Asia Pacific

Indonesia: Forward Thinking and Family Support: Explaining Retirement and Old Age Labor Supply in Indonesia (December 2006)
This report establishes a structural dynamic model of retirement for developing countries. Douglas McKee focuses on Indonesia for several reasons. It is the fourth most populous country and, like most developing countries, Indonesia faces huge demographic and socioeconomic changes. In this context, there is a lot of debate about the needs of an aging population and how best to change Indonesia’s pension system. This model takes into account health, family support, multi-sector labor market, and government pensions.

China: China Must Shore Up Pension for Ageing Society (December 12, 2006)
With the inevitable and rapid growth of its aging population, China has to find assets to finance a pension system. The government has just presented a “white paper” outlining programs for senior citizens. At the local level, the government urges increasing their budget devoted to social security, especially in the rural areas where no pension funds or other social protection covers older people. It also suggests using lottery proceeds and eventually attracting foreign investors in the pension system (see the white paper entitled: The Development of China's Undertakings for the Aged  ).

China: Audit Finds Massive Fraud in China’s Social Security Fund (November 24, 2006)
China’s National Audit Office cracked down on the latest government fraud related to the six-year-old social security fund. $900 million was misappropriated from the fund. Two months ago, a government investigation found a Shanghai party secretary guilty of misusing social security funds in Shanghai, which unleashed a chain reaction with the arrest of government and business leaders accused of stealing government funds or using them for bribery. The corruption involved more than $95 billion worth of government funds. This situation is affecting more than 220 million retired Chinese.

India: FM Asks for Reforms in Pension System (November 20, 2006)
As Finance Ministers from the G-20 countries gathered, many spoke about pension “reforms” as the next challenge for every country, whether they are developed or not. The Indian Finance Minister called for the implementation of defined-contributions plans, arguing that the “pay as you go” system is unsustainable. However, he faces tough opposition at home from the Left Parties in India who generally embrace a government-sponsored social protection model.

Wuxi, China: Elderly Not Covered Under Social Security Insurance Will Receive Elderly Pension (November 17, 2006)
(Article in Chinese)
The Wuxi government announced that starting from January 1, 2007, eligible elderly will receive 150 yuan ($19.00) elderly pension every month. Eligible elderly must fulfill the following 5 requirements: a)They must be citizens of Wuxi b) They must have obtained the Wuxi citizenship before April 30, 2003 b) They must have lived in Wuxi for more than 30 years c) They must be at least 60 years of age and d) They are not currently covered under any social security scheme.  

China, Nanjing: The Average Elderly Pension Has Increased 13 Times (November 3, 2006)
(Article in Chinese) 
The average elderly pension in Nanjing was 81 yuan ($10.30) twenty years ago. It has now become 1109 yuan ($141.00), the highest in the province.

Japan: Government to Give Yearly Payment Info on Pensions (October 26, 2006)
The government plans to inform workers, beginning at 20 years old, about the pensions they may expect to earn. Japanese workers will receive a letter from the pension fund that indicates: “the total amount of premiums paid in the past,” “the pension amount that each member is expected to receive in the future,” and “when they will start receiving their pension.” The Social Insurance Agency has already calculated the amount of benefits for the over-50s, which will help them to plan their life upon retirement.

China: The PRC Government’s Plan to Replenish the National Security Fund by Allocating Shares of Some State-Owned Enterprises (October 25, 2006)
(Article in Chinese)
The PRC government is considering allocating some state-owned shares of listed companies to the national social security fund, so that state-owned enterprises can be under greater market supervision. The plan is that when state-owned enterprises issue shares, 10% of the shares are allocated to the social security fund. The social security fund needs to be strengthened to deal with the aging population in China.

China: Guangdong Decreases the Elderly Pension Gap Between Regions (October 25, 2006)
(Article in Chinese)
Presently, the average monthly income of workers is used as the base number for the basic elderly pensions in each of the various regions in Guangdong province, creating a large gap of elderly pensions between different regions. The provincial government has just issued Document No. 96, which states that the base number of elderly pensions will be changed to the average monthly income of the workers within the whole province in the previous year.  This will increase the elderly pension level of some underdeveloped regions. There is a five-year transition period for this policy, from July 1, 2006 to June 30, 2011.

China: Top Statistician in China Scandal (October 19, 2006)
A financial scandal has hit the pension fund in Shanghai. Several officials such as the Head of China’s National Bureau of Statistics are suspected of “severe violation of discipline.” The Beijing government announced a general investigation in the country. As far as Shanghai is concerned, the authorities already know that the disappeared $1.25 billion was used to invest illegally in real estate and other ventures. 

China: China Braced for Pensioner Boom (October 16, 2006)
Because the pension system doesn’t compensate all older workers, the Shanghai government designates part of its budget to daily assistance for the elderly. Average life expectancy is equivalent to that of many developed countries. Policymakers hope that economic growth will help China care for its older people, estimated to be 30% of its population by 2025.

