ARGENTINEAN WAY OF PENSION SCHEME REFORMATION IN THE 1990S

Abstract

The article reveals the problems of actual importance concerning the Argentinean pension scheme and government’s attempts to reform it. The objective of the study is to highlight the process of Argentinean pension scheme transformation within the context of changes in its socioeconomic model in the 1990s. The methodological basis for the study lies in dialectic approach according to which reformation activity of current state is a way of resolving social conflicts, meeting the requirements of all members of society and harmonizing social relations. The reformation activity of the Argentinean state is described as an attempt to resolve the controversies of pension scheme and harmonize the interests of different social groups. Methods of analysis and synthesis, classification are applied in the study, as well as chronological, logical and descriptive methods. Scientific novelty of the study lies in the fact that it makes of the first attempts to study the preconditions, introduction and consequences of pension scheme reformation in Argentina within market transformations in the 1990s in its complexity. Conclusions reflect the main results of the study. It is noted that traditional solidarity pension scheme in Argentina did not cover the vast majority of citizens and featured the low level of retirement payments. The reasons for such situation were demographical situation (ageing of population, unfavorable demographic load) and peculiarities of socio-labor sphere. It is emphasized that a great number of Argentineans stay below the line of pension insurance due to high level of unemployment and informal employment. The specificity of transition process from state solidarity to integrated pension scheme is revealed, in the latter the advantage is provided to accumulating scheme managed by the private sector. Legal and regulatory instruments on pension scheme are analyzed. It is proved that the state of Argentineans’ pension security did not benefit from pension reform, moreover, a number of pension depositors and payees lessened. The reasons for unsuccessful reform are defined. The contributions of depositors to pension funds were irregular due to high level of unemployment and a huge informal labor sector which involved nearly a half of able-bodied population, as well as economic stagnation at the end of the 1990s. A vast majority of depositors remained beyond the line of pension coverage as a result of introduction of high 30-year barrier as for obligatory pension contributions by the Law. The study comes to the conclusion that cancellation of reforms and reverting to the previous solidarity system managed exclusively by Argentina is more beneficial for the population.