By Carolin A. Crabbe
The social safety equation is worsening worldwide with the elderly inhabitants growing to be swifter than the hard work strength. within the final 20 years of the 20th century, the Latin American and the Caribbean sector used to be confronted with what appeared insurmountable problems during this regard. Social protection expenditures had grown with the inflation and upward changes of wages and frequent tax evasion. inside of this framework, numerous nations within the quarter undertook a profound overhaul in their social defense platforms, changing them totally or in part with a privately controlled and invested method. those far-reaching reforms have replaced the way in which social protection is considered and, for that reason, policymakers worldwide are the adventure of the zone. 1 / 4 Century of Pension Reform in Latin the USA and the Caribbean presents an research of those reforms, what labored good, what didn't, what are the teachings discovered and what are the subsequent steps.
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Additional resources for A Quarter Century of Pension Reform in Latin America and the Caribbean: Lessons Learned and Next Steps
These could be divided into two categories: the costs associated with the social security system, whether it was terminated or allowed to operate in parallel with the newly created private pillar; and the costs generated by the reform itself with the addition of the private pillar. In determining these costs, the reformers did not consider several factors. With respect to the costs of the existing social security system, the following costs should have been reﬂected: • The reduction in contributions under the PAYG system, whether or not it was terminated • The need to ﬁnance deﬁcits generated by special pension systems that remained outside the reform (military and other professional groups) • The costs of reinforcing the staff and budget of existing institutions as their responsibilities were increased.
2004. 12 (December). Buenos Aires, Argentina. Bronton, P. D. and P. Masci. 2005. Workable Pension Systems: Reform in the English-speaking Caribbean. : Inter-American Development Bank. Bustamante Jeraldo, Julio. 2004. El sistema de pensiones en Chile. C. Collins, Joseph and John Lear. 1995. Chile’s Free-Market Miracle: A Second Look. : Institute for Food and Development Policy. Domeniconi, Hector, Julia Domeniconi, Bruno Domeniconi, Andrea Perrotto and Hugo Bertin. 2004. El sistema de pensiones en Argentina.
The reform was undertaken in consonance with a much broader reform package that included ﬁscal reforms to offset the imbalance generated by the loss of contributions to the public pillar and other costs. This plan included reducing expenditures by transferring some responsibilities for covering social expenditures to the municipalities (Collins and Lear 1995). It overhauled the tax system, introducing a value added tax at a rate of 35 percent to raise revenues to ﬁnance the reduction of the public debt and the social security reform.
A Quarter Century of Pension Reform in Latin America and the Caribbean: Lessons Learned and Next Steps by Carolin A. Crabbe