could have financial characteristics different from conventional government debt.
First, unused Contribution Point balances would not normally require annual interest payments in the same way that government debt does.
Second, not all Contribution Points recorded today would necessarily be redeemed in the future.
Third, the proposal assumes that fiscal savings are generated before or alongside the creation of future Contribution Point obligations.
Conceptually, it is therefore necessary to compare:
Fiscal savings from more efficient provision of peripheral elderly care and welfare tasks
+
Public expenditure supplemented or reduced through donations
+
Contribution Points that are never redeemed
with:
Contribution Points actually redeemed in the future
+
Administrative costs of the system
If, under appropriate conditions, the former is sufficient to support the latter, the Contribution Points System could create a fiscal structure different from simply financing today's expenditure through government debt.
However, this is not a proven conclusion.
Detailed financial modeling and empirical testing would be required.
The Basic Fiscal Principle
The central fiscal idea of the Contribution Points System is not:
“Create new benefits without funding them.”
Instead:
More people participate in the system
↓
The current cost of providing elderly care and welfare services may be reduced
And:
Part of the compensation generated by activities is donated to social causes
↓
Some public expenditure that would otherwise be required may be supplemented
As a result:
The system itself generates fiscal savings
↓
Part of those savings can provide financial backing for future Contribution Point benefits
Conceptually:
Current elderly care and welfare expenditures that can be reduced
+
Public expenditure that can be supplemented or reduced through donations
+
Contribution Points that are never redeemed
would need to be sufficient to support:
Contribution Points actually redeemed in the future
+
Administrative costs
If this can be achieved, the system may be able to advance several objectives without significantly increasing the long-term fiscal burden:
• increasing participation in local welfare
• reducing the burden on professional care workers
• improving the productivity of professional care workers
• supporting disaster-affected communities
• supporting children and low-income households
• strengthening local communities
• providing greater security for participants' own future social care needs
However, this remains a hypothesis that needs to be tested.
Detailed fiscal modeling and pilot programs would be essential.
How Contribution Points Differ from Ordinary Volunteer Points
Typical volunteer point programs often follow a simple structure:
Volunteer activity
↓
Points awarded
The Contribution Points System is different.
Local welfare activity
↓
Compensation or honorarium
↓
Voluntary donation
↓
Recorded social contribution
↓
Contribution Points
↓
Future social security
It is therefore not simply a system in which someone receives points because they volunteered.
Its distinctive feature is that it connects:
local welfare,
paid civic participation,
donations,
social contribution,
support for disaster-affected communities and other people in need,
fiscal savings,
and future social security
within a single mechanism.
A Participatory Social Security Model
The Contribution Points System can be understood as one form of participatory social security.
Traditional social security systems rely mainly on:
• taxes
• social insurance premiums
• other forms of public expenditure
These mechanisms will remain essential.
However, as societies age, it may become increasingly important not only for citizens to finance social security but also to participate directly in activities that help sustain it.
The Contribution Points System treats participation in socially valuable activities itself as an important social resource.
People contribute their time and effort.
That activity creates economic and social value.
Part of that value can support another person or community.
The contribution is recorded.
And it may later become part of the support available to the participant.
This creates a cycle of reciprocity across different stages of life.
From Japan to Other Aging Societies
Japan is one of the world's most rapidly aging societies.
But population aging and demographic change are not challenges faced by Japan alone.
Many countries may eventually confront similar questions:
• Who will support older people?
• How can shortages of care and welfare workers be addressed?
• How can younger generations be encouraged to participate?
• How can social security remain financially sustainable?
• How can loneliness and social isolation be reduced?
The Contribution Points System is one possible response.
It attempts to connect:
local welfare,
paid civic participation,
a division of roles between professional workers and local residents,
social contribution,
donations,
fiscal savings,
and future social security
within one social cycle.
What Needs to Be Tested Before Implementation
At present, the Contribution Points System is a policy proposal.
Turning it into a real public system would require careful testing and design.
Important issues include:
• which activities should be eligible
• how tasks should be divided between professionals and community participants
• how compensation or honoraria should be determined
• compliance with labor and minimum wage laws
• how much the system increases participation
• how much employment, staffing, and outsourcing expenditure can actually be reduced
• the amount participants choose to donate
• how much public expenditure donations actually supplement
• future redemption rates for Contribution Points
• administrative costs
• fraud prevention
• governance and funding arrangements
Pilot programs would be particularly important.
A municipality or a limited number of elderly care facilities could test the system on a small scale and measure:
• the number of applicants for local welfare activities
• the age composition of participants
• total participation hours
• the amount of professional staff time previously spent on peripheral tasks
• previous employment, temporary staffing, and outsourcing costs
• operating costs reduced after introduction of the system
• total compensation or honoraria paid to participants
• total donations
• the amount of public expenditure supplemented by donations
• future Contribution Point obligations
• administrative costs
The key comparison would be between:
the social and fiscal value created by the system
and
the new costs created by the system.
The proposal does not claim that its economic or fiscal effectiveness has already been proven.
Instead, it proposes questions that should be tested empirically:
How many additional people would participate if new motivations were created?
How much could greater participation reduce the cost of providing elderly care and welfare services?
How much professional staff time could be shifted from peripheral tasks to specialized, higher-value work?
How much social contribution and donation activity would be generated?
And how much of future social security support could ultimately be backed by the fiscal savings created by the system?
A Simple Principle
The principle behind the Contribution Points System is simple.
Help someone in your community today.
Use the value created by that activity to support people or causes you care about.
Preserve a record of that contribution.
And if you need support in the future, allow part of your past contribution to support you.
Helping others should not be seen only as an act of charity.
It can also become part of the social infrastructure that supports everyone.
The goal of the Contribution Points System is to transform mutual support into sustainable social capacity.
In short:
Help someone nearby.
Help someone farther away.
Help support your own future.
By connecting these forms of support, the Contribution Points System seeks to turn mutual assistance into a lasting social resource.
I hope this model can become one of the ideas Japan contributes to the global discussion about how aging societies can remain supportive, connected, and sustainable.
About the Proposal
Proposal name: Contribution Points System
Japanese name: 貢献ポイント制度
Proposed by: FMO-AOKI
Main themes: aging society, local welfare, elderly care, care workforce shortage, community care, paid local welfare activities, division of roles between professional care workers and local residents, disaster relief, support for children and people in need, social contribution, donations, fiscal savings, social security reform, sustainable social security, participatory social security, and intertemporal public finance.
Japanese version: 少子高齢化時代の地域福祉を支える「貢献ポイント制度」