China: Management of Elderly Pension Will Be Centralized (September 27, 2006)
(Article in Chinese)
China is going to centralize its pension funds after Shanghai's Communist Party leader was sacked for diverting the social security fund of his city. The Ministry of Labor and Social Security may issue rules early next year to take away local governments’ control of provincial pensions. 

China: Average Elderly Pension Will Exceed 1000 Yuan for the First Time
(September 27, 2006)
(Article in Chinese)
The basic elderly pension in Nanjing will be increased by 145 yuan ($18.36). The average elderly pension in Nanjing is now 964 yuan ($122.00), after the increase, the elderly pension of retirees in Nanjing will reach 1109 yuan ($140.45).

China: China to Build Social Security System Commensurate with Reality (September 15, 2006)
China’s Minister of Labor and Social Security, Tian Chengping, has made headway in trying to address the payment pressures of the aging population. Chengping recently announced that the Chinese government has made “social security for more people” the primary goal and that coverage will be extended to workers in the non-state economic sector, workers in flexible forms of employment and migrant workers. So far, the central government has accumulated over 200 billion yuan (about 25 billion dollars) in their national social security fund as a strategic reserve.  

India: India Farmers' Joy at Pension Plan (September 13, 2006)
While only 12% of the Indian working population receives a pension, one of the biggest national investment companies has offered a chance to dairy farmers in the Bihar to get one. Economics influences the decision since the farmers belong to a powerful cooperative in which the company is investing. The farmers must contribute 100 rupees a month; then at the age of 58 they will receive a pension in return. 

China: Elderly Pension in Jiande Has Been Increased (September 13, 2006)
Jiande authorities increased basic elderly pensions by 67 yuan ($8.43) per month. In addition there is a 1.5 yuan ($0.18) increase for every monthly elder insurance payment. Those who attain a professional position in advance of the stated requirement, their elderly pension will increase by 60 yuan ($7.55) per month. Other professionals will receive 50 yuan ($6.29) more per month. For older men above 70 or women of 65 but below 80 years old, the elderly pension will increase by 1 yuan ($0.12) for every elderly insurance payment completed. For those 80 years or above, the elderly pension will increase by 2 yuan ($0.25) for every elderly insurance payment completed. 

China: Zhejiang Implements New Elderly Pension Policies (September 6, 2006)
(Article in Chinese)
The Zhejiang government has implemented new elderly pension policies. First, individual elderly pension accounts can be transferred from job to job. Second, the more you pay while working, the more elderly pension you will receive after retirement. Third, individuals, instead of only enterprise workers, can also buy elderly insurance.　　

Asia: Asia Facing its Fate (September 2006)
(Report in French)
Asia is becoming more similar to Western countries. The traditional family, based on wives’ care-giving support of parents and in-laws, is disappearing year by year. Asian countries will have to prepare for their aging populations and for financing their pension systems. Some countries rely on a strong economic growth thanks to their plentiful workforce so as to “become rich before becoming old.” Authorities, the International Monetary Fund (IMF) says, must implement a budget stabilization policy to be able to support future income support of older persons. Eventually, according to this International Monetary Fund report, two strategic choices arise for the Asian countries that are ending their demographic transition: increasing the birth rate and the retirement age.

China: Guangzhou Puts 70 Million Yuan as Elderly Insurance Reserve Fund
(August 28, 2006)
(Article in Chinese)
The rate of increase of transitional elderly insurance has to increase so that the living standard of retirees can catch up with the economic growth of the society. Right now Guangzhou has to pay basic insurance to 400-500 thousand retirees. There is pressure to pay the full amount of insurance on time. As a result, Guangzhou government is going to increase its contribution to the insurance reserve fund from 50 million yuan to 70 million annually, in order to deal with the payment pressure among the aging population in Guangzhou.

China: An Increase in Elderly Insurance of Enterprise Retirees (August 24, 2006)
(Article in Chinese)
Starting from July 1, the elderly pension of retirees in Ningbo went up; the average increase per person per month accounts for 100 yuan (approximately US $12). The increased elderly pension will be released to retirees before the end of September. The adjustment of the elderly pension is divided into two parts. In the first part, the elderly pension of retirees is increased by 62 yuan (US $7) per person per month. In the second part, the monthly adjustment depends how long retirees have collected payments. Pensioners will receive an additional 1.5 yuan (US $0.18 cents) for each year they have received pension payments.

China: Basic Elderly Pension of Retired Personnel in Beijing Shows an Increase of 120 Yuan per Month (August 17, 2006)
(Article in Chinese)
Starting July 1, 2006, the basic elderly pension of retired personnel in Beijing was adjusted with a 120 yuan (approximately US $15) increase in the aggregate average income. Those retirees who have paid into the program for more than 10 years will receive an additional 3.5 yuan (US $ 0.44), and those who have paid in for less than 10 years will receive additional 35 yuan (US $4.40) each month. Landless farmers who have paid in for less than 15 years will receive an additional 52.5 yuan (US $6.60) each month. Moreover, if the current pension for a high ranking technician, military officer or business owner is still below 1215 yuan (US $152), the government will bring the pension up to the $152 level. 

