SANEI: Ongoing Studies

Economics of Pension and Social Security in South Asia: Special Focus on Pakistan and Nepal

Pakistan Case Study

The question of assessing pension and social security schemes has gained increasing attention due to the growing number of elderly population at regional and global levels. Policy makers across the globe are struggling to adapt their pension systems to the reality of their ageing population and tightening budgets. The ageing of population has emerged as a matter of concern in the Asian region because of the declining trends in mortality and fertility levels and an increase in average life span of population.

In Pakistan, with a large population base of about 143 million and declining trends in mortality and fertility, the elderly population is likely to increase rapidly in the coming years. The total fertility rate (TFR) has declined from more than six births per woman in the 1970s to about five births in the 1990s and this trend is likely to continue in the future. The infant mortality rate (IMR) has also declined to around 82 per 1000 live births from a high level about 100, and there is an improvement in average life expectancy of both men and women in recent year. Given the changing demographic scenario in Pakistan, the issue of ageing population has gained importance in terms of increasing proportions of the less productive older people that become economically and socially more dependent with further increase in average age. This has its implications in terms of increasing costs of health care system, social security and old age benefits for the aged population. The estimates of economic activity rates by age show that majority of the elderly population (about two-thirds of population 60 years and above) is not actively participating in the labour market. This shows the extent of their economic dependency and vulnerable position in the household. This requires a continuous assessment of the social and economic implications of this situation and find ways to provide support and protection to vulnerable and disadvantaged segments of the aged population through various social security and other social safety nets program.

In this context, the specific objectives of the study with a particular focus on Pakistan are:

• To examine the changing ageing scenario
• To review the policies and programs for the elderly including social assistance and security programs
• To review the role of the government financing and existing institutional facilities to provide services for elderly

The data for the study will be drawn from both secondary and primary sources. The source of secondary data includes population census, labour force surveys, population projections and other reports and documents available in the public and private sector. In addition, a sample survey of elderly population will also be conducted through a structured questionnaire to assess the social and economic conditions of the elderly population and identify their specific needs and problems with a view to suggest the programs of social assistance through various schemes. The findings of the study will provide useful basis for formulating a comprehensive pension and social security programs in Pakistan that would contribute to reduce the economic dependence and deprivation among the elderly population.

Nepal Case Study

Population ageing is rising steadily in Nepal. The last five censuses of Nepal, reveal that the elderly people are increasing continuously both in absolute number and in proportion. Another important feature of the elderly population is that it is increasing at a faster rate (3.8 percent) than the population as a whole (2.3 percent). At this growth rate it is estimated that the elderly population will be double in less than 22 years whereas the doubling of the total population will be in 27 years. Also the Total Fertility Rate (TFR) continues to fall in the country so that the youngest age group will be smaller but the proportion of elderly population will increase.

The elderly population is one of the most neglected social groups in Nepal. Acute economic pressures, breaking up of joint family system, mobility of people have eroded the relative importance of traditional values and religious norms supportive of elderly. Moreover institutional arrangements catering to the needs of the elderly people have been far fewer and coverage limited. Government measures in actual implementation are also lacking.

There is growing recognition of the need to look after the elderly population by the government, private sector and civil society. This has become all the more essential in the context of the International Plan of Action on Ageing adopted by the World Assembly in Madrid recently. Against the above background it is proposed to undertake a study on social security, pension and other provisions for the elderly. Following are the objectives of the study.

• To assess the ageing scenario-Past, Present and Future
• To review the policies and programs for the elderly
• To review the role of the government financing in and running of old age homes and also the concessions and other benefits reserved for elderly
• To assess views of the recipients of pension and social assistance and its impact
• To suggest modalities for a comprehensive social security scheme for the elderly

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