Pension: World
Archives:
2003
India:
Contributory pension system: Approach with caution
(December 23, 2003)
The population of India is increasing, and as in other
countries, getting older. By
2016, the number of Indians above age 60 is expected to
be 113 million. This is an average of 8.9 per cent of
the population. That’s why the government is considering
a reform that the author says must be supported. The
Ministry of Social Justice and Empowerment worked on a
national project called the Oasis project (The Old Age
and Income Security) that would deal with savings over
the life times of workers and unorganized labor. A key issue
will be whether such savings should be invested in
equities which have proved volatile in the US and
Europe. The author also points out the
social inequity of using public resources to “bail out”
private pension funds in times of economic downturn. Another
consideration is the location of the contributory
pension administration that will affect the economic
growth of its host city.
Malaysia : Pension fund
not short of money, says minister (December 23, 2003)
In
Malaysia, the Employees Provident Fund (APF) suffered
from the Asian crisis and many contributors worried
about their pension benefits. The Second Finance
Minister, Dr. Jamaludin Jarjis guaranteed that the EPF
had enough funds for all its contributors’ pensions.
It’s a relief for the 10.4 million contributors, but
they continue to worry about new proposals that would
affect pre-retirement withdrawals.
Mexico: Sindicatos celebran alza
a pensiones del IMSS (December 22, 2003)
(Article in Spanish)
Mexican union leaders praise an eleven percent raise in
the Social Security fund. If this eleven percent increase
continues to climb steadily, lives of older Mexicans will
get better.
Russia: Expats Go to Court Over Pension Dues
(December 22, 2003)
In
Russia, new pension contribution rules call for taxing
foreign employees. This seems unfair since foreigners
who work in Russia are not eligible for the pension
benefits when they retire. Some international companies
based in Russia asked the court to clarify the
situation. Most foreign workers are also taxed in their
home country. In fact, most of Western countries use
rules to prevent the double taxation. But Russia doesn’t
have any international agreement on this point. Russian
Finance Minister, Natalya Komova, explains: We have to
tax the foreigner employees since one day they may
assume the Russian citizenship and then demand a
pension.
New Zealand: More work-based retirement saving schemes
needed, says taskforce (December 22, 2003)
The New Zealand Periodic Report Group
recommended that the government create a Special
Advisory Group to encourage workers to participate in
retirement savings programs that could be transferred
from one job to another. In fact, New Zealand workers do
not save enough and with the baby boom retirees taking
their pensions, the situation will become worse. By asking for Financial
Advisors aimed at low and moderate income earners, it is
unclear if this will be a “privatized” effort or not. Perhaps low
and middle income workers simply need higher wages so
that they have money to save. Economic growth, the authors
contend, will boost saving.
Australia: Millionaires
on Pension Row (December 20, 2003)
Using a scam, Australian millionaires can use
a do-it-yourself pension fund to create structures that
enable them to easily pass the means and assets tests and
claim the full age pension in Australia. At the same
time, multimillionaires are using the self-managed pension
to legally shelter large parts of their fortune in a
pension reserve that can be used to provide for the next
generation.
United Kingdom: Brussels raises pressure on pension
plans (December 22, 2003)
The new
European Union rules may force some United Kingdom
pension plans to close. In fact, the new rules aimed at
having pension schemes financially available at any
time. This means a huge cost for the employers. Also firms
may decide to close their schemes to new members. The
National Association of Pension Funds (NAPF) worried
about the consequences on the retiree population and so
does the Trade Union Congress (TUC). The Department of
Work and Pensions officials said the interests of NAPF
will be taken into account. Who will speak up for those who
are “closed out” of a pension fund as they come into the
workforce or transfer to a new job?
Czech Republic: Insurer Ceska
pojistovna buys 70 % stake in ABN Amro pension fund
(December 22, 2003)
A major change in the Czech Republic’s pension
system. The Ceske Pojistovny pension fund, the largest
private pension fund of the country, has just bought 67per
cent of the ABN Amro Penzijni fond (ABN PF) pension fund.
No change is currently predicted for the 216,000 clients
of ABN. The
firm says it wants to improve services and assets of its
clients. The Czech Anti-Monopoly Office (UOHS) and the
Finance Ministry must approve the transfer from ABN to CP. However, we
wonder if private monopoly and distant ownership will be
positive, in the sense of serving older persons’ financial
needs responsibly.
Zambia: Kafumukache Refuses
to Sign Zambia Sugar Pension Scheme (December 20,
2003)
The recently privatized Zambia Sugar Company (now owned by
Ollova) must come up with an account of pension
contributions that workers have already made to their
pension system. Until
this is done, the Labour minister, Lt Col. Patrick
Kafumukache, will refuse to sign the new pension scheme of
the company. The
Lt. Col. is also concerned about occupational health and
child workers in the sugar cane process. The Labour
Minister says that retirement is a death sentence without
a pension. He
considers his nation as wealthy enough to improve itself
through economic development, with privatized companies’
profits contributing to job creation and education of the
population.
France:
Calcul des Pensions, Rachat de Cotisations: la Loi sur
les Retraites se précise (December 17, 2003)
Article in French
In
France, five decree projects were given to the National
Fund for Retirement People to make the new pension law
called « loi Fillon » effective. The new
measures will give pensioners a 3% increase in pension
benefits for employees working over 60 years old, a
better situation for pensioners who contributed to more
than one pension fund, an increase for small pensions,
an increase for each year spent educating children and
the possibility to buy back years of contribution.
European Union: IASB may allow use of
UK rule on pensions (December 17, 2003)
The European Union listed companies have to use
international accounting standards beginning in 2005
that affects pension schemes. The choice of the standard
is an important point and under debate now. The
International Accounting Standards Board has to choose
between two standards: the IAS 19 and the FRS 17. The
IAS 19 allows companies to smooth out gains and losses
over a couple of years. This existing international
pension rule distorts the reality of a deficit in any
single year, according to Sir Tweedie. The FRS 17 is the
British model. The balance reveals gains and losses
immediately. Sir David Tweedie, chairman of the IASB, is
supporting the British model, but it’s not clear what
the Europeans will decide to do. PIC
United Kingdom: Veterans pension
scheme attacked (December 16, 2003)
The British government wishes to cut the level of
pensions paid to the armed forces to offset the expected
annual rise in payments. The reform would also put back
the age at which veterans would start receiving their
pensions. These changes are unfair, some members of
Parliament argue, and are going to make veterans worse
off.
United Kingdom: Pension payouts
for lower-paid workers hit by tax changes (December
15, 2003)
The Engineering Employers Federation warned that the
British government's reforms designed to simplify the
pensions system could affect people with small
occupational pension savings. If a policyholder dies
within five years of starting to draw their pension, the
remaining savings entitlement would go to their widow or
widower since pension schemes guarantee five years’
worth of pension. However, it would be subject to a 35
per cent “stealth tax.” The reform package appears to
have unintended consequence which will hit lower paid
manual workers particularly hard as they are
statistically much more likely to die within five years
of retirement than people paid more or with easier work
lives.
United Kingdom: Will Britain repeat
US mistakes? (December 14, 2003)
The British government is proposing a new Pension
Protection Fund modeled after the US Pension Benefit
Guaranty Corporation. The PBGC might represent security
in retirement for many Americans but now this
quasi-government body is facing a financial abyss due to
the growing number of insolvent companies. The US
government backs up the PBGC with public funds in case
of problems. But any bailout means that all taxpayers
have to pay for the pensions of failed corporations,
perhaps 20% of the workforce. Is this fair? The Brits
will have to decide how to do it.
United Kingdom :State
pension to rise from April ( December 11, 2003
)
British Work and Pensions Secretary, Andrew Smith, told
Parliament that state pensions will rise in line with
inflation and extra help will be given to the poorest
pensioners and to those with savings. However, the
pension credit, created a couple of months ago, did not
benefit all those eligible for it. The system by which
pensioners can receive credit is too complex according
to the Conservative opposition.
United Kingdom :The Parent Trap ( December 10, 2003
)
The British chancellor, Gordon Brown, issued
a pre-budget report containing surprises for parents,
entrepreneurs and pensioners. One of the aims of the
government’s new proposal is to simplify the tax regime
for pensions. The draft paper focuses on greater
flexibility within annuity rules, opportunity for people
to take a pension much earlier and limit the maximum
pension benefits available at retirement. The chancellor
hinted that the current state pension scheme was
"sustainable" compared to other European countries and to
stay this way, state pensions will remain low in the
future.
United
Kingdom : Taking steps to
restore faith in pensions sector ( December 7, 2003
)
British policymakers are wrestling with the
pension system since it is under the strain of an
ageing population, the three-year fall in equity
markets and the closure by companies of hundreds of
pension schemes. The British government intends to
introduce legislation to protect workers’ retirement
funds and guarantee a decent pension if their
companies go bankrupt. The first step in doing so was
the creation of a pensions commission. Employees, with
the support of the Trades Union Congress, are pushing
for the introduction of compulsory investment into
pension plans to avoid poverty in old age while
business groups such as the Confederation of British
Industry are opposed to this idea.
Italians flock to
pension protest ( December 6, 2003 )
Huge crowds of workers and pensioners gathered in
Rome to protest
against the Italian government’s pension reform. Unions
say the reform is
unjust and ineffective, and they are refusing any
further dialogue until the government withdraws the
proposals. The crowd also protested Berlusconi’s
economic policies, which some say erodes the welfare
state by favoring the wealthy.
Great Britain :
Baby boom or pension bust ( December 1, 2003 )
British people are living longer, but that good news
means bad news for
Britain ’s
precarious pension system. To ensure that all pensioners
have enough to live on, British policymakers are looking
at multiple reform options, each fraught with political
controversy. Workers
could work longer, companies could pay more taxes, the
state could compel people to save, or, as this article
suggests, the Brits could just start having more babies.
Non-contributory pensions
and poverty prevention: A comparative study of
Brazil
and
South
Africa (December 2003)
A comparative study of
non-contributory pensions, published by Help Age
International, provides evidence of how non-contributory
pension programs affect the well-being and the security
of older people and their families. An international
team of researchers studied non-contributory pension
programs in Brazil
and South
Africa and found
that the programs had a positive effect on bringing
households out of poverty. This innovative program could
help other developing countries in the future.
Germans
debate benefits for elderly ( November
30, 2003 )
More than 100,000 protesters took to the streets of
Berlin
this month to protest against
Germany ’s first
pension cut and a rise in nursing-care insurance fees for
the elderly. With these measures, Chancellor Gerhard
Schroeder hopes to plug a funding shortfall and start
addressing the challenges of an aging population. The
long-standing “contract between generations” is
increasingly under threat in
Germany , while
younger people challenge older people to abandon some
benefits to keep the system from collapsing.
Brazil shakes up pensions ( November 26, 2003
)
The Brazilian Senate has approved a major overhaul
of the pension system, reducing the generous benefits paid
to retired public servants. The system had favored the
small minority of Brazilians who worked for the public
sector, contributing to
Brazil ’s deep
social security deficit.
Great Britain: Company pensions to be protected ( November
26, 2003 )
The
British government will introduce a Pensions Bill to
protect workers’ retirement savings. Under the current
law, thousands of workers lost their life’s savings when
their firm went bankrupt. The new bill will secure
workplace pensions and reduce the complexity of the
system. However, workers who have already lost out will
not be compensated.
Why
are retirement pensions under attack? ( November
17, 2003 )
In most Western countries, pension systems to
support older citizens are under attack. In a period of
ascending power among the rich, the most powerful have
targeted pension systems that benefit ordinary persons for
“reform.” This
article, while steeped in the language of socialism,
spells out some of the fundamental issues. The author, a
journalist for the World Socialist Web Site, believes that
“ruling elites” are making working people pay for the
problems of the profit system. As he rightly points out,
individual pension plans that invest in the stock market
eliminate the conception of an old age pension being a
social right. Betting
on the stock market casino becomes the unhappy
alternative.
Workers' pension fight continues (November 24, 2003)
United Kingdom: A bill to protect people who have company
pensions is likely to be in the Queen's Speech on 26
November. But workers who have already seen their pensions
disappear may not receive help. BBC News Online talks to
one worker who is fighting for his pension rights.
Russia: Elderly yearn for Soviet-style
stability from poll (November 19, 2003)
Svetlana Babichenko sells fur hats to top up her pension –
a far cry from the stable retirement she was promised
under communism. That, for her and millions of elderly
Russians like her, is the sole issue in the December 7
parliamentary election. "When you've got bread but no
butter, you do all you can to get the butter," she said,
shivering at her market stall. Babichenko, 77, is one of
Russia's 29 million pensioners who were among the biggest
losers when the Soviet Union's collapse in 1991 propelled
Russia into capitalism and a free market. They gained
political freedom, but lost cheap food, rent and state
benefits. They can only shake their heads at newspaper
reports of Kremlin wrangling with "oligarch" businessmen
who made billions of dollars in the 1990s sell off of
state property. Babichenko, once a factory-hand, has
resorted to selling the hats along with husband for sheer
survival.
British Airways flies into
pensions black hole Easy Jet’s profit falls by 28%
but it still expects to overtake BA in Europe (November
19, 2003)
British Airways has to put in extra money in one of
its pension fund or find different ways to cut costs.
Employees fear they might see their retirement benefits
reduced. The company remains committed to its pension plan
but has nonetheless opened talks with unions. British
Airways is one of the latest British employers that has to
face pension fund difficulties.
Koizumi's pension reform dilemma ( November
19, 2003 )
The Japanese Prime Minister, Junichiro Koizumi,
wonders how to reform the national pension system before
the government compiles the fiscal 2004 budget, end of
December. The reform would keep pension premiums under 20
percent of annual income and maintain pension payments
between 50 percent and about 55 percent of net annual
income for the average worker. Businesses are opposed to
raising premiums because they contribute to half of it and
they want more flexibility in a time of international
competition.
Japan ministries disagree on
pension reform (November 18, 2003)
Japanese society is worried about supporting
retired workers with pensions and how to increase
consumer spending.
It appears that the plan to cancel an income tax
rebate in order to finance future pensions is dead. While a
consumption tax could raise funds for pensions, the
public does not want to spend—they want to save for
their pensions in the future. And business
does not want to sacrifice its profits. A capitalist
dilemma!
Pensioner tax plan abandoned ( November
18, 2003 )
Hampshire County Council offered elderly voters a
rebate for part of their council tax but the plan was
abandoned. It appears that pensioners themselves opposed
having the rebate since it would have pressed more taxes
on low-income persons and reduced children’s educational
opportunities.
More
Oldies To Quit
UK
( November 18, 2003
)
About one million British retirees live outside the
UK
and this figure is supposed to grow even more by 2020.
Better climate and pace of life, lower living costs,
social advantages offered by governments trying to attract
them and their income, and growing exposure to foreign
culture encourages this old age migration.
一企業勞資科長冒領死人錢兩
年“吞”了7萬多(2003年11月17日)Enterprise Payroll Official Took
70,000 Yuan Pensions in Two Years (November 17, 2003)
Liming Zhang, Chief Payroll Official at Huzhou Hardware
Factory, took 73,155.3 yuan worth of pensions in the name
of four dead ex-employees. Zhang is sentenced for
three-year imprisonment for fraud. A judge believed that
the fraud could be avoided if the factory had an effective
monitoring and management system over payrolls and
pensions. As a matter of fact, Zhang was able to control
all the steps in payrolls and pensions, which made it very
easy for him to commit the fraud. (Article in Chinese)
Pension covers 'hardly anything,'
retired Mozambican pastor says (November 14, 2003)
Retired United Methodist pastor Joco Tene Ngale never saw
a self-sustaining pensions system in his home country of
Mozambique. He died just weeks after meeting with a
fact-finding group studying the feasibility of
standardizing pension support for United Methodist clergy
and other church workers outside the United States. The
church in Mozambique provides pensions to its retirees,
but the depressed economic system causes the amount to
vary. Ngale, who served 35 years as a pastor and district
superintendent in this southeastern African nation, was
receiving a pension of about $100 a year at the time he
spoke to members of the United Methodist Global Pensions
Task Force and other visitors.
企業年金制度可讓
養老金翻倍國家立法兩年難產(2003年11月13日)Enterprise Pension Plans Will
Double Retirement Benefits (November 13, 2003)
Last
year, officials of the China National Labor and Social
Security Bureau said that the regulation for
enterprise pension plans was expected to come into
force soon. But after over a year, the regulation is
still pending. If enterprises provide pension plans
for employees and pension fund managing companies
invest the funds well, retirees will be able to
receive extra income from enterprise pension plans
apart from the social security pension benefits. (Article
in Chinese)
Ethiopia:
Pensions of Former State Employees Doubled (November 11,
2003)
International aid organisations on Tuesday welcomed a
government decision to double state pensions, but warned
that more had to be done for Ethiopia's elderly. Peter
Bofin, the head of HelpAge International, said that
whereas the move was a positive step, it was noteworthy
that about 3 million old people in the country were
receiving no pension at all. Ethiopia's 411,000 or so
pensioners have now seen their state pensions doubled to
US $11 a month, but the recipients are all former
government and state sector employees.
United Kingdom: Don't bet on houses
for pensions (November 11, 2003)
Rampant house price inflation has given British people a
false sense of security about their future retirement
funds, discouraging them from saving, says Association of
British Insurers’ director-general Mary Francis. Francis
argues that people may suffer from their over-optimistic
outlook if property is not worth as much as they expected
by their retirement years.
United Kingdom: Pension credit
'got off to a good start' (November 11, 2003)
1.4 million pensioners will receive a new pension credit
created by the UK Work and Pension Secretary. The pension
credit combines a Minimum Income Guarantee (MIG) and an
additional payment rewarding pensioners for their savings.
However, not all eligible households have claimed the
pension credit, forcing the government to make sure the
most vulnerable pensioners are not left out.
Rover faces pension fund talks
(November 11, 2003)
Union leaders will meet with Birmingham-based car group MG
Rover after it announced the creation of a £12.9 million
trust for senior executives’ post-retirement benefits.
Workers’ representatives are concerned about the size of
the fund in light of the £95 million loss recently
revealed in the 2002 accounts.
Unions urge World Bank: Stop pushing
private pensions! (November 10, 2003)
The International Confederation of Free Trade Unions
(ICFTU) sharply criticizes the World Bank’s active
promotion of private pension plans at the expense of
traditional pay-as-you-go systems throughout the world.
The Bank supports privatization, claiming that private
funds will inject workers’ savings into national economies
and strengthen them. At times the Bank has bludgeoned
countries to adopt privatization if they want Bank or
other credit to build infrastructure. The ICFTU points out
that privatization is costly, has high administrative
costs and does not work. Private pensions are low,
especially for women, and many have no pensions. Instead
of pushing privatization, the authors say the Bank should
use its expertise and financial resources to help
countries to improve existing public programs.
The International Confederation
of Free Trade Union released a 60-page report on
the World Bank Involvement in the Privatization of
public pension systems in Developing and Transition
Countries in May 2003.
Irish Workers Are Slow To Embrace
Pension Plan (November 10, 2003)
With an average age of 35, Ireland has the youngest
population in the European Union, and those born during
its 1970s baby boom will come of pensionable age in 2035.
While France and Germany struggle over changes, Ireland's
government has taken action. But its latest big idea --
Personal Retirement Savings Accounts, which aim to boost
private pension coverage to 70% from 50% -- isn't proving
to be the savings bonanza the government had hoped.
The challenges older persons
face in Azerbaijan (November 10, 2003)
Gunel Sultanova of Global Action on Aging addresses the
plight of elderly refugees and internally displaced people
in Azerbaijan in a GAA seminar presentation. As Azerbaijan
struggles with economic and political turmoil left from
the collapse of the former-Soviet Union, refugee and
displaced seniors are particularly vulnerable, with little
or no state pension support.
United Kingdom: Bail-out for
workers' pensions (November 10, 2003)
The shipping firm Maersk voluntarily decided to ensure
that all members of the Sea-Land Services pension plan,
which they inherited as part of a takeover in December,
1999, will receive their full pension. United Kingdom law
does not guarantee a minimum pension for workers of a firm
that goes out of business, except for already-retired
workers. The Department for Work and Pensions won’t change
the law to protect pensioners until 2005.
Europeans Face a Bleaker Old Age
(November 7, 2003)
The “demographic time bomb” presents a troublesome
challenge for European governments: the number of
pensioners is increasing while the workforce contracts.
Europe may be forced to reform or privatize its generous
public pension system, leaving today’s young workers with
far fewer retirement resources. As a result, the younger
generation may have to work longer and save money to
retire as comfortably as the previous generation. Perhaps
people will want to work longer if jobs become more
interesting, less onerous and taxing on health.
United Kingdom: 'No
blank cheque' for pension victims (November 4, 2003)
Allied Steel and Wire (ASW) union workers lost 80
percent of their pensions when their company collapsed.
Now, ASW is taking the British government to the
European Court of Justice on charges that it did not
protect pensioners as required by law. Pensions minister
Malcolm Wicks has proposed a US-style insurance plan
that would prevent future problems, but the plan would
not compensate workers who have already lost out.
United Kingdom:
Baby boom pensions rethink urged (November 4, 2003)
Amid calls for a pension system revamp, Liberal
Democrat leader Charles Kennedy wants to set up a
working group to look at how people can continue to live
a “full and productive life” well into their older
years. Kennedy
argues older people should continue to have access to
higher education to improve their skills, and advocates
for gradual retirement over a certain period of time,
allowing older people to continue contributing to
society.
