The Alliance of Pensioners’ Organisations has taken exception to what the World Bank, which is advising the government on the next steps to be taken in the pension system’s reform, deems to be an adequate pension.
In a letter to the Prime Minister this week, the Alliance cited that at a recent MEUSAC meeting discussing the European Commission’s Green paper on Pensions, Pensions’ Working Group chairman David Spiteri Gingell had observed that the World Bank “considers a pension to be adequate if it equated to 40 per cent of the average wage”.
In its letter, the Alliance said, “It is not surprising that neo-liberal theorists, whose pension on retirement is rarely less than 70 per cent of their highest emoluments… consider a pension of 40 per cent of the average wage to be adequate for ordinary mortals.
“Where pensions are concerned, the personnel at the World Bank have an unenviable track record. In those countries which acted on its advice, pensioners are living at or near sustenance levels.”
Under accepted European norms, the Alliance underlines, the lowest pension should not be less than 60 per cent of the national median income, which stood at €9,547 in Malta according to the most recent figures – meaning the lowest pensions payable would amount to €5,728 under European norms, €229 less than what the World Bank considers to be adequate.
“The reasons for opting for the World Bank are unclear,” the Alliance adds. “It might have been better to approach one of the research institutions in the area of social affairs operating out of Vienna, such as the Vienna Research centre. The advice forth-
coming would certainly have been less skewed.
“A government with a social conscience cannot really act on such formulae. Even those lacking a social conscience should think twice before blindly following the World Bank’s advice.
“This is for the simple reason that many of tomorrow’s consumers will be pensioners. What happens to the economy if they can barely subsist? We cannot imagine our government, which often declares its belief in a society based on social solidarity and fraternity,
acting in breach of its beliefs to effectively demolish our welfare
system.”