China: 6% Annual Increase of Retirees is Causing Social and Economic Pressure (August 11, 2006)
(Article in Chinese)
According to statistics released by the Ministry of Health, health resources consumed by elderly people are 1.9 times higher than the average population. In 2004, China’s basic health insurance expenditures increased 31.6% compared to the previous year. An aging population was the sole cause. The number of retirees in China expanded by 6%, and the deficit in the insurance fund increased. To deal with the increasing aging population predicted by specialists to peak in the year 2030, China needs to set aside 25 billion yuan (approximately US $300 million) as strategic reserve funds.

China: The Minimum Basic Elderly Pension in Hangzhou is Increased to 754.90 Yuan in 2006 (August 9, 2006)
(Article in Chinese)
The minimum basic elderly pension in Hangzhou (excluding Xiaoshan, Yuhang) has been increased to 754.90 yuan (about $95) in 2006. This is 13.7 yuan ($1.70) increase from 2005. In 2006, retirees whose pension amount is lower than this level will receive compensation.

China: Beijing: Funeral Expense Fund Included in Elderly Pension (August 8, 2006)
(Article in Chinese)
When Beijing workers die, their families receive 800 yuan (approximately $100) from the funeral expense fund. This year, the municipal labor and social security department plans to put funeral expenses under the authority of the old age pension system. In the past, workers’ units denied funeral expenses to families of deceased workers who got into disputes with the unit. Now the funeral expense fund is included in the elderly pension. It will guarantee payment of funeral expenses and more than 1.5 million workers will be benefit from the policy. 

China: Different Retirement Pensions for State-Owned Enterprises and Public Institutions Retirees (July 28, 2006)
(Article in Chinese)
It is a common to see a big difference between the retirement pension of enterprise retirees and that of public institutions’ retirees. Since 1993, state-owned enterprises and public institutions have adopted different wage rate systems; state-owned enterprises adopted a basic uniform socialized pension system, whereas public institutions adopted an independent civil servants wage system, and thus the gap between their incomes has increased. Usually retirees of state-owned institutions receive much lower retirement pension than retirees of public institutions, even in the cases when they had the same wage before retirement. However, it is mainly the retirees of state-owned enterprise who suffer from lower retirement pensions. Since there are now more and more private enterprises in China, they have introduced a higher wage system and retirement system to attract talented persons. Or, Global Action on Aging would ask, if the private sector is pressuring the government to keep taxes low and thereby starving the public sector, including its pension system.

China: 20,000 Retirees Stop Receiving Retirement Pensions Starting Next Month (July 27, 2006)
(Article in Chinese)
From May 8 to July 18, Chengdu launched the validation of retirement pension eligibility. Some 20, 000 retirees didn’t get the necessary validation procedure done before July 18 and hence they will not be able to receive their retirement pension beginning next month. For those retirees who haven’t done the validation process, they have to bring their identity cards, social security card and “Chengdu retirees’ social security contact card” issued to them in 2005 to the social security office in their residential area and undergo the validation procedure. Those who are eligible will continue receiving their retirement pension starting next month. 

China, Macau: Macau Increases 3 Social Security Pensions (July 25, 2006)
(Article in Chinese)
Starting from August 1, 2006, the elderly pension and disability “consolation” pension in Macau will increase by 300 Macau Patacas (MOP) (US $39), to MOP 1450 (US $188). The social security pension will increase by MOP 200 (US $26), to MOP 950 (US $123). The percentage increases for all three social security pensions’ amounts to a 26% hike.

China: Shenyang Changes Industrial Injury Consolation Pension to Basic Elderly Pension (July 25, 2006)
(Article in Chinese)
Workers that sustained level 1- 4 industrial injuries before December 2003 will undergo a special retirement process, first receiving an industrial injury “consolation pension.” If a “consolation pension” is below Shenyang’s lowest income level, the compensation will be raised to that level. However, from July 1, 2006 those workers will then have to retire at the normal retirement age, at which time they will receive the basic elderly pension. If retirees have a basic pension less than the “consolation pension,” the Industrial Injury Pension Funds will make up the difference. 

China: Guangdong landless farmers will be covered under elderly pension system
(July 19, 2006)
(Article in Chinese)
Guangdong’s landless farmers will be covered under basic elderly insurance before the end of this year. As the urbanization of China has proceeded, the government has taken the land of nearby farmers, rendering them “landless.” According to National People’s Congress research, about 120 million of farmers and landless farmers in Guangdong were covered under elderly pension system until the end of 2005. But the pension covered less than 60% of the farmers in Guangdong. In fact, the percentage of farmers covered was the lowest in the country. This situation created great hardship and social unrest among those landless farmers who have no pension. Now the government will give landless farmers an elderly pension system before the end of year 2006 so that they can maintain a basic standard of living.