Turkey launches
private pension system (November 3, 2003)
Until recently, pension options for Turks were
limited to the low paying state social security scheme,
life insurance policies, property and the volatile Turkish
equity market. Now, five years of negotiations between
private insurance companies and the Turkish treasury has
resulted in a new private pensions industry. The pensions
industry is already lobbying for broader tax incentives,
even though the Turkish treasury relies heavily on income
tax from legal workers.
Thailand: Taking some risk out of work
(November 3, 2003)
The Labour Ministry has said all workers, self-employed
and company employees, will be covered by the Social
Security Fund by Jan 1, 2005. Not everyone is convinced.
Workers without any form of insurance have been calling
for social security coverage since 1998. Around 35.19
million people make up Thailand's workforce, but only 7.45
million, or 21.17%, receive social security cover,
according to the Labour Ministry. The other 23 million
include taxi and tuk-tuk drivers, fishermen, farmers,
contract workers, people who work from home, housekeepers
and self-employed doctors and dentists.
United Kingdom: Unions set to
sue government (November 3, 2003)
Hundreds of steel workers in Wales lost thousands of
pounds in pension benefits because the British
government failed to properly execute a European Union
directive protecting workers in firms that go into
receivership. Unions expect their case against the
government to be heard in the High Court early next year
before being transferred to the European Court of
Justice.
Israel Braces for Strike
Over Changes in Pensions (November 3, 2003)
Israel is preparing for a nationwide strike
to protest the government’s planned pension changes.
Finance Minister Benjamin Netanyahu wishes to increase the
retirement age to 67 years old for all workers, instead of
65 for men and 60 for women. The leader of Israel’s
largest labor federation, Amir Peretz, accuses the
government of imposing even greater burdens on the poor
and working classes.
United Kingdom: Pension talks
at Rolls Royce (October 30, 2003)
Rolls Royce says it will cope with its large pension
fund deficit by reducing the value of employees’
pensions by 20%. Heavy stock market losses in the last
three years, and fewer employees, led to the £1 billion
deficit. Union leaders say all levels of workers are
ready for strike action if negotiations between union
leaders and managers are not successful.
Under-35s face pension misery
(October 27, 2003)
A
survey by the UK National Consumer Council finds that
young people under 35 have particular difficultly saving
for retirement because of high costs, lack of confidence
in pension providers and insufficient financial
information. Analysts worry that young people
will be unprepared for retirement, and recommend simple
and clear financial advice to guide them.
Canada: Pension reforms welcome (October 27, 2003)
The
Régie des rentes du Québec proposes reforms in the
Quebec Pension Plan that would encourage older workers
to delay taking their pension benefits at the age of 65
and keep experienced workers in the Canadian workforce.
The Régie would increase pension benefits by 0.7% for
every month of work after the age of 65.
Zimbabwe: Inflation Wipes Out
Pensioners Income (October 25, 2003)
As the nation tries to come to grips with economic
hardships, many pensioners are destitute. Inflation has
eroded the value of their pensions so much that most now
rely on handouts. Some pensioners have even stopped
collecting their payouts. The bus fare to collect the
money is more than what is paid. Most of those in
destitution have pensions ranging from ZWD $900 (1000
Zimbabwe Dollars = $1.25 USD, GAA) to a maximum ZWD $90
000 a month. These pensions cannot match escalating
prices, being pushed by inflation, which has reached a
staggering 455 percent.
Don't rush
pensions reform, social partners plead (October 24,
2003)
Malta’s Finance Minister, John Dalli, is preparing for
Malta’s inevitable pension reform.. However, “social
partners” in Malta, including trade unions and employers,
urge the government to proceed cautiously with pension
reform. Mr. Dalli proposes making a higher retirement age
for workers an “option” depending on their working
capacity, but social partners remain critical of this
measure.
Italy hit by Pensions Strike as
Germany Debates Reforms (October 24, 2003)
European countries face a growing crisis in their pension
systems: the number of tax-paying workers is insufficient
to pay for retirees’ pension benefits. Governments are
starting to propose reforms, but they face intense
opposition. Italy has already been crippled by strikes,
and Germany is still waiting for public reaction to
ongoing political debates.
Russia: Every Fifth
Russian Works for Free (October 24, 2003)
Last week, the RF Pension Fund finished
printing of 42 million notifications to the citizens of
Russia to inform them of the pension accounts status.
Eight million of the notifications stated the pension
account status was zero. Thus, the official statistics
says that every fifth Russian is working for free. At
that, the reported information is not final at all.
Yesterday, RF Labor and Social Development Minister
Alexander Pochinok said that as soon as the information on
the status of pension accounts provided by the Pension
Fund is analyzed, the number of people having actual
"zero" pension accounts may even increase. The minister
says these are going to be "huge figures". What is more,
the RF Pension Fund does not have complete information
because "many employers do not register their employees as
workers."
(This article is also available in Russian in our
Russian section)
Pension plans prompt Italians
to strike (October
24, 2003)
A strike over Italian Prime Minister Silvio
Berlusconi’s pension reform proposals left the country
paralyzed, as unions called on workers to take the
streets. Berlusconi proposes to increase the number of
required contribution years to 40 years and raise the
retirement age to 65 for men and 60 for women. Unions
argue that government hype about pension reform is simply
masking Berlusconi’s other “misguided” policies.
United Kingdom : Today's
pension…tomorrow's burden ( October 22, 2003
)
All over Great Britain, people are finding their
employer-paid or private pension plans savagely cut
or completely lost. The state, argues this
journalist, is the only pension provider that can
guarantee a minimum income in old age. However, the
state pension system must represent a social
contract, affordable today and also for future
generations, not a burden.
United Kingdom: Britons 'still not
saving enough' for retirement (October 21, 2003)
More than a third of the British working population does
not save enough for retirement, even though few believe
that the pension system alone is likely to provide them
with a decent standard of living, says a recent survey by
the insurance industry’s trade body. Industry experts say
the British government has to create a reassuring
framework informing people on how to save enough to
guarantee a good standard of living in retirement.
German Pension System Plan
Increases Burden on Retirees ( October 20, 2003 )
A German government proposal to prop up its flagging
pension system will put a greater burden on retirees by
keeping employee contributions level. This proposal
reduces the German pension reserve fund and requires
elders to pay the full cost of nursing-care insurance.
Lower-income elderly people will be hit especially hard by
this step back in the German welfare system.
Germany proposes pensions freeze
(October 20, 2003)
The
governing coalition in
Germany
has
proposed freezing the level of retirement pensions
in 2004 as a part of its economic reform package. The decision - described by
Chancellor Gerhard Schroeder as one of the most
difficult his government has had to take - was
announced after a meeting between coalition
partners, the Social Democrats and the Greens. Mr
Schroeder admitted that the freeze effectively
amounted to a cut in real benefits received by
pensioners. The freeze is designed to help the
government deal with a substantial shortfall of $12m
(10.3m euros) in state pension funds.
United
Kingdom: Pension plans on life-support (October 20,
2003)
A flood of articles in the European media recently
has warned about the growing problem of paying
pensions as the populations of European countries age
and birthrates decline. For
Japan
, this
problem looks especially acute. The British claim that
they are in a better position than continental
European countries since many of their pensions are
funded through company and private schemes involving
money invested in bonds and equities. Old-age pensions
operated by the state on a "pay as you go" basis
(deductions from the earnings of those working pay for
the pensions of the aged) are hardly adequate for
survival. The author examines the issue of pensions in
Great Britain
and
the problems its aged population faces there.
Russia: Whom Can You Trust With
Your Pension? (October 20, 2003)
A
Russian journalist illuminates crucial problems with
the Russian pension system through the struggles of
his son and daughter-in-law. He touches upon issues
that older people worldwide face when trying to
claim the pensions they deserve: women penalized for
taking time off for childcare, an abundance of
information but a lack of explanation, and
government pressure to privatize.
'Old'
Europe
struggles with pension ( October 19,
2003 )
European governments are having
trouble paying the pension bill, as millions of baby
boomers head into retirement. Without pension system
reform, costs will get even higher while pension
benefits decrease even further. The first victims of
Europe
’s pension crisis will be the
poor elderly who may not be able to pay for their
basic needs.
Japan : Making pensions work ( October 18, 2003
)
The pension
debate is back in
Japan
, as campaigns for
Japan
’s Lower House
elections get under way. Both young and old people worry
about the pension system: the former think they won’t
get back what they put in, and the latter worry their
benefits will decrease. Japanese political candidates
are all pitching their platforms on how to pay for
pensions, but voters want them to forget the sweet talk
and make credible proposals in the next few days.
Namibia: MPs Trade
Barbs Over Pension Hikes (October 17, 2003)
SWAPO (South-West Africa
People's Organization) levelled a host of accusations
against the opposition as ruling party lawmakers
maintained their hardline stance against proposals to
increase old age pensions on Wednesday, October 15. The
debate on an opposition motion calling for pensions to
be upped to N$550 a month resumed with no signs
compromise from either side of the House. The current
pension is N$250 a month ($34 – GAA).
United
Kingdom : Treasury targets high
earners' pensions (October 17, 2003)
Wealthy British business leaders are uniting to fight a
Treasury reform proposal that would limit the amount of
money they can have in their pensions by the time they
retire. The government wants to impose a £1.4m “lifetime
limit” on pensions, and funds in excess of that limit
would be heavily taxed. While the Treasury notes that only
about 5,000 people would be affected by the reform, a
powerful lobby of high-income earners says the limit would
discourage pension savings, and encourage businesses to
shift remuneration from pensions to salaries and benefits.
Nigeria: Many Teachers Died
Without Their Pension (October 16, 2003)
In the swirling economic
currents of rising cost of living, fuel price hike, low
wages, high rents, widespread poverty, low purchasing
power, and prevalent recession, unpaid pensions of
retired teachers is sending many of them to the great
beyond. National President of Nigeria Union of Teachers
(NUT), Mallam Abdulwaheed Ibrahim Omar has disclosed
that many retired teachers have died across the country
without being paid their pensions. He stated: "It is the
age-long problem of unpaid pension rights to teachers
who retired from our school system, particularly primary
schools, since 1994. These teachers have remained since
retirement in many states, without their gratuities and
without pension. Many have died. Many more are sick and
cannot afford the high cost of medication. Not a few
have been thrown into destitution, undue dependence and
state of extreme hunger, disease and untold suffering".
Malta: Dalli proposes mix of private,
state pensions (October 15, 2003)
The Finance minister of Malta, John Dalli, proposes a new
pension system that would combine the pay-as-you-go
system, ensuring a minimum income for all elderly people,
with a funded scheme of private pensions. Dalli maintains
that Malta
needs to prepare for the challenges
of an aging population by guaranteeing a strong and viable
pension system, but insists
Malta ’s social
safety net should remain intact.
Minister acts on pensions, Kelly demands radical change in
City investment management (October 15, 2003)
Ruth Kelly, the British financial secretary to the
Treasury, called a meeting with leading figures in the
pension industry to demand radical changes in the
management of retirement funds by City firms. The reform
needs to tackle the traditional approach of the pension
fund industry, which fosters a short-term approach
instead of long-term investments. Furthermore,
consultants and trustees have to work together to make
the best investment choice for all the members of a
pension fund.
Russia : Pension Reform Follows Corporate
Example (
October 14, 2003)
Pension reform is a hot topic as the
government wrangles with a new system to improve
retirement prospects for the nation's millions of workers.
The failings of the old state system created during Soviet
times are obvious: people toiled away the best years of
their lives only to be left with subsistence-level
pensions in their golden years. The question today is how
will working people cope with the new options for
investing their hard-earned capital? Will the corporate
pensions’ example help them?
Europe:
Pension crisis straps Europe (October 15, 2003)
Aging is a planetwide phenomenon. The number of
people aged 60 and over -- 606 million in 2000 -- will
hit 1.9 billion by 2050, outnumbering children for the
first time in history, the United Nations estimates.
It's a problem familiar throughout the industrialized
democracies, from
Japan
to the United States. Europe, however, is particularly challenged
because it is among regions aging first, its pension
benefits are sometimes exceptionally generous, and they
are often financed by the current generation of workers.
Such schemes were fine when
workers greatly outnumbered retirees. But that's no
longer the case. After the postwar boom, birth rates
plummeted. The result is that by 2040, across the
15-nation European Union, there will be just two
working-age people per retiree, the World Bank
estimates. That's half the current ratio of 4-to-1.
Barbados:
Pension plan ease (October 15, 2003)
In a move to widen the net of Barbadians covered by
pension plans, Government yesterday introduced sweeping
new legislation to govern the administration of private
pension plans while making them more accessible. The new
measures will shorten the time employees must wait before
becoming eligible to join pension plans; give members in
such plans vested rights to their employers’ contributions
after only three years and make provisions for employees
to take their accrued pension rights from employer to
employer.
Fresh attack on Britain
over expatriate pensions
(October 13, 2003)
The new Australian minister for family and
community affairs blasted the British government for its
discriminatory and unfair system regarding British
pensioners in Australia and 47 other countries. The
British government does not allow expatriate pensions to
rise with inflation, a problem exacerbated by the
increasing value of the Australian dollar against the
Sterling , leaving
the Australian government to support British retirees in
need of financial help.
Australia: Medicare 'an
article of faith' (October 12, 2003)
Despite current
problems, Australia
has a good health system compared to other countries.
Unlike Britain, we have a vigorous private sector which
takes the pressure off public hospitals. Unlike America,
access to top-quality health care does not depend upon
private health insurance. After the Japanese and Swiss,
Australians have the highest life expectancy in the
OECD. After the Japanese, Swiss and Swedish, Australians
have the longest healthy lives in the OECD. Even so,
governments can never be complacent about the state of
our health system because health is important to
everyone.
Namibia:
Passions High Over Pensions (October 10, 2003)
The government has again
ruled out adjusting pensions for Namibia
's elderly, at least for now.
Breaking her silence on the issue during debate in the
National Assembly, Health and Social Services Minister,
Dr Libertina Amathila said on Wednesday that the current
N$250 paid to the elderly was all Government could
afford "I wish the Swapo Government owned a gold mine,
certainly the senior citizens would be getting
sufficient allowance [then] ... as for now, what the
Ministry is giving is what Government can afford," she
said. The motion, moved by DTA President Katuutire Kaura
two weeks ago, calls on Government to increase pensions
to N$550.
United
Kingdom: Compulsion moves up the
pensions agenda
(October
8, 2003)
The United Kingdom
is embroiled in a debate about
whether the government should impose compulsory pension
contributions, forcing people to save for retirement. Charities
for the elderly, the Consumers' Association and many of
the big trade unions support compulsion, but some people
remain skeptical that it might not actually increase
savings. Furthermore, compulsion would affect mostly the
middle class, who might not always be able to afford
saving for retirement, which could imply great political
risk for the government.
Germany: German pensions 'face a shortfall
of €9bn' (October 8,
2003)
Pension funds in Germany are facing a financial deficit, while
high unemployment and falling net salaries have resulted
in decreased pension contributions. To avoid making the
workforce pay more in pension contributions, the German
government may instead postpone the next scheduled rise
in payments to pensioners, adding to the distress of
elderly people with low pensions.
Taiwan: Portable pension
system in the works (October 10, 2003)
A new law in the works promises
to substantially improve old-age security for the great
majority of Taiwanese. Staff Writer Francis Li examines
the provisions of the Labor Pension Statue draft bill
recently submitted to the Legislature, based in part on an
interview with Lee Lai-hsi, director of the CLA Department
of Labor Standards.
Taiwan is a step
closer to guaranteeing retirement pensions for all of its
workers now that a Labor Pension Statute draft bill has
been drawn up by the Council of Labor Affairs (CLA) and
sent to the Legislature for review. Under the existing
Labor Standards Law, more than 75 percent of workers in
Taiwan
are not able to receive pensions upon retirement. To be
eligible for a pension under current rules, employees must
have been employed at the same company or organization for
at least 25 years if retiring before age 55, or for at
least 15 years if retiring thereafter.
Tanzania: Retirement
age to remain 60 (October 10, 2003)
The Prime Minister, Frederick Sumaye, has
said the government does not have plans to reduce the
retirement age for civil servants, even if the life
expectancy continues to decline in the wake of increasing
HIV/AIDS deaths. Sumaye said this when responding to
questions from journalists during a question and answer
session, which was recorded by Radio Tanzania Dar es
Salaam (RTD) yesterday. “We will not reduce the current
retirement age on grounds of increasing HIV/AIDS deaths.
Despite the decline in life expectancy, the government
will continue to uphold the current legal retirement age
for civil servants,” Sumaye said.
China: Women
question early retirement (October 9, 2003)
When the pioneers of New
China formulated rules al-lowing women to retire five
years ahead of their male colleagues out of concern for
their health, they did not foresee that their goodwill
would be resented by many women decades later. The
policy has been challenged by women, particularly
white-collar professionals and civil servants, who are
increasingly sceptical about the fairness of the rules
of yesteryear. Times have changed, they argue, and
technology and efficiency have relieved more and more
people from hard physical labour. So the different
retirement ages for men and women appear to discriminate
against women.
United
Kingdom: Stakeholder pensions 'missing target' (October 7, 2003 )
The
government's low-cost stakeholder pension schemes are
failing to reach their target audience, according to a
study. The pension
schemes were launched in April 2001 to help people on
low incomes save for their retirement. According to
research firm Datamonitor, the schemes are being used
mostly by existing pension holders and wealthy
customers. These people are attracted by their cheap
charges and tax advantages.
United Kingdom: Pension
protesters call for end to means testing (October 7,
2003)
Pensioners took to the streets in protest when the
Government's controversial Pensions Credit scheme was
introduced yesterday, claiming it should be replaced by an
increase in the basic pension. Ministers say half of
Britain
's eight million pensioner households will be £400 a year
better off with the new credit. But pressure groups say
the means-tested scheme is too complex and expensive to
run. Accompanied by a piper, the 100-strong crowd marched
from Smith Square
to Portcullis House, central
London, stopping on the way to drop off letters at the
Labour, Liberal Democrat and Conservative Party
headquarters.
Kenya: Treasury
acts tough on pensions (October 7, 2003 )
The government has appointed a task force to clear the
backlog at the Pensions Department in readiness for the
coming into effect of a new pensions law at the beginning
of next year. And in a move aimed sparing the government
the heavy penalties stipulated in the new law, the
Treasury has given the Pensions Department a three-months
ultimatum to clear all retirement cases pending before it.
A point of View:
A Graying Europe Wonders How to
Pay Its Pensioners (October 4, 2003 )
For decades the Catholic Church's pleas asking
governments to reject family planning have often fallen on
deaf ears. Now, in the midst of a birth dearth and a
graying population, European governments are finally
wakening up to the looming crisis in their pension plans.
Demographers gathered at a recent meeting of the
International Statistical Institute in
Berlin warned of problems
due to population aging, Reuters reported Aug. 15. "While
the 20th century was the century of population growth, we
can already say from a demographic perspective that the
21st century will go into the history books as the century
of aging," said Wolfgang Lutz of the International
Institute for Applied Systems Analysis in
Austria .
Nigeria: New Pension Scheme, Recipe
for Anarchy – OPS ( October 2, 2003 )
The Federal Government's proposed new
national pension scheme suffered another major setback as
Manufacturers Association of Nigeria (MAN), Nigeria
Employers Consultative Association (NECA) and Nigerian
Association of Cha-mbers of Commerce, Industries, Mines
and Agriculture (NACCIMA) dismissed it as a recipe for
anarchy.
Trinidad and
Tobago: New NIS pension from
today (
October 1, 2003 )
The National Insurance Board has adjusted the monthly
pension payment for 47,551 NIS
pensioners. The adjustment which takes effect today —
October 1 — ensures a minimum NIS pension
of $1,000 for each NIS
pensioner.
Japan: Sakaguchi focusing on
pension reform (
September 30, 2003 )
In the fourth of a series of interviews with senior
Cabinet ministers with important and difficult
responsibilities--such as curbing deflation, tackling
pension reform and dealing with North Korea--Health, Labor
and Welfare Minister Chikara Sakaguchi says an important
task facing his ministry is to determine the steps to be
taken in raising funds and implementing other measures
needed to carry out a government plan to increase the
ratio of government contributions to the state-run basic
pension plan from one-third to half.
South Korea:
Pension plan would keep funds intact if firms fail ( September 30, 2003
)
The Labor Ministry yesterday unveiled a new pension
system that, if the National Assembly approves it, would
guarantee wage-earners’ pensions even if their company
goes bankrupt. The plan in essence would force companies
to fund their pension plans fully; the funds would be
managed by an outside firm. The ministry said it wanted
the new pension scheme to be in effect next July. At
present, Korean firms with pension plans manage the
pension contributions themselves; there are no
provisions for recovering money in pension accounts if a
firm goes bankrupt. Under the ministry’s proposal,
pension funds would be managed and eventually paid out
by financial firms contracted to manage the investment
of those funds.
Namibia: Pension Hike Ruled Out ( September 30, 2003 )
Namibian Government has ruled out increasing pensions
for the elderly soon. At the first ever national
consultative conference for the elderly, Health and
Social Services Minister Dr Libertina Amathila said that
while it was Government's intention to continue
increasing grants for pensioners this could only be
considered when the country was financially better off.
