By Sarah Touahri, Magharebia in Rabat 

Morocco

March 30, 2008

Facing demographic change in Morocco, the long-term solvency of pension funds is at risk. The ratio of people working to those in retirement is falling. Workers do not want to increase their contributions or the age or retirement, and they hope the government will identify an equitable solution.

The debate over pensions in Morocco is taking centre stage once again. With the main pension funds posting financial deficits and their solvency being called into question, officials and technocrats are accelerating efforts to introduce far-reaching reforms in order to avoid a collapse. 

Moroccan pension funds are starting to feel the strain of demographic pressures, said Moroccan Interprofessional Pension Fund (CIMR) managing director Khalid Cheddadi. As the population ages and as public services employ fewer workers than in the past, he noted, the number of those paying contributions will continue to decrease year after year. If nothing is done, pension fund finances risk running seriously into the red. 

Morocco's ageing population is not the pension funds' only problem. Because of a growing high number of self-employed professionals, agricultural workers and "informal" workers who do not benefit from labour legislation and collective bargaining agreements, Morocco currently relies upon only 30% of the working-age population to pay into the country's pension system. 
As it stands now, the Moroccan pension fund (CMR) is not expected to survive beyond 2019. The national social security fund (CNSS) can only honour its commitments up to 2016. 

According to Minister of Economy and Finance Salaheddine Mezouar, Morocco is considering a general reform, not only to consolidate the funds' long-term balances but also to lay the foundation for a harmonious and coherent system. "Compulsory schemes based on collective solidarity can live alongside complementary optional products which offer a range of choices for individual initiatives," he told Magharebia. 

Calls for action by concerned trade unionists have prompted the state to consider several scenarios to rescue the pension funds. These include creating a single national fund for everyone, standardising methods of calculation in private and public retirement funds, raising the retirement age to 65 or using a lifetime work history model (35 or 40 years of work before retirement, regardless of age). So far, nothing has been decided. 

Workers hope the government will find an equitable solution without having to raise their contributions or the retirement age. 

Public sector worker Moha Bakkali told Magharebia: "I can’t imagine myself retiring at 65 when life expectancy is 70 years. It wouldn’t be fair." "The State must face its responsibilities,” he said. 

Morocco's pension system currently includes a number of funds. There is a fund for public workers in civil and military fields (Moroccan pension fund, or CMR); a fund for private sector workers (CNSS) complemented by ascheme managed by the CIMR (Moroccan interprofessional pension fund); and an organisation for those on State contracts (RCAR). Added to this are the various internal funds owned by certain public enterprises such as ODEP, ONCF, OCP and others. 

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