As Morocco faces ageing population, pension funds get renewed attention
2008-03-30
Facing demographic change in Morocco, the long-term solvency of pension funds is at risk. The ratio of people working to those in retirement is falling. Workers do not want to increase their contributions or the age or retirement, and they hope the government will identify an equitable solution.
By Sarah Touahri for Magharebia in Rabat – 30/03/08
 [Getty Images] Morocco's pension funds are at risk of insolvency. Minister of Economy and Finance Salaheddine Mezouar said the government is considering a general reform including the introduction of both compulsory and optional schemes. |
The debate over pensions in Morocco is taking centre stage once again. With the main pension funds posting financial deficits and their solvency being called into question, officials and technocrats are accelerating efforts to introduce far-reaching reforms in order to avoid a collapse.
Moroccan pension funds are starting to feel the strain of demographic pressures, said Moroccan Interprofessional Pension Fund (CIMR) managing director Khalid Cheddadi. As the population ages and as public services employ fewer workers than in the past, he noted, the number of those paying contributions will continue to decrease year after year. If nothing is done, pension fund finances risk running seriously into the red.
Morocco's ageing population is not the pension funds' only problem. Because of a growing high number of self-employed professionals, agricultural workers and "informal" workers who do not benefit from labour legislation and collective bargaining agreements, Morocco currently relies upon only 30% of the working-age population to pay into the country's pension system.
As it stands now, the Moroccan pension fund (CMR) is not expected to survive beyond 2019. The national social security fund (CNSS) can only honour its commitments up to 2016.
According to Minister of Economy and Finance Salaheddine Mezouar, Morocco is considering a general reform, not only to consolidate the funds' long-term balances but also to lay the foundation for a harmonious and coherent system. "Compulsory schemes based on collective solidarity can live alongside complementary optional products which offer a range of choices for individual initiatives," he told Magharebia.
Calls for action by concerned trade unionists have prompted the state to consider several scenarios to rescue the pension funds. These include creating a single national fund for everyone, standardising methods of calculation in private and public retirement funds, raising the retirement age to 65 or using a lifetime work history model (35 or 40 years of work before retirement, regardless of age). So far, nothing has been decided.
Workers hope the government will find an equitable solution without having to raise their contributions or the retirement age.
Public sector worker Moha Bakkali told Magharebia: "I can’t imagine myself retiring at 65 when life expectancy is 70 years. It wouldn’t be fair."
"The State must face its responsibilities,” he said.
Morocco's pension system currently includes a number of funds. There is a fund for public workers in civil and military fields (Moroccan pension fund, or CMR); a fund for private sector workers (CNSS) complemented by ascheme managed by the CIMR (Moroccan interprofessional pension fund); and an organisation for those on State contracts (RCAR). Added to this are the various internal funds owned by certain public enterprises such as ODEP, ONCF, OCP and others.
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ahmed Posted 2008-03-30
You do not have to be a prep school or college graduate to understand that the healthcare and retirement system(s) in Morocco and in the countries of the Third World are doomed to disappear for one simple reason: there are not enough contributors and everyone is misreporting their salaries and cheating the patrons and stealing from the accounts. What is worse, everyone abuses these accounts; no one cares about being responsible. Retirement is a good for all of us. We must be careful with our so-called “expenditures”. The only solution—THE ONLY SOLUTION!—is to limit citizenship and to not let people who have lots of children think anymore that it is Allah who is going to feed them. Allah certainly helps us, but our well-being does not fall from the sky.
Ali AHMED Posted 2008-03-31
This article is full of errors. First, the CMR stands for the “Moroccan Pension Fund”, not the “Mutual Pension Fund” as you cited!!! The CIMR stands for the “Moroccan Interprofessional Pension Fund”, not the “Moroccan Interprofessional Pension Committee, as you cited!!! The CNSS stands for the “National Social Security Fund”, not the “National Commission for Social Security”, as you cited!!! Second: “a fund for private sector workers (CNSS) managed by the CIMR”—Wrong!!! The CNSS manages its own funds and the CIMR manages the system for supplementary pensions for the private sector!!! Third, “There is no co-ordination between these different schemes.”—Wrong!!! There is a law specially dedicated to their coordination. Beware; this has to do with Magharebia.com’s credibility.
SEMMAR Posted 2008-03-31
I hope that we are not going to go so far as this, that is to say: to be this abysmal. As a retiree, I would simply like to know what all these articles are trying to let us know? If I have understood this all correctly, then I am unimaginably perplexed here: is the state going to abandon us without any pension or something? It is up to the current government to find a valid solution to this both delicate and serious subject. In the end, our King, whom God glorifies, would never accept seeing his subjects, the former civil and military functionaries, in great need. This would drive them to God’s displeasure, begging.
ABDELWADI Posted 2008-04-03
An evil letter sent by the first generations to coming generations. The grandfathers lived under colonization. The fathers spent their life working hard and building their country with huge sacrifices for their country and for their families while the luckiest, who were working in the shadow, accumulating wealth under different names, and at the time when the profits made by projects in the name of the National Pension Fund, attributed to those who don’t deserve them, the same problems which were caused to the CIH bank. The employees share no responsibility in the ability or inability of the fund because we are in a state and the state should bear the consequences of the acts of the officials in its institutes. It should made them accountable. It is impossible to be convinced by that, this means the collapse of the state and it is impossible that our dear Morocco collapses. Until recently, the poor employee only received a disgraceful salary, so where has the difference gone? The State is called to plan this in advance. It is a shame, a shame that Morocco forsakes people who worked hard for 40 years and were waiting for several years feeling that they gave something to this country. So don’t make of them a bad example to us young people.
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