scholarly journals Market design for the provision of social insurance: the case of disability and survivors insurance in Chile

2009 ◽  
Vol 9 (3) ◽  
pp. 421-444 ◽  
Author(s):  
GONZALO REYES
Keyword(s):  
Social Insurance ◽  
Pension System ◽  
Pension Reform ◽  
Insurance Company ◽  
Market Failures ◽  
Risk Pooling ◽  
Auction Mechanism ◽  
Fund Managers ◽  
Barrier To Entry ◽  
The Government

AbstractAs part of the pension reform recently approved in Chile, the government introduced a centralized auction mechanism to provide the Disability and Survivors (D&S) Insurance that covers recent contributors among the more than eight million participants in the mandatory private pension system. This paper is intended as a case study presenting the main distortions found in the decentralized operation of the system that led to this reform and the challenges faced when designing a competitive auction mechanism to be implemented jointly by the Pension Fund Managers (AFP). When each AFP independently hired this insurance with an insurance company, the process was not competitive: colligated companies ended up providing the service and distortions affected competition in the market through incentives to cream-skim members, efforts to block disability claims, lack of price transparency, and the insurance contract acting as a barrier to entry. Cross-subsidies, inefficient risk pooling, and regulatory arbitrage were also present. The Chilean experience is relevant since other privatized systems with decentralized provision of this insurance may show similar problems as they mature. A centralized auction mechanism solves these market failures, but also gives raise to new challenges, such as how to design a competitive auction that attracts participation and deters collusion. Design features that were incorporated into the regulation to tackle these issues are presented here.

scholarly journals FINANCIAL STABILITY OF THE SOLIDARITY PENSION SYSTEM IN UKRAINE

2019 ◽  
pp. 471-480
Author(s):  
О. Сhebereyako ◽  
◽  
V.. Bykova
Keyword(s):  
Financial Stability ◽  
Social Insurance ◽  
Pension Fund ◽  
Pension System ◽  
The Elderly ◽  
Government Budget ◽  
The Public ◽  
Revenue Collection ◽  
Accumulation System ◽  
The Government

The article is devoted to actual issues of public finance – old-age income support and social security in the twenty-first century. For this reason, government has tried to guarantee old-age’s pension eligibility. In our country pension system is presented with three-level pension system, which join mandatory and voluntary components – solidary system (first level), compulsory accumulation system (not exist now) and private pension system. According to Ukrainian’s pension model, basic and minimum pensions are funded by solidary system or PAYG (“Pay-As-You-Go”) system. As the results, maintains of sufficient financial resources of Pension fund’s budget is very important for financial stability of pension system. The authors show the relationship between sufficient financial support for the elderly in Ukraine and the financial capacity of the solidarity pension system. It was found that in order to form a financially stability pension system, it is necessary to ensure a sufficient amount of own pension fund revenues and avoiding deficit of the Pension Fund’s budget. So, the main indicators of current PAYG system in Ukraine include the public pension expenditures and deficit of the Pension Fund. The article presents dynamics of revenues to the Pension Fund of Ukraine and structure of own pension fund revenues and allocations from the government budged. According to author’s research, the main source of revenue collection of the Pension fund’s budget in Ukraine is the budget’s transfers. О. Чеберяко, В. Бикова ISSN 2078-5860 ФОРМУВАННЯ РИНКОВОЇ ЕКОНОМІКИ В УКРАЇНІ. 2019. Вип. 41 480 The budget expenditures in the structure of income of the pension fund are also analyzed. The total amount of the government budget expenditures that are directed to financing the pension fund are about twenty percent. In our opinion, the key reasons of the “lack of own income” are the shadowing of the economy, the macroeconomic situation, the low minimum wage, the existence of a limit on the maximum amount of wages, which accrues percent of social contribution. As a conclusion, the authors suggest measures for solving the issue of “lack of own income” of the Pension Fund of Ukraine – rising the retirement age, labor market’s reforming, increasing insurance fees and implement compulsory accumulation system. The analytical materials and conclusions can be useful for following researches of finding solutions for achieving the financial stable Pay-You-Go system. Key words: pension system, The Pension fund, social insurance payments, deficit of The Pension fund, government budget.