China: Yichang Social Security Department Implements Fingerprint Authentication Technology (July 15, 2006)
(Article in Chinese)
In order to manage the release of social security funds more effectively, Yichang Social Security Department implemented a fingerprint authentication technology. The identity of the retired personnel who joined the social security insurance has to be verified by the identification system, or else the system is going to stop the release of their pension automatically. According to Yichang Social Security Department, since 2004, the identity of 210 dead retired personnel were stolen; 115 million yuen were lost under identity fraud, of which 300,000 yuen have been recovered.

India: National Old Age Pension Increased To Rs.200 (July 13, 2006)
India has a National Old Age Pension scheme as part of wider National Social Assistance Program. A means-tested program, it targets only those who are the most destitute. On July 13th, the Union Cabinet increased the amount of the monthly pension for each beneficiary from 75 Reupees (US$ 1.6) to 200 Reupees (US $ 4.3). The officials expect that the larger amount will help old and poor persons to manage their livelihoods better. 

China: 1.46 Billion Yuan Misappropriated Elderly Pension has been Recovered (July 7, 2006)
(Article in Chinese)
In 2004, the Municipal People's Congress in Guangzhou launched a public inquiry and reported the alarming news that the Social Security Organization had misappropriated 8 billion yuans in elderly pensions. The Guangzhou Labor Department has announced that they have recovered 1.46 billion (approximately $183 million) of the misappropriated pensions. The government is going to increase its contribution to the pensions so that the elders’ pension checks will not change.

Background: In 1993, Labor Department Document 107 allowed Social Security Organizations to invest their funds in the financial markets, provided they had enough funds for their operational costs. At that time, the Social Security organizations under the Labor Department moved 8 billion yuans (approximately $1 billion) as the operation fees to the corporations under them. In 1994, the Labor Department and the Financial Department issued a document which banned the flow of Social Security funds to the market and stated that the misappropriated funds have to be recovered. In 2000, the Labor Department and the Social Security Department set up a debt collection team to recover the misappropriated funds. 

China: Flexible Employment Pension Monthly Minimum Payment Is Increased (June 30, 2006)
(Article in Chinese)
In Nanjing, the minimum monthly payment for a flexible employment pension has increased from 207 yuan (approximately $25) to 244 yuan (approximately $30). Flexible employment means those who are self-employed, who own their own business or those who engage in personal economic activities. The Labor and Social Security Bureau sets a base number for the minimum pension. The flexible employment pension is calculated by multiplying the base number by 20%. Because the Labor and Social Security Bureau adjusted the base number upward for 2006, starting July 1, the flexible employment pension minimum payment will be increased to 244 yuan. 

Malaysia: Call For Old-age Pension for Citizens (June 25, 2006)
A famous activist, Datuk Seri Ang Lai Soon, talks about the need to implement social pension programs. According to him, a large portion of older adults in Malaysia have either very limited income or no savings at all and therefore face financial difficulties. Ang believes that Malaysia will be able to afford the program as it has abundant natural resources. He says, "I don't think it is too much to ask that the elderly be treated with respect and be provided with the means of living out the autumn of their lives in a comfortable, secure and pleasant environment.”

China: Elderly Pension Inquiry System Launched (June 24, 2006)
(Article in Chinese)
The Ningxia elderly pension inquiry system was launched on June 23, 2006. The elderly pension inquiry system installed a special elderly inquiry hotline that can be used district-wide. The hotline offers current information on older persons’ pensions for employed and retired employees, on pension policies and on payments of elderly insurance.

Bangladesh: Allowance for Elderly Poor in City Planned (Jun21, 2006) 
The Bangladesh government is paying more attention to the socio-economic well being of older adults in rural areas. The social safety net allowance will now expand for those in urban areas. Finance and Planning Minister Saifur Rahman said, “Now we want to do something for the very poor people living on footpaths and railway stations.” The budget for fiscal year 2006-2007 proposed an increase for the safety net allowance, as well as an increase for the number of beneficiaries.

Malaysia: Gone Within Three Years (June 18, 2006)
Many Malaysians believe that the Employees Provident Fund (EPF) is their savings account. Despite the belief, a recent study claims that nearly 70% of retirees use up their EPF funds within the first 3 years of their retirement. In other words, many retirees do not have much money left by the 4th or 5th year into their retirement. For many older adults without filial children or caring families, their lives after retirement will be difficult. 

New Zealand: NZ Better Positioned for Aging of Population (June 7, 2006)
“The United Nations estimates that by 2050 the median age will increase by 10 years to 38,” meaning that the population in general will become older. According to the report of the Credit Ratings Agency “Standard and Poor,” New Zealand’s welfare system is more prepared for the impact of aging population than many European countries. 

China: Xiamen Asks for Pension Eligibility Certification (May 18, 2006)
(Article in Chinese)
Starting from May 18 to July 25, retirees not under social management in Xiamen must certify their pension eligibility. If the Xiamen social security authorities don’t receive the certification they will suspend the pension payments to retirees beginning in August. The measure aims to prevent pension forgery. 

