financing. c) Regime de Previdência Complementar(Supplementary Pension Scheme: RPC) for additional voluntary savings, administered by many private firms or not-for-profit civil entities, which can be of two types:“closed,” having most of the insured and capital, a fully-funded scheme, established by one or more employers or by unions, usually chosen by large companies; and“open,” which can be DC, DB, or variable contribution, not necessarily related to employment, for salaried and self-employed workers, as well as other individuals, managed by insurance companies, paying an annuity or lump sum, usually chosen by small- and medium-sized enterprises; this subsystem was analyzed in section IV-5-b(SEPT, 2020c). d) Non-Contributory Pension Scheme(Continued Benefit: BPC) that grants a pension equivalent to a minimum wage to persons over 65 years of age lacking a contributory pension or to the disabled or families with an income of less than a quarter of the minimum wage. Brazil’s coverage is the highest among public systems(except for Bolivia regarding non-contributory pensions): the EAP coverage was 56% in 2018 (the fourth highest in the entire region; it expanded by 19 percentage points in 2000-2014, one of the fastest in the region; ECLAC, 2018). Self-employed workers have compulsory coverage and a 39% affiliation, while the coverage of the older adult population was 87.8%(both the third highest)(Table 5). The 1988 Constitution guaranteed the rights of the most vulnerable groups of the population and forced the government to provide funds to pay social security benefits and, if necessary, to implement specific taxes or increase their rates. Social solidarity is quite strong, particularly in non-contributory pensions that have significantly reduced poverty, especially after 1988. In 1978-1988 there was no progressive effect on income distribution in social security transfers among deciles of family income; however, in 1988-2012, said transfers increased 26 percentage points in the first decile(lowest income) and 31 points in the second, but 6 points in the ninth and 10 points in the tenth(highest income). Rural workers also expanded their coverage and received substantial transfers(Matijascic and Kay, 2014). EAP female coverage was 56% in 2018 and that of the older adult women was 86%, both 169
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Evaluation of four decades of pension privatization in Latin America, 1980-2000 : promises and reality
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