What Is a Contributory Pension?
Non-contributory pensions are known for their political, economic and social benefits. Non-contributory pension system was first established in Denmark in 1891
Non-contributory pension system
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- Chinese name
- Non-contributory pension system
- Foreign name
- Non-contributory pension
- Non-contributory pensions are known for their political, economic and social benefits. Non-contributory pension system was first established in Denmark in 1891
- Non-contributory pensions are known for their political, economic and social benefits. The non-contributory old-age security system was first established in Denmark in 1891. The Danish government provided pensions for poor elderly aged 60 and over. By 1897, one quarter of the nation's elderly aged over 60 received pensions. Soon after, countries such as France, Ireland, Australia, and New Zealand also successively established non-contributory pension security systems. After the 1980s, some developing countries such as Nepal, Sri Lanka, Bangladesh, India, South Africa, Mauritius, Namibia, Botswana, Argentina, Brazil, Chile, Costa Rica, Mauritania and other countries have successively established Non-contributory pension system. The experience of developing countries in implementing non-contributory pension systems shows that this system has an important role in reducing poverty in the elderly and is one of the important driving factors for economic development in poor areas.
- A key issue in implementing a non-contributory pension system is the source of funds. The source of funds for implementing the non-contributory pension system is basically the government's fiscal transfer payments. In countries with limited resources, various channels have also been adopted to finance this system. Rural non-contributory pension payments in developing countries generally account for less than 3% of the country's GDP.
- Practice has shown that implementing this system is economically feasible. Therefore, the World Bank's research report on "Country Comparison of Old-age Income Security Pension System Reform in the 21st Century" published in 2005 also affirmed the role of non-contribution-type pension security systems and proposed new ideas for pension system reform That is, the minimum level of protection and the non-contributory pension system with the goal of eliminating poverty are identified as the basic pillars, also known as the "zero pillar" of pension security.