An Assessment of Reform Options for the Public Service Pension Fund in Uganda

108 Pages Posted: 20 Apr 2016

Date Written: December 1, 2006

Abstract

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 (monopillar) 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 redistributive and pooling properties of the small defined benefit pillar.

Keywords: Pensions & Retirement Systems, Enterprise Development & Reform, Population Policies, State Owned Enterprise Reform, Labor Markets

Suggested Citation

Bogomolova, Tatiana and Impavido, Gregorio and Pallares-Miralles, Montserrat, An Assessment of Reform Options for the Public Service Pension Fund in Uganda (December 1, 2006). World Bank Policy Research Working Paper No. 4091, Available at SSRN: https://ssrn.com/abstract=951590

Tatiana Bogomolova (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Gregorio Impavido

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

HOME PAGE: http://www.imf.org

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

Montserrat Pallares-Miralles

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

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