Toward an Inclusive, Equitable, and Sustainable National Pension System in Iraq

A pension system is at the heart of social protection. By ensuring income security for older persons and other vulnerable groups, it prevents poverty, reduces inequality, and facilitates consumption smoothing. A pension system also affects the working population’s labor market choices and has important fiscal implications. Iraq’s current pension system is highly fragmented, inequitable, and inefficient. First, it fails to provide adequate income protection to most of Iraq’s old‑age population and other vulnerable groups, such as survivors and persons with disabilities. Second, the public sector pension is already putting substantial pressure on the budget and is potentially unsustainable given the projected acceleration of the total pension bill due to recent policy changes. Third, it sets an uneven playing field between the public and private sectors, contributing to the continued expansion of an already‑outsized civil service and holding back much‑needed economic diversification and private sector growth. Thus, a comprehensive pension reform is urgently needed and would align with commitments made by the Government of Iraq through the ratification of ILO Convention No. 102. Based on collaboration between the IMF, ILO, and the World Bank, this paper aims to (1) Provide an assessment of the existing public and private pension system across the four dimensions: fiscal sustainability, labor market implications, coverage, and adequacy of benefits. (2) Develop and propose options to adjust the pension system with a view to improve adequacy of benefits and expand coverage, enhance financial and fiscal sustainability, make the system viable across generations, reduce distortions in the labor market, and align the system with international social security standards and international best practices. (3) Provide a basis to engage key stakeholders—including workers, employers’ organizations, and the civil society - on strategies to achieve a more inclusive system, importantly by including workers in the informal economy, female workers, workers with disabilities, and other disadvantaged groups. The reform proposals presented here provide one possible route to address the most critical shortcomings of the current fragmented system, in line with international standards and good practices. Convergence on the specific reform options and parameters should result from further discussions and dialogue among all relevant stakeholders in Iraq.

Bibliographic Details

Main Author:	World Bank
Format:	Report biblioteca
Language:	English en_US
Published:	Washington, DC: World Bank 2024-07-22
Subjects:	PENSION FUNDS, PENSION ARRANGEMENTS, SOCIAL ACCOUNTABILITY, PENSION INVESTMENT FOR JOBS, DECENT WORK AND ECONOMIC GROWTH, SDG 8,
Online Access:	http://documents.worldbank.org/curated/en/099901106252445400/IDU1c2bc2e9714c231422a1804e1f2435c5d6112 https://hdl.handle.net/10986/41926
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