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CHAPTER I. Overview of gender issues in pension systems from different countries CHAPTER 2. Gender analysis of pension and labor legislation of the Republic of Moldova CHAPTER 3. Analysis of demographic context of gender issues in the Republic of Moldova CHAPTER 4. Labor market of the Republic of Moldova and its impact on the trends of pension system reform: gender aspects CHAPTER 5. Salaries and incomes CHAPTER 6. Informal employment CHAPTER 7. Issues of social breaks in employment CHAPTER 8. Gender issues of current pensioners CHAPTER 10. Gender analysis of the formulas for old-age pension calculation CHAPTER 11. Increase of the retirement age. Equalizing the retirement age?
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Gender aspects of the Republic of Moldova’s pension system
10.2. Analysis of the new pension formula for calculation of old-age pensionAccording to the new formula (3.1) the pension is calculated, if the worker has more than 20 years of length of service, gained after 1999, where: Issues related to the record of the length of insured service in the new pension formulaThe new pension formula envisages the local-linear dependence of the pension size on worker’s length of service, i.e. it is linear not on the whole temporal interval, but only on certain (local) intervals, which depend on the correlation of individual and standard length of insured service, actual and standard retirement age (see the formula). The analysis of this dependence shows that the new pension formula envisages a mechanism, which discriminates men. This is related to the difference in the retirement age, considered in the third item of the formula. In fact if we consider a man and a woman having similar wages and length of service, under the length of service of over 35 years and actual pension age of more than 62 years, the woman’s pension shall be higher, since according to the legislation “under the length of service of 35 years, the pension is increased additionally by 2% of the insured income for each year, worked after the achievement of the established retirement age”; the pension for the period from 57 years to 62 years shall increase only for women, since they are retired at the age of 57, while men – at the age of 62. Let’s illustrate the above-mentioned by means of the following example. The man and woman have started to work at the age of 20 and worked 42 years without a break and received the similar wage. Thus the man’s pension is equal to P=(1.2%•35+2%• (42-35)) •Sa=0.56• Sa, i.e. under equal wage and length of service the woman benefits by a pension by 2%• (62-57) • Sa=0.1• Sa higher than the man or by 18%. Considering the difference in the residual life expectancy, the discrepancy in the total pension payments shall be more significant. Issues related to the record of the wage size in the new pension formula.In the new pension formula the size of the wage of the future pensioner is calculated by means of the average insured income, which is calculated using the following formula:
where: The analysis of the above-mentioned dependence shows that this part of the new pension formula also envisages indirect discrimination, but related to women. Since the existing gender differences in labor remuneration (often related to direct or indirect women discrimination in the employment sphere and on labor market) are also reflected in gender differences in pension size. The existing discrimination in the employment sphere by means of such pension formula is translated directly to the pension insurance sphere. From our point of view the solution to these issues is outside the pension insurance system. These issues should be solved by standing up against the forms of discrimination based on sex on labor market, including changing the stereotypes, established in the society (and which are shared by the employers, as well as by women and members of their families), according to which for women the professional employment is secondary compared to family work, the women are the worst and less reliable workers compared to men and so on. |
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