The current pension is only N$250 per month. "Our
Government cares,
Namibia
cares
for older people, but we only have one cake and there is
a lot to share. Once resources have improved, we will
add a little onto old age pensions," Amathila told about
100 pensioners from all the country's regions gathered
in Windhoek
to discuss issues facing them.
United Kingdom: There
is no substitute for the state pension (September 29,
2003)
Very few governments, regardless of their persuasion,
have the necessary political foresight to make decisions
that take into account the needs of both today's and
tomorrow's population. It is widely accepted in
Europe and elsewhere that we have an
ageing population. This is something to be celebrated
rather than condemned as some would have us do; for,
despite the ratio of working people to retired falling
over the next 30 years, the nation's wealth, through
increased productivity and growth, will continue to
exceed what is needed in order to provide financial
security in our retirement. The response to such
developments - such as the proposals to raise the age at
which people can draw their state or company pensions,
hidden behind the call for equal opportunities - are
evidence of the short-termist, knee-jerk approach that
suffocates the development of a coherent pensions
policy.
India: State panel moots six
pension plan options ( September 29, 2003 )
A high-powered committee of state secretaries, in
consultation with the Reserve Bank of India (RBI), has
suggested six alternatives to replace the existing pension
schemes of the Central and state governments. The proposal
seeks to reduce the financial load on the
Union and state governments in the face of
pension-related expenditure mounting to as much as 20 per
cent of some state Budgets.
Italy 'must face
pension reform' ( September 29, 2003 )
Speaking on national television, Mr.Berlusconi appealed
to the electorate to back his government's plans to
reform Italy
's expensive welfare system. Mr.
Berlusconi said his government was determined to make
changes that would provide Italians with greater
"security and well-being", and said opponents of change
were deceiving the public. But union leaders dismissed
Mr. Berlusconi's appeal, and said the issue had been
blown out of proportion.
Malta : Plans to raise
retirement age to 65 ( September 26, 2003 )
The government is to propose raising
the retirement age to 65 in its pension reforms, according
to government sources. The proposals are expected to be
presented to the Welfare Reform Commission for
consultations. Social Policy Minister Lawrence Gonzi and
Finance Minister John Dalli have been working hand in hand
on the proposals on the basis of a number of studies on
the welfare gap problem and, particularly, the
sustainability of pensions as the number of pensioners
rises in relation to the number of workers making national
insurance contributions.
Pensions:
Chile's other revolution ( September 25, 2003
)
Shortly after General Augusto Pinochet toppled
Chile
's
socialist president from power, another, altogether more
peaceful revolution was set in train - pension reform.
The country went through “capitalization” phase that
forced the state and social services to distance
themselves from fixed pension provision. Instead, the
retirements become the sole responsibility of those who
retire. The most
important aspect of
Chile
's pension reform was that it
switched from a defined-benefit scheme (where pensioners
receive a fixed amount, irrespective of their
contributions) to a defined contribution scheme (where
pensioners' income is based on the money saved during
the person's working life).
United Kingdom: Legal fight for
gay pensions (September 24, 2003 )
The government is facing a
union-backed legal challenge over the pension rights
of gay workers. The
unions say new equality laws banning discrimination on
the grounds of sexual orientation, due in December,
are not being implemented correctly. They say a
loophole will allow pension schemes to continue
offering benefits to married couples only. Religious
organisations will also continue to be able to bar
gay, lesbian or bisexual people from working for them,
unions say.
Ireland: 250,000
workers face pensions time bomb (September 24, 2003)
Almost a quarter of a million Irish workers with defined
contribution pension schemes are sitting on a potential
pensions time bomb and largely unaware of it, according
to the Irish Association of Pension Funds (IAPF).
Raymond McKenna of KPMG and the IAPF told a conference
today that the average defined contribution pensions
member needs to "significantly" increase contributions
if they are to secure an adequate income in retirement.
United Kingdom:
A nation fooling itself (September 24, 2003)
More than half Britain’s
workers will be forced to rely on state hand-outs in
retirement, although most have fooled themselves into
expecting a comfortable old age, a new pensions study
shows. The Pension Map of Britain 2003, a study
by JPMorgan Fleming, the investment bank, paints a grim
picture of a nation of workers that is failing to save for
retirement but clinging to the belief that they will have
a retirement income of almost £19,000 a year. Instead, the
bank warns them that three in four working adults will
have to survive on an income of less than half their final
salary. The average British salary is now £24,603. To
achieve a retirement income of £19,000, workers would have
to retire on 77 per cent of the average salary.
China: DOH
starts free flu vaccination for elderly (September 23,
2003)
A nationwide free vaccination campaign against influenza
for the aged, sponsored by the Department of Health (DOH),
kicked off yesterday with hundreds of elderly citizens
queuing up for their turns to get a shot at every public
hospital. The campaign lasts until November 15. Only
people 65 years old or older are beneficiaries, but
anti-flu shots are not exactly free. The DOH provides
vaccines free. "We have 1.64 million vaccine shots
distributed across the nation," a spokesman said. Any old
man or woman who receives a vaccination has to pay a
registration fee as well as that for injection. The fees
vary from hospital to hospital.
Nigeria sounds alarm over pensions
(September 22, 2003)
Nigerian authorities have uncovered a huge deficit in
the state pension fund, confirming what many unpaid
former state workers have feared for years. Retired
civil servants have long complained of non-payment of
their pensions, with many forced to queue for days to
claim what they are owed. According to Nigerian
government calculations, the shortfall in the state
pension fund amounts to at least 2 trillion naira
(£9.3bn; $14.8bn). The revelation is likely to stir
suspicions that some of the money may have been
misappropriated. Corruption was a major issue in
Nigeria's recent election, which saw won by President
Olusegun Obasanjo and his People's Democratic Party
(PDP).
Only 15 years of surplus will
save Euro pensions (September 21, 2003)
European governments need to maintain a budget surplus for
more than 15 years to fund state pensions for today's
middle-aged, the International Monetary Fund has warned.
Europe's ageing populations will need public spending of
around 17 per cent of GDP by 2050 to fund their pensions.
Governments must run surpluses of about 2 per cent of GDP
for the next 15-20 years to meet the requirements, the IMF
said last week.
Switzerland:
Protesters tell Bern to leave pensions alone
(September 20, 2003)
More than 25,000 people have protested in the Swiss
capital, Bern, against government proposals to cut
retirement benefits.Under the proposals put forward this
spring, Couchepin suggested that in order to “save” the
state pension scheme, the retirement age should be
raised from the current 65, to 67. The rise would take
place in two stages – from 2015, it would increase to 66
and from 2025 to 67. Moreover, the interior minister
wants pension payouts to be linked to inflation rather
than based on final salaries as at present. His
proposals would bring costs down, but even with them the
state would need more money to keep funding its pension
commitments. Demonstrators marched through the city
centre on Saturday waving banners which read “Hands off
our pensions!”, bringing traffic to a standstill.
Angola: Vice-Minister Remarks On
Additional Pension (September 19, 2003)
The Deputy Minister of Public Administration, Employment
and Social Security (MAPESS), Sebastião Lukinda,
Thursday, September 11 in Luanda exhorted employers to
establish complentary pension systems that give workers
better living standars after retirement. Mr Lukinda, who
was speaking in the 2nd Colloquy on Complementary Social
Protection, said these rules will improve the conditions
of the workers, who mostly get low pensions, and will
also stimulate them to work more.
Russia: The
Pension Test (September 19, 2003)
Forty
million Russian citizens now have the right to choose
who will manage their pension savings: the state
Vneshekonombank (VEB) or one of over fifty private
companies. The VEB promises complete reliability but
at yields lower than inflation, while private
companies offer actual yield of 3-4% but with unknown
risks.
Mozambique: Delay in Pensions
Prejudices Miners (September 19, 2003)
The Mozambican National Social Security Institute (INSS)
has denounced delays in the forwarding of pensions by
the South African Rand Mutual insurance company, to
Mozambicans who once worked on the South African gold
mines, reports Thursday's issue of the Maputo daily
"Noticias". The delays are damaging the interests of the
former miners and their families. Meanwhile, the
delegate of the Mozambican Labour ministry in South
Africa, Pedro Taimo, said that more than 1,000 cases are
pending the location of their beneficiaries in
Mozambique.
Malaysia: Pension scheme for
private sector (September 16, 2003)
An alternative voluntary pension scheme has
been suggested in place of the discontinued Employees
Provident Fund (EPF) annuity scheme. MCIS Zurich chief
executive officer L. Meyyappan said unlike government
servants who were well protected with pensions equivalent
to half of their last drawn monthly salary for the rest of
their lives, the same cannot be promised for private
sector employees. “The lump sum payment from EPF upon
reaching retirement age of 55 is definitely not adequate,
and that fact has not been disputed. “This issue, if not
properly addressed, will result in various social problems
for the older generation,” said the former Life Insurance
Association of Malaysia (Liam) chairman in an
interview.
Nigeria: Epidemic Threatens
Pension Exercise As Kalu Calls for Restructuring of
Scheme (September 15, 2003)
An outbreak of epidemic is imminent in Asaba, capital of
Delta State as hundreds of military pensioners who had
reported at Oshimili South Local Government arcade,
venue of screening and payment of their pension, have
turned the centre into a faeces dump. But the Abia State
governor, Dr. Orji Uzor Kalu, has called for total
restructuring of the country's pension system in order
to overcome the problem being experienced by retired
civil and public servants. Speaking during a breakfast
meeting with media practitioners in Abia State, weekend,
Kalu recalled how he offered a panacea on how to
overcome the problem of payment of pension, regretting
that labour leaders misunderstood his intention and
called him names.
United Kingdom: Elderly
mental health 'timebomb' (September 15, 2003)
The number of elderly people with dementia is
set to soar - but social services will be unable to cope,
a charity has warned. Friends of the Elderly looked at
existing provision in South East England - which has a
particularly high concentration of people aged over 65. The charity found many
authorities do not have the necessary information about
future need in their areas. It says action is needed to
avoid a "catastrophe in care provision".
Nigeria:
Kwankwaso Attempts to Eliminate Fake Names From
Military Pensions (September 12, 2003)
Defence Minister, Engineer Rabiu Musa Kwankwaso has said
the Federal Government will only inject more fund for
the payment of the arreas of pension and gratuity of
military retirees if fake pensioners are flushed out of
the administration of military pensions board. Engineer
Kwankwaso disclosed this when he visited the Mogadishu
Barracks during the general conduct of the pay parade
and verification exercise of some retired military
pensioners, which commenced nation-wide recently.
United Kingdom: Pension 'let down'
for elderly in homes (September 11, 2003)
Under the new Pension Credit, to be introduced on 6
October, pensioners with modest savings will be rewarded
for their thrift - and receive a Savings "credit" from
the government. Pensioners can get up to £14.79 a week
for a single person and £19.20 for a couple under this
savings element from the Department for Work and
Pensions. But according to the Department of Health, an
estimated 80,000 pensioners who are eligible for the
savings credit and who live in a care homes will have to
pay part of the credit back.
Lagos State
Plans to Undertake Census of Pensioners (September 9,
2003)
The Lagos State government has set up a committee
charged with the responsibility of verifying the claims
and payment of pensioners salaries for the next three
months. The public relations officer, Lagos state civil
service pension office, ministry of economic planning
and budget, Mr. Jide Lawal announced the new initiative
in a statement issued yesterday.
Study
warns on Japan's pension deficit (September 9, 2003)
Japanese companies face unfunded liabilities in their
employee pension funds that are far larger than those at
US corporations, where pension deficits have led to
worries about the financial health of large companies.
According to a report to be released today by Greenwich
Associates, a US consultancy, assets at employee pension
funds in Japan cover on average only 62 per cent of the
payments they will need to make to retirees in future.
The assets of US funds cover 103 per cent of their
payment obligations.
Nigeria: FG
proposes Contributory Pension Scheme to replace NSITF
(September 9, 2003)
The Federal Government has sent a bill to the National
Assembly repealing all existing pension schemes including
the Nigeria Social Insurance Trust Fund (NSITF). The bill
pegs the asset base and minimum capital of fund custodians
at N250 billion and N2 billion respectively thus excluding
many players from pensions management. For the Federal
Government employees, they are to contribute a minimum
seven and half percent of their total monthly emoluments
for their pensions while the government is to pay a
minimum of twelve and half percent. For those in the
military, it is a minimum of 15 percent by the employer
while a minimum of five percent is to be contributed by
the employee. In all other cases, seven percent applies
for the employee, or as agreed by both parties.
The
role of old age pensions in reducing poverty
(September 4, 2003)
Non-contributory pensions can help to reduce and prevent
poverty among older people and their households in
developing countries, according to evidence from a new
research study, which compares and examines the impact
of non-contributory pension programmes in Brazil and
South Africa. The joint project was undertaken by
researchers in the UK universities of Manchester and
East Anglia, universities in Brazil and South Africa,
and HelpAge International.
Australia shakes up pensions
savings rules (September 9, 2003)
Australia is to reduce its much-criticised superannuation
surcharge on high-income earners. Also, in an attempt to
encourage pension saving among poorer Australians, the
government will match contributions for low earners. The
Investment and Financial Services Association, an industry
body, hailed the moves - first mooted during the 2001
election campaign but held up by political disagreement -
as "the most significant breakthrough in superannuation
tax in 15 years". Helen Coonan, assistant treasurer, said
that as a result of a compromise deal reached at the
weekend with the Democrats, the 15 per cent surcharge on
pension payments for those earning over A$90,500
(US$58,820) would fall from 15 to 12.5 per cent over three
years.
India: Government
bullish on pension sector growth (September 9, 2003)
The pension sector is expected to become the largest
financial sector in India in the next five years and
there will be a separate law for the sector, a top
finance ministry official said on Tuesday. "Over the
next 3-5 years, the pension sector will be the largest
sector in the country," U K Sinha, joint secretary
(capital markets and pension), said at a seminar
organised by the Associated Chambers of Commerce and
Industry in New Delhi.
Russia: 55 Earn Right to Handle
Pension Funds (September 08, 2003)
The Finance Ministry announced Friday a list of 55
private companies with the right to manage billions of
dollars in pensions savings, amid criticism that such a
profusion will confuse people and leave control of the
funds in the government's hands. As of next month, some
40 million pensioners-to-be must either select one of
the 55 private companies or have the investment portion
of their money managed by state-owned Vneshekonombank,
or VEB, by default.
Italy: National Alliance, no
steps taken, Tremonti data insufficient (September 8, 2003)
No step ahead were taken in the Villa Spada summit on
pensions and the budget. The severe judgement arrived
from National Alliance (AN), according to whom "the
elements supplied by the Minister of Economy are not yet
sufficient to delineate the entire picture of the
situation, both on resources to be found, and also on
possible uses of resources to relaunch development and
guarantee social cohesion," said the Minister of
Agriculture, Gianni Alemanno, and the Vice Minister of
Economy, Mario Baldassarri.
United Kingdom: Pensions set to rise
(September 8, 2003)
The Social Security Authority (SSA) is asking
politicians to agree to a 7.4% rise on a top rate of £121
a week. Married pensioner couples would see an increase of
£9.50 a week to £200. This is the second year in which the
authority has recommended putting nearly all the increase
on the single pension rate. The move is designed to make
the single pension a higher proportion of the married
couples' rate.
Fears over Russian
pension fund reform (September 07, 2003)
From next year, Russian citizens will be able to opt for
a private manager to run their pension account instead
of the state. But the decision involves a significant
drop in requirements for fund managers to be able to
compete for $3bn (€2.7bn) of state pensions and
threatens to undermine confidence in pension reform.
Elizabeth Hebert, head of Pallada Investment Management,
warned: "The government was obligated by law to
establish higher fiduciary standards and they have
failed to do so. Some of the companies which they are
recommending to the Russian population have no public
track record at all. This discredits the pension reform
in the eyes of the population."
Britons 'to work longer' (September 3, 2003)
The research, compiled by the Future
Foundation on behalf of Saga, concluded that by 2020
nearly two million people will be working past the age of
65. Reduced pensions, better life expectancy and skill
shortages will lead to employers throughout the UK relying
on older workers, it said. More women are likely to be
working as the state retirement age for women will have
increased to 65, in line with their male colleagues. By
2020 workforce participation rates are actually expected
to be higher for women than for men.
United Kingdom: Baby boom
backlash warning (September 3, 2003)
An independent think tank is warning
politicians they could face a backlash from the post-war
baby boom generation if they do not deal with their
demands as they approach retirement. The generation that
protested against the Vietnam War will not keep quiet as
it prepares to get its bus pass, Demos are warning. One
issue likely to generate protest is that of pensions, with
the report saying no government should expect the pensions
crisis to be solved by encouraging people to continue
working into later life.
United
Kingdom: Tea and social security (September 3, 2003)
Work and Pensions
Secretary Andrew Smith was competing for attention with
"Turkey and Tinsel" breaks to Eastbourne at £169 a throw
on the Age Concern stand, as he met pensioners at
Westminster's Churchill Hall. Over a slice of cake and a
cuppa, he set out to sell the government's new mega
benefit - the £2.5bn Pension Credit.
United Kingdom: Pensioners'
lost millions (September 3, 2003)
Pensioners
are missing out on millions of pounds worth of state
help. Sally West, Age Concern's policy expert, offers
some help to those who want to get their hands on the
cash.
Australia:
Population ageing faster than thought (September 3,
2003)
Australia in 2051 is likely to have a
million more people than previously thought - but most
of the extras will be people over 65 years old, the
Bureau of Statistics has projected. In a dramatic
revision of the nation's official population
projections, the bureau's central projection estimates
that by 2051, there will be more than five times as many
Australians aged 85 and over than there are now. From
290,000 now, the number of those over 85 will inflate to
almost 1.6 million, assuming the inexorable growth in
human longevity rolls on.
Bangladesh: Tension
runs high over rumour of forced retirement
(September 3, 2003)
Bangladesh
tension runs high in the civil administration over
speculations that officials of a particular batch, who
were already discriminated against in promotion and
superseded by their juniors, would be given forced
retirement. The situation worsened as four joint
secretaries and one deputy secretary were forced into
retirement on Sunday.
Canada:
Canadians worried about retirement (September 2, 2003)
Lack of money for
retirement worries many Canadians, a Statistics Canada
survey indicates. About one-third of people aged 45 to
59 don't think they have set enough aside to maintain
their standard of living in retirement, the agency
reported Tuesday. And few people surveyed in 2002
expected to retire before age 60. Only 22 per cent
planned to leave work before age 60, and only 44 per
cent planned to retire before age 65. The largest share,
45 per cent, planned to retire between 60 and 65. "Only
three per cent said they plan on retiring after 65. The
remaining 31 per cent said either that they don't know
when they plan on retiring, or that they do not intend
to retire," the agency found.
India: Move to boost pension reforms
— PPF likely to be phased out (September 1,
2003)
The proposed pension sector reforms are
expected to have a major victim, with the Government
considering phasing out the hugely-popular three-decade
old Public Provident Fund (PPF) scheme. The Government is
considering a gradual phasing out of the PPF scheme in
order to provide the pension sector with the necessary
`critical mass' to make the new structure viable. It is
being argued that if the PPF scheme is phased out, a large
portion of the deposits flowing into it would find its way
into the proposed pension schemes options since they would
also be offering similar benefits on tax, besides
providing old age income security.
India: Towards
Retiring An Old Pensioning System (August 30, 2003)
A gradual erosion of
traditional old-age support mechanisms and the rise in
elderly population highlights the need for strengthening
formal channels of retirement savings. As of now, there is
skewed coverage of the existing benefit schemes. It
favours the organised work force even as informal
employment is on the rise. There has been a worsening of
the financial situation of government pension schemes
against a background of rising expenditure, an
underdeveloped private annuity market and finally, the
need to increase the domestic rate of savings through
higher contractual savings, to strengthen the capital
markets.
Save Australia - keep working
(August 28, 2003)
Australia's baby boomers have been asked to ditch ideas
of an early retirement in the interests of the country's
future.The Federal Minister for Ageing, Kevin Andrews,
yesterday called for a huge change in attitude to tackle
the workforce problems arising from Australia's ageing
population."The change required of employees is to
abandon expectations of early retirement and ensure they
update their skills so they remain employable," Mr
Andrews told the Ageless Workforce Symposium in Sydney.
"From time to time, a particular generation of
Australians is called upon to rebuild our society in
order to secure its ongoing prosperity. That time is
now."
French may give up bank holiday to
fund elderly care (August 28, 2003)
The French government, struggling with the aftermath of
a deadly heatwave this month that killed up to 13,600
mainly elderly people, yesterday suggested cancelling a
public holiday to fund better care for the aged. The
secretary of state for the elderly, Hubert Falco, said
the idea was one of the possibilities being explored "to
try to establish genuine solidarity in the nation. It
would be a holiday on which people would work in the
cause of national solidarity."
Russia: VTB Arm Named Sole
Pension Depository (August 28, 2003)
The Finance Ministry named a state-owned
company the sole depository for pension funds Wednesday,
leading some to question the seriousness of the
government's pension reform plans.A subsidiary of
Vneshtorgbank, United Depository Co., or ODK, will hold
pension savings accounts for those Russians who choose
an asset manager, Deputy Finance Minister Bella Zlatkis
told reporters. ODK will oversee investments made by
companies that are given the right to manage pensions
after those firms are announced Sept. 8, she said.
Pension accounts for those who do not choose an asset
manager by Oct. 15 will automatically be channeled to
state-owned Vneshekonombank.