China: Dignity for All in Retirement (May 15, 2006)
(Article in French) 
Critics and legislators call for the implementation of a universal retirement protection for the aged. The present system discriminates against low-income groups, housewives and the unemployed. The number of seniors claiming social security has surged over the past two decades. As Hong Kong's population rapidly ages, a comprehensive pension funding scheme is ever more necessary. Though boasting a $14 billion (11 billion euros) surplus, the government is reluctant to implement pension schemes that might prove to be unpopular with middle-class voters.

China: Hard Times Ahead for Chinese Retirees with Little Income (May 3, 2006) 
(Article in French) 
China is aging at pace that is far superior to its growth and development rates. The consequences in the long term are worrying both population experts and rural families, lacking social security. By 2013, China is expected to experience its first staff shortages, placing it well behind countries with younger population such as India. Projections show that Chinese older persons will retire without the support of a social security system, earning only a third of Japan’s present day per capita income. 

Hong Kong: Elderly Aid Complies with International Standards (April 26, 2006)
In Hong Kong, the Health, Welfare and Food Bureau states that the current social security system adopts international standards set by the World Bank. The Bureau is critical of a proposed universal pension system since many other countries are beginning to forsee problems with the pay-as-you-go system. Hong Kong’s government reiterates its concern for the well-being of older adults, yet urges families to assume responsibility for their elders. Global Action on Aging believes that both the state and families should address the needs of older adults.

Maldives: Social Protection in the Maldives: Options for Reforming Pensions and Safety Nets (April 25, 2006)
In this report the Asian Regional Unit of the World Bank presents a comprehensive study on social protection and pensions in the Maldives. Although these islands have performed formidably well in terms of economic growth, there are many Maldivians—especially women and older persons—who live in poverty. Supported by household surveys and administrative data, this report aims to assist the Maldivian government in reforming the social protection and pension system. 

Japan: The Pre-kin Generation Coming of Age at Work (April 24, 2006) 
(Article in French) 
Japanese women who started working before the implementation of the equal opportunities law in 1986 are known as pre-kin women. They now face retirement. This generation of women pushed for the rights of women in a male-dominated society. Younger generations of women enjoy the benefits of their victories. In their move towards retirement, they are reassessing their achievements.

China: Beijing Ministry of Labor & Social Security: The Basic Insurance Premium of Old-Age Pension Is Increased (April 11, 2006)
(Article in Chinese)
The Department of Labor and Social Security of Beijing announced that starting April 10, 2006, the average premium for retirement pensions, unemployment protection, compensation for work-related injuries, and basic medical insurance will increase from 2362 RMB to 2734 RMB (about US$303 to US$350). The lower limit of the premium will move from 1417 RMB to 1640 RMB (about US$182 to US$210) and the upper limit of the premium will move from 7087 RMB to 8202 RMB (about US$909 to US$1051).

China: Reversal Mortgage: Robbery or Reform? (April 11, 2006)
(Article in Chinese)
Home Mortgages have become a widely accepted means of personal financing in China, but what about reversal mortgages (RM)? Some experts believe China does not now have sufficient regulatory environment to support this kind of financing. First, according to the Civil Law, rural real estate can not be traded or loaned, which is an essential prerequisite for RM. Secondly, financing life after retirement is largely considered as part of social welfare, a public service. Therefore, public funding should be a major financial source. Thirdly, from the perspective of commercial banks, RM may be profitable, but it is also a very risky financial product. 

India: Pension Deal Approved, India Bank Strike Ends (April 11, 2006)
State Bank of India workers ended a strike they began on April 3, 2006, after government announced a pension arrangement. The deal creates a two-category system. Employees who made up to 21,040 rupees, or $471, as their last monthly salary, will receive 50 % of this amount as a monthly pension. Employees who earned more will receive a 40% pension.  

China: Dalian Encourages Home-Stay Retirement (April 10, 2006)
(Article in Chinese)
In order to solve the retirement problem of low income elderly and the unemployment of woman workers, Dalian has encouraged “home-stay retirement” since 2002. The Civil Administration and the Housing Department arranged for unemployed woman workers in the community to care for older persons who spend their retirement at home. In this way, elderly can get care and unemployed woman workers can earn a stable income. The “123” Policy that provides income adjusted assistance drives the system. For example, the district government provides a 300 RMB old-aged pension for those retired without any income while those who earn more than 1200RMB have to pay for their own retirement service.

Japan: Firms Should Honor Law on Employing Elderly (March 20, 2006)
Although Japanese corporate workers usually retire when they turn 60, a revised law will eventually require corporations to keep workers on their payroll until age 65. The amended law will help secure employment for older persons as well as attempt to complement changes made to corporate employee pension plans. The retirement age needs to be raised to 65 by 2013 because the starting age for pension payments will be moved from 60 to 65 beginning the same year.

