Argentina, the one with the best social security coverage in the region



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07-26-2018
Despite the high informality, but thanks to the moratorium on pensions, Argentina is better positioned than its counterparts

One of the structural challenges for Latin America is that, on average, almost 5 out of every 10 employees work in informality and, therefore, not listed for Social Security .

Despite the high informality but thanks to the moratorium on pensions on Argentina is better positioned than its peers: the contributors in relation to the active population reached 53.9% in 2015, after increasing 10 points in 10 years, resulting in above-average coverage. In the measure, only 4% of the majors of 65 years received neither salary nor pension, because 81,8% received only pension; 9.1%, salary and pension, and only 5.1% salary

This was described by the International Labor Organization (ILO) in its report "Present and Future of Social Protection in Latin America and in the Caribbean ", which says that the existing systems in the region are at a crossroads marked by the need to meet the needs for coverage, sufficiency (level of benefits) and sustainability (capacity to guarantee coverage and benefits).

In Latin America, the proportion of contributors increased by eight points in a decade until 2015, but it has 44.6% of contributors. With this rate of increase in coverage, the region would take 70 years to achieve near total coverage.

Meanwhile, throughout the region, 50% of people over 65 had no access to a pension (51.6%) in 2015, although coverage has increased by 6.3 points since 2005. This disadvantage is greater for women (56% do not receive a pension) than for men (39%).

] "We are talking about 145 million workers who are not indexed in a region where the population is aging, which can affect their future and that of their families," said the Regional Director. the ILO for Latin America and the Caribbean, José Manuel Salazar-Xirinachs, at the presentation of the report in Mexico City

"In recent years there has been undeniable progress but significant coverage gaps persist that need to be resolved in a compelling way, "he remarked.

The report notes that the coyun favorable economic situation allowed the region to increase social protection and combine benefits with non-contributory components, but it was translated by an increase in the tax burden

And this again, on average, social protection expenditure for the region (without health) is 4.9% of the GDP and health, of 3.3% for 2015, when the OECD allocates 14.5% and 6.2%,

The ILO is pessimistic about the fact that " can lower indicators of informality, since it requires countries to increase their growth rates to 5% or 6% on a sustained basis. "The effects could be amortized or postponed to the extent that formalization policies have been successful, "he said.

And points out that in many countries there is a process of on the pensions and its cover,

structural factors that pose challenges include: the growth of employment in the service sectors, which have relatively less formal working conditions that the industry; the growing participation of women in the labor market, which is disproportionately manifest in low-productivity and precarious occupations; the decline in the demographic premium and the aging of the population, which increases the dependency rates; the growth of the middle clbades, who formulate greater demands for social protection, and weaknesses in institutional capacities.

And that adds challenges in the region: macroeconomic volatility and pro-cyclical spending, technology change, large productivity gaps, and climate change.

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