Italy:
Italy Seeks to Raises Retirement Age (August 25, 2003)
Premier Silvio Berlusconi's proposal to reform Italy's
pension system by raising the retirement age by five
years was received with caution Monday by his
conservative allies. With Italy's aging population and
declining birthrate, reform of Italy's pension system
has been a key, albeit thorny, issue for governments in
the last decade. The premier said in an interview
published Sunday that Italy "needs to raise the
retirement age by five years."
UK: No release for elderly from
income plans
(August 25, 2003)
More than 10,000 pensioners in the United Kingdome are
saddled with debts that they can never hope to repay
more than a decade after being sold home income plans,
consumer groups claim. Despite regulations against future mis-selling
and a campaign to secure compensation for victims, the
home income sales scandal lives on.
Brazil
States Seek Payback to Support Pension Bill (August
25, 2003)
Most of Brazil's 27 state governors want to obtain
concessions for their support on President Luiz Inacio
Lula da Silva's pension bill, which is scheduled for a
second-round vote this week, CBN radio station reported.
Opposition parties will attempt to derail the bill's
voting this week, the station said. The government and
allied parties reached a compromise to maintain the text
of the pension bill that was passed two weeks ago in a
first-round vote.
Japan: Pension funds calm
despite JGB jitters (August 25, 2003)
Japan's pension funds have remained a pool of
relative calm in recent weeks despite the volatility in
Japan government bond (JGB) prices. Funds have been helped
by equity gains that have offset bond losses, as well the
introduction of policies aimed at diversifying their
investment exposure across different asset classes.
Germany: Retire Later? Critics
Blast Pension Reform Ideas (August 24, 2003)
The commission exploring ways to save Germany’s pension
system has suggested raising the retirement age from 65 to
67. Politicians from across the spectrum have expressed
outrage at the idea. Today, 2.3 persons work
to support one retiree in Germany. But by 2030,
according to reliable demographic estimates, that ratio
could be more than halved. The Rürup Commission warns
that, without reform, pension contributions would have
to rise to between 24% and 25% of gross wages by 2030.
Right now they are 19.5 percent.
Germany:
Retirees may have to brace for leaner times (August
22, 2003)
The German government is reportedly
readying cutbacks in the country's demographically
challenged pension system. According to press reports in
the daily Handelsblatt and some other media, when the
Rürup Commission presents its reform proposals next
Thursday it is likely to recommend smaller annual
increases or even a freeze in pension payments. Also
expected from the commission, which is charged with
recommending reforms to the health and social systems,
is raising the official retirement age from 65 to 67 by
2025 and a ban on early retirements before age 64.
India:
Cabinet to take up new pension plan (August 22, 2003)
A contributory pension scheme for Indian government
employees and the proposed National Tax Tribunal will be
taken up by the Cabinet tomorrow, official sources said,
The new contributory pension scheme, managed by
independent fund managers, has been mooted by the
Finance Ministry for all government staff employed after
October 2002, as part of efforts to reduce the
government's pension liabilities.
Canada: Open Medicare to
private services: doctors (August 21, 2003)
The Canadian Medical Association is joining a Supreme
Court of Canada challenge to help reduce waiting lines and
guarantee care for Canadians.
The country's largest medical association is arguing
Canadians deserve health-care treatment in a timely
fashion and, if that can't be found in their home
province, it is incumbent on governments to pay for them
to go elsewhere.
Italy: Italy's High Quality of Life and Strained
Pension Plans
(August 20, 2003)
Amelia Antonetti retired nine months ago after 31
years as a high school teacher and now spends her days
looking after her husband and three grown children. All
the while, Mrs. Antonetti, 56, collects 90 percent of her
last salary and will do so for the rest of her life. The
laws that let Mrs. Antonetti retire when many countries
would still consider her to be of working age have helped
make Italy's quality of life among the highest in the
world. Those same laws are stretching the country's
pension system to the limit as the government struggles to
pay its obligations to a rapidly aging population.
Brazilian
State Employees' Retirements Surge, Folha Reports
(August 20, 2003)
Brazilian government employees are retiring at a faster
pace this year than last in response to planned changes
in the pension law, Folha de S. Paulo reported, citing
Ministry of Planning figures. The peak of retirements
this year was in April, with 3,537, Folha said, adding
that was the month the government sent Congress its
proposal to amend the constitution to limit civil
servants' pensions.
Korea: Pension scheme under
siege (August 20, 2003)
The national pension program is an insurance
scheme, under which the payment of benefits and other
expenses is financed with contributions from the insured
and their employers. The government plays the minimal role
of subsidizing farmers and fishermen to a certain extent.
If the current level of contributions and benefits is
maintained, the pension fund will begin to sustain losses
in 2036.
Japan:
Govt to tap pension system
reserve fund (August 19, 2003)
The government will dip into the reserve fund
of the public pension system to maintain payment of
benefits equivalent to more than 50 percent of the average
income for active workers, Health, Labor and Welfare
Minister Chikara Sakaguchi said Sunday. Sakaguchi said in
a program on NHK television that starting in 2004, the
fund reserve will fall to a level barely enough to pay
pension benefits for just one year in 2100.
Germany:
Germans Shun State-Backed Private Pensions, Institute
Says (August 19, 2003)
Germans are shunning government-backed private pension
plans introduced in 2002 and designed to reduce people's
reliance on state retirement benefits, the DIA Institute
for Pension Insurance said. The number of people
investing in private pensions fell to 5 million in the
first half of the year from 5.1 million in 2002. Some
300,000 pensions plans were canceled, exceeding the
200,000 new contracts signed in the first six months,
the DIA said.
Singapore: Singapore buffs the surface of an
unsound structure
In his annual national day speech last Sunday, Goh
Chock Tong, Singapore's prime minister, said the rate
would be cut and could drop to as low as 30 per cent from
the present 36 per cent, as Singapore revamped the savings
fund to reduce costs and stay competitive with other
regional cities. "With economic conditions so
unpredictable, it would be better to have a range of
rates, rather than a fixed rate, so that CPF contributions
can be cut in bad years and increased in good years," he
said.
Puerto Rico: Puerto Rico
government considers pension bonds (August 18, 2003)
Puerto Rico's Government Development Bank said Tuesday
it was considering a $500 million bond sale to help
address an $8 billion unfunded liability in its public
employee pension fund. Hector Mendez, president of the
bank that acts as fiscal agent for the Commonwealth,
said pension bonds are part of a larger plan forwarded
to the governor to shore up Puerto Rico's pension fund,
which provides benefits to the island's large public
service sector.
Russia: Pension Fund Misses
Notification Deadline (August 18, 2003)
Gearing up for the transition to an investment-based
pension system, the Pension Fund promised to send
account status notifications to all future pensioners by
Aug. 1. Not only did it miss the deadline, but it will
not be ready even by Oct. 1. As a result, management
companies and government officials have said the fund
should give people at least an extra month to pick a
manager for their pensions.
Japan: National pension system
collapsing as corruption spreads (August 12,
2003)
Since Japan's Social Insurance Agency took over the task
of collecting national pension insurance premiums in
April of last year; its account receivable has increased
by 200 billion yen. The national pension insurance fund
is now facing a dangerous financial crisis. The
bureaucrats do not seem to be aware of the seriousness
of the situation. They seem to believe that they can
resolve the problem simply by increasing the age at
which people are entitled to receive pensions and
decreasing pension payments…
Brazil: Brazil gov't plans to widen
pension coverage (August 8, 2003)
The Brazilian government plans to give pension coverage
to 40 million workers currently excluded from benefits,
Social Security Minister Ricardo Berzoni said on Friday.
"We want to present a bill in the second half of 2003 to
include domestic workers, the self employed and others
so that everyone can benefit," Berzoni said in an
interview on Globo television. No figures were given on
the cost of the additional coverage.
South Korea: Plan to Trim
Pensions Decried (August 8, 2003)
The government will lower the amount of pension payouts
again, to 50 percent of the average wage during the
contribution period. Labor strongly opposes the move and
warned that the labor-government dispute regarding the
five-day workweek system could spread to the national
pension issue. The umbrella union group also claimed
that the government bill lowered the value of the
national pension, and demanded that the government
maintain the payout rates but lower the insurance
premium rates instead. Stay tuned!
New pension plan lets you cherry
pick (August 7, 2003)
Under the new pension plan to launched by December,
individuals will not only get to choose the scheme, but
also pick the fund manager who is offering the best
possible return.The government is yet decide the number of
fund managers who will be allowed to operate, but will
review the earlier proposal of restricting the number at
six. Besides, the fund managers may even be allowed to
invest in overseas markets.
Brazil: Deal on pension reform reached
(August 6, 2003)
Brazilian
government leaders in Congress said last night they had
reached a deal that should enable approval today of a
controversial reform of the public sector pensions
system.The reform aims to tackle a long-standing deficit
in the system that has increased perceptions of risk
among investors and prevented the government from
lowering interest rates, an obstacle to faster economic
growth.
UK: FTSE
pensions debt tops £55bn (August 6, 2003)
Increased taxation, falling share prices
and rising bond prices have hit pension funds hard,
particularly final salary or defined benefit schemes.
FTSE 100 companies' pension scheme liabilities exceed
their assets by more than £55 billion, according to an
analysis of their accounts under the tough new FRS17
standard. Of the 90 companies in the FTSE 100 with final
salary funds, only 13 showed a surplus of assets over
liabilities last year.
UK: Don't be scared of
pensions (August 5, 2003)
“There is no doubt that the image and reputation of the
pensions system in this country have taken a bit of a
bashing over the last year or so. Dealing, as we do,
directly with the public we in the Pensions Advisory
Service (OPAS) have first hand knowledge of many of the
problems that are concerning consumers and how they are
reacting to them.” What is the problem?
South Africa: Ministers
clash about pensions – again (August 4, 2003)
National Minister of Welfare Zola
Skweyiya and his KwaZulu-Natal counterpart Gideon Zulu
have squared up for yet another bitter turf war after
allegations that the latter was using his portfolio for
political reasons.The fresh row between the two comes
after pensioners in Newcastle claimed their grants had
not been renewed because they did not attend an IFP
meeting.
Canada: Seniors wait for province
to rule on access to pensions (August 2, 2003)
The longer the issue simmers on the
backburner, the more Murray Pushka worries the provincial
government will stall on changes which would allow
retirees to access more of their pension funds. Pushka, a
former City of Brandon employee, and a group of local
seniors have been after the province to start granting
full access upon retirement to the 180,000 Manitobans who
have Life Income Funds (LIFs) and Locked-In Retirement
Funds (LIRFs)
Chinese Social Security Coverage Continues to Increase
(August 3, 2003) As the nation continues to increase social
coverage, more and more Chinese labors are now under the
coverage network. According to records provided by
the Labor and Social Security Department, percentage of
pensions distributed in full on time have raised from
95% in 1998 to 99.9% now.
Enterprise retirement social
management service is referred to “after retirement
formality, its management duty is no longer managed by
its original organization but the local community that
the retiree lives.
Pension is managed by the community service
organization that provides the corresponding management
service.” Until
the end of June, there were total 33,653 thousands
enterprise retirees in China. Among them, there were 17,516
already practicing the social management service. The rate
reached 52%, increased 8.5% comparing to last year. Experts
pointed out that this is important content in the
community protection system; it guarantees enterprise
retiree having a peace and happy life; it is an
important step for increasing living quality, also it
pushes community protection system to a fracture point
this year
Russia:
Pension Reform In Russia: A
New Stage (July 30, 2003)
In the summer of 2003, Russia took another step in
implementing its pension reform. Part of the pension
contributions paid by employers into the Pension Fund,
the state institution responsible for the provision of
pensions, have for a number of years been entered into
people's individual accounts. From 2004, this money will
be allowed to roll over. Returns from the process will
be accumulated and later paid as supplements to
pensions.
Australia: Calls
for retirement overhaul (July 29, 2003)
Australians would be encouraged to change to part-time
work before retiring and opt for pension-like
superannuation payments under an overhaul recommended by a
Senate committee. The committee has recommended a
move away from superannuation being paid in lump sums, and
suggested programs to help older Australians plan for
retirement.
France: France
approved pension changes last week in the Continent's
latest reform (July 29, 2003)
Not that anyone is proclaiming the
death of the welfare state, which has characterized
Western Europe since the end of World War II. German
workers still enjoy twice as many holidays as their
American counterparts, mandatory state insurance schemes
guarantee everyone almost cost-free healthcare from
Britain to Greece, and French government pensions will
remain generous however they are reformed. "The reforms
are not an attack on the welfare state so much as an
adjustment," says Willi Leibfritz, a senior economist at
the Organization for Economic Cooperation and
Development in Paris. "They are adapting the welfare
state to new challenges." Then why do civilians
protest?!
Slow German economy finds bright
spot in elder care (July 29, 2003)
Ralf Heinrich first
realized his tour company was in trouble in the summer
of 2002. Americans, who represented close to half his
turnover, were staying home after Sept. 11, 2001, and
his company's English-language historical tours of
central Munich were sparsely attended. So the
German entrepreneur started thinking what services he
could offer that would be more in demand. Since last
month, instead of whisking camera-toting travelers to the
Alps, he has provided home-care workers for Munich's
increasing ranks of seniors...
UK: War, Sars and pensions
batter BAA (July
28, 2003)
Complex emergencies and natural disasters affect us more
than we think. Profts at London airports operator BAA
slumped by more than 11% in the first quarter as post-9/11
security costs, extra pension contributions, the Sars
virus and the Iraq war all took their toll. Such decline
has resulted in a strike of the British Airways employees.
But who exactly can we blame now? Stay tuned!
Bangladesh: Mixed reaction to move to raise
retirement age (July 27, 2003)
Bangladesh - There has been a mixed reaction
among the civil servants over the government move to raise
their retirement age from 57 to 60. However, the majority
of the government officials are happy with the
recommendation of the Parliamentary Standing Committee on
Private Members Bills to put an end to contractual
appointments in the administration. The committee also
recommended that the retirement age be raised from 57 to
60. About the
government move to raise the retirement age, the senior
bureaucrats are happy, but the junior officials of the
rank of deputy secretary and below believe that the
decision would not solve the problem of promotion
backlog.
Hong
Kong: Ex-HSBC
pensions exec markets life-policy ABS (July 25, 2003)
NewHaven
is introducing a guaranteed bond to Asian institutions
based on senior life insurance settlements. It is
presently in talks with four or five large Hong
Kong-based institutions considering investing.
Humphreys' next marketing stop is Japan. The firm hopes
to launch its first senior life settlement ABS by the
end of the year, with a minimum of $60 million raised.
Tbilisi (Republic of Georgia) intends to pay pensions
with bonds (July 23, 2003)
Massive
protests and demonstrations in support of pensioners
resumed all over the country. Six members of Eternal
National Movement have been on a food strike in the Ministry of
Justice for a week now.
The major reason is belated pension
compensations. The opposition insists that the
Government close a 1,2 million lari pension debt to
elderly (about $600,000), which the current State budget
cannot cover. Commenting
on the situation, political secretary of the Eternal
National movement, member of the parliament Mr. Koba
Davitashvili, explained: “We are talking about miserable
pensions of 14 lari (about $6.50) hich elderly do not
get for months, and sometimes for years. If the
government consciously dooms these people to starvation
and death, we will share their fate, since we are not
able to do more”. (original text in Russian)
Pension reform has modified
political and trade-union’s prospective (July 23,
2003)
The bill on pension reform will be definitively
adopted on Thursday, July 24, by French National
Assembly and then by Senate. Two solemn votes will
ratify what François Fillon, the Minister for the social
affairs, called the "most important reform after
Liberation". Trade unions struggling against the Fillon
plan, gave up struggling. Now, opinions vary over the
inner tension among unions and why certain trade unions
chose to quit. Who will voice the interests of population?
(Original text in French)
Poor aging or Aging
poverty (July 23, 2003)
The
pension fund of Russia has decided to become accessible
for the future pensioners and make them happy with the
prospective of “careless aging”. However, Deputy
Minister of Finance said that internal and external debt
in 2-3 years will reach 25 and 75%, which means
additional billions of rubles must be invested in the
state bonds. This will allow the government to cover its
external debt. How will they achieve that? Pension
investments in the state funds will solve the problem.
As the result pension money will work for the purposes
of economy! (Original text in Russian)
Pensions: the bubble-wrapped
euphonium will do nicely (July 21, 2003)
UK - When considering a stakeholder pension,
try to avoid standing in a queue at the Post Office
behind someone bubble-wrapping a euphonium. From
personal experience, I can tell you that it doesn’t get
any better when you get to the counter. This was my fate
after putting to the test a happy-clappy,
"we’re-only-here-for-you" announcement from the Treasury
last year that stakeholder pensions were now available
at post offices. What could be simpler than just popping
into my local PO and getting a quick briefing on the
ease and simplicity of stakeholder pensions?
Pensions: Mestre CGIA, Accounts
Better, Reforms not Needed (July 19, 2003)
Rome, Italy, - The social security accounts seem to be
doing better: according to a study done by the Research
Office of the CGIA Trade Union of Mestre, the cover tax
(or the relationship between the contributions coming in
and the money paid out to pensioners) has risen from
61.5 per cent in 1992 to 71.4 per cent in 2002. Today,
for every 100 euro spent on pensions, 71.4 are
covered by contributions being paid in by those in
employment. However, the number of pensioners compared
to the number in employment continues to rise In 1982
they made up 60.4 per cent, now they comprise 70.6 per
cent. (original text in Italian)
MPs attack pensions change as
confusing (July 18, 2003)
Members of
British Parliament yesterday accused the government of
pushing through the new system of direct payment of
pensions and benefits into bank accounts simply to save
money and without regard to the "anxiety and confusion"
created among the vulnerable.
Strike at chemicals firm over
pensions (July 18, 2003)
More than 600 workers of French-owned chemical
firm “Rhodia” are on strike at two of its UK plants over
pensions. Workers are protesting over plans to close the
firm's pension scheme to new entrants. The decision to
end current pension arrangements for new members has
followed years of under-funding by the company.
Brazil's Lula
Prepares to Send Pension Legislation to Congress (July
17, 2003)
Brazilian President Luiz Inacio Lula da Silva presented
the pension reform legislation to the Congress on July
17. The proposal originally aimed to reduce the nation's
annual $20 billion pension system deficit. But strong
opposition from federal workers forced him to accept a
compromise bill that limits cuts to retirement benefits.
The bill presented today would reduce pension costs by
16.5 billion reais ($5.8 billion), or 4 percent less
than Lula's original plan.
Canada:
More pension troubles seen (July 15, 2003)
A new study suggests that Canada's top companies
are being overly optimistic about their troubled corporate
pension plans. The study points out that the surge in the
funding shortfall of companies’ pension plans means “more
pension pain to come in the form of rising deficits and
growing contributions in future years”. The funding
shortfall at Canada's largest companies with defined
benefit pension plans on the S&P/TSX 60-stock index
ballooned to $16.6-billion last year from $3.5-billion in
2001.
India:
Old-age pension scheme launched (July 15, 2003)
The Indian
government on July 14 announced two amendments to the
old-age pension scheme during a ceremony while Prime
Minister, Atal Behari Vajpayee, handed over policy
documents to pension beneficiaries. Amendments will
allow premature withdrawal of the pension amount after
15 years and a loan for a pension policy-holder from the
Life Insurance Corporation to the extent of 75 per cent
of the premium amount. The interest rate for the loan
would be 8.5 per cent per annum for now and revised
periodically.
Japan:
Recovery 'at risk from pensions shortfall' (July 15,
2003)
A study shows that Japan's top 300 companies have
pensions shortfalls totalling Y23,000bn ($196bn). The
figure is the difference between the companies' pensions
obligations and the value of the assets invested in their
pension schemes at the end of 2002. These future pensions
liabilities are likely to absorb recent recovery in
earning in Japanese companies.
UK:
Pension credits will be trouble-free, MPs told (July
15, 2003)
As payments of
pension credit will begin in October, the UK government
reassured MPs that the pension credit is “on track”. The
government used a "tried and tested" computer system and
had adopted a new approach of phased implementation.
However, many people are still concerned about the
complexity of the pension credit.
Brazil's Lula:
Pension-Reform Plans Should Stay Unchanged ( July 14,
2003)
Many
federal government workers went on strike to protest the
reforms to do away with existing benefits, such as
retiring with full salary and receiving pension benefits
tax-free. In response, President Luiz Inacio Lula da
Silva said on July 14, 2003 that his government's
proposal to reform the nation's retirement funds should
remain unchanged.
China:
35 billion not enough to cover the pension black hole
(July 14, 2003) (in Chinese)
The national
Pension fund has become the target of profit-seeking in
China. Some companies and individuals are taking
advantage of loopholes in the existing social pension
system for personal benefits. It seems the original
budget of RMB 35 billion is not enough to cover the
black hole. (The text is in Chinese. To read the Chinese
article, please install the Internet Explorer Chinese
language pack or NJ star communicator.)
Australia:
Financial illiteracy threat to retirement (July 12,
2003)
A study reveals
that few Australians have a financial plan in place, and
most are expected to depend on public pensions when they
reach retirement. About 80 per cent of Australians will
have an annual income in retirement of just $12,000. The
author warned that the situation “won’t change unless
Australians get up to speed with financial market
dynamics”.