scholarly journals You Win Some, You Lose Some: Pension Reform in Bachelet’s First and Second Administrations

2019 ◽  
Vol 11 (2) ◽  
pp. 204-230 ◽  
Author(s):  
Silvia Borzutzky
Keyword(s):  
Political Ideology ◽  
Pension System ◽  
Pension Reform ◽  
Presidential Power ◽  
Pension Policy ◽  
The Will ◽  
The Government ◽  
The Impact ◽  
Government Coalition

This article analyses and compares President Bachelet’s successful efforts to reform the Chilean pension system in 2008 and her failure to achieve the same objective in 2017. The article addresses the impact of electoral promises, policy legacies, policy ideology, presidential power, the role of the private sector, and the role that the government coalitions had in the process of pension reform during the Bachelet administrations. We argue that the 2008 reform was possible because of Bachelet’s personal commitment to reform and the presence of a stable governing coalition that had the will and capacity to legislate. In the second administration, although the policy legacies and ideology had remained the same, the reform did not materialise due to intense conflict within the administration and within the government coalition, as well as conflict between the administration and the coalition. These conflicts, in turn, generated a vicious cycle responsible for Bachelet’s declining popularity, limited political capital, and reduced support for reform. A stagnant economy further undermined these efforts. In brief, this article argues that when assessing success and failure in pension policy reform it is important to analyse not only policy legacies and political ideology but also the strength of the executive, the cohesion of the governing coalition, and the country’s economic performance.

Pensions at the Time of Recession. The Case of Lithuania

2011 ◽  
Vol 57 (3) ◽  
pp. 251-266 ◽  
Author(s):  
Teodoras Medaiskis
Keyword(s):  
Private Sector ◽  
Social Insurance ◽  
Pension System ◽  
Social Insurance System ◽  
High Unemployment ◽  
Insurance System ◽  
The Social ◽  
Reserve Fund ◽  
The Government ◽  
Deep Recession

In 2009, Lithuania suffered very deep recession. The fall in GDP by 15 %, high unemployment, and decreased population earnings all affected the pensions system. Before the recession struck, social insurance expenditures had increased considerably and the reserve fund had been exhausted. The recession resulted in the decreased income of the social insurance system and state. While in 2009, the government attempted to maintain the level of pensions, by 2010, it was forced to cut benefits. This shocking decision raised awareness about some theoretical problems concerning the nature of pensions. Is the social insurance payg pension the property of the retiree, or it is only a part of the working generation income shared via the social insurance system with the retired generation? How should the protection against poverty and income replacement components be combined in the pension system and how should they be financed? How should the payg and funded components be united and what are the roles of the private sector and the government? In this article, Lithuania’s attempts to cope with the recession’s consequences and to respond to these newly posed questions are presented.

Pension Reform Options in Hong Kong

2018 ◽  
Vol 29 (2) ◽  
pp. 245-258
Author(s):  
Che Cheong Poon ◽  
Fuk Kin Joe Wong
Keyword(s):  
Hong Kong ◽  
Interest Rates ◽  
Pension System ◽  
Pension Reform ◽  
Average Length ◽  
Pension Plan ◽  
Defined Benefit ◽  
System Research ◽  
Retirement Benefit ◽  
The Government

This article argues for the establishment of a defined benefit and partially funded universal pension system. The characteristics of this system represent a publicly managed mandatory contributory pension plan and the coverage of its benefits for all Hong Kong elderly aged above 65. By applying a mathematical model which links up the periodic savings during people’s working life, level of interest rates, average length of time in retirement, and the amount of retirement benefit payments, we calculated the possible scenarios for Hong Kong to reform its pension system. Research results suggest that the proposed system will be financially viable and sustainable provided both the government and its citizens are willing to pay for it.

