The Moroccan Pension System: A Crisis On The Horizon, Who Is to Blame?

by larbi Arbaoui

Morocco World News

Taroudant- Jan 19, 2013

A recent study revealed that the pension systems in Morocco suffer a number of issues, and that the deterioration of the demographic ratio led to imbalances between expenditures and resources for various systems. The study, carried out by the High Planning Commission, suggests that the deterioration of the financial situation of some components of the pension system are due primarily to the level of compensation and the services they provide.

In figures outlined by Prime Minister, Abdelilah Benkirane, in a speech to parliament late on Wednesday, he painted a dire and bleak situation of the Moroccan pension systems. Mr. Benkirane expressed to the members of the Second Chamber his distress about the current situation, and called on various political, economic and civil societies to unite their efforts to support the government in its actions to recover the slippery slope.

Mr. Benkirane called on everyone to set aside all their political differences, and focus on how to reform these pension systems that will begin to dip into their reserves. “By2050, all national reserves will be drained if no action is taken,” Benkirane said. To avoid the specter of bankruptcy of our pension systems, the prime minister suggested raising the retirement age, calculating pension on the basis of the rate of pay for the last several years instead of the rate of the recent year, and increasing the contribution of the beneficiary.

Unfortunately, these are only technical solutions. This is really what we sarcastically call in Moroccan culture, “Taht Somaa Aalku Al Hajjam” (the minaret collapsed, punish the hairdresser) meaning that he is blaming and punishing the wrong person. Placing the blame on wrong people while setting those responsible for the disorder of pension systems is a step away from reforming the sector.

As an employer in the public sector, I was expecting Mr. Benkirane to enlighten the public opinion and explain to people how “Our pension systems are at stake” as he said during his speech to parliament. Who is behind this expected “bankruptcy”? Where have the regular contributions of employers since 1959 gone? I think that these are the answers that contributors to those systems need to hear.

However, the government, as usual, is getting far from tackling the real causes of the problem and carries on its plans that target the working class. As democracy insists, any fair attempt to reform must first call to account anyone responsible for the budgetary imbalances of this sector. Mr. Benkirane is required to put into action the program by which his party was elected, which is fighting corruption and accountability. Logically, the working class should not pay the price for any imbalances in the pension system, and the state has to safeguard workers contributions so that they can secure a decent life after retirement.

In the absence of real reform, taking into account the interests of the workers and their rights, workers can’t think of their retirement without care. Statistics indicate that the number of retirees in Morocco reached 2.8 million. Sadly, only 16% of those retirees are getting their wages, with a pension no more than 1,000 dirhams ($120). The government should protect, not undo the gains of the workers.