China: China’s Northeast Points Way to Pension Reform (March 12, 2006)
According to statistics, China is aging fast. The pilot social security program in Northeast China demonstrates the government moving away from a pay as you go system to one that uses private accounts. The transition costs may be difficult to sustain. GAA wonders if US based financial firms are watching the process with an interest in managing the private accounts. For the moment, at least one near-retiree believes that private accounts will serve him well. Li Xianglin, a 52 year-old Chinese man said, “When I retire, I’ll be comfortable.”

China: Three News Reports on Chinese Elderly Related Issues (February 28, 2006)
(Article in French)
The First National People's Congress released official guidelines on pension subsidies. Essentially, current retirees will keep enjoying the same subsidy while future retirees will access the new subsidy. In addition, an official report “Prospects on China Elderly in the Next Century” was released recently. According to the report, China will experience the increasingly pressing issue of an aged population in the late 21st century. In the meanwhile, Guangdong Province plans to set up programs improving the quality of life for the elderly in the near future.

South Korea: National Pension Plan Has ‘Blind Spots’ (February 14, 2006)
The National Assembly’s Special Committee on Pension Reform says that the current problems in the National Pension System are the issue of “unstable finance” and its “blind spots.” In order to correct these problems, these two issues need to be resolved. Statistics show that one-third of those who qualify for pensions are not enrolled and are low income persons. The current pension system requires workers to make small contributions now for big returns in the future. Jeong Gyeong-bae, who is the head of the Korean Welfare Economy Research Institute, suggests a “minimum pension system” to provide minimum benefits even for those that cannot afford to make the monthly contributions. 

China: More on the Pension Reform (February 9, 2006) 
Labor relations experts have demonstrated the long term benefits of the new pension reform. First, many believe that current retirees will not be affected by the changes. Second, the change will create Individual Accounts in real terms, i.e., the more money that employees deposit, the more benefits they will get in return upon reaching retirement. In addition, minimizing individual accounts by reducing individual deposits from 11% of their wage to 8% will further strengthen the adjustment power of the Basic Accounts pension. The government will be able to allocate funds better to where it’s needed the most. 

China: Shanghai to Commercialize Pension System (January 26, 2006)
(Article in Chinese)
Shanghai is reportedly going to privatize part of its local pension system. Starting from February 2006, the new pension plan will be consist of two components, a basic account and a personal account. Benefits from the basic account will correspond directly to years of employment. The private sector will manage the personal accounts through commercial offerings; the rate of return is expected to hit 4 percent. 

China: The Aging of China Changes the Standards of World Economic Growth (January 25, 2006)
(Article in Arabic)
While the transition to an aging population took 115 years in France, 60 years in the United States, and 45 years in Great Britain, China will experience its demographic change in only 18 years. Experts predict that China’s demographic shift will have an strong effect on the global economy. By 2010, China will have to reserve $800 billion for its pension system. At that point the United States will no longer benefit from the money coming from China’s imports of US products. 

China: Pension Reform Expedited and Expanded (January 23, 2006)
(Article in Chinese)
On Jan. 19, the spokesperson at the Ministry of Labor and Social Security’s fourth quarter press conference announced that a total of eight cities and provinces including Tianjin, Shanghai, Shan’xi, Shandoing, Henan, Hubei, and Xinjiang will be test implementing the new Pension System, expanding the total number of test provinces up to 11, eight more than what was under the tenth “Five Year Plan.”

India: India to Get Its Own Social Security System (January 22, 2006)
The government of India is currently working on a bill to promote the care, maintenance and protection of senior citizens. The National Council for Older Persons and several other NGO’s have helped the government develop its program. The new system will offer services, such as an old age pension, minimum level of financial security, old age home in each district and well-equipped wards in each hospital.

China: New Pension System to Be Fully Implemented by the End of This Year 
(January 20, 2006)
(Article in Chinese)
According to spokesperson from Ministry of Labor and Social Security on Jan 19, the new pension system is expected to be fully in place nationwide by the end of this year. In the meanwhile, individual accounts need further refinement in eight additional test cities and provinces, including Tianjin. The spokesperson said the main reason for the reform is to encourage more individual deposits and connect benefits to the length of enrollment. 

China: What’s New with New Social Pension Fund Regulations? (January 12, 2006)
According to the new social pension regulations, starting in Jan. 1, 2006, an individual’s share of the pension contribution continues to amount to 8% of his or her annual salary. The employer’s share, despite being the same, will now be collected and managed by relevant social pension agencies. Under the current system, the government pays retirees’ pensions out of basic accounts to which employers contribute. However, a chronic shortage of basic account funds has led social pension agencies to borrow from personal accounts, which were originally designed as a reserve fund to deal with future aging challenges. The new system will attempt to leave the personal accounts untouched.

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Europe and Central Asia
 

France: A Small Improvement of the Low Agricultural Pensions (December 31, 2006)
(Article in French)
As President Chirac announced in October, farmers’ pensions will be raised beginning January 2007. The change would lower the number of years required to have a “complete” career and to deduct less money for each “missed” year. Some 300,000 French farmer-pensioners should receive an income raise, which is essential since many of them earn less than the old basic income.