scholarly journals Integrating Servqual-Kano-QFD for Social Insurance Service Quality Improvement in Surabaya

2021 ◽  
Vol 14 (1) ◽  
pp. 50
Author(s):  
Dwi Dini Pratiwi
Keyword(s):  
Customer Satisfaction ◽  
Quality Function Deployment ◽  
Social Insurance ◽  
Good Governance ◽  
Strategic Decision ◽  
Insurance Company ◽  
The Public ◽  
The Social ◽  
The Government

For companies engaged in the service-providing sector, good service by meeting customer's desires and needs is a must in order to thrive competitively. This case study was conducted on service provided by the government social insurance company engaged in traffic accident insurance services in Surabaya. As an industry that provides service, customer satisfaction is of importance in order to gain trust from the public, reduce negative opinion in public, and support the objective of good governance. This study integrated the SERVQUAL-Kano method to evaluate customer satisfaction concerning 18 service attributes related to service provided by the social insurance company. Further efforts were then made to find solutions for service attributes with low satisfaction scores by using the Quality Function Deployment (QFD) method. Therefore, the results can help to improve the quality of service. The results were in the form of a priority improvement design for strategic decision recommendations that can be implemented by the company to increase customer satisfaction.

Argentina reforms advance but carry political cost

2017 ◽  
Keyword(s):  
Pension System ◽  
Pension Reform ◽  
Public Spending ◽  
Fiscal Deficit ◽  
Content Type ◽  
Pension Reforms ◽  
Debt Default ◽  
Political Cost ◽  
The Government

Significance Following its strong results in the October mid-term election, the government has been pressing tax and pension reforms and a new fiscal accord with provincial governors; all except the pension reform must now go to the Senate. The measures may ease investor concerns that the government’s inability to reduce the fiscal deficit could end in a new debt default. Impacts The tax reform’s effect on high tax pressure will be moderate at best. Provinces’ ability to reduce distortive taxes will depend on their ability to cut public spending. Changes to the pension system will prove especially conflictive politically.

Policy will strain the German pension system

2018 ◽  
Keyword(s):  
Interest Rates ◽  
Pension System ◽  
Pension Reform ◽  
Government Policies ◽  
Occupational Pension ◽  
Content Type ◽  
Low Interest Rates ◽  
Old Age Poverty ◽  
The Government ◽  
Pension Liabilities

Subject Germany’s pension system. Significance The pension system is under increasing pressure from demographic change, low interest rates and generous government policies. Impacts Increasing tax liabilities on pension incomes could increase the prevalence of old-age poverty. Rising pension liabilities in the occupational pension pillar could dampen business investment in years ahead. The question of pension reform could be the undoing of the government when the coalition parties meet to evaluate their work in late 2019.

scholarly journals Development of service pension policy in Latvia from 1996 until 2016

2018 ◽  
Vol 51 ◽  
pp. 03011
Author(s):  
Inese Upite ◽  
Feliciana Rajevska
Keyword(s):  
Social Insurance ◽  
Pension System ◽  
Pension Scheme ◽  
Policy Planning ◽  
Pension Policy ◽  
State Budget ◽  
Pension Schemes ◽  
Social Pension ◽  
The Social ◽  
The Government

The government made a decision to terminate the development of the service pension in 1997. However, during 1998–2016 the scope of service pension beneficiaries was extended. Thereby along with the overall social insurance pension system, the social pension scheme has been established and developed for a certain range of people funded by the state budget – the system of the service pension. The aim of the article is to explore the development of the service pension policy during 1996–2016. To accomplish it, in the framework of the study concepts related to the service pensions and the tendencies of reformation of the service pension schemes were studied. The international practice and the experience of several countries were explored, as well as the analysis of legal acts, policy planning papers and statistics was performed. The purpose of the service pension has changed and diversified, moreover, the issues regarding the service pension coverage are promoted by a group of politicians, escaping a wider discussion in public and even in the government.

