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Legislation Publications Pension models About project Statistics

INTRODUCTION

CHAPTER I. Overview of gender issues in pension systems from different countries
1.1. Pension system reform and gender equality issues
1.2. European Union countries with a developed „social state”
1.3. Post-socialistic countries

CHAPTER 2. Gender analysis of pension and labor legislation of the Republic of Moldova
2.1. International labor standards and national legislation of the Republic of Moldova
2.2. Legal insurance of equal access to labor and professional occupations: employment guarantees
2.3. Right to free choice of profession, professional training and retraining, professional promotion. Restrictions related to women’s work
2.4. Equal remuneration for the work of equal value
2.5. Right to healthy and safe working conditions. Guarantees and privileges for pregnancy and maternity
2.6. Right to social insurance including right to pension

CHAPTER 3. Analysis of demographic context of gender issues in the Republic of Moldova
3.1. Gender asymmetry of sex/age structure of the population of the Republic of Moldova
3.2. Differences in conditions and causes of mortality of men and women, men’s over mortality rate
3.3. Gender discrepancy of the indexes of life expectancy in Moldova and their dynamics
3.4. Life expectancy on pension
3.5. Gender differences in the correlation between the duration of the working life and life on pension
3.6. Impact of birthrate on the workers length of insured service

CHAPTER 4. Labor market of the Republic of Moldova and its impact on the trends of pension system reform: gender aspects
4.1. Economic activity, employment and unemployment
4.2. Employment by economic sectors

CHAPTER 5. Salaries and incomes

CHAPTER 6. Informal employment

CHAPTER 7. Issues of social breaks in employment

CHAPTER 8. Gender issues of current pensioners
8.1. Gender structure of pensioners

CHAPTER 9. Forecast of the specifics of pension insurance of men and women, pension transfers between sexes in the established pension system

CHAPTER 10. Gender analysis of the formulas for old-age pension calculation
10.1. Analysis of old pension formula for calculation of old-age pension
10.2. Analysis of the new pension formula for calculation of old-age pension
10.3. Change of gender discrepancy in pensions in the transition to the new pension formula

CHAPTER 11. Increase of the retirement age. Equalizing the retirement age?
11.1. Advantages and disadvantages of the retirement age increase and its “equalization” for men and women
11.2. Individual pension burden or correlation between the duration of the able-bodied age and duration of life on pension
11.3. Change of the probability of living until the retirement for men and women under different scenarios of the retirement age increase

CONCLUSIONS

BIBLIOGRAPHY




Gender aspects of the Republic of Moldova’s pension system

10.2. Analysis of the new pension formula for calculation of old-age pension

According 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:
 - average monthly insured income;
 - required length of insured service (35 years);
 - confirmed length of insured service;
 - actual pension age;
 - established pension age.
The above-mentioned pension formula indicates that the pension, calculated based on this formula, shall depend directly on the worker length of service, wage size and established retirement age.

Issues related to the record of the length of insured service in the new pension formula

The 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,
while woman’s
P=(1.2%•35+2%• (42-35)+2%• (62-57)) •Sa=0.66• 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:
 - amount of contributions paid for insurance period;
 - amount of contributions, set for insurance period;
 - number of months for which contributions are paid.

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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