France: A Bonus for the Civil Servants in the Departments Outside Metropolitan France Will Be Maintained (December 5, 2006)
(Article in French)
The French Senator, Jean Arthuis, proposed for the fourth time to abandon the pension system for civil servants working outside Metropolitan France. Besides heavenly living conditions (in the Caribbean or in Polynesia), they benefit from larger pensions. Implemented in the 1950s, this measure served to spur civil servants to go and work in the colonial Empire, which was a difficult posting at that time. Nowadays this system ruins the local authorities and is misused, claims the Senator.

Georgia: Georgian Pensioners Won’t Receive Differentiated Pensions This Year (December 5, 2006)
(Article in Russian)
Social Security Fund administrators of Georgia announced that this year Georgian pensioners still won’t receive pensions, reflecting the number of years they worked and their job descriptions. Unofficial sources claim that the Georgian government purposefully postponed pension changes in order to launch it on the eve of new presidential elections in 2008.

European Union: EU Pension “Maze” Costs Jobs – Aegon Study (December 4, 2006)
While Europeans have the best social protection in the world, multinational firms want to change it. The corporations are looking for ways to shift from defined-benefit to defined-contribution schemes. European institutions should quickly respond to this dangerous challenge. Workers face the risk of having multinational firms impose their own integrated cross-border corporate pension systems that national governments could no longer control.

Spain: The Judge Denies Pension to a “Househusband” after a Homosexual Divorce (December 2, 2006)
(Article in Spanish)
Joaquín Valdeolivas and V.T. were married and Valdeolivas was the househusband. When V.T. divorced Valdeolivas, Valdeolivas demanded a pension of 1,200 euros in addition to 30,000 euros for all the housework he did during the marriage as well as the work he did for V.T.’s business. However, a judge denied this request and offered another financial solution.

Ireland: Old-Age Pension Likely to Increase to €208 (November 30, 2006)
Eighteen percent of the Irish population has reach 65 years or older. In the near future the “grey” vote will become more influential in the general elections. As a result, politicians have begun to look at the well-being of the elderly, making aging concerns an important part of the next political campaign. The Irish government strategy supports more spending on health care. Contributory and non-contributory pensions are going to increase. Officials plan to budget for providing more nursing homes and home health aides.

Sweden: Swedish Blue-Collar Workers Want White-Collar Pensions (November 28, 2006)
Following the elections in October, the new government and Prime Minister must face their first challenge. Blue-collar workers claim the same defined-contribution pension scheme that the white-collar employees obtained recently. Employer contributions rose from 3.5% to 4.5%. Blue-collar employers stopped talks with unions; they refuse to raise contributions while wages are being negotiated.

Sweden: Sweden Mulls New Pension Admin Body (November 20, 2006)
A legislator proposed to create a new authority that could administer both the Premium Pension Authority (PPM) and the pay-as-you-go income related state pension. This authority would be efficient due to its centralization: it would have a better overview of the national pension system. Yet the current state pension’s administration opposes this proposal saying that its local offices provide services and information to pensioners. This is an old debate about centralization. Which program will serve older people better?

Cyprus: Cyprus Passes Pension Fund Law (November 20, 2006)
Cyprus voted for a bill to establish national pension funds. The government wants to encourage the use of financial instruments and investments in stock exchange investments. The EU pension directive strongly urges governments to move in this direction. Other new EU members will likely follow this path to accelerate their integration into the union.

Russia: Pension Fund Workers Embezzled 5 Millions Rubles (November 18, 2006)
(Article in Russian) 
The court in Bashkiria found four workers guilty of robbing the Pension Fund with a simple scheme that deceived the State and pensioners. They created fraudulent documents, claiming that they had received less money for pension payments than what was paid out in reality. The criminals pocketed the difference between the real amount of received money and what was paid to the pensioners. It is not the first time that the police have discovered fraud involving pension money. Nobody knows how many criminals are out there, buying houses and jewelry while poor older people do not have enough to buy a loaf of bread. 

Russia: No Match… (November 13, 2006)
(Article in Russian)
According to the data provided by the Head of the Pension Fund, Gennady Batanov, pensions in Russia increased by 11 percent over the past 9 months. However, real life is far less rosy. Today the average pension amount in Russian is 2,877 Russian rubles (USD 106), while the minimum pension is 1000 rubles (USD 37). Unlike the authorities from the Pension Fund, people believe that they should receive at least 8,720 rubles (USD 322) to have a decent income.

Russia : The Destiny of the Premium (November 11, 2006)
(Article in Russian)
According to the article, Yekaterinburg pensioners hope that they will receive a municipal premium with their pension next year. The chairman of the local Duma said that the legislature will try to pass a bill, granting such a premium to pensioners. He also said that the realizing the premium depends mainly on the region’s budget.

