No. 56. THE FINANCING OF THE GREEK PENSION SYSTEM: 1981 – 2000 (in Greek)
F. Zervou. 2004. | ISBN: 960-341-054-3
The present study examines the trends in pension system financing and their determinants, by analyzing the levels and rates of change in pensions expenditures for main and complementary insurance and pensions fund revenues in the decades 1981-1990 and 1991-2000, by using a method from studies of the World Bank.
We evaluate the level and rate of pension expenditures relative to GDP, based on an analysis of the system dependency rate (the number of beneficiaries relative to the number of contributors) and the transfer ratio which measures the benefit generosity of the pension system. The demographic burden was and is very high in the system dependency rate. The increase in the number of pensioners and in generosity of the pension schemes were most important factors in explaining the increase in costs of main and complementary pensions, during the decade of 80s. The transfer ratio remain stable for the main pensions, since 1993, and was reduced for the complementary pensions but could not offset the impact of increased system dependency rates on pension costs
Revenue trends are explained and by changes in the contribution compliance rate (actual revenues / potential revenues) which reflects the ability of social insurance funds to collect revenues from employees and employers. The increase in the contribution base improved the compliance of pension system and rose the pension fund revenues, during the decade of 80s, but these revenues were not sufficient to cover pension costs. In the decade 1990, the contribution compliance rate was declined importantly. As a result, actual revenues from employees and employers had fallen very short of potential revenues of the main insurance.
The increase in the contribution base rose the contribution compliance of the complementary insurance scheme, during the decade of 80s, but the pension revenues remained in unsatisfactory level The contribution compliance ratio continues to rise but the actual revenues remain less than the potential revenues of the complementary pension insurance.