Pensions: Sustainability and adequacy

In two editorials on pension reform in the space of a week, The Times stressed the need for sustainability. What message exactly is the paper trying to convey? That sustainability comes before all else, including the well-being of thousands of pensioners and of the economy itself?

Implicit in the editorials is that sustainability is only attainable at the cost of adequacy. The Alliance of Pensioners’ Organisations disagrees. Malta has among the lowest rate of pensioners economically active in the EU. The female participation rate is about half the EU average and the number of seniors in employment is negligible.

If the total participation rate is increased, if arrangements are in place to increase substantially the female participation rate and if the concept of an all inclusive society is reflected in keeping more seniors economically active, then sustainability would not be a problem. Policies ensuring job creation are the answer. This is not to mention the substantial savings which can be achieved through good governance.

Allow me to point out that if pensioners can barely subsist on their pension – a policy the paper appears to favour – the economy would be harmed as tens of thousands would consume less.