Brazil strikers claim success (July
9, 2003)
Estimated
between 40% to 50% of Brazil’s 900,000 public sector
workers joined the strike to derail sweeping pension
reforms and have claimed success after the first day of
strikes. However, the country’s largest union
confederation has not joined the strike, instead opting
to try to negotiate changes in the reforms with the
government. Despite strikes, Brazil President Luis
Ignacio Lula da Silva has vowed to press ahead with the
reforms.
India:
PM to launch pension scheme on July 14 (July 9, 2003)
Indian Prime
Minister, Atal Behari Vajpayee, will launch a pension
scheme called `Varishta Bima Pension Yojana' in New
Delhi on July 14. The Finance Minister said the
government would set up a subsidised annuity scheme with
an interest of nine per cent for senior citizens between
55 and 79. The government may also consider increasing
the upper age limit under the yojana.
Canada:
Airline, unions hash out pensions (July 8, 2003)
As
Air Canada's pension deficit has grown to $1.8 billion,
the Office of the Superintendent of Financial
Institutions (OSFI) in Ottawa has recently expressed
"concern" in a letter to the insolvent airline "over the
lack of progress made in addressing the under-funding of
the Air Canada pension plans." Air Canada and its unions
will meet tomorrow and the growing deficit could
threaten the viability of concessions packages already
ratified by its nine unions.
Ghana:
GNAT scribe deplores delay in pension payments (July
8, 2003)
The
Ghana National Association of Teachers (GNAT) called on
the government to stop the delays in pension payments to
save retired teachers from dying because of misery.
Teachers expressed their disappointment at the
government for “taking the plight of teachers lightly”
as some of them who retired eight months ago have still
not been paid.
Israeli
labor relations no longer include pension commitment
(July 7, 2003)
Histadrut
(General Federation of Labor in Israel) chairman MK Amir
Perez again called for a pension law to require every
employer insure every worker in a pension fund. He said
that one million people will be penniless in 20 years
and a pension for every worker must be legislated.
Japan:
Welfare breaks for elderly divorcees hit (July 4,
2003)
The
Japanese Health, Labor and Welfare Ministry announced a
welfare proposal that would divide employee pension
benefits between salaried employees and their dependent
spouses. Currently, salaried workers' dependent spouses,
mostly women, are not required to contribute to the
national pension system but are able to receive basic
pension benefits in their old age. But some members of
the ruling Liberal Democratic Party criticized the
proposal would only drive up the divorce rate.
Chinese
Finance Ministry suspected to mismanage social
security fund (July 3, 2003) (in Chinese)
The Chinese
Auditing Department is investigating a 6 billion Yuan
social security fund, managed by the Social Security
Department of Finance Ministry. Profits of the fund in
the form of interest are suspected to have been
distributed to a group or even an individual. (The text
is in Chinese. To read the Chinese article, please
install the Internet Explorer Chinese language pack or
NJ star communicator.)
France
Passes Law Overhauling Pensions as Opposition Crumbles
(July 3, 2003)
Despite
serious strikes in protest of the pension reform bill,
the French National Assembly (lower house of parliament)
passed by 389-132 the law that will raise the number of
years people pay into the state funds and grant tax
breaks for private retirement plans. The new pension law
increases the number of years civil servants need to pay
into the mandatory state pension fund by 2 1/2 years to
a total of 40 years to bring them into line with those
of private employees.
France May Pass Law Granting Tax Breaks for
Pensions (July 2, 2003)
The
French National Assembly, France’s lower house of
parliament, will vote on a law of granting tax
incentives to private pensions. This move is expected to
attract at least 100 billion euros ($116 billion) in
savings over the next decade. The law includes creating
tax-deductible retirement plans for individuals and
incentives for a new corporate retirement plan.
India:
UTI Mutual Fund plans foray into pension sector (July
2, 2003)
UTI Mutual Fund,
the biggest fund in India, plans to bid for setting up a
pension fund once the government lays down Pension Fund
Regulatory and Development Authority in October this
year. The Finance Ministry
plans to open up the country's pension sector to
private players.
The Pension Fund will get
Russians thinking of aging (July 2, 2003) (in Russia)
By August 1st, 40
million Russians will receive notification from the
pension fund on the amounts available on their pension
accounts. Such notification letters will also be sent to
men younger than 50 and women younger than 45, in order
to increase their consciousness on the pension issue.
According to the new regulations, each citizen has the
right to choose the company (whether public or private)
that will be authorized to manage his/her pension
savings. This new regulation will grow into a big
concern for those citizens who receive “under the table
money” from their employers. “Zero balance on pension
accounts will get them thinking!” – says Deputy Chief of
Pension Fund. (The text is in Russia.)
Russians will be able to
check their pension accounts online (July 2, 2003) (in Russia)
In early July, the Pension
Fund will demonstrate the trial version of pension
software to the Prime Minister. The software will make it
possible for Russian citizens to check their pension
accounts, relocate to another pension funds, make
investments. The government hopes that the pension system
will become more reliable and stable. (The text
is in Russia.)
U.K.
May Lift Retirement Age to 70, Ease Pension Cost (July
2, 2003)
The
UK government may raise the mandatory retirement age
from 65 to 70 and make it illegal for companies to force
workers to retire any earlier. UK Industry Secretary
Patricia Hewitt proposed the age raise, which aims at
stopping discrimination against older workers. She
believed ``it will provide more choice and flexibility
for those who wish to stay in work.''
Australia:
$800,000 to keep up with pe nsion (July 1, 2003)
Economists warned that a predicted fall
in interest rates would see the already poor returns
on investments deteriorate even further for struggling
retirees in Australia. In comparison with couples
receiving pensions from Centrelink, self-funded
retiree couples now need $800,000 in interest earning
assets to be as well off as Centrelink aged
pensioners.
UK:
Barclays launches low-risk pension scheme (July 1,
2003)
Barclays in UK has launched a
new lower-risk pension scheme, called Afterwork, which
will guarantee staff a percentage of their pension pot.
The scheme, with two elements, the Credit Account and the
Investment Account, offers greater security. The Credit
Account is guaranteed not to fall in value and it may even
go up to reflect inflation and investment performance.
Czech:
Government finally opens a door to pension reform
debate (June 30, 2003)
The current Czech coalition
government opened the door for a debate on pension issues
by announcing a reform proposal recently. It was less than
a year ago when pension reform was almost unmentionable in
the Czech Republic. The Czech Pension Fund Association
(APF) has a reform proposal to allow employees options to
use their social security to invest in pension funds.
Europe's
retired face pension squeeze (June 30, 2003)
A
population that is both living longer and producing
fewer children has produced political uncertainty and
crowds of angry demonstrators in European countries.
Reacting to the shift from youth to the aged,
governments are moving to reduce social services,
including the pensions that millions have been counting
on for their golden years.
Japan:
Ministry considers minimum pension (June 30, 2003)
The Japanese Ministry of
Health, Labor and Welfare is considering lowering the
minimum level of pension payments from 59 percent to 50 to
55 percent of the average net income of the active
workforce. It also is tackling the situation where, as a
result of declining birthrates or economic conditions
becoming worse than expected, the level of pension
payments under the new plan falls below 50 percent.
UK:
Older staff set for lower redundancy (June 30, 2003)
A forthcoming law in UK will reduce
the redundancy pay for older workers who lose their
jobs. According to the law, employees aged 41 and above
must receive payment of at least a week and a half pay
for every year of service above the age of 41 with their
employer. Under the new proposal, that payment would be
only one week for each year. Age campaigners accused the
proposal as another blow for the beleaguered older
worker.
China: Two Years to Establish a
Social Management System for Enterprise Retirees (June
29, 2003) (in Chinese)
China Labor and Social Security Department
recently urged relevant governmental agencies at all
levels to complete the establishment of a social
management system for enterprise retirees within two
years. The system requires community service agencies
rather than retirees’ companies to handle pension
payments and provide services to retirees. Nationwide,
49.4% of the enterprise retirees are currently in the
social management system. (The text is in
Chinese. To read the Chinese article, please install the
Internet Explorer Chinese language pack or NJ star
communicator.)
Russians
to get pension accrual notices beginning July 1 (June 27, 2003)
During his visit to Pension
fund’s information center, Russian Prime Minister
Mikhail Kasyanov said pension reform would be felt by
virtually every person, beginning July 1, 2003. He said
“Russian residents will be updated on their pension
accruals, i.e. the sums their employers have paid to the
Pension Fund”.
Brazil
Congress to Skip Break for Tax, Pension Bills (June
26, 2003)
Brazil's President Luiz Inacio Lula da Silva
called on lawmakers to speed up consideration and
passage of pending legislation. Lawmakers agreed to skip
a July recess to vote on president’s pension and tax
bills. The bills are aimed at reducing the budget
deficit and ensuring Brazil can keep up payments on $400
billion of debt. He said the tax and pension
bills are needed to spur economic growth and “create the
jobs that we want to create''.
India: Nod for IOC, ONGC early retirement
plans (June 25, 2003)
The Indian government today
approved the voluntary retirement schemes proposed by the
Oil and Natural Gas Corporation (ONGC) and the Indian Oil
Corporation (IOC). According to the schemes, employees
choosing voluntary retirement will be paid a compensation
of 60 days' salary for each completed year of service or
the salary for the number of service years left, whichever
is less, apart from the normal retirement benefits. They
would also receive additional monetary benefit. It is estimated that about 2,000
employees of ONGC and 1,000 in IOC will opt for
voluntary retirement under these schemes.
Israel: Scores of port employees
apply for early retirement (June 25, 2003)
Many employees aged 50
and above at the Haifa and Ashdod ports in Israel have
applied for early retirement because they are worried
about pension reforms.
Many other employees at the ports have asked the
Ports Authority for advice regarding the significance of
the pension reform to them.
Iraq: Ex-soldiers to
receive pensions (June 24, 2003)
The
U.S.-led administration will begin paying pensions to
former members of Saddam Hussein's military. Up to
250,000 former career soldiers will be eligible for
pensions starting from July 14. Depending on the rank,
the payment will be from $50 to $150 a month, about what
they earned on active duty.
South Africa: Logistical problems
blamed for pension payment hassles (June 24, 2003)
Cash Paymaster Services
(CPS), one of two companies responsible for the
distribution of social grants in the Eastern Cape
province, South Africa, was blamed for bad services such
as long queues, late arrivals, the length of time taken
to process grants and the location of paypoints. The
Eastern Cape government threatened to take back six
districts in which CPS recently began operating. The
chairperson of CPS said a number of logistical issues
have contributed to these problems around pension
payouts in the Eastern Cape.
Brazilian judge set to
challenge pension cuts (June 23, 2003)
Following a protest meeting
last week, the head of Brazil's Supreme Court rejected the
government proposal to have their pensions taxed and
capped at R$2,400 (US$ 832) and demanded the right for the
judiciary to present its own reform plans. It is the most
serious threat yet to the government's pension reform,
which aims to reduce an annual social security deficit of
5 per cent of gross domestic product.
Japan:
Elderly can contribute monetarily to society (June 23, 2003)
As consumption remains
stagnant due to the ongoing economic downturn in Japan,
the government is trying to reduce pension benefits in
order to contain growing social security spending. The
author of the article believes that senior citizens can be
seen as vital to the economy in this sluggish economy due
to their purchasing power. However, he also points out
that “moves are afoot to stifle these elderly geese before
they can lay their golden eggs”.
French MPs approve key pension reform
(June 20, 2003)
The French National Assembly
(lower house) approved to increase the number of years
worked for a full pension by 87 votes to 20 on June 20.
After 10 days of debates, this key article in a
controversial pension reform bill that has led to
nationwide strikes and transport chaos passed the lower
house.
UK: Sun, sea and a lump sum
keeps the sangria flowing (June 20, 2003)
In the U.K., strict rules
force people to spend three-quarters of a personal pension
fund on annuities. As a result, less restrictive rules on
pensions makes retiring abroad attractive, and many people
retire to countries such as France, Spain, Ireland and
even Australia where the rules about what one can spend
the personal pension fund on are much more relaxed. But there are
dangerous hazards involved.
Japan: The pension system in
peril (June 18, 2003)
As the economy
turns down and aging accelerates among the population,
Japan’s pension program registered a nearly 700 billion
yen deficit in fiscal year 2001. The author is worried
about the deficit, saying “it reflects a continuing
deterioration, not just a temporary decline, in public
pension finances.”
Pension plea sent
to all French homes (June 17, 2003)
As the pension reform sparked weeks of
strikes in France, French Prime Minister Jean-Pierre
Raffarin is sending a personal letter to every French
household to explain why the reforms are essential to
deal with the growing number of the elderly. In an
attempt to be involved in the discussion, workers’
strikes disrupted education, transport, and other parts
of the public sector as unions maintained their
opposition to the plans. The union is planning its next
wave of strike within a week.
India: LIC postpones
pension plan for senior citizens (June 17, 2003)
Life Insurance
Corporation announced today in Mumbai, India to postpone
the launch of Varishtha Pension Bima Yojana, a
government-subsidised scheme for senior citizens aged
between 55-79. The government is likely to launch the
scheme within a month.
UK: Red faces over
wrongly-worded pensions green paper (June 17, 2003)
The British
government’s pensions green paper was found in
contradiction with ministers’ speeches last week. The
Department of Work and Pensions will be forced to send out
hundreds of letters explaining the new wording. It has already taken
several days for the department to clarify the situation
and admit the wording was wrong.
Canada: Pension tax laws
loosened (June
16, 2003)
The Canadian
government has loosened the federal tax laws to allow some
funds to generate larger surpluses to help withstand
market downturns. New regulations extend the contribution
limit from 10 percent to 25 percent.
UK: Legal loophole
threat to pension safety (June 16, 2003)
A lawyer warned that a
loophole in the British draft law could threaten the
effectiveness of the promised pension safeguards for
members of final salary schemes. The government-funded
Occupational Pensions Advisory Service said it feared
members might not receive the protection promised. The
government laid down the draft regulations, which
require solvent employers to pay pension entitlements in
full if a scheme is wound up.
South Africa:
Radical Measures Set to Overhaul Pension Funds (June
13, 2003)
The South African Finance
Minister proposed radical changes to reverse the
near-fatal decline in the pension funds industry. He
proposed to increase investment opportunities for small
pension fund with values below Sh5 million, raise the
maximum ceiling per contributor to SH20,000, and reduce
the vesting period for employer contributions to three
years. These
measures addressed the failure of companies, workers
benefits and required vesting periods.
French Strike Against Cuts in Pensions
Jams Traffic (June 11, 2003)
Protests against the reform of the
French pensions system veered towards outright revolt
yesterday, with tens of thousands of teachers and
transport workers tied up traffic in Paris. The
demonstration, coinciding with the start of a
parliamentary debate on pensions reform, turned the
boulevards and avenues of central Paris into a sea of
blocked cars. The legislature is expected to vote on the
bill in a few weeks.
Israeli pension reform
possibly costly to banks (June 11, 2003)
The pension reform in Israel is expected to be
costly to the banks due to their streamlining programs
in recent years. Some of the banks will be faced
with hundreds of millions of shekels in added costs. The
reform includes allowances for the early retirement of
hundreds of employees.
Angola:
Portugal Has No Objections Concerning Pension Payment
(June 10, 2003)
The Portuguese
ambassador to Angola said Tuesday that Portugal has no
"Philosophical objections" with regard to the payment of
allowances to the Angolan pensioners of the then
colonial administration. The ambassador said he
understands perfectly the legitimacy of the claims.
France suffers fresh strike
chaos (June 10, 2003)
France is in the grip
of fresh nationwide strikes which are severely hitting
transport and education. Militant trade unions virtually
brought the country to a halt on the day the government
put its pension reform plans before parliament.
Indian
Government may allow more than six pension funds (June
10, 2003)
The Indian Cabinet,
moved by the finance ministry, may allow six or more
pension funds in the new sector. The ministry had
earlier restricted the number of pension funds to six
because allowing too many options could create problems
of choice for the depositors. But the government
loosened this restriction, as several domestic mutual
fund companies as well as fund management companies from
abroad have sent delegations to protest restrictions on
the number of pension funds. It may be very difficult for
workers to detect which plan is better than another. High
advertising costs, administrative costs, and
profit-taking reduce
the amount of monies available to be returned in
pensions.
UK: Strike expected
in defense of final salary pension scheme (June 10, 2003)
A British union said that workers
at a chemical company were expected to vote to strike over
keeping its final salary pension scheme open to future
workers there. Last year, workers at Caparo, the steel
company, were successful in Britain's first strike in
defense of a final salary scheme for existing workers.
These disputes highlight the rapid rise of pensions to the
top of the trade unions' agenda.
New Zealand: Few Kiwis saving
for super (June 9, 2003)
A survey shows that less than half
of New Zealanders are actively saving for their retirement
despite their disbelief of superannuation for old-age
income support. The survey found 75 percent respondents
said “current superannuation levels were not enough to
support them in retirement.” However, only 49 percent are
saving for their retirement.
UK: Unions' warning on safety net
for pensions (June 9, 2003)
Bad news for British pensioners. Andrew Smith,
the British work and pensions minister, announced plans
this week to scrap the rule to raise pensioners’ payment
to adjust for inflation. Union leaders yesterday warned
ministers not to remove the schemes that protect millions
of pension scheme members from rising prices. Union
leaders also welcomed plans to bring in a safety net to
pay pensions to employees of bankrupt companies.
South
Africa: Government Denies Pension Fund Liability (June
8, 2003)
The South African National Treasury said in
a brief statement on Friday that the miscalculation in
the consumer price inflation (CPIX) and the revision of
the figures in late May was a technical shift rather
than a fundamental. The difference between a fundamental
and technical change is critical, since pension funds
have to bear a loss of about R700m as a direct result of
the revision.
Canada: Top court will hear
pension case, Judges to tackle who gets
surplus (June 6, 2003)
The Supreme Court of Canada will
hear the case over whether pension surpluses should be
divided at the time of a mass layoff, a widely watched
case involving 146 former employees of Monsanto Canada
Inc. Two lower courts in Ontario have already ruled that
companies are required to pay a share of any surplus at
the time of a mass layoff.
Europe: Generation gap (June
6, 2003)
Governments across
Europe are struggling with an explosive issue: how to
reform pension provision for the elderly without
alienating the young. The article analyzes the pension
situation in Europe, following strikes in several
European countries in the last month.
Japan: Fiscal panel urges
review of pension benefits (June 6, 2003)
The Japanese Fiscal System Council
will submit the report on June 9, 2003, to the Finance
Minister, stating that cuts in pension benefits to both
current and future beneficiaries may be considered to
alleviate the deteriorating financial health of the public
pension scheme. It is the first time that the council has
specified the need to consider a reduction in the level of
pension benefits.
Barbados:
Dr. Williams calls for restructuring of private pension
plans (June 5, 2003)
The World Bank ideology to
privatize pension funds has hit the Caribbean as speeches
as a major conference reveals. However, the twin issues of lack of
jobs for working age persons and the absence of
contributions from workers in other countries may change
some governments’ minds about the wisdom of privatization.
At the opening of a three-day
symposium yesterday, Dr. Marion Williams,
the Governor of the Central Bank of Barbados, called for a
restructuring of private pension plans. He said “while
such reforms had already started, many of the
considerations discussed in the context of public funds
need to be applied to private pension funds as well.”
Firms cut cap
spending to plug pension holes-survey (June 5, 2003)
Some 22
percent of mid-sized firms in four of the world's
largest economies are cutting capital spending due to
the gap between current assets and expected pension
liabilities. Firms in Britain, the United States, Canada
and Holland with underfunded pension schemes are
changing their business plans as a result of the big
gap.
The
Retirement and the withdrawal (June 5, 2003) (in
French)
In a Le
Monde editorial, the writer acknowledges that the
government has appeared to win its effort to match the
retirement age in the public sector with that in the
private. However,
Le Monde decries the government’s methods which imposed
this “reform” without dialogue or widespread discussion
with the unions and other affected workers and their
families. The
government ignored the
“social contract” which will make governing less
democratic in the future.
West
Europe Is Hard Hit by Strikes Over Pensions (June 4,
2003)
Sharing the same grievance
over governments’ proposals to change the national pension
systems, protesting workers in Austria and France shut
down subway systems, ports, trains, toll roads and
airlines today. Smaller strikes also erupted in Italy and
Germany. Flight attendants at Alitalia, the Italian
airline, called in sick to protest job cuts, while
steelworkers in eastern Germany picketed factories to
demand the same 35-hour work week that their counterparts
in western Germany have.
The
mobilization weakens, Mr. Raffarin asserts his
"determination" (June 4, 2003) (in French)
The
demonstrations against the Fillon’s project on retirement
gathered less protesters that on the preceding event of
May 13. The
strike, notably in the transportation sector, did not
provoke the dreaded paralysis. The prime minister is heard to
continue "to reform"
He has anxiously mobilized the National Assembly
with the statement: “You can count on the determination
of the government to reform the Republic as we are
moving to the matter of the survival of the Republic”. (Full text in
French)
For
the referendum on pensions (June 4, 2003) (in French)
Retirement used to
considered « the antechamber of death » Europeans
used to stop working at 65 in order to die at 70. Today,
retirement has become a second life; it combines hard
work and fear of not having a pension at the end. France
must face the demographic distortions immediately, but
this distortion is noted as a new plateau, not a new
tendency. Either in hundred years or in fifty, the
choice will be the same: what portion of wealth will go
to the active citizens and what goes to the retired
ones, in the world where there will be many of both? While the
debate on retirement looks simple, the case of
retirement is very explosive.
