Fiscal Effects of the 1993 Colombian Pension Reform
November 1, 1998
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Summary
This study examines the fiscal impact of the pension reform adopted in Colombia in 1993, which established a fully funded, privately administered pension system alongside the existing pay-as-you-go state scheme. The reform increased the contribution rate and reduced the benefits of the state scheme. However, the fiscal cost of the reform was high, estimated at 1.5 to 2.3 percent of GDP annually over the next three decades. This reflects concessions made to special groups of public servants, the delay in making effective the new retirement conditions, and the minimum pension guarantee. A new generation of pension reforms needs to be adopted.
Subject: Aging, Economic sectors, Expenditure, Labor, Pension reform, Pension spending, Pensions, Population and demographics, Public sector
Keywords: Aging, Caribbean, GDP, government sector worker system, ISS liability, ISS scheme, Latin America, liabilities correspond, oil worker, PAYG Systems, Pension Funds, pension liability, Pension reform, Pension spending, Pensions, Public sector, Social Security, WP
Pages:
23
Volume:
1998
DOI:
Issue:
158
Series:
Working Paper No. 1998/158
Stock No:
WPIEA1581998
ISBN:
9781451857559
ISSN:
1018-5941
