Pension Problems

Yep, that's right, for most of you who are public servants, especially those of you in your twenties and thirties, who have another 25+ years to go before you retire, there may be a problem with your pension.

Pensions plans are causing headaches for governments all over the world. The main problem, globally, is that there are more and more older people and less and less young working people. That means, the government is increasingly paying more pensions and is receiving less tax to fund those paytments.


Match the headings below with the paragraphs in article below (there is on EXTRA HEADING that you will not match)

A. Main cause is a changing population

B. Reducing the pension age

C. Myanmar needs to improve

D. The 'elderly' in Myanmar

E. Three possible solutions

F. The fundamental problem

G. An extremely high cost

H. Government saving may not be the answer


The pensions crisis or pensions timebomb is the predicted difficulty in paying for corporate or government employment retirement pensions in various countries, due to a difference between pension obligations and the resources set aside to fund them. The basic difficulty of the pension problem is that institutions must be sustained over far longer than the political planning horizon.

2 _____________________________

Shifting demographics are causing a lower ratio of workers per retiree; contributing factors include retirees living longer (increasing the relative number of retirees), and lower birth rates (decreasing the relative number of workers). An international comparison of pension institution by countries is important to solve the pension crisis problem. There is significant debate regarding the magnitude and importance of the problem, as well as the solutions.


For example, as of 2008, the estimates for the underfunding of the United States state pension programs ranged from US $1 trillion to US $3.23 trillion. The present value of unfunded obligations under Social Security as of August 2010 was approximately $5.4 trillion. In other words, this amount would have to be set aside today so that the principal and interest would cover the program's shortfall between tax revenues and payouts over the next 75 years.

4 _____________________________

Some economists question our ability to address the problem by saving now. Storing funds by governments, in the form of fiat currencies, is the functional equivalent of storing a collection of their own IOUs. Since the government is responsible for printing the currency, the act of printing now, saving it, and then releasing it into circulation later is economically equivalent to simply printing it later. This suggests that the hoarding of cash by the government today to address the later crisis is a non-solution.

5. ___________________________

Reform ideas can be divided into three primary categories. Firstly, balancing the worker-retiree ratio, by raising the retirement age. Secondly, reducing obligations by shifting from defined benefit to defined contribution pension types and reducing future payment amounts. Finally, funding pensions by increasing contribution rates and raising taxes.


The Myanmar government enacted the Myanmar Ageing Law in 2016. The law defines “elders” as people aged over 60. The proportion of the population 60 years and older is increasing, and is now about one out of every 11 people. According to the 2015-2016 projections about older people in Myanmar, there are 4.75 million seniors, or 9.06 percent of the country’s 51 million people.


In 2018, the Ministry of Social Welfare, Relief and Resettlement, lowered the age for senior citizens who are eligible to receive social pensions from 90 to 85 years old. The pension will pay a qualifying senior K10,000 per month. In the previous fiscal year, over 50,000 elderly who are 90 years old and over applied for social pensions, according to the Department of Social Welfare.

When you are ready, enter your answers in the test sheet below.



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