DEMOGRAPHIC, SOCIAL AND ECONOMIC DETERMINANTS OF THE PENSION REFORM PAYMENT PLAN OF THE PENSION SYSTEM BASED ON TRANSFER OF CAPITAL FROM OPF FUNDS TO IPA

2017 ◽  
Vol 5 (1) ◽  
pp. 108-126
Author(s):  
Dariusz Prokopowicz
Keyword(s):  
Economic Policy ◽  
Social Insurance ◽  
Pension System ◽  
Pension Reform ◽  
Negative Impact ◽  
Stock Exchange ◽  
System Reform ◽  
Economic Determinants ◽  
Reform Plan ◽  
Capital Construction

The article describes the demographic, social and economic determinants of the capital reform plan of the pillar of the pension system based on the transfer of capital from Open Pension Funds to the Individual Pension Accounts system. The purpose of the planned pension reform is to improve the efficiency of the capital pillar of the pension system. Reform should also counteract the negative impact of demographic change, i.e. the aging process, on the public finances of the participatory pension system managed by the Social Insurance Institution. From mid-2016, the Ministry of Development had present the "Capital Construction Program", that is an important pillar of economic policy developed in Poland in 2017, at press conferences organized by the Warsaw Stock Exchange. The main assumptions of this economic policy are laid down in the so plan for responsible development.

scholarly journals Impact Of Retirement Benefit Act (RBA) On Investment Returns To Pension Funds In Kenya

2010 ◽  
Vol 9 (4) ◽  
Author(s):  
Lucy Jepchoge Rono ◽  
Julius Kibet Bitok ◽  
Gordon N Asamoah
Keyword(s):  
Pension System ◽  
Pension Reform ◽  
Pension Funds ◽  
Insurance Fund ◽  
Retirement Benefits ◽  
Fund Managers ◽  
Long Run ◽  
Investment Returns ◽  
Mean Differences ◽  
The Impact

This study focused on the analysis of the impact of RBA guidelines on the return on investments of both pension funds under management and those for pension schemes. A random sample of 175 fund trustees and a census of 13 fund managers from registered fund management companies participated in the survey. The questionnaire was administered through the drop-and-pick method. Data were analyzed using SPSS (Statistical Package for Social Sciences) and summarized in descriptive statistics, such as mean, standard deviation, frequencies, percentages, and t-tests for mean differences were used. The study determined that annual investment return for retirement benefits schemes in the past three years ranged between 10 and 27.52%, sometimes falling below the annual inflation.  The Kenya pension funds are in compliance with the prescribed broad guidelines with regard to maximum percentages of total asset value of fund by the RBA Act. They are, however, moderately in compliance with the regulations requiring that that they maintain an actuarial solvency of 80% and above. The overall weighted returns before the implementation of RBA Guidelines was low (average scale of 1.9) while the weighted returns after the implementation of RBA Guidelines was high, at an average scale of 3.7. An analysis of the trend, however, showed that long-run performance has slowed down. The highest growth was realized for mortgage and cash returns as opposed to rights issues and bonus shares. There is need to fashion out the appropriate mix of reforms suitable for Kenya that will ensure the long-run sustainability of its pension systems. The challenge is for the country to adopt a unified, harmonized, and transparent regulatory framework that will integrate the pension system in order to ensure sustainability in its financing and mobilizing of adequate funds to cater for the ever-increasing population of beneficiaries in this regard, comprehensive pension reform policy with wider target radar and one that will consolidate and harmonize the various legislations touching on retirement benefits industry in line with Retirement Benefits Act. The Regulator needs to implement measures to ensure pension funds are insulated from inflationary and other risks.  An effective way is to institute a pension risk insurance fund that will underwrite and compensate such losses as will be prescribed. Further, there is need for a systematic indexation of benefits to inflation. RBA should strengthen its compliance and enforcement function in order to ensure that it appropriately deals with emerging present and future regulatory challenges.

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