2011年-世界发展银行全球_Mongolia_Policy_Options_for_Pension_Reform_124页_1mb

Summary of Mongolia Pension Reform Report (Report No. 68526-MN)

Core Content

This report evaluates the current pension system in Mongolia and proposes policy reform options to address its design weaknesses and financial sustainability challenges. It was prepared in response to a request from Mongolian authorities and considers the demographic, economic, and fiscal context of pension reform. The report outlines a three-tier pension design architecture and recommends a range of policy options to improve old-age income protection, especially for vulnerable groups like herders and the informal sector.

Main Objectives

• To assess the current pension system and identify key design flaws.
• To propose reform options that enhance pension adequacy and sustainability.
• To evaluate the fiscal implications of different reform scenarios.
• To explore the potential of using natural resource revenues (e.g., mining royalties) to support pre-financing and transition arrangements.

Key Findings and Recommendations

Current Pension System Issues

• Weak Incentives for Participation: Minimum pension provisions create weak compliance incentives, leading to a majority of retirees receiving flat benefits.
• Fiscal Burden: The state subsidy for pensions is expected to increase significantly due to aging population, low retirement age, and low contribution rates.
• Coverage Gaps: Herders and informal sector workers are largely excluded from contributory pension schemes, leading to low coverage and potential income inequality among the elderly.
• Poor Alignment of Benefits and Contributions: Disability and survivorship pensions are not well-aligned with actuarial principles, resulting in inadequate benefit design.

Policy Options

1. Tier I – Targeted Social Pension

   • Rationale: To provide a modest minimum income to retirees in the bottom half of the income distribution.
   • Recommendation: Replace the minimum pension guarantee with a Targeted Social Pension, which would be subject to a pensions test. This pension should be integrated with the Social Welfare Pension and use a factor that reduces the social pension by a proportion of the Pension Insurance benefit.
   • Fiscal Impact: Requires careful management to ensure affordability and adequacy.

2. Tier II – Contributory Pension Insurance

   • Rationale: To address the inadequacy and fiscal burden of the current NDC scheme.
   • Options:
     • Modify Key Parameters: Increase retirement age to 65, reinstate a 19% contribution rate, and establish an actuarially fair annuity factor.
     • Defined-Benefit Scheme: Replace the NDC scheme with a defined-benefit system for pre-1960 cohorts.
     • Points Scheme: Introduce a points-based system for post-1960 cohorts.
   • Recommendation: Gradually increase retirement age and contribution rates while aligning benefit formulas with actuarial valuations.

3. Tier III – Supplementary Voluntary Pensions

   • Rationale: To provide additional income security through private, voluntary pension arrangements.
   • Recommendation: Establish a regulated and supervised framework for voluntary occupational and individual pension savings. Include investment guidelines and tax treatment reforms to encourage participation.

Special Needs of Herders and the Informal Sector

• Coverage Gap: These groups are not covered under the contributory pension scheme, leading to low retirement benefits.
• Policy Options:
  • Mandate contributions for herders and informal sector workers.
  • Expand the voluntary pension program and introduce matching contributions.
  • Integrate the Social Welfare Pension into the Targeted Social Pension.
• Recommended Approach: Introduce a matching defined contribution (MDC) scheme where the government matches individual contributions, ensuring basic income security for the lowest-income retirees.

Pre-Funding and Pension Reserve Fund

• Rationale: To manage the transition and pre-finance future pension liabilities.
• Recommendation:
  • Establish a Pension Reserve Fund using a portion of mining royalties.
  • Use the fund to support the transition process and supplement retirement benefits for post-1960 cohorts.
  • Ensure proper governance, investment policies, and withdrawal rules for the fund.

Governance and Institutional Reform

• Legal and Oversight Framework: Strengthen legal frameworks and oversight for private voluntary pension arrangements.
• Institutional Capacity: Enhance the capacity of institutions to manage and supervise pension systems, especially for voluntary savings.

Key Design Parameters

• Income Replacement: Targeted level of income replacement in retirement.
• Contribution Rates: Adjust employer and employee contribution rates to ensure adequacy.
• Retirement Age: Gradually increase to 65 for both men and women.
• State Subsidy: Evaluate the role and sustainability of government subsidies.
• Actuarial Fairness: Use actuarially fair annuity factors and align benefit formulas with demographic changes.

Conclusion

The report concludes that a three-tier pension design is necessary to address the diverse needs of Mongolia’s population. A modified NDC scheme is preferred over a defined-benefit or FDC scheme due to its existing institutional framework and flexibility in adjusting to changes in life expectancy. The establishment of a Pension Reserve Fund using mining royalties is recommended to support transition arrangements and ensure long-term sustainability.

Summary of Reform Scenarios

• Scenario 2E: Removal of minimum pension guarantee, increase in retirement age, contribution rates, and adoption of actuarially fair annuity factors.
• Scenario 3A: Reinstating the pre-1999 PAYG defined benefit scheme.
• Scenario 3B/C: Conversion to a defined-benefit or points scheme with parametric changes.
• Scenario 4A/B/C: Conversion of NDC scheme to fully funded DC or FDC scheme.

These scenarios show similar costs and risks, with the modified NDC scheme offering more flexibility and lower institutional costs.

Appendix Highlights

• Appendix 1: Details current pension insurance parameters.
• Appendix 2: Glossary of key terms and acronyms.
• Appendix 3: Options for pre-financing pension liabilities.
• Appendix 4: Elaborates on the Santiago Principles for pension reform.
• Appendix 5: Simulation results of various reform options, including replacement rates and fiscal impacts.

Tables and Figures

• Table 1: Summary of reform needs and proposed policy options.
• Figure A: Illustrates the three-tier approach to old-age income protection.
• Figure 1-5: Show demographic and economic trends, including fertility rates, life expectancy, and labor market data.
• Figure 6-49: Present detailed projections, costs, and benefits of different reform scenarios.

Final Notes

The report emphasizes the need for a comprehensive reform process that integrates policy choices, institutional reforms, and the use of natural resource revenues. It also highlights the importance of actuarial modeling and long-term planning in ensuring the sustainability of Mongolia’s pension system.