An assessment of reform options for the public service pension fund in Uganda

By: Contributor(s): Material type: TextTextSeries: Policy Research Working Paper, no.4091Publication details: Washington, D.C. World Bank 2006Description: 108p. Includes bibliographical referencesSubject(s): DDC classification:
  • 331.252
Summary: This paper analyzes the future liabilities that the Ugandan Public Service Pensions Fund might accumulate under the provisions of the Pensions Act (CAP 286) unless it is reformed. It then discusses alternative reform options that can be used in designing an educated homegrown reform of the fund. The paper supports a hybrid (two-pillar) reform option composed of a small defined benefit scheme and a complementary defined contribution scheme, instead of a pure defined contribution (mono-pillar) reform option discussed by policymakers in the country. The main reason for this is related to the fact that hybrid and pure defined contribution reforms will have the same impact on reducing pension expenditure (for the same grandfathering rules and surplus in the first pillar). In addition, everything else being equal, the hybrid reform is likely to produce higher average replacement rates due to the re distributive and pooling properties of the small defined benefit pillar.
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Books Vikram Sarabhai Library Rack 17-A / Slot 612 (0 Floor, West Wing) General Stacks 331.252 B6A8 (Browse shelf(Opens below)) Available 162968

This paper analyzes the future liabilities that the Ugandan Public Service Pensions Fund might accumulate under the provisions of the Pensions Act (CAP 286) unless it is reformed. It then discusses alternative reform options that can be used in designing an educated homegrown reform of the fund. The paper supports a hybrid (two-pillar) reform option composed of a small defined benefit scheme and a complementary defined contribution scheme, instead of a pure defined contribution (mono-pillar) reform option discussed by policymakers in the country. The main reason for this is related to the fact that hybrid and pure defined contribution reforms will have the same impact on reducing pension expenditure (for the same grandfathering rules and surplus in the first pillar). In addition, everything else being equal, the hybrid reform is likely to produce higher average replacement rates due to the re distributive and pooling properties of the small defined benefit pillar.

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