Canada: Reform seen in
reporting firms' pension obligations (June 3, 2003)
As the tumult in stock
markets over the past three years has depleted the
surpluses of many pension plans, the accounting profession
in Canada is considering write tough new rules for how
companies report their long-term obligations to retired
employees. The Accounting Standard Board head said the
process to review accounting rules for pension plans will
likely be a lengthy one.
China:
Firms to sign pension pact (June 3, 2003)
China’s National Council for
Social Security Fund is expected to sign agreements with
six domestic fund management firms to allow them to invest
a greater proportion of the pension fund in China's stock
markets. The fund will give each company a proportion of
the money ranging from 2 billion yuan (US$240.96 million)
to 3 billion yuan to invest in the two local-currency
Class-A share markets in Shanghai and Shenzhen.
Israel: Insurance Supervisor appoints temporary
supervisors for 4 old pension funds (June 3, 2003)
The Israeli Insurance
Supervisor today unexpectedly announced the appointment
of special temporary supervisors for the management of
four older pension funds, which have an aggregate
actuarial deficit of NIS 140 billion. This is seen as an
action of the Ministry of Finance to impose its pressure
on the Histadrut (General Federation of Labor in
Israel).
Kenya: MPs shield Moi in
pension battle (June 3, 2003)
In Kenya, the MPs,
led by opposition leader Uhuru Kenyatta, were unhappy
with the Presidential Retirement Bill, which bars
beneficiaries of the pension scheme from participating
in politics. The MPs warned the Narc government against
harassing retired President Moi and called for changes
in the Bill.
Austrians In Mass Walkout
Tuesday To Protest Pension Cuts (June 2, 2003)
Austria experienced a second
wave of crippling strikes within a month Tuesday. The
strike came after talks between the government and the
Austrian Trade Union Federation broke down. The first mass
strike this year was on May 6, to protest at government
plans to save more than EUR2 billion over the next four
years by slashing state pensions.
France: Pensions
nouveaux (June 2, 2003)
As unions are furious about
the reform plan, France faces another strike this week.
The French government has tried to reform the pension
system in 1990s, but failed due to tremendous opposition
and protests. This
time Mr. Raffarin appears to have more firepower, as
opinion polls show the French are aware of the need for
reform. As the French government tries to
forestall a pension crisis, Europe watches and unions
seethe.
UK: Move for compulsory
insurance for pensions (June 2, 2003)
As pressure mounts on the
British government to provide a safety net for workers,
proposals for a compulsory insurance scheme for final
salary pensions are being drawn up. Representatives from
the Department of Work and Pensions and the Government
Actuary's Department, met executives of the US Pension
Benefit Guaranty Corporation last month. They studied
pension insurance and regulation schemes in Finland,
Japan, Germany and the Netherlands.
The Politics
of Public Pension Reform (May 2003)
Public old-age pension
programs are the largest single item of public
expenditures in most advanced industrial countries.
These pension systems have been buffeted by a number of
pressures for change in recent years, however, notably
an aging population, slower revenue growth, and
competitive pressures to limit payroll taxes. Thus it is
hardly surprising that pensions have received much
attention from policymakers, and caused enormous
political conflict, both in the United States and
abroad. Policymakers have three very broad sets of
options for responding to the increased funding demands
of their pension systems: they can cut back on the
generosity of specific provisions of their pension
programs through retrenchment, refinance their pension
programs, or restructure their pension programs. This
paper attempts to understand cross-national patterns of
pension policymaking as well as distinctive patterns in
the United States. For executive summary, click www.globalaging.org/pension/world/sum.pdf
Whose
Money is it Anyhow?: Governance and Social Investment in
Collective Investment Funds (May 2003)
Over the past two
decades, an aging population and budgetary stress have
led to substantial changes in public pension systems
throughout the world. Many countries initially responded
to pension funding crises with incremental reforms. A
number of countries have also engaged in a more
fundamental restructuring of their pension systems.
These seemingly disparate responses to the pension
funding crisis in fact raise a common set of issues
about the public/private divide in governance of such
funds. This paper examines how several OECD countries
have addressed the “public/private divide” in collective
investment "buffer" funds, drawing on the experience of
Canada, New Zealand and Sweden, as well as the Swedish
experience with a “default fund” (for those who do not
make an active fund choice) in the individual account
defined contribution tier of its public system.
For executive summary, click www.globalaging.org/pension/world/investsum.pdf
India: Pension to
cover state staff, voluntary sector (May 30, 2003)
The Indian government is
planning to implement a new pension plan first for the new
civil servants and voluntary sector people. The new plan, a defined
contribution scheme, will pre-define the contribution to
the scheme. The returns are provided to the members
based on the performance of the scheme and not
guaranteed.
Japan finalises rules for pension
asset transfer (May 30, 2003)
Japan's
Health Ministry on Friday finalised rules for the
transfer of assets from corporate schemes to the state
pension fund. According to the new rule, the handover is
allowed starting from September 1 and corporate funds
can hand back an amount set by the government in either
cash or securities. It is estimated that this new rule
could affect 10 trillion yen ($85 billion) or more of
assets.
Pension schemes under pressure
(May 30, 2003)
A two-day
conference, jointly organised by Insurance Regulatory
and Development Authority, Paris-based Organisation for
OECD, Institute of Insurance and Risk Management and
International Network for Pension Regulators and
Supervisors, is being held in Hyderabad, India. It
discussed the increasing pressure on pension schemes
across the world, particularly in developing countries,
due to low returns on investments and public reluctance
to join them.
Four unions call for the
« general mobilisation » (May 29, 2003) (in
French)
The determination of
Jean-Pierre Raffarin to continue with the reform, has
met strong opposition from labor unions. The unions have
arranged for the major meeting to plan their further
actions. The suggested strategy is to amplify the
mobilization and to organize general strike and
demonstrations on 3rd June. "Only general
movement of public and private entities, will make the
government revise
its harmful decision," stated the four unions. They
reaffirmed that "there is a requirement of a true
negotiation and of a democratic debate to construct the
reformation project guaranteeing the future of the
retirement." (full
text in French)
Pension : The
government takes firm position facing the unions (May 28, 2003) (in
French)
On 28th
May, the Council of Ministers legally approved the
project of pension reform. The Secretary of the State,
Mr. Fillon has announced this reform “well-grounded and
urgent,” as it is a “must” for public affairs. The
Unions have been officially warned on Europe 1, that the
external pressure cannot be made on the parliament
discussion. President Chirac and Minister on Social
Affairs Mr. Raffarin do not intend to revise the project
on reforming pension system after its adoption by the
Council of Ministers. Does this mean the final point has
been made on the first phase of the reform?! (Full text
in French)
Brazil's Pension Bill
to Lure Investments (May 28, 2003)
Brazilian
President Luiz Inacio Lula da Silva's efforts to overhaul
the nation's pension system and slow inflation attracts
more U.S. investment in the country. While the California
Public Employees' Retirement System endorsed the idea of
investing in Brazil, the social security reform and
reduction of government spending is critical for Brazil to
continue to attract more foreign capital.
French Cabinet approves pension reform plan
in face of strike threats (May 28, 2003)
France's centre-right
government today approved a draft bill to overhaul the
country's costly public sector pensions system,
signalling its determination not to back down in the
face of mounting union protests. But the unions showed
little sign they were willing to lower the tempo as they
prepared for another day of national action on Tuesday.
Australia:
Hollingworth pension plan under fire (May 27, 2003)
Tanya Pibersek, Australian Labor MP,
said today that “ordinary Australians would be disturbed
at the size of the governor-general pension”. She claimed
that Mr. Hollingworth's pension, worth more then $180,000
a year, seemed excessive.
Canada: Policy options for
the pension crisis (May 27,
2003)
While Canadian Prime Minister Jean
Chrétien claims changes to the Canada Pension Plan will
leave it financially sound for the rest of this century,
others want more
radical changes in retirement plans. Several policy
options are suggested in dealing with the challenges that
Canadian pension system is facing.
India: No fixed pension
for new government employees (May 27, 2003)
New government
employees in India will have to shell out 7.5-10 per
cent of their basic pay towards pension. And the
government will not guarantee any fixed pension. The
current system grants government retirees an assured
pension, which is at present 50 per cent of their last
drawn salary. The Indian finance ministry will soon
place a proposal before the Cabinet to operationalise
the new pension system.
New Zealand: Retirement
age chewed over (May 27, 2003)
In New Zealand, 25
percent of meat workers over 50 would not retire at the
age of 65. Some are concerned that people in manual
jobs, especially meat workers, may feel obliged to keep
working after they turn 65 even though they are not
physically capable. To deal with a ballooning
superannuation bill, Treasury of New Zealand suggested
pushing the retirement age from 65 to 70.
Swiss push to
raise retirement age (May 27, 2003)
The Swiss government
faces a hard time to cope with the rapidly increasing
pension deficit as life expectancy rises, birth rate
decline, and the stock price slump. It is estimated that
the ratio of workers to retirees will increase from
three to one today to three to two in 2040. Swiss
President Pascal Couchepin plans to increase workers'
retirement age to 67 and decrease payments to retirees
to deal with the situation.
UK: Firms raise
retirement age for pensions (May 27, 2003)
A survery of 300
companies by Norwich Union shows that millions of
employees in U.K. could be forced to work for longer
years than they had anticipated to be eligible for their
company pension. Almost two-thirds of surveyed companies
are planning to raise the retirement age. Employees will
either have to work until the new higher age, or accept
lower pension incomes for a longer retirement. Will
older workers be protected against age discrimination on
their jobs?
Zimbabwe: $4bn missing
from ZESA pension fund (May 27, 2003)
The
Zimbabwe Electricity Supply Authority (ZESA) pension fund
is reported to have been prejudiced of more than $4.1
billion after the power utility apparently withdrew funds
to pay off exit packages to several workers who had
retired before their mandatory retirement age of 60 years.
Under normal circumstances, the pension funds are only
withdrawn to pay retirees, not used as exit packages.
German drug coverage bill stirs
heated debate (May 26, 2003)
Germany's
upper house of Parliament approved a motion on Friday
opposing a highly controversial law that would cut in half
the number of drugs covered by Germany's public health
insurance system. The proposed law is designed to save
Germany’s public
health insurance 800 million euros per year.
Nigeria: Prepare Ahead of
Retirement, Journalists Told (May 26, 2003)
Nigeria
Social Insurance Trust Fund boss, Mr. Victor Eborajolor,
has urged journalists to start preparing for retirement
by joining the trust fund while discharging their
duties. He said the Press
cannot be ignored in the society and journalists need
to join the trust fund to take care of their old age.
Workers March Through Paris to
Protest Pension Reform (May 25, 2003)
Hundreds of thousands of French
workers, teachers and students marched through Paris on
May 25 in a demonstration intended to step up pressure on
the government over pensions and other issues. The police
in the capital estimated that around 300,000 people
participated in the march while protesters claimed a much
higher turnout.
Urgent pension reform needed
in Italy (May 23, 2003)
Antonio D’Amato, the head of
Italian employers' body Confindustria called for early
implementation of the conservative government's pension
reform plans to boost the stagnant economy. The Italian
senate is currently discussing a framework law that
provides incentives to delay retirement. The bill may be
ready before the 2004 budget is presented in September.
Malaysia: LIAM proposes
private pension scheme (May 23, 2003)
The
Life Insurance Association of Malaysia, a health insurance
company in Malaysia, proposed to the government to
consider establishing private pension schemes. As most
retiring Malaysians might not have sufficient retirement
income by relying totally on their Employees Provident
Fund, private pension schemes aim to assist ageing
Malaysians achieve financial independence after their
retirement.
Sri
Lanka: Pension scheme, housing programme for estate
sector (May 23, 2003)
The
Sri Lanka Minister of Plantation Industries, Lakshman
Kiriella said Tuesday that a pension scheme for
estate workers and a housing programme of 10,000 estate
houses would be implemented this year to improve the
living conditions of the estate workers. He also said
that the pension scheme has already been formulated and
should be implemented before the end of this year.
Nigeria: World Bank abandon
N130b pension liabilities (May 22, 2003)
Director of
Nigerian Legal Services of Bureau of Public Enterprises
(BPE) indicated yesterday that the World Bank has turned
down the BPE’s proposal on how to assist in resolving the
pension crises. She also said that the Nigerian Federal
Government has decided to set up a new pension scheme
rather than fund the pension fund. BPE will sell some
non-core assets of the public enterprises to raise money
for the accumulated pension deficit. Will the sales of
public assets be enough to fill the pension gap without
other sources of funding?
Korea-China pension deal goes
into effect (May 22, 2003)
The Korean Ministry of
Health and Welfare said that a Sino-Korean agreement on
the exemption of pension fees for nationals residing in
each other’s country will come into effect this Friday. According to
the agreement, Chinese migrant workers in South Korea
and Korean residents in China will be exempt from
national fund premiums. This agreement was reached in
February this year. Will these workers exempt from
pension payment be covered by their own country’s
pension system once they are retired?
Conservatives predict £100bn
pensions black hole (May 21, 2003)
The Conservative party claims that expenditure on
benefits for older people will double to 10 percent by
2050, while the British government projects stable
spending at 5 percent. The Conservative party accused the
government of “massively understating” the true cost. It
predicts that spending on state pensions will blow a
£100bn hole in the budget.
United Arab Emirates: Etisalat
Academy hosts Pension & Social Security Forum (May
21, 2003)
Etisalat Academy
in the United Arab Emirates invited the General Pension
and Social Security Authority to a forum yesterday in Al
Ghusais near Dubai Airport Free Zone. Over 60 Etisalat
senior officials attended the day event, from the Head
Office in Abu Dhabi and from across the regions, including
senior HR managers, finance managers and IT staff dealing
with payroll and pension procedures.
India:
Pension norms under attack (May 21, 2003)
Private
players are not very happy with the Indian government’s
steep norms for entering the liberalised pension market.
And, for the Rs 300,000-crore plus pension market, the
reforms agenda is poised to be turbulent. Even as the
finance ministry issued a directive two weeks back on
pension reforms, a nation-wide campaign against the
skewed entry norms for private participation is building
up.
Japan: Pension reforms target
women (May 21, 2003)
The Japanese
Health, Labor and Welfare Ministry is currently debating
ways to reform part of the national pension system in
which full-time homemakers can receive pension payments
without having paid premiums. Analysts expect the ministry
will face difficulties in coordinating the revisions as a
possible change in the pension system may affect women's
future plans.
Canada: Most pension plans in
trouble (May 21, 2003)
Even though many workers pay into company
pension plans, their benefits aren't entirely guaranteed,
the Canadian federal regulator warned Wednesday. As many
as 75 company pension plans in Canada have been
red-flagged as being in some trouble, said Nick Le Pan,
head of the Office of the Superintendent of Financial
Institutions.
Israeli Government holds
'safety net' for older pension funds (May 21, 2003)
The
Israeli Finance Ministry will set aside NIS 7 billion as
a safety net to guarantee the yield of the veteran
pension funds does not fall below a certain minimum. As
part of the proposed economic recovery plan, the
government intends to send the veteran pension funds,
which because of actuary deficits stopped accepting new
clients in 1995, to the capital market.
UK: Pensions probe may not
please ministers (May 20, 2003)
Adair Turner, the
British government's pensions supremo, is to scrutinise
the impact of the state system on private pension saving,
although his terms of reference specifically prevent him
from recommending changes to the state pension structure.
The investigation may not please ministers, who insist the
present state system does not need changing. But it will
be welcomed by the growing number of voices in the
pensions industry who argue that private saving is
unlikely to be revived without a simpler state system and
less means-testing.
India: First pension fund to be
set up in October (May 20, 2003)
The first
of the six pension funds to be set up in India is to be
launched on October 2nd, well in time to operationalise
the new pension scheme for government employees joining
after October. The modalities for the pension funds will
be decided by the Interim Pension Regulatory Authority.
EU: Lifting tax rules 'would aid
retired workers' (May 20, 2003)
The average
retired worker would see his or her pension pot rise by
about €120,000 (£86,000) if Europe's asset management
market was liberalised, according to research released
yesterday. The Investment Management Association, the
industry body, said removing regulatory and tax barriers
could boost the value of investments across Europe's
asset management industry by about €5bn a year.
UK: 'Safety
net' urged for final salary pensions (May 19, 2003)
The UK's
top pension fund representative is to call on the
government to create a national compensation scheme, or
"safety net", for members of final salary pension plans.
Terry Faulkner, chairman-elect of the National
Association of Pension Funds, said the government should
"think very seriously" about member protection. "With
23m people covered by final salary plans, it's a matter
of great public interest."
French
Civil Servants March Over Pension Reform (May 19, 2003)
French trade
unions, divided over government plans to reform the state
pension system, launched new strikes Monday that hit
electricity output, schools and hospitals, though public
transport ran normally. In Paris, some 100,000 protesters
braved the rain to march against reforms that will push
back the retirement age of many French workers from 60 at
present, organizers said. Police estimates put the figure
at 38,000.
Bank of Israel supports pension
funds capital market investments (May 19, 2003)
The Bank of
Israel is backing the Ministry of Finance’s position in
favor of channeling the pension funds’ investments to the
capital market and the private sector. The Bank of Israel
Monetary Department today said that channeling
institutional investors to the Tel Aviv Stock Exchange
(TASE) could both contribute to the TASE and diversify the
investors’ asset portfolio.
Iraqi Pension Agency Makes First
Payments (May 19, 2003)
The Iraqi agency
responsible for paying pensioners handed out emergency
cash for the first time Sunday, triggering hours of chaos
as retirees and their families fought with U.S. troops to
force their way into the Baghdad office building. More
than 5,000 retirees and their relatives showed up early
Sunday to collect an initial $40 emergency payment -- two
crisp $20 bills -- designed to help them until Iraqi
workers can reconstruct thousands of records looted after
U.S. troops entered Baghdad.
Russia: Making
Ends Meet Not an Easy Task for Elderly
(May 19, 2003)
These are not the best of times for
Russian pensioners, especially those who have been
retired for some time. Older pensioners can't help
comparing their current plight with the Soviet era, when
a full pension of 132 rubles paid the bills with enough
left over to help supplement their grandchildren's
student stipends. People over 70, whose pension is their
only source of income, struggle just to survive. They
eat simply and try to cut costs on everything from
electricity to shoes.
UK: £200m
lost in pension fraud as families fail to report
deaths (May 18, 2003)
More than 100,000 people are claiming pensions
for relations who have died, an investigation into
pension fraud shows. The audit found that one in 100
spouses, close relations or friends regularly fail to
tell pension schemes and continue to receive money. The
findings suggest that the scale of fraud far exceeds
government estimates and could cost taxpayers more than
£200 million a year in false claims.
Expert comments on China's
social security system: four problems and six
suggestions (May 17, 2003) (in Chinese)
In Liao Wang
magazine this week, an article talked about the interview
with Tiankui, Jing, Director of Sociology Department of
Chinese Academy of Social Science, regarding reform of
China’s social security system. Jing points out four
problems of current system: limited funding, narrow
coverage, lack of basic policy analysis, and poorly
coordinated administrative system. He also provides six
suggestions in reforming the system. He emphasizes that
China needs a well-coordinated social security system to
consider different needs of urban and rural areas. (The
text is in Chinese. To read the Chinese article, pleas
install the Internet Explorer Chinese language pack or NJ
star communicator.)
Lithuanian experience of
accumulating pension funds (May 17, 2003)
In the
Baltic countries, especially in Lithuania lately, the
population’s interest is increasing towards non-state
pension system --
especially because the top financial and private
banking institutions, financing private pension funds,
demonstrate remarkable stability and well balanced
indicators. The recent data affirms that within the last
9 months, the contributions in the Lithuanian private
pension funds have increased by 2.2 times as compared to
the last year. Accordingly,
the number of participants in private pension plans has
grown substantially.
South
Africa: Man held for R20m government pension scam (May
17, 2003)
A South African administrator from
the Government Employees' Pension Fund (GEPF) has been
arrested for an alleged pension fraud scam believed to
involve more than R20-million. The 31-year-old man was
arrested when he arrived for work at the pension
scheme's Pretoria offices in Arcadia early on Friday.
His arrest is the result of six months of quiet
investigations initiated by National Treasury's GEPF.
Israel: Histadrut agrees to let
treasury manage union pension funds (May
16, 2003)
A
turnaround took shape last night in the Histadrut labor
federation stance opposing the appointment of trustee
managers for the veteran pension funds. Histadrut
Chairman Amir Peretz said yesterday that he would agree
"to transfer management of the funds to the state, on
the condition that an agreement ensures the rights of
the fund members."
UK: Women 'facing
pension misery' (May 16, 2003)
Almost a
quarter of all single female pensioners live in poverty,
a study has found. The report, by charity Age Concern
and equal rights organisation the Fawcett Society, found
that, on average, women receive far lower pensions than
men. It concluded that the pay gap which already exists
between men and women during their working lives becomes
a vast pension gulf in later life.
UK: Taxman admits
millions were kept in the dark over pension shortfall
(May 16, 2003)
The Inland Revenue (IR) admitted yesterday that
it had deliberately refrained from alerting nearly 13
million workers to a shortfall in their pension
payments. It dismissed earlier reports that a computer
glitch had led to the failure to tell relevant taxpayers
they needed to top up national insurance contributions
or face reduced pensions. It said the annual deficiency
notification system had been suspended in 1998 because
IR staff were needed to focus on current pension and
benefit claims.
