The AGN Projected Four Scenarios for the Future of the Senior Citizen System
<p>The agency conducted an assessment on the possible behavior of the pension scheme between 2009 and 2050 against different economic contexts. If the federal tax sharing is added, there would be a surplus. The largest deficit would be if pensions would go to 82% mobile, not the lowest, living wage, but salaries per activity. The work, which was approved unanimously, predates the recent debates in the Congress of the Nation.</p>
The General Audit Office (AGN, for its acronym in Spanish) conducted a study of the Argentine financial projections System (SIPA) for the period 2009 to 2050, evaluating the performance of different formulas and results against four macroeconomic scenarios where GDP growth rates were modified as well as formal employment.
For its preparation they used economic variables provided by the Secretariat of Economic Policy and information security system for the period 2007. However, according to the work, there were "situations not covered, following the closing date of the report (2009)" as for example, the "adoption of the Universal Child Allowance, the change in the contribution to self-employment tax and university teacher mobility."
The study presented this year presents the "restrictions on the results achieved." The AGN had no access to the legal claims "the differences in the calculation of the initial credit and mobility" and other litigation, or "the number of benefits received from special rules" amount, those who have had the Mobile from 82 to 85% of the last salary and that "are updated every time so do the wages of activity."
Construction of Scenarios
To achieve the final results, the following formulas of income and expenses were taken in the first instance to plan the financial results of SIPA.
Accordingly, the study defines the pure result as one in which "the pension and retiree system is financed only from contributions, and pays only the salaries of the beneficiaries"; SIPA result, which is added as a source of income "15% of the Federal Revenue Sharing" and, on the expenditure side, "Debt Bonds Pension Fund." The Anses result, also "includes all the pension and tax revenues and spending throughout the ANSES, family allowances, transfers to other jurisdictions and operating expenses"; and finally, the ANSES IFC result without showing the above formulation without sharing. For each of these results, the study found that the pension represents "41% of the average wage in the economy."
They also simulated "operation of SIPA with the rules of the pension scheme for teachers," that is, 82% mobile, not the vital and minimum wage, but the last salary received. Note that no account was taken of the concepts addressed in the projects aim to bring the minimum pension to the minimum 82% mobile, living wage, treated for this year (See Compliments and warnings on the adoption of the report).
The described results were analyzed taking as its starting point a baseline scenario, which mainly indicates that "the gross domestic product in nominal terms, growing at the rate of 7.8% per year and the rate of informal employment decreases from 34.6 % in 2009 to reach a value of 7.5%" in 2050.
The following economic scenarios are referred to develop awareness and change informality rates and GDP in the baseline scenario, keeping -in each case- the other variables constant. Among them, one expects zero growth in GDP for 2009 and a recovery in 2010 and in terms of labor informality, were projected two, where one side was "estimated a 50% reduction in the rate variation" and the second, is "that it remains constant as the values of 2008."
Deficit and Surplus
From the data analyzed, it can be seen that, "in all projections, the Pure-only contributions and benefits-result is deficient," the same is true in the Anses result without sharing, and observed that the scenario presents "greater deficit, it is the one who" recognizes having an average equivalent to 82% of the average mobile revenue."
The surplus projections are the results obtained by SIPA, in all alternatives addressed, and the ANSES results that "a deficit in 2020, when holding constant the levels of informality."