Moroccan Court of Accounts Sounds Alarm on Severe Deficit in Pension Fund

Morocco’s Court of Accounts sounded the alarm yet again on the state of the national pension fund as its reserves continue to decline reaching a threshold of severe deficit.

Rabat – Morocco’s Court of Accounts sounded the alarm yet again on the state of the national pension fund as its reserves continue to decline reaching a threshold of severe deficit.

In a report presented to the government, the court lamented the state of the pension fund, explaining that the deficit within the fund reached MAD 5.12 billion ($509 million) at the end of 2022.

The reserves of the pension fund dropped to MAD 65.8 billion ($6.5 billion) in 2022, down by MAD 10 billion ($1 billion) despite the pension reforms the government implemented in 2016 and 2021, according to the report.

The council explained that the deficit also extends to the national social security fund (CNSS), as its deficit reached a staggering MAD 400 million in 2021.

In light of the data, the court called on the government to accelerate the implementation of reform plans, especially the one pertaining to extending the social safety net to the country’s underserved population by 2025.

The report from the Court of Accounts echoes reports from other state institutions.

A recent study from the High Commission for Planning (HCP) shows that the gap between the pensions the state dispatches and the contributions paid would result in a deficit of 7.4% of Gross Domestic Product (GDP), against 1% of GDP in 2005.

A policy analysis published in 2013 by the Carnegie Middle East Center, a think tank based in Beirut, points out three main factors underlying Morocco’s pension fund crisis: low labor force participation among women, high unemployment rates, and structural issues with the current pension system.