The Principle of Equivalence and its Alleged Effects One promise that has been kept in most private systems is the principle of equivalence, i.e., private systems have strengthened the relation between con­tribution and the amount of pension. However, such principle did not attain an adequate RR, whereas social solidarity and gender equity were sacrificed (as proved in section IV-2). Likewise, the structural reformers’ claim that the principle of equivalence managed to reduce contributions and evasion has not been met(see sections IV-4 and IV-5). Measures to improve sufficiency in the re-reforms in Chile and El Salvador are analyzed in section V. 4. EFFICIENT ADMINISTRATION AND REASONABLE COSTS a. Promises of the Structural Reforms Strong competition among pension fund administrators will increase efficiency and reduce administrative costs, as the insured—having freedom of choice— will join and switch to the best administrators, i.e., those charging lower fees and paying higher pensions.“A modern social security pension system would require—first of all—agile, competitive, and efficient companies... contributions would be lower, because, among other reasons, of the greater efficiency of the private management, the fewer possibilities of fraud, and the less incentive to evasion... each worker[would know] exactly the amount he/she pays for the pension benefits he/she receives, which would make easier the decision to switch or not”(Piñera, 1992: 21-22, 26). The WB supported the private admin­istration of the individual fully-funded system or pillar:“This report strongly recommends that the funded pillar be privately managed.” It added:“Workers choose the fund in which to place their savings, presumably based on its records on[capital] returns and risk… quite commonly, the government determines the use of the mandatory savings accounts and sets the rate of return[as in the defined benefit plans]... which may lead to distortions in the capital and labor 78