Canada Pension Plan posts annual
loss of $1.1B (May 15, 2003)
The Canada
Pension Plan lost $1.1 billion in its latest fiscal year,
representing a return of negative 1.5 per cent, the CPP
Investment Board reported today while making plans to
invest more aggressively in the future. The $1.1 billion
decline was caused primarily from the prolonged slump in
stock prices and compared with a gain in the previous year
of $2.3 billion, or 5.7 per cent.
Elderly warned of
benefit loophole (May 15, 2003)
Pensioners whose homes are owned by
housing associations have been warned that they could
see their benefits cut because of a legal loophole. The
claim was made by the professional organisation
Chartered Institute of Housing in Scotland. It said that
pensioners who stay in the family home after their
children have moved out may be hit by an anomaly in the
way benefits are assessed.
France's pension reforms (May
15, 2003)
The French unions
say no to pension reforms. But might the government
outmanoeuvre them? The article analyzes the situation of
pension reforms in France and predicts that the odds must favour
French Prime Minister Jean-Pierre Raffarin.
Millions
facing £1500 pension cash demand (May 15, 2003)
Millions of workers in the U.K. were
not told they would have to make top-up payments to
receive the minimum state pension, it was revealed
today. The
blunder means millions of workers, most of them on low
incomes, will have to make significant extra
contributions to qualify for the minimum state pension
of £77.45 a week.
China needs a basic social
security system with a wider coverage, expert says
(May 14, 2003)
Jingtian, Kui,
Director of Sociology Department of Chinese Academy of
Social Science, says recently that China needs to
establish a basic social security system with a wide
coverage. The new system needs to provide basic social
security services and cover both urban and rural areas. He
points out that the government should focus more on
preventative medical services rather than curative
medication to avoid waste of financial resources. (The
text is in Chinese.)
China: paying pension on
time is important (May 14, 2003)
Summary: An
article in the most recent issue of Liao Wang Magazine,
the political magazine under Xin Hua News Agency, points
out that paying pensions in full and on time is the most
important part of the social security programs. It also
claims that the government should ensure to provide basic
needs for the unemployed. (The text is in Chinese.)
Tokyo will ease pension rules to
help stocks (May 14, 2003)
The
Japanese government said Wednesday that it would ease
rules on the transfer of shares managed by private
pension funds to the government in an effort to halt the
continuing decline in share prices.
Government coalition agrees
to launch pension reform by 2005 (May 14, 2003)
The Czech
government coalition parties agreed on Sunday to launch
pension reform within the next two years. The new
pension system, which is to be based on the Scandinavian
model, should motivate citizens to work as long as
possible. The reform will see the system transformed
from a pay-as-you-go financed system to a savings-based
one.
France: Pension strike shuts down
Paris (May 14, 2003)
Public transport
remained disrupted in Paris early today, one day after
hundreds of thousands of French workers joined a massive
public sector strike to protest the centre-right
government's pension reform plans. Tuesday's protest
paralysed much of the country in the biggest show of union
muscle since 1995.
Bosses' pensions 'run into
billions' (May 13, 2003)
Research compiled by the BBC and Hay Group showed
that the total pension pot for all FTSE 100 executive
directors could be worth as much as £2 billion. Details
of executive pensions have angered unions as companies
have run up huge pension fund deficits and changed
employee schemes. The combined pension fund deficit for
FTSE 100 companies is estimated to be £60 billion,
prompting several to switch staff from final-salary
schemes to less secure ones.
No simple answers for R75bn loss
in value of pension funds (May 13, 2003)
South
Africa’s retirement fund investors have seen about R75
billion, 12 percent of the roughly R600 billion
controlled by the investment industry, in value eroded
since the beginning of last year. This excluded the
value erosion of an estimated R150 billion government’s
pension fund, managed by the Public Investment
Commission (PIC). There was no simple answer to who
should shoulder the blame for value eroded to date -
trustees, consultants, multimanagers, fund managers and
investors themselves were all responsible.
Europe hit by strikes over
pension cuts (May 13, 2003)
Tens of thousands of Austrians are to converge on
Vienna from all over the country today to protest at the
centre-right government's plans to slash pensions and
raise the retirement age. The Vienna rallies coincide with
a "Black Tuesday" of industrial action in France, also
triggered by pension reforms, indicating a rising tide of
popular anger in Europe over welfare, budget and pension
cuts.
EU
finance ministers adopt pension directive (May 13,
2003)
The Ecofin Council (EU
ministers of economy and finance) adopted on May 13, a
long-discussed directive for the protection of
pensioners. The directive focuses on creating an
internal market for occupational pensions requiring that
funds hold sufficient assets to cover their commitments.
Pension problem ‘not
that drastic’, says Pulse (May 12, 2003)
According to social democrat student
organisation Pulse, the Malta’s pensions scheme was not
as unsustainable as it is made to seem and with a few
improvements to the present system, the government could
easily guarantee a pension for the elderly population of
the future.
Royal Mail discovers £4bn pension
fund hole (May 12, 2003)
A £4bn pension hole has been uncovered at
Royal Mail which will alarm staff and government while
forcing the cash-strapped management to consider pumping
huge amounts into its retirement scheme. The problem will be
revealed as early as next week on publication of its
annual accounts and takes the gloss off a significant
improvement in the state-owned company's overall
financial position.
Brazil's Pension Reform: A
Golden Goose If It Will Fly (May 12, 2003)
If Brazil’s controversial social
security reform proposal gets off the ground, the reform
may bring more-than-hoped-for gains for the economy of
Latin America's largest country. Aside from shrinking a
chronic public sector deficit, analysts say the reform
could help bring valuable funds into local markets by
boosting investment in the local pension fund industry
by 7-10% annually over the coming years.
Austrian Teachers To Join
Strike Tuesday Against Pension Plan (May 12, 2003)
Schoolteachers planned a one-day strike for Tuesday to
protest against proposed reforms to state pension
benefits and the school curriculum. The action is part
of a wider labor protest against the pension
reforms that began a week ago when the largest strike in
decades brought much of the country's transport to a
halt.
Pension rise set at 5
percent (May 12, 2003)
The Slovak
cabinet has approved a 5 percent increase in pension
payments to take effect from July. The average old-age
pensions will rise by Sk300 (€7.35) to Sk6,400 (€157) a
month. The highest pension available will rise from
Sk8,700 (€213) to Sk9,100 (€224) a month.
Pension
shortfalls threaten to explode (May 12, 2003)
Canada's
largest corporations face mounting demands on cash and
higher expenses because of dramatically deepening losses
last year in their employee pension plans. A Report on
Business study of the 104 companies on the S&P/TSX
index with defined-benefit pension plans found that these
companies saw a pension funding shortfall of more than
$18.7 billion in 2002.
Pension fund lobby wants
investors to veto 'fat cat' deals (May 12, 2003)
Three British companies are set to face
shareholder unrest next week after the National
Association of Pension Funds highlighted concerns over
boardroom pay to their investors. The organisation,
which has been criticising companies which it feels fall
short of best practice, has urged shareholders to either
abstain or reject resolutions put forward by software
group LogicaCMG, CLS Holdings, the property company, and
market researchers Taylor Nelson Sofres.
War widows: Tax their pension?
(May 11, 2003)
The
Indian Ministry of Finance rejected the proposal of
making the pension of Army widows tax free, which would
have provided much needed respite to thousands of army
widows trying to make ends meet. The proposal was
primarily to provide war widows and those whose husbands
died in counter-insurgency operations and in border
areas.
Pension Shock (May
11, 2003)
South African pension funds lost 9% of their
value in the first three months of this year. And their
performance over one year has been even worse, a loss of
12%. Add inflation of around 9% to that, and the loss
comes to a colossal 21%. People retiring soon and those
who face retrenchment will be hardest hit since fund
managers are unlikely to recoup the losses in the short
term.
'Pension Funds Should
Offer Housing Loans' (May 9, 2003)
A call has been
made for Tanzanian pension funds to provide soft housing
loans to their members.
An experienced estate developer, Mohamed Khalfan,
says being state organisations, social security funds
like the Parastatal Pensions Fund (PPF) and the National
Social Security Fund (NSSF) should help their members to
acquire private houses.
Brazil Governors Urge Lula
to Stick to Pension Tax, Estado Says (May 9, 2003)
Brazil's state governors are pressing President Luiz
Inacio Lula da Silva to stick to his plan to tax retired
civil servants, after his party said it would negotiate
the proposal to get the pension bill passed in congress,
the daily newspaper O Estado de S. Paulo reported. The
plan calls for all retired civil servants -- at a
federal and state level -- who still receive a salary
must pay an 11 percent tax on monthly pensions.
Early super splurge
puts pressure on pension (May 9, 2003)
In
Australia, people are retiring early, spending their
superannuation reserves quickly and then relying on the
age pension. In a submission to the multi-party
committee yesterday, the Financial Planning Association
called on the Howard Government to introduce a new
regime so people could not access their superannuation -
as a lump sum - before they were eligible for the age
pension.
Retiring ways for pension
plans (May 9, 2003)
India - Private pension plans, wherever they exist
in our country, are erratic and not uniform. There is no
comprehensive plan to pay pension to the aged in both the
organised and unorganised sectors. To get an idea of the
magnitude of the problem, the Dave Committee, which was
set up under the aegis of the ministry of social welfare
and empowerment and submitted the old age social and
income security report. The Committee findings are
outlined in this article.
Auditor criticizes UH
retirement incentives (May 9, 2003)
The University of Hawai'i should either eliminate or fix
the school's 20-year-old early retirement incentive
program, state Auditor Marion Higa said in a report
released yesterday. As the result of inefficient
program, some employees get dual retirement incentives
overlapping from the state's early retirement incentive
program and the cost savings goal was subverted by
replacing the early retirees with more highly paid
replacements.
Three tiers to
pensions (May 8, 2003)
Mario C. Grech,
chairman of the Middlesea Group, talks about the urgent
need for progress in the long-discussed pensions reform.
He believes that sustainability and adequacy are
fundamental issues to pension problems in Malta and the
key to solving the problems lies in generation of real
economic growth. He calls for all interested parties to
get round a table and recognise the problem.
Italian
unions to challenge Berlusconi over pensions (May 8,
2003)
The
centre-right government of Silvio Berlusconi, Italy's
prime minister, yesterday faced a serious challenge to
its economic reform programme as trade unions prepared
to mobilise forces against planned changes to the
pension system. Leaders of Italy's three main union
movements will meet next Wednesday to decide what form
resistance will take.
France wrestles with pension
reform (May 8, 2003)
The French Government and
unions are squaring up for a summer battle over
pensions. Prime Minister Jean-Pierre Raffarin, who has
formally presented his controversial plans to the
cabinet, says France must introduce the changes to head
off a crisis in years to come. But unions have threatened
to fight the plans tooth and nail, with a campaign of
strikes and mass street protests.
World
Bank urges tough pension reform in Europe (May 8,
2003)
According to a World Bank report, European countries urgently need to
overhaul their pension systems or their rapidly aging
populations will face a sharp fall in living standards
after retirement. The bank said that lack of consensus
in Europe about how reform should be done, including
among Europe Union accession countries, has led to far
slower progress than is needed to tackle the problem.
French Prime Minister Faces
Tough End-Game Over Pensions (May 7, 2003)
Prime Minister
Jean-Pierre Raffarin appealed to a hard-pressed electorate
Wednesday to back his far-reaching bid to rescue France's
old-age pension system from poverty and underfunding. The
draft legislation would raise the number of working years
public employees need to receive a pension to 40 from 37.5
by 2008, bringing it into line with the private sector. To
reflect higher life expectancies, workers will have to
work 41 years by 2012 before retiring and 42 years by
2020.
Pension reform triggers
Austria's first strike in 50 years (May 06, 2003)
Austria is braced for
its first general strike in more than 50 years, a
protest against pension reforms sought by the ruling
conservative-far-right coalition that would raise the
retirement age and decrease pay-outs. The powerful
National Federation of Austrian Unions (OeGB), which is
close to the opposition Social Democrats, has said it
hopes 1 million of its 1.4 million members -- a quarter
of the country's total workforce -- will heed the strike
call.
Companies UK: Boots pension
fund still avoiding equities (May 06, 2003)
The Boots pension fund has ruled out mounting
speculation that it plans to re-start buying equities
after its landmark decision to switch its investments into
bonds. John Watson, chairman of the trustees of the Boots
pension scheme, said a move back into equities was "not
currently on the agenda".
Pension Benefits to Be
Slashed in 2004;Public Outcry Seen (May 06, 2003)
Korea - National pension benefits are likely to
be reduced from next year, while premiums are expected
to increase, according to an official of the Ministry of
Finance and Economy (MOFE). He said the likelihood of
the income replacement rate for National Pension Fund
recipients decreasing from the current 60 percent to 50
percent from next year was increasing.
Pension funds may get to invest abroad (May 5, 2003)
The Indian finance
ministry has decided to allow pension funds to invest
abroad and create overseas financial assets. According
to finance ministry sources, pension assets could
include investment in the overseas market to help the
funds diversify their portfolio. They said this would
also help them to reduce volatility in returns.
Aussies avoiding retirement
savings (May 5, 2003)
People want to
travel and be adventurous once they stop work but few have
thought much about planning financially for retirement,
according to a survey. The survey, commissioned by the
Commonwealth Bank of Australia, found just less than half
of working "pre-retirees" expected to be fully retired by
age 65. It also found a large proportion of pre-retirees
had given little or no thought to planning financially
towards their retirements.
Senior electricity workers
choose to quit now while the pensions are even better
(May 05, 2003)
Ten senior and veteran employees of the Israel
Electric Corporation have decided in recent weeks to
terminate their employment after learning that the
Finance Ministry is planning to worsen the terms of
their pensions.
Pension plan a Pandora's box
(May 4, 2003)
The Japanese public pension program, which is supposed
to support citizens in their old age, has been hard hit by
a rapidly graying population and a declining birthrate.
These twin phenomena make it extremely difficult to
maintain the current pension system. All schools of
thought on how to handle the issue within the government
are missing the essential point of the proposed reform.
The real issue is how to secure revenues to finance
ever-ballooning social security costs.
The coverage of Chinese
pension system for cities and towns expanded (May 3,
2003)
In 2002, the coverage of Chinese pension system for
cities and towns expanded. By the end of last year,
111,280,000 employees and 36,080,000 retirees are covered
by the pension system, an increase of 2,050,000 over 2001.
The annual pension was RMB 8,849 (equivalent to US$ 1,079)
per person in the last year, increasing by 13.7% over
2001. Most retirees received their pensions on time and in
full amount.
Varsities
Groan Under Burden of Unpaid Pensions (May 03, 2003)
This is not the best of times for the authorities of the
country's first generation universities of Ibadan,
Benin, Obafemi Awolowo University, the University of
Nigeria, Nsukka and the Ahmadu Bello University, Zaria.
Apart from the difficulty they are facing in paying
their serving staff, which is reportedly due to the
inadequate recurrent grant from the federal government,
Vice-Chancellors of these universities are also losing
sleep over the non-payment of pension to retirees for
about 17 months, many of whom have started giving up the
ghost due to want of money to care for their medical
needs.
Universal
Pensions in Mauritius: Lessons for the Rest of Us
(April 2003)
“That the
Government of Mauritius provides nearly every resident
over the age of 60 with a non-contributory, basic pension
is one of the best-kept secrets in the world. The scheme
dates from 1950 and became universal in 1958, following
abolition of a means test. Remarkably, introduction of a
compulsory, contributory scheme for workers in the private
sector appears to have strengthened the non-contributory
regime without affecting its universality. This paper
examines the past and future of non-contributory,
universal pensions in Mauritius, and draws lessons that
might be useful for other countries, especially those in
the developing world.”
Ontario to ban mandatory
retirement age (April 30, 2003)
The Ontario government announced plans to ban
mandatory retirement at 65, along with upgrades to the
education and health-care systems and an attack on
impaired driving. Unfortunately,
Ontario does not ban age discrimination so older
job-seekers may have a hard time getting hired due to this
pernicious prejudice.
Pensions: the basic
solution (April 30, 2003)
As the problem of Britain's pensions rumbles on,
ever more desperate (and unjust) solutions to the crisis
are proposed. Perhaps the best and fairest answer is the
simplest of all: an increase in the basic state pension.
Some of the solutions have generated howls of protest
among advocates for older people, and rightly so.
Dalli promises priority on pension changes
(April 30, 2003)
In the island country of Malta, John Dalli said he
intended to take stock of the pension situation and map
out a way forward by the end of May. The Finance and
Economic Services Minister said it was time to take
decisions to defuse the pensions time bomb, which had
lain shelved for several months. But what
caused the problem in the first place? Poor
investment strategies?
Pensioners bare teeth as 40
colleagues die without pension (April 30, 2003)
The Kumasi district branch of the Ghana Government
Pensioners Association has appealed to the president to
prevail upon the controller and accountant general to pay
members their full pension, as directed by the Ministry of
Finance. They would also want all arrears paid them in
line with the directives of the finance minister last
October.
Pensions
warning by World Bank (April 29, 2003)
Using its usual scare tactics, World Bank official Richard Hinz
warned yesterday that pension entitlements may have to
be cut in half or people will have to work up to 10
years longer to achieve their financial retirement
goals. The
World Bank continues to pursue its privatization policy
whenever and wherever it gets the opportunity.
Pension complaints 'mushroom'
(April 29, 2003)
Complaints to a leading pensions advisory service
have soared in the past year, reflecting growing concern
about the health of UK pensions. Written complaints
increased by 53%, and general inquiries to the helpline
rose by 17%, the Occupational Pensions Advisory Service
(Opas) said.
State-paid pensions short
on funds, faith (April 29, 2003)
Mariko Horiuchi, a 30-year-old part-time
English-language teacher living in Tokyo, wonders if she
should trust what the government promises for her future:
a sound retirement covered by state pension benefits. The
article tries to pit younger vs. older persons.
Dmitriyev Fights Uphill
Pension Battle (April 29,2003)
The slimmer the chances have become that pension
reforms will be enacted this year, the more First Deputy
Economic Development and Trade Minister Mikhail
Dmitriyev has prodded the government to accelerate them
-- despite a warning last month from Prime Minister
Mikhail Kasyanov that he should refrain from speaking
out against the government line.
Willetts attacks pension
spending forecast (April 29, 2003)
The scuffle over predicted pension
levels continues in the UK. Here is what the Conservatives are
saying: Official
projections that the UK will continue to spend only
about 5 per cent of its gross domestic product on state
pensions over the next 50 years are "simply incredible”,
the Conservatives' pension spokesman warned. In many
other European countries, public spending on pensions is
projected to run at 10 to 15 per cent of GDP. But the UK
figure is no longer credible, he said.
OECD
calls for Belgian pensions reform (April 28, 2003)
A new OECD report has suggested Belgium
contemplate a major reform of its pension system. The
Organisation for Economic Cooperation and Development's
141-page report noted that Belgium’s three statutory
pension schemes (public sector, private sector,
self-employed), calculate retirement pensions
differently.
Market
Watchdog on Patrol as Pension Fund Flood Nears (April
28, 2003)
The nation's stock market watchdog is racing
against time to improve the corporate behavior of
publicly traded companies before a flood of federal
Pension Fund money hits the markets. "The market has to
achieve maximum transparency [as soon as possible],"
Federal Securities Commission head Igor Kostikov told a
conference co-organized by the FSC, the New York Stock
Exchange and MICEX, Russia's biggest bourse. What is the
process to assure that companies have achieved
transparency?
Kevin Brown: Pensions
credibility gap (April 25, 2003)
UK - Andrew Smith, the work and pensions
secretary, was widely criticized when he produced his long
awaited pensions green paper in December for suggesting
that there were no serious problems in the pensions
system. Assuming that tax increases to provide a
comprehensive state pension are ruled out, ministers will
eventually have to decide between making pensions
contributions compulsory and letting the market “solve”
the problem.
Retirements : The trade
unions are trying to unite their critics (April 23,
2003)
On
24th April, the Minister on Social Affairs
of France, Mr. Francois Fillon will address the
citizens with the request to support the government
proposal on pensions. The day before, trade unions
have met to take a joint action against the proposal to overhaul the
pension systems.
The broad outline of the reform - the progressive
harmonization of the public and private, the increase
in the duration of contribution for all - was highly
criticized by all of the trade-union organizations.
(full text in French)
Third of young adults 'have yet
to start pensions' (April 23, 2003)
UK - The Lloyds TSB study contains a
poll among 18 to 34-year-olds which found widespread
recognition of the need for a pension but less evidence
they were taking practical steps. Sixty-per-cent of those
questioned gave "lack of cash" as the main reason for not
saving for their retirement, the same number who said they
were worried about not having enough money when they are
old.
Pension reform to include
part-timers (April 22, 2003)
Japan - The Health, Labor and Welfare Ministry on
Tuesday presented a proposal that would require part-time
employees who work more than 20 hours a week or earn more
than 650,000 yen a year to enroll in a corporate employee
pension plan in order to expand the number of subscribers
to such plans.
The tinkering that ruined
pensions (April 22, 2003)
Twenty years ago the UK
enjoyed a big competitive advantage through its company
pension schemes. They were low-cost, fully funded and
responsibly run. Now we hear talk of a pensions crisis,
as if the UK faced the same problems as France or
Germany with their state pay-as-you-go schemes. What has
changed?
