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Second Pillars : Provider and Product Selection for Funded Individual Accounts

Autor: Banco Mundial
Año: 2005
Resumen: There are many ways to structure mandatory private pension funds that rely on individual accounts. As in any market there are products and firms that provide them. Both are typically circumscribed by the government for public policy reasons. Relevant legislation will specify the agent responsible for making key choices as to who manages the money and where it is invested. As discussed below, the focus of decision-making in funded schemes varies widely with potentially important implications for the performance of the scheme. In the context of mandated private pensions, this note looks at what investment and withdrawal products can be offered, who can offer them, and who chooses from among the alternatives available in this market.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Informes
Idioma:

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Ageing and Poverty in Africa and the Role of Social Pensions

Autor: Kakwani, Nanak; Subbarao, Kalanidhi
Año: 2005
Resumen: In many low income African countries, three factors are placing an undue burden on the elderly. First, the burden on the elderly has enormously increased with the increase in mortality of prime age adults due to HIV AIDS pandemic and regional conflicts. Second, the traditional safety net of the extended family has become ineffective and unreliable for the elderly. Third, in a few countries, the elderly are called upon to shoulder the responsibility of the family as they became the principal breadwinners and caregivers for young children. While a number of studies have examined the welfare consequences of these developments on children, few studies have systematically analyzed the poverty situation among the elderly (relative to other groups) in low income countries Africa, and the role of social pensions. This study aims to fill this gap. Drawing on household survey information, the study profiles the elderly for 15 African countries which include both East and West African countries, and countries with a high and low prevalence of HIV-AIDS pandemic. The findings show much heterogeneity across countries with respect to the proportion of the elderly population, the living arrangements and the composition of households, and household headship. The variations in household types and living arrangements presumably reflect the variations in, and changing character of, the traditional family support system and household coping strategies in the wake of covariate shocks and the HIV-AIDS pandemic. However, the proportion of the single elderly is still very small in most countries. A household type "elderly and children" or what is known as "skipped generation household" has emerged as an important structure in some countries. In addition, "households headed by the elderly" has also emerged as a significant household type in several countries. The analysis shows that the poverty situation, and especially the poverty gap ratio, for the household types the elderly only, the elderly with children and the elderly-headed households is much higher than the average in several countries and the differences are statistically significant.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Documentos de Trabajo
Idioma:

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Aging and Poverty in Africa and the Role of Social Pensions

Autor: Subbarao, Kalanidhi
Año: 2005
Resumen: In many low income African countries, three factors are placing an undue burden on the elderly: 1) the burden on the elderly has enormously increased with the increase in mortality of prime age adults due to the HIV-AIDS pandemic and regional conflicts; 2) the traditional safety net of the extended family has become ineffective and unreliable for the elderly; and, 3) in a few countries, the elderly are called upon to shoulder the responsibility of the family as they became the principal breadwinners, and caregivers for young children. While a number of studies have examined the welfare consequences of these developments on children, few studies have systematically analyzed the poverty situation among the elderly (relative to other groups) in low income countries in Africa, and the role of social pensions. This study aims to fill this gap. The findings show much heterogeneity across countries with respect to the proportion of the elderly population, the living arrangements, and the composition of households, and household headship. The analysis shows that the poverty situation, and especially the poverty gap ratio, for the household types the "elderly only", the "elderly with children" and the "elderly-headed households" is much higher than the average in several countries, and the differences are statistically significant. The analysis further shows that the fiscal cost of providing a universal non-contributory social pension to all of the elderly will be quite high - 2 percent to 3 percent of GDP, a level comparable to, or even higher, than the levels of total public spending on health care in some countries. While categorical targeting of a pension for the above groups yields the maximum poverty reduction impacts, and is also fiscally sustainable even in low income countries, its operational feasibility is considered to be weak. The study concludes that the case for a universal approach is weak. The best option appears to be to target the pension only to the poor among the elderly, keeping the benefit level low. The study underscores the need for more country-specific work to explore the feasibility of the recommended option in diverse country settings.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Informes
Idioma:

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Taxation: The Tax Treatment of Funded Pensions

Autor: Whitehouse, Edward
Año: 2005
Resumen: The tax treatment of funded pensions is a critical policy choice in pension reform. In countries with mature funded systems, like the Netherlands, Switzerland, the United Kingdom and the United States, pension funds are worth 85 per cent of GDP on average. Pension funds in mature systems are large and could prove an attractive revenue target. They are a major force in private savings flows, supplying capital to industry and providing retirement incomes. The note continues with an in depth analysis of taxing pensions, and further, highlights the question, how generous a tax treatment? There are three arguments for taxing pensions more generously that other kinds of savings. a) to ensure people have a standard of living in retirement close to when they were working, b) to cut the cost of social security benefits for pensioners, and to increase long-term savings. The note concludes that : the 'expenditure tax' taxes pension savings once, either when contributions are made or benefits withdrawn it is the best way of taxing pensions, because it is neutral between consuming now and consuming in the future; most countries treat pensions close to the expenditure tax, the pre-paid tax, which exempts benefits, collects more revenue now, but may not be credible.

Fuente: Banco Mundial
Clasificación: Seguridad Social y Sistemas de Pensiones
Tipo de Publicación: Informes
Idioma:

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Financial Literacy and Planning: Implications for Retirement Wellbeing

Autor: Annamaria, Lusardi; Mitchell, Olivia
Año: 2005
Resumen: Only a minority of American households feels "confident" about retirement saving adequacy, and little is known about why people fail to plan for retirement, and whether planning and information costs might affect retirement saving patterns. To better understand these issues, we devised and fielded a purpose-built module on planning and financial literacy for the 2004 Health and Retirement Study (HRS). This module measures how workers make their saving decisions, how they collect the information for making these decisions, and whether they possess the financial literacy needed to make these decisions. Our analysis shows that financial illiteracy is widespread among older Americans: only half of the age 50 respondents could correctly answer two simple questions regarding interest compounding and inflation, and only one-third correctly answered these two questions and a question about risk diversification. Women, minorities, and those without a college degree were particularly at risk of displaying low financial knowledge. We also evaluate whether people tried to figure out how much they need to save for retirement, whether they devised a plan, and whether they succeeded at the plan. In fact, these calculations prove to be difficult: fewer than one-third of our age 50 respondents ever tried to devise a retirement plan, and only two-thirds of those who tried actually claim to have succeeded. Overall, fewer than one-fifth of the respondents believed they engaged in successful retirement planning. We also find that financial knowledge and planning are clearly interrelated: those who displayed financial knowledge were more likely to plan and to succeed in their planning. Moreover, those who did plan were more likely to rely on formal methods such as retirement calculators, retirement seminars, and financial experts, and less likely to rely on family/relatives or co-workers.

Fuente: Wharton University of Pennsylvania
Clasificación: Ahorro Previsional
Tipo de Publicación: Artículo Académico
Idioma:

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