Économie et Statistique n° 441-442 : Pension systems and their reforms; assessments and projections
Impact of Pension Systems on Living Standards of the Elderly in North Africa
This article studies the impact of pension systems on living standards and poverty among the elderly in three North African countries: Algeria, Morocco, and Tunisia. All pension systems in the region are contributory systems of the Bismarckian type. We find that pension rates in the three countries are rather high, at about 50% of the average wage. However, there are sharp disparities by economic sector and gender. In addition, a high percentage of the population is not covered by old-age insurance. This situation correspondingly reduces the impact of pension systems on seniors' income. What resources are available to the elderly in the absence of retirement benefits, or as a supplement to them? Survey data allow estimates of each income source in the three countries. Generally speaking, we find them to be diversified, with earned income and support from children and family ranking highest. But the three countries display strong differences. Unlike in other developing regions, however, poverty in North Africa is less pronounced among the elderly than in the rest of the population. Family solidarity makes a substantial contribution, probably equal to that of the pension systems. To cope with current demographic, economic, and cultural changes, and absent an extension of coverage to a broader population, the introduction of non-contributory benefits-as in other countries-could be a choice for North Africa to follow as a means of combating poverty.