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The distinction between basic pension and contributory pension: The paradoxes of the recent reform to the Greek pension scheme (Laws 3863 and 3865/2010)

Citation:

Paparigopoulou-Pechlivanidis P. The distinction between basic pension and contributory pension: The paradoxes of the recent reform to the Greek pension scheme (Laws 3863 and 3865/2010). Pensions. 2011;16:51-62.
distinction_contributory_basic_pension.pdf228 KB

Abstract:

Greece under severe financial and economic crisis has accepted the control of the World Monetary Fund and the European Union. Among other measures imposed on Greece is government funding to remain at 5 per cent of the GDP until 2030. In order to fulfill this obligation, Laws 3863 and 3865/2010 have been passed. With these laws, the distinction between basic pension and contributory pension is introduced. A theoretical mathematical model based on social security principles for calculating the aggregate pension (basic pension and contributory pension) is presented and compared to the model that corresponds to the recent reform to the Greek pension scheme. Apart from the social and economic merits of this reform, some paradoxes and shortcomings are pointed out.