The provision of old-age arrangements is a universal right of older people
Future For Generations The Pension & Development Network is a network of various Dutch financial companies and institutions, all experts in the field of pension provisions and Micro Finance Institutes or NGOs active in the microfinance sector on a local level.
Program of Wordgranny, partner of Helpage International, provided with CBF quality mark
Our aim is to build bridges between pension experts and the microfinance branche in emerging economies
The need for old age provisions
Impact on poverty
The world’s population is growing rapidly. By 2050, older people will outnumber the younger for the first time in worlds history1. For emerging economies in the 21st century, global ageing will be one of the most demanding problems they face2. Without advanced planning and the necessary money to cope with the social and economic challenges of population ageing, emerging economies face a daunting outlook of persistend old-age poverty. Micro pensions offer a simple and effective means to alleviate this problem.
A study by HelpAge International on the impact of non-contributory pension programmes on poverty shows that the programmes significantly reduce the probability that individual households with a pension recipient will be in poverty. Also, the evidence of this study suggests that extending noncontributory pensions programmes to other developing countries could have a significant impact on reducing poverty and vulnerability among households with older people3 .
Why micro pensions as old-age provision?
Regular cash transfers also increase poor older people’s access to services, particularly health care. As older people live and share resources with younger family members, pensions have a substantial impact on child wellbeing, and contribute to increased school attendance and better nutrition among children. Old-age provisions based on pensions can play an important role in breaking intergenerational poverty cycles. Rather than creating dependency, pensions can actually reduce it.
• Micro pensions are the next step in microfinance provisions. Participants save voluntarily over a long period. The built up savings are invested by a professional asset manager. • At a pre determined age, often around 58 – 60 years, the built up assets can be collected as a lump sum, in phases or on a yearly basis as an annuity. Often, a combination of these methods is used. • Old-age provisions in the form of micro pensions are important for the poor, especially for women, to be able to safely accumulate, grow, and protect wealth.
The WorldGranny Pension & Development Network WorldGranny is a non-governmental organization in the Netherlands, supporting projects for older people and their communities in developing countries, in the areas of income, care, health and rights. In consultation with local organizations WorldGranny assist older people in Africa, Latin America and Asia. WorldGranny is partner of HelpAge International, a worldwide network of 70 organizations working in 50 countries with and for older people in developing countries to improve the quality of their lives and that of their relatives. As global ageing continues, the consequences of migration and the hiv/aids epidemic make the life of older people more vulnerable. It’s the paradox of development that longevity is becoming a serious risk that (extended) families can often hardly bear. The only structural solution to ageing is the implementation of pension schemes. Therefore, WorldGranny has initiated the Pension & Development Network, in which we combine forces and exchange expertise on risk management in emerging eonomies. The aim of the Pension & Development Network is to link pension funds, banks, policy makers and NGOs in the Netherlands to MFIs, NGOs and banks in emerging economies, in order to exchange knowledge and experience about developing and implementing old age provisions focusing on social and micro pension schemes.
Members of the network are willing and able to link their joined expertise in the field of pensions to the growing need for institutionalized old age provisions in emerging economies.
The Pension & Development Network consists of: 1. Companies and organizations in the Netherlands concerned with various aspects of pension facilities, such as administration and distribution, actuarial knowledge, gover- nance and control, taxation etc. 2. Dutch and international NGOs concerned with development cooperation and / or microfinance. 3. Partners in emerging economies; mutuals, pension management organizations, microfi- nance institutions, banks and insurance initiatives aimed at the poor.
How does the network operate? The Pension & Development Network offers concrete support in designing, developing and implementing savings and micro pensions schemes. Combined, its members of the network posses knowledge and expertise in all areas of pension systems, including; direct investments, risk management, asset management, governance, project management, project finance, IT solutions, logistics, marketing, supervision and regulation.
How does the network operate? In order to exchange knowledge and experience about developing and implementing old-age provisions based on pension schemes, MFIs / NGOs that approach the Pension & Development Network with a concrete request for support are linked to the Network’s experts. A project group will be set up, out of which the request is analyzed and a solution is designed and implemented. Cooperation always takes place on a local level, where the Pension & Development Network partners with local agencies. The network also assists these organizations to develop or upgrade their savings and insurance products to a product with characteristics of a pension, and does so by providing workshops and trainings.
P&D Network provides technical support to REDCAMIF REDCAMIF is a private entity comprised by six microfinance networks in Guatemala, Nicaragua, El Salvador, Honduras, Panama and Costa Rica. It has more than 100 affiliated MFIs with more than 750 offices and 2,800 promoters in the region serving nearly 900,000 customers. In 2009 REDCAMIF developed a micro pensions pilot project, which intends to contribute to reducing poverty of older people; micro and small entrepreneurs, self employed people and low-income families in Central America. In 2010 the P&D Network provided technical support to REDCAMIF. The P&D Network successfully evaluated REDCAMIF’s micro pension project plan regarding the design, actuarial issues, IT and administrative aspects of the pension plan.
Pension & Development Network Vossiusstraat 20-II NL-1071 AD Amsterdam + 31 20 67 22 581 www.pensiondevelopment.org info@pensiondevelopment.org Visit us on social media: 1. 2. 3.
http://www.helpage.org/resources/ageing-data/, visited February 22, 2011. United NAtions, ‘World Population Ageing 2009’. Department of Economic and Social Affairs, Population Division, 2010, New York. Non-contributory pensions and poverty prevention: A comparative study of Brazil and South Africa, Final Report, DFID Project R7897, Pensions and Poverty Prevention, HelpAge International, September 2003.