Government harmonizes law on
private pension plans with EU legislation (April 21,
2003)
The Czech government has amended the law on
private pension schemes to bring it into line with EU
norms, says government spokeswoman Anna Starkova. The
newly amended law will enable Czech pension funds to
invest in shares traded on regulated markets of OECD
countries.
Pension fund of Russia
will continue construction of houses (April 21, 2003)
Mr. Michael
Zurabov, the chairman of Russia’s Pension Fund stated
that construction of blocks of apartments for
handicapped and retired elderly has been completed in
the Southern regions of Russia. This facilitated
resettlement of population groups who lost their housing
during massive floods last year. Mr. Zurabov underlined
that care for elderly is provided through three
programs: raising pensions, financing of medical care
for retired people and reduction of service charges.
(full text in Russian)
Elderly may be given choice
between pension, tax exemption (April 17, 2003)
Finance
Minister Masajuro Shiokawa said Wednesday the
government should consider adopting a system that
would give high-income elderly people the choice of
receiving basic public pension benefits or an
exemption of the same amount for inheritance tax.
Administration, governors
reach accord on pensions (April 16, 2003)
The administration of Brazilian
President Luiz Inácio Lula da Silva and all 27 state
governors reached agreement Wednesday on the shape of a
broad pension reform bill, Welfare Minister Ricardo
Berzoini said. He said the reform was designed to make
the nation´s retirement system self-sustaining.
Brits Have Poor Pensions (April 14, 2003)
The vast majority of people in the UK
are not saving enough to pay for the sort of lifestyle
they expect in retirement, it is being claimed. A
newly-published Institute of Directors report blames
both the Government and individuals for the number of
"under pensioned" people in the country.
Kasyanov Gets Soviet in Pension Fund Spat (April 8,
2003)
Criticism
of the government's pension reform program is driving
Mikhail Kasyanov “Soviet.” The prime minister, in an
act political observers say hasn't been committed
since the country went capitalist, sent an "official
warning" to First Deputy Economic Development and
Trade Minister Mikhail Dmitriyev on Friday for
"multiple public disagreements with the government's
position on pension reform." Who speaks for the older people?
Deputy Minister got
the warning for free interpretation of the pension
reform (April 7, 2003) (in Russian)
The Prime Minister of the Russian Federation warned the
First Deputy Minister of Economic Development Mikhail
Dmitriev regarding his incomplete service conformity,
caused by misinterpreting the government’s position on
pension reform during his public appearances. In speeches Mr.
Dmitriev accused the government of possible reform
failure, and criticized the participation of pension funds
in the reform.
Putin:
pensions to be increased by 6%-7%(April 4,2003)
Speaking
on the issue of pensions,
Putin said that it is possible that pensions will
be raised once again in addition to the index-linked
increase planned for August. He said that from August 1
pensions are planned to be increased by 6%-7%, which,
coupled with the April 1 index-linked rise, will result
in an average monthly increase of 265 rubles this year.
Staff in
social work colleges go on strike (April 4, 2003)
Teaching and
non-teaching staff from 55 social work colleges across
the Pune State, India, have launched an indefinite
hunger strike in front of the Social Welfare Directorate
here to press for pension and gratuity cover.
French PM vows more tax cuts,
pension reform (April 3, 2003)
The French
government says it is going to cut taxes further and
proceed with the reform of the state-run pension system,
as the system is facing a funding crisis. Despite the
nationwide strike over the reform, the government plans
to pass it by summer. Stay tuned.
Planes Grounded as
French Workers Strike (April 3, 2003)
Air
traffic controllers, postal workers and other public
employees brought much of France to a halt with a
one-day strike over government plans to overhaul the
pension system. The
people speak!
Consumer groups in call
for pensions safety net (April 3, 2003)
Consumer
groups are to urge ministers to set up a safety net.
Mick McAteer, senior policy adviser at the Consumers'
Association, said: "The point of a safety net is to
protect consumers against events which could wipe out
pension savings overnight."
French Transport Crippled
by Strike Over Pensions (April 3, 2003)
The transport strikes come
as the conservative government prepares to unveil
plans on April 11 to overhaul France's pay-as-you-go
pension system, creaking under the weight of an
aging population.
Pensions funds to build power
stations for leasing to IEC (April 3, 2003)
Sources inform “Globes”
that a revolutionary plan is emerging, under which
pension funds would invest several billion dollars in
the coming years to build power stations for Israel
Electric Corporation (IEC).
Air Canada pensions
under-funded (April 02, 2003)
Air
Canada revealed yesterday as it filed for protection
from its creditors that its pension plans are under
funded by about $1.3 billion, forcing the insolvent
airline to discuss potential solutions to the
shortfall with federal regulators.
Social
Security Programs Throughout the World: Asia and the
Pacific, 2002 (March
2003)
This report, which is
part of a four-volume series, presents cross-national
comparisons of social security systems in 50 countries in
Asia and the Pacific. It summarizes the five main social
insurance programs in those countries: old-age,
disability, and survivors; sickness and maternity; work
injury; unemployment; and family allowances. The other
volumes in the series focus on the social security systems
of countries in Europe (released in September 2002),
Africa (due September 2003), and the Americas (due March
2004). Together, the reports provide important information
for researchers and policymakers who are reviewing
different ways of approaching social security challenges
and adapting the systems to the evolving needs of
individuals, households, and families. These efforts are
particularly important as each nation faces major
demographic changes, especially the aging of the
population, as well as economic and fiscal issues.
Nearly 75% of final
salary schemes shut to new entrants (March 24, 2003)
In Great Britain, almost three-quarters of final salary
schemes are now closed to new entrants, or even to
future contributions from existing employees, says the
Association of Consulting Actuaries.
Pension funds: The
next boom business (March 23, 2003)
The Indian pension
fund market is set for some big changes in the coming
months with the government planning a full-fledged
regulator for the industry. Analysts say that the
pension market can make a significant contribution to
the development of Indian capital markets.
Honda move to raise
age of retirement may set trend (March 22, 2003)
To
preserve the existing pension scheme, Honda tries to
increase the retirement age for its workers from 60 to
62 years. Honda's pension situation also requires
closing the scheme to new employees and increasing staff
and company contributions.
Reform has failed.
The World Bank criticizes the new pension reform
(March 20, 2003) (in Russian)
World Bank economists say that the pension reform
in Russia contains some serious miscalculations, and thus
it goes ‘the wrong way’. But Russian experts argue that
the reform cannot be stopped, as it can cause large-scale
financial crisis.
BAE pension strike
threat 'easing' (March 17, 2003)
The
Transport and General Workers Union at the center of a
pensions dispute with BAE systems claims it is winning
concessions from Britain's biggest arms maker
Canberra presses
pension funds on fees (March 17, 2003)
How
much does the pension fund manager earn? Probably, too
much in Australia: the Australian federal government
is urging greater competition among pension fund managers
amid public concern that fees are too high while returns
are too low.
Insurers call for
simpler state pension scheme (March 17, 2003)
The Association of British Insurers (ABI) have called on
the Government to simplify and strengthen the state
pensions system to help give future pensioners an
unambiguous incentive to save.
Pension Sector:
Reforms Not In Sight (March 17, 2003)
There were high
expectations on social securities from Finance Minister
of India Jaswant Singh’s maiden Budget (2003-04). But
instead of announcing any detailed social security
measures which would have kickstarted the pension sector
reforms, Mr Singh preferred to make a few announcements,
including the 9% special pension scheme.
Treasury to let
pension funds loose on capital markets (March 17, 2003)
As part of the structural reforms that are to be presented
tomorrow, the Finance Ministry of Israel will no longer
guarantee yields on the pension funds, with the eventual
aim of ending the issue of special government bonds for
the funds. Consequently, poor performing funds will have
to lower their payments to their insured members.
EU backs rules
to free up cross-border pensions (March 12, 2003)
The European
Parliament backed plans to allow the multi-trillion euro
pension fund industry to operate across borders, a move
aimed at boosting stock market capitalisation in the
15-nation EU. Experts expect the value of occupational
retirement schemes in the EU to rise to above 7,000
billion euros in 2010 from 2,000 billion euros
currently.
No-pension companies 'breaking
law' (March 12, 2003)
Research claims at least 25,000 companies in Great Britain
are breaking the law by not providing staff with a pension
scheme.
China: Reform of Social
Security System (March 11, 2003) (in Chinese)
Qingtai, Chen,
Vice Director of Development Research Center of the
State Council of P.R.China, points out that the Chinese
government needs to establish new public policies for
social welfare reform as soon as possible. He believes
that the new system should aim to achieve a wider coverage
with relatively lower benefits to recipients. He thinks that
the system should be financially sustainable and
politically acceptable to all interest groups. He also points
out that the current system is essentially a pay-as-you-go
system characterized by narrow coverage, early retirement,
high replacement ratio, and high tax rate. (The text is in
Chinese. To read the Chinese article, pleas install the
Internet Explorer Chinese language pack or NJ star
communicator.)
Latin America: Report of the Regional
Meeting of Experts: Gender Impact and Pension Reform in
Latin America (March 10-11, 2003)
Latin American countries gathered to discuss pension
reform in order to reach gender equality. The labor
market, in which women are hardly integrated, causes
poverty among older women. Countries decided to sustain
women during their working life to fight the effects of
discrimination upon retirement. Social protection appears
as the main solution: introducing a minimum pension or
employment subsidies. Countries also agreed to implement
an anti-discriminatory legal framework, to recognize
legally unpaid housework, and to increase retirement age
to that of men. This meeting was a reminder that pension
systems must change along with demographic transitions, in
this case the long life expectancy of women.
Old Age Pensions In Sweden
Sweden introduced a public pension scheme in 1914. In June
1998, a new system based on full life-time earnings has been adopted.
Between these two dates, this file will show you the
Swedish pension system’s evolution.
Interview with the
ATON Management Vice-president Vadim Soskov (March 7,
2003) (in Russian)
In his
interview with “Gazeta” the vice-president of ATON Asset
Management, Vadim Soskov, shares his vision of
challenges that pension reform in Russia can face, and
of its possible consequences for citizens, government,
and financial markets.
Interview with the
Deputy Minister of Finance of the Russian Federation
Bella Zlatkis (March 6, 2003) (in Russian)
On Ms. Zlatkis’ opinion,
in the next 3-4 years, 80% of the funded part of
pensions will be invested in private pension funds and
managing companies.
UK pensions '£100bn in the
red' (March 4, 2003)
Investment bank
Dresdner Kleinwort Wasserstein estimates
that the UK's top companies are collectively facing a
pension blackhole of up to £100 billion. ($150
billion). “The group blames the problem on overly
optimistic assumptions about the returns firms will
get on equities, adding that these projected returns
helped mask the short-falls.”
Pension Reform Tests Brazilian
President (March 3, 2003)
The Brazilian President Lula da Silva is facing
hard task of reforming the retirement system, which doles
out full-pay pensions after 35 years of service for many
civil servants, contributed last year to a $20 billion
deficit in the social security system and represents 42
percent of all government payroll costs, according to
government statistics.
Pension funds are
merging (March 3, 2003) (in Russian)
Two Russian top-10 pension funds, ‘Rostelecom-Garantiya’
and ‘Telecom-Souz’, will merge, creating one of the
largest pension fund on the Russian market, capable to
compete with absolute market leaders. The two funds have
jointly about 2 billions rubles of pension reserves (1USD
= approximately 32 rubles)
Long-term care needed for
many pensions (March 1, 2003)
In this Financial Times article, you will
find financial explanations about the UK and the US
current pensions systems shortfalls. For example, in
the US, “excessively optimistic return assumptions
have hidden the scale of the funding problem and
have artificially boosted profits.” Did those same
assumptions feather the rests of firm
executives?
Interview
with Mrs. Faith Innerarity, Minister for Social Security
in Jamaica (February, 2003)
Mrs. Faith Innerarity, Minister for Social
Security in Jamaica, answers GAA’s questions about social
protection of workers who become part of the globalized
labor market. Mrs.
Innerarity has served as the Chair of the UN Commission
for Social Development and is well known for her
forward-looking social views and policies.
Pension
chaos fears if giros are scrapped (February 28,
2003)
In
Ireland, government plans to scrap giros and pension
books could cause chaos for Ulster's pensioners and
low-income families. Claimants will have to open a
bank or Post Office account. Many of them do not have
experience of the banking system and will probably miss
out on benefits.
La
retraite pratique (February 27, 2003) (in French)
" One cannot be, at 55 years old, at the same time
an old and used employee, and a young active and dynamic
pensioner," the French Prime Minister recently contended.
The time of early retirements is past. Or almost!
Employees have been used leaving prematurely and companies
have been at the same time obsessed by the renovation of
their troops. Some begin to adapt themselves to the new
look: a revolution in French human resources.
Big scandal in the ‘pension
family’ (February 21, 2003) (in Russian)
A scandal is arising around the recent decision of
the Russian Government about the appointment of
Vneshekonombank to be the state managing company for
personal pension accounts for citizens who did not choose
the private fund. The reason is a letter from the Minister
of Economic Development, Mr. Gref, to the Prime Minister,
stating that the decision was wrong and that it violated
existing procedures.
Seniors send “a gift” to the Russian
President (February 20, 2003) (in Russian)
Russian
pensioners protested against the scanty increase in
pensions by sending the additional money they received,
31 rubles, directly to the President. Post office
officials report that from one city, Voronezh, about 50
thousands rubles were sent. Pensioners claim that the
additional money is only worth one liter of milk, half
of a kilogram of sugar, and bread, and they want the
president to feel ashamed.
La Bourse
ou la retraite ? (February 17, 2003) (in
French)
The project to create a pension fund in the French
system seems abandoned by the Raffarin government. Among
the arguments advanced for this retreat is the stock
market crisis, after the big crisis of 1930s and 1970. If
you take the American example, nothing can be more risky
right now. According to Patric Artus, director of the
economic studies of CDC Ixis, there is about 900 billion
dollars in the American pension funds in the stock market.
The Ministry
of Finance will become a pension supervisor (February
14, 2003) (in Russian)
The Institutional
intrigue continues in Russia over control of pension
fund investment. The Ministry of Finance is currently
seen as the most probable candidate to control this
perspective market of mandatory pension insurance
scheduled to appear in Russia this year. It is expected
that the pension market volume by the year 2008 will
have $8 billion of new cash inflows a year.
Speech
of the First Deputy Minister of Labor and Social
Development of Russian Federation G. Karelovoy (
February 12, 2003)
Here are
excerpts from the Statement from the Russian Federation
on Feb. 12, 2003, at the Commission for Social
Development.
Statement
of S.E.M Mohammed Loulichki (February 12, 2003)
In the name of the group of 77 and China in front
of the 2003 Commission of the Social Development, here is
the statement from the Assistant Permanent Representative
of the Kingdom of Morocco.
For Ailing
Japan, Longevity Takes Bite Out of Economy (February
11, 2003)
Here is a complete
article about elderly people’s daily life in Japan. In
a country with the world's longest average lifespan,
older people are worried about outlasting their
savings. Japan's population will start declining in
three years. By around 2007, the proportion of the
population over 65 will have jumped to 20% from 10% in
just 21 years.
China
received over RMB 211 billion of pension fees in 2002
(February 8, 2003)
In 2002, Chinese pension fund received over RMB 211
billion (equivalent to US$ 25.7 billion) for pension fees,
an increase of over RMB 25 billion (equivalent to US$ 3.04
billion) over 2001. By the end of 2002, over 110,000,000
people participate in the pension system, an increase of
2,200,000 people over 2001.
EU
Commission Wants Rules On Pension Contributions Eased
(February 5, 2003)
The E.U. Commission has
warned Denmark, Belgium, Spain, France, Italy and
Portugal to change their pension fund taxes with the
objective to create cross border European pension
plans. This action aims to stop the discrimination
toward people working in different countries in Europe
who now are obliged to take out new pension insurance
when they take up a job in another member state. But
the major benefit would be for multinational
corporations who would no longer need to set up
separate pension systems in different European
countries.
Jean-Pierre Raffarin veut faire
cotiser les fonctionnaires plus longtemps (February
4, 2003)
The
French Prime Minister presented to the Economic and
Social Council, the main lines of the pension future
reform, which he intends to finish before the end of the
parliamentary session. Mr Raffarin clearly evoked the
perspective of a progressive adaptation of the durations
of subscription of the public on the private, by wishing
that " the situation of the persons placed in comparable
situations have to be harmonized "..
French Protest Planned
Changes to Pension System (February 3, 2003)
In France, tens of
thousands of demonstrators gathered in a nationwide
protest day against the government's plans to change the
public pension system. People were urging the government
to keep the retirement age at 60 and not to lower the
size of pension payments. Without a change to the
system, France will see the number of people living in
retirement overtake those working around 2020.
Durée et taux de cotisation, âge de
départ, niveau des pensions : de nombreuses
inégalité (February 3, 2003)
This French article explains the
many differences between the private and the public
pension systems. For example, public
sector employees need only work for 37.5 years
before earning a full pension, compared with 40
years in the private sector.
"37 ans et demi pour tous,
et pas un jour de plus", scandent les manifestants
parisiens (February 3, 2003)
On
Saturday, February 2nd, about 400,000
French people gathered in the streets of Paris to
show their government that they care about their
future pensions. They were singing “75, 60,37.5”: 75
percent is the percent of the pension based on the
last salary received, 60 years for the legal age of
retirement and 37.5 for the number of necessary
contributing years to the system. They do not
support the proposed changes.
Raising
state pension age: are we ready?
This review from
the Pension Policy Institute treats the issues around
the idea of raising the age at which the older
population in the UK can receive a state pension. The
author suggests that it will take many years to raise
the State Pension Age, so that people have time to
adjust their work and savings plans. A practical
solution would be for the change to take place between
2020 and 2030. Then only people currently aged 42 or
less would have to wait to 70 for their state pension.
Politics and ideas in
policymaking: reforming pension systems in comparative
perspective: the case of Uruguay and Chile
In spite of
similarities between Chile and Uruguay's economic and
political situation, they adopted opposed pension
policy reforms. This paper describes briefly the main
points of both reforms. “Uruguayan reforms were
dramatic but the reform was closer to the ILO
recommendations than to a neo-liberal formula
propounded by the regime. Unlike Chile’s ,the Uruguayan
dictatorship's economic policy lacked a clear and defined
economic orientation during the whole period. “
Russian pensioners will get
30-rubles increase (February 1, 2003) (in Russian)
Starting February 1st, pensions
in Russia increase by 6%. The base part of the pension
will grow by approximately 30 rubles to 553.72 rubles.
After the increase, the average pension in Russia will be
about 1500 rubles (1 USD = approximately 32 rubles)
Pensioners are
buried alive (January 24, 2003) (in Russian)
A pensioner from Nizhnevartovsk,
Russia, had to prove that she is alive, after she was
included by mistake into the list of dead, and stopped
receiving her pension. The Pension Fund gave its
apologies, and reimbursed her pension for one and a half
months period, while the women was absent from the
‘living’ lists.
State has coped
with pension money by itself (January 24, 2003) (in
Russian)
The Russian government has
designated Vnesheconom Bank to manage pension funds of
citizens who have not chosen any private pension fund.
It is expected that the vast majority of Russians will
let the bank take care of their pensions rather than
risk other “private” options. Some experts worry that
it can be dangerous because funds can be used to pay
the state’s external debts.
Dall'Ecofin
ok con riserva (January 21, 2003) (in Italian)
The document by the
council of European financial ministers which approved
the 2002-2006 Italian stability program expressed some
concerns on the number of "una tantum" measures that
will be adopted in 2003 in order to meet the target
imposed by the EU to reduce public deficit. The report
argues that Italy will have to fasten the approval of
structural reforms, in particular in the public pension
system, which still presents a massive deficit..
Chart
of the labor privileges (January 21, 2003) (in
Russian)
PricewaterhouseCoopers' research shows that thirty
percent of foreign companies in Russia plan to launch
private pension plans for their employees starting this year. In 2002 only
six percent of the companies used this instrument.
Eighty percent of the companies offer privileges such as
health insurance or mobile phones.
The Free Rider Principle:
How Privilege Is Subsidized (January 15, 2003)
Transnational
corporations go to great lengths to avoid paying taxes,
hording billions of dollars that could be spent on
social services and infrastructure development. This
article reveals the “perverse” ways in which ordinary
citizens in both rich and poor countries subsidize the
world’s corporate elite.
Study
Looks at Squatters and Land Titles in
Peru (January 9, 2003)
In Peru, the largest property title reform project in the
world allows squatters to obtain legal title to the space
they inhabit. A Princeton University study shows that
communities that have undergone title reform have higher
employment and a lower rate of child labor than
communities without title reform.
The Ten Worst
Corporations of 2002 (January 3, 2003)
For a year of notorious corporate crime, the Multinational
Monitor has compiled a list of ten corporations with
the most heinous records.
Driving the GATS
Juggernaut (January 2003)
The WTO General Agreement on Trade and Services (GATS) is
a product of twenty years of intense lobbying by the US
financial services industry, this Red Pepper
article argues. Services corporations extensive influence
over GATS policy has no place in a democratic
policy-making process.
Public Money in the
Pipeline (January/March 2003)
Under the energy plan
devised by Vice President and former oil executive Dick
Cheney, the US government increasingly finances large
oil companies’ most risky and volatile projects. In the
name of “diversifying oil consumption,” the US throws
billions of dollars into companies with disastrous
environmental and human rights records.
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