Scotland: Workplace Pensions 'Could Be Cut' (November 10, 2006)
A major reform might implement a personal account system in Scotland. Employers, workers and State would have to contribute to this account. However this proposal is criticized as a “leveling down” since many companies with the current system contribute far more than 3%.

UK: Government Employment Strategy Not Challenging Enough (November 8, 2006)
At the Work & Pensions Select Committee evidence session, Patrick Grattan, the Chief Executive of TAEN, gave striking evidence to support his statement that the Government was not doing enough with labor and pensions. Based on the evidence, dictated in the report, Grattan suggested what the Government should do to improve its performance. Some of them were: rigorous assessment of the relevance of the National Default Retirement Age of 65 and a more ambitious Public Sector Agreement for the Department of Work and Pensions to name a few.

Ukraine: “Soon Every Pensioner Will Get About $100” (November 6, 2006)
(Article in Russian)
The President of Ukraine said that “Soon every pension will get about $100,” at an award ceremony for social workers. He also promised to change the social care policy so that those who need social help will indeed receive it. Unfortunately, these statements litter political life. Older persons only hope that one day the promise will come true.

European Union: Portugal Spending More Citizens’ Social Protection (November 4, 2006) 
Eurostat, the EU statistics office, assessed how much States spend on their social protection. Sweden and France, respectively, top the list with 33.5% and 30.9% of their gross domestic product (GDP). Portugal spends 24.3%of its GDP, old age pensions accounting for the major share of benefits paid out. The average expenditure on social protection in the 15- member states is 28%of the GDP, compared to 23.8% in the US. The new EU members from Eastern Europe are reaching the same rates.

Russia: Pensioners in Belgorod Have to Buy Free Medication (November 2, 2006)
(Article in Russian)
Last year pensioners had to choose whether they wanted social benefits or monetary compensation as their pension. Many chose benefits and lost, it appears. Despite government promises, free medication is not available at pharmacies. Left without a choice, pensioners are forced to buy medication that they should have received for free. 

Czech Republic: Pension Pinch (November 1, 2006)
The European Commission, the World Bank, Standard & Poor’s and the Organization for Economic Cooperation and Development warned that the Czech Republic’s pension system is about to be insolvent. Today the State can guarantee pensions worth nearly 41 percent of a person's gross salary, but it won’t be able to afford those in a couple of years. Yet no political party proposes reform; it is too politically dangerous.

France: Deputies Exempt Taxes on Compensation to a Retired Employee (November 1, 2006) 
(Article in French)
Deputies voted an amendment to the 2007 bill for Social Security financing against the advice of the Social Security Secretary and in opposition to the government’s efforts to extend the working life of employees. The amendment exempts retirement compensation from taxes, pushing employees to retire earlier. French politicians have conflicting goals about the employment of persons over 50: what is the point of maintaining those retirement advantages while the pension system debt is growing? 

France: Is It Useful to Sign on to a Pension-Investment Plan? (October 29, 2006)
(Article in French)
One of the French pension-investment plans, launched in the 2003 reform, has had troubles finding customers. Since the end of the year is always more favorable to sign on to a pension-investment, banks and insurance companies will emphasize this financial product during the coming weeks. The French government considers these investment plans as a way to strengthen savings for retirement. It has asked companies to inform potential customers of the risks of such a purchase.

Germany: German Government Agrees to First-Pillar Reform (October 26, 2006)
The German coalition government, whose electorate was waiting for its first reforms on social field, has just tackled the pension issue. The requirements for the new state pension system, effective from early 2007, will be harder to meet. The retirement age will be raised to 67 years old, and people will have to pay contributions for 45 years at least to be eligible for a full-benefit. The full-pension itself will be reduced to 46% of former salary, while the contributions will increase. The standard of living, upon retirement, appears lower for the future generations.

Serbia: Five Percent Set Aside for Private Pensions (October 26, 2006)
This article describes a survey on the population of new EU members. Most workers don’t set aside -- or cannot afford -- enough money for their pensions. They must count on improvements in the state pensions system to increase their future pensions, otherwise lots of these Europeans will fall below the poverty line.

Italy: Pension Accord Signed (October 23, 2006)
Government, unions and employers signed an agreement with a view to changing the Italian pension system. It’s a first step to restructure the stagnant economy. All severance funds will be transferred to the State. This will give new resources to the state pension fund. It will also offer more guarantees to the workers instead of putting their money at risk in a fund held by a company that could use it as cheap financing.

European Union: Youths from the South Guarantee Secure Retirements (October 19, 2006)
(Article in Spanish)
Low fertility rate translates into shortages of retirement funding. As the European Union gets older and with fewer contributors to social security, the young immigrants are the ones who save the day. At the Sixth International Conference on Migration, held in Lisbon, the economic and social specialists of the United Nations show that immigrants play a big role in securing retirement income for the next two or three generations. Research confirms that the possible crisis with the social security situation has been avoided thanks to the thousands of immigrants from the South. Will this make the EU relax its restrictive immigration laws?

UK: Mothers 'Throw A