Design of Pension Reform

closed

Description: The proposed project would finance, the development of a pension reform strategy. This would include; (i) the preparation of a diagnostic, including a legal and instituional analysis of the current pensions system and financial analysis of the pension systems, and (ii) the identification, analysis of options for pension reform, and a recommendation for a strategy for the development and implementation of a reformed pension system that is economically and financially viable and that meets the social needs of the country. If the bank and the country agree on a viable strategy, a second stage of the technical cooperation (TC) would finance the development of a detailed implementation plan, the implementation of which could subsequently be financed by a Bank loan or reimbursable TC operation.Rational. Surinam's current pension system is a combination of an under-funded public pension system, a largely unsupervised private system, and a non-targeted subsidy for citizens over 60 years old. As such, the system does not effectively meet the financial needs of retired persons, yet it still implies a large fiscal subsidy. The current government considers pension reform a priority, but it has not developed a reform strategy. The proposed program would develop a strategy to discuss with the new government. If pension reform remains a priority of this new government, the analysis could be used to develop a potential pension reform operation.